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DAMAGES

[No. L-11037. December 29, 1960]

EDGARDO CARIAGA, ET AL., plaintiffs and appellants vs. LAGUNA TAYABAS BUS COMPANY, def endant
and appellant. MANILA RAILROAD COMPANY, defendant and appellee.

1.DAMAGES; MORAL DAMAGES; RECOVERABLE ONLY IN INSTANCES ENUMERATED IN ART. 2219 OF THE
CIVIL CODE.—Article 2219 of the Civil Code enumerates the instances when moral damages may be
recovered. Plaintiffs' claim for moral damages not falling under any one of them, the same cannot be
granted.

2.ID.; ID.; WHEN RECOVERABLE FOR BREACH OF CONTRACT UNDER ART. 2220 OF THE CIVIL CODE.—
Neither could defendant LTB be held liable to pay moral damages to plaintiffs under Art. 2220 of the
Civil Code on account of breach of its contract of carriage because said defendant did not act
fraudulently or in bad faith in connection therewith.

3.ID.; ACTUAL AND COMPENSATORY DAMAGES; ONLY PARTIES TO CONTRACTS BREACHED ARE
ENTITLED TO COMPENSATORY DAMAGES RESULTING THEREFROM—Since the present action is based
upon a breach of contract of carriage and plaintiff's parents were not a party thereto and were not
themselves injured as a result of the collision, their claim for actual and compensatory damages is
without merit.

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Cariaga vs. Laguna Tayabas Bus Company

4.ATTORNEYS-AT-LAW ; ATTORNEY'S FEES; CASE NOT FALLING UNDER ANY OF THE INSTANCES
ENUMERATED IN ART. 2208 OF THE ClVIL CODE.—The present case not falling under any of the
instances enumerated in Article 2208 of the Civil Code, plaintiffs are not entitled to recover attorney's
fees.

APPEAL from a judgment of the Court of First Instance of Laguna. Alikpala, J.

The facts are stated in the opinion of the Court.

Ozaeta, Lichauco & Picazo for defendant and appellant.

E. A. Fernandez and L. H. Fernandez for plaintiffs and appellants.

Gov't Corp. Counsel A. Padilla and Atty. F. A. Umali for appellee.

DIZON, J.:
At about 1:00 p. m. on June 18, 1952, Bus No. 133 of the Laguna Tayabas Bus Company—hereinafter
referred to as the LTB—driven by Alfredo Moncada, left its station at Azcarraga St., Manila, for Lilio,
Laguna, with Edgardo Cariaga, a fourth-year medical student of the University of Santos Tomas, as one
of its passengers. At about 3:00 p. m., as the bus reached that part of the población of Bay, Laguna,
where the national highway crossed a railroad track, it bumped against the engine of a train then
passing by with such terrific force that the first six wheels of the latter were derailed, the engine and
front part of the body of the bus were wrecked, the driver of the bus died instantly, while many of its
passengers, Edgardo among them, were severely injured. Edgardo was first confined at the San Pablo
City Hospital from 5:00 p.m., June 18, 1952, to 8:25 a. m., June 20 of the same year when he was taken
to the De los Santos Clinic, Quezon City. He left that clinic on October 14 to be transferred to the
University of Santo Tomás Hospital where he stayed up to November 15. On this last date he was taken
back to the De los

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Cariaga vs. Laguna Tayabas Bus Company

Santos Clinic where he stayed until January 15, 1953. He was unconscious during the first 35 days after
the accident: at the De los Santos Clinic Dr. Gustilo removed the fractured bones which lacerated the
right frontal lobe of his brain and at the University of Santo Tomas Hospital Dr. Gustilo performed
another operation to cover a big hole 011 the right frontal part of the head with a tantalum plate.

The LTB paid the sum of P16,964.45 for all the hospital, medical and miscellaneous expenses incurred
from June 18, 1952 to April 1953. From January 15, 1953 up to ApriI of the same year Edgardo stayed in
a private house in Quezon City, the LTB having agreed to give him a subsistence allowance of P10.00
daily during his convalescence, having spent in this connection the total sum of P775.30 in addition to
the amount already referred to.

On April 24, 1953 the present action was filed to recover for Edgardo Cariaga, from the LTB and the MRR
Co., the total sum of P312,000.00 as actual, compensatory, moral and exemplary damages, and for his
parents, the sum of P18,000.00 in the same concepts. The LTB disclaimed liability claiming that the
accident was due to the negligence of its co-defendant, the Manila Railroad Company, for not providing
a crossing bar at the point where the national highway crossed the railway track, and for this reason
filed the corresponding cross-claim against the latter company to recover the total sum of P18,194.75
representing the expenses paid to Edgardo Cariaga. The Manila Railroad Company, in turn, denied
liability upon the complaint and cross-claim, alleging that it was the reckless negligence of the bus driver
that caused the accident.

The lower court held that it was the negligence of the bus driver that caused the accident and, as a
result, rendered judgment sentencing the LTB to pay Edgardo Cariaga the sum of P10,490.00 as
compensatory damages. with interest at the legal rate from the filing of the complaint, and dismissing
the cross-claim against the Manila
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Railroad Company. From this decision the Cariagas and the LTB appealed.

The Cariagas claim that the trial court erred: in awarding only P10,490.00 as compensatory damages to
Edgardo; in not awarding them actual and moral damages, and in not sentencing appellant LTB to pay
attorney's fees.

On the other hand, the LTB's principal contention in this appeal is that the trial court should have held
that the collision was due to the fault of both the locomotive driver and the bus driver and erred, as a
consequence, in not holding the Manila Railroad Company liable upon the cross-claim filed against it.

We shall first dispose of the appeal of the bus company. Its first contention is that the driver of the train
locomotive, like the bus driver, violated the law, first, in sounding the whistle only when the collision
was about to take place instead of at a distance at least 300 meters from the crossing, and second, in
not ringing the locomotive bell at all. Both contentions are without merits.

After considering the evidence presented by both parties the lower court expressly found:

"* * * While the train was approximately 300 meters from the crossing, the engineer sounded two long;
and two short whistles and upon reaching a point about 100 meters from the highway, he sounded a
long whistle which lasted up to the time the train was about to cross it. The bus proceeded on its way
without slackening its speed and it bumped against the train engine, causing the first six wheels of the
latter to be derailed."

* * * * * * *

"* * * that the train whistle had been sounded several times before it reached the crossing;. All
witnesses for the plaintiffs and the defendants are uniform in stating that they heard the train whistle
sometime before the impact and considering that some of them were in the bus at the time, the driver
thereof must have heard it because he was seated on the left front part of the bus and it was his duty
and concern to observe such fact in connection with the safe operation of the vehicle. The other L.T.B.
bus which arrived ahead at the crossing, heeded the warning- by stopping and allowing the train to pass
and so nothing happened to said vehicle. On the

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Cariaga us. Laguna Tayabas Bus Company


other hand, the driver of the bus No. 133 totally ignored the whistle and noise produced by the
approaching train and instead he tried to make the bus pass the crossing before the train by not
stopping' a few meters from the railway track and in proceeding ahead."

The above findings of the lower court are predicated mainly upon the testimony of Gregorio Ilusondo, a
witness for the Manila Railroad Company. Notwithstanding the efforts exerted by the LTB to assail his
credibility, we do not find in the record any fact or circumstance sufficient to discredit his testimony. We
have, therefore, no other alternative but to accept the findings of the trial court to the eff ect, firstly,
that the whistle of the locomotive was sounded four times—two long and two short—"as the train was
approximately 300 meters from the crossing"; secondly, that another LTB bus which arrived at the
crossing ahead of the one where Edgardo Cariaga was a passenger, paid heed to the warning and
stopped before the "crossing", while—as the LTB itself now admits (Brief p. 5)—the driver of the bus in
question totally disregarded the warning.

But to charge the MRR Co. with contributory negligence, the LTB claims that the engineer of the
locomotive failed to ring the bell altogether, in violation of section 91 of Article 1459, incorporated in
the charter of the said MRR Co. This contention—as is obvious—is the very f oundation of the cross-
claim interposed by the LTB against its co-defendant. The former, therefore, had the burden of proving
it affirmatively because a violation of law is never presumed. The record discloses that this burden has
not been satisfactorily discharged.

The Cariagas, as appellants, claim that the award of P10,000.00 compensatory damages to Edgardo is
inadequate considering the nature and the after effects of the physical injuries suffered by him. After a
careful consideration of the evidence on this point we find their contention to be well founded.

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Cariaga vs. Laguna Tayabas Bus Company

From the deposition of Dr. Romeo Gustilo, a neurosurgeon, it appears that, as a result of the injuries
suffered by Edgardo, his right forehead was fractured necessitating the removal of practically all of the
right frontal lobe of his brain. From the testimony of Dr. Jose A. Fernandez, a psychiatrist, it may be
gathered that, because of the physical injuries suffered by Edgardo, his mentality has been so reduced
that he can no longer finish his studies as a medical student; that he has become completely misfit for
any kind of work; that he can hardly walk around without someone helping him, and has to use a brace
on his left leg and feet.

Upon the whole evidence on the matter, the lower court found that the removal of the right frontal lobe
of the brain of Edgardo reduced his intelligence by about 50 % ; that due to the replacement of the right
frontal bone of his head with a tantalum plate Edgardo has to lead a quite and retired life because "if
the tantalum plate is pressed in or dented it would cause his death."
The impression one gathers f rom this evidence is that, as a result of the physical injuries suffered by
Edgardo Cariaga, he is now in a helpless condition, virtually an invalid, both physically and mentally.

Appellant LTB admits that under Art. 2201 of the Civil Code the damages for which the obligor, guilty of
a breach of contract but who acted in good faith, is liable shall be those that are the natural and
probable consequences of the breach and which the parties had foreseen or could have reasonably
foreseen at the time the obligation was constituted, provided such damages, according to Art. 2199 of
the same Code, have been duly proved. Upon this premise it claims that only the actual damages
suffered by Edgardo Cariaga consisting of medical, hospital and other expenses in the total sum of
P17,719.75 are within this category. We are of the opinion, however, that the income which Edgardo
Cariaga could earn if he should finish the medical course and pass the corresponding board
examinations must

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Cariaga vs. Laguna Tayabas Bus Company

be deemed to be within the same category because they could have reasonably been foreseen by the
parties at the time he boarded the bus No. 133 owned and operated by the LTB. At that time he was
already a fourth-year student in medicine in a reputable university. While his scholastic record may not
be first rate (Exhibits 4, 4-A to 4C), it is, nevertheless, sufficient to justify the assumption that he could
have finished the course and would have passed the board test in due time. As regards the income that
he could possibly earn as a medical practitioner, it appears that, according to Dr. Amado Doria, a witness
for the LTB, the amount of P300.00 could easily be expected as the minimum monthly income of
Edgardo had he finished his studies.

Upon consideration of all the facts mentioned heretofore, this Court is of the opinion, and so holds, that
the compensatory damages awarded to Edgardo Cariaga should be increased to P25,000.00.

Edgardo Cariaga's claim for moral damages and attorney's fees was denied by the trial court, the
pertinent portion of its decision reading as follows:

"Plaintiffs' claim for moral damages cannot also be granted. Article 2219 of the Civil Code enumerates
the instances when moral damages may be covered and the case under consideration does not fall
under any one of them. The present action cannot come under paragraph 2 of said article because it is
not one of quasidelict and cannot be considered as such because of the pre-existing contractual relation
between the Laguna Tayabas Bus Company and Edgardo Cariaga. Neither could defendant Laguna
Tayabas Bus Company be held liable to pay moral damages to Edgardo Cariaga under Article 2220 of the
Civil Code on account of breach of its contract of carriage because said defendant did not act
fraudulently or in bad faith in connection therewith. Defendant Laguna Tayabas Bus Company had
exercised due diligence in the selection and supervision of its employees like the drivers of its buses in
connection with the discharge of their duties and so it must be considered an obligor in good faith.
"The plaintiff Edgardo Cariaga is also not entitled to recover for attorney's fees, because this case does
not fall under any of the instances enumerated in Article 2208 of the Civil Code."

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Cariaga vs. Laguna Tayabas Bus Company

We agree with the trial court and, to the reasons given above, we add those given by this Court in
Cachero vs. Manila Yellow Taxicab Co., Inc. (101 Phil., 523, 530, 533) :

"A mere perusal of plaintiff's complaint will show that his action against the defendant is predicated on
an alleged breach of contract of carriage, i.e., the failure of the defendant to bring him 'safely and
without mishaps' to his destination, and it is to be noted that the chauffeur of defendant's taxicab that
plaintiff used when he received the injuries involved herein, Gregorio Mira, has not even been made a
party defendant to this case.

"Considering, therefore, the nature of plaintiff's action in this case, is he entitled to compensation for
moral damages? Article 2219 of the Civil Code says the following:

'Art. 2219. Moral damages may be recovered in the following and analogous cases:

(1) A criminal offense resulting in physical injuries;

(2) Quasi-delicts causing physical injuries;

(3) Seduction, abduction, rape, or other lascivious acts;

(4) Adultery or concubinage;

(5) Illegal or arbitrary detention or arrest;

(6) Illegal search;

(7) Libel, slander or any other form of defamation;

(8) Malicious prosecution;

(9) Acts mentioned in Article 309;

(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34 and 35.

* * * * *

"Of the cases enumerated in the just quoted Article 2219 only the first two may have any bearing on the
case at bar. We find, however, with regard to the first that the defendant herein has not committed in
connection with this case any 'criminal offense resulting in physical injuries'. The one that committed
the offense against the plaintiff is Gregorio Mira, and that is why he has been already prosecuted and
punished therefor. Altho (a) owners and managers of an establishment or enterprise are responsible for
damages caused by their employees in the service of the branches in which the latter are employed or
on the occasion of their functions; (b) employers are likewise liable for damages caused by their
employees and household helpers acting within the scope of their assigned task (Article 218 of the Civil
Code); and (c) employers and corporations engaged in any kind of industry are subsidiary civilly liable for
felonies committed by their employees

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Cariaga vs. Laguna Tayabas Bus Company

in the discharge of their duties (Art. 103, Revised Penal Code), plaintiff herein does not maintain this
action under the provisions of any of the articles of the codes just mentioned and against all the persons
who might be liable for the damages caused, but as a result of an admitted breach of contract of
carriage and against the defendant employer alone. We, therefore, hold that the case at bar does not
come within the exception of paragraph 1, Article 2219 of the Civil Code.

"The present complaint is not based either on a 'quasi-delict causing physical injuries' (Art. 2219, par. 2,
of the Civil Code). From the report of the Code Commission on the new Civil Code We copy the
following:

'A question of nomenclature confronted the Commission. After a careful deliberation, it was agreed to
use the term 'quasi-delict' for those obligations which do not arise from law, contracts, quasi-contracts,
or criminal offenses. They are known in Spanish legal treatises as 'culpa, aquiliana', culpa-extra-
contractual' or 'cuasi-delitos'. The phrase 'culpa-extra-contractual' or its translation 'extra-contractual-
fault' was eliminated because it did not exclude quasi-contractual or penal obligations. 'Aquilian fault'
might have been selected, but it was thought inadvisable to refer to so ancient a law as the 'Lex Aquilia'.
So 'quasi-delict' was chosen, which more nearly corresponds to the Roman Law classification of
obligations, and is in harmony with the nature of this kind of liability.'

The Commission also thought of the possibility of adopting the word "tort" from Anglo-American law.
But "tort" under that system is much broader than the Spanish-Philippine concept of obligations arising
from non-contractual negligence. 'Tort' in AngloAmerican jurisprudence includes not only negligence,
but also intentional criminal act, such as assault and battery, false imprisonment and deceit. In the
general plan of the Philippine legal system, intentional and malicious acts are governed by the Penal
Code, although certain exceptions are made in the Project/ (Report of the Code Commission, pp. 161-
162).

"In the case of Cangco, vs. Manila Railroad, 38 Phil. 768, We established the distinction between
obligation derived from negligence and obligation as a result of a breach of contract. Thus, we said:
'lt is important to note that the foundation of the legal liability of the defendant is the contract of
carriage, and that the obligation to respond for the damage which plaintiff has suffered arises, if at all,
from the breach of that contract by reason of the failure of defendant to exercise due care in its
performance. That is to say, its liability is direct and immediate, differing essentially in the

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Cariaga vs. Laguna Tayabas Bus Company

legal viewpoint from that presumptive responsibility for the negligence of its servants, imposed by
Article 1903 of the Civil Code (Art. 2180 of the new), which can be rebutted by proof of the exercise of
due care in their selection of supervision. Article 1903 is not applicable to obligations arising EX
CONTRACTU, but only to extra-contractual obligations—or to use the technical form of expression, that
article relates only to CULPA AQUILIANA.' and not to CULPA CONTRACTUAL.'

"The decisions in the cases of Castro vs. Acro Taxicab Co., (82 Phil., 359; 46 Off. Gaz., No. 5, p. 2023);
Lilius et al. vs. Manila Railroad, 59 Phil., 758) and others, wherein moral damages were awarded to the
plaintiffs, are not applicable to the case at bar because said decisions were rendered before the
effectivity of the new Civil Code (August 30, 1950) and for the further reason that the complaints filed
therein were based on different causes of action.

"In view of the foregoing the sum of P2,000 awarded as moral damages by the trial court has to be
eliminated, for under the law it is not a compensation awardable in a case like the one at bar."

What has been said heretofore relative to the moral damages claimed by Edgardo Cariaga obviously
applies with greater force to a similar claim (4th assignment of error) made by his parents.

The claim made by said spouses for actual and compensatory damages is likewise without merits. As
held by the trial court, in so far as the LTB is concerned, the present action is based upon a breach of
contract of carriage to which said spouses were not a party, and neither can they premise their claim
upon the negligence or quasidelict of the LTB f or the simple reason that they were not themselves
injured as a result of the collision between the LTB bus and the train owned by the Manila Railroad
Company.

Wherefore, modified as above indicated, the appealed judgment is hereby affirmed in all other respects,
with costs against appellant LTB.

Parás, C. J., Bengzon, Bautista Angelo, Labrador, Reyes, J. B. L., Barrera, Gutierrez David, and Paredes,
JJ., concur.

Judgment affirmed with modification. Cariaga vs. Laguna Tayabas Bus Company, 110 Phil. 346, No. L-
11037 December 29, 1960
[No. L-3678. February 29, 1952]

JOSE MENDOZA, plaintiff and appellant, vs. PHILIPPINE AIR LINES, INC., defendant and appellee.

1.CARRIER; AVIATION; CONTRACT OF TRANSPORTATION BY AIR, COMMERCIAL.—A contract of


transportation by air may be regarded as commercial. The reason is that the transportation company is
a common carrier; besides, air transportation is clearly

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Mendoza vs. Philippine Air Lines, Inc.

similar or analogous to land and water transportation. The obvious reason for its non-inclusion in the
Code of Commerce was that at the time of its promulgation transportation by air on a commercial basis
was not yet known.

2.ID.; ID.; CARRIER BY AIR CRAFT.—The principles which govern oarriers by other means, such as by
railroad or motor bus, govern carriers by aircraft. (64 Am. Jur. 33).

3.ID.; DAMAGES; UNFORSEEN DAMAGES.—The defendant company can not be held liable for damages
where it could not have forseen the damages that would be suffered by the plaintiff upon failure to
deliver the can of film for reason that the plans of the plaintiff to exhibit that film during the town fiesta
and his preparation, specially the announcement of said exhibition by poster and advertisement in the
newspapers were not called to the defendant's attention.

4.ID.; RIGHT TO PROMPT DELIVERY.—Common carriers are not obligated by law to carry and to deliver
merchandise, and persons are not vested with the right to prompt delivery, unless such common
carriers previously assume the obligation. Said righta and obligations are created by a specific contract
entered into by the parties.

5.ID.; SHIPPING; WHEN CONSIGNEE BECOMES PARTY TO THE CONTRACT.—The right of the shipper to
countermand the shipment terminates when the consignee or legitimate holder of the bill of lading
appears with such bill of lading before the carrier and makes himself a party to the contract. Prior to
that time, the consignee is stranger to the contract.

6.ID.; CONTRACT; CONSIGNEE BECOMES A PARTY TO THE CONTRACT.—Where the contract of carriage
between the consignor and the defendant carrier contains the stipulations of delivery to the consignee,
the latter's demand for the delivery of the can of film to him at the provincial airport may be regarded as
a notice of his acceptance of the stipulation of the delivery to him contained in the fulfillment of the
contract of carriage and delivery. In this case he also made himself a party to the contract, or at least has
come to court to enforce it. His cause of action must necessarily be founded on its breach.

7.ID.; DAMAGES; PROMPT DELIVERY;—Where failure to exhibit films on a certain day wcmld spell
substantial damages or considerable loss of profits, including waste of efforts on preparations and
expense incurred in advertisements, exhibitors, for their security, may either get hold of the films well
ahead of the time of exhibition in order to rnake allowances for any hitch in the delivery, or else enter
into a special contract or make a suitable arrangement with the common carrier for the prompt

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PHILIPPINE REPORTS ANNOTATED

Mendoza vs. Philippine Air Lines, Inc.

delivery of the fihns, calling the attention of the carrier to the circumstances surrounding the case and
the approximate amount of damages to be auffered in case of delay.

APPEAL from a judgment of the Court of First Instance of Camarines Sur. Leuterio, J.

The facts are stated in the opinion of the Court.

Manuel O. Chan, Reyes and Dy-Liaco for appellant.

Daniel Me. Gomez and Emigdio Tanjuatco for appellee.

MONTEMAYOR, J.:

The present appeal by plaintiff Jose Mendoza from the decision of the Court of First Instance of
Camarines Sur, has come directly to this Tribunal for the reason that both parties, appellant and
appellee, accepted the findings of fact made by the trial court and here raise only questions of law. On
our part, we must also accept said findings of fact of the lower court.

In the year 1948, appellant Jose Mendoza was the owner of the Cita Theater located in the City of Naga,
Camarines Sur, where he used to exhibit movie pictures booked from movie producers or film owners in
Manila. The fiesta or town holiday of the City of Naga, held on September 17 and 18, yearly, was usually
attended by a great many people, mostly from the Bicol region, especially since the Patron Saint Virgin
of Pena Francia was believed by many to be miraculous. -As a good businessman, appellant, taking
advantage of these circumstances, decided to exhibit a film which would fit the occasion and have a
special attraction and significance to the people attending said fiesta. A month before the holiday, that
is to say, August 1948, he contracted with the LVN pictures Inc., a movie producer in Manila for him to
show during the town fiesta the Tagalog film entitled "Himala ng Birhen" or Miracle of the Virgin. He
made extensive preparations; he had two thousand posters printed and later distributed not only in the
City of Naga but also in the neighboring towns. He also advertised in a weekly of general circulation in
the province. The posters and advertisement stated that the

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Mendoza vs. Philippine Air Lines, Inc.

film would be shown in the Cita Theater on the 17th and 18th of September, corresponding to the eve
and day of the fiesta itself.

In pursuance of the agreement between the LVN Pictures Inc. and Mendoza, the former on September
17th, 1948, delivered to the defendant Philippine Airlines (PAL) whose planes carried passengers and
cargo and made regular trips from Manila to the Pili Air Port near Naga, Camarines Sur, a can containing
the film "Himala ng Birhen" consigned to the Cita Theater. For this shipment the defendant issued its Air
Way Bill No. 317133 marked Exhibit "1". This can of films was loaded on flight 113 of the defendant, the
plane arriving at the Air Port at Pili a little after four o'clock in the afternoon of the same day, September
17th. For reasons not explained by the defendant, but which would appear to be the fault of its
employees or agents, this can of film was not unloaded at Pili Air Port and it was brought back to Manila.
Mendoza who had completed all arrangements for the exhibition of the film beginning in the evening of
September 17th, to exploit the presence of the big crowd that came to attend the town fiesta, went to
the Air Port and inquired from the defendant's station master there about the can of film. Said station
master could not explain why the film was not unloaded and sent several radiograms to hia principal in
Manila making inquiries and asking that the film be sent to Naga inunediately. After investigation and
search in the Manila office, the film was finally located the following day, September 18th, and then
shipped to the Pili Air Port on September 20th. Mendoza received it and exhibited the film but he had
missed his opportunity to realize a large profit as he expected for the people aftcr the fiesta had already
left for their towns. To recoup his losses, Mendoza brought this action against the PAL. After trial, the
lower court found that because of his failure to exhibit the film "Himala ng Birhen" during the town
fiesta, Mendoza suffered damages or rather

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Mendoza vs. Philippine Air Lines, Inc.

failed to earn profits in the amount of P3,000.00, but finding the PAL not liable for said damages,
dismissed the complaint.

To avoid liability, defendant-appellee, called the attention of the trial court to the terms and conditions
of paragraph 6 of the Way Bill printed on the back thereof, which paragraph reads as follows:

"6. The Carrier does not obligate itself to carry the Goods by any specified aircraft or on a specified time.
Said Carrier being hereby authorized to deviate from the route of the shipment without any liability
therefor."

It claimed that since there was no obligation on its part to carry the film in question on any specified
time, it could not be held accountable for the delay of about three days. The trial court, however, found
and held that although the defendant was not obligated to load the film on any specified plane or on
any particular day, once said can of film was loaded and shipped on one of its planes making the trip to
Camarines, then it assumed the obligation to unload it at its point of destination and deliver it to the
consignee, and its unexplained failure to comply with this duty constituted negligence. It however found
that fraud was not involved and that the defendant was a debtor in good faith.

The trial court presided over by Judge Jose N. Leuterio in a well-considered decision citing authorities,
particularly the case of Daywalt vs. Corporacion de PP. Agustinos Recoletos, 39 Phil. 587, held that not
because plaintiff failed to realize profits in the sum of P3,000.00 due to the negligence of the defendant,
should the latter be made to reimburse him said sum. Applying the provisions of Art. 1107 of the Civil
Code which provides that losses and damages for which a debtor in good faith is liable are those
foreseen, or which might have been foreseen, at the time of constituting the obligation, and which are a
necessary consequence of the failure to perform it, the trial court held that inasmuch as these damages
suffered by Mendoza were not foreseen or could not have been foreseen

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Mendoza vs. Philippine Air Lines, Inc.

at the time that the def endant accepted the can of film f or shipment, for the reason that neither the
shipper LVN Pictures Inc. nor the consignee Mendoza had called its attention to the special
circumstances attending the shipment and the showing of the film during the town fiesta of Naga,
plaintiff may not recover the damages sought.

Counsel for appellant insists that the articles of the Code of Commerce rather than those of the Civil
Cade should have been applied in deciding this case for the reason that the shipment of the can of film
is an act of commerce; that the contract of transportation in this case should be considered commercial
under Art. 349 of the Code of Commerce because it not only involves merchandise or an object of
commerce but also the transportation company, the defendant herein, was a common carrier, that is to
say, customarily engaged in transportation for the public, and that although the contract of
transportation was not by land or waterways as defined in said Art. 349, nevertheless, air transportation
being analogous to land and water transportation, should be considered as included, especially in view
of the second paragraph of Art. 2 of the same Code which says that transactions covered by the Code of
Commerce and all others of analogous character shalt be deemed acts of commerce. The trial court,
however, disagreed to this contention and opined that air transportation not being expressly covered by
the Code of Commerce, cannot be governed by its provisions.

We believe that whether or not transportation by air should be regarded as a commercial contract
under Art. 349, would be immaterial in the present case, as will be explained later. Without making a
definite ruling on the civil or commercial nature of transportation by air, it being unnecessary, we are
inclined to believe and to hold that a contract of transportation by air may be regarded as commercial.
The reason is that at least in the present case the transportation company (PAL) is a common

842
842

PHILIPPINE REPORTS ANNOTATED

Mendoza vs. Philippine Air Lines, Ine.

carrier; besides, air transportation is clearly similar or analogous to land and water transportation. The
obvious reason for its non-inclusion in the Code of Commerce was that at the time of its promulgation,
transportation by air on a commercial basis was not yet known. In the United States where air
transportation has reached its highest development, an airline company engaged in the transportation
business is regarded as a common carrier.

"The principles which govern carriers by other means, such as by railroad or motor bus, govern carriers
by aircraft." 6 Am. Jur., Aviation, Sec. 56, p. 33.

"When Aircraft Operator is Common Carrier.—That aircraft and the industry of carriage by aircraft are
new is no reason why one in fact employing aircraft as common-carrier vehicles should not be classified
as a cominon carriei- and charged with liability as such. There can be no doubt, under the general law of
common carriers, that those air lines and aircraft ownei-s engaged in the passenger service on regular
schedules on definite routes, who solicit the patronage of the traveling public, advertise schedules for
routes, times of leaving, and 1'ates of fare, and rnake the usual stipulation as to baggage, are common
carriers by air. A flying scrvice company which, according to its printed advertising, will take anyone
anywhere at any tiine, though not operating on regular routes or schedules, and basing its charges not
on the number of passengers, but on the operating cost of the plane per mile, has been held to be a
common carrier. It is not necessary, in orcler to make one carrying passengers by aircraft a common
carrier of passengers that the passengers be carried from one point to another; the status and the
liability as a common carrier may exist notwithstanding the passenger's ticket issued by an airplane
carrier of passengers for hire contains a statement that it is not a common cavrier, etc., or a stipulation
that it is to be held only for its proven negligence. But an airplane owner cannot be classed as a common
carrier of passengers unless he undertakes, for hire, to carry all persons who apply for passage
indiscriminately as long as there is room and no legal excuse for refusing. * * *" 6 Am. Jur., Aviation, Sec.
58, pp. 34-35.

"The rules governing the business of a common carrier by airship or flying machine may be readily
assimilated to those applied to other common carriers." 2 C.J. S., 1951, Cumulative Pocket Part, Acriol
Navigation, Scc. 38, p. 99.

"The test of whether one is a common carrier by air is whether hc holcls out that hc will carry for hire, so
long as he has room,

843

VOL. 90, FEBRUARY 29, 1952

843
Mendoza vs. Philippine Air Lines, Inc.

goods of everyone bringing goods to him for carriage, not whether he is carrying as a public
employment or whether he carries to a fixed place." (Ibid., Sec. 39, p. 99.

Appellant contends that Art. 358 of the Code of Commerce should govern the award of damages in his
favor. Said article provides that if there is no period fixed for the delivery of the goods, the carrier shall
be bound to forward them in the first shipment of the same or similar merchandise which he may make
to the point of delivery, and that upon failure to do so, the damages caused by the delay should be
suffered by the carrier. This is a general provision for ordinary damages and is no different from the
provisions of the Civil Code, particularly Art. 1101 thereof, providing for the payment of damages caused
by the negligence or delay in the fulfillment of one's obligation. Even applying the provisions of the Code
of Commerce, as already stated, the pertinent provisions regarding damages only treats of ordinary
damages or damages in general, not special damages like those suffered by the plaintiff herein. Article 2
of the Code of Commerce provides that commercial transactions are to be governed by the provisions of
the Code of Commerce, but in the absence of applicable provisions, they will be governed by the usages
of commerce generally observed in each place; and in default of both, by those of the Civil Law. So that
assuming that the present case involved a cornmercial transaction, still inasmuch as the special damages
herein claimed finds no applicable provision in the Code of Commerce, neither has it been shown that
there are any commercial usages applicable thereto, then in the last analysis, the rules of the civil law
would have to come into play. Under Art. 1107 of the Civil Code, a debtor in good faith like the
defendant herein, may be held liable only for damages that were foreseen or might have been foreseen
at the time the contract of transportation was entered into. The trial court correctly found that the
defendant company could not have foreseen the damages that would be suffered by Mendoza upon
failure to deliver

844

844

PHILIPPINE REPORTS ANNOTATED

Mendoza vs. Philippine Air Lines, Inc.

the can of film on the 17th of September, 1948 for the reason that the plans of Mendoza to exhibit that
film during the town fiesta and his preparations, specially the announcement of said exhibition by
posters and advertisement in the newspaper, were not called to the defendant's attention.

In our research for authorities we have found a case very similar to the one under consideration. In the
case of Chapman vs. Fargo, L.R.A. (1918 F) p. 1049, the plaintiff m Troy, New Yark, delivered motion
picture films to the defendant Fargo, an express company, consigned and to be delivered to him in
Utica. At the time of shipment the attention of the express company was called to the fact that the
shipment involved motion picture films to be exhibited in Utica, and that they should be sent to their
destination, rush. There was delay in their delivery and it was found that the plaintiff because of his
failure to exhibit the film in Utica due to the delay suffered damages or loss of profits. But the highest
court in the State of New York refused to award him special damages. Said appellate court observed:
"But before defendant could be held to special damages, such as the present alleged loss of profits on
account of clelay or failure of delivery, it must have appeared that he had notice at the time of delivery
to him of the particular circumstances attending the shipment, and which probably would lead to such
special loss if he defaulted. Or, as the rule has been stated in another form, in order to impose on the
defaulting party further liability than for damages naturally and directly, i.e., in the ordinary course of
things, arising from a breach of contract, such unusual or extraordinary damages must have been
brought within the contemplation of the parties as the probable result of a breach at the time of or prior
to contracting. Generally, notice then of any special circumstances which will show that the damages to
be anticipated from a breach would be enhanced has been held sufflcient for this effect."

As may be seen, that New York case is a stronger one than the present case for the reason that the
attention of the common carrier in said case was called to the nature

845

VOL. 90, FEBRUARY 29, 1952

845

Mendoza vs. Philippine Air Lines, Inc.

of the articles shipped, the purpose of shipment, and the desire to rush the shipment, circumstances
and facts absent in the present case.

But appellant now contends that he is not suing on a breach of contract but on a tort as provided for in
Art. 1902 of the Civil Code. We are a little perplexed as lo this new theory of the appellant. First, he
insists that the articles of the Code of Commerce should be applied; that he invokes the provisions of
said Code governing the obligations of a common carrier to make prompt delivery of goods given to it
under a contract of transportation. Later, as already said, he says that he was never a party to the
contract of transportation and was a complete stranger to it, and that he is now suing on a tort or a
violation of his rights as a stranger (culpa aquiliana). If he does not invoke the contract of carriage
entered into with the defendant company, then he would hardly have any leg to stand on. His right to
prompt delivery of the can of film at the Pili Air Port stems and is derived from the contract of carriage
under which contract, the PAL undertook to carry the can of film safely and to deliver it to him promptly.
Take away or ignore that contract and the obligation to carry and to deliver and the right to prompt
delivery disappear. Common carriers are not obligated by law to carry and to deliver merchandise, and
persons are not vested with the right to prompt delivery, unless such common carriers previously
assume the obligation. Said rights and obligations are created by a specific contract entered into by the
parties. In the present case, the findings of the trial court which as already stated, are accepted by the
parties and which we must accept are to the effect that tho LVN Pictures Inc. and Jose Mendoza on one
sicle, and the defendant company on the other, entered into a contract of transportation. (p. 29, Rec. on
Appeal). One interpretation of said finding is that the LVN Pictures Inc. through previous agreement with
Mendoza acted as

846
846

PHILIPPINE REPORTS ANNOTATED

Mendoza vs. Philippine Air Lines, Inc.

the latter's agent. When he negotiated with the LVN Pictures Inc. to rent the film "Himala ng Birhen"
and show it during the Naga town fiesta, he most probably authorized and enjoined the Picture
Company to ship the film for him on the PAL on September 17th. Another interpretation is that even if
the LVN Pictures Inc. as consignor of its own initiative, and acting independently of Mendoza for the
time being, made Mendoza as consignee, a stranger to the contract if that is possible, nevertheless
when he, Mendoza, appeared at the Pili Air Port armed with the copy of the Air Way Bill (Exh. 1)
demanding the delivery of the shipment to him, he thereby made himself a party to the contract of
transportation. The very citation made by appellant in his memorandum supports this view. Speaking of
the possibility of a coriflict between the order of the shipper on the one hand and the order of the
consignee on the other, as when the shipper orders the shipping company to return or retain the goods
shipped while the consignee demands their delivery, Malagarriga in his book Codigo de Comercio
Comentado, Vol. I, p. 400, citing a decision of Argentina Court of Appeals on commercial matters, cited
by Tolentino in Vol. II of his book entitled "Commentaries and Jurisprudence on the Commercial Laws of
the Philippines" p. 209, says that the right of the shipper to countermand the shipment terminates when
the consignee or legitimate holder of the bill of lading appears with such bill of lading before the carrier
and makes himself a party to the contract. Prior to that time, he is stranger to the contract.

Still another view of this phase of the case is that contemplated in Art. 1257, paragraph 2, of the old Civil
Code which reads thus:

"Should the contract contain any stipulation in favor of a third person, he may demand its fulfillment,
provided he has given notice of his acceptance to the person bound before the stipulation has been
revoked."

Here, the contract of carriage between the LVN Pictures Inc. and the defendant carrier contains the
stipulations

847

VOL. 90, FEBRUARY 29, 1952

847

Davao Stevedores Mutual Benefit Assn. vs. Compañia Maritima, et al.

of delivery to Mendoza as consignee. His demand for the delivery of the can of film to him at the Pili Air
Port may be regarded as a notice of his acceptance of the stipulation of the delivery in his favor
contained in the contract of carriage, such demand being one for the fulfillment of the contract of
carriage and delivery. In this case he also made himself a party to the contract, or at least has come to
court to enforce it. His cause of action must necessarily be founded on its breach.
One can readily sympathize with the appellant herein for his loss of profits which he expected to realize.
But he overlooked the legal angle. In situations like the present where failure to exhibit films on a
certain day would spell substantial damages or considerable loss of profits, including waste of efforts on
preparations and expenses incurred in advertisements, exhibitors, for their securily, may either get hold
of the fllms well ahead of the time of exhibition in order to make allowance for any hitch in the delivery,
or else enter into a special contract or make a suitable arrangement with the common carrier for tho
prompt delivery of the films, calling the attention of the carrier to the circumstances surrounding the
case and the approximate amount of damages to be suffered in case of delay.

Finding no reversible error in the decision appealed from, the same is hereby affirmed. No
pronouncement as to costs. So ordered.

Parás, C. J., Feria, Bengzon, Padilla, Reyes, Jugo and Bautista Angelo, JJ., concur.

PARAS, C. J.:

I certify that Mr. Justice Tuason voted for the affirmance.

Judgment affirmed.

________________ Mendoza vs. Philippine Air Lines, Inc., 90 Phil. 836, No. L-3678 February 29, 1952

VOL. 31, FEBRUARY 18, 1970

511

Villa Rey Transit, Inc. vs. Court of Appeals

No. L-25499. February 18, 1970.

VILLA REY TRANSIT,INC., petitioner, vs. THE COURT OF APPEALS,TRINIDAD A. QUINTOS,PRIMA A


QUINTOS, AND JULITA A. QUINTOS, respondents.

Civil law; Damages; Computation of indemnity; Life expectancy of victim as basis in fixing amount
recoverable.—Life expectancy of the victim is, not only relevant, but also an important element in fixing
the amount recoverable as damages.

512

512

SUPREME COURT REPORTS ANNOTATED

Villa Rey Transit, Inc. vs. Court of Appeals

Although it is not the sole element determinative of said amount no cogent reason has been given to
warrant its disregard and the adoption of a purely arbitrary standard such as a four-year rule.
Same; Same; Same; Same; Case at bar distinguished from Alcantara v. Svrro, 93 Phil. 472.—The ruling in
Alcantara v. Surro in which the damages were computed on a four-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, does
not apply in the instant ease. In the first 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, but in the instant case, the
question was squarely presented as issue.

Same; Same; Same: Determination of losses or damage sustained by dependents and intestate heirs of
the deceased; Earning capacity, how included.—In the determination of the losses or damages sustained
by dependents and intestate heirs of the deceased, 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 defendant. In fixing the amount of that support, the necessary
expenses of deceased of his own living 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 than the
necessary expense for his own living. Stated otherwise, the amount recoverable is not the 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 ffross earning, are to be considered, that is, the total of
the earnings less expenses necessary in the creation of such earning or income and less living and other
incidental expenses.

PETITION for review by certiorari of a decision of the Court of Appeals,

The facts are stated in the opinion of the Court.

Laurea & Pison for petitioner.

Bonifacio M. Abad, Jr. for respondents.

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513

Villa Rey Transit, Inc. vs. Court of Appeals

CONCEPCION, CJ.:

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 heroin petitioner, Villa Rey

514

514

SUPREME COURT REPORTS ANNOTATED

Villa Rey Transit, Inc. vs. Court of Appeals

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 F79.615.95, 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 cer= tiorari, 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.

515

VOL. 31, FEBRUARY 18, 1970

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Villa Rey Transit, Inc. vs. Court of Appeals

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 [80-30] = 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. Surro 1 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

_______________
1 93 Phil 472.

516

516

SUPREME COURT REPORTS ANNOTATED

Villa Rey Transit, Inc. vs. Court of Appeals

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 CJS., 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 (25 C.J.S., 1264-1260).”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 Al-

_______________

2 Italics ours.

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VOL. 31, FEBRUARY 18, 1970


517

Villa Rey Transit, Inc. vs. Court of Appeals

cantara 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 living3
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 considered5 that is, the total of the earnings less expenses necessary in the

_______________

3 Pitman v. Merriman, 117 A. 18, 19, 80 N.H. 295.

4 Lynch v. Lynch, 195 A. 799; Lockerman v. Hurlock, 126 A 482 2 WW. Harr. 479; Lemmon v. Broadwater,
108 A. 273, 7*Boyce 472; Louisville & N.R.R. Co. v. Revermans Adm’x, 15 S.W. 2d 300; Heppner v.
Atchison, T. & S.F. By. Co., 297 S.W. 2d 497; Darnell v. Panhandle Co-op. Assn 120 N. W 2d 278 175 Neb.
40.

5 Meehan v. Central R. Co. of New Jersey, D.C.N.Y., 181, F. Supp. 594.

518

518

SUPREME COURT REPORTS ANNOTATED

Villa Rey Transit, Inc. vs. Court of Appeals

creation of such earnings or income6 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 Pl,184.00 a year, or about P100.00 a month, and that,
consequently, the loss sustained by his sisters may be roughly estimated at Pl,000.00 a year or
P33,333.33 for the 33-1/3 years of his life expectancy. To this sum of F33,333.33, 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) Pl,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 r49,561.28, 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

_______________

6 Frasier v. Public Service Interstate Transp. Co., C.A.N.Y., 244 F. 2d. 668.

7 Hanks v. Norfolk & Western Ry. Co., 52 S.E. 2d 717, 230 N.C. 179; Gardner v. National Bulk Carriers,
Inc, D-C, Va, 221 F. Supp. 243, affirmed, CA., 333 F. 2d 676; Meehan v. Central R. Co. of New Jersey, D.C.
N.Y., 181 F. Supp. 594; Frazier v. Ewell Engineering & Contracting Co., 62 So. 2d 51. See, also, 2 Cooley
on Torts, 168-169.

8 People v. Pantoja, L-18793, Oct. 11, 1968; People v. Sangaran, L-21757, Nov. 26, 1968; People v.
Gutierrez, L-25372, Nov. 29, 1968; People v. Buenbrazo, L-27852, Nov. 29, 1968; People v. Bakang, L-
20908, Jan. 31, 1969; People v. Labutin, L-23513, Jan. 31, 1969; People v. Acabado, L-26104, Jan. 31,
1969; People v. Vacal, L-20913, Feb. 27, 1969; People v. Gonzales, L-23303-04, May 20, 1969: People v.
Tapac, L-26491, May 20, 1969; People v. Aranas, L-27851, Oct. 28, 1969.

519

VOL. 31, FEBRUARY 18, 1970

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Villa Rey Transit, Inc. vs. Court of Appeals

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.

Decision affirmed with modification.

Notes.—Damages arising from death; factors to consider.—The life expectancy of the accident victim
may be an important factor to consider in assessing damages arising from death; but there is local
authority for the proposition that the damages could be greatly enhanced by showing the personal
characteristics of the deceased (Manzares vs. Moreta, 38 Phil. 821).
It has, however, been held that it is not necessarily error for the court to rest its determination of
damages in a wrongful death action on less than all the factors which might be considered (Alcantara vs.
Surro, L-4555, July 23, 1953, 49 O.G. 2769).

As to the amount of damages recoverable by the heirs of a deceased bus line passenger who was
burned to death after the bus caught fire during rescue attempts following a wreck, negligence of
defendant bus-line operator, through his agents and servants, being found to be the proximate cause of
death, it was held that the plaintiffs were entitled to recover, considering the earning* capacity of the
deceased, as well as other elements of damages, P6,000 as compensation for actual, moral and other
damages (Bataclan vs. Medina, L-10126, Oct. 22, 1957).

In a civil action to recover damages for the death of a woman while riding as a passenger in defendant’s
bus, it appearing that she was 33 years old at the time, with minor children, and had average earnings of
P120 a month, an award of F15,000 as indemnity to her heirs was considered adequate to cover the loss
of her earnings and

520

520

SUPREME COURT REPORTS ANNOTATED

Republic Flour Mills, Inc, vs. Commissioner of Internal Revenue

deprivation of her protection, guidance and company, together with property losses in the amount of
P394 in the form of cash, etc., carried at the time of the accident, burial expenses, etc. (Necesteo vs.
Paras, L-10605, June 30, 1958).

———————— Villa Rey Transit, Inc. vs. Court of Appeals, 31 SCRA 511, No. L-25499 February 18,
1970

VOL. 132, SEPTEMBER 30, 1984

441

Bagumbayan Corp. vs. Intermediate Appellate Court

No. L-66274. September 30, 1984.*

BAGUMBAYAN CORPORATION, petitioner, vs. INTERMEDIATE APPELLATE COURT, LELISA SEÑA and
ARTURO SEÑA, respondents.

Civil Law; Damages; Grant of moral and exemplary damages has no basis if not predicated upon any of
the cases enumerated in the Civil Code.—While the award for actual damages has some basis, the grant
of moral and exemplary damages is devoid of legal justification because it was not predicated upon any
of the cases enumerated in the Civil Code (Ventanilla vs. Centeno, 110 Phil. 811, 816). Generally, there
can be no recovery of moral damages if the case is not mentioned in articles 2219 and 2220 (Malonzo
vs. Galang, 109 Phil. 16; Ventanilla vs. Centeno, 110 Phil. 811).

Same; Same; Moral damages treated in American jurisprudence on compensatory damages.—What we


call moral damages are treated in American jurisprudence as contemporary damages awarded for
mental pain and suffering or mental anguish resulting from a wrong (25 C.J.S. 815).

_______________

* SECOND DIVISION.

442

442

SUPREME COURT REPORTS ANNOTATED

Bagumbayan Corp. vs. Intermediate Appellate Court

Same; Same; Alleged embarrassment by customers due to alleged negligence of a hotel waiter, not the
mental anguish contemplated in Art 2217 of the Civil Code which allows recovery of moral damages.—
We hold that the “embarrassment” to which Mrs. Seña was exposed by the incident is not the mental
anguish contemplated in article 2217 for which moral damages can be recovered.

Same; Same; Exemplary or corrective damages, not recoverable, absent gross negligence; Case at bar.—
In this case, it would not be just and proper to include moral damages in the corporation’s vicarious
liability as employer. The award of P5,000 as exemplary or corrective damages cannot also be sustained
because there was no gross negligence in this case.

ABAD SANTOS, J., concurring:

Civil Law; Damages; Judges and justices of inferior courts enjoined to review the law on damages due to
unwarranted damages awarded by the trial and appellate courts; Case at bar.—Not only did the case go
to trial but the court awarded unwarranted damages and the Intermediate Appellate Court which
should have known better compounded the error. Judges and justices of inferior courts are enjoined to
review the law on damages so that decisions like those rendered by the trial and appellate courts shall
not be repeated.

APPEAL from the decision of the Intermediate Appellate Court.

The facts are stated in the opinion of the Court.

De Santos, Balgos & Perez Law Office for petitioner.

Quiason, Ermitano, Makalintal, & Barot Law Office for respondents.


AQUINO, J.:

This case is about the customer’s claim for moral and exemplary damages due to the alleged negligence
of a waiter. The spouses Lelisa Seña and Arturo Seña and their four children went to the Tropical Palace
Hotel, Parañaque, Metro Manila in the evening of December 20, 1976 to see the Reycard Duet Show.
They occupied a table and ordered drinks before the show started. The hall was crowded and, as anyone
who at-

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VOL. 132, SEPTEMBER 30, 1984

443

Bagumbayan Corp. vs. Intermediate Appellate Court

tended such show can attest, excitement and confusion prevailed (8, 40-41 tsn, January 19, 1978).

Lelisa’s version was that when a waiter named Baez was going to serve them, the tray containing the
drinks was overturned and fell on her. She was drenched. Later, she felt some chill. The drinks and the
splinters from the broken glasses allegedly destroyed her dress which, with her handbag and shoes, cost
one thousand pesos (32-33 tsn November 29, 1977).

She was shocked. She sensed that some persons were laughing at or pitying her. Lawyer Francisco
Gatchalian, who was at the same table, commented that it was one of those unavoidable things (24 tsn
November 29, 1977).

A waitress took Lelisa to the ladies’ room. She had to remove her dress and underwear which were wet.
She was not given any towel to cover herself. She remained standing as there was no chair (27-28 tsn).
Two of her daughters followed her to the ladies’ room (31 tsn). She returned to the hall after about
thirty minutes later when the show had started (28, 51-52 tsn). The lower court erred in concluding that
she missed the show.

Lelisa testified that she was claiming moral damages of P100,000 for herself and her husband due to
embarrassment and the fact that the management did not even offer any apology on that night (34-37
tsn). She was claiming exemplary damages in the same amount to teach the management a lesson. The
husband, Arturo Seña, testified that the incident infuriated him. There was no apology from the
management.

Rudy Tanchanco, the food and beverage manager, was one of three persons in charge of the show. He
testified that the admission was on a “first come, first served” basis. All the waiters were extras
performing under twelve supervisors. In open court, Tanchanco apologized to the plaintiffs in behalf of
the management for the inconvenience caused to them, meaning that the management was sorry for
what happened to Mrs. Seña (38-39 February 27, 1978).

The Señas sued the corporation, as employer of the waiter, for actual damages of P200,000 plus
attorney’s fees of P10,000 and such moral and exemplary damages as might be fixed by
444

444

SUPREME COURT REPORTS ANNOTATED

Bagumbayan Corp. vs. Intermediate Appellate Court

the court. The action involves a quasi-delict. It was based on articles 2176 and 2180 of the Civil Code.

The corporation in its answer alleged that it came to know of the incident only when it was served with
summons. Had the incident been brought to its attention on that same night, it would have apologized
immediately to the plaintiffs, made appropriate amends and taken steps to discipline the waiter and his
supervisor.

In fact, in its answer it apologized to the plaintiffs. It labelled the incident as a fortuitous event. It alleged
that it observed diligentissimi patris-familias to prevent the damage. It reiterated that it was sorry for
what had happened. It manifested its desire to make the proper amends in any reasonable manner or
form.

After hearing, the trial court awarded the Señas P1,540 as actual damages consisting of the value of Mrs.
Seña’s outfit and P540, the cost of the six tickets used by the Seña family which was considered a loss
because of their alleged failure to enjoy the show. It also awarded the Señas P50,000 as moral damages,
P10,000 as exemplary damages and P5,000 as attorney’s fees.

The corporation appealed. The Intermediate Appellate Court affirmed the judgment with the
modification that the moral and exemplary damages were reduced to P15,000 and P5,000, respectively.
Hence, this appeal.

The trial court sensibly noted that court action could have been avoided had the matter been taken up
directly with the corporation before the action was filed. No extrajudicial demand preceded the action.

While the award for actual damages has some basis, the grant of moral and exemplary damages is
devoid of legal justification because it was not predicated upon any of the cases enumerated in the Civil
Code (Ventanilla vs. Centeno, 110 Phil. 811, 816).

The Civil Code provides:

“ART. 2217. Moral damages include physical suffering, mental anguish, fright, serious anxiety,
besmirched reputation, wounded

445

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445

Bagumbayan Corp. vs. Intermediate Appellate Court


feelings, moral shock, social humiliation, and similar injury. Though incapable of pecuniary computation,
moral damages may be recovered if they are the proximate result of the defendant’s wrongful act or
omission.”

“ART. 2219. Moral damages may be recovered in the following and analogous cases:

“(1) A criminal offense resulting in physical injuries;

(2) Quasi-delicts causing physical injuries;

(3) Seduction, abduction, rape, or other lascivious acts;

(4) Adultery or concubinage;

(5) Illegal or arbitrary detention or arrest;

(6) Illegal search;

(7) Libel, slander or any other form of defamation;

(8) Malicious prosecution;

(9) Acts mentioned in article 309;

(10) Acts and actions referred to in articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.

“The parents of the female seduced, abducted, raped, or abused, referred to in No. 3 of this article, may
also recover moral damages.

“The spouse, descendants, ascendants, and brothers and sisters may bring the action mentioned in No.
9 of this article, in the order named.”

“ART. 2220. Willful injury to property may be a legal ground for awarding moral damages if the court
should find that, under the circumstances, such damages are justly due. The same rule applies to
breaches of contract where the defendant acted fraudulently or in bad faith.”

The instant case is not specifically mentioned in article 2219 which refers to quasi-delicts causing
physical injuries. The Appellate Court erred in considering it as analogous to the cases mentioned
therein without indicating what specific case the instant case resembles or is analogous to. For example,
an unfounded complaint with a baseless imputation of forgery is analogous to defamation mentioned in
article 2219(7). It justified an award of P2,000 as moral damages (Justiva vs. Gustilo, 117 Phil. 71).

Generally, there can be no recovery of moral damages if the case is not mentioned in articles 2219 and
2220 (Malonzo vs.

446

446

SUPREME COURT REPORTS ANNOTATED

Bagumbayan Corp. vs. Intermediate Appellate Court


Galang, 109 Phil. 16; Ventanilla vs. Centeno, 110 Phil. 811).

What we call moral damages are treated in American jurisprudence as compensatory damages awarded
for mental pain and suffering or mental anguish resulting from a wrong (25 C.J.S. 815).

“Mental suffering means distress or serious pain as distinguished from annoyance, regret or vexation.
Mental anguish is intense mental suffering.” (Johnson vs. Western Union Telegraph Co., 81 S.C. 235,
238, 62 SE 244, Note 35, 17 C.J. 829.)

“Generally, damages for mental anguish are limited to cases in which there has been a personal physical
injury or where the defendant wilfully, wantonly, recklessly, or intentionally caused the mental anguish”
(22 Am Jur 2nd 275). “Nor will damages generally be awarded for mental anguish which is not
accompanied by a physical injury, at least where maliciousness, wantonness, or intentional conduct is
not involved” (22 Am Jur 2nd 276).

“Damages for mental anguish and suffering have been held recoverable where the act complained of
was done with such gross carelessness or recklessness as to show an utter indifference to the
consequences” (25 C.J.S. 820).

“Under Ohio law, damages for emotional distress consisting of embarrassment and mental suffering and
dire threats, are not recoverable unless intentionally caused” (Parmelee vs. E.A. Ackerman, 252 Fed. 2nd
721).

In Chicago, R.I. & P. Ry. Co. vs. Caple, 179 S.W. 2nd 151, it was held that where the act is wanton or
willful, there may be a recovery for humiliation and mental suffering without any physical injury. It was
further held that in negligence cases, where there is no willful or wanton wrong, there can be no
recovery for mental suffering unless there is also physical injury.

We hold that the “embarrassment” to which Mrs. Seña was exposed by the incident is not the mental
anguish contemplated in article 2217 for which moral damages can be recovered.

447

VOL. 132, SEPTEMBER 30, 1984

447

Bagumbayan Corp. vs. Intermediate Appellate Court

Parenthetically, the case of People vs. Plaza, CA 52 OG 6609, 6612, a case decided by Justice Sanchez,
may be cited. In that case, Genoveva de Soriano was a passenger in a riverboat which was bumped by
another boat manned by Berchman Plaza and caused the first boat to capsize and sink but did not
drown Genoveva. She did not know how to swim. Her life was endangered. She suffered fright and
mental anguish during those moments when her fate was uncertain. Her claim for P500 as moral
damages was not allowed.

In this case, it would not be just and proper to include moral damages in the corporation’s vicarious
liability as employer. The award of P5,000 as exemplary or corrective damages cannot also be sustained
because there was no gross negligence in this case.
WHEREFORE, the decision of the Appellate Court is modified. The petitioner is ordered to pay Lelisa
Seña the sum of P5,000 to cover her actual damages, litigation expenses and attorney’s fees. The award
of moral and exemplary damages is eliminated. No costs.

SO ORDERED.

Makasiar, (Chairman), Escolin and Cuevas, JJ., concur.

Abad Santos, J., see concurring opinion.

Concepcion, Jr., J., did not take part.

Guerrero, J., is on leave.

ABAD SANTOS, J., concurring:

The Seña’s claim for excessive damages could have been amicably settled by the trial judge. The record
does not show whether or not a pre-trial was conducted. But it must be presumed that official duty was
performed, that a pre-trial was held. Why then was not a case like this aborted? Not only did the case go
to trial but the court awarded unwarranted damages and the Intermediate Appellate Court which
should have known better compounded the error. Judges and justices of inferior courts are enjoined to
review the law on damages so that decisions like those rendered by the trial and appellate

448

448

SUPREME COURT REPORTS ANNOTATED

Uy Tong vs. Silva

courts shall not be repeated. With this observation, I concur in the learned ponencia of Mr. Justice
Ramon C. Aquino.

Decision modified.

Notes.—In order that moral damages may be awarded, it is essential that the claimant satisfactorily
prove the existence of the factual basis of the damages and its causal relation to defendant’s acts.
(Raagas vs. Traya, 22 SCRA 839.)

The Civil Code making clear that whoever by act or omission causes damage to another, there being
negligence, is under the obligation to pay for the damage done. Unless it could be satisfactorily shown
that the defendant was guilty of negligence it could not be held liable. (Cortes vs. Manila Railroad
Company, 27 SCRA 674.)

——o0o—— Bagumbayan Corp. vs. Intermediate Appellate Court, 132 SCRA 441, No. L-66274
September 30, 1984
G.R. No. L-39215 September 1, 1989

PHILIPPINE NATIONAL BANK, plaintiff-appellee,


vs.
UTILITY ASSURANCE & SURETY CO., INC., defendant- appellant.

The Chief and Asst. Chief Legal Counsel for plaintiff appellee.

Ceferino M. Carpio, Jr. for defendant-appellant.

RESOLUTION

FELICIANO, J.:

The Kangyo Bank Ltd., Tokyo, Japan, issued Letter of Credit No. 14-10272 in the amount of US$
28,150.00 in favor of the Pedro Bartolome Enterprises of Manila to cover an export shipment of logs
to Japan. The beneficiary of the Letter of Credit assigned its rights to Lanuza Lumber. On 29 March
1960, Procopio Caderao, doing business under the trade name "Lanuza Lumber," obtained a loan of
P 25,000.00 from plaintiff-appellee Philippine National Bank (PNB) as evidenced by a promissory
note on the security, among other things, of the proceeds of the Letter of Credit. The PNB in addition
required Lanuza Lumber to submit a surety bond. Defendant- Appellant Utility Assurance & Surety
Co., Inc. ("Utassco"), accordingly, executed Surety Bond No. B-123 in favor of PNB. It is useful to
quote the terms of the Surety Bond in their entirety:

SURETY BOND

Know All Men By These Presents:

That we, LANUZA LUMBER of Surigao, Surigao (532 Rosario St., Manila) as Principal, and the
UTILITY ASSURANCE & SURETY CO., INC., a corporation duly organized and existing under and
by virtue of the laws of the Philippines, with Head Office in the City of Manila, as Surety, are held
and firmly bound unto PHILIPPINE NATIONAL BANK in the penal sum of TWENTY FIVE
THOUSAND ONLY-PESOS (P 25,000.00) Philippine Currency, for the payment of which, well and
truly to be made, we bind ourselves, our heirs, executors, administrators and successors and
assigns, jointly and severally, firmly by these presents:

The conditions of this obligation are as follows:

Whereas, the Kangyo Bank, Ltd., Tokyo, Japan has granted a letter of credit No. 14-10272 in the
amount of $ 28,150.00 in favor of Pedro Bartolome Enterprises of 302 Salvacion Apt. 2504
Pennsylvania, Manila, to cover shipment of 500,000 board feet of logs to Shin Asshigawa Co., Ltd.,
Tokyo, Japan;

Whereas, on January 21, 1960 the beneficiary, Pedro Bartolome Enterprises assigned the
aforementioned letter of credit to Lanuza Lumber of Surigao per attached Deed of Assignment;

Whereas, the correspondent Bank, Philippine National Bank requires the Lanuza Lumber to post a
surety bond in the sum of Twenty Five Thousand (P 25,000.00) Pesos, Philippine Currency, to
guarantee full and faithful compliance by the beneficiary of the terms and conditions of the said letter
of credit.

It is a special provision of this undertaking to guarantee the full payment of a loan not to exceed
TWENTY FIVE THOUSAND PESOS (P 25,000.00) that may be granted by the Philippine National
Bank to Lanuza Lumber.

Whereas, said contract requires said Principal to give a good and sufficient bond in the above-stated
sum to secure the full and faithful performance on his part of said contract;

Now Therefore, if the Principal shall well and truly perform and fulfill all the undertakings, covenants,
terms, conditions and agreements stipulated in said contract, then this obligation shall be null and
void otherwise to remain in full force and effect.

The liability of the UTILITY ASSURANCE & SURETY CO., INC., on this bond will expire on March
17, 1961 and said bond will be cancelled TEN DAYS after its expiration, unless Surety is notified of
any existing obligations thereunder.

In Witness Whereof, we have set our hands and signed our names at Manila on March 17, 1960.

Utility Assurance & Surety Co., Inc.

S/ Dalmacio Urtula, Jr.

DALMACIO URTULA, JR.

AUTHORIZED SIGNATURE

LANUZA LUMBER

S/ Procopio 0. Caderao

General Manager

SIGNED IN THE PRESENCE OF:

(Sgd) ILLEGIBLE

(Sgd) ILLEGIBLE. (Emphasis supplied)

The surety bond was accompanied by an Endorsement No. B-60-3 which provided as
follows:

In lieu of the last paragraph of this bond, it is hereby declared and agreed that the
following condition be incorporated in said bond and made an integral part thereof :

That, if the above bounden principal and surety shall, in all respects, duly and fully
observe and perform all and singular terms and conditions of the aforementioned
Letter of Credit, then this obligation shall be and become null and of no further force
nor effect; in the contrary case, the same shall continue in full effect and be
enforceable, as a joint and several obligation of the parties hereto in the manner
provided by law so long as the account remains unpaid and outstanding in the books
of the Bank either thru non-collection, extension, renewals or plans of payment with
or without consent of the surety.

It is a special condition of this bond that the liability of the surety thereon shall, at all
times, be enforceable simultaneously with that of the principal without the necessity
of having the assets of the principal resorted to, or exhausted by, the creditor;
Provided, however, that the liability of the surety shall he limited to the sum of
TWENTY-FIVE THOUSAND PESOS (P 25,000), Philippine Currency. Nothing herein
contained shall be held to vary, alter, waive or change any of the terms, limits or
conditions of the bond, except as herein-above set forth. (Emphasis supplied)

The promissory note executed by Lanuza Lumber became due and payable. Neither Lanuza Lumber
nor Utassco paid the loan despite repeated demands by PNB for payment. Accordingly, PNB filed in
the then Court of First Instance of Manila an action to recover the amount of the promissory note
with interest as provided thereon plus attorney's fees. 1

In its Answer to PNB's complaint, Utassco stated that it had "no knowledge or information sufficient
to form a belief as to the truth of the allegations contained in [paragraphs 2, 3, 4 and 5] of the
amended complaint and perforce [denied] the same." 2 At the same time, however, in setting out its
affirmative defense, Utassco admitted that it had executed the surety bond and simultaneously pointed to
the provisions of Endorsement No. B- 60-3. In particular, Utassco contended that its obligation under the
Surety Bond was to secure the performance of all the terms and conditions of the US$ 28,150.00 Letter of
Credit issued by Kangyo Bank Ltd. and had not guaranteed the performance of Lanuza Lumber's
obligation under its P 25,000.00 loan from PNB.

On 14 January 1971, upon motion of PNB, the trial court rendered judgment on the pleadings. The
dispositive part of the judgment reads as follows:

WHEREFORE, in the light of the foregoing considerations, judgment is hereby


rendered ordering the defendant to pay the plaintiff the sum of P 25,000.00 plus 6 %
interest per annum counted from May 19, 1962, the date of the filing of the original
complaint until fully paid, plus attorney's fees equivalent to 10 % of the principal
obligation and the costs of the suit.

Its Motion for Reconsideration of the trial court's judgment on the pleadings having been denied,
Utassco appealed that judgment to the Court of Appeals.

The Court of Appeals, by a Resolution dated 31 July 1974, certified the appeal to us as involving
only questions of law.Both before the Court of Appeals and this Court, Utassco claims that the trial
court fell into error:

(1) in granting the plaintiff-appellee's (PNB's) motion for judgment on the pleadings;

(2) assuming the trial court could render judgment on the pleadings, in doing so
prematurely; and

(3) in awarding interest and attorney's fees in favor of plaintiff-appellee PNB.


We turn to the first alleged error. As noted earlier, Utassco had alleged in its answer that it had no
knowledge or information sufficient to form a belief as to the truth of the allegations made by PNB in
its complaint. Utassco, in other words, purported to deny those allegations and hence now contends
that it had generated an issue of fact which the trial court should have first passed upon. Utassco,
however, cannot be deemed to have denied the allegations of the amended complaint, considering
that the truth of those allegations relating to the execution of the surety bond and the contents
thereof was peculiarly within the knowledge of Utassco being the issuer of the bond and
Endorsement No. B-60-3 itself. In Equitable Banking Corporation v. Liwanag, 3 the Supreme Court
rejected out of hand the same argument which Utassco now seeks to make:

This pretense is manifestly devoid of merit Although the Rules of Court permit a
litigant to file an answer alleging lack of knowledge to form a belief as to the truth of
certain allegations in the complaint, this form of denial 'must be availed of with
sincerity and in good faith, -certainly neither for the purpose of delay.' Indeed, it has
been held that said mode of denial is unavailing 'where the fact as to which want of
knowledge is asserted is to the knowledge of the court so plainly and necessarily
within the defendant's knowledge that his averment of ignorance must be palpably
untrue.' Thus, under conditions almost Identical to those obtaining in the case at bar,
this Court, speaking through Mr. Justice Villamor, upheld a judgment on the
pleadings in Capitol Motors vs. Nemesio L. Yabut (G.R. No. L-28140, March 19,
1970) from which we quote:

We agree with the defendant-appellant that one of the modes of specific denial
contemplated in Section 10, Rule 8, is a denial by stating that the defendant is
without knowledge or information sufficient to form a belief as to the truth of a
material averment in the complaint. The question, however, is whether paragraph 2
of defendant-appellant's answer constitutes a specific denial under the said rule. We
do not think so. In Warner Barnes & Co. Ltd. vs. Reyes, et al. G.R. No. L-9531, May
14,1958 (103 Phil. 662), this Court said that the rule authorizing an answer to the
effect that the defendant has no knowledge or information sufficient to form a belief
as to the truth of an averment and giving such answer the effect of a denial, does not
apply where the fact as to which want of knowledge is asserted, is so plainly and
necessarily within the defendant's knowledge that his averment of ignorance must be
palpably untrue.

In said case the suit was one for foreclosure of mortgage, and a copy of the deed of
mortgage was attached to the complaint: thus, according to this Court, it would have
been easy for the defendants to specifically allege in their answer whether or not
they had executed the alleged mortgage. The same thing can be said in the present
case, where a copy of the promissory note sued upon was attached to the complaint.
The doctrine in Warner Barnes & Co. Ltd. was reiterated in J.P. Juan & Sons, Inc. v.
Lianga Industries, Inc., G.R. No. L-25137, July 28, 1969 (28 SCRA 807) . . . .
(Emphasis supplied)

At the same time that Utassco pretended to have denied the allegations of PNB's amended
complaint, it admitted in the affirmative defense section of its answer that it had indeed executed the
Surety Bond and Endorsement No. B-60-3 in favor of PNB; Utassco must be deemed thereby to
have admitted the due execution of the Bond and the Endorsement. Its affirmative defense in fact
consisted of pleading the very provisions of the Surety Bond upon which PNB based its cause of
action. Thus, the issues raised by the amended complaint and the answer were not genuine issues
of fact on which evidence would have had to be submitted. Those pleadings raised, rather, questions
concerning the proper interpretation of the provisions of the Surety Bond and Endorsement No. B-
60-3, i.e., the determination of whether the surety bond and the endorsement had, as contended by
the PNB, guaranteed the payment by Lanuza Lumber of its P 25,000.00 loan from PNB; or whether,
as maintained by Utassco, the surety bond and its endorsement served merely to secure the
performance of the terms and conditions of the Letter of Credit No. 14-10272. We hold, therefore,
that under these circumstances, the trial court correctly rendered judgment on the pleadings.

We turn to the second error imputed by Utassco to the trial court: that the judgment on the
pleadings, while it may have been within the jurisdiction of the trial court, was prematurely issued.
This argument appears to us even more tenuous than the first assigned error. Utassco claims that
the trial court should have withheld judgment on the pleadings until after the third party action
brought by Utassco against the owner of Lanuza Lumber on the indemnity agreement executed
between them, had gone forward to judgment. The third party complaint could, of course, have been
prosecuted quite separately from the principal action between PNB and Utassco. Indeed, there was
no reason at all why the trial court should have deferred rendering judgment on the pleadings in the
principal action, considering that the PNB was not interested at all in the outcome of the third party
complaint. Under Section 12, Rule 6 of the Revised Rules of Court, the purpose of a third party
complaint is to enable a defending party to obtain contribution, indemnity, subrogation or other relief
from a person not a party to the action, Thus, notwithstanding the judgment on the pleadings,
Utassco could still proceed with the prosecution of its third party complaint.

Before passing on to the third error assigned by Utassco, it is important to note that Utassco did not
really dispute the correctness of the conclusion reached by the trial court in respect of the
substantive issue raised before it: whether the bond issued by Utassco secured the obligations of
Lanuza Lumber to repay the P 25,000.00 loan obtained from PNB, or whether the bond had secured
the Letter of Credit. The trial court held that the surety bond was intended to secure the repayment
of Lanuza Lumber's loan from PNB. We believe and so hold that the trial court was correct in so
holding. In the first place, the surety bond explicitly stated that the P 25,000.00 loan was being
secured by the bond:

It is a special provision of this undertaking to guarantee the full payment of a loan not
to exceed TWENTY FIVE THOUSAND PESOS (P 25,000.00) that may be granted
by the Philippine National Bank to Lanuza Lumber.

In the second place, while the bond and the endorsement had referred to the Letter of Credit,
Lanuza Lumber had no obligations under the Letter of Credit. As noted earlier, Lanuza Lumber was
beneficiary-assignee of the Letter of Credit. Thus, Utassco's view would reduce the terms and
conditions of the Surety Bond to nonsense. Such view would also mean that Utassco, in its own
reading of the bond, was never at risk since there were no obligations to secure and that Utassco
was in fact collecting premiums for issuing the bond under which it had no liabilities. The principle of
effectiveness is basic in contract interpretation: where two (2) interpretations of the same contract
language are possible, one interpretation having the effect of rendering the contract meaningless
(and one of the parties merely dishonest for receiving consideration thereunder without parting with
any), while the other interpretation would give effect to the contract as a whole, the latter
interpretation must be adopted . 4

In the instant case, the reference to the Letter of Credit in the surety bond and the endorsement was
either merely inadvertent surplusage or, alternatively, merely indication of ineptness on the part of
the draftsman of the bond and the endorsement. It is not disputed by Utassco that the endorsement
was intended to replace the final paragraph of the original bond, which paragraph limited the life of
the bond to one year from issuance. The endorsement had the important effect of giving the bond
continuing life so long as "the account" remained unpaid and outstanding on the books of PNB. The
term "account" here could only refer to the account of the principal debtor, Lanuza Lumber, with
PNB. The endorsement also made it clear that the liability of Lanuza Lumber and Utassco was joint
and several in nature, and that Utassco had waived any benefit of excussion that it might otherwise
have had. Finally, on a very practical level, it is difficult to understand how Utassco could have
reasonably supposed that its bond in the amount of RP P 25,000.00 was intended only (or even
principally) to secure performance of the obligations of the issuer-Kangyo Bank-under the Letter of
Credit which had a face value of US$ 28,150.00, many times the face value of the bond.

We come to the final error assigned by Utassco: that the trial court should not have granted interest
and attorney's fees in favor of PNB, considering the clause in the endorsement limiting the liability of
Utassco to P 25,000.00. The issue here presented is not a new one. It was extensively discussed
and Utassco's submission decisively rejected by this Court in Plaridel Surety and Insurance Co.,
Inc. 5 v. P.L. Galang Machinery Co., Inc. There, the Court held:

Petitioner objects to the payment of interest and attorney's fees because: (1) they
were not mentioned in the bond; and (2) the surety would become liable for more
than the amount stated in the contract of suretyship.

In support of its objection petitioner dwells on the proposition that a surety's liability
can not be extended beyond the terms of his undertaking, citing articles 1956 and
2208 of the New Civil Code which provide as follows:

ART. 1956. No interest shall be due unless it has been expressly stipulated in
writing.

ART. 2208. In the absence of stipulation, attorney's fees and expenses of litigation,
other than judicial costs, cannot be recovered, except: . . . .

The objection has to be overruled, because as far back as the year 1922 this Court
held in Tagawa vs. Aldanese, 43 Phil. 852, that creditors suing on a suretyship bond
may recover from the surety as part of their damages, interest at the legal rate even
if the surety would thereby become liable to pay more than the total amount
stipulated in the bond. 'The theory is that interest is allowed only by way of damages
for delay upon the part of the sureties in making payment after they should have
done. In some states, the interest has been charged from the date of the judgment of
the appellate court. In this jurisdiction, we rather prefer to follow the general practice
which is to order that interest begin to run from the date when the complaint was filed
in court, . . . . '

Such theory aligned with Sec. 510 of the Code of Civil Procedure which was
subsequently recognized in the Rules of Court (Rule 53, Section 6) and with Article
11- 08 of the Civil Code (now Art. 2209 of the New Civil Code).

In other words the surety is made to pay interest, not by reason of the contract, but
by reason of its failure to pay when demanded and for having compelled the plaintiff
to resort to the courts to obtain payment. It should be observed that interest does not
run from the time the obligation became due, but from the filing of the complaint.

As to attorney's fees. Before the enactment of the New Civil Code, successful
litigants could not recover attorney's fees as part of the damages they suffered by
reason of the litigation. Even if the party paid thousands of pesos to his lawyers, he
could not charge the amount to his opponent.
However, the New Civil Code permits recovery of attorney's fees in eleven cases
enumerated in Article 2208, among them 'where the court deem it just and equitable
that attorney's fees and expenses of litigation should be recovered' or 'when the
defendant acted in gross and evident bad faith in refusing to satisfy the plaintiffs
plainly valid, just and demandable claim.' This gives the courts discretion in
apportioning attorney's fees.

Now, considering, in this case, that the principal debtor had openly and expressly
admitted his liability under the bond, and the surety knew it (p.123 R.A.) we can not
say there was abuse of lower court's discretion in the way of awarding fees, specially
when the indemnity agreement . . . afforded the surety adequate protection. (100
Phil. 681-682. (Emphasis supplied)

WHEREFORE, the Court Resolved to DISMISS the appeal by defendant-appellant Utility Assurance
& Surety Co., Inc. for lack of merit, and to AFFIRM the judgment of the trial court dated 14 January
1971. No pronouncement as to costs. This Resolution is immediately executory. SO ORDERED.

Fernan, C.J., Gutierrez, Jr., Bidin and Cortes, JJ., concur.

356

SUPREME COURT REPORTS ANNOTATED

Crismina Garments, Inc. vs. Court of Appeals

G.R. No. 128721. March 9, 1999.*

CRISMINA GARMENTS, INC., petitioner, vs. COURT OF APPEALS and NORMA SIAPNO, respondents.

Civil Law; Interest; Instances where the interest rate under CB Circular No. 416 applies; Cases beyond
the scope of the said circular are governed by Article 2209 of the Civil Code which considers inter-

________________

* THIRD DIVISION.

357

VOL. 304, MARCH 9, 1999

357

Crismina Garments, Inc. vs. Court of Appeals

est a form of indemnity for the delay in the performance of an obligation.—In Reformina v. Tomol, Jr.,
this Court stressed that the interest rate under CB Circular No. 416 applies to (1) loans; (2) forbearance
of money, goods or credits; or (3) a judgment involving a loan or forbearance of money, goods or
credits. Cases beyond the scope of the said circular are governed by Article 2209 of the Civil Code, which
considers interest a form of indemnity for the delay in the performance of an obligation.
Same; Same; Same; The monetary award shall earn interest at twelve percent (12%) per annum from
the date of the finality of the judgment until its satisfaction, regardless of whether or not the case
involves a loan or forbearance of money.—In Keng Hua Paper Products Co., Inc. v. CA, we also ruled that
the monetary award shall earn interest at twelve percent (12%) per annum from the date of the finality
of the judgment until its satisfaction, regardless of whether or not the case involves a loan or
forbearance of money. The interim period is deemed to be equivalent to a forbearance of credit.

Same; Same; Same; In Eastern Shipping, the Court observed that a “forbearance” in the context of the
usury law is a “contractual obligation of lender or creditor to refrain, during a given period of time, from
requiring the borrower or debtor to repay a loan or debt then due and payable.”—Private respondent
maintains that the twelve percent (12%) interest should be imposed, because the obligation arose from
a forbearance of money. This is erroneous. In Eastern Shipping, the Court observed that a “forbearance”
in the context of the usury law is a “contractual obligation of lender or creditor to refrain, during a given
period of time, from requiring the borrower or debtor to repay a loan or debt then due and payable.”
Using this standard, the obligation in this case was obviously not a forbearance of money, goods or
credit.

PETITION for review on certiorari of a decision of the Court of Appeals.

The facts are stated in the opinion of the Court.

H.D. Tumaneng & Associates for petitioner.

Punzalan and Associates Law Office for private respondent.

358

358

SUPREME COURT REPORTS ANNOTATED

Crismina Garments, Inc. vs. Court of Appeals

PANGANIBAN, J.:

Interest shall be computed in accordance with the stipulation of the parties. In the absence of such
agreement, the rate shall be twelve percent (12%) per annum when the obligation arises out of a loan or
a forbearance of money, goods or credits. In other cases, it shall be six percent (6%).

The Case

On May 5, 1997, Crismina Garments, Inc. filed a Petition for Review on Certiorari1 assailing the
December 28, 1995 Decision2 and March 17, 1997 Resolution3 of the Court of Appeals in CA-GR CV No.
28973. On September 24, 1997, this Court issued a minute Resolution4 denying the petition “for its
failure to show any reversible error on the part of the Court of Appeals.”
Petitioner then filed a Motion for Reconsideration,5 arguing that the interest rate should be computed
at 6 percent per annum as provided under Article 2209 of the Civil Code, not 12 percent per annum as
prescribed under Circular No. 416 of the Central Bank of the Philippines. Acting on the Motion, the Court
reinstated6 the Petition, but only with respect to the issue of which interest rate should be applied.7

__________________

1 Rollo, pp. 7-21.

2 Penned by Justice Romeo J. Callejo, Sr.; with the concurrence of J. Antonio M. Martinez, Division
chairman (now a retired member of this Court), and Pacita Cañizares-Nye, member.

3 Also penned by Justice Callejo, Sr. with JJ. Antonio M. Martinez, Division chairman, and Ruben T.
Reyes, member, both concurring.

4 Rollo, pp. 104-105.

5 Ibid., pp. 106-112.

6 Resolution dated April 27, 1998; rollo, p. 118.

7 Rollo, pp. 140-141.

359

VOL. 304, MARCH 9, 1999

359

Crismina Garments, Inc. vs. Court of Appeals

The Facts

As the facts of the case are no longer disputed, we are reproducing hereunder the findings of the
appellate court:

“During the period from February 1979 to April 1979, the [herein petitioner], which was engaged in the
export of girls’ denim pants, contracted the services of the [respondent], the sole proprietress of the
D’Wilmar Garments, for the sewing of 20,762 pieces of assorted girls[’] denims supplied by the
[petitioner] under Purchase Orders Nos. 1404, dated February 15, 1979, 0430 dated February 1, 1979,
1453 dated April 30, 1979. The [petitioner] was obliged to pay the [respondent], for her services, in the
total amount of P76,410.00. The [respondent] sew[ed] the materials and delivered the same to the
[petitioner] which acknowledged the same per Delivery Receipt Nos. 0030, dated February 9, 1979;
0032, dated February 15, 1979; 0033, dated February 21, 1979; 0034, dated February 24, 1979; 0036,
dated February 20, 1979; 0038, dated March 11, 1979[;] 0039, dated March 24, 1979; 0040, dated
March 27, 1979; 0041, dated March 29, 1979; 0044, dated Marc[h] 25, 1979; 0101, dated May 18,
1979[;] 0037, dated March 10, 1979 and 0042, dated March 10, 1979, in good order condition. At first,
the [respondent] was told that the sewing of some of the pants w[as] defective. She offered to take
delivery of the defective pants. However, she was later told by [petitioner]’s representative that the
goods were already good. She was told to just return for her check of P76,410.00. However, the
[petitioner] failed to pay her the aforesaid amount. This prompted her to hire the services of counsel
who, on November 12, 1979, wrote a letter to the [petitioner] demanding payment of the aforesaid
amount within ten (10) days from receipt thereof. On February 7, 1990, the [petitioner]’s [v]ice-
[p]resident-[c]omptroller, wrote a letter to [respondent]’s counsel, averring, inter alia, that the pairs of
jeans sewn by her, numbering 6,164 pairs, were defective and that she was liable to the [petitioner] for
the amount of P49,925.51 which was the value of the damaged pairs of denim pants and demanded
refund of the aforesaid amount.

“On January 8, 1981, the [respondent] filed her complaint against the [petitioner] with the [trial court]
for the collection of the principal amount of P76,410.00.

xxx

xxx xxx xxx

360

360

SUPREME COURT REPORTS ANNOTATED

Crismina Garments, Inc. vs. Court of Appeals

“After due proceedings, the [trial court] rendered judgment, on February 28, 1989, in favor of the
[respondent] against the [petitioner], the dispositive portion of which reads as follows:

‘WHEREFORE, judgment is hereby rendered in favor of the plaintiff and against the defendant ordering
the latter to pay the former:

(1) The sum of P76,140.00 with interest thereon at 12% per annum, to be counted from the filing of this
complaint on January 8, 1981, until fully paid;

(2) The sum of P5,000 as attorney[’]s fees; and

(3) The costs of this suit;

(4) Defendant’s counterclaim is hereby dismissed.’ ”8

The Court of Appeals (CA) affirmed the trial court’s ruling, except for the award of attorney’s fees which
was deleted.9 Subsequently, the CA denied the Motion for Reconsideration.10

Hence, this recourse to this Court.11

Sole Issue

In light of the Court’s Resolution dated April 27, 1998, petitioner submits for our consideration this sole
issue:
“Whether or not it is proper to impose interest at the rate of twelve percent (12%) per annum for an
obligation that does not involve a loan or forbearance of money in the absence of stipulation of the
parties.”12

________________

8 CA Decision, pp. 1-4; rollo, pp. 25-28 (citations omitted).

9 Ibid., p. 8; rollo, p. 31.

10 Rollo, p. 33.

11 The case was deemed submitted for resolution on December 17, 1998, when this Court received
private respondent’s Memorandum.

12 Petitioner’s Memorandum, p. 2; rollo, p. 160.

361

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361

Crismina Garments, Inc. vs. Court of Appeals

This Court’s Ruling

We sustain petitioner’s contention that the interest rate should be computed at six percent (6%) per
annum.

Sole Issue: Interest Rate

The controversy revolves around petitioner’s payment of the price beyond the period prescribed in a
contract for a piece of work. Article 1589 of the Civil Code provides that “[t]he vendee [herein
petitioner] shall owe interest for the period between the delivery of the thing and the payment of the
price x x x should he be in default, from the time of judicial or extrajudicial demand for the payment of
the price.” The only issue now is the applicable rate of interest for the late payment.

Because the case before us is “an action for the enforcement of an obligation for payment of money
arising from a contract for a piece of work,”13 petitioner submits that the interest rate should be six
percent (6%), pursuant to Article 2209 of the Civil Code, which states:

“If the obligation consists in the payment of money and the debtor incurs in delay, the indemnity for
damages, there being no stipulation to the contrary, shall be the payment of the interest agreed upon,
and in the absence of stipulation, the legal interest, which is six percent per annum.” (Emphasis
supplied.)

On the other hand, private respondent maintains that the interest rate should be twelve percent (12%)
per annum, in accordance with Central Bank (CB) Circular No. 416, which reads:
“By virtue of the authority granted to it under Section 1 of Act No. 2655, as amended, otherwise known
as the ‘Usury Law,’ the Monetary Board, in its Resolution No. 1622 dated July 29, 1974, has prescribed
that the rate of interest for the loan or forbearance of any

_________________

13 Ibid., p. 3; rollo, p. 161.

362

362

SUPREME COURT REPORTS ANNOTATED

Crismina Garments, Inc. vs. Court of Appeals

money, goods or credits and the rate allowed in judgments, in the absence of express contract as to
such rate of interest, shall be twelve per cent (12%) per annum.” (Emphasis supplied.)

She argues that the circular applies, since “the money sought to be recovered by her is in the form of
forbearance.”14

We agree with the petitioner. In Reformina v. Tomol, Jr.,15 this Court stressed that the interest rate
under CB Circular No. 416 applies to (1) loans; (2) forbearance of money, goods or credits; or (3) a
judgment involving a loan or forbearance of money, goods or credits. Cases beyond the scope of the
said circular are governed by Article 2209 of the Civil Code,16 which considers interest a form of
indemnity for the delay in the performance of an obligation.17

In Eastern Shipping Lines, Inc. v. Court of Appeals,18 the Court gave the following guidelines for the
application of the proper interest rates:

“I. When an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts or quasi-
delicts is breached, the contravenor can be held liable for damages. The provisions under Title

_______________

14 Memorandum for Private Respondent, p. 8; rollo, p. 175.

15 139 SCRA 260, October 11, 1985, per Cuevas, J. See also Philippine Rabbit Bus Lines, Inc. v. Cruz, 143
SCRA 158, 160-161, July 28, 1986; and Pilipinas Bank v. Court of Appeals, 225 SCRA 268, 275, August 12,
1993.

16 National Power Corporation v. Angas, 208 SCRA 542, 546-549, May 8, 1992; Tio Khe Chio v. Court of
Appeals, 202 SCRA 119, 123-124, September 30, 1991; Philippine Virginia Tobacco Administration v.
Tensuan, 188 SCRA 628, 632-633, August 20, 1990; Central Azucarera de Bais v. Court of Appeals, 188
SCRA 328, 338-339, August 3, 1990; Meridian Assurance Corporation v. Dayrit, 184 SCRA 20, 23-24, April
3, 1990; and GSIS v. Court of Appeals, 145 SCRA 311, 321, October 30, 1986.

17 Castelo v. Court of Appeals, 244 SCRA 180, 190, May 22, 1995 and Pacific Mills, Inc. v. Court of
Appeals, 206 SCRA 317, 326, February 17, 1992.

18 234 SCRA 78, 95-97, July 12, 1994, per Vitug, J.

363

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363

Crismina Garments, Inc. vs. Court of Appeals

XVIII on ‘Damages’ of the Civil Code govern in determining the measure of recoverable damages.

II. With regard particularly to an award of interest in the concept of actual and compensatory damages,
the rate of interest, as well as the accrual thereof, is imposed, as follows:

1. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or
forbearance of money, the interest due should be that which may have been stipulated in writing.
Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In
the absence of stipulation, the rate of interest shall be 12% per annum to be computed from default,
i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil
Code.

“2.When an obligation, not constituting a loan or forbearance of money, is breached, an interest on the
amount of damages awarded may be imposed at the discretion of the court at the rate of 6% per
annum. No interest, however, shall be adjudged on unliquidated claims or damages except when or until
the demand can be established with reasonable certainty. Accordingly, where the demand is established
with reasonable certainty, the interest shall begin to run from the time the claim is made judicially or
extrajudicially (Art. 1169, Civil Code) but when such certainty cannot be so reasonably established at the
time the demand is made, the interest shall begin to run only from the date the judgment of the court is
made (at which time the quantification of damages may be deemed to have been reasonably
ascertained). The actual base for the computation of legal interest shall, in any case, be x x x the amount
finally adjudged.

“3. When the judgment of the court awarding a sum of money becomes final and executory, the rate of
legal interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 12% per annum
from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a
forbearance of credit.”19

_______________
19 A. C. Enterprises, Inc. v. Construction Industry Arbitration Commission, 244 SCRA 55, 57-58, May 9,
1995, per Quiason, J.

364

364

SUPREME COURT REPORTS ANNOTATED

Crismina Garments, Inc. vs. Court of Appeals

In Keng Hua Paper Products Co., Inc. v. CA,20 we also ruled that the monetary award shall earn interest
at twelve percent (12%) per annum from the date of the finality of the judgment until its satisfaction,
regardless of whether or not the case involves a loan or forbearance of money. The interim period is
deemed to be equivalent to a forbearance of credit.21

Because the amount due in this case arose from a contract for a piece of work, not from a loan or
forbearance of money, the legal interest of six percent (6%) per annum should be applied. Furthermore,
since the amount of the demand could be established with certainty when the Complaint was filed, the
six percent (6%) interest should be computed from the filing of the said Complaint. But after the
judgment becomes final and executory until the obligation is satisfied, the interest should be reckoned
at twelve percent (12%) per year.

Private respondent maintains that the twelve percent (12%) interest should be imposed, because the
obligation arose from a forbearance of money.22 This is erroneous. In Eastern Shipping,23 the Court
observed that a “forbearance” in the context of the usury law is a “contractual obligation of lender or
creditor to refrain, during a given period of time, from requiring the borrower or debtor to repay a loan
or debt then due and payable.” Using this standard, the obligation in this case was obviously not a
forbearance of money, goods or credit.

WHEREFORE, the appealed Decision is MODIFIED. The rate of interest shall be six percent (6%) per
annum, computed from the time of the filing of the Complaint in the trial court until the finality of the
judgment. If the adjudged principal and the interest (or any part thereof) remain unpaid thereaf-

________________

20 GR No. 116863, February 12, 1998, per Panganiban, J.

21 Philippine National Bank v. Court of Appeals, 263 SCRA 766, 770-772, October 30, 1996; and Food
Terminal, Inc. v. Court of Appeals, 262 SCRA 339, 343-344, September 23, 1996.

22 Private respondent’s Memorandum, p. 8; rollo, p. 175.

23 Supra, at p. 94.

365
VOL. 304, MARCH 10, 1999

365

Francisco vs. Leyva

ter, the interest rate shall be twelve percent (12%) per annum computed from the time the judgment
becomes final and executory until it is fully satisfied. No pronouncement as to costs.

SO ORDERED.

Romero (Chairman), Vitug, Purisima and Gonzaga-Reyes, JJ., concur.

Judgment modified.

Note.—In the absence of a stipulation as to interest, the loan due will now earn interest at the legal rate
of 12% per annum. (Sulit vs. Court of Appeals, 268 SCRA 441 [1997])

——o0o—— Crismina Garments, Inc. vs. Court of Appeals, 304 SCRA 356, G.R. No. 128721 March 9,
1999

VOL. 318, NOVEMBER 19, 1999

615

People vs. Basco

G.R. No. 129732. November 19, 1999.*

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. MARIO BASCO y SALAO, accused-appellant.

Criminal Law; Murder; Treachery; The location and presence of several gunshot wounds on the body of
the victim is physical evidence that eloquently refutes accused-appellant’s allegation of accidental
firing.—We agree with the trial court that if indeed accused-appellant and the deceased grappled for
the possession of the gun, and the gun fell and accidentally fired, it is impossible that the deceased
would sustain three gunshot wounds. The location and presence of several gunshot wounds on the body
of the victim is physical evidence that eloquently refutes accused-appellant’s allegation of accidental
firing.

Same; Same; Same; Under Article 14, paragraph 16 of the Revised Penal Code, there is treachery when
the offender commits any of the crimes against persons, employing means, methods, or forms in the
execution thereof which tend directly and specifically to insure its execution without risk to himself
arising from the defense which the offended party might make.—Under Article 14, paragraph 16 of the
Revised Penal Code, there is treachery when the offender commits any of the crimes against persons,
employing means, methods, or forms in the execution thereof which tend directly and specifically to
insure its execution without risk to himself arising from the defense which the offended party might
make. “For treachery to be appreciated as a qualifying circumstance, two elements must concur: (1) the
employment of means of execution which gives the person attacked no opportunity to defend himself
or retaliate; and (2) the means of execution is deliberately or consciously adopted.” Both elements
attended the commission of the killing of Rolando Buenaventura, Sr.

Same; Same; Same; Damages; Civil Indemnity; Civil indemnity ex delicto can be awarded without need
of further proof other than the commission of the felony itself, while actual or compensatory damages
to be recoverable must be additionally established with reasonable degree of certainty.—As to the
award of damages, we believe that the two species of damages (actual or compensatory and civil

_______________

* FIRST DIVISION.

616

616

SUPREME COURT REPORTS ANNOTATED

People vs. Basco

indemnity) differ basically in that civil indemnity ex delicto can be awarded without need of further
proof other than the commission of the felony itself, while actual or compensatory damages to be
recoverable must be additionally established with reasonable degree of certainty.

APPEAL from a decision of the Regional Trial Court of Manila, Br. 23.

The facts are stated in the opinion of the Court.

The Solicitor General for plaintiff-appellee.

Public Attorney’s Office for accused-appellant.

PARDO, J.:

The admixture of liquor, hot heads and insignificant discussion were the dangerous concoction that led
to the death of Rolando Buenaventura, Sr.

On September 16, 1993, Assistant City Prosecutor Carmelita S. Gutierrez-Fruelda filed with the Regional
Trial Court, Branch 23, Manila, an information against accused Mario Basco y Salao, as follows:

“That on or about May 3, 1992 in the City of Manila, Philippines, the said accused did then and there
wilfully, unlawfully and feloniously, with intent to kill and with evident premeditation and treachery,
attack, assault and use personal violence upon one ROLANDO BUENAVENTURA, SR. by then and there
shooting the latter with a gun on the different parts of his body, thereby inflicting upon him mortal
gunshot wounds which were the direct and immediate cause of his death thereafter.
“Contrary to law.

“(s/t) CARMELITA S. GUTIERREZ-FRUELDA

“Assistant City Prosecutor”1

_______________

1 Rollo, p. 8.

617

VOL. 318, NOVEMBER 19, 1999

617

People vs. Basco

Upon arraignment on October 7, 1993, accused-appellant entered a plea of not guilty.2 Accordingly, trial
was had. The facts are those duly established through the testimony of Ednalyn Buenaventura, daughter
of the deceased, as follows:

At around 8:00 in the evening of May 3, 1992, Rolando Buenaventura, Sr. was having a drinking spree
with several men outside his home, at Cabangis, Tondo, Manila. Accused-appellant Mario Basco was
with the group drinking beer. Emy, a cousin of the deceased arrived from work. Mang Lando, one of the
men in the group invited Emy to have a drink, but he refused and told them that he would drink later on.
Emy, however, noticed that accused-appellant Mario Basco was playing with a “balisong,” so he warned
the latter about it and told him to put it away because it was “nakakailang.” Mario who was obviously a
bit intoxicated retorted and said “Pare, gusto mo ba talaga ng biruan” and immediately approached Emy
and poked the knife at the latter’s neck. Because of the sudden approach of accused-appellant and the
slippery pavement, Mario slipped and Emy avoided the knife.3

At this instance, the deceased Rolando Buenaventura, Sr. asked his other cousin Edong to help Emy, who
was being attacked by accused-appellant. Edong then got a chair and was about to strike Mario when
Mario’s wife arrived and pacified them. Mario, however, continued wielding the knife and accidentally
hit Rolly, a son of Rolando Buenaventura, Sr. Seeing that his son was seriously injured, Rolando
Buenaventura, Sr. became angry and he cursed accused-appellant. A heated exchange ensued.4

At the height of the argument between the two, Jaime Macanas, a neighbor who was a policeman, came
out of his house, just in front of the house of the Buenaventuras and

_______________

2 RTC Record, p. 60.

3 TSN, February 3, 1994, pp. 3-5.


4 Ibid., p. 6.

618

618

SUPREME COURT REPORTS ANNOTATED

People vs. Basco

fired two shots in the air to pacify the men. Then, Mario’s wife brought him home. Rolando
Buenaventura, Sr. and Emy were left outside the house, but not for long, because Emy went inside the
house to sleep.5

Rolando Buenaventura, Sr. on the other hand was called by Ednalyn, his daughter and Rolly, his son, to
go inside the house and eat supper. When they were about to eat, accused-appellant Mario Basco came
calling and cursing Rolando Buenaventura, Sr. Suddenly, accused-appellant was at the door of the
Buenaventura house and when Rolando stood up to drink water, accused-appellant immediately shot
him, causing him to fall to the ground. Accused-appellant fired another shot at Rolando, then he went
nearer and again shot Rolando at close range, hitting him on the chest.6 He died on the spot. In the
autopsy report, the medico-legal examiner found the following:

“EXTERNAL FINDINGS:

“1. Gunshot wound, thru and thru, with the following entry and exit:

“Point of Entry—at the left temporal region, in front of left ear, circular in shape, 60 inches from heel,
13.5 cms. from anterior midline, measuring 0.3 x 0.3 cms. and contusion collar measures 0.7 x 0.6 cms.
and

“Point of Exit—at the right parieto-occipital region, stellate in shape, 64 1/2 inches from heel, 3 cms.
from posterior midline, measuring 2.2 x 1.3 cms.

“Trajectory—obliquely upward, backward crossing the midline, (from left to right), lacerating the left
temporal lobe then crossed the midline then lacerating the parieto-occipital lobes of the right side of the
brain. There was tunnel formation along its course filled with blood clots and some bone fragments.

“2. Gunshot wound, with the point of entry at the left mandible, oval in shape, 57 inches from heel, 4
cms. from anterior midline, measuring 1.2 x 0.5 cms. and contusion collar measures 1.8 x 1 cms.

_______________

5 Ibid., p. 7.

6 Ibid., pp. 7-9.

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People vs. Basco

“Trajectory—slightly downward, backward towards midline, fracturing the left mandible on entry,
lacerating the muscles of the left jaw, floor of the mouth and the left epiglottis. A deformed slug was
extracted in the body of the 2nd cervical vertebra.

“3. Gunshot wound, thru and thru, with the following point of entry and exit:

“Point of entry—right upper anterior thorax, below the right collar bone, 52 inches from heel, 2.5 cms.
from anterior midline measuring 0.4 x 0.3 cm. and contusion collar measures 0.7 x 0.9 cms. and
tattooing measures 5 x 3 cms.

“Point of Exit—at the right upper posterior thorax, just below the right shoulder blade, 51 inches from
heel, 17 cms. from posterior midline, and measuring 1.5 x 1 cms.

“Trajectory—directed obliquely downward, backward towards right lateral, making a thru and thru
laceration in the upper lobe of the right lung, then fracturing the inferior border of the right scapula
before it exited.

“INTERNAL FINDINGS:

“1. Lacerations of organs and tissues as indicated in the internal extensions of the gunshot wounds with
fractures of the left temporal and right occipital bones. There was severe bleeding intracranially. About
1000 cc. of blood was extracted in the right thoracic cavity. The rest of the internal organs were pale.

“2. Recovered from the stomach about 1/2 glassful of partially digested vegetables and with alcoholic
odor.

“CAUSE OF DEATH: MULTIPLE (3) Gunshot Wounds.7

The defense, however, had a different version of the events that transpired on that fateful day.
According to accused-appellant, it is true that they were having a drinking spree in front of the house of
Rolando Buenaventura, Sr. However, he was not the aggressor. His version of the story is that, “In the
course of the drinking spree, he had an argument with Emy, a cousin of the deceased. Their altercation
angered Rolando Buenaventura, Sr. which resulted in a heated argument be-

_______________

7 RTC Record, Exhibit “C,” Post Mortem Findings, p. 8.

620
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SUPREME COURT REPORTS ANNOTATED

People vs. Basco

tween them. They were pacified by Jaime Macanas and he went home to avoid further altercation with
Rolando Buenaventura, Sr. However, realizing that he was at fault, he went to Rolando’s house
intending to apologize. When he was at the doorstep of the house, Rolando emerged pointing a gun at
him. Fearing that Rolando might shoot him, he grappled for possession of the gun, and suddenly the gun
fell and went off, after which he left immediately.8

On July 19, 1996, after consideration of the evidence of both parties, the trial court found accused guilty
as charged and rendered decision sentencing him to suffer the penalty of reclusion perpetua and to pay
the heirs of the deceased the amount of P50,000.00 for his death; P100,000.00 as loss of income for his
family; P18,000.00 for burial expenses; P1,500.00 spent during the wake and P5,000.00 for the burial
lot.9

Hence, this appeal.

The accused-appellant alleged that the trial court erred:

1. In failing to appreciate the attendant privileged mitigating circumstance of incomplete self-defense;

2. In ordering accused-appellant to pay for burial expenses and in imposing the penalty of reclusion
perpetua; and

3. In finding that evident premeditation qualified the killing of Rolando Buenaventura, Sr. to murder.10

We find the appeal without merit.

First, it is an established fact that the deceased Rolando Buenaventura, Sr. sustained three gunshot
wounds, as evidenced by the post mortem findings.

We agree with the trial court that if indeed accused-appellant and the deceased grappled for the
possession of the

_______________

8 TSN, August 10, 1994, pp. 4-11.

9 RTC Record, Decision, pp. 186-193, at p. 193, Judge William M. Bayhon, presiding.

10 Brief for Accused-Appellant, Rollo, p. 43.

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People vs. Basco

gun, and the gun fell and accidentally fired, it is impossible that the deceased would sustain three
gunshot wounds. The location and presence of several gunshot wounds on the body of the victim is
physical evidence that eloquently refutes accused-appellant’s allegation of accidental firing.11

Second, Ednalyn Buenaventura, a daughter of the deceased, testified in a more credible manner than
accused-appellant and witness Antonio Galvez for the defense, who conveniently stated that accused-
appellant was unarmed when they met on the way to the house of deceased Rolando Buenaventura, Sr.
The testimony of Ednalyn was clear and convincing, complete with details that jibed with the medico
legal findings and testimony of other witnesses. We have held in many cases that “It is not to be lightly
supposed that the relatives of the deceased would callously violate their conscience to avenge the death
of a dear one by blaming it on persons whom they know to be innocent thereof.”12

Third, the trial court did not err when it found accused-appellant guilty of murder. Although evident
premeditation could not be appreciated as attending the commission of the crime, it was evident that
accused-appellant was motivated to commit murder when he went to the house of Rolando
Buenaventura, Sr. When accused-appellant shot Rolando Buenaventura, Sr. the latter was eating supper
with his children; he was unsuspecting and unaware of the intent of the accused. Accused-appellant,
without a word suddenly shot the deceased, and almost immediately after the first shot, fired a second
shot hitting the victim on the chest. Not satisfied and obviously to make sure that the victim was dead,
accused-

_______________

11 People vs. Mangahas, G.R. No. 118777, July 28, 1999, 311 SCRA 384, citing People vs. Amaro, 235
SCRA 8 (1994) and People vs. Guarin, 259 SCRA 95 (1996); see also, People vs. Gregorio, 255 SCRA 380
(1996); People vs. Lopez, 245 SCRA 95 (1995); People vs. Anciro, 228 SCRA 629 (1993); People vs.
Martinado, 214 SCRA 712 (1992).

12 People vs. Dianos, 297 SCRA 191 (1998); People vs. Crisostomo, 293 SCRA 65, 73 (1998), citing People
vs. Libed, 14 SCRA 410 (1965); see also People vs. Galapin, 293 SCRA 474 (1998).

622

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SUPREME COURT REPORTS ANNOTATED

People vs. Basco

appellant approached and shot him at close range directly on the chest causing the bullet to pass thru
and thru the body of the victim. This is a clear case of treachery employed by accused-appellant to
ensure the accomplishment of his intent to kill Rolando Buenaventura, Sr.
Under Article 14, paragraph 16 of the Revised Penal Code, there is treachery when the offender
commits any of the crimes against persons, employing means, methods, or forms in the execution
thereof which tend directly and specifically to insure its execution without risk to himself arising from
the defense which the offended party might make. “For treachery to be appreciated as a qualifying
circumstance, two elements must concur: (1) the employment of means of execution which gives the
person attacked no opportunity to defend himself or retaliate; and (2) the means of execution is
deliberately or consciously adopted.”13 Both elements attended the commission of the killing of
Rolando Buenaventura, Sr.

Finally, as to the award of damages, we believe that the two species of damages (actual or
compensatory and civil indemnity) differ basically in that civil indemnity ex delicto can be awarded
without need of further proof other than the commission of the felony itself, while actual or
compensatory damages to be recoverable must be additionally established with reasonable degree of
certainty.14

WHEREFORE, the decision appealed from is AFFIRMED with the modification that the award for loss of
income in the amount of P100,000.00 is deleted.

Costs against accused-appellant.

SO ORDERED.

Davide, Jr. (C.J., Chairman), Puno, Kapunan and Ynares-Santiago, JJ., concur.

_______________

13 People vs. Mangahas, supra; People vs. Silvestre, G.R. No. 127573, May 12, 1999, 307 SCRA 68;
People vs. Dorado, G.R. No. 122248, February 11, 1999, 303 SCRA 61.

14 People vs. Dianos, supra, on p. 212.

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623

Wallem Maritime Services, Inc. vs. NLRC

Appealed decision affirmed with modification.

Note.—The essence of treachery is the sudden and unexpected attack by an aggressor on an


unsuspecting victim, depriving the latter of any real chance to defend himself and thereby ensuring its
commission without risk to himself. (People vs. Reyes, 287 SCRA 229 [1998])

——o0o—— People vs. Basco, 318 SCRA 615, G.R. No. 129732 November 19, 1999

468
SUPREME COURT REPORTS ANNOTATED

People vs. Salonga

G.R. No. 128647. March 31, 2000.*

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. ANTONIO “TONY” SALONGA, ALFREDO “FRED”
DANGANAN AND EDUARDO “EDDIE” DANGANAN, defendantsappellants.

Criminal Law; Witnesses; Judicial Notice; The Supreme Court takes judicial notice of some people’s
reluctance to be involved in criminal trials; Failure to volunteer what one knows to law enforcement
officials does not necessarily impair a witness’ credibility.—Accused-appellants insist that the testimony
of Maximo Tabag is contrary to human nature or ordinary course of things because he never helped the
victim; never reported it to the relatives or barangay officials of Sinait; and he never went to the place
where the victim was dragged despite opportunity to do the same. Tabag did not attempt to go to the
place where the victim was dragged nor immediately report to the authorities the horrifying experience
he had witnessed because he was afraid that accused-appellants will harm him had they known that he
was the one who saw them. Besides, there is no standard form of the human behavioral response to a
startling or frightful experience and the delay in bringing up the matter to the authorities do not destroy
the veracity and credibility of the testimony offered. The court takes judicial notice of some people’s
reluctance to be involved in criminal trials. Failure to volunteer what one knows to law enforcement
officials does not necessarily impair a witness’ credibility.

Same; Same; Settled is the rule that the trial court’s assessment of the credibility of witnesses is
accorded great respect because it heard the witnesses and observed their behavior and manner of
testifying—the proximate contact of the trial court with those who take the witness stand places them
in a more competent position to discriminate between a true and false testimony.—In fine, the issue
boils down to the credibility of witnesses. Settled is the rule that the trial court’s assessment thereon is
accorded great respect because it heard the witnesses and observed their behavior and manner of
testifying unless it overlooked or misapplied some facts which could have affected the result of the case.
The proximate contact of the

______________

* EN BANC.

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People vs. Salonga

trial court with those who take the witness stand places them in a more competent position to
discriminate between a true and false testimony
Same; Same; Circumstantial Evidence; Requisites; Absence of direct proof relative to the commission of
the crime does not negate any possibility of conviction on the part of the accused; Circumstantial
evidence may alone be sufficient to prove elements of the crime so long as the requisites concur.—
Absence of direct proof relative to the commission of the crime does not negate any possibility of
conviction on the part of the accused-appellants. While there is no direct evidence relative to the
commission of the crime for which they were prosecuted, the circumstantial evidence proven in
contrast with the excuse offered by the defense, are sufficient to sustain their conviction beyond
reasonable doubt. Circumstantial evidence may alone be sufficient to prove elements of the crime so
long as the following requisites concur: 1. there is more than one circumstance; 2. the facts from which
the inferences are derived are proven; and 3. the combination of all the circumstances is such as to
produce a conviction beyond a reasonable doubt. In other words, the circumstances themselves, or a
combination thereof, should point to overt acts of the accused that would logically point to the
conclusion, and no other, that the accused is guilty of the crime charged and at the same time
inconsistent with the hypothesis that they are innocent.

Same; Same; Same; Evidence is weighed not counted; When facts or circumstances which are proved
are not only consistent with the guilt of the accused, but also inconsistent with his innocence, such
evidence, in its weight and probative force, may surpass direct evidence in its effect upon the court.—
Evidence is weighed not counted. When facts or circumstances which are proved are not only consistent
with the guilt of the accused, but also inconsistent with his innocence, such evidence, in its weight and
probative force, may surpass direct evidence in its effect upon the court. In the case at bar, we give
credence to the foregoing circumstantial evidence which clearly established the crime of rape with
homicide defined and penalized under Article 335 of the Revised Penal Code, as amended by Section 11,
R.A. 7659 which took effect on December 31, 1993.

Same; Rape; Rape is perpetrated when the accused has carnal knowledge of the victim by force and
without consent.—Rape is perpetrated when the accused has carnal knowledge of the victim by

470

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SUPREME COURT REPORTS ANNOTATED

People vs. Salonga

force and without consent. It is not essential that there be complete penetration of the female organ, it
is enough that the labia of the female organ was penetrated. Based on the evidence on record, sexual
intercourse with the victim was sufficiently established, as shown in the testimony of the medical doctor
who conducted the post mortem examination on the child’s body, x x x The injuries, laceration of the
hymen, contusions on labia majora and abrasions suffered by the victim clearly demonstrate that force
was employed upon her to satisfy the prurient desires of the accused-appellants.

Same; Same; Rape with Homicide; Damages; Death indemnity in rape with homicide is P100,000.00
because the prevailing jurisprudence is that P50,000.00 is for death and P50,000.00 is for rape.—As to
damages, the trial court awarded the heirs of the victim the sum of P50,000.00 as death indemnity,
P100,000.00 as moral damages and exemplary damages, P83,900.00 as actual damages and P15,000.00
as attorney’s fees plus costs of suit. In rape with homicide, the death indemnity was increased to
P100,000.00 because the prevailing jurisprudence is that P50,000.00 for death and P50,000.00 for rape.
However, the award of moral damages is reduced to P50,000.00 while the exemplary damages and
attorney’s fees are deleted for lack of legal basis and the award of actual damages is likewise reduced to
P18,000.00.

AUTOMATIC REVIEW of a decision of the Regional Trial Court of Tarlac, Tarlac, Br. 65.

The facts are stated in the opinion of the Court.

The Solicitor General for plaintiff-appellee.

Conrado Quiaoit for accused-appellants.

PER CURIAM:

The frailty of human flesh gives no excuse for the transgression of a woman’s purity, especially when
rape was coupled with the taking of the victim’s life. Such act is testament to a debased, perverted and
savage minds which deserve a penalty no less than death.

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471

People vs. Salonga

For automatic review is the decision of the Regional Trial Court, Branch 65, Tarlac, Tarlac finding Antonio
“Tony” Salonga, Alfredo “Fred” Danganan, and Eduardo “Eddie” Danganan, guilty of rape with homicide
under Article 335 of the Revised Penal Code, as amended by Republic Act No. 76591 and imposing upon
each of them the supreme penalty of death, in addition to ordering them to pay the heirs of the victim
the amount of P50,000.00 as death indemnity, P100,000.00 as moral and exemplary damages,
P83,900.00 as actual damages, P15,000.00 as attorney’s fees, and the costs of the suit.

The amended information alleged—

“That on or about November 10, 1994, in the Municipality of Tarlac, Province of Tarlac, Philippines and
within the jurisdiction of this Honorable Court, the above-named accused with the use of a bladed
instrument and other hard object, conspiring, confederating and helping with one another, did then and
there willfully, unlawfully and feloniously by means of force, threat and intimidation succeeded in
having carnal knowledge with Babylyn Garcia, 13 years old, single and virgin against her will, that on the
occasion thereof, the above-named accused with the use of a bladed weapon and a hard object stab
several times and hit her with hard object, on her head inflicting skull fracture on her head and stab
wound on the different parts of her body which cause her immediate death at the scene of the crime.

CONTRARY TO LAW.”2

Upon arraignment the accused-appellants pleaded “not guilty” to the charge.

We quote with approval the facts of the case as summarized by the trial court, as such facts are
supported by the evidence on record:

_____________

1 R.A. 8353 “The Anti-Rape Law of 1997” was not yet in force when the crime was committed.

2 Records, p. 33.

472

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SUPREME COURT REPORTS ANNOTATED

People vs. Salonga

“x x x xxx xxx

“Prosecution evidence shows that in the morning of November 10, 1994, Babylyn Garcia, a 13-year old
comely girl, 5 ft. 4 inches in height, left their house in Barangay Sta. Maria in Tarlac, Tarlac to attend her
classes as a First Year High School in the Gerona Tarlac, about 14 km. from the capital town of Tarlac.
Babylyn walked from their house to Sitio Maligaya in Barangay Sinait, Tarlac, Tarlac, a kilometer away.
From Sitio Maligaya, she stepped down the dike and crossed the almost 500-meter-wide Tarlac River,
which becomes passable by foot during the dry season, to reach Barangay Sta. Cruz Tarlac, where she
took a ride to Gerona. She was expected to be home as usual between 5:00 to 6:00 o’clock in the
afternoon of that day. On that fateful day of November 10, 1994, her father Pablito Garcia, failed to go
and meet her as he was wont to do [sic] at Brgy. Sta. Cruz and Babylyn must have decided to go home
alone, walking along the same beaten path that she and some residents thereabouts usually take in
crossing the river. Babylyn failed to come home at the expected time and her parents became worried.
Her father then decided to look for her in her school, in the houses of some relatives in Brgy. Sinait and
along the usual path that he and Babylyn used to take in crossing the river but did not find her.

Between 5:20 and 5:30 o’clock in the afternoon of November 10, 1994, Maximo Tabag, a resident of
Brgy. Sinait went to gather firewood at the dry portion of the Tarlac River, some 150 meters from the
river embankment in Sitio Maligaya where cogon grass and bamboos had already grown in clusters and
a few kakawati and acacia had taken root. While in the process of gathering firewood, Tabag heard
voices and peering through the tall cogon grasses, he saw three men about 12 to 15 meters away
dragging an unconscious woman, whose head was bloody and her dress stained with blood. (TSN, March
6, 1995 p. 7). As Tabag watched furtively behind tall cogon grasses, the three men whom he recognized
as Antonio Salonga, Alfredo Danganan and Eduardo Danganan, who appeared unaware of his presence
then dumped the unconscious woman, whom he also recognized as Babylyn Garcia amidst cogon
grasses near an acacia tree. Moments thereafter, he saw them leaving together in a hurry towards Brgy.
Sta. Cruz where Alfredo and his family reside.

Tabag did not attempt to approach the unconscious girl because he was afraid the three men might see
him and decide to go after him. He instead went home about four minutes after they left and kept silent
about what he saw because he feared the accused

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473

People vs. Salonga

(TSN, March 15, 1995), Tabag personally knows accused Alfredo Danganan and his brother, Eduardo,
because they are his barangay mates in Brgy. Sinait since they were yet young boys and their
halfbrother, accused Antonio Salonga, was his barangay mate in Brgy. Aguso where he (Tabag) once
resided for sometime. At the time he saw them in the river, Antonio Salonga was wearing a brown hat
made of bamboo and a sky-blue, long sleeved polo shirt, Alfredo Danganan was in white shorts and
white T-shirt and Eduardo Danganan was in maong pants and naked from the waist up (TSN, March 6,
1995, pp. 27-28).

Romeo Garcia, a kagawad of Barangay Sta, Maria and an uncle of Babylyn, together with a barangay
tanod, launched a search for his missing niece. They scoured out the pathway across the Tarlac River
between Sitio Maligaya and Brgy. Sta. Cruz. At about 2:00 o’clock in the early morning of November 11,
1994, Kgd. Garcia and his companion found the lifeless body of Babylyn concealed amidst cogon grasses
near an acacia tree about 150 meters from the river embankment in Sitio Maligaya. Aside from human
footprints, the school identification card of the victim and a woman shoe were found near the place
where the body was dumped. Kgd. Garcia then notified the police that the body of his niece had already
been found. SPO4 Conrado Duenas of Tarlac PNP, together with the two policemen and some members
of the Kababayan Center No. 9 in San Isidro, Tarlac, which has jurisdiction over Brgy. Sta. Maria and
Sinait, went to the place. They were told that the victim’s body which was already removed by relatives,
was found in a cogonal area. At about 7:00 a.m., November 11, 1994, the cadaver was brought to the
Enriquez funeral parlor in Tarlac for autopsy. Tabag, bothered by his conscience, decided to see Kgd.
Garcia at about 6:00 p.m. of that day and informed him of what he saw and asked him to cause the
investigation of the brothers Antonio, Alfredo ard Eduardo in connection with the slaying of Babylyn.
Kgd. Garcia brought Tabag to the police but Tabag did not reveal all the details of what he saw the three
accused did, not until they were arrested and detained.

Thereafter, SPO4 Oscar Mayor, a member of the Tarlac PNP, conducted an investigation of the death of
Babylyn Garcia. He conferred with the members of the Kababayan Center in Brgy. Sinait, who had earlier
made an ocular inspection of the crime scene. They furnished Mayor the names of Antonio Salonga,
Alfredo Danganan, Eduardo Danganan, Ronald Salvador and Cirilo Ibañez as possible suspects in the
killing. Ronald Salvador and Cirilo Ibañez later were

474

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SUPREME COURT REPORTS ANNOTATED

People vs. Salonga

excluded from the list of suspects for lack of evidence against them, SPO4 Mayor, with SPO2 Estabillo,
went to the house of Antonio Salonga in Brgy. Aguso on November 19, 1994, to inquire about his
whereabouts and what he had used on November 10, 1994, but Antonio was not at home then.
Antonio’s wife, however, told Mayor, that her husband was wearing a brown hat made of bamboo when
he and Alfredo went to Brgy. Sinait in the morning of November 10, 1994. When shown the hat, Mayor
noticed what he suspected to be a bloodstain on the hat. Mayor then asked Antonio’s wife if he could
have the hat and the latter in the presence of Danilo Bulanditan and Kgd. Conrado Capitulo as witness
voluntarily gave it to him after he issued a receipt dated November 10, 1994 (Exhibit ‘C’). Mayor then
submitted the hat, together with the blood-stained handkerchief and a piece of cloth of the victim, to
the National Bureau of Investigation (NBI) in Manila for laboratory examination. Based on the NBI
Biology Report No. E-94-1423 (Exhibit ‘D’) the contents of which were admitted by the defense (TSN,
March 13, 1995, p. 61), test results disclosed that ‘the above specimen all gave positive results for
human blood showing the same reaction of Group A.’

xxx xxx x x x”3

After the trial on the merits, the trial court rendered judgment on February 27, 1996 convicting all the
accused—

“WHEREFORE, this Court finds the accused Antonio “Tony” Salonga, Alfredo “Fred” Danganan and
Eduardo “Eddie” Danganan GUILTY beyond reasonable doubt of the crime of Rape with Homicide
defined and penalized in Article 335, as amended, of the Revised Penal Code, and hereby sentences
each of them to suffer the penalty of death, and to jointly and severally pay the heirs of Babylyn Garcia
the amount of P50,000.00 as death indemnity, the amount of P100,000.00 as moral and exemplary
damages, the amount of P83,900.00 as actual damages and the amount of P15,000.00 as attorney’s fees
and to pay the costs.

SO ORDERED.”4

_______________

3 Regional Trial Court Decision, pp. 2-5; Rollo, pp. 34-37; 99-102; Appellees Brief filed by the Solicitor
General, pp. 3-7, Rollo, pp. 138-142; Record, pp. 329-332.

4 Records, p. 347.
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People vs. Salonga

On account of the penalty imposed, the records were elevated to this Court for automatic review.5

Accused-appellants seek the reversal of the judgment of conviction insisting that the circumstantial
evidence presented by the prosecution against them is insufficient to prove their guilt beyond
reasonable doubt. They denied the charge and claimed that they could not have committed the crime of
rape with homicide and interposed the defense of alibi. Their testimonies are summarized in the
following portion of the decision of the trial court:

“x x x xxx x x x.

“Accused Alfredo Danganan testified that he and his half-brother, Antonio Salonga, went to Sitio
Maligaya, Brgy. Sinait, Tarlac, to visit their father, Benito Danganan, in the morning of November 10,
1994. He was then wearing white shorts and white boxer (TSN, Feb. 28, 1996, p. 11). He left Antonio at
the house of their father and went to collect the debts of his borrowers in Brgy. Sinait and Brgy. Maria.
He returned at 1:00 o’ clock in the afternoon. At 4:15 p.m., he and Antonio returned to Brgy. Sta. Cruz
because he had to attend the 6:00 p.m. ‘prayer and worship service’ at the Iglesia Ni Cristo chapel in
Brgy. Aguso where he also served as a deacon. In going home they took the ‘short cut’ route from Sitio
Maligaya towards Alfredo’s house in Brgy. Sta. Cruz. While crossing the river, Antonio heard the voices
of two women quarrelling. He told Antonio the voices seemed to come from Brgy. Sinait. They arrived at
his (Alfredo’s) house at 4:45 p.m. by his watch. After taking a bath, he dressed up and proceeded to the
chapel with his wife, Yolanda, at 5:30 p.m. and arrived their at 5:38 p.m. using his passenger jeep. After
signing his name on a loose leaf purporting to

_______________

5 Article 47 of the Revised Penal Code, as amended by Section 22 of R.A. 7659 provides that: x x In all
cases where the death penalty is imposed by the trial court, the records shall be forwarded to the
Supreme Court for automatic review and judgment by the court en banc, within twenty (20) days but
not earlier than fifteen (15) day? after promulgation of the judgment or notice of denial of any motion
for new trial or reconsideration. The transcript shall also be forwarded within ten (10) days after the
filing thereof by the stenographic reporter.

476

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SUPREME COURT REPORTS ANNOTATED


People vs. Salonga

be an attendance sheet, he performed his duties as a deacon. After the services, he and his wife
proceeded to the ‘big chapel’ of the INC in San Roque, Tarlac, at 10:00 p.m. and went home at 11:00
p.m. The following morning, November 11, 1994, when he returned to Brgy. Sinait to collect the debts of
his other borrowers, he learned from Kgd. Garcia, the uncle of Babylyn, that the latter, the daughter of
Pablito Garcia, was killed. He informed Kgd. Garcia and the policemen who were with him that when he
and Antonio were crossing the river on their way home the previous afternoon, his brother heard the
voices of two women quarrelling and he told him they appeared to be in Brgy. Sinait. Alfredo Danganan
testified on the witness stand in a manner as if he already knew just what his counsel would ask and
immediately gave his answer. At times, he seemed hesitant in answering questions propounded on cross
examination. His countenance on the witness stand appeared troubled.

Accused Antonio Salonga testified that he and his brother, Alfredo Danganan, went to Sitio Maligaya in
Brgy. Sinait at about 8:00 o’clock in the morning of November 10, 1994. After taking their launch (sic) in
the house of their father, Benito, he and Alfredo went home at about 4:15 p.m. of that day, based on his
calculation. As they were crossing the river, he heard the voices of two women who were quarreling and
Alfredo told him they seemed to be in Brgy. Sinait. They reached the house of Alfredo at around 4:45
p.m., again based on his calculation. Later, his brother and his wife, Yolanda, went to the INC chapel. He
stayed at their house up to the time when they returned at 11:00 o’clock in the evening. Then he went
home in Brgy. Aguso. At about 6:00 o’clock in the morning of November 11, 1994, he drove Alfredo’s
passenger jeep to earn some money to Camiling, Tarlac where according to him, a couple, Cenon Ibañez
and Fanny Limos, who managed a store in that town, stopped him and told him that the daughter of
Pedro Garcia was ‘raped and killed’ (TSN, March 7, 1996, p. 5). As closely observed by the Court, he
appeared listless as he answered questions propounded to him by his counsel or by the prosecution,
making the Court feel that he was not telling the truth. He admitted, however, that the brown hat made
of bamboo given by his wife to SPO4 Mayor belonged to him.

Accused Eduardo Danganan testified that in the morning of November 10, 1994, his brothers Antonio
and Alfredo came to their house in Sitio Maligaya, Brgy. Sinait. While Antonio stayed in the house,
Alfredo went out to collect the debts of his borrowers and returned at about 1:00 p.m. of the same day.
At about 2:00 p.m., he

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People vs. Salonga

went to the house of Remegio Manoloto and helped his brother, Arcadio, pile up about 60 cavans of
palay in Manoloto’s house up to 6:00 p.m. Thereafter, he went home and slept. The following day
November 11, 1994, Kgd. Garcia and the Brgy. Captain of Sinait passed by their house and asked him if
he noticed a man who may have passed by their place and told him that the daughter of Pabling Garcia
was killed. Together with Bong Dela Cruz and Ronald Dela Cruz, he went to the house of the victim but
the body had not as yet been brought home. On November 12, 1994, he, Antonio Salonga and Alfredo
Danganan were brought to the police station for investigation. Before he was made to talk, SPO2
Versoza punched him, hit him with a stick on his chest and kicked his feet. He then gave a statement and
signed it. He claimed he does not know the victim (TSN, March 12, 1996, p. 12). He said he was not also
familiar with the place where they found the body of the victim, which is only about 200 meters away
from their house. His source of income was farming and sometimes catching birds in the swamp near
where the incident occurred. In giving his testimony, Eduardo appeared as if he knew what questions his
counsel would asked and gave his answers as if he didn’t care. The Court could not but feel insincerity in
his voice. Although the Court could not describe it, still it could recognize if from his demeanor (sic) that
the accused himself did not believe that his version would be accepted as true. In short he lacked
conviction in the manner he testified.

Yolanda Danganan, Alfredo’s wife, corroborated Alfredo’s allegation that he and Antonio were already
in their house at Brgy. Sta. Cruz at around 4:45 p.m. She was sure of the time because she was watching
TV and had seen the time on the wall clock when Antonio and Alfredo arrived. Later, she and her
husband went to attend the service at the chapel of the INC in Brgy. Aguso, and came home at about
11:00 in the evening. Salvacion Magallanes, who was at the house of Yolanda in the afternoon of
November 10, 1994 to help a friend borrow some money from Yolanda, corroborated Yolanda’s
testimony that Antonio Salonga and Alfredo Danganan arrived at the latter’s house at 4:45 p.m. because
she was watching Channel 9 and happened to look also at the wall clock. Rolando dela Cruz, who
appeared hesitant in testifying, alleged that he and Eduardo went to the house of the victim in the
morning of November 11, 1994 and ‘magosyoso’ (to learn about the incident). Leopoldo Taberna, who
appeared defensive, testified that Alfredo Danganan and his father, Benito, attended the funeral of
Babylyn Garcia. Arcadio Danganan, brother of the accused, corroborated the testimony of Eduardo that

478

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SUPREME COURT REPORTS ANNOTATED

People vs. Salonga

he helped him carry palay from 4:00 to 6:00 p.m. in the house of Remigio Manoloto. Jeremias del Mar,
and INC deacon, claimed he saw Alfredo Danganan at the INC chapel in Aguso at 5:45 p.m., November
10, 1994 and even signed the ‘Lagda sa Pulong.’ It appears, however, that the signatures, including that
of accused Alfredo Danganan, were written on November 6, 1994.

xxx xxx x x x”6

Accused-appellants harp on the alleged inconsistencies in the witness’ testimonies. To bolster their
defense, attention is drawn to the following alleged inconsistencies in the testimonies of the
prosecution witness—

(1) They contend that the trial court failed to consider the serious discrepancies in Maximo Tabag’s
Sinumpaang Salaysay given on January 18, 1995 and his testimony in open court considering that in the
Sinumpaang Salaysay he never mentioned that he saw the accused-appellants dragging the dead and
bloodied body of Babylyn Garcia to the cogonal area as testified to in open court but merely stated
therein that he saw the accused-appellants leaving the place where the dead body of the victim was
found.

(2) From the date of the occurrence of the incident—November 10, 1994 up to the execution of the
Sinumpaang Salaysay on January 18, 1995, a period of 69 days had elapsed and Maximo Tabag failed to
mention this very important part in his Sinumpaang Salaysay.

(3) If Maximo Tabag saw the three (3) accused dragged the dead and bloodied body of the victim he
would have done what a man should have normally done under the circumstances. Yet, he did not go to
the place where the accused came from; he did not attempt to see whether the victim was still alive or
not; he did not help the victim; he did not report to the police; he did not report to the barangay
officials; and, he did not report to the parents of the victim.7

_____________

6 Regional Trial Court Decision, pp. 6-9; Rollo, pp. 38-41; 103-105.

7 Brief for the Accused-Appellants, p. 14, Rollo, pp. 81-82.

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(4) When Jesusa Bartolome testified during the preliminary examination she declared that she could not
identify the man he saw sitting on the river but in open court she said that if she could see the man
again she could recognize him and pointed to accused-appellant Antonio Salonga.

We are not persuaded by the submissions of the accused-appellants. Accused-appellants assail the
testimonies of prosecution witness Maximo Tabag when he failed to mention in his sworn statement,
dated January 18, 1995 that he saw the accused-appellants dragging the lifeless body of the victim.
There is no real discrepancy in the two statements made by Tabag. In his Sinumpaang Salaysay, he
stated that he saw the accused-appellants leaving the cogonal area near the scene of the crime where
the body of the victim was found8 but Tabag was able to sufficiently explain in court that he did not
reveal the details of the incident to the police when he gave the Sinumpaang Salaysay since he was
afraid for his life, but revealed to the fiscal what had happened—

__________________

8 Tabag’s Sinumpaang Salaysay, Records, p. 58.

“03.
T—

Maaari mo bang ilahad ang buong pangyayari hinggil sa nalalaman mong impormasyon hinggil sa
insiden-teng ito?

S—

Noong humigit kumulang alas 5:20 hanggang 5:30 ng hapon ng Nobiyembre 10, 1994, ako po noon ay
nasa may ilog, sa talahibang bahagi at may mga kawayan doon, sa Sitio Maligaya, Brgy. Sinait, Tarlac,
Tarlac upang buhatin ang mga kahoy panggatong na aking pinulot doon ng bigla akong may narinig na
kaluskosat ingay subalit ng ako ay palapit, nakita ko na may tatlong kalalakihan na nagmamadaling paalis
doo kaya’t hindi ko na itinuloy ang aking balak at bu- malik sa lugar na kung saan ko iniwan ang bigkis ng
kahoy at binuhat uli ito at umuwi na sa Brgy. Sinait, Tarlac, Tarlac.”

480

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SUPREME COURT REPORTS ANNOTATED

People vs. Salonga

Q:

And these (sic) ‘sworn statement of yours was taken on January 18, 1995 and which statement is
identified as exhibit 1 for the defense, do you agree with me Mr. Witness that you never state here that
you saw the three persons dragging Babylyn Garcia to the Cogonal area on November 10, 1994?

Fiscal Capulong

May we allow the witness to see the sworn statement?

A:

I did not state in my statement but I told the matter to

Fiscal Cerezo, sir.

Q:

But your purpose in going to the police station on Janu-ary 18, 1995 is to give a statement on what you
saw on November 10, 1994, is that correct?

A:

Yes sir, I told them what I saw but I did not tell all what I saw sir.

Q:
You did not tell all despite the fact that you were given the opportunity by SPO4 Oscar Mayor.

A:

Because it was not asked of me of what I saw in the place of the incident?

Q:

I will read to you question no. 3 : Maari mo bang ilahad and buong pangyayari hingil sa nalalaman . . .”

Q:

This is your answer to that question?

A:

Yes sir.

Q:

Now, in this question you were asked to tell the whole incident of what you know and said you did not
tell the police what you saw three persons dragged Babylyn Gar-cia to the cogonal area, is that correct?

A:

I did not tell them sir.

Q:

Now, you did not tell the police that you saw three (3) dragged Babylyn Garcia to the cogonal area and
even to the policeman who were your relatives, to the Brgy. Officials in Brgy. Sinait because you did not
actually see three (3) persons dragging a woman?

FISCAL CAPULONG

The question is misleading, as to how he told him to the policeman, as a matter of fact, he did not.

JUDGE:

The question is very clear.

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People vs. Salonga


You did not tell because you did not see three persons dragging a woman?

A:

I saw them sir but I did not tell the police but I told this to Fiscal Cerezo because I am trying to protect
myself.”9

Accused-appellants insist that the testimony of Maximo Tabag is contrary to human nature or ordinary
course of things because he never helped the victim; never reported it to the relatives or barangay
officials of Sinait; and he never went to the place where the victim was dragged despite opportunity to
do the same. Tabag did not attempt to go to the place where the victim was dragged nor immediately
report to the authorities the horrifying experience he had witnessed because he was afraid that
accused-appellants will harm him had they known that he was the one who saw them. Besides, there is
no standard form of the human behavioral response to a startling or frightful experience10 and the
delay in bringing up the matter to the authorities do not destroy the veracity and credibility of the
testimony offered. The court takes judicial notice of some people’s reluctance to be involved in criminal
trials. Failure to volunteer what one knows to law enforcement officials does not necessarily impair a
witness’ credibility.11

Accused-appellants assail the credibility of prosecution witness Jesusa Bartolome, a school principal, on
the ground of being inconsistent. We emphasize that she has no interest in the case and it is
inconceivable on her part to impute to innocent persons the commission of the crime, when she has no
compelling reason to do so. Moreover, she was able to satisfactorily explain in court the reason why she
stated in the preliminary investigation of the case that should the man whom she saw near the scene of
the crime within a distance of ten (10) meters be presented to her, she would not be able to identify the
same, for what she only distinctly remembered was

_______________

9 TSN, June 23, 1995, pp. 17-18.

10 People vs. Miranda 262 SCRA 351 [1996].

11 People vs. De Leon, 248 SCRA 609 [1995) cited, in People vs. Alberca, 257 SCRA 613, 631 [1996].

482

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SUPREME COURT REPORTS ANNOTATED

People vs. Salonga

tive identification of accused-appellant Antonio Salonga, as the man she saw near the crime scene, as
follows:

“Q
Another question on that preliminary investigation on page 2 TSN.

Q:

If you see him again could you identify this man?

A:

I have not seen his face only the polo and hat made me identify him.

Q:

Were you asked this question and you gave that answer?

A:

Yes sir.

Q:

In your testimony a while ago you stated that you saw he face of the man sitting on the water but your
testimony in the Municipal Trial Court, Tarlac in that pre- liminary investigation, you did not see the
face, you only saw the polo and the hat?

A:

That was made sir because of fear, because I was not then so serious with the statement given by me
because of fear, I still have that fear that I felt when I saw the man it was right after the event when the
police came and told me that somebody was raped and killed so I was not able to give the right answer.

Q:

When you testified before the Municipal Trial Court of Tarlac in the preliminary investigation you were
not serious in your statement?

A:

Not so serious sir but the fear that come to my body then so I was myself confused with the statement
given.”12

Notably, her statement given to the police on December 12, 1994 did not fully negate the possibility of
her capacity to identify the man seated on the edge of the river when she testified that:

Q:

In your statement before the police dated December 12, 1994 already marked as Exhibit “J,” you were
asked this question and you made this answer: “Kung kayo po ay mabibigyan ng pagkakataon na makita
pa ang taong in-

_______________

12 TSN, pp. 11-12, Dec. 3, 1996.


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People vs. Salonga

yong hinabanggit, makikilala o maituturo ba ninyo?

Sagot: Maari po siguro.” Do you remember having stated that?

A:

Yes, sir.”13

In fine, the issue boils down to the credibility of witnesses. Settled is the rule that the trial court’s
assessment thereon is accorded great respect because it heard the witnesses and observed their
behavior and manner of testifying14 unless it overlooked or misapplied some facts which could have
affected the result of the case.15 The proximate contact of the trial court with those who take the
witness stand places them in a more competent position to discriminate between a true and false
testimony.

Absence of direct proof relative to the commission of the crime does not negate any possibility of
conviction on the part of the accused-appellants. While there is no direct evidence relative to the
commission of the crime for which they were prosecuted, the circumstantial evidence proven in
contrast with the excuse offered by the defense, are sufficient to sustain their conviction beyond
reasonable doubt. Circumstantial evidence may alone be sufficient to prove elements of the crime so
long as the following requisites concur:16

1. there is more than one circumstance;

2. the facts from which the inferences are derived are proven; and

3. the combination of all the circumstances is such as to produce a conviction beyond a reasonable
doubt.

_______________

13 Ibid., p. 9.

14 People of the Philippines vs. Efren Buendia, G.R. Nos. 133949-51, September 16, 1999, 314 SCRA 655
citing People v. Dela Cruz, 276 SCRA 191 [1997]; People v. Corea, 269 SCRA 76 [1997]; People v. Frago,
232 SCRA 653 [1994].

15 People vs. Codillo, 224 SCRA 104 [1993]; People vs. Matrimonio, 215 SCRA 613 [1992].
16 Section 4, Rule 133, Revised Rules on Evidence.

484

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SUPREME COURT REPORTS ANNOTATED

People vs. Salonga

In other words, the circumstances themselves, or a combination thereof, should point to overt acts of
the accused that would logically point to the conclusion, and no other, that the accused is guilty of the
crime charged and at the same time inconsistent with the hypothesis that they are innocent.17

After a thorough review of the evidence, we find the following circumstantial evidence established by
the prosecution, to have successfully overcome the constitutional presumption of innocence and
established the guilt of the accused-appellants beyond reasonable doubt: that Eduardo Danganan, on
two occasions uttered to the victim sometime prior to the brutal crime “Karagul mo na Lyn-lyn, apanaya
da ka mo rin” (You are already a young woman, Lyn-Lyn, I have not tired waiting for you);18 on the day
of the bestial killing, November 10, 1994, at about 5:00 to 5:30 p.m., Jesusa Bartolome saw Antonio
Salonga sitting in the shallow portion of the Tarlac river wearing a brownish hat made of bamboo and a
sky-blue, long-sleeved polo shirt;19 on the same day, between 5:20 to 5:30 in the afternoon, Maximo
Tabag saw Antonio Salonga, Alfredo Danganan and Eduardo Danganan together dragging the body of
the victim to the cogonal area near the Tarlac river;20 when Maximo Tabag saw Antonio Salonga, the
latter was wearing a brownish hat made of bamboo and a skyblue colored, long-sleeved polo shirt
Alfredo Danganan was wearing white shorts and t-shirt and Eduardo Danganan was wearing maong
pants and naked from the waist-up;21 the wife of Antonio Salonga attests that the hat with suspected
bloodstain belongs to her husband and the same was used on November 10, 1994 when Antonio
Salonga and Alfredo Danganan went to Sitio Maligaya, Brgy Sinait, Tarlac, Tarlac;22 Alfredo Danganan
corroborated Tabag’s description of his

_________________

17 People vs. Contante, 12 SCRA 653 [1964]; People vs. De Guia, 280 SCRA 141 [1997].

18 TSN, November 12, 1996, pp. 5-8.

19 TSN, December 3, 1996, pp. 4-7.

20 TSN, March 6, 1995, pp. 6-8.

21 TSN, March 6, 1995, pp. 27-28.

22 Exhibit “B,” Records, pp. 120-121.

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People vs. Salonga

attire on November 10, 1994;23 the NBI Biology Report revealed that the bloodstained hat of Antonio
Salonga together with the bloodstained handkerchief and a piece of cloth belonging to the victim, all
gave positive results for human blood showing reactions to Group “A”;24 the autopsy report on the
cadaver of the victim revealed that the victim sustained cracked skull, injuries in neck and in thorax,
multiple lacerated wounds, hematoma on labia majora and laceration of the hymen.25

Evidence is weighed not counted. When facts or circumstances which are proved are not only consistent
with the guilt of the accused, but also inconsistent with his innocence, such evidence, in its weight and
probative force, may surpass direct evidence in its effect upon the court.26 In the case at bar, we give
credence to the foregoing circumstantial evidence which clearly established the crime of rape with
homicide defined and penalized under Article 335 of the Revised Penal Code, as amended by Section 11,
R.A. 7659 which took effect on December 31, 1993 as follows:27

“When and how rape is committed—Rape is committed by having carnal knowledge of a woman under
any of the following circumstances.

1.) By using force or intimidation;

2.) When the woman is deprived of reason or otherwise unconscious; and

3.) When the woman is under twelve years of age or is demented.

The crime of rape shall be punished by reclusion perpetua.

________________

23 TSN, February 28, 1996, p. 11.

24 Exhibit “D,” Records, p. 123.

25 Exhibit “A,” Records, pp. 52-53.

26 People v. Abitona, 240 SCRA 335 [1995].

27 This Article was further amended, modified and repealed by R.A. 8353 otherwise known as the “Anti-
Rape Law of 1997” and was renumbered to Articles 266-A and 266-B of the Revised Penal Code as a
crime against persons.

486

486

SUPREME COURT REPORTS ANNOTATED


People vs. Salonga

Whenever the crime of rape is committed with the use of deadly weapon or by two or more persons,
the penalty shall be reclusion perpetua to death.

When by reason or on the occasion of the rape, the victim has become insane, the penalty shall be
death.

When the rape is attempted or frustrated and a homicide is committed by reason or on the occasion
thereof, the penalty shall be reclusion perpetua to death.

When by reason or on the occasion of the rape, a homicide is committed, the penalty shall be death.

The death penalty shall also be imposed if the crime of rape is committed with any of the following
attendant circumstances:

1.) When the victim is under eighteen (18) years of age and the offender is a parent, ascendant, step-
parent, guardian, relative by consanguinity or affinity within the third civil degree, or the common-law
spouse of parent of the victim.

2.) When the victim is under the custody of the police or military authorities.

3.) When the rape is committed in full view of the husband, parent, any of the children or other relatives
within the third degree of consanguinity.

4.) When the victim is a religious or a child below seven (7) years old.

5.) When the offender knows that he is afflicted with Acquired Immune Deficiency Syndrome (AIDS)
disease.

6.) When committed by any member of the Armed Forces of the Philippines or Philippine National Police
or any law enforcement agency.

7.) When by reason or on occasion of the rape, the victim has suffered permanent physical mutilation.

Rape is perpetrated when the accused has carnal knowledge of the victim by force and without
consent.28 It is not essential that there be complete penetration of the female organ, it is enough that
the labia of the female organ was

_______________

28 People of the Philippines vs. Efren Buendia, G.R. Nos. 133949-51, September 16, 1999, supra..

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People vs. Salonga


penetrated.29 Based on the evidence on record, sexual intercourse with the victim was sufficiently
established, as shown in the testimony of the medical doctor who conducted the post mortem30
examination on the child’s body:

_______________

29 People vs. Oscar, 48 Phil. 527; People vs. Hernandez, 49 Phil. 980.

30 Result of postmortem examination conducted by Dr. Cesar Padlan, Municipal Health Officer of Tarlac:

Consent of Autopsy:

The body is fairly developed fairly nourished measuring 5’4” in length (sic), the head is soaked with
blood.

‘Head—normocephalic, with equally distributed long black hair, soaked with her own blood.

‘Scalp—there is open skull fracture measuring 4 cm. x 4 cm. with brain tissues. Circular with rugged
edges noted on left tempora—parietal occipital area.

‘Face—multiple lacerated wound measuring 3 cm., 2 cm., 4 cm., 2 cm., at the upper and lower eyelid
with exposure of the bony prominence noted at the left eye.

—multiple stab wound measuring 3 cm., 1 cm., 1.2 cm. and 4 cm. and 4 cm. noted at the sub-maxillary
aspect of the left jaw.

—stab wound measuring 3 cm. left thru and thru at the base of the maxilla exited at the right maxillary
area measuring 1.2 cm.

Neck—linear, circular abrasion with hematoma around the neck. The whole head is asphyxiated.

Thorax—both right and left breast are with multiple lacerated wound measuring 0.5 cm. with
hematoma, noted on both nipples and areola.

Internal Examination—there is a slight laceration 10 o’clock of the hymen.

Cause of Death:

Asphyxia, hypovolemic shock secondary to severe blood loss due to multiple stab wounds.’ Exhibit “A”
Records, pp. 52-53; 110-111; 118-119.

488

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SUPREME COURT REPORTS ANNOTATED


People vs. Salonga

“Q:

On your page 2 exhibit a-1, you mentioned genitalia- hematoma, mas pubis-hematoma on labia majora,
what do you mean by these doctor? sir.

A:

There is a slight laceration at 10:00 o’clock of the hymen

Q:

In your examination, you stated to this Honorable Court also at a certain degree of certainty whether in
your opinion Babylyn Garcia was raped?

A:

It is possible sir.

Q:

Did you see any sign of rape in the body of Babylyn Gar-cia at the time of the examination?

A:

Those injuries found at the thorax with multiple lacer-ated wound and these are signs of force violence.

Q:

Now maybe you are in a position to state what cause the laceration at the ten o’clock of the hymen?

A:

Maybe due to any penetration that may cause the hymen to be lacerated at ten o’clock sir.

Q:

It maybe cause by any instrument or anything that maybe inserted in sir.

Q:

And these laceration could be caused deliberately or int entionally?

A:

It is possible sir that they were done intentionally.

Q:

Now, how about the hematoma in the genitalia?

A:

It is due to bite because this was a sign of kissmark sir.


Q:

Also this hematoma?

A:

Yes sir.

Q:

For a clearer understanding of your medical term, what do you mean by mona (sic) pubis hematoma on
labia majora?

A:

Hematoma of the mona(sic) pubis will be due to sucking and biting the labia majora due to biting-
sucking tension in the skin that cover the sex organ sir.

Q:

Following your line of answer what cause these injuries?

A:

Due to biting and sucking sir.”31

_________________

31 TSN, March 6, 1995, pp. 34-35.

489

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489

People vs. Salonga

The injuries, laceration of the hymen, contusions on labia majora and abrasions suffered by the victim
clearly demonstrate that force was employed upon her to satisfy the prurient desires of the accused-
appellants.

Coming now to the penalty, the trial court correctly imposed the penalty of death since Article 335 of
the Revised Penal Code, as amended by R.A. 7659 provides that “when by reason or occasion of the
rape, a homicide is committed, the penalty shall be death.” Being a single indivisible penalty, the Court
mandatorily applies the same in the light of Article 47 of the Revised Penal Code32 and “regardless of
any mitigating or aggravating circumstance that may have attended the commission of the crime.”33
Four members of the Court maintain their position that Republic Act No. 7659, insofar as it prescribes
the death penalty, is unconstitutional; nevertheless they submit to the ruling of the Court, by majority
vote, that the law is constitutional and the death penalty should be accordingly imposed.

As to damages, the trial court awarded the heirs of the victim the sum of P50,000.00 as death
indemnity, P100,000.00 as moral damages and exemplary damages, P83,900.00 as actual damages and
P15,000.00 as attorney’s fees plus costs of suit.

__________________

32 Article 47, RPC, as amended by Sec. 22, R.A. 7659.—In what cases the death penalty shall not be
imposed; Automatic review of death penalty cases.—The death penalty shall be imposed in all cases in
which it must be imposed under existing laws, except when the guilty person is below eighteen (18)
years of age at the time of the commission of the crime or is more than seventy years of age or when
upon appeal or automatic review of the case by the Supreme Court, the required majority vote is not
obtained for the imposition of the death penalty, in which cases the penalty shall be reclusion perpetua,
xxx xxx

33 Article 63, RPC. Rules for the application of indivisible penalties.—In all cases in which the law
prescribes a single indivisible penalty, it shall be applied by the courts regardless of any mitigating or
aggravating circumstances that may have attended the commission of the deed.

xxx xxx

490

490

SUPREME COURT REPORTS ANNOTATED

People vs. Salonga

In rape with homicide, the death indemnity was increased to P100,000.00 because the prevailing
jurisprudence is that P50,000.00 for death and P50,000.00 for rape.34 However, the award of moral
damages is reduced to P50,000.0035 while the exemplary damages and attorney’s fees are deleted for
lack of legal basis and the award of actual damages is likewise reduced to P18,000.00.36

WHEREFORE, the Decision of the trial court finding the accused-appellant Antonio Salonga alias Tony,
Alfredo Danganan alias Fred, and Eduardo Danganan alias Eddie, guilty of rape with homicide under
Article 335 of the Revised Penal Code, as amended by Section 11 of R.A. 7659 and imposing upon each
of them the supreme penalty of DEATH and to suffer the accessory penalties provided by law is
AFFIRMED with the MODIFICATION that the accused shall indemnify the heirs of the victim, P100,000.00
as civil indemnity, P50,000.00 as moral damages, P18,000.00 as actual damages.

In accordance with Section 25 of the RA 7659, amending Article 83 of the Revised Penal Code, upon the
finality of this Decision, let the records of this case be forthwith forwarded to the Office of the President
for the possible exercise of executive clemency or pardoning power.

SO ORDERED.
Davide, Jr. (C.J.), Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza, Panganiban, Quisumbing,
Purisima, Pardo,

_________________

34 People vs. Tahop, G.R. No. 125330, September 29, 1999, 315 SCRA 465 citing People vs. Robles, Jr.,
G.R. No. 124300, March 25, 1999, 305 SCRA 273.

35 People vs. Hivela, G.R. No. 132061, September 21, 1999, 314 SCRA 815 citing People vs. Ayo, G.R. No.
123540, March 30, 1999, 305 SCRA 543; People vs. Mengote, G.R. No. 130491, March 25, 1999, 305
SCRA 380; People v. Laray, G.R. No. 101809, February 20, 1996, 253 SCRA 654.

36 Evidence on record showed that only P18,000.00 was incurred for the burial expenses, hence the
award of actual damages is limited to said amount; Exhibit “F,” p. 127.

491

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People vs. Tayag

Buena, Gonzaga-Reyes, Ynares-Santiago and De Leon, Jr., JJ., concur.

Judgment affirmed with modification.

Notes.—It is not uncommon for a witness to a crime to show some reluctance about getting involved in
a criminal case, as in fact the natural reticence of most people to get involved is of judicial notice—and
this is specially true in a case where the parties involved are not just townmates but immediate
neighbors. (People vs. Rubio, 257 SCRA 528 [1996])

In those instances where the Supreme Court sustained convictions for rape with homicide based on
purely circumstantial evidence, the prosecution was able to present other tell-tale signs of rape such as
the location and description of the victim’s clothings, especially her undergarments, the position of the
body when found and the like. (People vs. Domantay, 307 SCRA 1 [1999])

——o0o—— People vs. Salonga, 329 SCRA 468, G.R. No. 128647 March 31, 2000

58

SUPREME COURT REPORTS ANNOTATED

Lao vs. Court of Appeals

G.R. No. 82808. July 11, 1991.*

DENNIS L. LAO, petitioner, vs. HON. COURT OF APPEALS, JUDGE FLORENTINO FLOR, Regional Trial Court,
Branch 89 of Morong, Rizal BENJAMIN L. ESPIRITU, MANUEL QUERUBIN and CHAN TONG, respondents.
Civil Law; Damages; Elements of action for damages based on malicious prosecution.—“To maintain an
action for damages based on malicious prosecution, three elements must be present: First, the fact of
the prosecution and the further fact that the defendant was himself the prosecutor, and that the action
was finally terminated with an acquittal; second, that in bringing the action, the prosecutor acted
without probable cause; and third, the prosecutor was actuated or impelled by legal malice” (Ferrer vs.
Vergara, 52 O.G. 291).

Due Process; Gross ignorance, negligence and dereliction of duty of attorney deprived client of day in
court.—There is merit in petitioner’s contention that he was deprived of his day in court in the damage
suit filed by Espiritu, due to the gross ignorance, negligence, and dereliction of duty of Attorney Manuel
Querubin whom his employer had hired to act as counsel for him and the St. Joseph Lumber. However,
Attorney Querubin neglected to defend Lao. He concentrated on the defense of the company and
completely forgot his duty to defend Lao as well.

PETITION for review from the decision of the Court of Appeals.

The facts are stated in the opinion of the Court.

F. Sumulong & Associates Law Offices for petitioner.

Manuel LL. Querubin for and in his own behalf.

Enrique M. Basa for private respondent

GRIÑ0-AQUINO, J.:

For being a witness in an unsuccessful estafa case which his employer filed against a debtor who had
defaulted in paying his just obligation, the petitioner was sued, together with his employer, for damages
for malicious prosecution. The issue in this case is whether the damages awarded to the defaulting
debtor

_____________

* FIRST DIVISION.

59

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Lao vs. Court of Appeals

may be satisfied by execution against the employee’s property since his employer’s business has already
folded up. Petitioner Dennis Lao was an employee of the New St. Joseph Lumber & Hardware Supply,
hereinafter called St. Joseph Lumber, owned by the private respondent, Chan Tong. In January 1981, St.
Joseph Lumber filed a collection suit against a customer, the private respondent, Benjamin Espiritu, for
unpaid purchases of construction materials from St. Joseph Lumber.

In November 1981, upon the advice of its lawyer, St. Joseph Lumber filed a criminal complaint for estafa
against Espiritu, based on the same transaction. Since the petitioner was the employee who transacted
business with Espiritu, he was directed by his employer, the firm’s owner, Chan Tong, to sign the
affidavit or complaint prepared by the firm’s lawyer, Attorney Manuel Querubin.

Finding probable cause after conducting a preliminary investigation of the charge, the investigating fiscal
filed an information for estafa in the Court of First Instance of Quezon City against Espiritu. The case was
however later dismissed because the court believed that Espiritu’s liability was only civil, not criminal.

On April 12, 1984, Espiritu filed a complaint for malicious prosecution against the petitioner and St.
Joseph Lumber, praying that the defendants be ordered to pay him P500,000 as moral damages,
P10,000 as actual damages, and P100,000 as attorney’s fees.

In his answer to the complaint, the petitioner alleged that he acted only as agent or employee of St.
Joseph Lumber when he executed the affidavit which his employer submitted to the investigating fiscal
who conducted the preliminary investigation of his employer’s estafa charge against Espiritu.

The pre-trial of the case was set on October 30, 1984. Since the defendants and their counsel failed to
appear in court, they were declared in default.

On November 11, 1984, the defendants filed a motion for reconsideration of the order of default.

On November 13, 1984, the motion was granted, and the order of default was set aside.

On January 16, 1985, the defendants, including herein peti-

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Lao vs. Court of Appeals

tioner Lao, and their counsel, again failed to attend the pre-trial despite due notice to the latter who,
however, failed to notify Lao. They were once more declared in default. The private respondent was
allowed to present his evidence ex parte.

On January 22, 1985, a decision was rendered by the trial court in favor of Espiritu ordering the
defendants Lao and St. Joseph Lumber to pay jointly and severally to Espiritu the sums of P100,000 as
moral damages, P5,000 as attorney’s fees, and costs.

Petitioner’s motion for reconsideration of the decision was denied by the trial court.

On February 25, 1985, Lao filed a motion for new trial on the ground of accident and insufficiency of
evidence, but it was denied by the trial court.
He appealed to the Court of Appeals (CA-G.R. CV No. 06796, “Benjamin L. Espiritu, plaintiff-appellee vs.
Dennis Lao and New St. Joseph Lumber and Hardware Supply, defendants-appellant”). The appellate
court dismissed his appeal on May 21, 1987. He filed this special civil action of certiorari and prohibition
to partially annul the appellate court’s decision and to enjoin the execution of said decision against him.
The petitioner avers that the Court of Appeals erred:

1. in not holding that he (petitioner Lao) has a valid defense to the action for malicious prosecution in
Civil Case No. 84-M;

2. in not holding that he was deprived of a day in court due to the gross ignorance, negligence and
dereliction of duty of the lawyer whom his employer hired as his and the company’s counsel, but who
failed to protect his interest and even acted in a manner inimical to him; and

3. in not partially annulling the decision of the trial court dated January 22, 1985 insofar as he is
concerned.

The petition is meritorious.

Lao had a valid defense to the action for malicious prosecution (Civil Case No. 84-M) because it was his
employer, St. Joseph Lumber, not himself, that was the complainant in the estafa case against Espiritu. It
was Chan Tong, the owner of the St. Joseph Lumber, who, upon advice of his counsel, filed the criminal
complaint against Espiritu. Lao was only a witness in

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the case. He had no personal interest in the prosecution of Espiritu for he was not the party defrauded
by Espiritu. He executed the affidavit which was used as basis of the criminal charge against Espiritu
because he was the salesman who sold the construction materials to Espiritu. He was only an agent of
St. Joseph Lumber, hence, not personally liable to the party with whom he contracted (Art. 1897, Civil
Code; Philippine Products Co. vs. Primateria Societe Anonyme, 122 Phil. 698).

“To maintain an action for damages based on malicious prosecution, three elements must be present:
First, the fact of the prosecution and the further fact that the defendant was himself the prosecutor, and
that the action was finally terminated with an acquittal; second, that in bringing the action, the
prosecutor acted without probable cause; and third, the prosecutor was actuated or impelled by legal
malice” (Ferrer vs. Vergara, 52 O.G. 291).

Lao was only a witness, not the prosecutor in the estafa case. The prosecutor was his employer, Chan
Tong or the St. Joseph Lumber.

There was probable cause for the charge of estafa against Espiritu, as found and certified by the
investigating fiscal himself.
Lao was not motivated by malice in making the affidavit upon which the fiscal based the filing of the
information against Espiritu. He executed it as an employee, a salesman of the St. Joseph Lumber from
whom Espiritu made his purchases of construction materials and who, therefore, had personal
knowledge of the transaction. Although the prosecution of Espiritu for estafa did not prosper, the
unsuccessful prosecution may not be labelled as malicious. “Sound principles of justice and public policy
dictate that persons shall have free resort to the courts for redress of wrongs and vindication of their
rights without later having to stand trial for instituting prosecutions in good faith” (Buenaventura vs.
Sto. Domingo, 103 Phil. 239).

There is merit in petitioner’s contention that he was deprived of his day in court in the damage suit filed
by Espiritu, due to the gross ignorance, negligence, and dereliction of duty of Attorney Manuel Querubin
whom his employer had hired to act as counsel for him and the St. Joseph Lumber. However, Attorney
Querubin neglected to defend Lao. He concentrated on the

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Lao vs. Court of Appeals

defense of the company and completely forgot his duty to defend Lao as well. He never informed Lao
about the pre-trial conferences. In fact, he (Attorney Querubin) neglected to attend other pre-trial
conferences set by the court.

When adverse judgment was entered by the court against Lao and the lumber company, Attorney
Querubin did not file a motion for reconsideration of the decision. He allowed it to become final,
because anyway Espiritu would not be able to satisfy his judgment against Chan Tong who had informed
his lawyer that the St. Joseph Lumber was insolvent, had gone out of business, and did not have any
leviable assets. As a result, Espiritu levied on the petitioner’s car to satisfy the judgment in his favor
since the company itself had no more assets that he could seize.

In view of the foregoing circumstances, the judgment against Lao was a nullity and should be set aside.
Its execution against the petitioner cannot be allowed to proceed.

WHEREFORE, judgment is hereby rendered partially setting aside the decision of the Court of Appeals
dated May 21, 1987, insofar as it declared the petitioner, Dennis Lao, solidarily liable with St. Joseph
Lumber to pay the damages awarded to the private respondent Benjamin Espiritu. Said petitioner is
hereby absolved from any liability to the private respondent arising from the unsuccessful prosecution
of Criminal Case No. Q-20086 for estafa against said private respondent. Costs against the private
respondent.

SO ORDERED.

Narvasa, Cruz and Medialdea, JJ., concur.

Gancayco, J., On Leave.


Decision partially set aside.

Note.—ZThe filing of the case against respondent being unfounded and maliciously prosecuted
satisfactorily proves the existence of the factual basis for moral damages and the causal relation to
petitioners’ acts. (De Leon vs. Court of Appeals, 165 SCRA 166.)

——o0o——

Lao vs. Court of Appeals, 199 SCRA 58, G.R. No. 82808 July 11, 1991