1
Preliminary Considerations: SOURCES OF OBLIGATIONS
CASE TITLE
Sagrada Orden de Predicadores
del Santisimo Rosario de Filipinas vs.
National Coconut Corporation
No. L-3756
June 30, 1952
Wherefore, that part of the
judgment appealed from, which
sentences defendant-appellant to
pay rentals from August, 1946, to
February 28, 1949, is hereby
reversed. In all other respects the
judgment is affirmed. Costs of this
appeal shall be against the
plaintiff-appellee.
DOCTRINE
WON National Coconut Corp is liable for rents. NO.
 We can not understand how the trial court, from the mere fact that
plaintiff-appellee was the owner of the property and the defendant-
appellant the occupant, which used it for its own benefit but by the
express permission of the Alien Property Custodian of the United
States, so easily jumped to the conclusion that the occupant is liable
for the value of such use and occupation.
 If defendant-appellant is liable at all, its obligations must arise from
any of the four sources of obigations, namely, law, contract or quasi-
contract, crime, or negligence.
 Defendantappellant is not guilty of any offense at all, because it
entered the premises and occupied it with the permission of the entity
which had the legal control and administration thereof, the Alien
Property Administration. Neither was there any negligence on its part.
There was also no privity (of contract or obligation) between the Alien
Property Custodian and the Taiwan Tekkosho, which had secured the
possession of the property from the plaintiffappellee by the use of
duress, such that the Alien Property Custodian or its permittee
(defendant-appellant) may be held responsible for the supposed
illegaࡉity of the occupation of the property by the said Taiwan
Tekkosho. The Alien Property Administration had the control and
administration of the property not as successor to the interests of the
enemy holder of the title, the Taiwan Tekkosho, but by express
provision of law
 Neither is it a trustee of the former owner, the plaintiff-appellee herein,
but a trustee of the Government of the United States, in its own right,
to the exclusion of, and against the claim or title of, the enemy owner.
 From August, 1946, when defendant-appellant took possession, to the
date of the judgment on February 28, 1948, the Alien Property
Administration had the absolute control of the property as trustee of
the Government of the United States, with power to dispose of it by
sale or otherwise, as though it were the absolute owner.
 Therefore, even if defendant-appellant were liable to the Alien
Property Administration for rentals, these would not accrue to the
benefit of the plaintiff-appellee, the old owner, but to the United
States Government.
 But there is another ground why the claim for rentals can not be made
against defendant-appellant. There
NOTES
 The land belongs to the plaintiff, in whose name the title
was registered before the war.
 1943, during the Japanese military occupation, the land
was acquired by a Japanese corporation by the name
of Taiwan Tekkosho for the sum of P140,000, and
thereupon title thereto issued in its name
 After liberation, the Alien Property Custodian of the
United States of America took possession, control, and
custody thereof under Trading with the Enemy Act for the
reason that it belonged to an enemy national.
 During the year 1946 the property was occupied by the
Copra Export Management Company under a
custodianship agreement with the United States Alien
Property Custodian and when it vacated the property it
was occupied by the defendant herein.
 Defendant leased one-third of the warehouse to one
Dioscoro Sarile at a monthly rental of P500, which was
later raised to P1,000 a month.
 Plaintiff made claim to the property before the Alien
Property Custodian of the United States, but as this was
denied, it brought an action in court (Court of First
Instance of Manila) to annul the sale of the property to
the Taiwan Tekkosho, and recover its possession. The
Republic of the Philippines was allowed to intervene in
the action. The case did not come for trial because the
parties presented a joint petition in which it is claimed by
plaintiff that the sale in favor of the Taiwan Tekkosho was
null and void because it was executed under threats,
duress, and intimidation, and it was agreed that the title
issued in the name of the Taiwan Tekkosho be cancelled
and the original title of plaintiff re-issued; that the claims,
rights, title, and interest of the Alien Property Custodian
be cancelled and held for naught; that the occupant
National Coconut Corporation has until February 28,
1949, to recover its equipment from the property and
vacate the premises; that plaintiff, upon entry of
judgment, pay to the Philippine Alien Property
Administration the sum of P140,000; and that the
Philippine Alien Property Administration be free from

 was no express agreement between the Alien Property Custodian and
the defendant-appellant for the latter to pay rentals on the property.
The existence of an implied agreement to that effect is contrary to the
circumstances. The Copra Export Management Company, which
preceded the defendant-appellant in the possession and use of the
property, does not appear to have paid rentals therefor, as it
occupied it by what the parties denominated a "custodianship
agreement," and there is no provision therein for the payment of
rentals or of any compensation for its custody and or occupation and
use. The Trading with the Enemy Act, as originally enacted, was purely
a measure of conservation, hence it is very unlikely that rentals were
demanded for the use of the property. When the National Coconut
Corporation succeeded the Copra Export Management Company in
the possession and use of the property, it must have been also free
from payment of rentals, especially as it was a Government
corporation, and steps were then being taken by the Philippine
Government to secure the property for the National Coconut
Corporation. So that the circumstances do not justify the finding that
there was an implied agreement that the defendant-appellant was to
pay for the use and occupation of the premises at all.
2
responsibility or liability for any act of the National
Coconut Corporation, etc.
 Pursuant to the agreement the court rendered judgment
releasing the defendant and the intervenor from liability,
but reserving to the plaintiff the right to recover from the
National Coconut Corporation reasonable rentals for the
use and occupation of the premises.
 The present action is to recover the reasonable rentals
from August, 1946, the date when the defendant began
to occupy the premises, to the date it vacated it. The
defendant does not contest its liability for the rentals at
the rate of P3,000 per month from February 28, 1949 but
resists the claim therefor prior to this date.
 Judgment was rendered for the plaintiff to recover from
the defendant the sum of P3,000 a month, as reasonable
rentals, from August, 1946, to the date the defendant
vacates the premises.
 Against this judgment this appeal has been interposed

CASE TITLE
Naguiat vs. National Labor
Relations Commission
G.R. No. 116123
March 13, 1997
WHEREFORE, the foregoing
premises considered, the petition
is PARTLY GRANTED. The assailed
February 28, 1994 Resolution of the
NLRC is hereby MODIFIED
CONCEPT OF TORTS
DOCTRINE
WON CFTI President is solidarily liable with CFTI. YES. Corporate Tort.
 The President of a corporation who actively manages the business falls
within the meaning of an “employer” as contemplated by the Labor
Code and may be held jointly and severally liable for the obligations
of the corporation to its dismissed employees.
 Stockholders who are actively engaged in the management or
operation of the business and affairs of a close corporation shall be
personally liable for corporate torts unless the corporation has
obtained reasonably adequate liability insurance.
 Our jurisprudence is wanting as to the definite scope of “corporate
tort.”
 The petition is partially meritorious.
 In impleading Naguiat Enterprises as solidarily liable for the obligations 
of CFTI, respondents rely on Labor Code.
 Based on factual submissions of the parties, the labor arbiter, however,
found that individual respondents were regular employees of CFTI who
received wages on a boundary or commission basis.
 From the evidence proffered by both parties, there is no substantial
basis to hold that Naguiat Enterprises is an indirect employer of
individual respondents much less a labor only contractor. On the
contrary, petitioners submitted documents such as the drivers’
applications for employment with CFTI, and social security remittances
and payroll of Naguiat Enterprises showing that none of the individual
respondents were its employees.
CFTI president solidarily liable
 Petitioner-corporations would likewise want to avoid the solidary
liability of their officers. To bolster their position, Sergio F. Naguiat and
Antolin T. Naguiat specifically aver that they were denied due process
since they were not parties to the complaint below.
 In the broader interest of justice, we, however, hold that Sergio F.
Naguiat, in his capacity as president of CFTI, cannot be exonerated
from joint and several liability in the payment of separation pay to
individual respondents.
 Sergio F. Naguiat, admittedly, was the president of CFTI who actively
managed the business. Thus, applying the ruling in A.C. Ransom, he
falls within the meaning of an “employer” as contemplated by the
3
NOTES
 Petitioner Clark Field Taxi, Inc. held a concessionaire’s
contract with the Army Air Force Exchange Services
(“AAFES”) for the operation of taxi services within Clark
Air Base.
 Sergio F. Naguiat was CFTI’s president, while Antolin T.
Naguiat was its vicepresident.
 Individual respondents were previously employed by CFTI
as taxicab drivers. During their employment, they were
required to pay a daily “boundary fee” in the amount of
US$26.50 for those working from 1:00 a.m. to 12:00 noon,
and US$27.00 for those working from 12:00 noon to 12:00
midnight. All incidental expenses for the maintenance of
the vehicles they were driving were accounted against
them, including gasoline expenses.
The drivers worked at least three to four times a week,
depending on the availability of taxicabs. They earned
not less than US$15.00 daily. In excess of that amount,
however, they were required to make cash deposits to
the company, which they could later withdraw every
fifteen days.
 Due to the phase-out of the US military bases in the
Philippines, from which Clark Air Base was not spared, the
AAFES was dissolved, and the services of individual
respondents were officially terminated on November 26,
1991.
 The AAFES Taxi Drivers Association (“drivers’ union”) and
CFTI held negotiations as regards separation benefits that
should be awarded in favor of the drivers. They arrived at
an agreement that the separated drivers will be given
P500.00 for every year of service as severance pay. Most
of the drivers accepted said amount
 However, individual respondents herein refused to
accept theirs.
 Instead, after disaffiliating themselves from the drivers’
union, individual respondents, through the National
Organization of Workingmen (“NOWM”), a labor
organization which they subsequently joined, filed a
complaint against “Sergio F. Naguiat doing business
under the name and style Sergio F. Naguiat Enterprises,
 4

Labor Code, who may be held jointly and severally liable for the Inc., Army-Air Force Exchange Services (AAFES) with Mark
obligations of the corporation to its dismissed employees. Hooper as Area Service Manager, Pacific Region, and
 Moreover, petitioners also conceded that both CFTI and Naguiat AAFES Taxi Drivers Association with Eduardo Castillo as
Enterprises were “close family corporations”34owned by the Naguiat President,” for payment of separation pay due to
family. termination/phase-out. Said complaint was later
 Section 100, paragraph 5, (under Title XII on Close Corporations) of the amended to include additional taxi drivers who were
Corporation Code, states: similarly situated as complainants, and CFTI with Antolin T.
“(5) To the extent that the stockholders are actively engage(d) in the Naguiat as vice president and general manager, as
management or operation of the business and affairs of a close party respondent.
corporation, the stockholders shall be held to strict fiduciary duties to  The labor arbiter, finding the individual complainants to
each other and among themselves. Said stockholders shall be personally be regular workers of CFTI, ordered the latter to pay them
liable for corporate torts unless the corporation has obtained reasonably P1,200.00 for every year of service “for humanitarian
adequate liability insurance.” consideration,” setting aside the earlier agreement
between CFTI and the drivers’ union of P500.00 for every
 Nothing in the records show whether CFTI obtained “reasonably year of service.
adequate liability insurance”; thus, what remains is to determine  Herein individual private respondents appealed to the
whether there was corporate tort. NLRC. In its Resolution, the NLRC modified the decision of
 Our jurisprudence is wanting as to the definite scope of “corporate the labor arbiter by granting separation pay to the
tort.” Essentially, “tort” consists in the violation of a right given or the private respondents.
omission of a duty imposed by law.  Hence, this petition
 Simply stated, tort is a breach of a legal duty.
 Article 283 of the Labor Code mandates the employer to grant
separation pay to employees in case of closure or cessation of
operations of establishment or undertaking not due to serious business
losses or financial reverses, which is the condition obtaining at bar.
CFTI failed to comply with this law-imposed duty or obligation.
Consequently, its stockholder who was actively engaged in the
management or operation of the business should be held personally
liable.
 As pointed out earlier, the fifth paragraph of Section 100 of the
Corporation Code specifically imposes personal liability upon the
stockholder actively managing or operating the business and affairs of
the close corporation.
 In fact, in posting the surety bond required by this Court for the
issuance of a temporary restraining order enjoining the execution of
the assailed NLRC Resolutions, only Sergio F. Naguiat, in his individual
and personal capacity, principally bound himself to comply with the
obligation thereunder, i.e., “to guarantee the payment to private
respondents of any damages which they may incur by reason of the
issuance of a temporary restraining order sought, if it should be finally
adjudged that said principals were not entitled thereto.”
 The Court here finds no application to the rule that a corporate officer

cannot be held solidarily liable with a corporation in the absence of
evidence that he had acted in bad faith or with malice.
 In the present case, Sergio Naguiat is held solidarily liable for
corporate tort because he had actively engaged in the
management and operation of CFTI, a close corporation.
Gashem Shookat Baksh vs. Court of WON Article 21 of the Civil Code applies to the case at bar. YES.
Appeals
G.R. No. 97336  The existing rule is that a breach of promise to marry per se is not an
February 19, 1993 actionable wrong.
 Article. 21 of the Civil Code designed to expand the concept of torts
WHEREFORE, finding no or quasi-delict in this jurisdiction grants adequate legal remedy for the
reversible error in the challenged untold number of moral wrongs which is impossible for human
decision, the instant petition is foresight to specifically enumerate and punish in the statute books.
hereby DENIED, with costs against  Damages pursuant to Article 21 may be awarded not because of
the petitioner. promise to marry but because of fraud and deceit behind it.
 It is petitioner's thesis that said Article 21 is not applicable because he
had not committed any moral wrong or injury or violated any good
custom or public policy; he has not professed love or proposed
marriage to the private respondent; and he has never maltreated
her.
 The existing rule is that a breach of promise to marry per se is not an
actionable wrong.
 Congress deliberately eliminated from the draft of the New Civil Code
the provisions that would have made it so.
 This notwithstanding, the said Code contains a provision, Article 21,
which is designed to expand the concept of torts or quasi-delict in this
jurisdiction by granting adequate legal remedy for the untold number
of moral wrongs which is impossible for human foresight to specifically
enumerate and punish in the statute books.
 Article 2176 of the Civil Code, which defines a quasi-delictthus:
"Whoever by act or omission causes damage to another, there being
fault or negligence, is obliged to pay for the damage done. Such fault or
negligence, if there is no pre-existing contractual relation between the
parties, is called a quasi-delict and is governed by the provisions of this
Chapter."
 is limited to negligent acts or omissions and excludes the notion of
willfulness or intent.
 Quasi-delict, known in Spanish legal treatises as culpa aquiliana, is a
civil law concept while torts is an Anglo-American or common law
5
 Private respondent MARILOU T. GONZALES without the
assistance of counsel, filed with the aforesaid trial court a
complaint for damages against the petitioner for the
alleged violation of their agreement to get married.
 She alleges in said complaint that:
1. she is twenty-two (22) years old, single, Filipino and a
pretty lass of good moral character and reputation
duly respected in her community;
2. petitioner, on the other hand, is an Iranian citizen
residing at the Lozano Apartments, Guilig, Dagupan
City, and is an exchange student taking a medical
course at the Lyceum Northwestern Colleges in
Dagupan City;
3. before 20 August 1987, the latter courted and
proposed to marry her; she accepted his love on the
condition that they would get married;
4. they therefore agreed to get married after the end of
the school semester, which was in October of that
year; petitioner then visited the private respondent's
parents in Bañaga, Bugallon, Pangasinan to secure
their approval to the marriage;
5. sometime in 20 August 1987, the petitioner forced her
to live with him in the Lozano Apartments; she was a
virgin before she began living with him; a week
before the filing of the complaint, petitioner's attitude
towards her started to change;
6. he maltreated and threatened to kill her; as a result
of such maltreatment, she sustained injuries; during a
confrontation with a representative of the barangay
captain of Guilig a day before the filing of the
complaint, petitioner repudiated their marriage
agreement and asked her not to live with him
anymore and; the petitioner is already married to
someone living in Bacolod City.
 Private respondent then prayed for judgment ordering
the petitioner to pay her damages in the amount of not

concept. Torts is much broader than culpa aquilianabecause it
includes not only negligence, but intentional criminal acts as well such
as assault and battery, false imprisonment and deceit.
 In the general scheme of the Philippine legal system envisioned by
the Commission responsible for drafting the New Civil Code,
intentional and malicious acts, with certain exceptions, are to be
governed by the Revised Penal Code while negligent acts or
omissions are to be covered by Article 2176 of the Civil Code.
 In between these opposite spectrums are injurious acts which, in the
absence of Article 21, would have been beyond redress. Thus, Article
21 fills that vacuum. It is even postulated that together with Articles 19
and 20 of the Civil Code, Article 21 has greatly broadened the scope
of the law on civil wrongs; it has become much more supple and
adaptable than the AngloAmerican law on torts.
 In the light of the above laudable purpose of Article 21, We are of the
opinion, and so hold, that where a man's promise to marry is in fact
the proximate cause of the acceptance of his love by a woman and
his representation to fulfill that promise thereafter becomes the
proximate cause of the giving of herself unto him in a sexual congress,
proof that he had, in reality, no intention of marrying her and that the
promise was only a subtle scheme or deceptive device to entice or
inveigle her to accept him and to obtain her consent to the sexual
act, could justify the award of damages pursuant to Article 21 not
because of such promise to marry but because of the fraud and
deceit behind it and the willful injury to her honor and reputation
which followed thereafter. It is essential, however, that such injury
should have been committed in a manner contrary to morals, good
customs or public policy.
 In the instant case, respondent Court found that it was the petitioner's
"fraudulent and deceptive protestations of love for and promise to
marry plaintiff that made her surrender her virtue and womanhood to
him and to live with him on the honest and sincere belief that he
would keep said promise, and it was likewise these fraud and
deception on appellant's part that made plaintiff s parents agree to
their daughter's living-in with him preparatory to their supposed
marriage."
 In short, the private respondent surrendered her virginity, the
cherished possession of every single Filipina, not because of lust but
because of moral seduction—the kind illustrated by the Code
Commission in its example earlier adverted to. The petitioner could
not be held liable for criminal seduction punished under either Article
337 or Article 338 of the Revised Penal Code because the private
6
less than P45,000.00, reimbursement for actual expenses
amounting to P600.00, attorney's fees and costs, and
granting her such other relief and remedies as may be
just and equitable.
 In his Answer with Counterclaim, petitioner claimed that
he never proposed marriage to or agreed to be married
with the private respondent; he neither sought the
consent and approval of her parents nor forced her to
live in his apartment; he did not maltreat her, but only
told her to stop coming to his place because he
discovered that she had deceived him by stealing his
money and passport; and finally, no confrontation took
place with a representative of the barangay captain.
 Insisting, in his Counterclaim, that the complaint is
baseless and unfounded and that as a result thereof, he
was unnecessarily dragged into court and compelled to
incur expenses, and has suffered mental anxiety and a
besmirched reputation, he prayed for an award of
P5,000.00 for miscellaneous expenses and P25,000.00 as
moral damages.
 After trial on the merits, the lower court, applying Article
21 of the Civil Code, rendered a decision favoring the
private respondent.
 The decision is anchored on the trial court's findings and
conclusions that:
1. by reason of that deceitful promise, private
respondent and her parents—in accordance with
Filipino customs and traditions-made some
preparations for the wedding that was to be held at
the end of October 1987 by looking for pigs and
chickens, inviting friends and relatives and
contracting sponsors, (f) petitioner did not fulfill his
promise to marry her
 Petitioner appealed the trial court's decision to the
respondent Court of Appeals
 On 18 February 1991, respondent Court promulgated the
challenged decision affirming in toto the trial court's
ruling
 Unfazed by his second defeat, petitioner filed the instant
petition.

Bacolod-Murcia Milling Co., Inc. vs.
First Farmers Milling Co., Inc.
No. L-29041
March 24, 1981
WHEREFORE, without resolving the
issue in the main case regarding
the alleged illegal creation and
operation of First Farmers Milling
Co., Inc., there having been no
presentation of evidence as yet in
the lower Court, the challenged
Order dismissing the Amended and
Supplemental Complaint against
defendants-appellees as well as
the Order denying reconsideration
thereof, is hereby affirmed, and the
appeal dismissed.
respondent was above eighteen (18) years of age at the time of the
seduction.
 Associate Justice Edgardo L. Paras, who recently retired from this
Court, opined that in a breach of promise to marry where there had
been carnal knowledge, moral damages may be recovered
 We are unable to agree with the petitioner's alternative proposition to
the effect that granting, for argument's sake, that he did promise to
marry the private respondent, the latter is nevertheless also at fault.
According to him, both parties are in pari delicto
 These statements reveal the true character and motive of the
petitioner. It is clear that he harbors a condescending, if not sarcastic,
regard for the private respondent on account of the latter's ignoble
birth, inferior educational background, poverty and, as perceived by
him, dishonorable employment. Obviously then, from the very
beginning, he was not at all moved by good faith and an honest
motive.
WON PNB and NIDC can ba held liable for tort. NO.
 A statement in the complaint that defendants are in bad faith does
not suffice to state a cause of action as it is a mere conclusion.
 Doing of an act, like extension of credit, which is lawful, does not
render one liable for tort simply because the act enables another to
accomplish a wrong.
 What appears from the record is that PNB and NIDC came into the
picture in the ordinary and usual course of its business after the
borrowing entity had established itself as capable of being treated as
a new milling district (FFMC) is officially designated as Mill District No,
49) because it could already operate and had its array of adhering
planters. “The doing of an act which is in itself is perfectly lawful will
not render one liable as for a tort, simply because the unintended
effect of such act is to enable or assist another person to do or
accomplish a wrong”, assuming, of course, that there was such a
wrong.
7
 Plaintiff-appellant had commenced an action for
Injunction and Prohibition with Damages against
defendants First Farmers Milling Co., Inc. (FFMC), various
named planters including those similarly situated, and
Ramon Nolan in his capacity as Administrator of the
Sugar Quota Administration.
 It was alleged That in the year 1964 he defendant First
Farmers Milling Co., Inc., established and operated a
sugar central known as the First Farmers Sugar Central
and for the crop years 1964-65 and 1965-66, the
defendants transferred their quota ‘A’ allotments to their
co-defendant First Farmers Milling Co., Inc. and are
actually milling their sugar with the said First Farmers
Milling Co., Inc., which illegal transfer has been made
over the vigorous protest and objections of the plaintiff,
but with the unwarranted, unjustified and likewise illegal
approval of their co-defendant the Sugar Quota
Administra-tion
 After the defendants FFMC, the adhering planters, and
the Sugar Quota Administrator had filed their respective
Answers, plaintiff-appellant filed a Motion to admit
Amended and Supplemental Complaint. As amended,
PNB and NIDC were included as new defendants in view
of the FFMC allegation in its Answer that the non-
inclusion of PNB and NICD as party defendants, “who
 8

became creditors of defendant FFMC central prior to

the institution of the instant case, and who therefore are
necessary parties, is fatal to the complaint.
 It was alleged this time That defendants NIDC and PNB
have extended loans to defendant sugar mill in the
amount of P12,210,000.00 and P4,000,000.00 to assist in
the illegal creation and operation of said mill, hence, a
joint tortfeasor in the trespass of plaintiff’s rights,
aggravated by the fact that defendant mill has only a
paid up capital stock of P500,000.00, hence, said loans
are far beyond the limits fixed by law
 As stated at the outset, the trial Court dismissed the
Amended and Supplemental Complaint against the PNB
and the NIDC after a preliminary hearing on the ground
of lack of cause of action.

CASE TITLE
Cinco vs. Canonoy
No. L-33171
May 31, 1979
WHEREFORE, granting the Writ of
Certiorari prayed for, the Decision
of the Court of First Instance of
Cebu sought to be reviewed is
hereby set aside, and the City
Court of Mandaue City, Cebu,
Branch II, is hereby ordered to
proceed with the hearing of Civil
Case No. 189 of that Court.
9
CONCEPT AND REQUISITE
DOCTRINE NOTES
 WON Judge CANONOY is correct in suspending the civil action  CINCO filed a complaint with City Court for the recovery
brought before the the City Court. NO. of damages on account of a vehicular accident
 Distinctions between criminal negligence and quasi-delict. involving his automobile and a jeepney
Firstly, the Revised Penal Code in Article 365 punishes not only reckless but  The jeepney was driven by HILOT and operated by
also simple imprudence. If we were to hold that Articles 1902 to 1910 of PEPITOs, (private respondents)
the Civil Code refer only to fault or negligence not punished by law,  Subsuquently, a criminal case was filed against the driver
according to the literal import of Article 1903 of the Civil Code, the legal arising from the same accident.
institution of culpa aquiliana would have very little scope and application  At the pre-trial in the civil case, counsel for private
in actual life. Death or injury to persons and damage to propertythrough respondents moved to suspend the civil action pending
any degree of negligence—even the slightest would have to be the final determination of the criminal suit, invoking Rule
indemnified only through the principle of civil liability arising from crime. x 111 of the Rules of Court
xx  The City Court ordered the suspension of the civil case.
 Petitioner elevated the matter on Certiorari to the Court
Secondly, to find the accused guilty in a criminal case, proof of guilt of First Instance
beyond reasonable doubt is required, while in civil case, preponderance  Respondent Judge dismissed the Petition for Certiorari on
of evidence is sufficient to make the defendant pay in damages. There the ground that there was no grave abuse of discretion
are numerous cases of criminal negligence which cannot be shown on the part of the City Court in suspending the civil
beyond reasonable doubt, but can be proved by a preponderance of action inasmuch as damage to property is not one of the
evidence. In such cases, the defendant can and should be made instances when an independent civil action is proper
responsible in a Civil action under Articles 1902 to 1910 of the Civil Code, Hence, this Petition for Review
otherwise, there would be many instances of unvindicated civil wrongs.
Ubi jus ibi remedium.

 From the Complaint filed by petitioner before the City Court of
Mandaue City, Cebu, it is evident that the nature and character of his
action was quasi-delictual, predicated principally on Articles 2176 and
2180 of the Civil Code
 Thus, plaintiff made the essential averments that it was the fault or
negligence of the driver, Romeo Hilot, in the operation of the jeepney
owned by the Pepitos which caused the collision between his
automobile and said jeepney; that damages were sustained by
petitioner because of the collision; that there was a direct causal
connection between the damages he suffered and the fault and
negligence of private respondents.
 Similarly, in the Answer, private respondents contended, among
others, that defendant, Valeriana Pepito, observed due diligence in
the selection and supervision of her employees, particularly of her co-
defendant Romeo Hilot, a defense peculiar to actions based
on quasi-delict.
 10

 Liability being predicated on quasi-delict, the civil case may proceed

as a separate and independent civil action, as specifically provided
for in Article 2177 of the Civil Code.
 “Art. 2177. Responsibility for fault or negligence under the preceding
article is entirely separate and distinct from the civil liability arising from
negligence under the Penal Code. But the plaintiff cannot recover
damages twice for the same act or omission of the defendant, (n)”
 The separate and independent civil action for a quasi-delictis also
clearly recognized in section 2, Rule 111 of the Rules of Court
 Tested by the hereinabove-quoted legal tenets, it has to be held that
the City Court, in suspending the civil action, erred in placing reliance
on section 3 (b) of Rule 111 of the Rules of Court, supra, which refers to
“other civil actions arising from cases not included in the section just
cited” (i.e. Section 2, Rule 111 above quoted), in which case “once
the criminal action has being commenced, no civil action arising from
the same offense can be prosecuted and the same shall be
suspended in whatever stage it may be found, until final judgment in
the criminal proceeding has been rendered.” Stated otherwise, the
civil action referred to in Secs. 3(a) and 3(b) of Rule 111 of the Rules of
Court, which should be suspended after the criminal action has been
instituted is that arising from the criminal offense not the civil action
based on quasi-delict.
 For obviously, the jural concept of a quasi-delict is that of an
independent source of obligation “not arising from the act or omission
complained of as a felony.”
 It bears emphasizing that petitioner’s cause of action is based
on quasi-delict. The concept of quasi-delict as enunciated in Article
2176 of the Civil Code (supra), is so broad that it includes not only
injuries to persons but also damage to property

Chan, Jr. vs. Iglesia ni Cristo, Inc. WON YORO should be held solely liable based on the MOA. NO.
G.R. No. 160283  The requisites of quasi-delict are the following: (a) there must be an
October 14, 2005 act or omission; (b) such act or omission causes damage to another;
(c) such act or omission is caused by fault or negligence; and (d)
there is no pre-existing contractual relation between the parties.
 The Aringay Shell Gasoline Station is owned by the
petitioner.
 It is bounded on the south by a chapel of the
respondent.
 The gasoline station supposedly needed additional

 The responsibility of two or more persons who are liable for a quasi-
delict is solidary. As a general rule, joint tortfeasors are all the persons
who command, instigate, promote, encourage, advise,
countenance, cooperate in, aid or abet the commission of a tort, or
who approve of it after it is done, if done for their benefit.
 Article 2176 of the New Civil Code provides:
ART. 2176.—Whoever by act or omission causes damage to another, there 
being fault or negligence, is obliged to pay for the damage done. Such
fault or negligence, if there is no pre-existing contractual relation between
the parties, is called a quasi-delict and is governed by the provisions of this
Chapter.
 Based on this provision of law, the requisites of quasi-delict are the
following:
a) there must be an act or omission;
b) such act or omission causes damage to another;
c) such act or commission is caused by fault or negligence; and
d) there is no pre-existing contractual relation between the parties.
 All the requisites are attendant in the instant case. The tortious act was
the excavation which caused damage to the respondent because it
was done surreptitiously within its premises and it may have affected
the foundation of the chapel. The excavation on respondent’s 
premises was caused by fault. Finally, there was no pre-existing
contractual relation between the petitioner and Yoro on the one 
hand, and the respondent on the other.
 For the damage caused to respondent, petitioner and Yoro are jointly
liable as they are joint tortfeasors. Verily, the responsibility of two or 
more persons who are liable for a quasidelict is solidary.
 The heavy reliance of petitioner in paragraph 4 of the MOA cited 
earlier cannot steer him clear of any liability.
 Indubitably, petitioner and Yoro cooperated in committing the tort.
They even had provisions in their MOA as to how they would divide the
treasure if any is found within or outside petitioner’s property line. Thus,
the MOA, instead of exculpating petitioner from liability, is the very
noose that insures that he be so declared as liable.
11
sewerage and septic tanks for its washrooms. In view of
this, the services of Dioscoro “Ely” Yoro (Yoro), a retired
general of the Armed Forces of the Philippines, was
procured by petitioner, as the former was allegedly a
construction contractor in the locality.
 Petitioner and Yoro executed a Memorandum of
Agreement
Diggings thereafter commenced. After some time,
petitioner was informed by the members of the
respondent that the digging traversed and penetrated a
portion of the land
 belonging to the latter.
 The foundation of the chapel was affected as a tunnel
was dug directly under it to the damage and prejudice
of the respondent.
 Complaint against petitioner was filed by the respondent
before the RTC
 After four years of hearing the case, the trial court
promulgated its Decision holding that the diggings were
not intended for the construction of sewerage and septic
tanks but were made to construct tunnels to find hidden
treasure.
The trial court adjudged the petitioner and Yoro solidarily
liable to the respondent
Petitioner filed a Notice of Appeal
 The petitioner’s appeal to the Court of Appeals, on the
other hand, was given due course.
Court of Appeals rendered its Decision denying the
appeal.
Petitioner instituted the instant case
 Petitioner avers that no liability should attach to him
by laying the blame solely on Yoro. Petitioner relies
heavily in Paragraph 4 of the MOA, which is again
reproduced hereunder:
4. Any damage within or outside the property of the FIRST
PARTY incurred during the digging shall be borne by the
SECOND PARTY.
 Respondent asserts that the MOA should not absolve
petitioner from any liability. This written contract,
according to the respondent, clearly shows that the
intention of the parties therein was to search for

American Express International, Inc.
vs. Cordero
G.R. No. 138550
October 14, 2005
WHEREFORE, the petition is
GRANTED. The assailed Decision of
the Court of Appeals in CA-G.R. CV
No. 51671 is REVERSED.
WON AMERICN EXPRESS can be held liable for damages. NO.
In order that an obligation based on quasi-delict may arise, there must be
no pre-existing contractual relation between the parties.
 In order that an obligation based on quasi-delict may arise, there
must be no pre-existing contractual relation between the parties. But
there are exceptions. There may be an action for quasi-delict
notwithstanding that there is a subsisting contract between the
parties. A liability for tort may arise even under a contract, where tort
is that which breaches the contract.
 Stated differently, when an act which constitutes a breach of
contract would have itself constituted the source of a quasi-delictual
liability, the contract can be said to have been breached by tort,
thereby allowing the rules on tort to apply.
 Furthermore, to constitute quasi-delict, the fault or negligence must
be the proximate cause of the damage or injury suffered by the
plaintiff. Proximate cause is that cause which, in natural and
continuous sequence, unbroken by any efficient intervening cause,
produces the injury and without which the result would not have
occurred.
According to the trial court, petitioner should have informed respondent
that a person in Hong Kong attempted to use a charge card bearing
similar number to that of respondent’s card; and that petitioner’s
inexcusable failure to do so is the proximate cause of the “confiscation
and cutting of [respondent’s] extension card which exposed the latter to
public humiliation for which [petitioner] should be held liable.”
 We cannot sustain the trial court’s conclusion.
 As explained by respondent himself, he could have used his card
upon verification by the sales clerk of Watson that indeed he is the
authorized cardholder. This could have been accomplished had
respondent talked to petitioner’s representative, enabling the latter to
12
hidden treasure. The alleged digging for a septic
tank was just a cover-up of their real intention.
 Petitioner is a foreign corporation that issues charge
cards to its customers, which the latter then use to
purchase goods and services at accredited merchants
worldwide.
 Nilda Cordero, wife of respondent Noel Cordero,
applied for and was issued an American Express charge
card.
 The issuance of the charge card was covered by an
Amex Cardmember Agreement. As cardholder, Nilda,
upon signing the back portion of the card, manifested
her acceptance of the terms of the Agreement.
 An extension charge card was likewise issued to
respondent Noel Cordero which he also signed
respondent, together with his wife, Nilda, daughter,
sisters-in-law and uncle-in-law, went on a three-day
holiday trip to Hong Kong.
 The group went to the Watson’s Chemist Shop
 Noel picked up some chocolate candies and handed to
the sales clerk his American Express extension charge
card to pay for his purchases. The sales clerk verified the
card by making a telephone call to the American
Express Office in Hong Kong.
 Moments later, Susan Chong, the store manager,
emerged from behind the counter and informed
respondent that she had to confiscate the card.
Thereupon, she cut respondent’s American Express card
in half with a pair of scissors. This, according to
respondent, caused him embarrassment and humiliation
considering that it was done in front of his family and the
other customers lined up at the check-out counter.
Hence, Nilda had to pay for the purchases using her
own American Express charge card.

determine that respondent is indeed the true holder of the card.
Clearly, no negligence which breaches the contract can be
attributed to petitioner. If at all, the cause of respondent’s humiliation
and embarrassment was his refusal to talk to petitioner’s
representative.
AS DISTINGUISH FROM A CRIME
CASE TITLE DOCTRINE
13
 When they returned to the Excelsior Hotel, Nilda called
up petitioner’s Office in Hong Kong.
 She was able to talk to Senior Authorizer Johnny Chen,
who informed her that on November 1, 1991, a person in
Hong Kong attempted to use a charge card with the
same number as respondent’s card.
 The Hong Kong American Express Office called up
respondent and after determining that he was in Manila
and not in Hong Kong, placed his card in the “Inspect
Airwarn Support System.” This is the system utilized by
petitioner as a protection both for the company and the
cardholders against the fraudulent use of their charge
cards.
 When the Watson’s sales clerk called up petitioner’s
Hong Kong Office, its representative said he wants to
talk to re-spondent in order to verify the latter’s identity
 However, respondent refused. Consequently, petitioner’s
representative was unable to establish the identity of the
cardholder
 Respondent filed with the Regional Trial Court a
complaint for damages against petitioner
 He prayed for the award of moral damages and
exemplary damages, as well as attorney’s fees as a
result of the humiliation he suffered.
 The trial court found that petitioner should be held liable.
 Upon appeal, the Court of Appeals rendered the
assailed Decision affirming the trial court’s Decision
 Hence, the instant petition
 In his complaint, respondent claimed that he
suffered embarrassment and humiliation because his
card was unceremoniously confiscated and cut in
half by Susan Chong of Watson’s Chemist Shop.
 Respondent anchors his cause of action on the Art.
2176 of the Civil Code
NOTES

Manliclic vs. Calaunan
G.R. No. 150157
January 25, 2007
WHEREFORE, premises considered,
the instant petition for review is
DENIED. The decision of the Court
of Appeals in CA-G.R. CV No. 55909
is AFFIRMED with the MODIFICATION
that (1) the award of moral
damages shall be reduced to
P50,000.00; and (2) the award of
exemplary damages shall be
lowered to P50,000.00. Costs
against petitioners.
WON the acquittal of MANLILIC bars the claim for damages. NO.
 The extinction of civil liability referred to Section 2(b) of Rule 111, refers
exclusively to civil liability founded on Article 100 of the Revised Penal
Code, whereas the civil liability for the same act considered as a
quasidelict only and not as a crime is not extinguished even by a
declaration in the criminal case that the criminal act charged has not
happened or has not been committed by the accused.
 A quasi-delict or culpa aquiliana is a separate legal institution under
the Civil Code with a substantivity all its own, and individuality that is
entirely apart and independent from a delict or crime—a distinction
exists between the civil liability arising from a crime and the
responsibility for quasi-delicts or culpa extracontractual; It is now
settled that acquittal of the accused, even if based on a finding that
he is not guilty, does not carry with it the extinction of the civil liability
based on quasi-delict.
 From the foregoing declaration of the Court of Appeals, it appears
that petitioner Manliclic was acquitted not on reasonable doubt, but
on the ground that he is not the author of the act complained of.
 In spite of said ruling, petitioner Manliclic can still be held liable for the
mishap. The afore-quoted section applies only to a civil action arising
from crime or ex delicto and not to a civil action arising from quasi-
delict or culpa aquiliana.
 The extinction of civil liability referred to in Par. (e) of Section 3, Rule
111 [now Section 2 (b) of Rule 111], refers exclusively to civil liability
founded on Article 100 of the Revised Penal Code, whereas the civil
liability for the same act considered as a quasi-delict only and not as
a crime is not extinguished even by a declaration in the criminal case
that the criminal act charged has not happened or has not been
committed by the accused.
 A quasi-delict or culpa aquiliana is a separate legal institution under
the Civil Code with a substantivity all its own, and individuality that is
entirely apart and independent from a delict or crime—a distinction
exists between the civil liability arising from a crime and the
responsibility for quasi-delicts or culpa extra-contractual. The same
14
 The vehicles involved in this case are: (1) Philippine
Rabbit Bus owned by petitioner PRBLI and driven by
petitioner Manliclic; and (2) owner-type jeep owned by
respondent Calaunan and driven by Mendoza.
 At around 6:00 to 7:00 o’clock in the morning,
respondent Calaunan, together with
 Mendoza, was on his way to Manila from Pangasinan on
board his owner-type jeep. The Philippine Rabbit Bus was
likewise bound for Manila
 At the North Luzon Expressway, the two vehicles collided.
The front right side of the Philippine Rabbit Bus hit the rear
left side of the jeep causing the latter to move to the
shoulder on the right and then fall on a ditch with water
resulting to further extensive damage.
 Respondent suffered minor injuries while his driver was
unhurt. He was first brought for treatment to the Manila
Central University Hospital by Oscar Buan, the conductor
of the Philippine Rabbit Bus, and was later transferred to
the Veterans Memorial Medical Center.
 By reason of such collision, a criminal case was filed
before the RTC charging petitioner Manliclic with
Reckless Imprudence Resulting in Damage to Property
with Physical Injuries
 Respondent filed a complaint for damages against
petitioners Manliclic and PRBLI before the RTC
 The criminal case was tried ahead of the civil case.
 The trial court rendered its decision in favor of respondent
Calaunan and against petitioners Manliclic and PRBLI.
 Petitioners appealed the decision via Notice of Appeal
to the Court of Appeals.
 Court of Appeals, finding no reversible error in the
decision of the trial court, affirmed it in all respects
 Petitioners are now before us by way of petition for
review assailing the decision of the Court of Appeals.
 Petitioners informed this Court of a Decision of the Court
 15

negligence causing damages may produce civil liability arising from a of Appeals acquitting petitioner Manliclic of the charge
crime under the Penal Code, or create an action for quasi-delicts of Reckless Imprudence Resulting in Damage to Property
or culpa extra-contractualunder the Civil Code. with Physical Injuries
 It is now settled that acquittal of the accused, even if based on a  To be resolved by the Court is the effect of petitioner
finding that he is not guilty, does not carry with it the extinction of the Manliclic’s acquittal in the civil case.
civil liability based on quasi delict.
 In other words, if an accused is acquitted based on reasonable doubt
on his guilt, his civil liability arising from the crime may be proved by
preponderance of evidence only. However, if an accused is
acquitted on the basis that he was not the author of the act or
omission complained of (or that there is declaration in a final
judgment that the fact from which the civil might arise did not exist),
said acquittal closes the door to civil liability based on the crime or ex
delicto.
 In this second instance, there being no crime or delict to speak of,
civil liability based thereon or ex delicto is not possible. In this case, a
civil action, if any, may be instituted on grounds other than
the delictcomplained of.
 As regards civil liability arising from quasi-delict or culpa aquiliana,
same will not be extinguished by an acquittal, whether it be on
ground of reasonable doubt or that accused was not the author of
the act or omission complained of (or that there is declaration in a
final judgment that the fact from which the civil liability might arise did
not exist).
 The responsibility arising from fault or negligence in a quasi-delict is
entirely separate and distinct from the civil liability arising from
negligence under the Penal Code.
 An acquittal or conviction in the criminal case is entirely irrelevant in
the civil case based on quasi-delict or culpa aquiliana.

AS DISTINGUISH FROM BREACH OF CONTRACT

CASE TITLE DOCTRINE NOTES


Saludaga vs. Far Eastern University WON FEU can be held liable:  Petitioner Joseph Saludaga was a sophomore law

G.R. No. 179337
April 30, 2008
WHEREFORE, the petition is
GRANTED. The June 29, 2007
Decision of the Court of Appeals in
CA-G.R. CV No. 87050 nullifying the
Decision of the trial court and
dismissing the complaint as well as
the August 23, 2007 Resolution
denying the Motion for
Reconsideration are REVERSED and
SET
ASIDE. The Decision of the Regional
Trial Court of Manila, Branch 2, in
Civil Case No. 98-89483 finding
respondent FEU liable for damages
for breach of its obligation to
provide students with a safe and
secure learning atmosphere, is
AFFIRMED with MODIFICATIONS
 for breach of contract. YES.
 for quasi-delict based on 2180 (employer’s liability). NO.
 Where a student is enrolled in an educational institution, there is
created a contractual obligation between the two parties—the
student is obliged to comply with the rules and regulations of the
school while the latter, as a learning institution, is mandated to impart
knowledge and equip its students with the necessary skills to pursue
higher education or a profession, as well as to ensure and take
adequate steps to maintain peace and order within the campus.
 An act of God cannot be invoked to protect a person who has failed
to take steps to forestall the possible adverse consequences of such a
loss.
 For breach of contract due to negligence in providing a safe learning
environment, an educational institution is liable to petitioner for
damages.
 Trial courts must guard against the award of exorbitant damages;
they should exercise balanced, restrained and measured objectivity
to avoid suspicion that it was due to passion, prejudice, or corruption
on the part of the trial court.
 It is settled that in culpa contractual, the mere proof of the existence
of the contract and the failure of its compliance justify, prima facie, a 
corresponding right of relief.
 In the instant case, we find that, when petitioner was shot inside the
campus by no less the security guard who was hired to maintain
peace and secure the premises, there is a prima facie showing that
respondents failed to comply with its obligation to provide a safe and
secure environment to its students.
 In order to avoid liability, however, respondents aver that the shooting
incident was a fortuitous event because they could not have
reasonably foreseen nor avoided the accident caused by Rosete as
he was not their employee; and that they complied with their
obligation to ensure a safe learning environment for their students by
having exercised due diligence in selecting the security services of
Galaxy.
 After a thorough review of the records, we find that respondents
failed to discharge the burden of proving that they exercised due
diligence in providing a safe learning environment for their students.
They failed to prove that they ensured that the guards assigned in the
campus met the requirements stipulated in the Security Service
Agreement. Indeed, certain documents about Galaxy were
16
student of respondent Far Eastern University (FEU) when
he was shot by Alejandro Rosete (Rosete), one of the
security guards on duty at the school premises
 Petitioner was rushed to FEU-Dr. Nicanor Reyes Medical
Foundation (FEU-NRMF) due to the wound he sustained.
 Meanwhile, Rosete was brought to the police station
where he explained that the shooting was accidental.
He was eventually released considering that no formal
complaint was filed against him.
 Petitioner thereafter filed a complaint for damages
against respondents on the ground that they breached
their obligation to provide students with a safe and
secure environment and an atmosphere conducive to
learning.
 Respondents, in turn, filed a Third-Party Complaint
against the agency contracted to provide security
services within its premises to indemnify them for
whatever would be adjudged in favor of petitioner, if
any trial court rendered a decision in favor of petitioner
 Respondents appealed to the Court of Appeals which
GRANTED the appeal
Hence, the instant petition
Petitioner is suing respondents for damages based on the
alleged breach of student-school contract for a safe
learning environment.
 17

presented during trial; however, no evidence as to the qualifications

of Rosete as a security guard for the university was offered.
 Respondents also failed to show that they undertook steps to
ascertain and confirm that the security guards assigned to them
actually possess the qualifications required in the Security Service
Agreement.
 Consequently, respondents’ defense of force majeuremust fail. In
order for force majeure to be considered, respondents must show
that no negligence or misconduct was committed that may have
occasioned the loss. An act of God cannot be invoked to protect a
person who has failed to take steps to forestall the possible adverse
consequences of such a loss.
 One’s negligence may have concurred with an act of God in
producing damage and injury to another; nonetheless, showing that
the immediate or proximate cause of the damage or injury was a
fortuitous event would not exempt one from liability. When the effect
is found to be partly the result of a person’s participation—whether by
active intervention, neglect or failure to act—the whole occurrence is
humanized and removed from the rules applicable to acts of God.
 Article 1170 of the Civil Code provides that those who are negligent in
the performance of their obligations are liable for damages.
 Accordingly, for breach of contract due to negligence in providing a
safe learning environment, respondent FEU is liable to petitioner for
damages. It is essential in the award of damages that the claimant
must have satisfactorily proven during the trial the existence of the
factual basis of the damages and its causal connection to
defendant’s acts.
 In the instant case, it was established that petitioner spent P35,298.25
for his hospitalization and other medical expenses.

 Incidentally, although the main cause of action in the instant case is

the breach of the school-student contract, petitioner, in the
alternative, also holds respondents vicariously liable under Article 2180
of the Civil Code
 We agree with the findings of the Court of Appeals that respondents
cannot be held liable for damages under Art. 2180 of the Civil Code
because respondents are not the employers of Rosete. The latter was
employed by Galaxy. The instructions issued by respondents’ Security
Consultant to Galaxy and its security guards are ordinarily no more
than requests commonly envisaged in the contract for services
entered into by a principal and a security agency. They cannot be
construed as the element of control as to treat respondents as the
 18

employers of Rosete.

RADIO COMMUNICATIONS 
OF THE PHILIPPINES, INC. 
(RCPI), 
petitioner, vs. ALFONSO
VERCHEZ, GRACE
VERCHEZ-INFANTE,
MARDONIO INFANTE,
ZENAIDA VER-CHEZ-
CATIBOG, AND
FORTUNATO CATIBOG,
respondents
G.R. No. 164349. January 31,
2006
Air France vs. Carrascoso WON AIR FRANCE can be held liable for damages due to act of  RAFAEL CARRASCOSO, plaintiff, a civil engineer, was a
No. L-21438 employee. YES. member of a group of 48 Filipino pilgrims that left Manila
September 28, 1966  A written document speaks a uniform language; the spoken word for Lourdes
could be notoriously unreliable. If only to achieve stability in the  Defendant, Air France, through its authorized agent,
We accordingly vote to affirm the relations between passenger and air carrier, adherence to the terms Philippine Air Lines, Inc., issued to plaintiff a 'first class'
same. Costs against petitioner. So of a ticket is desirable. round trip airplane ticket from Manila to Rome. From
ordered  First,That there was a contract to furnish plaintiff a first class passage Manila to Bangkok, plaintiff travelled in 'first class', but at
covering, amongst others, the BangkokTeheran leg; Second, That said Bangkok, the Manager of the defendant airline forced
contract was breached when petitioner failed to furnish first class plaintiff to vacate the 'first class' seat that he was
transportation at Bangkok; and Third, That there was bad faith when occupying because there was a 'white man', who, the
petitioner's employee compelled Carrascoso to leave his first class Manager alleged, had a 'better right' to the seat.
accommodation berth "after he was already seated" and to take a  When asked to vacate his 'first class' seat, the plaintiff, as
seat in the tourist class, by reason of which he suffered was to be expected, refused, and told defendant's
inconvenience, embarrassments and humiliations, thereby causing Manager that his seat would be taken over his dead
him mental anguish, serious anxiety, wounded feelings and social body; a commotion ensued, and many of the Filipino
humiliation, resulting in moral damages. passengers got nervous in the tourist class; when they
 It is true that there is no specific mention of the term bad faith in the found out that Mr. Carrascoso was having a hot
complaint. But, the inference of bad faith is there, it may be drawn discussion with the white man [manager], they came all
from the facts and circumstances set forth therein. across to Mr. Carrascoso and pacified Mr. Carrascoso to
 The manager not only prevented Carrascoso from enjoying his right to give his seat to the white man and plaintiff reluctantly
 19

a first class seat; worse, he imposed his arbitrary will; he forcibly gave his 'first class' seat. in the plane.
ejected him from his seat, made him suffer the humiliation of having  Court of First Instance of Manila sentenced petitioner to
to go to the tourist class compartment—just to give way to another pay Carrascoso
passenger whose right thereto has not been established. Certainly,  On appeal, the Court of Appeals voted to affirm the
this is bad faith. Unless, of course, bad faith has assumed a meaning appealed decision "in all other respects''
different from what is understood in law. For, "bad faith" contemplates  The case is now before us for review on certiorari
a "state of mind affirmatively operating with furtive design or with
some motive of self-interest or ill will or for ulterior purpose, " Petitioner's trenchant claim is that Carrascoso's action is
 The responsibility of an employer for the tortious act of its employees planted upon breach of contract; that to authorize an
need not be essayed. It is well settled in law. award for moral damages there must be an averment of
 For the willful malevolent act of petitioner's manager, petitioner, his fraud or bad faith; and that the decision of the Court of
employer, must answer. Article 21 of the Civil Code says: Appeals fails to make a finding of bad faith
"ART. 21. Any person who wilfully causes loss or injury to another in a
manner that is contrary to morals, good customs or public policy shall
compensate the latter for the damage."
 In parallel circumstances, we applied the foregoing legal precept;
and, we held that upon the provisions of Article 2219 (10), Civil Code,
moral damages are recoverable.