G. R. No.

207277 January 16, 2017

Malayan Insurance Co., Inc., Yvonne S. Yuchengco, Atty. Emmanuel G. Villanueva, Sonny
Rubin, Engr. Francisco Mondelo And Michael Requijo, petitioners Vs. Emma Concepcion
L. Lin, respondents
Commercial law; Insurance Code; Difference between a civil case before the RTC and an administrative case before the
IC. Petitioners causes of action in the civil case are predicated on the insurers refusal to pay her fire insurance claim
despite notice, proofs of losses and other supporting documents. The principal issue in the civil case is whether or not
petitioner is entitled to the payment of her insurance claims and damages. On the other hand, the main issue in the
administrative case is whether or not there was unreasonable delay or denial of the claims of petitioner, which will
warrant the suspension of revocation of the insurers licenses. Only preponderance of evidence is required in the civil
case, while substantial evidence is required to be established in the administrative case. Moreover, the procedures to be
followed by the trial court is governed by the Rules of Court, while the IC has its own set of rules and it is not bound
by the rigidities of the technical rules of procedure.
FACTS:
On January 4, 2010, respondent Lin filed a complaint for Collection of Sum of Money with
Damages against the petitioners and RCBC. In her complaint, it is alleged that various loans from
RCBC secured by 6 clustered warehouses were insured with Malayan against fire. On February 24,
2008, the 5 warehouses were gutted by fire. The Bureau of Fire Protection (BFP) issued a Fire
Clearance Certification that the cause of fire was accidental. However, Malayan denied her insurance
claim on the ground that the cause of fire was arson. Lin averred that RCBC refused to go after
Malayan for the payment of loan though the mortgaged properties were already lost.
On June 17, 2010, Lin filed before the Insurance Commission an administrative case against
Malayan. Lin claimed that since it had been conclusively found that the cause of the fire was
accidental, the sole issue to be resolved is whether Malayan should be held liable for unfair claim
settlement practice under Sec. 241 in relation to Sec. 247 of the Insurance Code due to the
unjustified refusal to settle her claim, and consequently, Malayans license to operate as a non-life
insurance company should be suspended or revoked until it fully complies with the IC resolution
ordering it to consider the BFPs findings.
Malayan filed a motion to dismiss the civil case based on forum shopping. It held that the
administrative case was instituted to prompt or incite IC into ordering Malayan to pay her insurance
claim. However, the RTC denied the motion to dismiss, on the ground that the administrative case
was distinct from the civil case.
Petitioners sued out a Petition for Certiorari and Prohibition before the CA. The CA affirmed the
RTC decision for the same reason that the issues raised and reliefs sought in the civil case was
distinct from the administrative case. CA held that Lin had no duty at all to inform the RTC of the
institution or pendency of the administrative case.
ISSUE:
Whether or not the administrative case may proceed alongside with the Civil Case?
HELD:
AFFIRMATIVE. Civil case before the trial court involving recovery of payment of the insureds
insurance claim plus damages, can proceed simultaneously with an administrative case before the IC.
The findings of the trial court will not necessarily cause the foreclosure of the administrative case
before the IC, or vice versa. Though both involve the same parties, same set of facts and identical
evidence, the two are still distinct from one another due to the issues to be resolved, the quantum of
evidence, the procedures to be followed and the reliefs to be adjudged by these two bodies.
Petitioners causes of action in the civil case are predicated on the insurers refusal to pay her fire
insurance claim despite notice, proofs of losses and other supporting documents. The principal issue
in the civil case is whether or not petitioner is entitled to the payment of her insurance claims and
damages. On the other hand, the main issue in the administrative case is whether or not there was
unreasonable delay or denial of the claims of petitioner, which will warrant the suspension of
revocation of the insurers licenses. Only preponderance of evidence is required in the civil case,
while substantial evidence is required to be established in the administrative case. Moreover, the
procedures to be followed by the trial court is governed by the Rules of Court, while the IC has its
own set of rules and it is not bound by the rigidities of the technical rules of procedure.
While the possibility that these two bodies will come up with conflicting resolutions on the same
issue is not far-fetched, the finding or conclusion of one would not necessarily be binding on the
other given the differences in the issues involved, the quantum of evidence required and the
procedures to be followed.