G.R. No.
148974 : July 2, 2010OMC CARRIERS, INC and JERRY to add the lost value of the hull less the P200K insurance and unrealized profits and
AALUCAS y PITALINO, Petitioners, vs. SPOUSES ROBERTO C. NABUA
and ROSARIO T. NABUA, Respondents.
FACTS:
On August 4, 1995, at about 3:00 pm, an Isuzu private tanker with plate no. PCH
612, owned by and registered in the name of petitioner OMC Carriers, Inc. and then
being driven by its employee Jerry P.Aalucas, was cruising along Quirino Highway
towards the general direction of Largo, Quezon City. At Barangay Pasong Putik,
Novaliches, Quezon City, the aforesaid private tanker hit a private vehicle, anIsuzu
Gemini with plate no. NDF 372, which was making a left turn towards a nearby
Caltex Gasoline station. The impact heavily damaged the right side portion of the
latter motor and mortally injured its18-year-old driver, Reggie T. Nabua, who was
later pronounced dead on arrival at the Fairview Polymedic Hospital.Respondent
spouses Berlino and Rosario Nabua, the parents of the victim, filed a Complaint for
damages against petitioners and the General Manager of OMC Carriers, Chito
Calauag, before the RTC of Quezon City, Branch 224. On January 19, 1998, the
RTC rendered a decision of which was in favor of the plaintiffs. The petitioners then
appealed the RTC Decision to the CA. On December 28, 1999, the CA rendered a
decision which affirmed the decision of the RTC with modifications.
ISSUES: (1) WON the OMC Carriers, Inc demonstrated the diligence of good father
of a family.
(2) WON the Court of Appeals erred when it affirmed the RTCs award of
60,000.00 as death indemnity and 100,000.00 as moral damages. In addition that
the award of attorneys fees was without legal basis.
RULING:
(1) No. the defendant company failed to produce in court any record or other
documentary proof tending to establish that it had exercised all the diligence of a
good father of a family in the selection and supervision of its drivers and buses,
notwithstanding the calls therefore by both the trial court and the opposing counsel,
argues strongly against its pretensions.
(2) Death indemnity has been fixed by jurisprudence at 50,000.00. Hence, the
amount awarded bythe RTC and the CA must be reduced accordingly. On the issue
of moral damages, prevailing jurisprudence fixes moral damages of 50,000.00 for
death. The rule on the award of attorneys fees is that there must be a justification for
the same. On this note, after reading through thetext of the CA decision, this Court
finds that the same is bereft of any findings of fact and law to justify the award of
attorneys fees.
Pnoc vs ca 8 oct. 1998
FACTS: September 21, 1977 early morning: M/V Maria Efigenia XV, owned
by Maria Efigenia Fishing Corporation on its way to Navotas, Metro Manila collided
with the vessel Petroparcel owned by the Luzon Stevedoring Corporation (LSC)
Board of Marine Inquiry, Philippine Coast Guard Commandant Simeon N. Alejandro
found Petroparcel to be at fault Maria Efigenia sued the LSC and the Petroparcel
captain, Edgardo Doruelo praying for an award of P692,680.00 representing the
value of the fishing nets, boat equipment and cargoes of M/V Maria Efigenia
XV with interest at the legal rate plus 25% as attorneys fees and later on amended
lost business opportunities. During the pendency of the case, PNOC Shipping and
Transport Corporation sought to be substituted in place of LSC as it acquired
Petroparcel. Lower Court: against PNOC ordering it to pay P6,438,048 value of the
fishing boat with interest plus P50K attorney's fees and cost of suit CA: affirmed in
toto
ISSUE: W/N the damage was adequately proven
HELD: YES. affirming with modification actual damages of P6,438,048.00 for lack
of evidentiary bases therefor. P2M nominal damages instead.
in connection with evidence which may appear to be of doubtful relevancy or
incompetency or admissibility, it is the safest policy to be liberal, not rejecting them
on doubtful or technical grounds, but admitting them unless plainly irrelevant,
immaterial or incompetent, for the reason that their rejection places them beyond the
consideration of the court.
If they are thereafter found relevant or competent, can easily be remedied by
completely discarding or ignoring them
two kinds of actual or compensatory damages:
loss of what a person already possesses (dao emergente)
failure to receive as a benefit that which would have pertained to
him
in the case of profit-earning chattels, what has to be assessed is the value of the
chattel to its owner as a going concern at the time and place of the loss, and this
means, at least in the case of ships, that regard must be had to existing and pending
engagements
If the market value of the ship reflects the fact that it is in any case virtually certain
of profitable employment, then nothing can be added to that value in respect of
charters actually lost, for to do so would be pro tanto to compensate the plaintiff
twice over.
if the ship is valued without reference to its actual future engagements and only in
the light of its profit-earning potentiality, then it may be necessary to add to the value
thus assessed the anticipated profit on a charter or other engagement which it was
unable to fulfill.
damages cannot be presumed and courts, in making an award must point out specific
facts that could afford a basis for measuring whatever compensatory or actual
damages are borne
proven through sole testimony of general manager without objection from LSC
Admissibility of evidence refers to the question of whether or not the circumstance
(or evidence) is to considered at all. On the other hand, the probative value of
evidence refers to the question of whether or not it proves an issue
Hearsay evidence whether objected to or not has no probative
value.
In the absence of competent proof on the actual damage suffered, private respondent
is `entitled to nominal damages which, as the law says, is adjudicated in order that a
right of the plaintiff, which has been violated or invaded by defendant, may be
vindicated and recognized, and not for the purpose of indemnifying the plaintiff for
any loss suffered
 awarded in every obligation arising from law, contracts, quasi-
contracts, acts or omissions punished by law, and quasi-delicts, or
in every case where property right has been invaded.
damages in name only and not in fact
amount to be awarded as nominal damages shall be equal or at
least commensurate to the injury sustained by private respondent
considering the concept and purpose of such damages
Ordinarily, the receipt of insurance payments should diminish the total value of the
vessel quoted by private respondent in his complaint considering that such payment
is causally related to the loss for which it claimed compensation.
Its failure to pay the docket fee corresponding to its increased claim for damages
under the amended complaint should not be considered as having curtailed the lower
courts jurisdiction since the unpaid docket fee should be considered as a lien on the
judgment
Candano v sugata on 13 march 2007
This is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of
Court, seeking to reverse and set aside the Court of Appeals Decision1 dated 23 May
2003 and its Resolution dated 1 April 2004, affirming with modification the Decision
of the Regional Trial Court (RTC) of Manila, Branch 20, finding Candano Shipping
Lines, Inc. (Candano Shipping) liable for the death of Melquiades Sugata-on. The
dispositive portion of the assailed decision of the appellate court reads:
IN VIEW OF ALL THE FOREGOING, the appealed decision is AFFIRMED, with
the MODIFICATION that: (1) the awarded compensation for the death of
Melquiades Sugata-on is reduced to P608,400.00; and, (2) the award of moral and
exemplary damages as well as attorneys fees is deleted. No pronouncement as to
costs.2
The factual and procedural antecedents of this instant petition are as follows:
Candano Shipping is a domestic corporation engaged in the business of coastwise
trading within the Philippines.3 On 7 March 1994, Melquiades Sugata-on was
employed by Candano Shipping as Third Marine Engineer on board its cargo vessel,
M/V David, Jr., with the monthly salary of P7,800.00.4
On 25 March 1996, M/V David, Jr. left the port of Davao City with its cargo and 20
crew members. The voyage was initially uneventful until around seven oclock in the
evening of 27 March 1996 when the vessel encountered rough seas and strong winds
while traversing the waters of Lianga Bay, Surigao del Sur, causing her to tilt at three
degrees on its starboard side. Due to the violent waves which continuously
hammered the tilting vessel, the seawaters slowly swallowed up the main deck
causing the tilting to worsen up to 30 degrees. In an effort to salvage the vessel, the
ship captain changed its course from the north to the south but the tilting continued
to grow to a dangerously high level, rendering the vessel beyond control. It was at
this point when the ship captain ordered the crew members to abandon the vessel.
Despite the efforts exerted by the crew members to save the vessel, M/V David, Jr.
sank together with her cargo at around eleven oclock in the evening at Bakulin
Point, Lianga Bay, Surigao del Sur. Among the 20 crew members, twelve survived,
one died and seven were missing. One of those who were missing was Melquiades
Sugata-on (Melquiades), the husband of herein respondent, Florentina Sugata-on,
(Florentina) as shown in the List of Surviving Crew of the Ill-Fated David, Jr.,
prepared by Candano Shipping.5
Upon learning of Melquiades fate, Florentina immediately went to the office of
Candano Shipping in Manila to claim the death benefits of her husband but it refused
to pay.
Such refusal prompted Florentina to institute on 31 January 1997, an action seeking
indemnity for the death of her husband against Candano Shipping before the RTC of
Manila, Branch 20. She grounded her case on the provision of Article 17117 of the
New Civil Code, which imposes upon the employer liability for the death of his
employee in the course of employment, even if the death is caused by a fortuitous
event. Accordingly, Florentina prayed that actual, moral and exemplary damages
including attorneys fees, be awarded in her favor.
In its Answer,9 Candano Shipping countered that Florentina had no cause of action
against it because the death of Melquiades was not yet an established fact since he
was merely reported missing upon the sinking of M/V David, Jr. The filing of the
case before the RTC therefore was premature for she should have waited until the
body of Melquiades could be recovered or until the lapse of time which would render
the provision of Article 391 of the New Civil Code10 on presumptive death
operative.
The RTC resolved the controversy in favor of Florentina and ratiocinated that the
provision of Article 391 of the New Civil Code on presumptive death had become
operative since the period of four years had already elapsed since Melquiades was
reported missing upon the sinking incident which occurred on 27 March 1996. In a
Decision11 promulgated on 15 February 2001, the RTC ordered Candano Shipping
to indemnify Florentina for the death of her husband, in the following amounts:
WHEREFORE, premises considered, judgment is hereby rendered ordering
defendant Candano Shipping Lines, Inc. to indemnify plaintiff Forentina J. Sugata-
on the amount of P988,400.00 as actual damages, P100,000.00 as moral damages
P50,000.00 as exemplary damages and 10% of the amount due as and for attorneys
fees plus the cost of suit.
The award for actual damages amounting to P988,400.00 was computed by the lower
court by adopting the formula in the computation of loss of earning capacity
enunciated in the case of Villa Rey Transit, Inc. v. Court of Appeals,12 wherein the
annual expenses of the deceased are deducted from his gross annual income and
multiplied by life expectancy (gross annual income annual expense x life
expectancy).13
The Motion for Reconsideration interposed by Candano Shipping was denied by the
RTC for lack of cogent reason to disturb or reconsider its decision.14
Aggrieved, Candano Shipping elevated the adverse RTC decision to the Court of
Appeals, which in turn, affirmed with modification the judgment of the lower court.
The award for actual damages was reduced from P998,400.00 to P608,400.00, while
the awards for moral and exemplary damages including attorneys fees were deleted
for lack of sufficient basis for their allowance.15
In arriving at the sum of P608,400.00, the appellate court applied the standard
prescribed by Article 194 of the Labor Code of the Philippines, as amended, to wit:
ART. 194. DEATH. (a) Under such regulations as the Commission may approve,
the System shall pay to the primary beneficiaries upon the death of the covered
employee under this Title an amount equivalent to his monthly income benefit, plus
ten percent thereof for each dependent child, but not exceeding five, beginning with
the youngest and without substitution, except as provided for in paragraph (j) of
Article 167 hereof; Provided, however, That the monthly income benefit shall be
guaranteed for five years: Provided, further, That if he has no primary beneficiary,
the System shall pay to his secondary beneficiaries the monthly income benefit not to
exceed sixty months; Provided, finally, That the minimum monthly death benefit
shall not be less that fifteen thousand pesos.
In a Resolution16 issued on 1 April 2004, the Court of Appeals denied the Motion
for Reconsideration filed by Candano Shipping for failure to offer any justifiable
ground to modify, reverse or reconsider the questioned decision.
Hence, this instant Petition for Review on Certiorari filed by Candano Shipping
raising the following issues:
WHETHER OR NOT THE FORMULA FOR FIXING THE AMOUNT OF DEATH
COMPENSATION IN ARTICLE 194 OF THE LABOR CODE APPLIES IN
DETERMINING THE COMPENSATION CLAIMED BY THE HEIR OF THE
DECEASED EMPLOYEE AGAINST THE EMPLOYER UNDER ARTICLE 1711?
WHETHER OR NOT IT IS PERMITTED FOR THE COURT OF APPEALS, ON
ORDINARY APPEAL, TO APPLY ART. 194 OF THE LABOR CODE ON A
CLAIM FOR DEATH COMPENSATION OF AN EMPLOYEE AGAINST THE
EMPLOYER FILED AND TRIED BEFORE THE REGULAR COURTS ON THE
BASIS OF ARTICLE 1711 OF THE CIVIL CODE AND THE DOCTRINE
ENUNCIATED IN THE VILLA REY TRANSIT CASE?
WHETHER OR NOT APPLICATION OF ARTICLE 194 OF THE LABOR CODE
ON THE CLAIM FOR DEATH COMPENSATION OF RESPONDENT OUSTS
THE REGULAR COURTS, INCLUDING THE COURT OF APPEALS OF
JURISDICTION OVER THE CASE?
IN THE EVENT THAT THE SUPREME COURT RULES THAT THE COURT OF
APPEALS APPLICATION OF ARTICLE 194 OF THE LABOR CODE IN THIS
CASE SHOULD BE SET ASIDE, IS RESPONDENT ENTITLED TO RECOVER
DEATH COMPENSATION FROM PETITIONER IN ACCORDANCE WITH HER
THEORY OF THE CASE AS ALLEGED, ARGUED AND TRIED BEFORE THE
TRIAL COURT.17
Since the factual findings of the RTC and the Court of Appeals that the non-recovery
of Melquiades body for the period of four (4) years from 27 March 1996 creates a
presumption that he is already dead and that his death was caused by a fortuitous
event, were already settled, and considering that these findings were not controverted
by the parties in this instant petition, we find no compelling reason to disturb the
same. Henceforth, we will limit our discussion to the computation of the amount of
indemnification.
In its Petition, Candano Shipping argues that the application of the measure
stipulated under Article 194 of the Labor Code is erroneous since it applies only to
death compensation to be paid by the Social Security System to the beneficiaries of a
deceased member, to which proposition Florentina concedes. We agree. The remedy
availed by Sugata-on in filing the claim under the New Civil Code has been validly
recognized by the prevailing jurisprudence on the matter.
In the case of Floresca v. Philex Mining Company,18 we declared that the employees
may invoke either the Workmens Compensation Act or the provisions of the Civil
Code, subject to the consequence that the choice of one remedy will exclude the
other and that the acceptance of the compensation under the remedy chosen will
exclude the other remedy. The exception is where the claimant who had already been
paid under the Workmens Compensation Act may still sue for damages under the
Civil Code on the basis of supervening facts or developments occurring after he
opted for the first remedy.
Stated differently, save for the recognized exception, an employee cannot pursue
both remedies simultaneously but has the option to proceed by interposing one
remedy and waiving his right over the other. As we have explained in Floresca, this
doctrinal rule is rooted on the theory that the basis of the compensation under the
Workmens Compensation Act is separate and distinct from the award of damages
under the Civil Code, thus:
The rationale in awarding compensation under the Workmens Compensation Act
differs from that in giving damages under the Civil Code. The compensation acts are
based on a theory of compensation distinct from the existing theories of damages,
payments under the acts being made as compensation and not as damages (99 C.J.S.
53). Compensation is given to mitigate harshness and insecurity of industrial life for
the workman and his family. Hence, an employer is liable whether negligence exists
or not since liability is created by law. Recovery under the Act is not based on any
theory of actionable wrong on the part of the employer (99 D.J.S. 36).
In other words, under compensation acts, the employer is liable to pay compensation
benefits for loss of income, as long as the death, sickness or injury is work-connected
or work-aggravated, even if the death or injury is not due to the fault of the employer
(Murillo v. Mendoza, 66 Phil. 689). On the other hand, damages are awarded to one
as a vindication of the wrongful invasion of his rights. It is the indemnity recoverable
by a person who has sustained injury either in his person, property or relative rights,
through the act or default of another (25 C.J.S. 452).
The principle underscored in the case of Floresca was further affirmed in the later
case of Ysmael Maritime Corporation v. Avelino,20 wherein we emphasized that
once the claimant had already exercised his choice to pursue his right under one
remedy, he is barred from proceeding with an alternative remedy. As eloquently laid
down by Chief Justice Marcelo Fernan:
It is therefore clear that respondents had not only opted to recover under the Act but
they had also been duly paid. At the very least, a sense of fair play would demand
that if a person entitled to a choice of remedies made a first election and accepted the
benefits thereof, he should no longer be allowed to exercise the second option.
"Having staked his fortunes on a particular remedy, (he) is precluded from pursuing
the alternate course, at least until the prior claim is rejected by the Compensation
Commission."
In the case at bar, Florentina was forced to institute a civil suit for indemnity under
the New Civil Code, after Candano Shipping refused to compensate her husbands
death.
The pertinent provision of the New Civil Code reads:
Article 1711. Owners of enterprises and other employers are obliged to pay
compensation for the death of or injuries to their laborers, workmen, mechanics or
other employees, even though the event may have been purely accidental or entirely
due to a fortuitous cause, if the death or personal injury arose out of and in the course
of employment. The employer is also liable for compensation if the employee
contracts any illness or diseases caused by such employment or as the result of the
nature of employment. If the mishap was due to the employees own notorious
negligence, or voluntary act, or drunkenness, the employer shall not be liable for
compensation. When the employees lack of due care contributed to his death or
injury, the compensation shall be equitably reduced
In the case of Philippine Air Lines, Inc. v. Court of Appeals,21 this Court validated
the strength of the aforementioned provision and made the employer liable for the
injury suffered by its employee in the course of employment. We thus ruled:
Having affirmed the gross negligence of PAL in allowing Capt. Delfin Bustamante
to fly the plane to Daet on January 8, 1951 whose slow reaction and poor judgment
was the cause of the crash-landing of the plane which resulted in private respondent
Samson hitting his head against the windshield and causing him injuries for which
reason PAL terminated his services and employment as pilot after refusing to
provide him with the necessary medical treatment of respondents periodic spells,
headache and general debility produced from said injuries, We must necessarily
affirm likewise the award of damages or compensation under the provisions of Art.
1711 and Art. 1712 of the New Civil Code. x x x.
As early as the case of Valencia v. Manila Yacht Club, Inc.,22 this Court, speaking
through the renowned civilist, Mr. Justice J.B.L. Reyes, made a pronouncement that
Article 1711 of the Civil Code imposes upon the employer the obligation to
compensate the employee for injury or sickness occasioned by his employment, and
thus articulated:
>Appellants demand for compensation is predicated on employers liability for the
sickness of, or injury to, his employee imposed by Article 1711 of the Civil Code,
which reads:
Article 1711. Owners of enterprises and other employers are obliged to pay
compensation for the death x x x.
We find the abovequoted provision to be applicable and controlling in this case. The
matter of the amount of compensation and allowable medical expenses should be
properly determined by the Municipal Court after the parties are heard accordingly.
Given that the right of the claimant arose from the contract of employment and the
corresponding obligation imposed by the New Civil Code upon the employer to
indemnify the former for death and injury of the employee circumstanced by his
employment, necessarily, the provisions of the same code on damages shall govern
the extent of the employers liability.
The pertinent provision on damages under the New Civil Code provides:
Art. 2199. 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.
Article 2200. Indemnification for damages shall comprehend not only the value of
the loss suffered, but also that of the profits which the obligee failed to obtain.
In order to give breath to the aforestated provisions on damages of the New Civil
Code, they must be transformed into a more tangible and practical mathematical
form, so that the purpose of the law to indemnify the employee or his heirs for his
death or injury occasioned by his employment, as envisioned by the Article 1711 of
the same code may be realized. We deem it best to adopt the formula for loss of
earning capacity enunciated in the case of Villa Rey v. Court of Appeals,23 in
computing the amount of actual damages to be awarded to the claimant under Article
1711 of the New Civil Code.
In Villa Rey, the common carrier was made liable for the death of its passenger on
board a passenger bus owned and operated by Villa Rey Transit, Inc. going to
Manila from Lingayen, Pangasinan. While the bus was nearing Sadsaran Bridge in
Barrio Sto. Domingo, Minalin, Pampanga, it frontally hit the rear side of bull cart
filled with hay and bamboo poles. The protruding end of one bamboo pole, about
eight feet long, penetrated through the glass windshield of the bus and hit the face of
Policarpio Quintos, Jr., who was then sitting at the front row, causing his death.24
The obligation of the common carrier to indemnify its passenger or his heirs for
injury or death arose from the contract of carriage entered into by the common
carrier and the passenger.25 By the very nature of the obligation which is imbued
with public interest,26 in contract of carriage the carrier assumes the express
obligation to transport its passenger to his destination safely and to observe
extraordinary diligence with due regard to all the circumstances, and any injury that
might be suffered by the passenger is right away attributable to the fault or
negligence of the carrier and thus gives rise to the right of the passenger or his heirs
for indemnity.27
In the same breadth, the employer shall be liable for the death or personal injury of
its employees in the course of employment as sanctioned by Article 1711 of the New
Civil Code. The liability of the employer for death or personal injury of his
employees arose from the contract of employment entered into between the employer
and his employee which is likewise imbued with public interest.28 Accordingly,
when the employee died or was injured in the occasion of employment, the
obligation of the employer for indemnity, automatically attaches. The indemnity may
partake of the form of actual, moral, nominal, temperate, liquidated or exemplary
damages, as the case may be depending on the factual milieu of the case and
considering the criterion for the award of these damages as outlined by our
jurisprudence.29 In the case at bar, only the award of actual damages, specifically
the award for unearned income is warranted by the circumstances since it has been
duly proven that the cause of death of Melquiades is a fortuitous event for which
Candano Shipping cannot be faulted.
The formula for the computation of unearned income is:
Net Earning Capacity = life expectancy x (gross annual income - reasonable and
necessary living expenses).
Life expectancy is determined in accordance with the formula:
2 / 3 x [80 age of deceased at the time of death]
Jurisprudence provides that the first factor, i.e., life expectancy, shall be computed
by applying the formula (2/3 x [80 - age at death]) adopted in the American
Expectancy Table of Mortality or the Actuarial of Combined Experience Table of
Mortality.30
In the computation of the second factor, it is computed by multiplying the life
expectancy by the net earnings of the deceased, i.e., the total earnings less expenses
necessary in the creation of such earnings or income and less living and other
incidental expenses.31 The loss is not equivalent to the entire earnings of the
deceased, but only such portion that he would have used to support his dependents or
heirs. Hence, we deduct from his gross earnings the necessary expenses supposed to
be used by the deceased for his own needs.32 The Court explained in Villa
Rey:1avvphi1
[(The award of damages for loss of earning capacity is)] concerned with the
determination of losses or damages sustained by the private respondents, as
dependents and intestate heirs of the deceased, and that said damages consist, not of
the full amount of his earnings, but of the support they received or would have
received from him had he not died in consequence of negligence of petitioners
agent. In fixing the amount of that support, we must reckon with the necessary
expenses of his own living, which should be deducted from his earnings. Thus, it
has been consistently held that earning capacity, as an element of damages to ones
estate for his death by wrongful act is necessarily his net earning capacity or his
capacity to acquire money, less necessary expense for his own living. Stated
otherwise, the amount recoverable is not the loss of entire earning, but rather the loss
of that portion of the earnings which the beneficiary would have received. In other
words, only net earnings, and not gross earnings are to be considered that is, the total
of the earnings less expenses necessary in the creation of such earnings or income
and less living and other incidental expenses.33
In computing the third factor, the necessary living expense, a survey of more recent
jurisprudence shows that this Court consistently pegged the amount at 50% of the
gross annual income.34 We held in Smith Bell Dodwell Shipping Agency Corp. v.
Borja,35 that when there is no showing that the living expenses constituted the
smaller percentage of the gross income, we fix the living expenses at half of the
gross income.
Applying the aforestated jurisprudential guidelines in the computation of the amount
of award for damages set out in Villa Rey, we now proceed to determining
Melquiades life expectancy, thus:
Life expectancy = 2 / 3 x [80 age of deceased at the time of death]
2 /3 x [80 56]
2 / 3 x [24]
Life expectancy = 16
With 16 more years of life expectancy and a monthly income of P7,800.00, as
evidenced by the pay slips duly presented before the RTC, Melquiades earning
capacity is computed as follows:
Net Earning Capacity = life expectancy x (gross annual income - reasonable and
necessary living expenses).
= 16 x ( P93,600.00 P 46,800.00)
= 16 x ( P 46,800.00 )
Net Earning Capacity = P 748,800.00
The argument raised by Candano Shipping that the formula for determining the life
expectancy under Villa Rey cannot be automatically applied without proof of the
basis for the expected length of life of a Filipino does not merit our consideration.
The formula for life expectancy has been repeatedly adopted in our jurisprudence in
fixing the amount of indemnity for the death of a party. This was adopted from the
American Expectancy Table of Mortality or the Actuarial of Combined Experience
Table of Mortality which was used by insurers in determining the capital sum to be
charged for annuity.
Admittedly, in several cases, this Court reduced the life expectancy multiplier
considering the medical history such as when the deceased previously underwent a
major surgery37 or when it was shown that he was treated for chest pains, backache
or occasional feeling of tiredness38 and the fact that the deceased has been
consistently engaged in a dangerous and risky activity tending to shorten his life.39
Failing to prove, however, that any of these circumstances is attendant in the case at
bar, Candano Shipping cannot validly assert that the standard life expectancy factor
laid down in Villa Rey cannot be applied in this case.
Accordingly, Florentina is entitled to recover the amount of P748,800.00 as actual
damages for the death of her husband. The awards of moral and exemplary damages
are deleted. However, the award of costs of litigation and attorneys fees are
proper.40
WHEREFORE, in view of the foregoing, the instant petition is DENIED and the
Decision dated 23 May 2003 as well as the Resolution dated 1 April 2004, rendered
by the Court of Appeals in CA-G.R. CV No. 70410, are hereby PARTIALLY
AFFIRMED in so far as it finds petitioner liable to respondent for damages.
Pursuant to the appropriate provisions of the New Civil Code and the prevailing
jurisprudence on the matter, petitioner Candano Shipping Lines, Inc., is ORDERED
to pay the amount of P748,800.00, as actual damages, plus 10% of the amount
awarded as attorneys fee plus cost of the suit.
Villa rey transit v ca 18 feb 1970
Petitioner, Villa Rey Transit, Inc., seeks the review by certiorari of a decision of the
Court of Appeals affirming that of the Court of First Instance of Pangasinan. The basic
facts are set forth in said decision of the Court of Appeals, from which
We quote:
At about 1:30 in the morning of March 17, 1960, an Izuzu First Class passenger bus
owned and operated by the defendant, bearing Plate No. TPU-14871-Bulacan and
driven by Laureano Casim, left Lingayen, Pangasinan, for Manila. Among its paying
passengers was the deceased, Policronio Quintos, Jr. who sat on the first seat, second
row, right side of the bus. At about 4:55 o'clock a.m. when the vehicle was nearing the
northern approach of the Sadsaran Bridge on the national highway in barrio Sto.
Domingo, municipality of Minalin, Pampanga, it frontally hit the rear side of a bullcart
filled with hay. As a result the end of a bamboo pole placed on top of the hayload and
tied to the cart to hold it in place, hit the right side of the windshield of the bus. The
protruding end of the bamboo pole, about 8 feet long from the rear of the bullcart,
penetrated through the glass windshield and landed on the face of Policronio Quintos,
Jr. who, because of the impact, fell from his seat and was sprawled on the floor. The
pole landed on his left eye and the bone of the left side of his face was fractured. He
suffered other multiple wounds and was rendered unconscious due, among other
causes to severe cerebral concussion. A La Mallorca passenger bus going in the
opposite direction towards San Fernando, Pampanga, reached the scene of the mishap
and it was stopped by Patrolman Felino Bacani of the municipal police force of
Minalin who, in the meantime, had gone to the scene to investigate. Patrolman Bacani
placed Policronio Quintos, Jr. and three other injured men who rode on the bullcart
aboard the La Mallorca bus and brought them to the provincial hospital of Pampanga
at San Fernando for medical assistance. Notwithstanding such assistance, Policronio
Quintos, Jr. died at 3:15 p.m. on the same day, March 17, 1960, due to traumatic shock
due to cerebral injuries.
The private respondents, Trinidad, Prima and Julita, all surnamed Quintos, are the
sisters and only surviving heirs of Policronio Quintos Jr., who died single, leaving no
descendants nor ascendants. Said respondents herein brought this action against herein
petitioner, Villa Rey Transit, Inc., as owner and operator of said passenger bus, bearing
Plate No. TPU-14871-Bulacan, for breach of the contract of carriage between said
petitioner and the deceased Policronio Quintos, Jr., to recover the aggregate sum of
P63,750.00 as damages, including attorney's fees. Said petitioner defendant in the
court of first instance contended that the mishap was due to a fortuitous event, but
this pretense was rejected by the trial court and the Court of Appeals, both of which
found that the accident and the death of Policronio had been due to the negligence of
the bus driver, for whom petitioner was liable under its contract of carriage with the
deceased. In the language of His Honor, the trial Judge:
The mishap was not the result of any unforeseeable fortuitous event or emergency but
was the direct result of the negligence of the driver of the defendant. The defendant
must, therefore, respond for damages resulting from its breach of contract for carriage.
As the complaint alleged a total damage of only P63,750.00 although as elsewhere
shown in this decision the damages for wake and burial expenses, loss of income,
death of the victim, and attorneys fee reach the aggregate of P79,615.95, this Court
finds it just that said damages be assessed at total of only P63,750.00 as prayed for in
plaintiffs' amended complaint. The despositive part of the decision of the trial Court
reads: WHEREFORE, judgment is hereby rendered ordering the defendant to pay to
the plaintiffs the amount of P63,750.00 as damages for breach of contract of carriage
resulting from the death of Policronio Quintos, Jr.which, as above indicated, was
affirmed by the Court of Appeals. Hence, the present petition for review on certiorari,
filed by Villa Rey Transit, Inc.The only issue raised in this appeal is the amount of
damages recoverable by private respondents herein. The determination of such amount
depends, mainly upon two (2) factors, namely: (1) the number of years on the basis of
which the damages shall be computed and (2) the rate at which the losses sustained by
said respondents should be fixed. The first factor was based by the trial court the
view of which was concurred in by the Court of Appeals upon the life expectancy
of Policronio Quintos, Jr., which was placed at 33-1/3 years he being over 29 years
of age (or around 30 years for purposes of computation) at the time of his demise
by applying the formula (2/3 x [80-301 = life expectancy) adopted in the American
Expectancy Table of Mortality or the actuarial of Combined Experience Table of
Mortality. Upon the other hand, petitioner maintains that the lower courts had erred in
adopting said formula and in not acting in accordance with Alcantara v. Surro1 in
which the damages were computed on a four (4) year basis, despite the fact that the
victim therein was 39 years old, at the time of his death, and had a life expectancy of
28.90 years.
The case cited is not, however, controlling in the one at bar. In the Alcantara
case, none of the parties had questioned the propriety of the four-year basis adopted
by the trial court in making its award of damages. Both parties appealed, but only as
regards the amount thereof. The plaintiffs assailed the non-inclusion, in its
computation, of the bonus that the corporation, which was the victim's employer, had
awarded to deserving officers and employees, based upon the profits earned less than
two (2) months before the accident that resulted in his death. The defendants, in turn,
objected to the sum awarded for the fourth year, which was treble that of the previous
years, based upon the increases given, in that fourth year, to other employees of the
same corporation. Neither this objection nor said claim for inclusion of the bonus was
sustained by this Court. Accordingly, the same had not thereby laid down any rule on
the length of time to be used in the computation of damages. On the contrary, it
declared:
The determination of the indemnity to be awarded to the heirs of a deceased person
has therefore no fixed basis. Much is left to the discretion of the court considering the
moral and material damages involved, and so it has been said that "(t)here can be no
exact or uniform rule for measuring the value of a human life and the measure of
damages cannot be arrived at by precise mathematical calculation, but the amount
recoverable depends on the particular facts and circumstances of each case. The life
expectancy of the deceased or of the beneficiary, whichever is shorter, is an important
factor.' (25 C.J.S. 1241.) Other factors that are usually considered are: (1) pecuniary
loss to plaintiff or beneficiary (25 C.J.S. 1243-1250) ; (2) loss of support (25 C.J.S.,
1250-1251); (3) loss of service (25 C.J.S. 1251-1254); (4) loss of society (25 C.J.S.
1254-1255); (5) mental suffering of beneficiaries (25 C.J.S., 1258-1259) ; and (6)
medical and funeral expenses (26 C.J.S., 1254-1260)."2
Thus, life expectancy is, not only relevant, but, also, an important element in fixing
the amount recoverable by private respondents herein. Although it is not
the sole element determinative of said amount, no cogent reason has been given to
warrant its disregard and the adoption, in the case at bar, of a purely arbitrary standard,
such as a four-year rule. In short, the Court of Appeals has not erred in basing the
computation of petitioner's liability upon the life expectancy of Policronio Quintos, Jr.
With respect to the rate at which the damages shall be computed, petitioner impugns
the decision appealed from upon the ground that the damages awarded therein will
have to be paid now, whereas most of those sought to be indemnified will be
suffered years later. This argument is basically true, and this is, perhaps, one of the
reasons why the Alcantara case points out the absence of a "fixed basis" for the
ascertainment of the damages recoverable in litigations like the one at bar. Just the
same, the force of the said argument of petitioner herein is offset by the fact that,
although payment of the award in the case at bar will have to take place upon the
finality of the decision therein, the liability of petitioner herein had been fixed at the
rate only of P2,184.00 a year, which is the annual salary of Policronio Quintos, Jr. at
the time of his death, as a young "training assistant" in the Bacnotan Cement
Industries, Inc. In other words, unlike the Alcantara case, on which petitioner relies,
the lower courts did not consider, in the present case, Policronio's potentiality and
capacity to increase his future income. Indeed, upon the conclusion of
his training period, he was supposed to have a better job and be promoted from time
to time, and, hence, to earn more, if not considering the growing importance of
trade, commerce and industry and the concomitant rise in the income level of officers
and employees therein much more.
At this juncture, it should be noted, also, that We are mainly concerned with the
determination of the losses or damages sustained by the private respondents, as
dependents and intestate heirs of the deceased, and that said damages consist, not of
the full amount of his earnings, but of the support, they received or would have
received from him had he not died in consequence of the negligence of petitioner's
agent. In fixing the amount of that support, We must reckon with the "necessary
expenses of his own living", which should be deducted from his earnings. Thus, it has
been consistently held that earning capacity, as an element of damages to one's estate
for his death by wrongful act is necessarily his net earning capacity or his capacity to
acquire money, "less the necessary expense for his own living.3 Stated otherwise, the
amount recoverable is not loss of the entire earning, but rather the loss of
that portion of the earnings which the beneficiary would have received.4 In other
words, only net earnings, not gross earning, are to be considered 5 that is, the total of
the earnings less expenses necessary in the creation of such earnings or income 6 and
less living and other incidental expenses.7
All things considered, We are of the opinion that it is fair and reasonable to fix the
deductible living and other expenses of the deceased at the sum of P1,184.00 a year,
or about P100.00 a month, and that, consequently, the loss sustained by his sisters may
be roughly estimated at P1,000.00 a year or P33,333.33 for the 33-1/3 years of his life
expectancy. To this sum of P33,333.33, the following should be added: (a) P12,000.00,
pursuant to Arts. 104 and 107 of the Revised Penal Code, in relation to Article 2206
of our Civil Code, as construed and applied by this Court; 8 (b) P1,727.95, actually
spent by private respondents for medical and burial expenses; and (c) attorney's fee,
which was fixed by the trial court, at P500.00, but which, in view of the appeal taken
by petitioner herein, first to the Court of Appeals and later to this Supreme Court,
should be increased to P2,500.00. In other words, the amount adjudged in the decision
appealed from should be reduced to the aggregate sum of P49,561.28, with interest
thereon, at the legal rate, from December 29, 1961, date of the promulgation of the
decision of the trial court.
Thus modified, said decision and that of the Court of Appeals are hereby affirmed, in
all other respects, with costs against petitioner, Villa Rey Transit, Inc. It is so ordered.
Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Fernando, Teehankee,
Barredo and Villamor, JJ., concur.
SPOUSES ZALAMEA and LIANA ZALAMEA vs. CA and TRANSWORLD
AIRLINES, INC. G.R. No. 104235 November 18, 1993
FACTS:
Petitioners-spouses Cesar Zalamea and Suthira Zalamea, and their daughter, Liana
purchased 3 airline tickets from the Manila agent of respondent TransWorld Airlines,
Inc. for a flight to New York to Los Angeles. The tickets of petitioners-spouses were
purchased at a discount of 75% while that of their daughter was a full fare ticket. All
three tickets represented confirmed reservations.
On the appointed date, however, petitioners checked in but were placed on the wait-
list because the number of passengers who had checked in before them had already
taken all the seats available on the flight. Out of the 42 names on the wait list, the
first 22 names were eventually allowed to board the flight to Los Angeles, including
petitioner Cesar Zalamea. The two others were not able to fly. Those holding full-
fare tickets were given first priority among the wait-listed passengers. Mr. Zalamea,
who was holding the full-fare ticket of his daughter, was allowed to board the plane;
while his wife and daughter, who presented the discounted tickets were denied
boarding.
Even in the next TWA flight to Los Angeles Mrs. Zalamea and her daughter, could
not be accommodated because it was also fully booked. Thus, they were constrained
to book in another flight and purchased two tickets from American Airlines. Upon
their arrival in the Philippines, petitioners filed an action for damages based on
breach of contract of air carriage before the RTC- Makati. The lower court ruled in
favor of petitioners . CA held that moral damages are recoverable in a damage suit
predicated upon a breach of contract of carriage only where there is fraud or bad
faith. Since it is a matter of record that overbooking of flights is a common and
accepted practice of airlines in the United States and is specifically allowed under the
Code of Federal Regulations by the Civil Aeronautics Board, no fraud nor bad faith
could be imputed on respondent TransWorld Airlines. Thus petitioners raised the
case on petition for review on certiorari.
ISSUE;
WON TWZ acted with bad faith and would entitle Zalameas to Moral and
Examplary damages.
RULING:
The U.S. law or regulation allegedly authorizing overbooking has never been proved.
Foreign laws do not prove themselves nor can the courts take judicial notice of them.
Like any other fact, they must be alleged and proved. Written law may be evidenced
by an official publication thereof or by a copy attested by the officer having the legal
custody of the record, or by his deputy, and accompanied with a certificate that such
officer has custody. The certificate may be made by a secretary of an embassy or
legation, consul general, consul, vice-consul, or consular agent or by any officer in
the foreign service of the Philippines stationed in the foreign country in which the
record is kept, and authenticated by the seal of his office.
Respondent TWA relied solely on the statement of Ms. Gwendolyn Lather, its
customer service agent, in her deposition that the Code of Federal Regulations of the
Civil Aeronautics Board allows overbooking. No official publication of said code
was presented as evidence. Thus, respondent courts finding that overbooking is
specifically allowed by the US Code of Federal Regulations has no basis in fact.
Even if the claimed U.S. Code of Federal Regulations does exist, the same is not
applicable to the case at bar in accordance with the principle of lex loci contractus
which require that the law of the place where the airline ticket was issued should be
applied by the court where the passengers are residents and nationals of the forum
and the ticket is issued in such State by the defendant airline. Since the tickets were
sold and issued in the Philippines, the applicable law in this case would be Philippine
law. Existing jurisprudence explicitly states that overbooking amounts to bad faith,
entitling the passengers concerned to an award of moral damages. In Alitalia
Airways v. Court of Appeals, where passengers with confirmed bookings were
refused carriage on the last minute, this Court held that when an airline issues a
ticket to a passenger confirmed on a particular flight, on a certain date, a contract of
carriage arises, and the passenger has every right to expect that he would fly on that
flight and on that date. If he does not, then the carrier opens itself to a suit for breach
of contract of carriage. Where an airline had deliberately overbooked, it took the risk
of having to deprive some passengers of their seats in case all of them would show
up for the check in. For the indignity and inconvenience of being refused a
confirmed seat on the last minute, said passenger is entitled to an award of moral
damages. For a contract of carriage generates a relation attended with public duty
a duty to provide public service and convenience to its passengers which must be
paramount to self-interest or enrichment.
Respondent TWA is still guilty of bad faith in not informing its passengers
beforehand that it could breach the contract of carriage even if they have confirmed
tickets if there was overbooking. Respondent TWA should have incorporated
stipulations on overbooking on the tickets issued or to properly inform its passengers
about these policies so that the latter would be prepared for such eventuality or
would have the choice to ride with another airline.
Respondent TWA was also guilty of not informing its passengers of its alleged
policy of giving less priority to discounted tickets. Neither did it present any
argument of substance to show that petitioners were duly apprised of the overbooked
condition of the flight or that there is a hierarchy of boarding priorities in booking
passengers. It is evident that petitioners had the right to rely upon the assurance of
respondent TWA, thru its agent in Manila, then in New York, that their tickets
represented confirmed seats without any qualification. The failure of respondent
TWA to so inform them when it could easily have done so thereby enabling
respondent to hold on to them as passengers up to the last minute amounts to bad
faith. Evidently, respondent TWA placed its self-interest over the rights of
petitioners under their contracts of carriage. Such conscious disregard of petitioners
rights makes respondent TWA liable for moral damages. To deter breach of contracts
by respondent TWA in similar fashion in the future, we adjudge respondent TWA
liable for exemplary damages, as well.
In the case of Alitalia Airways v. Court of Appeals, this Court explicitly held that a
passenger is entitled to be reimbursed for the cost of the tickets he had to buy for a
flight to another airline. Thus, instead of simply being refunded for the cost of the
unused TWA tickets, petitioners should be awarded the actual cost of their flight
from New York to Los Angeles.
WHEREFORE, the petition is hereby GRANTED and the decision of the respondent
Court of Appeals is hereby MODIFIED
Bpi family bank v franco 23 nov 2007
Banks are exhorted to treat the accounts of their depositors with meticulous care and
utmost fidelity. We reiterate this exhortation in the case at bench.
This case has its genesis in an ostensible fraud perpetrated on the petitioner BPI Family
Bank (BPI-FB) allegedly by respondent Amado Franco (Franco) in conspiracy with
other individuals,3 some of whom opened and maintained separate accounts with BPI-
FB, San Francisco del Monte (SFDM) branch, in a series of transactions.
On August 15, 1989, Tevesteco Arrastre-Stevedoring Co., Inc. (Tevesteco) opened a
savings and current account with BPI-FB. Soon thereafter, or on August 25, 1989,
First Metro Investment Corporation (FMIC) also opened a time deposit account with
the same branch of BPI-FB with a deposit of P100,000,000.00, to mature one year
thence.
Subsequently, on August 31, 1989, Franco opened three accounts, namely, a
current,4 savings,5 and time deposit,6 with BPI-FB. The current and savings accounts
were respectively funded with an initial deposit of P500,000.00 each, while the time
deposit account had P1,000,000.00 with a maturity date of August 31, 1990. The total
amount of P2,000,000.00 used to open these accounts is traceable to a check issued by
Tevesteco allegedly in consideration of Francos introduction of Eladio Teves, 7 who
was looking for a conduit bank to facilitate Tevestecos business transactions, to Jaime
Sebastian, who was then BPI-FB SFDMs Branch Manager. In turn, the funding for
the P2,000,000.00 check was part of the P80,000,000.00 debited by BPI-FB from
FMICs time deposit account and credited to Tevestecos current account pursuant to
an Authority to Debit purportedly signed by FMICs officers.
It appears, however, that the signatures of FMICs officers on the Authority to Debit
were forged.8 On September 4, 1989, Antonio Ong,9 upon being shown the Authority
to Debit, personally declared his signature therein to be a forgery. Unfortunately,
Tevesteco had already effected several withdrawals from its current account (to which
had been credited the P80,000,000.00 covered by the forged Authority to Debit)
amounting to P37,455,410.54, including the P2,000,000.00 paid to Franco.
On September 8, 1989, impelled by the need to protect its interests in light of FMICs
forgery claim, BPI-FB, thru its Senior Vice-President, Severino Coronacion,
instructed Jesus Arangorin10 to debit Francos savings and current accounts for the
amounts remaining therein.11 However, Francos time deposit account could not be
debited due to the capacity limitations of BPI-FBs computer.12
In the meantime, two checks13 drawn by Franco against his BPI-FB current account
were dishonored upon presentment for payment, and stamped with a notation "account
under garnishment." Apparently, Francos current account was garnished by virtue of
an Order of Attachment issued by the Regional Trial Court of Makati (Makati RTC)
in Civil Case No. 89-4996 (Makati Case), which had been filed by BPI-FB against
Franco et al.,14 to recover the P37,455,410.54 representing Tevestecos total
withdrawals from its account.
Notably, the dishonored checks were issued by Franco and presented for payment at
BPI-FB prior to Francos receipt of notice that his accounts were under
garnishment.15 In fact, at the time the Notice of Garnishment dated September 27,
1989 was served on BPI-FB, Franco had yet to be impleaded in the Makati case where
the writ of attachment was issued.
It was only on May 15, 1990, through the service of a copy of the Second Amended
Complaint in Civil Case No. 89-4996, that Franco was impleaded in the Makati
case.16 Immediately, upon receipt of such copy, Franco filed a Motion to Discharge
Attachment which the Makati RTC granted on May 16, 1990. The Order Lifting the
Order of Attachment was served on BPI-FB on even date, with Franco demanding the
release to him of the funds in his savings and current accounts. Jesus Arangorin, BPI-
FBs new manager, could not forthwith comply with the demand as the funds, as
previously stated, had already been debited because of FMICs forgery claim. As such,
BPI-FBs computer at the SFDM Branch indicated that the current account record was
"not on file."
With respect to Francos savings account, it appears that Franco agreed to an
arrangement, as a favor to Sebastian, whereby P400,000.00 from his savings account
was temporarily transferred to Domingo Quiaoits savings account, subject to its
immediate return upon issuance of a certificate of deposit which Quiaoit needed in
connection with his visa application at the Taiwan Embassy. As part of the
arrangement, Sebastian retained custody of Quiaoits savings account passbook to
ensure that no withdrawal would be effected therefrom, and to preserve Francos
deposits.
On May 17, 1990, Franco pre-terminated his time deposit account. BPI-FB deducted
the amount of P63,189.00 from the remaining balance of the time deposit account
representing advance interest paid to him.
These transactions spawned a number of cases, some of which we had already
resolved.
FMIC filed a complaint against BPI-FB for the recovery of the amount
of P80,000,000.00 debited from its account.17 The case eventually reached this Court,
and in BPI Family Savings Bank, Inc. v. First Metro Investment Corporation, 18 we
upheld the finding of the courts below that BPI-FB failed to exercise the degree of
diligence required by the nature of its obligation to treat the accounts of its depositors
with meticulous care. Thus, BPI-FB was found liable to FMIC for the debited amount
in its time deposit. It was ordered to pay P65,332,321.99 plus interest at 17% per
annum from August 29, 1989 until fully restored. In turn, the 17% shall itself earn
interest at 12% from October 4, 1989 until fully paid.
In a related case, Edgardo Buenaventura, Myrna Lizardo and Yolanda Tica
(Buenaventura, et al.),19 recipients of a P500,000.00 check proceeding from
the P80,000,000.00 mistakenly credited to Tevesteco, likewise filed suit.
Buenaventura et al., as in the case of Franco, were also prevented from effecting
withdrawals20 from their current account with BPI-FB, Bonifacio Market, Edsa,
Caloocan City Branch. Likewise, when the case was elevated to this Court docketed
as BPI Family Bank v. Buenaventura,21 we ruled that BPI-FB had no right to freeze
Buenaventura, et al.s accounts and adjudged BPI-FB liable therefor, in addition to
damages.
Meanwhile, BPI-FB filed separate civil and criminal cases against those believed to
be the perpetrators of the multi-million peso scam.22 In the criminal case, Franco,
along with the other accused, except for Manuel Bienvenida who was still at large,
were acquitted of the crime of Estafa as defined and penalized under Article 351, par.
2(a) of the Revised Penal Code.23 However, the civil case24 remains under litigation
and the respective rights and liabilities of the parties have yet to be adjudicated.
Consequently, in light of BPI-FBs refusal to heed Francos demands to unfreeze his
accounts and release his deposits therein, the latter filed on June 4, 1990 with the
Manila RTC the subject suit. In his complaint, Franco prayed for the following reliefs:
(1) the interest on the remaining balance25 of his current account which was eventually
released to him on October 31, 1991; (2) the balance 26 on his savings account, plus
interest thereon; (3) the advance interest27 paid to him which had been deducted when
he pre-terminated his time deposit account; and (4) the payment of actual, moral and
exemplary damages, as well as attorneys fees.
BPI-FB traversed this complaint, insisting that it was correct in freezing the accounts
of Franco and refusing to release his deposits, claiming that it had a better right to the
amounts which consisted of part of the money allegedly fraudulently withdrawn from
it by Tevesteco and ending up in Francos accounts. BPI-FB asseverated that the
claimed consideration of P2,000,000.00 for the introduction facilitated by Franco
between George Daantos and Eladio Teves, on the one hand, and Jaime Sebastian, on
the other, spoke volumes of Francos participation in the fraudulent transaction.
On August 4, 1993, the Manila RTC rendered judgment, the dispositive portion of
which reads as follows:
WHEREFORE, in view of all the foregoing, judgment is hereby rendered in favor of
[Franco] and against [BPI-FB], ordering the latter to pay to the former the following
sums:
1. P76,500.00 representing the legal rate of interest on the amount of P450,000.00
from May 18, 1990 to October 31, 1991;
2. P498,973.23 representing the balance on [Francos] savings account as of May 18,
1990, together with the interest thereon in accordance with the banks guidelines on
the payment therefor;
3. P30,000.00 by way of attorneys fees; and
4. P10,000.00 as nominal damages.
The counterclaim of the defendant is DISMISSED for lack of factual and legal anchor.
Costs against [BPI-FB]. SO ORDERED.28
Unsatisfied with the decision, both parties filed their respective appeals before the CA.
Franco confined his appeal to the Manila RTCs denial of his claim for moral and
exemplary damages, and the diminutive award of attorneys fees. In affirming with
modification the lower courts decision, the appellate court decreed, to wit:
WHEREFORE, foregoing considered, the appealed decision is hereby AFFIRMED
with modification ordering [BPI-FB] to pay [Franco] P63,189.00 representing the
interest deducted from the time deposit of plaintiff-appellant. P200,000.00 as moral
damages and P100,000.00 as exemplary damages, deleting the award of nominal
damages (in view of the award of moral and exemplary damages) and increasing the
award of attorneys fees from P30,000.00 to P75,000.00.
Cost against [BPI-FB]. SO ORDERED.29
In this recourse, BPI-FB ascribes error to the CA when it ruled that: (1) Franco had a
better right to the deposits in the subject accounts which are part of the proceeds of a
forged Authority to Debit; (2) Franco is entitled to interest on his current account; (3)
Franco can recover the P400,000.00 deposit in Quiaoits savings account; (4) the
dishonor of Francos checks was not legally in order; (5) BPI-FB is liable for interest
on Francos time deposit, and for moral and exemplary damages; and (6) BPI-FBs
counter-claim has no factual and legal anchor.
The petition is partly meritorious.
We are in full accord with the common ruling of the lower courts that BPI-FB cannot
unilaterally freeze Francos accounts and preclude him from withdrawing his deposits.
However, contrary to the appellate courts ruling, we hold that Franco is not entitled
to unearned interest on the time deposit as well as to moral and exemplary damages.
First. On the issue of who has a better right to the deposits in Francos accounts, BPI-
FB urges us that the legal consequence of FMICs forgery claim is that the money
transferred by BPI-FB to Tevesteco is its own, and considering that it was able to
recover possession of the same when the money was redeposited by Franco, it had the
right to set up its ownership thereon and freeze Francos accounts.
BPI-FB contends that its position is not unlike that of an owner of personal property
who regains possession after it is stolen, and to illustrate this point, BPI-FB gives the
following example: where Xs television set is stolen by Y who thereafter sells it to Z,
and where Z unwittingly entrusts possession of the TV set to X, the latter would have
the right to keep possession of the property and preclude Z from recovering possession
thereof. To bolster its position, BPI-FB cites Article 559 of the Civil Code, which
provides:
Article 559. The possession of movable property acquired in good faith is equivalent
to a title. Nevertheless, one who has lost any movable or has been unlawfully deprived
thereof, may recover it from the person in possession of the same.
If the possessor of a movable lost or of which the owner has been unlawfully deprived,
has acquired it in good faith at a public sale, the owner cannot obtain its return without
reimbursing the price paid therefor.
BPI-FBs argument is unsound. To begin with, the movable property mentioned in
Article 559 of the Civil Code pertains to a specific or determinate thing. 30 A
determinate or specific thing is one that is individualized and can be identified or
distinguished from others of the same kind.31
In this case, the deposit in Francos accounts consists of money which, albeit
characterized as a movable, is generic and fungible.32 The quality of being fungible
depends upon the possibility of the property, because of its nature or the will of the
parties, being substituted by others of the same kind, not having a distinct
individuality.33
Significantly, while Article 559 permits an owner who has lost or has been unlawfully
deprived of a movable to recover the exact same thing from the current possessor, BPI-
FB simply claims ownership of the equivalent amount of money, i.e., the value thereof,
which it had mistakenly debited from FMICs account and credited to Tevestecos,
and subsequently traced to Francos account. In fact, this is what BPI-FB did in filing
the Makati Case against Franco, et al. It staked its claim on the money itself which
passed from one account to another, commencing with the forged Authority to Debit.
It bears emphasizing that money bears no earmarks of peculiar ownership, 34 and this
characteristic is all the more manifest in the instant case which involves money in a
banking transaction gone awry. Its primary function is to pass from hand to hand as a
medium of exchange, without other evidence of its title. 35 Money, which had passed
through various transactions in the general course of banking business, even if of
traceable origin, is no exception.
Thus, inasmuch as what is involved is not a specific or determinate personal property,
BPI-FBs illustrative example, ostensibly based on Article 559, is inapplicable to the
instant case.
There is no doubt that BPI-FB owns the deposited monies in the accounts of Franco,
but not as a legal consequence of its unauthorized transfer of FMICs deposits to
Tevestecos account. BPI-FB conveniently forgets that the deposit of money in banks
is governed by the Civil Code provisions on simple loan or mutuum. 36 As there is a
debtor-creditor relationship between a bank and its depositor, BPI-FB ultimately
acquired ownership of Francos deposits, but such ownership is coupled with a
corresponding obligation to pay him an equal amount on demand.37 Although BPI-FB
owns the deposits in Francos accounts, it cannot prevent him from demanding
payment of BPI-FBs obligation by drawing checks against his current account, or
asking for the release of the funds in his savings account. Thus, when Franco issued
checks drawn against his current account, he had every right as creditor to expect that
those checks would be honored by BPI-FB as debtor.
More importantly, BPI-FB does not have a unilateral right to freeze the accounts of
Franco based on its mere suspicion that the funds therein were proceeds of the multi-
million peso scam Franco was allegedly involved in. To grant BPI-FB, or any bank
for that matter, the right to take whatever action it pleases on deposits which it
supposes are derived from shady transactions, would open the floodgates of public
distrust in the banking industry.
Our pronouncement in Simex International (Manila), Inc. v. Court of
Appeals38 continues to resonate, thus:
The banking system is an indispensable institution in the modern world and plays a
vital role in the economic life of every civilized nation. Whether as mere passive
entities for the safekeeping and saving of money or as active instruments of business
and commerce, banks have become an ubiquitous presence among the people, who
have come to regard them with respect and even gratitude and, most of all, confidence.
Thus, even the humble wage-earner has not hesitated to entrust his lifes savings to the
bank of his choice, knowing that they will be safe in its custody and will even earn
some interest for him. The ordinary person, with equal faith, usually maintains a
modest checking account for security and convenience in the settling of his monthly
bills and the payment of ordinary expenses. x x x.
In every case, the depositor expects the bank to treat his account with the utmost
fidelity, whether such account consists only of a few hundred pesos or of millions. The
bank must record every single transaction accurately, down to the last centavo, and as
promptly as possible. This has to be done if the account is to reflect at any given time
the amount of money the depositor can dispose of as he sees fit, confident that the bank
will deliver it as and to whomever directs. A blunder on the part of the bank, such as
the dishonor of the check without good reason, can cause the depositor not a little
embarrassment if not also financial loss and perhaps even civil and criminal litigation.
The point is that as a business affected with public interest and because of the nature
of its functions, the bank is under obligation to treat the accounts of its depositors with
meticulous care, always having in mind the fiduciary nature of their relationship. x x
x.
Ineluctably, BPI-FB, as the trustee in the fiduciary relationship, is duty bound to know
the signatures of its customers. Having failed to detect the forgery in the Authority to
Debit and in the process inadvertently facilitate the FMIC-Tevesteco transfer, BPI-FB
cannot now shift liability thereon to Franco and the other payees of checks issued by
Tevesteco, or prevent withdrawals from their respective accounts without the
appropriate court writ or a favorable final judgment.
Further, it boggles the mind why BPI-FB, even without delving into the authenticity
of the signature in the Authority to Debit, effected the transfer of P80,000,000.00 from
FMICs to Tevestecos account, when FMICs account was a time deposit and it had
already paid advance interest to FMIC. Considering that there is as yet no indubitable
evidence establishing Francos participation in the forgery, he remains an innocent
party. As between him and BPI-FB, the latter, which made possible the present
predicament, must bear the resulting loss or inconvenience.
Second. With respect to its liability for interest on Francos current account, BPI-FB
argues that its non-compliance with the Makati RTCs Order Lifting the Order of
Attachment and the legal consequences thereof, is a matter that ought to be taken up
in that court.
The argument is tenuous. We agree with the succinct holding of the appellate court in
this respect. The Manila RTCs order to pay interests on Francos current account
arose from BPI-FBs unjustified refusal to comply with its obligation to pay Franco
pursuant to their contract of mutuum. In other words, from the time BPI-FB refused
Francos demand for the release of the deposits in his current account, specifically,
from May 17, 1990, interest at the rate of 12% began to accrue thereon. 39
Undeniably, the Makati RTC is vested with the authority to determine the legal
consequences of BPI-FBs non-compliance with the Order Lifting the Order of
Attachment. However, such authority does not preclude the Manila RTC from ruling
on BPI-FBs liability to Franco for payment of interest based on its continued and
unjustified refusal to perform a contractual obligation upon demand. After all, this was
the core issue raised by Franco in his complaint before the Manila RTC.
Third. As to the award to Franco of the deposits in Quiaoits account, we find no reason
to depart from the factual findings of both the Manila RTC and the CA.
Noteworthy is the fact that Quiaoit himself testified that the deposits in his account are
actually owned by Franco who simply accommodated Jaime Sebastians request to
temporarily transfer P400,000.00 from Francos savings account to Quiaoits
account.40 His testimony cannot be characterized as hearsay as the records reveal that
he had personal knowledge of the arrangement made between Franco, Sebastian and
himself.41
BPI-FB makes capital of Francos belated allegation relative to this particular
arrangement. It insists that the transaction with Quiaoit was not specifically alleged in
Francos complaint before the Manila RTC. However, it appears that BPI-FB had
impliedly consented to the trial of this issue given its extensive cross-examination of
Quiaoit.
Section 5, Rule 10 of the Rules of Court provides:
Section 5. Amendment to conform to or authorize presentation of evidence. When
issues not raised by the pleadings are tried with the express or implied consent of the
parties, they shall be treated in all respects as if they had been raised in the pleadings.
Such amendment of the pleadings as may be necessary to cause them to conform to
the evidence and to raise these issues may be made upon motion of any party at any
time, even after judgment; but failure to amend does not affect the result of the trial of
these issues. If evidence is objected to at the trial on the ground that it is now within
the issues made by the pleadings, the court may allow the pleadings to be amended
and shall do so with liberality if the presentation of the merits of the action and the
ends of substantial justice will be subserved thereby. The court may grant a
continuance to enable the amendment to be made. (Emphasis supplied)
In all, BPI-FBs argument that this case is not the right forum for Franco to recover
the P400,000.00 begs the issue. To reiterate, Quiaoit, testifying during the trial,
unequivocally disclaimed ownership of the funds in his account, and pointed to Franco
as the actual owner thereof. Clearly, Francos action for the recovery of his deposits
appropriately covers the deposits in Quiaoits account.
Fourth. Notwithstanding all the foregoing, BPI-FB continues to insist that the dishonor
of Francos checks respectively dated September 11 and 18, 1989 was legally in order
in view of the Makati RTCs supplemental writ of attachment issued on September 14,
1989. It posits that as the party that applied for the writ of attachment before the Makati
RTC, it need not be served with the Notice of Garnishment before it could place
Francos accounts under garnishment.
The argument is specious. In this argument, we perceive BPI-FBs clever but
transparent ploy to circumvent Section 4,42 Rule 13 of the Rules of Court. It should be
noted that the strict requirement on service of court papers upon the parties affected is
designed to comply with the elementary requisites of due process. Franco was entitled,
as a matter of right, to notice, if the requirements of due process are to be observed.
Yet, he received a copy of the Notice of Garnishment only on September 27, 1989,
several days after the two checks he issued were dishonored by BPI-FB on September
20 and 21, 1989. Verily, it was premature for BPI-FB to freeze Francos accounts
without even awaiting service of the Makati RTCs Notice of Garnishment on Franco.
Additionally, it should be remembered that the enforcement of a writ of attachment
cannot be made without including in the main suit the owner of the property attached
by virtue thereof. Section 5, Rule 13 of the Rules of Court specifically provides that
"no levy or attachment pursuant to the writ issued x x x shall be enforced unless it is
preceded, or contemporaneously accompanied, by service of summons, together with
a copy of the complaint, the application for attachment, on the defendant within the
Philippines."
Franco was impleaded as party-defendant only on May 15, 1990. The Makati RTC
had yet to acquire jurisdiction over the person of Franco when BPI-FB garnished his
accounts.43 Effectively, therefore, the Makati RTC had no authority yet to bind the
deposits of Franco through the writ of attachment, and consequently, there was no
legal basis for BPI-FB to dishonor the checks issued by Franco.
Fifth. Anent the CAs finding that BPI-FB was in bad faith and as such liable for the
advance interest it deducted from Francos time deposit account, and for moral as well
as exemplary damages, we find it proper to reinstate the ruling of the trial court, and
allow only the recovery of nominal damages in the amount of P10,000.00. However,
we retain the CAs award of P75,000.00 as attorneys fees.
In granting Francos prayer for interest on his time deposit account and for moral and
exemplary damages, the CA attributed bad faith to BPI-FB because it (1) completely
disregarded its obligation to Franco; (2) misleadingly claimed that Francos deposits
were under garnishment; (3) misrepresented that Francos current account was not on
file; and (4) refused to return the P400,000.00 despite the fact that the ostensible
owner, Quiaoit, wanted the amount returned to Franco.
In this regard, we are guided by Article 2201 of the Civil Code which provides:
Article 2201. In contracts and quasi-contracts, the damages for which the obligor who
acted in good faith is liable shall be those that are the natural and probable
consequences of the breach of the obligation, and which the parties have foreseen or
could have reasonable foreseen at the time the obligation was constituted.
In case of fraud, bad faith, malice or wanton attitude, the obligor shall be responsible
for all damages which may be reasonably attributed to the non-performance of the
obligation. (Emphasis supplied.)
We find, as the trial court did, that BPI-FB acted out of the impetus of self-protection
and not out of malevolence or ill will. BPI-FB was not in the corrupt state of mind
contemplated in Article 2201 and should not be held liable for all damages now being
imputed to it for its breach of obligation. For the same reason, it is not liable for the
unearned interest on the time deposit.
Bad faith does not simply connote bad judgment or negligence; it imports a dishonest
purpose or some moral obliquity and conscious doing of wrong; it partakes of the
nature of fraud.44 We have held that it is a breach of a known duty through some motive
of interest or ill will.45 In the instant case, we cannot attribute to BPI-FB fraud or even
a motive of self-enrichment. As the trial court found, there was no denial whatsoever
by BPI-FB of the existence of the accounts. The computer-generated document which
indicated that the current account was "not on file" resulted from the prior debit by
BPI-FB of the deposits. The remedy of freezing the account, or the garnishment, or
even the outright refusal to honor any transaction thereon was resorted to solely for
the purpose of holding on to the funds as a security for its intended court action, 46 and
with no other goal but to ensure the integrity of the accounts.
We have had occasion to hold that in the absence of fraud or bad faith, 47 moral
damages cannot be awarded; and that the adverse result of an action does not per se
make the action wrongful, or the party liable for it. One may err, but error alone is not
a ground for granting such damages.48
An award of moral damages contemplates the existence of the following requisites:
(1) there must be an injury clearly sustained by the claimant, whether physical, mental
or psychological; (2) there must be a culpable act or omission factually established;
(3) the wrongful act or omission of the defendant is the proximate cause of the injury
sustained by the claimant; and (4) the award for damages is predicated on any of the
cases stated in Article 2219 of the Civil Code.49
Franco could not point to, or identify any particular circumstance in Article 2219 of
the Civil Code,50 upon which to base his claim for moral damages.1wphi1
Thus, not having acted in bad faith, BPI-FB cannot be held liable for moral damages
under Article 2220 of the Civil Code for breach of contract.51
We also deny the claim for exemplary damages. Franco should show that he is entitled
to moral, temperate, or compensatory damages before the court may even consider the
question of whether exemplary damages should be awarded to him. 52 As there is no
basis for the award of moral damages, neither can exemplary damages be granted.
While it is a sound policy not to set a premium on the right to litigate, 53 we, however,
find that Franco is entitled to reasonable attorneys fees for having been compelled to
go to court in order to assert his right. Thus, we affirm the CAs grant of P75,000.00
as attorneys fees.
Attorneys fees may be awarded when a party is compelled to litigate or incur expenses
to protect his interest,54or when the court deems it just and equitable.55 In the case at
bench, BPI-FB refused to unfreeze the deposits of Franco despite the Makati RTCs
Order Lifting the Order of Attachment and Quiaoits unwavering assertion that
the P400,000.00 was part of Francos savings account. This refusal constrained Franco
to incur expenses and litigate for almost two (2) decades in order to protect his interests
and recover his deposits. Therefore, this Court deems it just and equitable to grant
Franco P75,000.00 as attorneys fees. The award is reasonable in view of the
complexity of the issues and the time it has taken for this case to be resolved. 56
Sixth. As for the dismissal of BPI-FBs counter-claim, we uphold the Manila RTCs
ruling, as affirmed by the CA, that BPI-FB is not entitled to recover P3,800,000.00 as
actual damages. BPI-FBs alleged loss of profit as a result of Francos suit is, as
already pointed out, of its own making. Accordingly, the denial of its counter-claim is
in order.
WHEREFORE, the petition is PARTIALLY GRANTED. The Court of Appeals
Decision dated November 29, 1995 is AFFIRMED with the MODIFICATION that the
award of unearned interest on the time deposit and of moral and exemplary damages
is DELETED.
Gatchalian v delim 21 oct 1991
FACTS:
July 11,1973: Reynalda Gatchalian boarded Thames" mini bus at Aringay,
La Union bound for Bauang, of the same province. The bus bumped a
cement flower pot on the side of the road, went off the road, turned turtle and
fell into a ditch.
Gatchalian got injured with physical injuries on the leg, arm and forehead
Mrs. Adela Delim visited the passenger and later paid for their hospitalization
and medical expenses. She also gave transportation expense of P12 in going
home from the hospital and they were made to sign a Joint Affidavit stating
that they are no longer interested to file a complaint, criminal or civil against
the said driver and owner of the said Thames.
Gatchalian filed in the CFI an action extra contractu to recover compensatory
and moral damages stating that the mishap had left her with a conspicuous
white scar measuring 1 by 1/2 inches on the forehead, generating mental
suffering and an inferiority complex on her part
as a result, she had to retire in seclusion and stay away from her friends
scar diminished her facial beauty and deprived her of opportunities for employment
Delim averred that it was a fortuitous event
CFI: dismissed because of the Joint Affidavit
 CA: affirmed
ISSUE: W/N Gatchalian is entitled to damages
HELD: YES. CA, CFI REVERSED and SET ASIDE 1) P15,000 actual or
compensatory damages to cover the cost of plastic surgery for the removal of the scar
on petitioner's forehead; 2) P30,000 moral damages; and 3) P1,000 attorney's fees, the
aggregate amount to bear interest at the legal rate of 6% per annum counting from the
promulgation of this decision until full payment thereof
A waiver, to be valid and effective, must in the first place be couched in clear and
unequivocal terms which leave no doubt as to the intention of a person to give up a
right or benefit which legally pertains to him.
while reading the same, she experienced dizziness but that, seeing the other passengers
who had also suffered injuries sign the document, she too signed without bothering to
read the Joint Affidavit in its entirety. Considering these circumstances there appears
substantial doubt whether petitioner understood fully the import of the Joint Affidavit
To uphold a supposed waiver of any right to claim damages by an injured passenger,
under circumstances like those exhibited in this case, would be to dilute and weaken
the standard of extraordinary diligence exacted by the law from common carriers and
hence to render that standard unenforceable.
To exempt a common carrier from liability for death or physical injuries to passengers
upon the ground of force majeure, the carrier must clearly show not only that the
efficient cause of the casualty was entirely independent of the human will, but also
that it was impossible to avoid.The driver did not stop to check if anything had gone
wrong with the bus after the snapping sound Court of Appeals, however, found that at
the time of the accident, she was no longer employed in a public school since, being a
casual employee and not a Civil Service eligible, she had been laid off. Her
employment as a substitute teacher was occasional and episodic, contingent upon the
availability of vacancies for substitute teachers. A person is entitled to the physical
integrity of his or her body; if that integrity is violated or diminished, actual injury is
suffered for which actual or compensatory damages are due and assessable. Petitioner
Gatchalian is entitled to be placed as nearly as possible in the condition that she was
before the mishap. A scar, especially one on the face of the woman, resulting from the
infliction of injury upon her, is a violation of bodily integrity, giving raise to a
legitimate claim for restoration to her conditio ante. If the scar is relatively small and
does not grievously disfigure the victim, the cost of surgery may be expected to be
correspondingly modest.
In view of the testimony, and the fact that a considerable amount of time has lapsed
since the mishap in 1973 which may be expected to increase not only the cost but also
very probably the difficulty of removing the scar, we consider that the amount of
P15,000.00 to cover the cost of such plastic surgery is not unreasonable. Moral
damages may be awarded where gross negligence on the part of the common carrier
Simex international v ca 19 march 1990
Facts: Simex International is a private corporation engaged in the exportation of food
products. It buys these products from various local suppliers and then sells them
abroad to the Middle East and the United States. Most of its exports are purchased by
the petitioner on credit. Simex was a depositor of the Far East Savings Bank and
maintained a checking account in its branch in Cubao, Quezon City which issued
several checks against its deposit but was surprised to learn later that they had been
dishonored for insufficient funds. As a consequence, several suppliers sent a letter of
demand to the petitioner, threatening prosecution if the dishonored check issued to it
was not made good and also withheld delivery of the order made by the petitioner.
One supplier also cancelled the petitioners credit line and demanded that future
payments be made by it in cash or certified check. The petitioner complained to the
respondent bank. Investigation disclosed that the sum of P100,000.00 deposited by the
petitioner on May 25, 1981, had not been credited to it. The error was rectified only a
month after, and the dishonored checks were paid after they were re-deposited. The
petitioner then filed a complaint in the then Court of First Instance of Rizal against the
bank for its gross and wanton negligence.
Issue: Whether or not the bank can be held liable for negligence by reason of its
unjustified dishonor of a check
Held: The depositor expects the bank to treat his account with the utmost fidelity
whether such account consists only of a few hundred pesos or of millions. The bank
must record every single transaction accurately, down to the last centavo, and as
promptly as possible. This has to be done if the account is to reflect at any given time
the amount of money the depositor can dispose of as he sees fit, confident that the bank
will deliver it as and to whomever he directs. A blunder on the part of the bank, such
as the dishonour of a check without good reason, can cause the depositor not a little
embarrassment if not also financial loss and perhaps even civil and criminal litigation.
Article 2205 of the Civil Code provides that actual or compensatory damages may be
received (2) for injury to the plaintiff s business standing or commercial credit.
There is no question that the petitioner did sustain actual injury as a result of the
dishonored checks and that the existence of the loss having been established absolute
certainty as to its amount is not required. 7 Such injury should bolster all the more the
demand of the petitioner for moral damages and justifies the examination by this Court
of the validity and reasonableness of the said claim.
PHILIPPINE HAWK CORPORATION vs. VIVIAN TAN LEE
FACTS: The bus owned by the Philippine Hawk Company collided with the
motorcycle of spouses Vivian Tan Lee and SIlverio Tan. The accident causes the death
of respondents husband and claims for actual damages.
Respondents husband was leasing and operating a gasoline station and earned an
annual income of one million pesos and they also had a copra business which gave
them an income of P3,000 a month. In order to prove for loss of earning capacity for
the operation of gasoline station, respondent presented in evidence a Certificate of
Creditable Income Tax Withheld at Source. On the other hand, she presented her
testimony as evidence for his husbands earnings for copra business.
ISSUE: Is the evidence presented sufficient to compute the actual damages as
indemnity?
HELD: No. The indemnity for loss of earning capacity of the deceased is provided for
by Article 2206 of the Civil Code. As a rule, documentary evidence should be
presented to substantiate the claim for damages for loss of earning capacity. It is
reasonable to use the Certificate and respondents testimony as bases for fixing the
gross annual income of the deceased at one million pesos before respondents husband
died on March 17, 1999. However, no documentary evidence was presented regarding
the income derived from their copra business; hence, the testimony of respondent as
regards such income cannot be considered. In the absence of documentary evidence,
it is reasonable to peg necessary expenses for the lease and operation of the gasoline
station at 80 percent of the gross income, and peg living expenses at 50 percent of the
net income (gross income less necessary expenses).
Pleyto v lomboy 16 june 2004
ERNESTO PLEYTO vs. MARIA D. LOMBOY FACTS: At approximately 11:30 a.m.
of May 16, 1995, PRBL driven by petitioner Pleyto, was traveling along MacArthur
Highway in Gerona, Tarlac bound for Vigan, Ilocos Sur. It was drizzling that morning
and the macadam road was wet. Right in front of the bus, headed north, was the tricycle
owned and driven by one Rodolfo Esguerra. According to Rolly Orpilla, a witness and
one of the bus passengers, Pleyto tried to overtake Esguerras tricycle but hit it instead.
Pleyto then swerved into the left opposite lane. Coming down the lane, some fifty
meters away, was a southbound Mitsubishi Lancer car driven by Arnulfo Asuncion.
The car was headed for Manila with some passengers. Seated beside Arnulfo was his
brother-in-law, Ricardo Lomboy, while in the back seat were Ricardos 18-year old
daughter Carmela and her friend, one Rhino Daba. PRBL smashed head-on the car,
killing Arnulfo and Ricardo instantly. Carmela and Rhino suffered injuries, but only
Carmela required hospitalization. In their Answer, petitioners PRBL and Ernesto
Pleyto both claimed that the bus was running slowly at the time of the accident. They
pointed out the Bus had been inspected by driver Pleyto and examined by a mechanic
prior to the trip, in accordance with the companys standard operating procedure. It
was found in good working condition. Pleyto claimed that while cruising along the
highway at Gerona, Tarlac, he noticed Esguerras tricycle and followed it at a safe
distance after he was unable to overtake it. Suddenly and without warning, the tricycle
stopped in the middle of the road. Pleyto stepped on the brakes and the bus lost speed.
But, since it skidded towards the direction of the tricycle, he swerved the bus to the
other lane to avoid hitting it, only to collide with the Manila-bound Mitsubishi car.
The Trial Court in its decision judgment in favor of the plaintiffs and against the
defendants ordering the defendants to pay solidarily the plaintiffs the following
amounts: 1) P50,000.00 as indemnification for the death of Ricardo Lomboy; 2)
P1,642,521.00 for lost earnings of Ricardo Lomboy; 3) P59,550.00 as actual damages
for the funeral, wake, religious services and prayer for the soul of the departed; 4)
P52,000.00 for the medical treatment and medicine of Carmela Lomboy; 5)
P500,000.00 as moral damages for the wife and children excluding Carmela Lomboy;
6) P50,000.00 as moral damages for Carmela Lomboy; and 7) To pay costs. The RTC
found Pleyto negligent and lacking in precaution when he overtook the tricycle with
complete disregard of the approaching car in the other lane. It found the testimony of
Rolly Orpilla credible and persuasive as against Pleytos self-serving and unbelievable
testimony. The court found that Pleyto should have been more prudent in overtaking
a tricycle, considering that it was drizzling, the road was slippery, and another vehicle
was approaching from the opposite direction. The RTC found that Pleyto had clearly
violated traffic rules and regulations, and thus was negligent under Article 2185 of the
Civil Code of the Philippines because petitioner Pleyto failed to present any proof to
rebut the presumption. The lower court likewise held co-petitioner PRBL equally
liable under Article 2180 of the Civil Code for its failure to show that it had maintained
proper supervision of its employees notwithstanding strict standards in employee
selection. On appeal, the Court of Appeals, affirmed the decision of the trial court,
with modification in the award of damages, to wit: for actual damages, it is reduced to
P39,550.00, for funeral and religious services and P27,000.00 for medical expenses of
Carmela Lomboy; and the award for loss of earning capacity is accordingly corrected
to P1,152,000.00. ISSUES: 1. Whether the Supreme Court may review the conclusion
drawn by the Court of Appeals, namely, that the PRBL bus overtook a tricycle thus
causing the accident, since it was made in disregard of facts undisputed by the parties.
2. Whether the court of appeals disregarded the doctrine laid down in villa Rey Transit,
Inc. V. Court Of Appeals, G.R. No. L-25499, February 18, 1970, 31 SCRA 511, when
it arbitrarily pegged the monthly living expenses at 50% of gross earnings. HELD: 1.
No. At the outset, it appears that petitioners call for this Court to review the factual
findings and conclusions of the Court of Appeals. Petitioners assail the appellate
courts affirmance of the finding by the trial court that Pleyto was negligent. The issue
of negligence is factual and, in quasi-delicts, crucial in the award of damages. But it is
well established that under Rule 45 of the 1997 Rules of Civil Procedure, only
questions of law, not of fact, may be raised before the Supreme Court. It must be
stressed that this Court is not a trier of facts, and it is not its function to re-examine
and weigh anew the respective evidence of the parties. Factual findings of the trial
court, especially those affirmed by the Court of Appeals, are conclusive on this Court
when supported by the evidence on record. In the present petition, no compelling
reason is shown by petitioners whatsoever for this Court to reverse those findings. 2.
No. The petitioners misread Villa Rey Transit case. Thus, it has been consistently
held that earning capacity, as an element of damages to ones estate for his death by
wrongful act is necessarily his net earning capacity or his capacity to acquire money,
less the necessary expense for his own living. Stated otherwise, the amount
recoverable is not loss of the entire earning, but rather the loss of that portion of the
earnings which the beneficiary would have received. In other words, only net earnings,
not gross earning, are to be considered that is, the total of the earnings less expenses
necessary in the creation of such earnings or income and less living and other
incidental expenses. In considering the earning capacity of the victim as an element
of damages, the net earnings, which is computed by deducting necessary expenses
from the gross earnings, and not the gross earnings, is to be utilized in the computation.
Note that in the present case, both the Court of Appeals and the trial court used net
earnings, not gross earnings in computing loss of earning capacity. The amount of net
earnings was arrived at after deducting the necessary expenses (pegged at 50% of gross
income) from the gross annual income. This computation is in accord with settled
jurisprudence, including the Villa Rey case. Thus, no reversible error may be attributed
to the court a quo in fixing the loss of earning capacity at said amount.
Crisostomo v people 1 sept . 2010
Factual Antecedents
The Information filed against petitioner and his two companions designated only as
John Doe and Peter Doe contained the following accusatory allegations:
That on or about the 12th day of February, 2001, in the municipality of San Miguel,
province of Bulacan, Philippines and within the jurisdiction of this Honorable Court,
the above-named accused, conspiring and helping one another, armed with a gun, did
then and there willfully, unlawfully and feloniously, with intent [to] gain and by means
of force, violence and intimidation upon person, enter the gasoline station owned by
Jose Buencamino and once inside, take, rob and carry away with them P40,000.00,
belonging to the said Jose Buencamino, to the damage and prejudice of the latter in
the amount of P40,000.00, and on the occasion of the commission of the said robbery
or by reason thereof, the herein accused, in furtherance of their conspiracy, did then
and there willfully, unlawfully and feloniously, attack, assault and shoot Janet Ramos,
cashier of said gasoline station, thereby inflicting on her serious physical injuries
which directly caused her death. Contrary to law.3 During his arraignment, petitioner
entered a plea of not guilty.4 Thereafter, trial ensued.
Version of the Prosecution
On February 12, 2001, at around 12:20 in the afternoon, Rodelio Pangilinan (Rodelio)
was working at a gasoline station owned by Jose Buencamino (Jose) at Buliran, San
Miguel, Bulacan. He was by the gasoline tank which was two or three arms length
from the cashiers office when three armed men on board a motorcycle arrived. Two
of the men immediately went to the cashier while the driver stayed on the motorcycle.
Inside the office, one of the men pulled out a fan knife while the other, armed with a
gun, fired a shot at Janet Ramos (Janet), the cashier. They forcibly took the money in
the cash register and the man with the gun fired a second shot that fatally hit Janet in
the right side of her head. The two armed men returned to their companion waiting by
the motorcycle and together sped away from the scene of the crime.
Rodelio gave a description of the driver of the motorcycle but not of the two armed
men who entered the cashiers office since they had their backs turned to him. The
National Bureau of Investigation (NBI) prepared a cartographic sketch based on the
information provided by Rodelio. Jose, the owner of the gas station, stated that the
stolen money was worth P40,000.00. Receipts in the amount of P14,500.00 were
presented as funeral expenses.
On February 23, 2001, the petitioner was detained after being implicated in a robbery
that occurred in San Miguel, Bulacan. During his detention, Rodelio and another
gasoline boy arrived and identified him in a police lineup as one of the three robbers
who killed Janet.
Version of the Defense: Petitioner denied committing the crime for which he was
charged. He maintained that the face of the man depicted in the cartographic sketch by
the NBI was completely different from his appearance in the police lineup in which
Rodelio pointed at him as one of the perpetrators. He argued that the only reason why
Rodelio pointed to him in the police lineup was because he was the only one in
handcuffs.
Ruling of the Regional Trial Court: The trial court rendered its Decision convicting
petitioner of robbery with homicide. The dispositive portion reads:
WHEREFORE, finding herein accused RODEL CRISOSTOMO y DE LEON guilty
as principal beyond reasonable doubt of the crime of robbery with homicide as
charged, there being no circumstances, aggravating or mitigating, found attendant in
the commission thereof, he is hereby sentenced to suffer the penalty of reclusion
perpetua, to indemnify the heirs of victim Janet Ramos in the amount of P75,000.00,
the owner or operator, Jose Buencamino, Jr., of the gasoline station that was robbed,
in the amount of P40,000.00 plus P14,500.00 as funeral expenses (Exh. "H") defrayed
by said owner for its cashier Janet Ramos, as actual damages, and to pay the costs of
the proceedings.
In the service of his sentence said accused, a detention prisoner, shall be credited with
the full time during which he had undergone preventive imprisonment, pursuant to
Art. 29 of the Revised Penal Code.
SO ORDERED.5
Not satisfied, petitioner filed a Motion for Reconsideration and Inhibition,6 which was
denied by the trial court in an Order7 dated January 13, 2003.
Ruling of the Court of Appeals
Upon review of the case pursuant to this Courts ruling in People v. Mateo, 8 the CA
affirmed with modification the conviction of petitioner. The dispositive portion of the
CAs Decision reads: In VIEW OF ALL THE FOREGOING, the appealed decision is
AFFIRMED, with a modification that the awarded civil indemnity is reduced
from P75,000.00 to P50,000,00. Costs de oficio. SO ORDERED.9
Issue
Before us, the petitioner assails the Decision of the CA and raises the following issue:
WHETHER X X X THE X X X COURT OF APPEALS COMMITTED ERROR IN
NOT HOLDING THAT THE TRIAL COURT GRIEVOUSLY ERRED IN THE
APRPECIATION OF FACTS AND APPLYING THE LAW IN CONVICTING
ACCUSED OF ROBBERY WITH HOMICIDE.10
Our Ruling The petition is unmeritorious.
The trial court properly denied the motion for inhibition.
Petitioner claims that his motion for inhibition should have been granted since his
counsel filed a case against the wife of the trial judge involving a land dispute.
Petitioner alleges that the case rendered the trial judge partial, biased and, thus,
incapable of rendering a just and wise decision.
We are not convinced. It must be stressed that as a rule, "a motion to inhibit must be
denied if filed after x x x the Court had already given its opinion on the merits of the
case, the rationale being that a litigant cannot be permitted to speculate upon the
action of the court x x x (only to) raise an objection of this sort after a decision had
been rendered."11 Here, petitioners Motion for Reconsideration and Inhibition was
filed on November 29, 200212 after the trial court rendered its Decision on November
14, 2002.13 Accordingly, the trial judge did not commit any impropriety in denying the
motion to inhibit as it came after the case had been decided on the merits.
Further, in a motion for inhibition, "[t]he movant must x x x prove the ground of bias
and prejudice by clear and convincing evidence to disqualify a judge from
participating in a particular trial."14 "Bare allegations of partiality x x x [is not
sufficient] in the absence of clear and convincing evidence to overcome the
presumption that the judge will undertake his noble role to dispense justice according
to law and evidence and without fear or favor." 15Petitioners bare allegations in his
motion to inhibit are not adequate grounds for the disqualification or inhibition of the
trial judge. Thus, credence should not be given to the issue of alleged prejudice and
partiality of the trial judge.
Petitioner is guilty of the complex crime of robbery with homicide.
Robbery with homicide exists "when a homicide is committed either by reason, or on
occasion, of the robbery. To sustain a conviction for robbery with homicide, the
prosecution must prove the following elements: (1) the taking of personal property
belonging to another; (2) with intent to gain; (3) with the use of violence or
intimidation against a person; and[,] (4) on the occasion or by reason of the robbery,
the crime of homicide, as used in its generic sense, was committed. A conviction
requires certitude that the robbery is the main purpose and objective of the malefactor
and the killing is merely incidental to the robbery. The intent to rob must precede the
taking of human life but the killing may occur before, during or after the robbery." 16
In this case, the prosecution successfully adduced proof beyond reasonable doubt that
the genuine intention of the petitioner and his companions was to rob the gasoline
station. Rodelio testified that at around 12:20 in the afternoon of February 12, 2001,
the petitioner and his companions arrived on board a motorcycle at the gas station
located at Buliran, San Miguel, Bulacan. While the petitioner stayed on the
motorcycle, his companions entered the cashiers office. One of them pulled out a fan
knife while the other fired his gun at Janet. After divesting the amount of P40,000.00,
the man with the gun fired a fatal shot to the head of Janet. The petitioners companions
returned to and boarded their motorcycle, and sped away together. 17
From the foregoing, it is clear that the overriding intention of the petitioner and his
cohorts was to rob the gasoline station. The killing was merely incidental, resulting by
reason or on occasion of the robbery.
The petitioner attempts to discredit Rodelio, the eyewitness presented by the
prosecution, by asserting that his testimony is in conflict with the statements in his
affidavit. In his testimony, Rodelio said that it was one of the men who entered the
cashiers office who was holding a gun while in his sworn statement, he alleged that
petitioner had a .45 caliber pistol which was poked at him.
Such an argument fails to impress as discrepancies between sworn statements and
testimonies made at the witness stand do not necessarily discredit the witness. "Sworn
statements/affidavits are generally subordinated in importance to open court
declarations because the former are often executed when the affiants mental faculties
are not in such a state as to afford him a fair opportunity of narrating in full the incident
which transpired. Testimonies given during trials are much more exact and elaborate.
Thus, testimonial evidence carries more weight than sworn statements/affidavits." 18
"Further, to the extent that inconsistencies were in fact shown, they appear to [this]
Court to relate to details of peripheral significance which do not negate or dissolve the
positive identification [by the eyewitness of the petitioner and his co-accused] as the
perpetrators of the crime."19
That Rodelio had to be subpoenaed five times and be arrested in order to testify for the
prosecution do not weaken the case against the petitioner and his cohorts. During
cross-examination, Rodelio explained that his failure to respond immediately to the
subpoena was because he does not know how to go to court. Thus:
Q: Why did you fail to appear before this Honorable Court when you were first
summoned to appear before this court?
A: Because my employer was sick, sir.
COURT:
Q: Who was that employer?
A: Ping Buencamino, your Honor.
ATTY. KLIATCHKO:
Q: Assuming that he is sick why did you not go to this Honorable Court?
A: I have no companion. I have no idea.
Q: You have no idea about what?
A: I do not know how to come to this court, sir.20
Even assuming that Rodelio was initially reluctant to testify and get involved in the
ensuing criminal prosecution against the petitioner and his co-accused, this "is but
normal and does not by itself affect [his] credibility." 21
The petitioner also avers that he was not the person depicted in the cartographic sketch.
However, "a cartographic sketch, unlike a photograph, is only intended to give the law
enforcers a general idea of the likeness of a suspect and is never expected to exactly
resemble his actual facial appearance. Even the description of the suspect given in the
cartographic sketch may not be unerringly exact." 22 What is important is the fact that
the petitioner was positively identified by Rodelio as the perpetrator of the crime even
without a moustache and curly hair.
We are not likewise impressed with petitioners assertion that the case against him was
weakened with the failure to present Reinerio, the other eyewitness to the commission
of the crime and one of the prosecutions proposed witnesses. As a rule, "the
prosecution has the exclusive prerogative to determine whom to present as witnesses.
[It] need not present each and every witness but only such as may be needed to meet
the quantum of proof necessary to establish the guilt of the accused beyond reasonable
doubt."23 Here, the testimony of Reinerio would merely corroborate the statements of
Rodelio on the witness stand, which when considered together with the other evidence
presented by the prosecution, established beyond reasonable doubt the culpability of
the petitioner and his cohorts. Further, there is nothing on record which would show
that Rodelio was actuated by ill motive or hate in imputing a serious offense of robbery
with homicide against the petitioner.
We are also not impressed with the petitioners insistence that his identification in the
police lineup was highly irregular. There is simply no factual basis to prove that he
was the only suspect in the lineup with handcuffs that prompted Rodelio to point to
him as the suspect. It is worth stressing that the police investigators are presumed to
have performed their duties regularly and in good faith. 24 In the absence of sufficient
proof to overturn this presumption, petitioners positive identification by Rodelio
remains free from any stain of wrongdoing.1avvphi1
Besides, not only did Rodelio identify the petitioner in the police lineup, he also
positively identified petitioner when he testified in court.
The petitioners contention that he did not conspire with the other accused in the
commission of the crime cannot be given credence. There is no doubt that the
petitioner participated actively in the commission of the crime. He was positively
identified as the driver of the motorcycle with his two male companions on board.
They arrived together at the gasoline station. His cohorts then went inside the office
to conduct the robbery while he remained on the motorcycle and waited for his cohorts.
After his two companions stole the money and killed the cashier, they sped away from
the scene of the crime in each others company using the same motorcycle. Against
the testimony of the prosecutions eyewitness, the petitioner could only rely on the
defense of denial. This defense, however, deserves scant consideration since "denial
cannot prevail over the positive testimony of a witness. A mere denial, just like alibi,
is a self-serving negative evidence which cannot be accorded greater evidentiary
weight than the declaration of credible witnesses who [testified] on affirmative
matters."25"The concerted manner [in which the petitioner and his] companions
perpetrated the crime showed beyond reasonable doubt the presence of conspiracy.
Where conspiracy is established, it matters not who among the accused actually shot
and killed the victim. The consistent doctrinal rule is that when a homicide takes place
by reason or on the occasion of the robbery, all those who took part shall be guilty of
the special complex crime of robbery with homicide whether or not they actually
participated in the killing, unless there is proof that they had endeavored to prevent the
killing."26 There was no evidence adduced in this case that petitioner attempted to
prevent his companions from shooting the victim. "Thus, regardless of the acts
individually performed by [the petitioner] and his co-accused, and applying the basic
principle in conspiracy that the act of one is the act of all, [the petitioner] is guilty as
a co-conspirator. Being co-conspirators, the criminal liabilities of the [petitioner and
his co-accused] are one and the same."27
The Proper Penalty: The crime of robbery with homicide is punishable under Article
294 (as amended by Republic Act No. 7659) of the Revised Penal Code by reclusion
perpetua to death. Article 6328 of the Revised Penal Code states that when the law
prescribes a penalty consisting of two indivisible penalties, and the crime is neither
attended by mitigating nor aggravating circumstances, the lesser penalty shall be
imposed. Considering that no modifying circumstance was proven to have attended
the commission of the crime, the trial court correctly sentenced the petitioner to suffer
the penalty of reclusion perpetua.29
The Civil Liabilities: In robbery with homicide, civil indemnity and moral damages in
the amount of P50,000.00 each is granted automatically in the absence of any
qualifying aggravating circumstances.30 These awards are mandatory without need of
allegation and evidence other than the death of the victim owing to the fact of the
commission of the crime. In this case, the CA properly awarded the amount
of P50,000.00 as civil indemnity. In addition, we also award the amount of P50,000.00
as moral damages.31
To be entitled to compensatory damages, it is necessary to prove the actual amount of
loss with a reasonable degree of certainty, premised upon competent proof and the best
evidence obtainable to the injured party. "[R]eceipts should support claims of actual
damages."32 Thus, as correctly held by the trial court and affirmed by the CA, the
amount of P14,500.00 incurred as funeral expenses can be sustained since these are
expenditures supported by receipts. Also, the courts below correctly held petitioner
liable to return the amount of P40,000.00 which was stolen from the gas station before
the victim was shot and killed.
WHEREFORE, the Decision of the Court of Appeals in CA-G.R. CR.-H.C. No.
01192 that affirmed with modification the Decision of the Regional Trial Court of
Malolos, Bulacan, Branch 12, in Criminal Case No. 1632-M-2001 is AFFIRMED
with further MODIFICATION that petitioner is hereby ordered to pay the heirs of
the victim moral damages in the amount of P50,000.00.
People vs banago 29 june 1999.
FACTS:
Accused-appellant Reynaldo Sahor Baago was charged before the Regional Trial
Court of Malolos, Bulacan with the crime of rape.
The prosecution presented the testimony of the thirteen-year-old victim, Dolores
Jaurigue. She testified that on October 15, 1993, she visited her sister, Dorotea
Jaurigue-Mejico, who was staying with her husband at the bodega of Bauer
Company in Marilao, Bulacan. That evening, she was left alone in the bodega as her
sister attended a party. She went to bed at around seven oclock. She was later roused
from her sleep when she felt someone embracing her. It turned out to be accused-
appellant. Accused-appellant poked a gun at her and started to remove her short
pants and underwear. She tried to shout but accused-appellant slapped her twice.
Then, he took off his pants and underwear and succeeded in having carnal
knowledge of Dolores. He admonished her not to tell anybody about the incident.
Thereafter, accused-appellant put on his pants and left the room.
When Dorotea arrived from the party, she saw accused-appellant coming out of the
bodega zipping his pants. Dorotea asked Dolores what happened but she did not
answer.
The following day, Dorotea again asked Dolores what happened the previous night.
Dolores told her sister that accused-appellant raped her. Afraid of what accused-
appellant might do to them, Dolores and Dorotea kept the incident to themselves.
It was only on March 18, 1994 that Dolores had the courage to tell her aunt, Lourdes
Corcuera, about the assault on her womanhood. Lourdes tried to talk to accused-
appellant but nothing happened.
During an altercation with Dolores mother, Antonina Jaurigue, Lourdes divulged
that Dolores was no longer a virgin. Shocked about the revelation, Antonina sought
for an explanation. Dolores was compelled to tell her mother about the rape incident.
Antonina brought Dolores to the Philippine National Police Crime Laboratory for
physical examination on March 29, 1994. The medico-legal report executed by Dr.
Jesusa N. Vergara of the Philippine National Police Crime Laboratory revealed that
Dolores was in non-virgin state physically and that there (were) no signs of recent
application of any form of violence.
On July 14, 1994, Dolores, assisted by her mother, filed a criminal complaint for
rape against accused-appellant.
ISSUE:
WON the court erred in ordering accused-appellant to indemnify (the) victim in the
amount of P50,000.00 as moral damages
HELD:
The Court affirmed the conviction but modified the decision by including civil
indemnity for rape. It reiterated that the award of moral damages is separate and
distinct from the civil indemnity awarded to rape victims. It said:
The moral damages cannot take the place of the civil indemnity. While the award of
moral damages is discretionary on the part of the court, the civil indemnity, which is
actually in the nature of actual or compensatory damages, is mandatory upon the
finding of the fact of rape. 16 Hence, in addition to the P50,000.00 moral damages,
accused appellant is ordered to pay private complainant the amount of P75,000.00 by
way of civil indemnity.