Republic of the Philippines
SUPREME COURT his three companions.
Manila
FIRST DIVISION
G.R. No. L-50076 September 14, 1990
NORBERTO QUISUMBING, SR., and GUNTHER
LOEFFLER petitioners,
vs.
COURT OF APPEALS and PHILIPPINE AIR LINES,
INC., respondents.
N.J. Quisumbing & Associates for petitioners
Siguion Reyna, Montecillo & Ongsiako for private respondent.
NARVASA, J.:
Having met with no success in the Court of First Instance of Rizal
and in the Court of Appeals, the petitioners are now in this Court in a
third and final attempt to recover from the Philippine Airlines, Inc.
(hereafter, simply PAL) the value of jewelry, other valuables and
money taken from them by four (4) armed robbers on board one of
the latter's airplanes while on a flight from Mactan City to Manila, as
well as moral and exemplary damages, attorney's fees and expenses
of litigation.
The petitioners accept the correctness of the basic facts adopted by
the Court of Appeals from the judgment of the Court of First Instance,
to wit: 1
1. . . . Norberto Quisumbing, Sr. and Gunther
Leoffler were among the of ... (PAL's) Fokker
'Friendship' PIC-536 plane in its flight of
November 6,1968 which left Mactan City at about
7:30 in the evening with Manila for its destination.
2. After the plane had taken off, Florencio O.
Villarin, a Senior NBI Agent who was also a
passenger of the said plane, noticed a certain
'Zaldy,' a suspect in the killing of Judge Valdez,
seated at the front seat near the door leading to
the cockpit of the plane. A check by Villarin with
the passenger's ticket in the possession of flight
Stewardess Annie Bontigao, who was seated at
the last seat right row, revealed that 'Zaldy' had
used the name 'Cardente,' one of his aliases
known to Villarin. Villarin also came to know from
the stewardess that 'Zaldy' had three companions
on board the plane."
3. Villarin then scribbled a note addressed to the
pilot of the plane requesting the latter to contact
NBI duty agents in Manila for the said agents to
ask the Director of the NBI to send about six NBI
agents to meet the plane because the suspect in
the killing of Judge Valdez was on board (Exh.
'G'). The said note was handed by Villarin to the
stewardess who in tum gave the same to the
pilot.
4. After receiving the note, which was about 15
minutes after take off, the pilot of the plane, Capt.
Luis Bonnevie, Jr., came out of the cockpit and
sat beside Villarin at the rear portion of the plane
and explained that he could not send the
message because it would be heard by all
ground aircraft stations. Villarin, however, told the
pilot of the danger of commission of violent acts
on board the plane by the notorious 'Zaldy' and
5. While the pilot and Villarin were talking, 'Zaldy'
and one of his companions walked to the rear
and stood behind them. Capt. Bonnevie then
stood up and went back to the cockpit. 'Zaldy'
and his companions returned to their seats, but
after a few minutes they moved back to the rear
throwing ugly looks at Villarin who, sensing
danger, stood up and went back to his original
seat across the aisle on the second to the last
seat near the window. 'Zaldy and his companion
likewise went back to their respective seats in
front.
6. Soon thereafter an exchange of gunshots
ensued between Villarin and 'Zaldy' and the
latter's companions. 'Zaldy' announced to the
passengers and the pilots in the cockpit that it
was a hold-up and ordered the pilot not to send
any SOS. The hold-uppers divested passengers
of their belongings.
7. Specifically, ... Norberto Quisumbing, Sr. was
divested of jewelries and cash in the total amount
of P18,650.00 out of which recoveries were made
amounting to P4,550.00. . . Gunther Leoffler was
divested of a wrist watch, cash and a wallet in the
total of P1,700.00. As a result of the incident ...
Quisumbing, Sr.suffered shock, because a gun
had been pointed at him by one of the
holduppers.
8. Upon landing at the Manila International
Airport. 'Zaldy' and his three companions
succeeded in escaping.
Demands were thereafter made on PAL by Quisumbing and Loeffler
"to indemnify ... (them) on their aforesaid loss, but ... (PAL) refused ...
(averring that) it is not liable to (them) in law or in fact."2
Contending that the "aforesaid loss is a result of breach of ... (PAL's)
contractual obligation to carry ... (them) and their belongings and
effects to their Manila destination without loss or damage, and
constitutes a serious dereliction of ... (PAL's) legal duty to exercise
extraordinary diligence in the vigilance over the same." , Quisumbing
and Loeffler brought suit against PAL in the Court of First Instance of
Rizal, as stated in this opinion's opening paragraph, to recover the
value of the property lost by them to the robbers as well as moral and
exemplary damages, attorney's fees and expenses of litigation. 3 The
plaintiffs declared that their suit was instituted "... pursuant to Civil
Code articles 1754, 998, 2000 and 2001 and on the ground that in
relation to said Civil Code article 2001 the complained-of act of the
armed robbers is not a force majeure, as the 'use of arms' or
'irresistible force' was not taken advantage of by said armed robbers
in gaining entrance to defendant's ill-fated plane in questions. And,
with respect to said Civil Code article 1998, it is not essential that the
lost effects and belongings of plaintiffs were actually delivered to
defendant's plane personnel or that the latter were notified thereof
(De los Santos v. Tamn Khey, [CA] 58 O.G. 7693)."4
PAL filed answer denying liability, alleging inter alia that the robbery
during the flight and after the aircraft was forcibly landed at the
Manila Airport did indeed constitute force majeure, and neither of the
plaintiffs had notified PAL "or its crew or employees that they were in
possession of cash, German marks and valuable jewelries and
watches" or surrendered said items to "the crew or personnel on
board the aircraft."5
After trial, the Court of First Instance rendered judgment 'dismissing
plaintiffs' complaint with costs against ... (them)." 6 The Court opined
that since the plaintiffs "did not notify defendant or its employees that
they were in possession of the cash, jewelries, and the wallet they
are now claiming," the very provision of law invoked by them, Article
1998 of the Civil Code, denies them any recourse against PAL. The
Court also pointed out that-
... while it is true that the use of gems was not
taken advantage of by the robbers in gaining
entrance to defendant's ill-fated plane, the armed
robbery that took place constitutes force
majeure for which defendant is not liable because
the robbers were able to gain entrance to the
plane with the guns they used already in their
possession, which fact could not have been
prevented nor avoided by the defendant since it
was not authorized to search its passengers for
firearms and deadly weapons as shown in
Exhibits '6', '7', '8,' and '8-A.' As its robbery
constitutes force majeure, defendant is not liable.
The plaintiffs appealed to the Court of Appeals.7 The Court affirmed
the trial court's judgment.8 It rejected the argument that "the use of
arms or ... irresistible force" referred to in Article 2001
constitutes force majeure only if resorted to gain entry into the
airplane, and not if it attends "the robbery itself." The Court ruled that
under the facts, "the highjacking-robbery was force majeure,"
observing that —
... hijackers do not board an airplane through a
blatant display of firepower and violent fury.
Firearms, hand-grenades, dynamite, and
explosives are introduced into the airplane
surreptitiously and with the utmost cunning and
stealth, although there is an occasional use of
innocent hostages who will be coldly murdered
unless a plane is given to the hijackers' complete
disposal. The objective of modern-day hijackers
is to display the irresistible force amounting to
force majeure only when it is most effective and
that is when the jetliner is winging its way at
Himalayan altitudes and ill-advised heroics by
either crew or passengers would send the multi-
million peso airplane and the priceless lives of all
its occupants into certain death and destruction.
...
The Appellate Court also ruled that in light of the evidence PAL could
not be faulted for want of diligence, particularly for failing "to take
positive measures to implement Civil Aeronautics Administration
regulations prohibiting civilians from carrying firearms on board
aircrafts;" and that "the absence of coded transmissions, the
amateurish behaviour of the pilot in dealing with the NBI agent, the
allegedly open cockpit door, and the failure to return to Mactan, in the
light of the circumstances of the case ..., were not negligent acts
sufficient to overcome the force majeure nature of the armed
robbery." In fact, the Court went on to says, 9
... it is illusive to assume that had these
precautions been taken, the hijacking or the
robbery would not have succeeded. The
mandatory use of the most sophisticated
electronic detection devices and magnetometers,
the imposition of severe penalties, the
development of screening procedures, the
compilation of hijacker behavioural profiles, the
assignment of sky marshals, and the weight of
outraged world opinion may have minimized
hijackings but all these have proved ineffective
against truly determined hijackers. World
experience shows that if a group of armed
hijackers want to take over a plane in flight, they
can elude the latest combined government and
airline industry measures. And as our own
experience in Zamboanga City illustrates, the use
of force to overcome hijackers, results in the
death and injury of innocent passengers and
crew members. We are not in the least bit
suggesting that the Philippine Airlines should not
do everything humanly possible to protect
passengers from hijackers' acts. We merely state
that where the defendant has faithfully complied
with the requirements of government agencies
and adhered to the established procedures and
precautions of the airline industry at any
particular time, its failure to take certain steps
that a passenger in hindsight believes should
have been taken is not the negligence or
misconduct which mingles with force majeure as
an active and cooperative cause.
Under the circumstance of the instant case, the
acts of the airline and its crew cannot be faulted
as negligence. The hijackers had already shown
their willingness to kill. One passenger was in
fact killed and another survived gunshot wounds.
The lives of the rest of the passengers and crew
were more important than their properties.
Cooperation with the hijackers until they released
their hostages at the runway end near the South
Superhighway was dictated by the
circumstances.
Insisting that the evidence demonstrates negligence on the part of
the PAL crew "occurring before and exposing them to hijacking,"
Quisumbing and Loeffler have come up to this Court praying that the
judgments of the trial Court and the Court of Appeals be reversed
and another rendered in their favor. Once again, the issue will be
resolved against them.
A careful analysis of the record in relation to the memoranda and
other pleadings of the parties, convinces this Court of the correctness
of the essential conclusion of both the trial and appellate courts that
the evidence does indeed fail to prove any want of diligence on the
part of PAL, or that, more specifically, it had failed to comply with
applicable regulations or universally accepted and observed
procedures to preclude hijacking; and that the particular acts singled
out by the petitioners as supposedly demonstrative of negligence
were, in the light of the circumstances of the case, not in truth
negligent acts "sufficient to overcome the force majeure nature of the
armed robbery." The Court quite agrees, too, with the Appellate
Tribunal's wry observation that PAL's "failure to take certain steps
that a passenger in hindsight believes should have been taken is not
the negligence or misconduct which mingles with force majeure as an
active and cooperative cause."
No success can therefore attend petitioners' appeal, not only
because they wish to have a review and modification of factual
conclusions of the Court of Appeals, which established and uniformly
observed axiom proscribes, 10 but also because those factual
conclusions have in this Court's view been correctly drawn from the
proofs on record.
WHEREFORE, the petition is DENIED and the appealed Decision of
the Court of Appeals is AFFIRMED, with costs against petitioners.
SO ORDERED.
Cruz, Gancayco, Griño-Aquino and Medialdea, JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-20761 July 27, 1966
LA MALLORCA, petitioner,
vs.
HONORABLE COURT OF APPEALS, MARIANO BELTRAN, ET
AL., respondents.
G. E. Yabut, R. Monterey and M.C. Lagman for petitioner.
Ahmed Garcia for respondents.
BARRERA, J.:
La Mallorca seeks the review of the decision of the Court of Appeals
in CA-G.R. No. 23267-R, holding it liable for quasi-delict and ordering
it to pay to respondents Mariano Beltran, et al., P6,000.00 for the
death of his minor daughter Raquel Beltran, plus P400.00 as actual
damages.
The facts of the case as found by the Court of Appeals, briefly are:
On December 20, 1953, at about noontime, plaintiffs,
husband and wife, together with their minor daughters,
namely, Milagros, 13 years old, Raquel, about 4½ years
old, and Fe, over 2 years old, boarded the Pambusco Bus
No. 352, bearing plate TPU No. 757 (1953 Pampanga),
owned and operated by the defendant, at San Fernando,
Pampanga, bound for Anao, Mexico, Pampanga. At the
time, they were carrying with them four pieces of baggages
containing their personal belonging. The conductor of the
bus, who happened to be a half-brother of plaintiff Mariano
Beltran, issued three tickets (Exhs. A, B, & C) covering the
full fares of the plaintiff and their eldest child, Milagros. No
fare was charged on Raquel and Fe, since both were below
the height at which fare is charged in accordance with the
appellant's rules and regulations.
After about an hour's trip, the bus reached Anao whereat it
stopped to allow the passengers bound therefor, among
whom were the plaintiffs and their children to get off. With
respect to the group of the plaintiffs, Mariano Beltran, then
carrying some of their baggages, was the first to get down
the bus, followed by his wife and his children. Mariano led
his companions to a shaded spot on the left pedestrians
side of the road about four or five meters away from the
vehicle. Afterwards, he returned to the bus in controversy
to get his other bayong, which he had left behind, but in so
doing, his daughter Raquel followed him, unnoticed by her
father. While said Mariano Beltran was on the running
board of the bus waiting for the conductor to hand him
his bayong which he left under one of its seats near the
door, the bus, whose motor was not shut off while
unloading, suddenly started moving forward, evidently to
resume its trip, notwithstanding the fact that the conductor
has not given the driver the customary signal to start, since
said conductor was still attending to the baggage left
behind by Mariano Beltran. Incidentally, when the bus was
again placed into a complete stop, it had travelled about
ten meters from the point where the plaintiffs had gotten
off.
Sensing that the bus was again in motion, Mariano Beltran
immediately jumped from the running board without getting
his bayong from the conductor. He landed on the side of
the road almost in front of the shaded place where he left
his wife and children. At that precise time, he saw people
beginning to gather around the body of a child lying
prostrate on the ground, her skull crushed, and without life.
The child was none other than his daughter Raquel, who
was run over by the bus in which she rode earlier together
with her parents.
For the death of their said child, the plaintiffs commenced
the present suit against the defendant seeking to recover
from the latter an aggregate amount of P16,000 to cover
moral damages and actual damages sustained as a result
thereof and attorney's fees. After trial on the merits, the
court below rendered the judgment in question.
On the basis of these facts, the trial court found defendant liable for
breach of contract of carriage and sentenced it to pay P3,000.00 for
the death of the child and P400.00 as compensatory damages
representing burial expenses and costs.
On appeal to the Court of Appeals, La Mallorca claimed that there
could not be a breach of contract in the case, for the reason that
when the child met her death, she was no longer a passenger of the
bus involved in the incident and, therefore, the contract of carriage
had already terminated. Although the Court of Appeals sustained this
theory, it nevertheless found the defendant-appellant guilty of quasi-
delict and held the latter liable for damages, for the negligence of its
driver, in accordance with Article 2180 of the Civil Code. And, the
Court of Appeals did not only find the petitioner liable, but increased
the damages awarded the plaintiffs-appellees to P6,000.00, instead
of P3,000.00 granted by the trial court.
In its brief before us, La Mallorca contends that the Court of Appeals
erred (1) in holding it liable for quasi-delict, considering that
respondents complaint was one for breach of contract, and (2) in
raising the award of damages from P3,000.00 to P6,000.00 although
respondents did not appeal from the decision of the lower court.
Under the facts as found by the Court of Appeals, we have to sustain
the judgement holding petitioner liable for damages for the death of
the child, Raquel Beltran. It may be pointed out that although it is true
that respondent Mariano Beltran, his wife, and their children
(including the deceased child) had alighted from the bus at a place
designated for disembarking or unloading of passengers, it was also
established that the father had to return to the vehicle (which was still
at a stop) to get one of his bags or bayong that was left under one of
the seats of the bus. There can be no controversy that as far as the
father is concerned, when he returned to the bus for his bayongwhich
was not unloaded, the relation of passenger and carrier between him
and the petitioner remained subsisting. For, the relation of carrier and
passenger does not necessarily cease where the latter, after alighting
from the car, aids the carrier's servant or employee in removing his
baggage from the car.1 The issue to be determined here is whether
as to the child, who was already led by the father to a place about 5
meters away from the bus, the liability of the carrier for her safety
under the contract of carriage also persisted.
It has been recognized as a rule that the relation of carrier and
passenger does not cease at the moment the passenger alights from
the carrier's vehicle at a place selected by the carrier at the point of
destination, but continues until the passenger has had a reasonable
time or a reasonable opportunity to leave the carrier's premises. And,
what is a reasonable time or a reasonable delay within this rule is to
be determined from all the circumstances. Thus, a person who, after
alighting from a train, walks along the station platform is considered
still a passenger.2 So also, where a passenger has alighted at his
destination and is proceeding by the usual way to leave the
company's premises, but before actually doing so is halted by the
report that his brother, a fellow passenger, has been shot, and he in
good faith and without intent of engaging in the difficulty, returns to
relieve his brother, he is deemed reasonably and necessarily delayed
and thus continues to be a passenger entitled as such to the
protection of the railroad and company and its agents.3
In the present case, the father returned to the bus to get one of his
baggages which was not unloaded when they alighted from the bus.
Raquel, the child that she was, must have followed the father.
However, although the father was still on the running board of the
bus awaiting for the conductor to hand him the bag or bayong, the
bus started to run, so that even he (the father) had to jump down
from the moving vehicle. It was at this instance that the child, who Concepcion, C.J., Reyes, J.B.L., Dizon, Regala, Bengzon, J.P.,
must be near the bus, was run over and killed. In the circumstances, Zaldivar, Sanchez and Castro, JJ., concur.
it cannot be claimed that the carrier's agent had exercised the Makalintal, J., concurs in the result.
"utmost diligence" of a "very cautions person" required by Article
1755 of the Civil Code to be observed by a common carrier in the
discharge of its obligation to transport safely its passengers. In the
first place, the driver, although stopping the bus, nevertheless did not
put off the engine. Secondly, he started to run the bus even before
the bus conductor gave him the signal to go and while the latter was
still unloading part of the baggages of the passengers Mariano
Beltran and family. The presence of said passengers near the bus
was not unreasonable and they are, therefore, to be considered still
as passengers of the carrier, entitled to the protection under their
contract of carriage.

But even assuming arguendo that the contract of carriage has

already terminated, herein petitioner can be held liable for the
negligence of its driver, as ruled by the Court of Appeals, pursuant to
Article 2180 of the Civil Code. Paragraph 7 of the complaint, which
reads —

That aside from the aforesaid breach of contract, the death

of Raquel Beltran, plaintiffs' daughter, was caused by the
negligence and want of exercise of the utmost diligence of
a very cautious person on the part of the defendants and
their agent, necessary to transport plaintiffs and their
daughter safely as far as human care and foresight can
provide in the operation of their vehicle.

is clearly an allegation for quasi-delict. The inclusion of this averment

for quasi-delict, while incompatible with the other claim under the
contract of carriage, is permissible under Section 2 of Rule 8 of the
New Rules of Court, which allows a plaintiff to allege causes of action
in the alternative, be they compatible with each other or not, to the
end that the real matter in controversy may be resolved and
determined.4

The plaintiffs sufficiently pleaded the culpa or negligence upon which

the claim was predicated when it was alleged in the complaint that
"the death of Raquel Beltran, plaintiffs' daughter, was caused by the
negligence and want of exercise of the utmost diligence of a very
cautious person on the part of the defendants and their agent." This
allegation was also proved when it was established during the trial
that the driver, even before receiving the proper signal from the
conductor, and while there were still persons on the running board of
the bus and near it, started to run off the vehicle. The presentation of
proof of the negligence of its employee gave rise to the presumption
that the defendant employer did not exercise the diligence of a good
father of the family in the selection and supervision of its employees.
And this presumption, as the Court of Appeals found, petitioner had
failed to overcome. Consequently, petitioner must be adjudged
peculiarily liable for the death of the child Raquel Beltran.

The increase of the award of damages from P3,000.00 to P6,000.00

by the Court of Appeals, however, cannot be sustained. Generally,
the appellate court can only pass upon and consider questions or
issues raised and argued in appellant's brief. Plaintiffs did not appeal
from that portion of the judgment of the trial court awarding them on
P3,000.00 damages for the death of their daughter. Neither does it
appear that, as appellees in the Court of Appeals, plaintiffs have
pointed out in their brief the inadequacy of the award, or that the
inclusion of the figure P3,000.00 was merely a clerical error, in order
that the matter may be treated as an exception to the general
rule.5Herein petitioner's contention, therefore, that the Court of
Appeals committed error in raising the amount of the award for
damages is, evidently, meritorious.1äwphï1.ñët

Wherefore, the decision of the Court of Appeals is hereby modified

by sentencing, the petitioner to pay to the respondents Mariano
Beltran, et al., the sum of P3,000.00 for the death of the child, Raquel
Beltran, and the amount of P400.00 as actual damages. No costs in
this instance. So ordered.
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-42926 September 13, 1985
PEDRO VASQUEZ, SOLEDAD ORTEGA, CLETO B. BAGAIPO,
AGUSTINA VIRTUDES, ROMEO VASQUEZ and MAXIMINA
CAINAY, petitioners,
vs.
THE COURT OF APPEALS and FILIPINAS PIONEER LINES,
INC., respondents.
Emilio D. Castellanes for petitioners.
Apolinario A. Abantao for private respondents.
MELENCIO-HERRERA, J.:
This litigation involves a claim for damages for the loss at sea of
petitioners' respective children after the shipwreck of MV Pioneer
Cebu due to typhoon "Klaring" in May of 1966.
The factual antecedents, as summarized by the trial Court and
adopted by respondent Court, and which we find supported by the
record, read as follows:
When the inter-island vessel MV "Pioneer Cebu"
left the Port of Manila in the early morning of May
15, 1966 bound for Cebu, it had on board the
spouses Alfonso Vasquez and Filipinas Bagaipo
and a four-year old boy, Mario Marlon Vasquez,
among her passengers. The MV "Pioneer Cebu"
encountered typhoon "Klaring" and struck a reef
on the southern part of Malapascua Island,
located somewhere north of the island of Cebu
and subsequently sunk. The aforementioned
passengers were unheard from since then.
Plaintiffs Pedro Vasquez and Soledad Ortega are
the parents of Alfonso Vasquez; plaintiffs Cleto
Bagaipo and Agustina Virtudes are the parents of
Filipinas Bagaipo; and plaintiffs Romeo Vasquez
and Maxima Cainay are the parents of the child,
Mario Marlon Vasquez. They seek the recovery
of damages due to the loss of Alfonso Vasquez,
Filipinas Bagaipo and Mario Marlon Vasquez
during said voyage.
At the pre-trial, the defendant admitted its
contract of carriage with Alfonso Vasquez,
Filipinas Bagaipo and Mario Marlon Vasquez,
and the fact of the sinking of the MV "Pioneer
Cebu". The issues of the case were limited to the
defenses alleged by the defendant that the
sinking of the vessel was caused by force
majeure, and that the defendant's liability had
been extinguished by the total loss of the vessel.
The evidence on record as to the circumstances
of the last voyage of the MV "Pioneer Cebu"
came mainly, if not exclusively, from the
defendant. The MV "Pioneer Cebu" was owned
and operated by the defendant and used in the
transportation of goods and passengers in the
inter-island shipping. Scheduled to leave the Port
of Manila at 9:00 p.m. on May 14, 1966, it
actually left port at 5:00 a.m. the following day,
May 15, 1966. It had a passenger capacity of
three hundred twenty-two (322) including the
crew. It undertook the said voyage on a special
permit issued by the Collector of Customs
inasmuch as, upon inspection, it was found to be
without an emergency electrical power system.
The special permit authorized the vessel to carry
only two hundred sixty (260) passengers due to
the said deficiency and for lack of safety devices
for 322 passengers (Exh. 2). A headcount was
made of the passengers on board, resulting on
the tallying of 168 adults and 20 minors, although
the passengers manifest only listed 106
passengers. It has been admitted, however, that
the headcount is not reliable inasmuch as it was
only done by one man on board the vessel.
When the vessel left Manila, its officers were
already aware of the typhoon Klaring building up
somewhere in Mindanao. There being no
typhoon signals on the route from Manila to
Cebu, and the vessel having been cleared by the
Customs authorities, the MV "Pioneer Cebu" left
on its voyage to Cebu despite the typhoon. When
it reached Romblon Island, it was decided not to
seek shelter thereat, inasmuch as the weather
condition was still good. After passing Romblon
and while near Jintotolo island, the barometer still
indicated the existence of good weather condition
continued until the vessel approached
Tanguingui island. Upon passing the latter island,
however, the weather suddenly changed and
heavy rains felt Fearing that due to zero visibility,
the vessel might hit Chocolate island group, the
captain ordered a reversal of the course so that
the vessel could 'weather out' the typhoon by
facing the winds and the waves in the open.
Unfortunately, at about noontime on May 16,
1966, the vessel struck a reef near Malapascua
island, sustained leaks and eventually sunk,
bringing with her Captain Floro Yap who was in
command of the vessel.
Due to the loss of their children, petitioners sued for damages before
the Court of First Instance of Manila (Civil Case No. 67139).
Respondent defended on the plea of force majeure, and the
extinction of its liability by the actual total loss of the vessel.
After proper proceedings, the trial Court awarded damages, thus:
WHEREFORE, judgment is hereby rendered
ordering the defendant to pay:
(a) Plaintiffs Pedro Vasquez and Soledad Ortega
the sums of P15,000.00 for the loss of earning
capacity of the deceased Alfonso Vasquez,
P2,100.00 for support, and P10,000.00 for moral
damages;
(b) Plaintiffs Cleto B. Bagaipo and Agustina
Virtudes the sum of P17,000.00 for loss of
earning capacity of deceased Filipinas Bagaipo,
and P10,000.00 for moral damages; and
(c) Plaintiffs Romeo Vasquez and Maximina
Cainay the sum of P10,000.00 by way of moral
damages by reason of the death of Mario Marlon
Vasquez.
On appeal, respondent Court reversed the aforementioned judgment
and absolved private respondent from any and all liability.
Hence, this Petition for Review on Certiorari, the basic issue being
the liability for damages of private respondent for the presumptive
death of petitioners' children.
The trial Court found the defense of caso fortuito untenable due to
various decisive factors, thus:
... It is an admitted fact that even before the
vessel left on its last voyage, its officers and crew
were already aware of the typhoon brewing
somewhere in the same general direction to
which the vessel was going. The crew of the
vessel took a calculated risk when it proceeded
despite the typhoon advisory. This is quite
evident from the fact that the officers of the
vessel had to conduct conferences amongst
themselves to decide whether or not to proceed.
The crew assumed a greater risk when, instead
of seeking shelter in Romblon and other islands
the vessel passed en route, they decided to take
a change on the expected continuation of the
good weather the vessel was encountering, and
the possibility that the typhoon would veer to
some other directions. The eagerness of the crew
of the vessel to proceed on its voyage and to
arrive at its destination is readily understandable.
It is undeniably lamentable, however, that they
did so at the risk of the lives of the passengers on
board.
required of very cautious persons, 9 they decided to take a calculated
risk. In so doing, they failed to observe that extraordinary diligence
required of them explicitly by law for the safety of the passengers
transported by them with due regard for an circumstances 10 and
unnecessarily exposed the vessel and passengers to the tragic
mishap. They failed to overcome that presumption of fault or
negligence that arises in cases of death or injuries to passengers. 11
While the Board of Marine Inquiry, which investigated the disaster,
exonerated the captain from any negligence, it was because it had
considered the question of negligence as "moot and academic," the
captain having "lived up to the true tradition of the profession." While
we are bound by the Board's factual findings, we disagree with its
conclusion since it obviously had not taken into account the legal
responsibility of a common carrier towards the safety of the
passengers involved.
With respect to private respondent's submission that the total loss of
the vessel extinguished its liability pursuant to Article 587 of the Code
of Commerce12 as construed in Yangco vs. Laserna, 73 Phil. 330
[1941], suffice it to state that even in the cited case, it was held that
the liability of a shipowner is limited to the value of the vessel or to
the insurance thereon. Despite the total loss of the vessel therefore,
its insurance answers for the damages that a shipowner or agent
may be held liable for by reason of the death of its passengers.

Contrariwise, respondent Appellate Court believed that the calamity
was caused solely and proximately by fortuitous event which not
even extraordinary diligence of the highest degree could have
guarded against; and that there was no negligence on the part of the
common carrier in the discharge of its duties.
WHEREFORE, the appealed judgment is hereby REVERSED and
the judgment of the then Court of First Instance of Manila, Branch V,
in Civil Case No. 67139, is hereby reinstated. No costs.
SO ORDERED.

Upon the evidence and the applicable law, we sustain the trial Court.
Teehankee (Chairman), Plana, Relova, Gutierrez, Jr., De la Fuente
"To constitute a caso fortuito that would exempt a person from
and Patajo, JJ., concur.
responsibility, it is necessary that (1) the event must be independent
of the human will; (2) the occurrence must render it impossible for the
debtor to fulfill the obligation in a normal manner; and that (3) the
obligor must be free of participation in, or aggravation of, the injury to
the creditor." 1 In the language of the law, the event must have been
impossible to foresee, or if it could be foreseen, must have been
impossible to avoid. 2 There must be an entire exclusion of human
agency from the cause of injury or loss. 3

Turning to this case, before they sailed from the port of Manila, the
officers and crew were aware of typhoon "Klaring" that was reported
building up at 260 kms. east of Surigao. In fact, they had lashed all
the cargo in the hold before sailing in anticipation of strong winds and
rough waters.4 They proceeded on their way, as did other vessels
that day. Upon reaching Romblon, they received the weather report
that the typhoon was 154 kms. east southeast of Tacloban and was
moving west northwest.5 Since they were still not within the radius of
the typhoon and the weather was clear, they deliberated and decided
to proceed with the course. At Jintotolo Island, the typhoon was
already reported to be reaching the mainland of Samar. 6 They still
decided to proceed noting that the weather was still "good" although,
according to the Chief Forecaster of the Weather Bureau, they were
already within the typhoon zone. 7 At Tanguingui Island, about 2:00
A.M. of May 16, 1966, the typhoon was in an area quite close to
Catbalogan, placing Tanguingui also within the typhoon zone.
Despite knowledge of that fact, they again decided to proceed relying
on the forecast that the typhoon would weaken upon crossing the
mainland of Samar. 8 After about half an hour of navigation towards
Chocolate Island, there was a sudden fall of the barometer
accompanied by heavy downpour, big waves, and zero visibility. The
Captain of the vessel decided to reverse course and face the waves
in the open sea but because the visibility did not improve they were in
total darkness and, as a consequence, the vessel ran aground a reef
and sank on May 16, 1966 around 12:45 P.M. near Malapascua
Island somewhere north of the island of Cebu.

Under the circumstances, while, indeed, the typhoon was an

inevitable occurrence, yet, having been kept posted on the course of
the typhoon by weather bulletins at intervals of six hours, the captain
and crew were well aware of the risk they were taking as they
hopped from island to island from Romblon up to Tanguingui. They
held frequent conferences, and oblivious of the utmost diligence
 [G.R. No. 116110. May 15,1996]
BALIWAG TRANSIT, INC., petitioner, vs. COURT OF APPEALS,
SPOUSES ANTONIO GARCIA & LETICIA GARCIA, A &
J TRADING, AND JULIO RECONTIQUE, respondents.
SYLLABUS
1. CIVIL LAW; CONTRACTS; SPECIAL CONTRACTS; COMMON
CARRIERS; LIABILITY FOR DAMAGES; ESTABLISHED IN
CASE AT BAR. As a common carrier, Baliwag breached its
contract of carriage when it failed to deliver its passengers,
Leticia and Allan Garcia to their destination safe and sound. A
common carrier is bound to carry its passengers safely as far
as human care and foresight can provide, using the utmost
diligence of a very cautious person, with due regard for all the
circumstances. In a contract of carriage, it is presumed that the
common carrier was at fault or was negligent when a
passenger dies or is injured. Unless the presumption is
rebutted, the court need not even make an express finding of
fault or negligence on the part of the common carrier. This
statutory presumption may only be overcome by evidence that
the carrier exercised extraordinary diligence as prescribed in
Articles 1733 and 1755 of the Civil Code. The records are
bereft of any proof to show that Baliwag exercised
extraordinary diligence. On the contrary, the evidence
demonstrates its driver's recklessness. Leticia Garcia testified
that the bus was running at a very high speed despite the
drizzle and the darkness of the highway. The passengers
pleaded for its driver to slow down, but their plea was
ignored. Leticia also revealed that the driver was smelling of
liquor. She could smell him as she was seated right behind the
driver. Another passenger, Felix Cruz testified that immediately
before the collision, the bus driver was conversing with a co-
employee. All these prove the bus driver's wanton disregard for
the physical safety of his passengers, which make Baliwag as a
common carrier liable for damages under Article 1759 of the
Civil Code.
2. ID.; ID.; ID.; ID.; LAND TRANSPORTATION AND TRAFFIC
CODE; SECTION 34(g) THEREOF; SUBSTANTIALLY
COMPLIED WITH IN CASE AT BAR. Baliwag cannot evade its
liability by insisting that the accident was caused solely by the
negligence of A & J Trading and Julio Recontique. It harps on
their alleged non use of early warning device as testified to by
Col. Demetrio dela Cruz, the station commander of Gapan,
Nueva Ecija who investigated the incident, and Francisco
Romano, the bus conductor. The records do not bear out
Baliwag's contention. Col. dela Cruz and Romano testified that
they did not see any early warning device at the scene of the
accident. They were referring to the triangular reflectorized
plates in red and yellow issued by the Land Transportation
Office. However, the evidence shows that Recontique and
Ecala placed a kerosene lamp or torch at the edge of the road,
near the rear portion of the truck to serve as an early warning
device. This substantially complies with Section 34 (g) of the
Land Transportation and Traffic Code, to wit: "(g) lights and
reflector when parked or disabled. Appropriate parking lights or
flares visible one hundred meters away shall be displayed at
the corner of the vehicle whenever such vehicle is parked on
highways or in places that are not well-lighted or, is placed in
such manner as to endanger passing traffic. Furthermore,
every motor vehicle shall be provided at all times with built-in
reflectors or other similar warning devices either pasted,
painted or attached at its front and back which shall likewise be
visible at night at least one hundred meters away. No vehicle
not provided with any of the requirements mentioned in this
subsection shall be registered." Baliwag's argument that the
kerosene lamp or torch does not substantially comply with the
law is untenable. The aforequoted law clearly allows the use
not only of an early warning device of the triangular
reflectorized plates variety but also parking lights or flares
visible one hundred meters away. Indeed, Col. dela Cruz
himself admitted that a kerosene lamp is an acceptable
substitute for the reflectorized plates. No negligence, therefore,
may be imputed to A & J Trading and its driver, Recontique.
3. ID.; DAMAGES; To PROVE ACTUAL DAMAGES, THE BEST
EVIDENCE AVAILABLE TO THE PARTIES MUST BE
PRESENTED. The propriety of the amount awarded as
hospitalization and medical fees. The award of P25,000.00 is
not supported by the evidence on record. The Garcias
presented receipts marked as Exhibits "B-1 " to "B-42" but their
total amounted only to P5,017.74. To be sure, Leticia testified
as to the extra amount spent for her medical needs but without
more reliable evidence, her lone testimony cannot justify the
award of P25,000.00. To prove actual damages, the best
evidence available to the injured party must be presented. The
court cannot rely on uncorroborated testimony whose truth is
suspect, but must depend upon competent proof that damages
have been actually suffered. Thus, we reduce the actual
damages for medical and hospitalization expenses to
P5,017.74.
4. ID.; ID.; MORAL DAMAGES; RECOVERABLE IF THE CARRIER
THROUGH ITS AGENT, ACTED FRAUDULENTLY OR IN
BAD FAITH. The award of moral damages is in accord with
law. In a breach of contract of carriage, moral damages are
recoverable if the carrier, through its agent, acted fraudulently
or in bad faith. The evidence shows the gross negligence of the
driver of Baliwag bus which amounted to bad faith. Without
doubt, Leticia and Allan experienced physical suffering, mental
anguish and serious anxiety by reason of the accident.
APPEARANCES OF COUNSEL
Leopoldo C. Sta. Maria for Baliwag Transit, Inc.
Arturo D. Vallar for Sps. Antonio & Leticia Garcia.
Allan A. Leynes for A & J Trading, and Julio Recontique.
DECISION
PUNO, J.:
This is a petition for certiorari to review the Decision[1] of the
Court of Appeals in CA-G.R. CV-31246 awarding damages in favor of
the spouses Antonio and Leticia Garcia for breach of contract of
carriage.[2] filed by the spouses Garcia questioning the same Court of
Appeals' Decision which reduced their award of damages. On
November 13, 1995, we denied their petition for review.
The records show that on July 31, 1980, Leticia Garcia, and her
five-year old son, Allan Garcia, boarded Baliwag Transit Bus No.
2036 bound for Cabanatuan City driven by Jaime Santiago. They
took the seat behind the driver.
At about 7:30 in the evening, in Malimba, Gapan, Nueva Ecija,
the bus passengers saw a cargo truck parked at the shoulder of the
national highway. Its left rear portion jutted to the outer lane, the
shoulder of the road was too narrow to accommodate the whole
truck. A kerosene lamp appeared at the edge of the road obviously to
serve as a warning device. The truck driver, Julio Recontique, and
his helper, Arturo Escala, were then replacing a flat tire. The truck is
owned by respondent A & J Trading.
Bus driver Santiago was driving at an inordinately fast speed
and failed to notice the truck and the kerosene lamp at the edge of
the road. Santiago's passengers urged him to slow down but he paid
them no heed. Santiago even carried animated conversations with
his co-employees while driving. When the danger of collision became
imminent, the bus passengers shouted "Babangga tayo!". Santiago
stepped on the brake, but it was too late. His bus rammed into the
stalled cargo truck. It caused the instant death of Santiago and
Escala, and injury to several others. Leticia and Allan Garcia were
among the injured passengers.
Leticia suffered a fracture in her pelvis and right leg. They
rushed her to the provincial hospital in Cabanatuan City where she
was given emergency treatment. After three days, she was
transferred to the National Orthopedic Hospital where she was
confined for more than a month.[3] She underwent an operation for
partial hip prosthesis.[4]
Allan, on the other hand, broke a leg. He was also given
emergency treatment at the provincial hospital.
 Spouses Antonio and Leticia Garcia sued Baliwag Transit, Inc.,
A & J Trading and Julio Recontique for damages in the Regional Trial
Court of Bulacan.[5] Leticia sued as an injured passenger of Baliwag
and as mother of Allan. At the time of the complaint, Allan was a
minor, hence, the suit initiated by his parents in his favor.
Baliwag, A & J Trading and Recontique disclaimed
responsibility for the mishap. Baliwag alleged that the accident was
caused solely by the fault and negligence of A & J Trading and its
driver, Recontique. Baliwag charged that Recontigue failed to place
an early warning device at the corner of the disabled cargo truck to
warn oncoming vehicles.[6] On the other hand, A & J Trading and
Recontique alleged that the accident was the result of the negligence
and reckless driving of Santiago, bus driver of Baliwag.[7]
After hearing, the trial court found all the defendants liable,
thus:
xxxxxxxxx
"In view thereof, the Court holds that both defendants should be held
liable; the defendant Baliwag Transit, Inc. for having failed to deliver
the plaintiff and her son to their point of destination safely in violation
of plaintiff's and defendant Baliwag Transit's contractual relation.
The defendant A & J and Julio Recontique for failure to provide its
cargo truck with an early warning device in violation of the Motor
Vehicle Law."[8]
The trial court ordered Baliwag, A & J Trading and Recontique
to pay jointly and severally the Garcia spouses the following: (1)
P25,000.00 hospitalization and medication fee, (2) P450,000.00 loss
of earnings in eight (8) years, (3) P2,000.00 for the hospitalization of
their son Allan Garcia, (4) P50,000.00 moral damages, and (5)
P30,000.00 attorney's fee.[9]
On appeal, the Court of Appeals modified the trial court's
Decision by absolving A & J Trading from liability and by reducing the
award of attorney's fees to P10,000.00 and loss of earnings to
P300,000.00, respectively.[10]
Baliwag filed the present petition for review raising the following
issues:
1. Did the Court of Appeals err in absolving A & J Trading from
liability and holding Baliwag solely liable for the injuries suffered by
Leticia and Allan Garcia in the accident?
2. Is the amount of damages awarded by the Court of Appeals to the
Garcia spouses correct?
We affirm the factual findings of the Court of Appeals.
I
As a common carrier, Baliwag breached its contract of carriage
when it failed to deliver its passengers, Leticia and Allan Garcia to
their destination safe and sound. A common carrier is bound to carry
its passengers safely as far as human care and foresight can
provide, using the utmost diligence of a very cautious person, with
due regard for all the circumstances.[11] In a contract of carriage, it is
presumed that the common carrier was at fault or was negligent
when a passenger dies or is injured. Unless the presumption is
rebutted, the court need not even make an express finding of fault or
negligence on the part of the common carrier. This statutory
presumption may only be overcome by evidence that the carrier
exercised extraordinary diligence as prescribed in Articles 1733 and
1755 of the Civil Code.[12]
The records are bereft of any proof to show that Baliwag
exercised extraordinary diligence. On the contrary, the
evidence demonstrates its driver's recklessness. Leticia Garcia
testified that the bus was running at a very high speed despite the
drizzle and the darkness of the highway. The passengers pleaded for
its driver to slow down, but their plea was ignored.[13] Leticia also
revealed that the driver was smelling of liquor.[14] She could smell him
as she was seated right behind the driver. Another passenger, Felix
Cruz testified that immediately before the collision, the bus driver was
conversing with a co-employee.[15] All these prove the bus driver's
wanton disregard for the physical safety of his passengers, which
makes Baliwag as a common carrier liable for damages under Article
1759 of the Civil Code:
Art. 1759. Common carriers are liable for the death of or injuries to
passengers through the negligence or willfull acts of the former's
employees, although such employees may have acted beyond the
scope of their authority or in violation of the orders of the common
carriers.
This liability of the common carriers do not cease upon proof that
they exercised all the diligence of a good father of a family in the
selection or supervision of their employees.
Baliwag cannot evade its liability by insisting that the accident
was caused solely by the negligence of A & J Trading and Julio
Recontique. It harps on their alleged non use of an early warning
device as testified to by Col. Demetrio dela Cruz, the station
commander of Gapan, Nueva Ecija who investigated the incident,
and Francisco Romano, the bus conductor.
The records do not bear out Baliwag's contention. Col. dela
Cruz and Romano testified that they did not see any early warning
device at the scene of the accident.[16] They were referring to the
triangular reflectorized plates in red and yellow issued by the Land
Transportation Office. However, the evidence shows that Recontique
and Ecala placed a kerosene lamp or torch at the edge of the road,
near the rear portion of the truck to serve as an early warning
device.[17] This substantially complies with Section 34 (g) of the Land
Transportation and Traffic Code, to wit:
(g) Lights and reflector when parked or
disabled. Appropriate parking lights or flares visible one hundred
meters away shall be displayed at the corner of the vehicle
whenever such vehicle is parked on highways or in places that are
not well-lighted or, is placed in such manner as to endanger passing
traffic. Furthermore, every motor vehicle shall be provided at all times
with built-in reflectors or other similar warning devices either pasted,
painted or attached at its front and back which shall likewise be
visible at night at least one hundred meters away. No vehicle not
provided with any of the requirements mentioned in this subsection
shall be registered. (Italics supplied)
Baliwag's argument that the kerosene lamp or torch does not
substantially comply with the law is untenable. The aforequoted law
clearly allows the use not only of an early warning device of the
triangular reflectorized plates variety but also parking lights or flares
visible one hundred meters away. Indeed, Col. dela Cruz himself
admitted that a kerosene lamp is an acceptable substitute for the
reflectorized plates.[18] No negligence, therefore, may be imputed to A
& J Trading and its driver, Recontique.
Anent this factual issue, the analysis of evidence made by the
Court of Appeals deserves our concurrence, viz:
xxx xxx xxx
In the case at bar, both the injured passengers of the Baliwag
involved in the accident testified that they saw some sort of kerosene
or a torch on the rear portion of the truck before the accident. Baliwag
Transit's conductor attempted to defeat such testimony by declaring
that he noticed no early warning device in front of the truck.
Among the testimonies offered by the witnesses who were
present at the scene of the accident, we rule to uphold the affirmative
testimonies given by the two injured passengers and give less
credence to the testimony of the bus conductor who solely testified
that no such early warning device exists.
The testimonies of injured passengers who may well be
considered as disinterested witness appear to be natural and more
probable than the testimony given by Francisco Romano who is
undoubtedly interested in the outcome of the case, being the
conductor of the defendant-appellant Baliwag Transit Inc.
 It must be borne in mind that the situation then prevailing at the damages involved,[25] the award of attorney's fee for P10,000.00 is
time of the accident was admittedly drizzly and all dark. This being just and reasonable.
so, it would be improbable and perhaps impossible on the part of the
truck helper without the torch nor the kerosene to remove the flat IN VIEW WHEREOF, the Decision of the respondent Court of
tires of the truck. Moreover, witness including the bits conductor Appeals in CA-G.R. CV-31246 is AFFIRMED with the
himself admitted that the passengers shouted, that they are going to MODIFICATION reducing the actual damages for hospitalization and
bump before the collision which consequently caused the bus driver medical fees to P5,017.74. No costs.
to apply the brake 3 to 4 meters away from the truck. Again, without SO ORDERED.
the kerosene nor the torch in front of the truck, it would be
improbable for the driver, more so the passengers to notice the truck Regalado (Chairman), Romero, Mendoza, and Torres, Jr.,
to be bumped by the bus considering the darkness of the place at the JJ., concur.
time of the accident.
xxxxxxxxx
While it is true that the investigating officer testified that he
found no early warning device at the time of his investigation, We rule
to give less credence to such testimony insofar as he himself
admitted on cross examination that he did not notice the presence of
any kerosene lamp at the back of the truck because when he arrived
at the scene of the accident, there were already many people
surrounding the place (TSN, Aug, 22, 1989, p. 13). He further
admitted that there exists a probability that the lights of the truck may
have been smashed by the bus at the time of the accident
considering the location of the truck where its rear portion was
connected with the front portion of the bus (TSN, March 29, 1985, pp.
11-13). Investigator's testimony therefore did not confirm nor deny
the existence of such warning device, making his testimony of little
probative value.[19]
II
We now review the amount of damages awarded to the Garcia
spouses.
First, the propriety of the amount awarded as hospitalization
and medical fees. The award of P25,000.00 is not supported by the
evidence on record. The Garcias presented receipts marked as
Exhibits B-1 to B 42 but their total amounted only to P5,017.74. To be
sure, Leticia testified as to the extra amount spent for her medical
needs but without more reliable evidence, her lone testimony cannot
justify the award of P25,000.00. To prove actual damages, the best
evidence available to the injured party must be presented. The court
cannot rely on uncorroborated testimony whose truth is suspect, but
must depend upon competent proof that damages have been actually
suffered[20] Thus, we reduce the actual damages for medical and
hospitalization expenses to P5,017.74.
Second, we find as reasonable the award of P300,000.00
representing Leticia's lost earnings. Before the accident, Leticia was
engaged in embroidery, earning P5,000.00 per month.[21] Her injuries
forced her to stop working. Considering the nature and extent of her
injuries and the length of time it would take her to recover, [22] we find
it proper that Baliwag should compensate her lost income for five (5)
years.[23]
Third, the award of moral damages is in accord with law. In a
breach of contract of carriage, moral damages are recoverable if the
carrier, through its agent, acted fraudulently or in bad faith.[24] The
evidence shows the gross negligence of the driver of Baliwag bus
which amounted to bad faith. Without doubt, Leticia and Allan
experienced physical suffering, mental anguish and serious anxiety
by reason of the accident. Leticia underwent an operation to replace
her broken hip bone with a metal plate. She was confined at the
National Orthopedic Hospital for 45 days. The young Allan was also
confined in the hospital for his foot injury. Contrary to the contention
of Baliwag, the decision of the trial court as affirmed by the Court of
Appeals awarded moral damages to Antonio and Leticia Garcia not in
their capacity as parents of Allan. Leticia was given moral damages
as an injured party. Allan was also granted moral damages as an
injured party but because of his minority, the award in his favor has to
be given to his father who represented him in the suit.
Finally, we find the award of attorney's fees justified. The
complaint for damages was instituted by the Garcia spouses on
December 15, 1982, following the unjustified refusal of Baliwag to
settle their claim. The Decision was promulgated by the trial court
only on January 29, 1991 or about nine years later. Numerous
pleadings were filed before the trial court, the appellate court and to
this Court. Given the complexity of the case and the amount of
 Republic of the Philippines way; this reinforces the presumption that petitioners had neglected to
SUPREME COURT provide a safe conveyance (Art. 1756, New Civil Code). Evidence of
Manila the required extraordinary diligence was not introduced to rebut the
presumption.
EN BANC
On the contrary, the appellate court found that the bus was
G.R. No. L-16086 May 29, 1964 overcrowded and overspeeding, and the floor thereof was weak —
persuasive indications of negligence; and reasoned out that the tire
exploded due to one or a combination of the following: "The tire was
M. RUIZ HIGHWAY TRANSIT, INC. and MARTIN
not strong and safe; the air pressure was not properly checked; the
BUENA, petitioners,
load was heavy; the excessive speed of the bus must have
vs.
overstrained the tire; and the high velocity generated heat in the tire
COURT OF APPEALS, GUILLERMO MONSERRAT and MARTA
which could have expanded the already compressed air therein."2
CONSIGNADO, respondents.

Petitioners venture to guess that it was due either to accidental

T. F. Cachero for petitioners.
puncture by a sharp instrument, as a nail, or to latent defect in the
Godofredo C. Montesines for respondents.
tire. Evidence should have been — but was not — presented to
establish such defense.
BENGZON, C.J.:
Even conceding that the tire blow-out was accidental, we could still
Appeal by certiorari from a decision of the Court of Appeals. hold the carrier liable for failure to provide a safe floor in the bus.

In the Laguna court of first instance, the spouses Guillermo
Monserrat and Marta Consignado sued M. Ruiz Highway Transit,
Inc., and Martin Buena to recover damages for the death of their four-
year old daughter Victoria.
In the morning of May 22, 1954, said child and her parents were
paying passengers in a bus of defendant transportation company
driven by co-defendant Buena, bound for Antipolo, Rizal. In Sta.
Rosa, Laguna, while the bus was running, a rear tire exploded,
blasting a hole in the very place where Victoria was standing in front
of her mother. As a result, the child fell through the hole, and died
that same morning from injuries sustained in the fall.1äwphï1.ñët
The court of first instance dismissed the complaint on the ground that
(1) the accident was not due to negligence of the carrier, but was an
act of God; and (2) even if negligence was attributable to defendants,
their liability had been discharged, as evidenced by Exhibits 2 and 3
quoted in the footnote. 1
On appeal by plaintiffs, the Court of Appeals reversed the judgment,
upon the finding that (1) defendants failed to prove the extraordinary
diligence required of carriers; and (2) Exhibits 2 and 3 did not effect a
waiver of plaintiffs' right to damages. Said appellate court, therefore,
required defendants to pay plaintiffs P6,000.00 as indemnity for the
child's death; P2,000.00 as moral damages and P500.00 as
attorney's fees, with interest from the date of its decision, (minus the
P150.00 that had been given to plaintiff Guillermo Monserrat, thru
Exhibit 3).
Exhibits 2 and 3 are not proof that petitioners have discharged their
legal liability to claimants. What is expressed there is the latter's
belief — clearly erroneous — that petitioners are not liable to them
and acknowledgment of the voluntary help extended by petitioner
transportation company. The belief is baseless. That respondents
entertained such an ill-founded impression is not to be wondered at.
They are ignorant, illiterate, indigent, and, at the time they signed
Exhibits 2 and 3, thoroughly confused and distracted by the death of
their child.
The minimum death indemnity is P3,0003, although this Court has in
various instances granted P6,000.00. As for moral damages, the
carrier is liable therefor to the parents of a child who meets death
while a passenger in any of the carrier's vehicles (Arts. 2206 and
1764, New Civil Code). Since respondents are indigents, and have
litigated as paupers, they should be allowed attorney's fees of
P500.00.
FOR THESE REASONS, the appealed decision is affirmed, with
costs.
Bautista Angelo, Concepcion, Reyes, J.B.L., Barrera, Paredes,
Regala and Makalintal, JJ., concur.
Padilla, Labrador and Dizon, JJ., took no part.

In their petition for review by certiorari, the carrier and the driver raise
the following issues: (1) whether in a contract of carriage breached
by the passenger's death, his parents may be granted moral
damages; and (2) whether the sum of P6,000.00 may be awarded as
death indemnity for a child passenger. In their brief, they pose the
following questions in addition to the above issues; (3) was there a
contract of carriage between the deceased child and petitioner
transportation company; (4) have petitioners rebutted the
presumption that they have been negligent; (5) was the bus crowded;
(6) was the bus running fast when the tire exploded; (7) what caused
the bursting of the tire; (8) was the bus floor weak; (9) was the blow-
out of the tire caso fortuito; and (10) was petitioners' liability cancelled
by Exhibits 2 and 3?

The alleged lack of a contract of carriage between the deceased child

and petitioner transportation company, if true, is a complete defense
against claimants' cause of action. However, the issue is now
inarguable, it being partly factual, on which the appellate court made
its finding.

Respondents and the child were paying passengers in the bus;

petitioners were duty bound to transport them, using the utmost
diligence of very cautious persons (Art. 1755, New Civil Code).
Therein they failed. The child died because the floor of the bus gave
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-24471 August 30, 1968
SILVERIO MARCHAN and PHILIPPINE RABBIT BUS CO.,
INC., petitioners,
vs.
ARSENIO MENDOZA, LEONARDA ILAYA, and ZENAIDA
MENDOZA, respondents.
Angel A. Sison for petitioners.
Manuel M. Crudo for respondents.
FERNANDO, J.:
Petitioners, the driver of the passenger bus responsible for the
injuries sustained by respondent for which he was duly prosecuted
and thereafter convicted for serious, less serious, and slight physical
injuries, and the bus firm, the Philippine Rabbit Bus Lines, seek the
reversal of a Court of Appeals decision of December 14, 1964 and a
resolution of March 31, 1965, holding them liable both for
compensatory and exemplary damages as well as attorney's fees. It
is the contention of petitioners that errors of law were committed
when, in the aforesaid decision, it was held that there was an implied
contract of carriage between the petitioner bus firm and respondents,
the breach of which was the occasion for their liability for
compensatory and exemplary damages as well as attorneys fees.
The facts as found by the Court of Appeals follow: "In the evening of
February 22, 1954, between 9:00 and 9:30 o'clock, a passenger bus
No. 141 of the Philippine Rabbit Bus Lines, bearing Plate No. TPU-
708 which was then driven by Silverio Marchan fell into a ditch
somewhere in Barrio Malanday, Polo, Bulacan, while travelling on its
way to Manila; as a result of which plaintiffs-appellees Arsenio
Mendoza, his wife and child, [respondents in this proceeding], who
were then inside the bus as passengers were thrown out to the
ground resulting in their multiple injuries. Plaintiff Arsenio Mendoza
suffered the most serious injuries which damaged his vertebrae
causing the paralysis of his lower extremities which up to the time
when this case was tried he continued to suffer. The physician who
attended and treated plaintiff Arsenio Mendoza opined that he may
never walk again. Consequently the driver of said bus Silverio
Marchan [now petitioner] was prosecuted for serious, less serious
and slight physical injuries through reckless imprudence before the
Justice of the Peace Court of Polo Bulacan, and thereafter convicted
as charged on June 29, 1956 ..., which judgment of conviction was
subsequently affirmed by the Court of First Instance of same
province ... In this present action before us, plaintiffs-appellees
Arsenio Mendoza, his wife and child sought to recover damages
against defendant-appellant Arsenio Marchan, then the driver of bus
No. 141 of the Philippine Rabbit Bus Lines, and from defendants-
appellants Bienvenido P. Buan and Natividad Paras in their capacity
as administrator and administratix, respectively of the estate of the
late Florencio P. Buan, doing business under the style name of the
Philippine Rabbit Bus Lines, predicated not only on a breach of
contract of carriage for failure of defendants operator as well as the
defendant driver to safely convey them to their destination, but also
on account of a criminal negligence on the part of defendant Silverio
Marchan resulting to plaintiff-appellee's multiple physical damages."1
The Court of Appeals in the decision under review found that there
was a preponderance of evidence to the effect that while
respondents Arsenio Mendoza, his wife, Leonarda Ilaya, and child,
Zenaida Mendoza "were waiting for a passenger bus on January 22,
1954 at about 9:00 in the evening at Malanday, they boarded
defendants-appellants' bus bearing No. 141 of the Philippine Rabbit
Bus Lines with Plate No. TPU-708 bound for Manila. And they were
treated as passengers thereto, for they paid their corresponding
fares. As they travelled along the highway bound for Manila, said bus
was traveling at a high rate of speed without due regard to the safety
of the passengers. So much so that one of the passengers had to call
the attention of Silverio Marchan who was then at the steering wheel
of said bus to lessen the speed or to slow down, but then defendant
Silverio Marchan did not heed the request of said passenger; neither
did he slacken his speed. On the contrary, defendant Silverio
Marchan even increased his speed while approaching a six-by-six
truck which was then parked ahead, apparently for the purpose of
passing the said parked truck and to avoid collision with the incoming
vehicle from the opposite direction. But, when appellant Silverio
Marchan veered his truck to resume position over the right lane, the
rear tires of said truck skidded because of his high rate of speed,
thereby causing said truck to fall into a ditch. Substantially, the
happening of the accident' resulting to the multiple injuries of
plaintiffs-appellees, was explained by defendant Silverio Marchan
who declared that while he was driving his bus from Barrio Malanday
bound towards Manila on a road test, he suddenly noticed an
oncoming vehicle. He thus shifted his light from dim to bright. Just
then, he noticed a six-by-six truck parked on the right lane of the road
where he was driving. Confronted with such situation that if he would
apply his brake he would bump his bus against the parked truck he
then increased his speed with the view of passing the said parked
truck, and thereafter he veered to negotiate for the proper position on
the right lane, but in so doing he swerved to the right in order to avoid
collision from the oncoming vehicle the rear portion of the bus
skidded and fell into the ditch."2
Hence the finding of negligence in the decision under review. Thus:
"From the facts as established preponderantly by the plaintiff and
substantially corroborated by the defendant Silverio Marchan, it is
clear that the cause of the accident was the gross negligence of the
defendant Silverio Marchan who when driving his vehicle on the night
in question was expected to have employed the highest degree of
care; and should have been assiduously prudent in handling his
vehicle to insure the safety of his passengers. There is no reason
why he could not have stopped his vehicle when noticing a parked
truck ahead of him if he was not driving at a high speed. His
admission to the effect that if he would apply his brake he would
bump or hit the parked truck ahead of him, since there was no time
for him to stop the bus he was driving, is a patent indication that he
was travelling at a high rate of speed without taking the necessary
precaution under the circumstance, considering that it was then
nighttime. It is our considered view that under the situation as
pictured before us by the driver of said bus, he should not have
increased his speed and by-passed the parked truck obviously with
the view of preventing a collision with the incoming vehicle. Any
prudent person placed under the situation of the appellant would not
have assumed the risk as what appellant did. The most natural
reaction that could be expected from one under the circumstance
was for him to have slackened and reduced his speed. But this was
not done simply because defendant-appellant could not possibly do
so under the circumstance because he was then travelling at a high
rate of speed. In fact, he had increased his speed in order to avoid
ramming the parked truck without, however, taking the necessary
precaution to insure the safety of his passengers."3
On the above facts, the Court of Appeals, in its decision of December
14, 1964, affirmed the amount of P40,000.00 awarded by the court
below as compensatory damages modifying the appealed lower court
decision by holding petitioners to pay the amount of P30,000.00 as
exemplary damages and sustaining the award of attorney's fees in
the amount of P5,000.00. Then came the resolution of March 31,
1965 by the Court of Appeals, where the motion for reconsideration
of petitioners was denied for lack of merit.
In their brief as petitioners, the first error assigned is the alleged
absence of an implied contract of carriage by the petitioner bus firm
and respondent. On this point, it was the holding of the Court of
Appeals: "Since it is undisputed by the evidence on record that
appellant Silverio Marchan was then at the steering wheel of the
vehicle of the defendant transportation company at that moment, the
riding public is not expected to inquire from time to time before they
board the passenger bus whether or not the driver who is at the
steering wheel of said bus was authorized to drive said vehicle or that
said driver is acting within the scope of his authority and observing
the existing rules and regulations required of him by the
management. To hold otherwise would in effect render the
aforequoted provision of law (Article 1759) ineffective."4 It is clear
from the above Civil Code provision that common carriers cannot need not also be alleged, and the reason is obvious because it is
escape liability "for the death of or injuries to passengers through the merely incidental or dependent upon what the court may award as
negligence and willful acts of the former's employees, although such compensatory damages. Unless and until this premise is determined
employees may have acted beyond the scope of their authority or in and established, what may be claimed as exemplary damages would
violation of the orders..." 5 From Vda. de Medina v. Cresencia,6 where amount to a mere surmise or speculation. It follows as a necessary
this Court, through Justice J.B.L. Reyes, stressed the "direct and consequence that the amount of exemplary damages need not be
immediate" liability of the carrier under the above legal provision, "not pleaded in the complaint because the same cannot be
merely subsidiary or secondary," toMaranan v. Perez,7 a 1967 predetermined. One can merely ask that it be determined by the
decision, the invariable holding has been the responsibility for breach court if in the use of its discretion the same is warranted by the
of the contract of carriage on the part of the carrier. According to the evidence, and this is just what appellee has done.".
facts as above disclosed, which this Court cannot disturb, the
applicability of Article 1759 is indisputable. Hence, the total absence Such a principle has been repeatedly upheld. 11 In Corpuz v.
of merit of the first assignment of error. Cuaderno, 12 this Court, again through Justice J.B.L. Reyes, made
clear that the amount "lies within the province of the court a quo, ..." It
The next two errors assigned would dispute the holding of the Court must be admitted, of course, that where it could be shown that a
of Appeals in imposing liability in the respective amounts of tribunal acted "with vindictiveness or wantonness and not in the
P40,000.00 for compensatory damages and P30,000.00 for exercise of honest judgment," then there is room for the interposition
exemplary damages. Again, such assignments of error cannot be of the corrective power of this Tribunal.
looked upon with favor. What the Court of Appeals did deserves not
reprobation but approval by this Court. No such reproach can be hurled at the decision and resolution now
under review. No such indictment would be justified. As noted earlier,
As to why the amount in compensatory damages should be fixed in both the second and the third assignments of error are devoid of
the sum of P40,000.00 is explained in the appealed decision thus: merit.
"Likewise, it is our considered view that the amount of P40,000.00
awarded by the court below as compensatory damages is quite Nor is there any occasion to consider further the fourth assigned
reasonable and fair, considering that plaintiff Arsenio Mendoza had error, petitioner being dissatisfied with the award of P5,000.00 as
suffered paralysis on the lower extremities, which will incapacitate attorney's fees to respondents. On its face, such an assignment of an
him to engage in his customary occupation throughout the remaining alleged error is conspicuously futile. 1äwphï1.ñët
years of his life, especially so if we take into account that plaintiff
Arsenio Mendoza was only 26 years old when he met an accident on
The judgment, however, must be modified in accordance with the
January 22, 1954; and taking the average span of life of a Filipino, he
ruling of this Court in Soberano v. Manila Railroad
may be expected to live for 30 years more; and bearing in mind the
Co. 13 Respondents are entitled to interest for the amount of
earning capacity of Arsenio Mendoza who before the happening of
compensatory damages from the date of the decision of the lower
this accident derived an income of almost P100.00 a month from the
court and legal interest on the exemplary damages from the date of
business of his father-in-law as Assistant Supervisor of the small
the decision of the Court of Appeals.
[fairs] and his income of P100.00 a month which he derived as a
professional boxer."8 Considering that respondent Arsenio Mendoza
was only in his middle twenties when, thru the negligence of WHEREFORE, as thus modified, the decision is affirmed, petitioners
petitioners, he lost the use of his limbs, being condemned for the being liable for the sum of P40,000.00 in the concept of
remainder of his life to be a paralytic, in effect leading a maimed, compensatory damages with interest at the legal rate from and after
well-nigh useless existence, the fixing of such liability in the amount January 26, 1960, and the sum of P30,000.00 as exemplary
of P40,000.00 as compensatory damages was well within the damages with interest at the legal rate from and after December 14,
discretion of the Court of Appeals. 1äwphï1.ñët 1964, as well as for the sum of P5,000.00 as attorney's fees, likewise
earning a legal rate of interest from and after January 26, 1960.
Costs against petitioners.
As to the finding of liability for exemplary damages, the Court of
Appeals, in its resolution of March 31, 1965, stated the following: "We
now come to the imposition of exemplary damages upon defendants- Concepcion, C.J., Dizon, Makalintal, Zaldivar Sanchez, Castro and
appellants' carrier. It is argued that this Court is without jurisdiction to Angeles, JJ., concur.
adjudicate this exemplary damages since there was no allegation nor Reyes, J.B.L., J., took no part.
prayer, nor proof, nor counterclaim of error for the same by the
appellees. It is to be observed however, that in the complaint,
plaintiffs "prayed for such other and further relief as this Court may
deem just and equitable." Now, since the body of the complaint
sought to recover damages against the defendant-carrier wherein
plaintiffs prayed for indemnification for the damages they suffered as
a result of the negligence of said Silverio Marchan who is appellant's
employee; and since exemplary damages is intimately connected
with general damages, plaintiffs may not be expected to single out by
express term the kind of damages they are trying to recover against
the defendant's carrier. Suffice it to state that when plaintiffs prayed
in their complaint for such other relief and remedies that may be
availed of under the premises, in effect, therefore, the court is called
upon the exercise and use its discretion whether the imposition of
punitive or exemplary damages even though not expressly prayed or
pleaded in the plaintiffs' complaint."9

In support of the above view, Singson v. Aragon was cited by the

Court of Appeals. 10 As was there held by this Court: "From the above
legal provisions it appears that exemplary damages may be imposed
by way of example or correction only in addition, among others, to
compensatory damages, but that they cannot be recovered as a
matter of right, their determination depending upon the discretion of
the court. It further appears that the amount of exemplary damages
need not be proved, because its determination depends upon the
amount of compensatory damages that may be awarded to the
claimant. If the amount of exemplary damages need not be proved, it
G.R. Nos. L-21353 and L-21354 May 20, 1966
GREGORIO ANURAN, MARIA MALIGAYA, LAPAZ LARO, ET
AL., petitioners,
vs.
PEPITO BUÑO, PEDRO GAHOL, LUISA ALCANTARA,
GUILLERMO RAZON, ANSELMO MALIGAYA and CEFERINA
ARO, respondents.
Victoriano A. Endaya for petitioners.
Trinidad and Borromeo for respondents Buño, et al.
Contreras and Adapon for respondents Razon, et al.
BENGZON, C.J.:
At noon of January 12, 1958, a passenger jeepney was parked on
the road to Taal, Batangas. A motor truck speeding along, negligently
bumped it from behind, with such violence that three of its
passengers died, even as two others (passengers too) suffered
injuries that required their confinement at the Provincial Hospital for
many days.
So, in February 1958 these suits were instituted by the
representatives of the dead and of the injured, to recover
consequently damages against the driver and the owners of the
truck and also against the driver and the owners of the jeepney.
The Batangas Court of First Instance, after trial, rendered judgment
absolving the driver of the jeepney and its owners, but it required the
truck driver and the owners thereof to make compensation.
The plaintiffs appealed to the Court of Appeals insisting that the
driver and the owners of the jeepney should also be made liable for
damages.
The last mentioned court, upon reviewing the record, declared that:
It is admitted that at about noontime on January 13, 1958,
the passenger jeepney owned by defendants spouses
Pedro Gahol and Luisa Alcantara, bearing plate No. TPU-
13548, then being driven by their regular driver, defendant
Pepito Buño was on its regular route travelling from
Mahabang Ludlud, Taal, Batangas, towards the poblacion
of the said municipality. When said passenger jeepney
crossed the bridge separating Barrios Mahabang Ludlud
and Balisong, Taal, Batangas, it had fourteen passengers,
excluding the driver, according to the testimony of
defendant Buño (pp. 12 and 18, t.s.n. July 17, 1958), or
sixteen passengers according to the testimony of plaintiff
Edita de Sagun, (pp. 9, 12 and 13, t.s.n. June 26, 1958).
However, the fact remains that the vehicle was overloaded
with passengers at the time, because according to the
partial stipulation of facts "the maximum capacity of the
jeepney bearing plate No. TPU-13548 of said defendants
was eleven (11) passengers including the driver. (Printed
Record on Appeal, pp. 35, 37.)
After crossing the bridge, defendant Buño stopped his
vehicle in order to allow one of his passengers to alight. But
he so parked his jeepney in such a way that one-half of its
width (the left wheels) was on the asphalted pavement of
the road and the other half, on the right shoulder of said
road (pp. 21-22, t.s.n. May 26, 1958; p. 12 t.s.n. July 17,
1958). Approximately five minutes later and before Buño
could start his vehicle, a speeding water truck, which bore
plate No. T-17526 and owned by defendants-spouses
Anselmo Maligaya and Ceferina Aro, then being driven by
Guillermo Razon from the direction of Mahabang Ludlud,
Taal, Batangas, towards the poblacion of that municipality,
violently smashed against the parked jeepney from behind,
causing it to turn turtle into a nearby ditch.
Then said Appellate Court went on to affirm the exoneration of the
jeepney driver and of its owners. It explained that although "the driver
of the ill-starred vehicle was not free from fault, for he was guilty of an
antecedent negligence in parking his vehicle with a portion thereof
occupying the asphalted road", it considered the truck driver guilty of
greater negligence which was the efficient cause of the collision; and
applying the doctrine of the "last clear chance"1 said Court ordered
the owners of the truck to pay, solidarily with its driver, damages as
follows:
x x x the sum of P6,000.00 for the death of their daughter
Emelita, another sum of P5,000.00 as moral damages and
the sum of P500.00 as actual damages, and to plaintiffs
Simplicio, Alberto, Avelina and Alfredo, all surnamed
Arriola, and represented by their guardian ad litem Agustin
Arriola, the sum of P6,000.00 for the death of their natural
mother, Leonor Masongsong, another sum of P5,000.00 as
moral damages the sum of P3,600.00 for loss of earning
capacity of said deceased and the sum of P850.00 as
actual damages.
The plaintiffs brought the matter to this Supreme Court insisting that
the driver and the owners of the jeepney should also be made liable.
We gave due course to the petition for review, because we thought
the decision meant exoneration of the carrier from liability to its
passengers, notwithstanding the negligence of its driver.
Upon further and more extended consideration of the matter, we
have become convinced that error of law was committed in releasing
the jeepney from liability. It must be remembered that the obligation
of the carrier to transport its passengers safely is such that the New
Civil Code requires "utmost diligence" from the carriers (Art. 1755)
who are "presumed to have been at fault or to have acted negligently,
unless they prove that they have observed extraordinary diligence"
(Art. 1756). In this instance, this legal presumption of negligence is
confirmed by the Court of Appeals' finding that the driver of the
jeepney in question was at fault in parking the vehicle improperly. It
must follow that the driver — and the owners — of the jeepney must
answer for injuries to its passengers.
The principle about the "last clear chance" would call for application
in a suit between the owners and drivers of the two colliding vehicles.
It does not arise where a passenger demands responsibility from the
carrier to enforce its contractual obligations. For it would be
inequitable to exempt the negligent driver of the jeepney and its
owners on the ground that the other driver was likewise guilty of
negligence.
Now as to damages. The driver and the owners of the truck have not
appealed from the Court of Appeals' assessment. The plaintiffs
(petitioners) have not asked here for a greater amount of indemnity.
They merely pray for a declaration that Pepito Buño, Pedro Gahol
and Luisa Alcantara (the driver and the owners of the jeepney,
respectively) be declared jointly and severally liable with the other
defendants.1äwphï1.ñët
Wherefore, affirming the decision under review, we hereby modify it
in the sense prayed for by plaintiffs-petitioners. The three defendants
last mentioned are required to pay solidarily with the other
defendants-respondents the amounts fixed by the appealed decision.
Costs of both appeals against said three defendants. So ordered.
Bautista Angelo, Concepcion, J.B.L. Reyes, Dizon, Regala,
Makalintal and Bengzon, J.P., JJ., concur.
Barrera, Zaldivar and Sanchez, JJ., took no part.
Footnotes
G.R. No. L-22985 January 24, 1968
BATANGAS TRANSPORTATION COMPANY, petitioner,
vs.
GREGORIO CAGUIMBAL, PANCRACIO CAGUIMBAL, MARIA
MARANAN DE CAGUIMBAL, BIÑAN TRANSPORTATION
COMPANY and MARCIANO ILAGAN, respondents.
Ozaeta, Gibbs and Ozaeta and Domingo E. de Lara for petitioner.
Victoriano H. Endaya for respondents.
CONCEPCION, C.J.:
Appeal by certiorari from a decision of the Court of Appeals.
The main facts are set forth in said decision from which we quote:
There is no dispute at all that the deceased Pedro
Caguimbal, Barrio Lieutenant of Barrio Calansayan, San
Jose, Batangas, was a paying passenger of BTCO bus,
with plate TPU-507, going south on its regular route from
Calamba, Laguna, to Batangas, Batangas, driven by
Tomas Perez, its regular driver, at about 5:30 o'clock on
the early morning of April 25, 1954. The deceased's
destination was his residence at Calansayan, San Jose,
Batangas. The bus of the Biñan Transportation Company,
bearing plate TPU-820, driven by Marciano Ilagan, was
coming from the opposite direction (north-bound). Along
the national highway at Barrio Daraza, Tanauan, Batangas,
on the date and hour above indicated, a horse-driven rig
(calesa) managed by Benito Makahiya, which was then
ahead of the Biñan bus, was also coming from the opposite
direction, meaning proceeding towards the north. As to
what transpired thereafter, the lower court chose to give
more credence to defendant Batangas Transportation
Company's version which, in the words of the Court a quo,
is as follows: "As the BTCO bus was nearing a house, a
passenger requested the conductor to stop as he was
going to alight, and when he heard the signal of the
conductor, the driver Tomas Perez slowed down his bus
swerving it farther to the right in order to stop; at this
juncture, a calesa, then driven by Benito Makahiya was at a
distance of several meters facing the BTCO bus coming
from the opposite direction; that at the same time the Biñan
bus was about 100 meters away likewise going northward
and following the direction of the calesa; that upon seeing
the Biñan bus the driver of the BTCO bus dimmed his light
as established by Magno Ilaw, the very conductor of the
Biñan bus at the time of the accident; that as
the calesa and the BTCO bus were passing each other
from the opposite directions, the Biñan bus following
the calesa swerved to its left in an attempt to pass between
the BTCO bus and the calesa; that without diminishing its
speed of about seventy (70) kilometers an hour, the Biñan
bus passed through the space between the BTCO bus and
the calesahitting first the left side of the BTCO bus with the
left front corner of its body and then bumped and struck
the calesa which was completely wrecked; that the driver
was seriously injured and the horse was killed; that the
second and all other posts supporting the top of the left
side of the BTCO bus were completely smashed and half of
the back wall to the left was ripped open. (Exhibits 1 and
2). The BTCO bus suffered damages for the repair of its
damaged portion.
As a consequence of this occurrence, two (2) passengers of BTCO
died, namely, Pedro Caguimbal and Guillermo Tolentino, apart from
others who were injured. The widow and children of Caguimbal
instituted the present action, which was tried jointly with a similar
action of the Tolentinos, to recover damages from the Batangas
Transportation Company, hereinafter referred to as BTCO. The latter,
in turn, filed a third-party complaint against the Biñan Transportation
Company — hereinafter referred to as Biñan — and its driver,
Marciano Ilagan. Subsequently, the Caguimbals amended their
complaint, to include therein, as defendants, said Biñan and Ilagan.
After appropriate proceedings, the Court of First Instance of
Batangas rendered a decision dismissing the complaint insofar as the
BTCO is concerned, without prejudice to plaintiff's right to sue Biñan
— which had stopped participating in the proceedings herein, owing
apparently, to a case in the Court of First Instance of Laguna for the
insolvency of said enterprise — and Ilagan, and without
pronouncement as to costs.
On appeal taken by the Caguimbals, the Court of Appeals reversed
said decision and rendered judgment for them, sentencing the BTCO,
Biñan and Ilagan to, jointly and severally, pay to the plaintiffs the
aggregate sum of P10,500.00 1 and the costs in both instances.
Hence, this appeal by BTCO, upon the ground that the Court of
Appeals erred: 1) in finding said appellant liable for damages; and 2)
in awarding attorney's fees.
In connection with the first assignment of error, we note that the
recklessness of defendant was, manifestly, a major factor in the
occurrence of the accident which resulted, inter alia, in the death of
Pedro Caguimbal. Indeed, as driver of the Biñan bus, he overtook
Benito Makahiya's horse-driven rig or calesa and passed between
the same and the BTCO bus despite the fact that the space available
was not big enough therefor, in view of which the Biñan bus hit the
left side of the BTCO bus and then the calesa. This notwithstanding,
the Court of Appeals rendered judgment against the BTCO upon the
ground that its driver, Tomas Perez, had failed to exercise the
"extraordinary diligence," required in Article 1733 of the new Civil
Code, "in the vigilance for the safety" of his passengers. 2
The record shows that, in order to permit one of them to disembark,
Perez drove his BTCO bus partly to the right shoulder of the road and
partly on the asphalted portion thereof. Yet, he could have and
should have seen to it — had he exercised "extraordinary diligence"
— that his bus was completely outside the asphalted portion of the
road, and fully within the shoulder thereof, the width of which being
more than sufficient to accommodate the bus. He could have and
should have done this, because, when the aforementioned
passenger expressed his wish to alight from the bus, Ilagan had seen
the aforementioned "calesa", driven by Makahiya, a few meters
away, coming from the opposite direction, with the Biñan bus about
100 meters behind the rig cruising at a good speed. 3 When Perez
slowed down his BTCO bus to permit said passenger to disembark,
he must have known, therefore, that the Biñan bus would overtake
the calesa at about the time when the latter and BTCO bus would
probably be on the same line, on opposite sides of the asphalted
portions of the road, and that the space between the BTCO bus and
the "calesa" would not be enough to allow the Biñan bus to go
through. It is true that the driver of the Biñan bus should have slowed
down or stopped, and, hence, was reckless in not doing so; but, he
had no especial obligations toward the passengers of the BTCO
unlike Perez whose duty was to exercise "utmost" or "extraordinary"
diligence for their safety. Perez was thus under obligation to avoid a
situation which would be hazardous for his passengers, and, make
their safety dependent upon the diligence of the Biñan driver. Such
obligation becomes more patent when we considered the fact — of
which the Court may take judicial cognizance — that our motor
vehicle drivers, particularly those of public service utilities, have not
distinguished themselves for their concern over the safety, the
comfort or the convenience of others. Besides, as correctly stated in
the syllabus to Brito Sy vs. Malate Taxicab & Garage, Inc., 4
In an action based on a contract of carriage, the court need
not make an express finding of fault or negligence on the
part of the carrier in order to hold it responsible to pay the
damages sought for by the passenger. By the contract of
carriage, the carrier assumes the express obligation to
transport the passenger to his destination safely and to
observe extraordinary diligence with a due regard for all the
circumstances, and any injury that might be suffered by the
passenger is right away attributable to the fault or
negligence of the carrier (Article 1756, new Civil Code).
This is an exception to the general rule that negligence
must be proved, and it is therefore incumbent upon the
carrier to prove that it has exercised extraordinary
diligence as prescribed in Articles 1733 and 1755 of the
new Civil Code.
In the case at bar, BTCO has not proven the exercise of
extraordinary diligence on its part. For this reason, the case of Isaac
vs. A. L. Ammen Trans. Co., Inc. 5 relied upon by BTCO, is not in
point, for, in said case, the public utility driver had done everything he
could to avoid the accident, and could not have possibly avoided it,
for he "swerved the bus to the very extreme right of the road," which
the driver, in the present case, had failed to do.
As regards the second assignment of error, appellant argues that the
award of attorney's fees is not authorized by law, because, of the
eleven (11) cases specified in Article 1208 of the new Civil Code,
only the fifth and the last are relevant to the one under consideration;
but the fifth case requires bad faith, which does not exist in the case
at bar. As regards the last case, which permits the award, "where the
court deems it just and equitable that attorney's fees . . . should be
recovered," it is urged that the evidence on record does not show the
existence of such just and equitable grounds.
have acted negligently, unless they prove that they
observed extraordinary diligence as prescribed in articles
1733 and 1755."
7"A common carrier is bound to carry the passengers safely
as far as human care and foresight can provide, using the
utmost diligence of very cautious persons, with due regard
for all the circumstances. This extraordinary diligence
required of common carriers is calculated to protect the
passengers from the tragic mishaps that frequently occur in
connection with rapid modern transportation. This high
standard of care is imperatively demanded by the
preciousness of human life and by the consideration that
every person must in every way be safeguarded against all
injury." (Report of the Code Commission, pp. 35-36.)

We, however, believe otherwise, for: (1) the accident in question took
place on April 25, 1954, and the Caguimbals have been constrained
to litigate for over thirteen (13) years to vindicate their rights; and (2)
it is high time to impress effectively upon public utility operators the
nature and extent of their responsibility in respect of the safety of
their passengers and their duty to exercise greater care in the
selection of drivers and conductor and in supervising the
performance of their duties, in accordance, not only with Article 1733
of the Civil Code of the Philippines, but, also, with Articles 1755 and
1756 thereof 6 and the spirit of these provisions, as disclosed by the
letter thereof, and elucidated by the Commission that drafted the
same. 7

WHEREFORE, the decision appealed from, should be, as it is

hereby, affirmed, with the costs of this instance against appellant
Batangas Transportation Company.

Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Angeles

and Fernando, JJ., concur.
Bengzon, J.P., J., took no part.

Footnotes

1 For funeral expenses P1,000

For the death of Pedro Caguimbal 6,000

For moral damages 2,000

For attorney's fees 1,500

P10,000

2"Art.
1733. Common carriers, from the nature of their
business and for reasons of public policy, are bound to
observe extraordinary diligence in the vigilance over the
goods and for the safety of the passengers transported by
them, according to all the circumstances of each case."

370 km. p.h.

4102 Phil. 482.

5101 Phil. 1046.

6"Art.1755. A common carrier is bound to carry the

passengers safely as far as human care and foresight can
provide, using the utmost diligence of very cautious
persons, with a due regard for all the circumstances."

"Art. 1756. In case of death of or injuries to passengers,

common carriers are presumed to have been at fault or to
G.R. No. L-56487 October 21, 1991 of: P10,000.00 for loss of employment and other opportunities; P10,000.00 for the cost of plastic surgery
for removal of the scar on her forehead; P30,000.00 for moral damages; and P1,000.00 as attorney's fees.

REYNALDA GATCHALIAN, petitioner,

vs. In defense, respondent averred that the vehicular mishap was due to force majeure, and that petitioner had

ARSENIO DELIM and the HON. COURT OF already been paid and moreover had waived any right to institute any action against him (private

APPEALS, respondents. respondent) and his driver, when petitioner Gatchalian signed the Joint Affidavit on 14 July 1973.

Pedro G. Peralta for petitioner. After trial, the trial court dismissed the complaint upon the ground that when petitioner Gatchalian signed
the Joint Affidavit, she relinquished any right of action (whether criminal or civil) that she may have had
against respondent and the driver of the mini-bus.
Florentino G. Libatique for private respondent.

On appeal by petitioner, the Court of Appeals reversed the trial court's conclusion that there had been a
valid waiver, but affirmed the dismissal of the case by denying petitioner's claim for damages:

FELICIANO, J.:

At noon time on 11 July 1973, petitioner Reynalda Gatchalian

We are not in accord, therefore, of (sic) the ground of the trial court's dismissal of the
boarded, as a paying passenger, respondent's "Thames" mini bus at
complaint, although we conform to the trial court's disposition of the case — its dismissal.
a point in San Eugenio, Aringay, La Union, bound for Bauang, of the
same province. On the way, while the bus was running along the
highway in Barrio Payocpoc, Bauang, Union, "a snapping sound" was IN VIEW OF THE FOREGOING considerations, there being no error committed by the

suddenly heard at one part of the bus and, shortly thereafter, the lower court in dismissing the plaintiff-appellant's complaint, the judgment of dismissal is

vehicle bumped a cement flower pot on the side of the road, went off hereby affirmed.

the road, turned turtle and fell into a ditch. Several passengers,
including petitioner Gatchalian, were injured. They were promptly Without special pronouncement as to costs.
taken to Bethany Hospital at San Fernando, La Union, for medical
treatment. Upon medical examination, petitioner was found to have
sustained physical injuries on the leg, arm and forehead, specifically
described as follows: lacerated wound, forehead; abrasion, elbow, SO ORDERED. 3
left; abrasion, knee, left; abrasion, lateral surface, leg, left. 1

In the present Petition for Review filed in forma pauperis, petitioner assails the decision of the Court of
On 14 July 1973, while injured. passengers were confined in the hospital, Mrs. Adela Delim, wife of
Appeals and ask this Court to award her actual or compensatory damages as well as moral damages.
respondent, visited them and later paid for their hospitalization and medical expenses. She also gave
petitioner P12.00 with which to pay her transportation expense in going home from the hospital. However,
before Mrs. Delim left, she had the injured passengers, including petitioner, sign an already prepared Joint We agree with the majority of the Court of Appeals who held that no valid waiver of her cause of action had
Affidavit which stated, among other things: been made by petitioner. The relevant language of the Joint Affidavit may be quoted again:

That we are no longer interested to file a complaint, criminal or civil against the said driver
and owner of the said Thames, because it was an accident and the said driver and owner of
the said Thames have gone to the extent of helping us to be treated upon our injuries.
(Emphasis supplied)
That we were passengers of Thames with Plate No. 52-222 PUJ Phil. 73 and victims after
the said Thames met an accident at Barrio Payocpoc Norte, Bauang, La Union while
passing through the National Highway No. 3;

That after a thorough investigation the said Thames met the accident due to mechanical A waiver, to be valid and effective, must in the first place be couched in clear and unequivocal terms which
defect and went off the road and turned turtle to the east canal of the road into a creek leave no doubt as to the intention of a person to give up a right or benefit which legally pertains to
causing physical injuries to us; A waiver may not casually be attributed to a person when the
him. 4

terms thereof do not explicitly and clearly evidence an intent to

xxx xxx xxx abandon a right vested in such person.

That we are no longer interested to file a complaint, criminal or civil against the said driver The degree of explicitness which this Court has required in purported
and owner of the said Thames, because it was an accident and the said driver and owner of waivers is illustrated in Yepes and Susaya v. Samar Express Transit
the said Thames have gone to the extent of helping us to be treated upon our injuries. (supra), where the Court in reading and rejecting a purported waiver
said:

. . . It appears that before their transfer to the Leyte

xxx xxx xxx 2
Provincial Hospital, appellees were asked to sign as, in
fact, they signed the document Exhibit I wherein they
stated that "in consideration of the expenses which said
operator has incurred in properly giving us the proper
medical treatment, we hereby manifest our desire to
(Emphasis supplied) waive any and all claims against the operator of the Samar
Express Transit."

xxx xxx xxx

Notwithstanding this document, petitioner Gathalian filed with the then Court of First Instance of La Union Even a cursory examination of the document mentioned
an action extra contractu to recover compensatory and moral damages. She alleged in the complaint that above will readily show that appellees did not actually
her injuries sustained from the vehicular mishap had left her with a conspicuous white scar measuring 1 by waive their right to claim damages from appellant for the
1/2 inches on the forehead, generating mental suffering and an inferiority complex on her part; and that as latter's failure to comply with their contract of carriage. All
a result, she had to retire in seclusion and stay away from her friends. She also alleged that the scar that said document proves is that they expressed a "desire"
diminished her facial beauty and deprived her of opportunities for employment. She prayed for an award to make the waiver — which obviously is not the same as
 making an actual waiver of their right. A waiver of the kind
invoked by appellant must be clear and
unequivocal (Decision of the Supreme Court of Spain of
July 8, 1887) — which is not the case of the one relied
upon in this appeal. (Emphasis supplied)
If we apply the standard used in Yepes and Susaya, we would have
to conclude that the terms of the Joint Affidavit in the instant case
cannot be regarded as a waiver cast in "clear and unequivocal"
terms. Moreover, the circumstances under which the Joint Affidavit
was signed by petitioner Gatchalian need to be considered. Petitioner
testified that she was still reeling from the effects of the vehicular
accident, having been in the hospital for only three days, when the
purported waiver in the form of the Joint Affidavit was presented to
her for signing; that while reading the same, she experienced
dizziness but that, seeing the other passengers who had also
suffered injuries sign the document, she too signed without bothering
to read the Joint Affidavit in its entirety. Considering these
circumstances there appears substantial doubt whether petitioner
understood fully the import of the Joint Affidavit (prepared by or at the
instance of private respondent) she signed and whether she actually
intended thereby to waive any right of action against private
respondent.
Finally, because what is involved here is the liability of a common
carrier for injuries sustained by passengers in respect of whose
safety a common carrier must exercise extraordinary diligence, we
must construe any such purported waiver most strictly against the
common carrier. For a waiver to be valid and effective, it must not be
contrary to law, morals, public policy or good
customs. 5 To uphold a supposed waiver of any right to claim
damages by an injured passenger, under circumstances like those
exhibited in this case, would be to dilute and weaken the standard of
extraordinary diligence exacted by the law from common carriers and
hence to render that standard unenforceable. 6 We believe such a
purported waiver is offensive to public policy.
Petitioner Gatchalian also argues that the Court of Appeals, having
by majority vote held that there was no enforceable waiver of her
right of action, should have awarded her actual or compensatory and
moral damages as a matter of course.
We have already noted that a duty to exercise extraordinary diligence
in protecting the safety of its passengers is imposed upon a common
carrier. 7 In case of death or injuries to passengers, a statutory
presumption arises that the common carrier was at fault or had acted
negligently "unless it proves that it [had] observed extraordinary
diligence as prescribed in Articles 1733 and 1755." 8 In fact, because
of this statutory presumption, it has been held that a court need not
even make an express finding of fault or negligence on the part of the
common carrier in order to hold it liable. 9 To overcome this
presumption, the common carrier must slow to the court that it had
exercised extraordinary diligence to prevent the injuries. 10 The
standard of extraordinary diligence imposed upon common carriers is
considerably more demanding than the standard of ordinary
diligence, i.e., the diligence of a good paterfamilias established in
respect of the ordinary relations between members of society. A
common carrier is bound to carry its passengers safely" as far as
human care and foresight can provide, using the utmost diligence of
a very cautious person, with due regard to all the circumstances". 11
Thus, the question which must be addressed is whether or not private respondent has successfully proved
that he had exercised extraordinary diligence to prevent the mishap involving his mini-bus. The records
before the Court are bereft of any evidence showing that respondent had exercised the extraordinary
diligence required by law. Curiously, respondent did not even attempt, during the trial before the court a
quo, to prove that he had indeed exercised the requisite extraordinary diligence. Respondent did try to
exculpate himself from liability by alleging that the mishap was the result of force majeure. But allegation is
not proof and here again, respondent utterly failed to substantiate his defense offorce majeure. To exempt
a common carrier from liability for death or physical injuries to passengers upon the ground of force
majeure, the carrier must clearly show not only that the efficient cause of the casualty was entirely
independent of the human will, but also that it was impossible to avoid. Any participation by the common
carrier in the occurrence of the injury will defeat the defense of force majeure. In Servando v. Philippine
the Court summed up the essential
Steam Navigation Company, 12
characteristics of force majeure by quoting with approval from
the Enciclopedia Juridica Española:
Thus, where fortuitous event or force majeure is the
immediate and proximate cause of the loss, the obligor is
exempt from liability non-performance. The Partidas, the
antecedent of Article 1174 of the Civil Code, defines "caso
fortuito" as 'an event that takes place by accident and could
not have been foreseen. Examples of this are destruction
of houses, unexpected fire, shipwreck, violence of robber.
In its dissertation on the phrase "caso fortuito" the
Enciclopedia Juridica Española says: 'In legal sense and,
consequently, also in relation to contracts, a "caso fortuito"
presents the following essential characteristics: (1) the
cause of the unforeseen and unexpected occurence, or of
the failure of the debtor to comply with his obligation, must
be independent of the human will; (2) it must be impossible
to foresee the event which constitutes the "caso fortuito", or
if it can be foreseen, it must be impossible to avoid; (3) the
occurrence must be such as to render it impossible for the
debtor to fulfill his obligation in a normal manner; and (4)
the obligor must be free from any participation in the
aggravation of the injury resulting to the creditor.
Upon the other hand, the record yields affirmative evidence of fault or
negligence on the part of respondent common carrier. In her direct
examination, petitioner Gatchalian narrated that shortly before the
vehicle went off the road and into a ditch, a "snapping sound" was
suddenly heard at one part of the bus. One of the passengers, an old
woman, cried out, "What happened?" ("Apay addan samet
nadadaelen?"). The driver replied, nonchalantly, "That is only
normal" ("Ugali ti makina dayta"). The driver did not stop to check if
anything had gone wrong with the bus. Moreover, the driver's reply
necessarily indicated that the same "snapping sound" had been
heard in the bus on previous occasions. This could only mean that
the bus had not been checked physically or mechanically to
determine what was causing the "snapping sound" which had
occurred so frequently that the driver had gotten accustomed to it.
Such a sound is obviously alien to a motor vehicle in good operating
condition, and even a modicum of concern for life and limb of
passengers dictated that the bus be checked and repaired. The
obvious continued failure of respondent to look after the
roadworthiness and safety of the bus, coupled with the driver's
refusal or neglect to stop the mini-bus after he had heard once again
the "snapping sound" and the cry of alarm from one of the
passengers, constituted wanton disregard of the physical safety of
the passengers, and hence gross negligence on the part of
respondent and his driver.
We turn to petitioner's claim for damages. The first item in that claim
relates to revenue which petitioner said she failed to realize because
of the effects of the vehicular mishap. Petitioner maintains that on the
day that the mini-bus went off the road, she was supposed to confer
with the district supervisor of public schools for a substitute teacher's
job, a job which she had held off and on as a "casual employee." The
Court of Appeals, however, found that at the time of the accident, she
was no longer employed in a public school since, being a casual
employee and not a Civil Service eligible, she had been laid off. Her
employment as a substitute teacher was occasional and episodic,
contingent upon the availability of vacancies for substitute teachers.
In view of her employment status as such, the Court of Appeals held
that she could not be said to have in fact lost any employment after
and by reason of the accident. 13 Such was the factual finding of the
Court of Appeals, a finding entitled to due respect from this Court.
Petitioner Gatchalian has not submitted any basis for overturning this
finding of fact, and she may not be awarded damages on the basis of
speculation or conjecture. 14
Petitioner's claim for the cost of plastic surgery for removal of the scar on her forehead, is another matter.
A person is entitled to the physical integrity of his or her body; if that integrity is violated or diminished,
actual injury is suffered for which actual or compensatory damages are due and assessable. Petitioner
Gatchalian is entitled to be placed as nearly as possible in the condition that she was before the mishap. A
scar, especially one on the face of the woman, resulting from the infliction of injury upon her, is a violation
of bodily integrity, giving raise to a legitimate claim for restoration to her conditio ante. If the scar is
relatively small and does not grievously disfigure the victim, the cost of surgery may be expected to be
correspondingly modest. In Araneta, et al. vs. Areglado, et al., 15 this Court awarded actual or
compensatory damages for, among other things, the surgical removal of the scar on the face of a young
boy who had been injured in a vehicular collision. The Court there held:
 We agree with the appellants that the damages awarded by the lower court for the injuries
suffered by Benjamin Araneta are inadequate. In allowing not more than P1,000.00 as
compensation for the "permanent deformity and — something like an inferiority complex" as
well as for the "pathological condition on the left side of the jaw" caused to said plaintiff, the
court below overlooked the clear evidence on record that to arrest the degenerative process
taking place in the mandible and restore the injured boy to a nearly normal condition,
surgical intervention was needed, for which the doctor's charges would amount to
P3,000.00, exclusive of hospitalization fees, expenses and medicines. Furthermore, the
operation, according to Dr. Diño, would probably have to be repeated in order to effectuate
a complete cure, while removal of the scar on the face obviously demanded plastic surgery.

xxx xxx xxx

The father's failure to submit his son to a plastic operation as soon as possible does not
prove that such treatment is not called for. The damage to the jaw and the existence of the
scar in Benjamin Araneta's faceare physical facts that can not be reasoned out of
existence. That the injury should be treated in order to restore him as far as possible to his
original condition is undeniable. The father's delay, or even his negligence, should not be
allowed to prejudice the son who has no control over the parent's action nor impair his right
to a full indemnity.

. . . Still, taking into account the necessity and cost of corrective measures to fully repair the
damage; the pain suffered by the injured party; his feelings of inferiority due to
consciousness of his present deformity, as well as the voluntary character of the injury
inflicted; and further considering that a repair, however, skillfully conducted, is never
equivalent to the original state, we are of the opinion that the indemnity granted by the trial
court should be increased to a total of P18,000.00. (Emphasis supplied)

Petitioner estimated that the cost of having her scar surgically removed was somewhere between

Upon the other hand, Dr. Fe Tayao Lasam, a

P10,000.00 to P15,000.00. 16

witness presented as an expert by petitioner, testified that the cost

would probably be between P5,000.00 to P10,000.00. 17 In view of
this testimony, and the fact that a considerable amount of time has
lapsed since the mishap in 1973 which may be expected to increase
not only the cost but also very probably the difficulty of removing the
scar, we consider that the amount of P15,000.00 to cover the cost of
such plastic surgery is not unreasonable.

Turning to petitioner's claim for moral damages, the long-established

rule is that moral damages may be awarded where gross negligence
on the part of the common carrier is shown. 18 Since we have earlier
concluded that respondent common carrier and his driver had been
grossly negligent in connection with the bus mishap which had
injured petitioner and other passengers, and recalling the aggressive
manuevers of respondent, through his wife, to get the victims to
waive their right to recover damages even as they were still
hospitalized for their injuries, petitioner must be held entitled to such
moral damages. Considering the extent of pain and anxiety which
petitioner must have suffered as a result of her physical injuries
including the permanent scar on her forehead, we believe that the
amount of P30,000.00 would be a reasonable award. Petitioner's
claim for P1,000.00 as atttorney's fees is in fact even more modest. 19

WHEREFORE, the Decision of the Court of Appeals dated 24 October 1980, as well as the decision of the
then Court of First Instance of La Union dated 4 December 1975 are hereby REVERSED and SET
ASIDE.Respondent is hereby ORDERED to pay petitioner Reynalda Gatchalian the following sums: 1)
P15,000.00 as actual or compensatory damages to cover the cost of plastic surgery for the removal of the
scar on petitioner's forehead; 2) P30,000.00 as moral damages; and 3) P1,000.00 as attorney's fees, the
aggregate amount to bear interest at the legal rate of 6% per annum counting from the promulgation of this
decision until full payment thereof. Costs against private respondent.

SO ORDERED.

Fernan, C.J., Gutierrez, Jr., Bidin and Davide, Jr., JJ., concur.
G.R. No. L-10126 October 22, 1957
SALUD VILLANUEVA VDA. DE BATACLAN and the minors
NORMA, LUZVIMINDA, ELENITA, OSCAR and ALFREDO
BATACLAN, represented by their Natural guardian, SALUD
VILLANUEVA VDA. DE BATACLAN, plaintiffs-appellants,
vs.
MARIANO MEDINA, defendant-appellant.
Lope E. Adriano, Emmanuel Andamo and Jose R. Francisco for
plaintiffs-appellants.
Fortunato Jose for defendant and appellant.
MONTEMAYOR, J.:
Shortly after midnight, on September 13, 1952 bus no. 30 of the
Medina Transportation, operated by its owner defendant Mariano
Medina under a certificate of public convenience, left the town of
Amadeo, Cavite, on its way to Pasay City, driven by its regular
chauffeur, Conrado Saylon. There were about eighteen passengers,
including the driver and conductor. Among the passengers were Juan
Bataclan, seated beside and to the right of the driver, Felipe Lara,
sated to the right of Bataclan, another passenger apparently from the
Visayan Islands whom the witnesses just called Visaya, apparently
not knowing his name, seated in the left side of the driver, and a
woman named Natalia Villanueva, seated just behind the four last
mentioned. At about 2:00 o'clock that same morning, while the bus
was running within the jurisdiction of Imus, Cavite, one of the front
tires burst and the vehicle began to zig-zag until it fell into a canal or
ditch on the right side of the road and turned turtle. Some of the
passengers managed to leave the bus the best way they could,
others had to be helped or pulled out, while the three passengers
seated beside the driver, named Bataclan, Lara and the Visayan and
the woman behind them named Natalia Villanueva, could not get out
of the overturned bus. Some of the passengers, after they had
clambered up to the road, heard groans and moans from inside the
bus, particularly, shouts for help from Bataclan and Lara, who said
they could not get out of the bus. There is nothing in the evidence to
show whether or not the passengers already free from the wreck,
including the driver and the conductor, made any attempt to pull out
or extricate and rescue the four passengers trapped inside the
vehicle, but calls or shouts for help were made to the houses in the
neighborhood. After half an hour, came about ten men, one of them
carrying a lighted torch made of bamboo with a wick on one end,
evidently fueled with petroleum. These men presumably approach
the overturned bus, and almost immediately, a fierce fire started,
burning and all but consuming the bus, including the four passengers
trapped inside it. It would appear that as the bus overturned, gasoline
began to leak and escape from the gasoline tank on the side of the
chassis, spreading over and permeating the body of the bus and the
ground under and around it, and that the lighted torch brought by one
of the men who answered the call for help set it on fire.
That same day, the charred bodies of the four deemed passengers
inside the bus were removed and duly identified that of Juan
Bataclan. By reason of his death, his widow, Salud Villanueva, in her
name and in behalf of her five minor children, brought the present
suit to recover from Mariano Medina compensatory, moral, and
exemplary damages and attorney's fees in the total amount of
P87,150. After trial, the Court of First Instance of Cavite awarded
P1,000 to the plaintiffs plus P600 as attorney's fee, plus P100, the
value of the merchandise being carried by Bataclan to Pasay City for
sale and which was lost in the fire. The plaintiffs and the defendants
appealed the decision to the Court of Appeals, but the latter
endorsed the appeal to us because of the value involved in the claim
in the complaint.
Our new Civil Code amply provides for the responsibility of common
carrier to its passengers and their goods. For purposes of reference,
we are reproducing the pertinent codal provisions:
ART. 1733. Common carriers, from the nature of their
business and for reasons of public policy, are bound to
observe extraordinary diligence in the vigilance over the
goods and for the safety of the passengers transported by
them, according to all the circumstances of each case.
Such extraordinary diligence in the vigilance over the
goods is further expressed in articles 1734, 1735, and
1745, Nos. 5, 6, and 7, while the extra ordinary diligence
for the safety of the passengers is further set forth in
articles 1755 and 1756.
ART. 1755. A common carrier is bound to carry the
passengers safely as far as human care and foresight can
provide, using the utmost diligence of very cautious
persons, with a due regard for all the circumstances.
ART. 1756. In case of death of or injuries to passengers,
common carriers are presumed to have been at fault or to
have acted negligently, unless they prove that they
observed extraordinary diligence as prescribed in articles
1733 and 1755
ART. 1759. Common carriers are liable for the death of or
injuries to passengers through the negligence or willful acts
of the former's employees, although such employees may
have acted beyond the scope of their authority or in
violation of the order of the common carriers.
This liability of the common carriers does not cease upon
proof that they exercised all the diligence of a good father
of a family in the selection and supervision of their
employees.
ART. 1763. A common carrier responsible for injuries
suffered by a passenger on account of the willful acts or
negligence of other passengers or of strangers, if the
common carrier's employees through the exercise of the
diligence of a good father of a family could have prevented
or stopped the act or omission.
We agree with the trial court that the case involves a breach of
contract of transportation for hire, the Medina Transportation having
undertaken to carry Bataclan safely to his destination, Pasay City.
We also agree with the trial court that there was negligence on the
part of the defendant, through his agent, the driver Saylon. There is
evidence to show that at the time of the blow out, the bus was
speeding, as testified to by one of the passengers, and as shown by
the fact that according to the testimony of the witnesses, including
that of the defense, from the point where one of the front tires burst
up to the canal where the bus overturned after zig-zaging, there was
a distance of about 150 meters. The chauffeur, after the blow-out,
must have applied the brakes in order to stop the bus, but because of
the velocity at which the bus must have been running, its momentum
carried it over a distance of 150 meters before it fell into the canal
and turned turtle.
There is no question that under the circumstances, the defendant
carrier is liable. The only question is to what degree. The trial court
was of the opinion that the proximate cause of the death of Bataclan
was not the overturning of the bus, but rather, the fire that burned the
bus, including himself and his co-passengers who were unable to
leave it; that at the time the fire started, Bataclan, though he must
have suffered physical injuries, perhaps serious, was still alive, and
so damages were awarded, not for his death, but for the physical
injuries suffered by him. We disagree. A satisfactory definition of
proximate cause is found in Volume 38, pages 695-696 of American
jurisprudence, cited by plaintiffs-appellants in their brief. It is as
follows:
. . . '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.' And more comprehensively, 'the proximate legal
cause is that acting first and producing the injury, either
immediately or by setting other events in motion, all
constituting a natural and continuous chain of events, each
having a close causal connection with its immediate
 predecessor, the final event in the chain immediately and with his consent, was provisionally dismissed, because
effecting the injury as a natural and probable result of the according to the fiscal, the witnesses on whose testimony he was
cause which first acted, under such circumstances that the banking to support the complaint, either failed or appear or were
person responsible for the first event should, as an ordinary reluctant to testify. But the record of the case before us shows the
prudent and intelligent person, have reasonable ground to several witnesses, passengers, in that bus, willingly and
expect at the moment of his act or default that an injury to unhesitatingly testified in court to the effect of the said driver was
some person might probably result therefrom. negligent. In the public interest the prosecution of said erring driver
should be pursued, this, not only as a matter of justice, but for the
It may be that ordinarily, when a passenger bus overturns, and pins promotion of the safety of passengers on public utility buses. Let a
down a passenger, merely causing him physical injuries, if through copy of this decision be furnished the Department of Justice and the
some event, unexpected and extraordinary, the overturned bus is set Provincial Fiscal of Cavite.
on fire, say, by lightning, or if some highwaymen after looting the
vehicle sets it on fire, and the passenger is burned to death, one In view of the foregoing, with the modification that the damages
might still contend that the proximate cause of his death was the fire awarded by the trial court are increased from ONE THOUSAND
and not the overturning of the vehicle. But in the present case under (P1,000) PESOS TO SIX THOUSAND (P6,000) PESOS, and from
the circumstances obtaining in the same, we do not hesitate to hold SIX HUNDRED PESOS TO EIGHT HUNDRED (P800) PESOS, for
that the proximate cause was the overturning of the bus, this for the the death of Bataclan and for the attorney's fees, respectively, the
reason that when the vehicle turned not only on its side but decision appealed is from hereby affirmed, with costs.
completely on its back, the leaking of the gasoline from the tank was
not unnatural or unexpected; that the coming of the men with a Paras, C. J., Bengzon, Padilla, Reyes, A., Bautista Angelo, Labrador,
lighted torch was in response to the call for help, made not only by Concepcion, Reyes, J. B. L., Endencia, and Felix, JJ., concur.
the passengers, but most probably, by the driver and the conductor
themselves, and that because it was dark (about 2:30 in the
morning), the rescuers had to carry a light with them, and coming as
they did from a rural area where lanterns and flashlights were not
available; and what was more natural than that said rescuers should
innocently approach the vehicle to extend the aid and effect the
rescue requested from them. In other words, the coming of the men
with a torch was to be expected and was a natural sequence of the
overturning of the bus, the trapping of some of its passengers and
the call for outside help. What is more, the burning of the bus can
also in part be attributed to the negligence of the carrier, through is
driver and its conductor. According to the witness, the driver and the
conductor were on the road walking back and forth. They, or at least,
the driver should and must have known that in the position in which
the overturned bus was, gasoline could and must have leaked from
the gasoline tank and soaked the area in and around the bus, this
aside from the fact that gasoline when spilled, specially over a large
area, can be smelt and directed even from a distance, and yet neither
the driver nor the conductor would appear to have cautioned or taken
steps to warn the rescuers not to bring the lighted torch too near the
bus. Said negligence on the part of the agents of the carrier come
under the codal provisions above-reproduced, particularly, Articles
1733, 1759 and 1763.

As regard the damages to which plaintiffs are entitled, considering

the earning capacity of the deceased, as well as the other elements
entering into a damage award, we are satisfied that the amount of
SIX THOUSAND (P6,000) PESOS would constitute satisfactory
compensation, this to include compensatory, moral, and other
damages. We also believe that plaintiffs are entitled to attorney's
fees, and assessing the legal services rendered by plaintiffs'
attorneys not only in the trial court, but also in the course of the
appeal, and not losing sight of the able briefs prepared by them, the
attorney's fees may well be fixed at EIGHT HUNDRED (P800)
PESOS for the loss of merchandise carried by the deceased in the
bus, is adequate and will not be disturbed.

There is one phase of this case which disturbs if it does not shock us.
According to the evidence, one of the passengers who, because of
the injuries suffered by her, was hospitalized, and while in the
hospital, she was visited by the defendant Mariano Medina, and in
the course of his visit, she overheard him speaking to one of his bus
inspectors, telling said inspector to have the tires of the bus changed
immediately because they were already old, and that as a matter of
fact, he had been telling the driver to change the said tires, but that
the driver did not follow his instructions. If this be true, it goes to
prove that the driver had not been diligent and had not taken the
necessary precautions to insure the safety of his passengers. Had he
changed the tires, specially those in front, with new ones, as he had
been instructed to do, probably, despite his speeding, as we have
already stated, the blow out would not have occurred. All in all, there
is reason to believe that the driver operated and drove his vehicle
negligently, resulting in the death of four of his passengers, physical
injuries to others, and the complete loss and destruction of their
goods, and yet the criminal case against him, on motion of the fiscal
G.R. No. 85691 July 31, 1990
BACHELOR EXPRESS, INCORPORATED, and CRESENCIO
RIVERA, petitioners,
vs.
THE HONORABLE COURT OF APPEALS (Sixth Division),
RICARDO BETER, SERGIA BETER, TEOFILO RAUTRAUT and
ZOETERA RAUTRAUT, respondents.
Aquino W. Gambe for petitioners.
Tranquilino O. Calo, Jr. for private respondents.
GUTIERREZ, JR., J.:
This is a petition for review of the decision of the Court of Appeals
which reversed and set aside the order of the Regional Trial Court,
Branch I, Butuan City dismissing the private respondents' complaint
for collection of "a sum of money" and finding the petitioners solidarily
liable for damages in the total amount of One Hundred Twenty
Thousand Pesos (P120,000.00). The petitioners also question the
appellate court's resolution denying a motion for reconsideration.
On August 1, 1980, Bus No. 800 owned by Bachelor Express, Inc.
and driven by Cresencio Rivera was the situs of a stampede which
resulted in the death of passengers Ornominio Beter and Narcisa
Rautraut.
The evidence shows that the bus came from Davao City on its way to
Cagayan de Oro City passing Butuan City; that while at Tabon-
Tabon, Butuan City, the bus picked up a passenger; that about fifteen
(15) minutes later, a passenger at the rear portion suddenly stabbed
a PC soldier which caused commotion and panic among the
passengers; that when the bus stopped, passengers Ornominio Beter
and Narcisa Rautraut were found lying down the road, the former
already dead as a result of head injuries and the latter also suffering
from severe injuries which caused her death later. The passenger
assailant alighted from the bus and ran toward the bushes but was
killed by the police. Thereafter, the heirs of Ornominio Beter and
Narcisa Rautraut, private respondents herein (Ricardo Beter and
Sergia Beter are the parents of Ornominio while Teofilo Rautraut and
Zoetera [should be Zotera] Rautraut are the parents of Narcisa) filed
a complaint for "sum of money" against Bachelor Express, Inc. its
alleged owner Samson Yasay and the driver Rivera.
In their answer, the petitioners denied liability for the death of
Ornominio Beter and Narcisa Rautraut. They alleged that ... the
driver was able to transport his passengers safely to their respective
places of destination except Ornominio Beter and Narcisa Rautraut
who jumped off the bus without the knowledge and consent, much
less, the fault of the driver and conductor and the defendants in this
case; the defendant corporation had exercised due diligence in the
choice of its employees to avoid as much as possible accidents; the
incident on August 1, 1980 was not a traffic accident or vehicular
accident; it was an incident or event very much beyond the control of
the defendants; defendants were not parties to the incident
complained of as it was an act of a third party who is not in any way
connected with the defendants and of which the latter have no control
and supervision; ..." (Rollo, pp. 112-113).i•t•c-aüsl
After due trial, the trial court issued an order dated August 8, 1985
dismissing the complaint.
Upon appeal however, the trial court's decision was reversed and set
aside. The dispositive portion of the decision of the Court of Appeals
states:
WHEREFORE, the Decision appealed from is
REVERSED and SET ASIDE and a new one
entered finding the appellees jointly and solidarily
liable to pay the plaintiffs-appellants the following
amounts:
1) To the heirs of Ornominio Beter, the amount of
Seventy Five Thousand Pesos (P75,000.00) in
loss of earnings and support, moral damages,
straight death indemnity and attorney's fees; and,
2) To the heirs of Narcisa Rautraut, the amount
of Forty Five Thousand Pesos (P45,000.00) for
straight death indemnity, moral damages and
attorney's fees. Costs against appellees. (Rollo,
pp. 71-72)
The petitioners now pose the following questions
What was the proximate cause of the whole
incident? Why were the passengers on board the
bus panicked (sic) and why were they shoving
one another? Why did Narcisa Rautraut and
Ornominio Beter jump off from the running bus?
The petitioners opine that answers to these questions are material to
arrive at "a fair, just and equitable judgment." (Rollo, p. 5) They claim
that the assailed decision is based on a misapprehension of facts
and its conclusion is grounded on speculation, surmises or
conjectures.
As regards the proximate cause of the death of Ornominio Beter and
Narcisa Rautraut, the petitioners maintain that it was the act of the
passenger who ran amuck and stabbed another passenger of the
bus. They contend that the stabbing incident triggered off the
commotion and panic among the passengers who pushed one
another and that presumably out of fear and moved by that human
instinct of self-preservation Beter and Rautraut jumped off the bus
while the bus was still running resulting in their untimely death."
(Rollo, p. 6) Under these circumstances, the petitioners asseverate
that they were not negligent in the performance of their duties and
that the incident was completely and absolutely attributable to a third
person, the passenger who ran amuck, for without his criminal act,
Beter and Rautraut could not have been subjected to fear and shock
which compelled them to jump off the running bus. They argue that
they should not be made liable for damages arising from acts of third
persons over whom they have no control or supervision.
Furthermore, the petitioners maintain that the driver of the bus,
before, during and after the incident was driving cautiously giving due
regard to traffic rules, laws and regulations. The petitioners also
argue that they are not insurers of their passengers as ruled by the
trial court.
The liability, if any, of the petitioners is anchored on culpa
contractual or breach of contract of carriage. The applicable
provisions of law under the New Civil Code are as follows:
ART. 1732. Common carriers are persons,
corporations, firms or associations engaged in
the business of carrying or transporting
passengers or goods or both by land, water, or
air, for compensation, offering their services to
the public.
ART. 1733. Common carriers, from the nature of
their business and for reasons of public policy,
are bound to observe extraordinary diligence in
the vigilance over the goods and for the safety of
the passengers transported by them, according
to all the circumstances of each case.
xxx xxx xxx
ART. 1755. A common carrier is bound to carry
the passengers safely as far as human care and
foresight can provide, using the utmost diligence
of very cautious persons, with a due regard for all
the circumstances.
 ART. 1756. In case of death of or injuries to
passengers, common carriers are presumed to
have been at fault or to have acted negligently,
unless they prove that they observed
extraordinary diligence as prescribed in Articles
1733 and 1755.
There is no question that Bachelor Express, Inc. is a common carrier.
Hence, from the nature of its business and for reasons of public
policy Bachelor Express, Inc. is bound to carry its passengers safely
as far as human care and foresight can provide using the utmost
diligence of very cautious persons, with a due regard for all the
circumstances.
In the case at bar, Ornominio Beter and Narcisa Rautraut were
passengers of a bus belonging to petitioner Bachelor Express, Inc.
and, while passengers of the bus, suffered injuries which caused
their death. Consequently, pursuant to Article 1756 of the Civil Code,
petitioner Bachelor Express, Inc. is presumed to have acted
negligently unless it can prove that it had observed extraordinary
diligence in accordance with Articles 1733 and 1755 of the New Civil
Code.
Bachelor Express, Inc. denies liability for the death of Beter and
Rautraut on its posture that the death of the said passengers was
caused by a third person who was beyond its control and
supervision. In effect, the petitioner, in order to overcome the
presumption of fault or negligence under the law, states that the
vehicular incident resulting in the death of passengers Beter and
Rautraut was caused by force majeure or caso fortuito over which the
common carrier did not have any control.
Article 1174 of the present Civil Code states:
Except in cases expressly specified by law, or
when it is otherwise declared by stipulations, or
when the nature of the obligation requires the
assumption of risk, no person shall be
responsible for those events which could not be
foreseen, or which though foreseen, were
inevitable.
The above-mentioned provision was substantially copied from Article
1105 of the old Civil Code which states"
No one shall be liable for events which could not
be foreseen or which, even if foreseen, were
inevitable, with the exception of the cases in
which the law expressly provides otherwise and
those in which the obligation itself imposes
liability.
In the case of Lasam v. Smith (45 Phil. 657 [1924]), we defined
"events" which cannot be foreseen and which, having been foreseen,
are inevitable in the following manner:
... The Spanish authorities regard the language
employed as an effort to define the term 'caso
fortuito' and hold that the two expressions are
synonymous. (Manresa Comentarios al Codigo
Civil Español, vol. 8, pp. 88 et seq.; Scaevola,
Codigo Civil, vol. 19, pp. 526 et seq.)
The antecedent to Article 1105 is found in Law II,
Title 33, Partida 7, which defines caso fortuito as
'occasion que acaese por aventura de que non
se puede ante ver. E son estos, derrivamientos
de casas e fuego que enciende a so ora, e
quebrantamiento de navio, fuerca de ladrones'
(An event that takes place by incident and could
not have been foreseen. Examples of this are
destruction of houses, unexpected fire,
shipwreck, violence of robbers ...)
Escriche defines caso fortuito as an unexpected
event or act of God which could neither be
foreseen nor resisted, such as floods, torrents,
shipwrecks, conflagrations, lightning, compulsion,
insurrections, destruction of buildings by
unforeseen accidents and other occurrences of a
similar nature.
In discussing and analyzing the term caso fortuito
the Enciclopedia Juridica Española says: 'In a
legal sense and, consequently, also in relation to
contracts, a caso fortuito presents the following
essential characteristics: (1) The cause of the
unforeseen and unexpected occurrence, or of the
failure of the debtor to comply with his obligation,
must be independent of the human will. (2) It
must be impossible to foresee the event which
constitutes the caso fortuito, or if it can be
foreseen, it must be impossible to avoid. (3) The
occurrence must be such as to render it
impossible for the debtor to fulfill his obligation in
a normal manner. And (4) the obligor (debtor)
must be free from any participation in the
aggravation of the injury resulting to the creditor.
(5) Enciclopedia Juridica Española, 309)
As will be seen, these authorities agree that
some extraordinary circumstance independent of
the will of the obligor or of his employees, is an
essential element of a caso fortuito. ...
The running amuck of the passenger was the proximate cause of the
incident as it triggered off a commotion and panic among the
passengers such that the passengers started running to the sole exit
shoving each other resulting in the falling off the bus by passengers
Beter and Rautraut causing them fatal injuries. The sudden act of the
passenger who stabbed another passenger in the bus is within the
context of force majeure.
However, in order that a common carrier may be absolved from
liability in case of force majeure, it is not enough that the accident
was caused by force majeure. The common carrier must still prove
that it was not negligent in causing the injuries resulting from such
accident. Thus, as early as 1912, we ruled:
From all the foregoing, it is concluded that the
defendant is not liable for the loss and damage of
the goods shipped on the lorcha Pilar by the
Chinaman, Ong Bien Sip, inasmuch as such loss
and damage were the result of a fortuitous event
or force majeure, and there was no negligence or
lack of care and diligence on the part of the
defendant company or its agents. (Tan Chiong
Sian v. Inchausti & Co., 22 Phil. 152 [1912];
Emphasis supplied).
This principle was reiterated in a more recent case, Batangas Laguna
Tayabas Co. v. Intermediate Appellate Court(167 SCRA 379 [1988]),
wherein we ruled:
... [F]or their defense of force majeure or act of
God to prosper the accident must be due to
natural causes and exclusively without human
intervention. (Emphasis supplied)
Therefore, the next question to be determined is whether or not the
petitioner's common carrier observed extraordinary diligence to
safeguard the lives of its passengers.
In this regard the trial court and the appellate court arrived at
conflicting factual findings.
The trial court found the following facts:
 The parties presented conflicting evidence as to Q When you said the conductor opened the door,
how the two deceased Narcisa Rautruat and the door at the front or rear portion of the bus?
Ornominio Beter met their deaths.
A Front door.
However, from the evidence adduced by the
plaintiffs, the Court could not see why the two Q And these two persons whom you said
deceased could have fallen off the bus when their alighted, where did they pass, the fron(t) door or
own witnesses testified that when the commotion rear door?
ensued inside the bus, the passengers pushed
and shoved each other towards the door
A Front door.
apparently in order to get off from the bus
through the door. But the passengers also could
not pass through the door because according to xxx xxx xxx
the evidence the door was locked.
(Tsn., p. 4, Aug. 8, 1984)
On the other hand, the Court is inclined to give
credence to the evidence adduced by the xxx xxx xxx
defendants that when the commotion ensued
inside the bus, the two deceased panicked and, Q What happened after there was a commotion
in state of shock and fear, they jumped off from at the rear portion of the bus?
the bus by passing through the window.
A When the commotion occurred, I stood up and
It is the prevailing rule and settled jurisprudence I noticed that there was a passenger who was
that transportation companies are not insurers of sounded (sic). The conductor panicked because
their passengers. The evidence on record does the passengers were shouting 'stop, stop'. The
not show that defendants' personnel were conductor opened the bus.'
negligent in their duties. The defendants'
personnel have every right to accept passengers (Tsn. p. 3, August 8, 1984).
absent any manifestation of violence or
drunkenness. If and when such passengers harm
Accordingly, there is no reason to believe that the
other passengers without the knowledge of the
deceased passengers jumped from the window
transportation company's personnel, the latter
when it was entirely possible for them to have
should not be faulted. (Rollo, pp. 46-47)
alighted through the door. The lower court's
reliance on the testimony of Pedro Collango, as
A thorough examination of the records, however, show that there are the conductor and employee of the common
material facts ignored by the trial court which were discussed by the carrier, is unjustified, in the light of the clear
appellate court to arrive at a different conclusion. These testimony of Leonila Cullano as the sole
circumstances show that the petitioner common carrier was negligent uninterested eyewitness of the entire episode.
in the provision of safety precautions so that its passengers may be Instead we find Pedro Collango's testimony to be
transported safely to their destinations. The appellate court states: infused by bias and fraught with inconsistencies,
if not notably unreliable for lack of veracity. On
A critical eye must be accorded the lower court's direct examination, he testified:
conclusions of fact in its tersely written ratio
decidendi. The lower court concluded that the xxx xxx xxx
door of the bus was closed; secondly, the
passengers, specifically the two deceased,
Q So what happened to the passengers inside
jumped out of the window. The lower court
your bus?
therefore concluded that the defendant common
carrier is not liable for the death of the said
passengers which it implicitly attributed to the A Some of the passengers jumped out of the
unforeseen acts of the unidentified passenger window.
who went amuck.
COURT:
There is nothing in the record to support the
conclusion that the solitary door of the bus was Q While the bus was in motion?
locked as to prevent the passengers from
passing through. Leonila Cullano, testifying for A Yes, your Honor, but the speed was slow
the defense, clearly stated that the conductor because we have just picked up a passenger.
opened the door when the passengers were
shouting that the bus stop while they were in a Atty. Gambe:
state of panic. Sergia Beter categorically stated
that she actually saw her son fall from the bus as
the door was forced open by the force of the Q You said that at the time of the incident the bus
onrushing passengers. was running slow because you have just picked
up a passenger. Can you estimate what was your
speed at that time?
Pedro Collango, on the other hand, testified that
he shut the door after the last passenger had
boarded the bus. But he had quite conveniently Atty. Calo:
neglected to say that when the passengers had
panicked, he himself panicked and had gone to No basis, your Honor, he is neither a driver nor a
open the door. Portions of the testimony of conductor.
Leonila Cullano, quoted below, are illuminating:
COURT:
xxx xxx xxx
 Let the witness answer. Estimate only, the
conductor experienced.
Witness:
Not less than 30 to 40 miles.
COURT:
Kilometers or miles?
A Miles.
Atty. Gambe:
Q That is only your estimate by your experience?
A Yes, sir, estimate.
(Tsn., pp. 4-5, Oct. 17, 1983).
At such speed of not less than 30 to 40 miles ...,
or about 48 to 65 kilometers per hour, the speed
of the bus could scarcely be considered slow
considering that according to Collango himself,
the bus had just come from a full stop after
picking a passenger (Tsn, p. 4, Id.) and that the
bus was still on its second or third gear (Tsn., p.
12, Id.).
In the light of the foregoing, the negligence of the
common carrier, through its employees,
consisted of the lack of extraordinary diligence
required of common carriers, in exercising
vigilance and utmost care of the safety of its
passengers, exemplified by the driver's belated
stop and the reckless opening of the doors of the
bus while the same was travelling at an
appreciably fast speed. At the same time, the
common carrier itself acknowledged, through its
administrative officer, Benjamin Granada, that the
bus was commissioned to travel and take on
passengers and the public at large, while
equipped with only a solitary door for a bus its
size and loading capacity, in contravention of
rules and regulations provided for under the Land
Transportation and Traffic Code (RA 4136 as
amended.) (Rollo, pp. 23-26)
Considering the factual findings of the Court of Appeals-the bus
driver did not immediately stop the bus at the height of the
commotion; the bus was speeding from a full stop; the victims fell
from the bus door when it was opened or gave way while the bus
was still running; the conductor panicked and blew his whistle after
people had already fallen off the bus; and the bus was not properly
equipped with doors in accordance with law-it is clear that the
petitioners have failed to overcome the presumption of fault and
negligence found in the law governing common carriers.
The petitioners' argument that the petitioners "are not insurers of their
passengers" deserves no merit in view of the failure of the petitioners
to prove that the deaths of the two passengers were exclusively due
to force majeure and not to the failure of the petitioners to observe
extraordinary diligence in transporting safely the passengers to their
destinations as warranted by law. (See Batangas Laguna Tayabas
Co. v. Intermediate Appellate Court, supra).
The petitioners also contend that the private respondents failed to
show to the court that they are the parents of Ornominio Beter and
Narcisa Rautraut respectively and therefore have no legal personality
to sue the petitioners. This argument deserves scant consideration.
We find this argument a belated attempt on the part of the petitioners
to avoid liability for the deaths of Beter and Rautraut. The private
respondents were Identified as the parents of the victims by
witnesses during the trial and the trial court recognized them as such.
The trial court dismissed the complaint solely on the ground that the
petitioners were not negligent.
Finally, the amount of damages awarded to the heirs of Beter and
Rautraut by the appellate court is supported by the evidence. The
appellate court stated:
Ornominio Beter was 32 years of age at the time
of his death, single, in good health and rendering
support and service to his mother. As far as
Narcisa Rautraut is concerned, the only evidence
adduced is to the effect that at her death, she
was 23 years of age, in good health and without
visible means of support.
In accordance with Art. 1764 in conjunction with
Art. 2206 of the Civil Code, and established
jurisprudence, several factors may be considered
in determining the award of damages, namely: 1)
life expectancy (considering the state of health of
the deceased and the mortality tables are
deemed conclusive) and loss of earning capacity;
(2) pecuniary loss, loss of support and service;
and (3) moral and mental suffering (Alcantara, et
al. v. Surro, et al., 93 Phil. 470).
In the case of People v. Daniel (No. L-66551,
April 25, 1985, 136 SCRA 92, at page 104), the
High Tribunal, reiterating the rule in Villa Rey
Transit, Inc. v. Court of Appeals (31 SCRA 511),
stated that the amount of loss of earring capacity
is based mainly on two 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 the heirs should be
fixed.
As the formula adopted in the case of Davila v.
Philippine Air Lines, 49 SCRA 497, at the age of
30 one's normal life expectancy is 33-1/3 years
based on the American Expectancy Table of
Mortality (2/3 x 80-32).i•t•c-aüsl By taking into
account the pace and nature of the life of a
carpenter, it is reasonable to make allowances
for these circumstances and reduce the life
expectancy of the deceased Ornominio Beter to
25 years (People v. Daniel, supra). To fix the rate
of losses it must be noted that Art. 2206 refers to
gross earnings less necessary living expenses of
the deceased, in other words, only net earnings
are to be considered (People v. Daniel, supra;
Villa Rey Transit, Inc. v. Court of Appeals, supra).
Applying the foregoing rules with respect to
Ornominio Beter, it is both just and reasonable,
considering his social standing and position, to fix
the deductible, living and incidental expenses at
the sum of Four Hundred Pesos (P400.00) a
month, or Four Thousand Eight Hundred Pesos
(P4,800.00) annually. As to his income,
considering the irregular nature of the work of a
daily wage carpenter which is seasonal, it is safe
to assume that he shall have work for twenty (20)
days a month at Twenty Five Pesos
(P150,000.00) for twenty five years. Deducting
therefrom his necessary expenses, his heirs
would be entitled to Thirty Thousand Pesos
(P30,000.00) representing loss of support and
service (P150,000.00 less P120,000.00). In
addition, his heirs are entitled to Thirty Thousand
Pesos (P30,000.00) as straight death indemnity
pursuant to Article 2206 (People v. Daniel,
supra). For damages for their moral and mental
anguish, his heirs are entitled to the reasonable
 sum of P10,000.00 as an exception to the
general rule against moral damages in case of
breach of contract rule Art. 2200 (Necesito v.
Paras, 104 Phil. 75). As attorney's fees, Beter's
heirs are entitled to P5,000.00. All in all, the
plaintiff-appellants Ricardo and Sergia Beter as
heirs of their son Ornominio are entitled to an
indemnity of Seventy Five Thousand Pesos
(P75,000.00).

In the case of Narcisa Rautraut, her heirs are

entitled to a straight death indemnity of Thirty
Thousand Pesos (P30,000.00), to moral
damages in the amount of Ten Thousand Pesos
(P10,000.00) and Five Thousand Pesos
(P5,000.00) as attorney's fees, or a total of Forty
Five Thousand Pesos (P45,000.00) as total
indemnity for her death in the absence of any
evidence that she had visible means of support.
(Rollo, pp. 30-31)

WHEREFORE, the instant petition is DISMISSED. The questioned

decision dated May 19, 1988 and the resolution dated August 1,
1988 of the Court of Appeals are AFFIRMED.

SO ORDERED.
G.R. No. L-9907 June 30, 1958
LOURDES J. LARA, ET AL., plaintiffs-appellants,
vs.
BRIGIDO R. VALENCIA, defendant-appellant.
Castillo, Cervantes, Occeña, Lozano, Montana, Cunanan, Sison and
Castillo and Eligio G. Lagman for defendant-appellant.
Donato C. Endriga and Emigdio Dakanay for plaintiffs-appellants.
BAUTISTA ANGELO, J.:
This is an action for damages brought by plaintiffs against defendant
in the Court of First Instance of Davao for the death of one Demetrio
Lara, Sr. allegedly caused by the negligent act of defendant.
Defendant denied the charge of negligence and set up certain
affirmative defenses and a counterclaim.
The court after hearing rendered judgment ordering defendant to pay
the plaintiffs the following amount: (a) P10,000 as moral damages;
(b) P3,000 as exemplary damages; and (c) P1,000 as attorney's fees,
in addition to the costs of action. Both parties appealed to this Court
because the damages claimed in the complaint exceed the sum of
P50,000.
In their appeal, plaintiffs claim that the court a quo erred in
disregarding their claim of P41,400 as actual or compensatory
damages and in awarding as attorneys' fees only the sum of P1,000
instead of P3,000 as agreed upon between plaintiffs and their
counsel. Defendant, on the other hand, disputes the finding of the
court a quo that the oath of Demetrio Lara, Sr. was due to the
negligence of defendant and the portion of the judgment which orders
dependant to pay to plaintiffs moral and exemplary damages as well
as attorneys' fees, said defendant contending that the court should
have declared that the death of Lara was due to unavoidable
accident.
The deceased was an inspector of the Bureau of Forestry stationed
in Davao with an annual salary of P1,800. The defendant is engaged
in the business of exporting logs from his lumber concession in
Cotabato. Lara went to said concession upon instructions of his chief
to classify the logs of defendant which were about to be loaded on a
ship anchored in the port of Parang. The work Lara of lasted for six
days during which he contracted malaria fever. In the morning of
January 9, 1954, Lara who then in a hurry to return to Davao asked
defendant if he could take him in his pick-up as there was then no
other means of transportation, to which defendant agreed, and in that
same morning the pick-up left Parang bound for Davao taking along
six passengers, including Lara.
The pick-up has a front seat where the driver and two passengers
can be accommodated and the back has a steel flooring enclosed
with a steel walling of 16 to 17 inches tall on the sides and with a 19
inches tall walling at the back. Before leaving Parang, the sitting
arrangement was as follows: defendant was at the wheel and seated
with him in the front seat were Mrs. Valencia and Nicanor Quinain; on
the back of the pick-up were two improvised benches placed on each
side, and seated on the right bench were Ricardo Alojipan and
Antonio Lagahit, and on the left one Bernardo and Pastor Geronimo.
A person by the name of Leoning was seated on a box located on the
left side while in the middle Lara sat on a bag. Before leaving Parang,
defendant invited Lara to sit with him on the front seat but Lara
declined. It was their understanding that upon reaching barrio
Samoay, Cotabato, the passengers were to alight and take a bus
bound for Davao, but when they arrived at that place, only Bernardo
alighted and the other passengers requested defendant to allow them
to ride with him up to Davao because there was then no available
bus that they could take in going to that place. Defendant again
accommodated the passengers.
When they continued their trip, the sitting arrangement of the
passengers remained the same, Lara being seated on a bag in the
middle with his arms on a suitcase and his head cove red by a jacket.
Upon reaching Km. 96, barrio Catidtuan, Lara accidentally fell from
the pick-up and as a result he suffered serious injuries. Valencia
stopped the pick-up to see what happened to Lara. He sought the
help of the residents of that place and applied water to Lara but to no
avail. They brought Lara to the nearest place where they could find a
doctor and not having found any they took him to St. Joseph's Clinic
of Kidapawan. But when Lara arrived he was already dead. From
there they proceeded to Davao City and immediately notified the
local authorities. An investigation was made regarding the
circumstances surrounding the death of Lara but no criminal action
was taken against defendant.
It should be noted that the deceased went to the lumber concession
of defendant in Parang, Cotabato upon instructions of his chief in
order to classify the logs of defendant which were then ready to be
exported and to be loaded on a ship anchored in the port of Parang.
It took Lara six days to do his work during which he contracted
malaria fever and for that reason he evinced a desire to return
immediately to Davao. At that time, there was no available bus that
could take him back to Davao and so he requested the defendant if
he could take him in his own pick-up. Defendant agreed and,
together with Lara, other passengers tagged along, most of them
were employees of the Government. Defendant merely
accommodated them and did not charge them any fee for the
service. It was also their understanding that upon reaching barrio
Samoay, the passengers would alight and transfer to a bus that
regularly makes the trip to Davao but unfortunately there was none
available at the time and so the same passengers, including Lara,
again requested the defendant to drive them to Davao. Defendant
again accommodated them and upon reaching Km. 96, Lara
accidentally fell suffering fatal injuries.
It therefore appears that the deceased, as well his companions who
rode in the pick-up of defendant, were merely accommodation
passengers who paid nothing for the service and so they can be
considered as invited guests within the meaning of the law. As
accommodation passengers or invited guests, defendant as owner
and driver of the pick-up owes to them merely the duty to exercise
reasonable care so that they may be transported safely to their
destination. Thus, "The rule is established by the weight of authority
that the owner or operator of an automobile owes the duty to
an invited guest to exercise reasonable care in its operation, and not
unreasonably to expose him to danger and injury by increasing the
hazard of travel. This rule, as frequently stated by the courts, is that
an owner of an automobile owes a guest the duty to exercise
ordinary or reasonable care to avoid injuring him. Since one riding in
an automobile is no less a guest because he asked for the privilege
of doing so, the same obligation of care is imposed upon the driver
as in the case of one expressly invited to ride" (5 Am. Jur., 626-627).
Defendant, therefore, is only required to observe ordinary care, and
is not in duty bound to exercise extraordinary diligence as required of
a common carrier by our law (Articles 1755 and 1756, new Civil
Code).
The question that now arises is: Is there enough evidence to show
that defendant failed to observe ordinary care or diligence in
transporting the deceased from Parang to Davao on the date in
question?
The trial court answered the question in the affirmative but in so
doing it took into account only the following facts:
No debe perderse de vista el hecho, que los negocios de
exportacion de trozos del demandado tiene un volumen de
P1,200. Lara era empleado de la Oficina de Montes,
asalariado por el gobierno, no pagado por el demandado
para classificar los trozos exportados; debido a los trabajos
de classificacion que duro 6 dias, en su ultimo dia Lara no
durmio toda la noche, al dia siguiente, Lara fue atacado de
malaria, tenia inflamada la cara y cuerpo, sufria dolores de
cabeza con erupciones en la cara y cuerpo; que en la
manana, del dia 2 de enero de 1954, fecha en que Lara
salio de Davao para Parang, en aeroplano para clasificar
los trozos del demandado, el automobil de este condujo a
aquel al aerodromo de Davao.
xxx xxx xxx
 El viaje de Cotabato a Davao no es menos de 8 horas, su Wherefore, the decision appealed from is reversed, without
carretera esta en malas condiciones, desnivelada, con pronouncement as to costs.
piedras salientes y baches, que hacen del vehiculo no
estable en su marcha. Lara estaba enfermo de cierta Paras, C. J., Bengzon, Reyes, A., Concepcion, Reyes, J. B. L.,
gravedad, tenia el cuerpo y cara inflamados, atacado de Endencia and Felix, JJ., concur.
malaria, con dolores de cabeza y con erupciones en la
cara y cuerpo.

A la vista de estos hechos, el demandado debia de saber

que era sumamente peligroso llevar 5 pasajeros en la parte
trasera del pick-up; particularmente, para la salud de Lara;
el permitirlo, el demandado no ha tomado las
precausiones, para evitar un posible accidente fatal. La
negative de Lara de ocupar el asiento delantero del pick-up
no constituye a juicio del Juzgado una defensa, pues el
demendado conociendo el estado delicado de salud de
Lara, no debio de haber permitido que aquel regrese a
Davao en su pick-up; si querria prestar a aquel un favor,
debio de haver provisto a Lara de un automobil para su
regrese a Davao, ya que el demendado es un millionario; si
no podia prestar a aquel este favor, debio de haver dejado
a Lara en Samuay para coger aquel un camion de pasajero
de Cotabato a Davao.

Even if we admit as true the facts found by the trial court, still we find
that the same are not sufficient to show that defendant has failed to
take the precaution necessary to conduct his passengers safely to
their place of destination for there is nothing there to indicate that
defendant has acted with negligence or without taking the precaution
that an ordinary prudent man would have taken under similar
circumstances. It should be noted that Lara went to the lumber
concession of defendant in answer to a call of duty which he was
bound to perform because of the requirement of his office and he
contracted the malaria fever in the course of the performance of that
duty. It should also be noted that defendant was not in duty bound to
take the deceased in his own pick-up to Davao because from Parang
to Cotabato there was a line of transportation that regularly makes
trips for the public, and if defendant agreed to take the deceased in
his own car, it was only to accommodate him considering his feverish
condition and his request that he be so accommodated. It should also
be noted that the passengers who rode in the pick-up of defendant
took their respective seats therein at their own choice and not upon
indication of defendant with the particularity that defendant invited the
deceased to sit with him in the front seat but which invitation the
deceased declined. The reason for this can only be attributed to his
desire to be at the back so that he could sit on a bag and travel in a
reclining position because such was more convenient for him due to
his feverish condition. All the circumstances therefore clearly indicate
that defendant had done what a reasonable prudent man would have
done under the circumstances.

There is every reason to believe that the unfortunate happening was

only due to an unforeseen accident accused by the fact that at the
time the deceased was half asleep and must have fallen from the
pick-up when it ran into some stones causing it to jerk considering
that the road was then bumpy, rough and full of stones.

The finding of the trial court that the pick-up was running at more
than 40 kilometers per hour is not supported by the evidence. This is
a mere surmise made by the trial court considering the time the pick-
up left barrio Samoay and the time the accident occured in relation to
the distance covered by the pick-up. And even if this is correct, still
we say that such speed is not unreasonable considering that they
were traveling on a national road and the traffic then was not heavy.
We may rather attribute the incident to lack of care on the part of the
deceased considering that the pick-up was open and he was then in
a crouching position. Indeed, the law provides that "A passenger
must observe the diligence of a good father of a family to avoid injury
to himself" (Article 1761, new Civil Code), which means that if the
injury to the passenger has been proximately caused by his own
negligence, the carrier cannot be held liable.

All things considered, we are persuaded to conclude that the

accident occurred not due to the negligence of defendant but to
circumstances beyond his control and so he should be exempt from
liability.
G.R. No. L-8034 November 18, 1955
CORNELIA A. DE GILLACO, ET AL., plaintiffs-appellees,
vs.
MANILA RAILROAD COMPANY, defendant-appellant.
First Assistant Corporate Counsel Federico C. Alikpala and Attorney
Higino R. Francisco for appellant.
Restituto Luna for appellees.
REYES, J.B.L., J.:
The Manila Railroad Company has appealed from a judgment of the
Court of First Instance of Laguna sentencing it to pay P4,000
damages to the appellees herein, the widow and children of the late
Tomas Gillaco, shot by an employee of the Company in April, 1946.
The judgment was rendered upon the following stipulation of facts:
That at about 7:30 a.m., on the morning of April 1, 1946,
Lieut. Tomas Gillaco, husband of the plaintiff, was a
passenger in the early morning train of the Manila Railroad
Company from Calamba, Laguna to Manila;
That when the train reached the Paco Railroad station,
Emilio Devesa, a train guard of the Manila Railroad
Company assigned in the Manila-San Fernando, La Union
Line, happened to be in said station waiting for the same
train which would take him to Tutuban Station, where he
was going to report for duty;
That Emilio Devesa had a long standing personal grudge
against Tomas Gillaco, same dating back during the
Japanese occupation;
That because of this personal grudge, Devesa shot Gillaco
with the carbine furnished to him by the Manila Railroad
Company for his use as such train guard, upon seeing him
inside the train coach;
That Tomas Gillaco died as a result of the would which he
sustained from the shot fired by Devesa.
It is also undisputed that Devesa was convicted with homicide by
final judgment of the Court of Appeals.
Appellant's contention is that, on the foregoing facts, no liability
attaches to it as employer of the killer, Emilio Devesa; that it is not
responsible subsidiary ex delicto, under Art. 103 of the Revised
Penal Code, because the crime was not committed while the slayer
was in the actual performance of his ordinary duties and service; nor
is it responsible ex contractu, since the complaint did not aver
sufficient facts to establish such liability, and no negligence on
appellant's party was shown. The Court below held the Railroad
company responsible on the ground that a contract of transportation
implies protection of the passengers against acts of personal
violence by the agents or employees of the carrier.
There can be no quarrel with the principle that a passenger is entitled
to protection from personal violence by the carrier or its agents or
employees, since the contract of transportation obligates the carrier
to transport a passenger safely to his destination. But under the law
of the case, this responsibility extends only to those that the carrier
could foresee or avoid through the exercise of the degree of car and
diligence required of it.
Discussing the basis of a carrier's liability under the old Civil Code of
1889 (which was in force in 1946, when Gillaco was shot) this Court
said in Lasam vs. Smith (45 Phil., 657):
In our opinion, the conclusions of the court below are
entirely correct. That upon the facts stated the defendant's
liability, if any, is contractual, is well settled by previous
decisions of the court, beginning with the case of
Rakes vs. Atlantic, Gulf & Pacific Co. (7 Phil., 359), and the
distinction between extra-contractual liability and
contractual liability has been so ably and exhaustively
discussed in various other cases that nothing further need
here be said upon that subject. (See Cangco vs. Manila
Railroad Co., 38 Phil., 768; Manila Railroad vs. Compañia
Transatlantica and Atlantic, Gulf & Pacific Co., 38 Phil.,
875; De Guia vs. Manila Electric Railroad & Light Co., 40
Phil., 706). It is sufficient to reiterate that the source of the
defendant's legal liability is the contract of carriage; that by
entering into that contract he bound himself to carry the
plaintiff safely and securely to their destination; and that
having failed to do so he is liable in damages unless he
shows that the failure to fulfill his obligation was due to
causes mentioned in article 1105 of the Civil Code, which
reads as follows:
"No one shall be liable for events which could not be
foreseen or which, even if foreseen, were inevitable, with
the exception of the cases in which the law expressly
provides otherwise and those in which the obligation itself
imposes such liability."
The act of guard Devesa in shooting passenger Gillaco (because of a
personal grudge nurtured against the latter since the Japanese
occupation) was entirely unforeseeable by the Manila Railroad Co.
The latter had no means to ascertain or anticipate that the two would
meet, nor could it reasonably foresee every personal rancor that
might exist between each one of its many employees and any one of
the thousands of eventual passengers riding in its trains. The
shooting in question was therefore "caso fortuito" within the definition
of article 105 of the old Civil Code, being both unforeseeable and
inevitable under the given circumstances; and pursuant to
established doctrine, the resulting breach of appellant's contract of
safe carriage with the late Tomas Gillaco was excused thereby.
No doubt that a common carrier is held to a very high degree of care
and diligence in the protection of its passengers; but, considering the
vast and complex activities of modern rail transportation, to require of
appellant that it should guard against all possible misunderstanding
between each and every one of its employees and every passenger
that might chance to ride in its conveyances at any time, strikes us as
demanding diligence beyond what human care and foresight can
provide.
The lower Court and the appellees both relied on the American
authorities that particularly hold carriers to be insurers of the safety of
their passengers against willful assault and intentional ill treatment on
the part of their servants, it being immaterial that the act should be
one of private retribution on the part of the servant, impelled by
personal malice toward the passenger (10 Am. Jur. 108; Ed. Note to
Gassenheimer vs. Wester R. Co. 40 LRA (NS), p. 999, et seq.) But
as can be inferred from the previous jurisprudence of this Court , the
Civil Code of 1889 did not impose such absolute liability
(Lasam vs. Smith, supra). The liability of a carrier as an insurer was
not recognized in this jurisdiction (Government vs. Inchausti & Co.,
40 Phil., 219; Oriental Comm. Co. vs. Naviera Filipina, 38 Off. Gaz.,
1020).
Another very important consideration that must be borne in mind is
that, when the crime took place, the guard Devesa had no duties to
discharge in connection with the transportation of the deceased from
Calamba to Manila. The stipulation of facts is clear that when Devesa
shot and killed Gillaco, Devesa was assigned to guard the Manila-
San Fernando (La Union) trains, and he was at Paco Station awaiting
transportation to Tutuban, the starting point of the train that he was
engaged to guard. In fact, his tour of duty was to start at 9:00 a.m.,
two hours after the commission of the crime. Devesa was therefore
under no obligation to safeguard the passenger of the Calamba-
Manila train, where the deceased was riding; and the killing of Gillaco
was not done in line of duty. The position of Devesa at the time was
that of another would be passenger, a stranger also awaiting
transportation, and not that of an employee assigned to discharge
any of the duties that the Railroad had assumed by its contract with
the deceased. As a result, Devesa's assault cannot be deemed in law
a breach of Gillaco's contract of transportation by a servant or
employee of the carrier. We agree with the position taken by the
Supreme Court of Texas in a similar case, where it held:

The only good reason for making the carrier responsible for
the misconduct of the servant perpetrated in his own
interest, and not in that of his employer, or otherwise within
the scope of his employment, is that the servant is clothed
with the delegated authority, and charge with the duty by
the carrier, to execute his undertaking with the passenger.
And it cannot be said, we think, that there is any such
delegation to the employees at a station with reference to
passenger embarking at another or traveling on the train.
Of course, we are speaking only of the principle which
holds a carrier responsible for wrong done to passenger by
servants acting in their own interest, and not in that of the
employer. That principle is not the ordinary rule,respondent
superior, by which the employer is held responsible only for
act or omissions of the employee in the scope of his
employment; but the only reason in our opinion for a
broader liability arises from the fact that the servant, in
mistreating the passenger wholly for some private purpose
of his own, in the very act, violates the contractual
obligation of the employer for the performance of which he
has put the employee in his place. The reason does not
exist where the employee who committed the assault was
never in a position in which it became his duty to his
employer to represent him in discharging any duty of the
latter toward the passenger. The proposition that the carrier
clothes every employee engaged in the transportation
business with the comprehensive duty of protecting every
passenger with whom he may in any way come in contact,
and hereby makes himself liable for every assault
commited by such servant, without regard to the inquiry
whether or not the passenger has come within the sphere
of duty of that servant as indicated by the employment, is
regarded as not only not sustained by the authorities, but
as being unsound and oppressive both to the employer and
the employee. (Houston & T. C. R. Co. vs. Bush, 32 LRA
(NS), p. 1205.)

Wherefore, the judgment appealed from is reversed and the

complaint ordered dismissed, without cost. So ordered.

Bengzon, Padilla, Montemayor, Reyes, A., Jugo, Bautista Angelo,

and Concepcion, JJ., concur.
 THIRD DIVISION
[G.R. No. 93291. March 29, 1999]
SULPICIO LINES, INC. and CRESENCIO G.
CASTANEDA, petitioners, vs. COURT OF APPEALS
and AQUARIUS FISHING CO., INC., respondents.
SYNOPSIS
On November 18, 1978, while the weather was good and the
visibility was clear, passenger liner M/V Don Sulpicio sighted two
fishing boats ahead at the distance of about four (4) miles. The two
boats, later known to be F/B Aquarius C and F/B Aquarius G; were
running at a speed of 7.5 to 8 knots per hour while M/V Don Sulpicio
was running at 15.5 knots per hour toward the direction of the two
boats. When it caught up with them, it collided with F/B Aquarius G
that resulted in the sinking of the latter. Before the RTC of Bacolod
City, the owner of the ill-fated fishing boats, Aquarius Fishing Co.,
Inc., filed a complaint for damages against Sulpicio Lines, Inc., owner
of the passenger liner. On May 30, 1986, the RTC came out with a
decision in favor of the plaintiff. The CA affirmed the RTC
decision. In its appeal before the Supreme Court, petitioner
contended that under the Rules of the Road and Regulations on the
Prevention of Collission, M/V Don Sulpicio was the priviledged vessel
and the F/B Aquarius was the burdened vessel in the crossing
situation. However, the latter violated the rules, did not keep out of
the way, did not slacken speed but instead went full ahead and cross
the bow of M/V Don Sulpicio.
The Supreme Court ruled that whether or not the collision
occurred in a crossing situation or not is immaterial. The duty to
keep out of the way remained even if the overtaking vessel cannot
determine with certainty whether she is forward of or abaft more than
two points from the vessel. M/V Don Sulpicio must assume
responsibility as it was in a better position to avoid the collision. It
cannot claim that it was a privileged vessel being in the portside
which can maintain its course and speed during the collision. Its
stance that F/B Aquarius G was a burdened vessel which should
have kept out of M/V Don Sulpicios way was not supported by
facts.
SYLLABUS
1. REMEDIAL LAW; CIVIL PROCEDURE; FINDINGS OF FACTS
OF THE TRIAL COURT, BINDING ON APPEAL. Well-settled
to the point of being elementary is the doctrine that the findings
by the trial court are binding on the appellate court and will not
be disturbed on appeal, unless the trial court has overlooked or
ignored some fact or circumstance of sufficient weight or
significance which, if considered, would alter the
situation. After a thorough review and examination of the
evidence on hand, we discern no ground or basis for
disregarding the findings and conclusion arrived at below.
2. MERCANTILE LAW; TRANSPORTATION; REGULATIONS FOR
PREVENTING COLLISIONS AT SEA; DUTY TO KEEP OUT
OF WAY REMAINS WITH OVERTAKING VESSEL. Whether
or not the collision sued upon occurred in a crossing situation is
immaterial as the Court of Appeals, relying on Rule 24-C,
Regulations for Preventing Collisions at the Sea, ruled that the
duty to keep out of the way remained even if the overtaking
vessel cannot determine with certainty whether she is forward
of or abaft more than 2 points from the vessel. It is beyond
cavil that M/V Don Sulpicio must assume responsibility as it
was in a better position to avoid the collision. It should have
blown its horn or given signs to warn the other vessel that it
was to overtake it. Assuming argumenti ex gratia that F/B
Aquarius G had no lookout during the collision, the omission
does not suffice to exculpate Sulpicio Lines from liability. M/V
Don Sulpicio cannot claim that it was a privileged vessel being
in the portside which can maintain its course and speed during
the collision. When it overtook F/B Aquarius G, it was duty
bound to slacken its speed and keep away from other vessels,
which it failed to do. The stance of petitioners that F/B
Aquarius G is a burdened vessel which should have kept out of
the way of M/V Don Sulpicio is not supported by facts.
3. CIVIL LAW; DAMAGES; AWARD OF ACTUAL DAMAGES
PROPER IN CASE AT BAR. Anent the award of actual
damage in the amount of P564,448.80, petitioners mere
allegation that the award of actual damages is exaggerated and
speculative, without controverting the receipts and invoices
when the boat was constructed and which were the bases of
accounting entries in the books of accounts presented by the
private respondent, are unavailing to defeat the award. To be
sure, the private respondent amply established the
compensatory damages it suffered by reason of the collision.
4. ID.; ID.; AMOUNT OF UNREALIZED PROFIT; TOO UNCERTAIN
AND ONEROUS IN CASE AT BAR. The P10,000.00 a month
awarded by the trial court and the respondent court, for
earnings that would have been derived from FIB Aquarius
G, without indicating the material period is too uncertain and
onerous to deserve serious consideration. As regards the
reckoning period, there is tenability in petitioners submission
that a fishing boat deteriorates quite quickly due to exposure to
the elements. To hold Sulpicio Lines to pay the profits that
would have been realized by the private respondent for an
unlimited period of time is to burden it indefinitely, which cannot
be countenanced. Failure of Aquarius Fishing Co., Inc. to
come forward with controverting evidence to the allegation of
Sulpicio Lines that the ordinary lifespan of a fishing vessel is
more than ten (10) years, amounted to an admission of such
allegation. The vessel was constructed in 1972 while the
collision occurred in 1978. The remaining life span of F/B
Aquarius G was therefore four (4) years. Conformably,
computed at P 10,000.00 per month for a period of four (4)
years, the unrealized profits/earnings involved, amounted to at
most P480,000.00.
5. ID.; ID.; ATTORNEYS FEES; AWARD THEREOF IN CASE AT
BAR, PROPER. As regards the attorneys fees equivalent to
15% of all the awards granted by the Regional Trial Court, the
propriety thereof cannot be questioned. Gross and evident bad
faith on the part of petitioner in refusing to pay the claim sued
upon constrained the private respondent to enlist the services
of a lawyer to litigate. Petitioner must have placed reliance on
the general rule that attorneys fees cannot be recovered as
part of damages because of the policy that no premium should
be placed on the right to litigate. (Philtranco Service
Enterprises, Inc. v. Court of Appeals, 273 SCRA 562; Morales
v. Court of Appeals, 274 SCRA 282). But the aforecited rule is
inapplicable here in the face of the stubborn refusal of
petitioner to respect the valid claim of the private respondent.
6. ID.; OBLIGATIONS AND CONTRACTS; PAYMENT OF LEGAL
INTEREST PROPER, IN CASE AT BAR. The payment of legal
interest is also in order. But it should be computed from
November 18, 1978, not from March 30, 1986, when the
Regional Trial Court a quo came out with its Decision. It was
from the time of the collision complained of that the private
respondent began to be deprived of subject vessel.
D E C I S I ON
PURISIMA, J.:
At bar is a Petition for Review on Certiorari under Rule 45 of
the Revised Rules of Court seeking the reversal of the Decision,
dated November 29, 1989, of the Court of Appeals[1] in CA GR No.
15081, and the Resolution, dated April 24, 1990, denying petitioners
Motion for Reconsideration.
The facts that matter are as follows:
The case stemmed from a complaint for damages of Aquarius
Fishing Co., Inc. against Sulpicio Lines, Inc. and Cresencio G.
Castaneda, docketed as Civil Case No. 14510 before Branch 44 of
Regional Trial Court in Bacolod City. In due time, said defendants
submitted their Answer with counterclaim.
On May 31, 1986, the trial court came out with its Decision in
favor of plaintiff Aquarius Fishing Co., Inc. ratiocinating and disposing
thus:
The question to be determined is whether the collision between M/V
Don Sulpicio and F/B Aquarius 'G' was due to the negligence of the
defendants or of the plaintiff. It is admitted in the evidence that at a
distance of about 4 miles M/V Don Sulpicio has sighted 2 fishing
boats, namely: F/B Aquarius 'C' and F/B Aquarius G although
defendants maintained it was F/B Aquarius 'B'. From the evidence it
appears that the 2 fishing boats had a speed of about 7.5 to 8 knots
per hour while M/V Don Sulpicio was running about 15.5 knots per
hour. It would appear that the speed of M/V Don Sulpicio was more
than twice as fast as the speed of the two fishing boats. The weather
at that time the accident happened was clear and visibility was
good. In other words, from the distance of about four miles at sea,
the men of Don Sulpicio could clearly see the 2 fishing boats which
were ahead about 4 miles and likewise, the men of the 2 fishing
boats could clearly see M/V Don Sulpicio following. The plaintiff
claims that they continued on their speed in their course and while
maintaining their speed they were rammed by M/V Don Sulpicio.
Defendants claim that plaintiff was negligent and that the collision
was due to the negligence of the men manning F/B Aquarius 'B' and
submit that considering that F/B Aquarius 'B' had no lookout and that
the fishing boat was ahead, F/B Aquarius 'B' should have given way
to M/V Don Sulpicio who was following in order to avoid collision. And
considering that F/B Aquarius 'B' was at fault, it should suffer its own
damage.
xxx xxx xxx
It appears in the theory of defendants that simply because a vessel
had no lookout and that the vessel was ahead, if it is rammed by
another vessel that is following, the fault would be on the vessel that
is ahead because the vessel that is ahead should always give way to
the vessel that is following.
xxx xxx xxx
From this argument, it would appear that whether actual negligence
was committed by the vessel ahead or not, but as long as the vessel
had no lookout and has not given way to the vessel following, the
vessel following, if it ram the vessel ahead, has no fault.
It should be noted that F/B Aquarius G is a fishing vessel with a
speed of only 7.5 or 8 knots per hour and according to the master of
the vessel, they are not required by law to have a lookout because
the vessel is small. M/V Don Sulpicio is a passenger boat with a
speed of about 15.5 knots an hour and being a passenger boat, it is
bigger boat and a faster boat. It is incumbent upon its master to see
to it that the direction to which they are proceeding is clear. Having
seen for the first time the 2 vessels, F/B Aquarius C and F/B
Aquarius G about 4 miles ahead and that they were almost parallel to
each other or in the same line with each other, as M/V Don Sulpicio
was following, M/V Don Sulpicio should have used sufficient diligence
to avoid collision. It appears from the evidence that during the
incident, the weather was clear and visibility was very good. The M/V
Don Sulpicio had a clear opportunity to avoid collision, but it failed to
do so. M/V Don Sulpicio believed, that considering that it was a
following vessel, it can just go thru and proceed irrespective of
danger. The Court believes that the evidence is abundant to show
negligence on the part of the master of the defendants and as such,
defendants should be held responsible for all the damages suffered
by F/B Aquarius G.
Defendants claim that the vessel involved was F/B Aquarius
B. However, the evidence show that the fishing vessel that sunk was
F/B Aquarius G and not F/B Aquarius B. And as shown by the
evidence, the total loss of F/B Aquarius G together with its articles
and provisions was P564,448.80.[2]
WHEREFORE, the Court finds the complaint duly supported by
evidence and judgment is hereby rendered in favor of the plaintiff and
against the defendants, who are hereby ordered to pay, jointly and
severally, the plaintiff the sum of P564,448.80 for the actual loss of
F/B Aquarius G including its articles and provisions; the sum
of P10,000.00 per month from the date of the accident representing
deprivation of the use and services of F/B Aquarius G and another
sum of P10,000.00 for actual expenses and costs of litigation,
another sum of P10,000.00 by way of exemplary damages, another
sum equivalent to 15% of the total claim of plaintiff as attorneys fees
plus P300.00 per court appearance, and to pay legal rate of interest
of all the amounts so adjudged from November 18, 1978 until the
entire amount is fully paid, and to pay the costs. Counterclaim is
dismissed.[3]
The defendants appealed to the Court of Appeals, assigning
seven (7) errors which the appellate court summed up and treated as
two pivotal issues, to wit:
1. THE COURT A QUO ERRED IN DISREGARDING THE
REGULATION FOR PREVENTING COLLISION AT SEA, MORE
POPULARLY KNOWN AS THE RULE OF THE ROAD IN
DETERMINING WHICH OF THE TWO VESSELS WAS NEGLIGENT
AND LIABLE, CONSIDERING THAT M/V DON SULPICIO
COMPLIED WITH THEIR PROVISIONS, WHILE F/B AQUARIUS G
DID NOT; AND
2. THE COURT A QUO ERRED IN AWARDING DAMAGES,
ATTORNEYS FEES, ACTUAL EXPENSES AND COSTS OF
LITIGATION, LEGAL RATE OF INTEREST OF ALL THE AWARDS
FROM NOVEMBER 18, 1978 UNTIL ALL THE AMOUNTS ARE
FULLY PAID.[4]
On November 29, 1989, the Court of Appeals affirmed the
Decision of the trial court of origin. The Motion for Reconsideration
interposed on December 23, 1989 by appellants met the same fate. It
was denied on April 24, 1990.
Undaunted, petitioners found their way to this Court via the
present Petition for Review on Certiorari, contending that:
I
THE LOWER COURT ERRED IN EXONERATING THE VESSEL F/B
AQUARIUS B AND HER MASTER FROM NEGLIGENCE DESPITE
THE ADMISSION BY AGAPITO GERBOLINGA, PATRON OF SAID
VESSEL THAT THEY HAD NO LOOKOUT DURING THE
COLLISION.
II
THE LOWER COURT ERRED IN DISREGARDING THE
REGULATION FOR PREVENTING COLLISION AT SEA, MORE
POPULARLY KNOWN AS THE RULES OF THE ROAD IN
DETERMINING WHICH OF THE TWO VESSELS WAS NEGLIGENT
AND LIABLE.
III
THE LOWER COURT ERRED IN IMPUTING NEGLIGENCE ON
THE VESSEL M/V DON SULPICIO, THE PRIVILEGED VESSEL
WHICH COMPLIED WITH RULES 19 AND 21, RULES OF THE
ROAD.
IV
THE LOWER COURT ERRED IN AWARDING TO PLAINTIFF-
APPELLEE THE AMOUNT OF P564,448.80 AS ACTUAL LOSS
PLUS P10,000.00 PER MONTH FROM THE PERIOD OF
NOVEMBER 18, 1978 REPRESENTING DEPRIVATION OF USE
AND SERVICES OF F/B AQUARIUS B AND ANOTHER SUM OF
P10,000.00 FOR ACTUAL EXPENSES AND COST OF LITIGATION.
V
THE LOWER COURT ERRED IN AWARDING PLAINTIFF AND
AGAINST DEFENDANTS THE SUM OF P10,000.00 AS
EXEMPLARY DAMAGES.
VI
THE LOWER COURT ERRED IN AWARDING PLAINTIFF AND
AGAINST THE DEFENDANT-APPELLEE THE SUM EQUIVALENT
TO 15% OF THE TOTAL CLAIM AS ATTORNEYS FEES PLUS
P300.00 PER COURT APPEARANCE.
VII
THE LOWER COURT ERRED IN AWARDING LEGAL RATE OF
INTEREST OF ALL THE AWARDS TO PLAINTIFF-APPELLEE
FROM NOVEMBER 18, 1978 UNTIL ALL THE AMOUNTS ARE
FULLY PAID.[5]
Placing reliance on the Rules of the Road and Regulations on
the Prevention of Collision, petitioners maintain:
xxx that respondent Court of Appeals completely disregarded the rule
of admission in matters adverse to ones interest. It is very clear that
the F/B Aquarius B, her patron and crew were negligent in this
case. The Rules of the Road which is Annex A' of the Philippine
Merchant Rules and Regulations requires that all vessels must have
a lookout (Rule 29, Rules of the Road). All vessels irrespective of
size and make must keep a lookout. There is no exception to this
rule.
xxx xxx xxx
It was clearly established by the positive testimony of second mate,
Aurelio Villacampa, Jr. on July 14, 1981 and the sketch prepared by
said witness (Exhibit 2) that the two vessels were in a crossing
situation. The vessel M/V Don Sulpicio was approaching on the
starboard or right side of the crossing vessel F/B Aquarius B. The
applicable rules in such a crossing situation are Rules 19, 21, 22 and
23. We quote the above Rules as follows:
Rule 19. When two power driven vessels are crossing, so as to
involve risk of collision, the vessel which has the other on her
starboard side shall keep out of the way of the other.
Rule 21. Where, by any of the Rules, one of two vessels is to keep
out of the way, the other shall keep her course and speed.
Rule 22. Every vessel which is directed by these Rules to keep out of
the way of another vessel, so far as possible, take positive early
action to comply with this obligation, and shall, if the circumstance of
the case admit, avoid crossing ahead of the other.
Rule 23. Every power-driven vessel which is directed by these Rules
to keep out of the way of another vessel shall, on approaching her, if
necessary, slacken her speed or stop or reverse.
The M/V DON SULPICIO was the privileged vessel and the F/B
Aquarius B was the burdened vessel in the crossing situation
(Exhibits 2, 3, 4, 9, 10). However, the F/B Aquarius B violated the
rules, did not keep out of the way, did not slacken speed but instead
went full ahead and crossed the bow of M/V DON SULPICIO. xxx
xxx xxx xxx
In the case at bar F/B Aquarius B by failure to keep out of the way
and slacken her speed has allowed herself to come to close proximity
to the vessel M/V DON SULPICIO bringing about the collision.
The award to private respondent of the sum of P564,448.80 as actual
loss is based on surmises and conjectures. No appraisal of the value
of the vessel F/B Aquarius B was presented to support said claim of
total loss. The claim of P564,448.80 was derived after summarizing
up invoices and receipts of alleged purchases of materials, provisions
dating back since 1972 and even after November 18, 1978 the date
of the collision (Exhibits CC to KK). This award is exaggerated (sic)
and speculative.[6]
On October 24, 1990, respondent Aquarius Fishing Co., Inc.
sent in its Comment, stating:
Granting for the sake of argument that any or all of the petitioners
witnesses can be classified as lookouts for M/V Don Sulpicio, their
negligence is made much clearer because they could not determine
risk of collision, speed was not slackened, no warning sign was made
and the course of M/V Don Sulpicio was not changed to avoid the
collision.
At any rate, the office of the Coast Guard Judge Advocate which we
believed is the proper authority and has the technical competence to
determine who is at fault in maritime cases has this to say on the look
out defense put up by the petitioners:
It is clear that the M/V Don Sulpicio was the overtaking vessel and,
under the Rules on the Road, was the burdened vessel which had
the duty to take all the necessary actions to keep clear of the
overtaken vessel. It was also shown that M/V Don Sulpicio did not
alter her course to reduce her speed and being at close range with
F/B Aquarius G, did not even give a warning signal. It was likewise
shown that the Aquarius Fishing Co., Inc. did not own a vessel
named F/B Aquarius B ( as identified by Chief Mate Oro), but it did
own a vessel named Aquarius G at the time of the incident. The fact
that F/B 'Aquarius G' had no lookout at the time of the collision does
not excuse M/V Don Sulpicio from observing her duty to keep clear of
the overtaken vessel especially so when there was sufficient room for
her to do so.[7]
The Petition is not impressed with merit.
Well-settled to the point of being elementary is the doctrine that
the findings by the trial court are binding on the appellate court and
will not be disturbed on appeal, unless the trial court has overlooked
or ignored some fact or circumstance of sufficient weight or
significance which, if considered, would alter the situation.[8]
"Factual findings of the appellate court deemed conclusive. (Estonina
v. Court of Appeals, 266 SCRA 627)"
It is a fundamental rule in criminal as well as in civil cases that in the
matter of credibility of witnesses, the findings of the trial court are
given great weight and highest degree of respect by the appellate
court. (Lee Eng Hong v. Court of Appeals, 241 SCRA 392 citing
Pagsuyuin v. Intermediate Appellate Court, 193 SCRA 547)
xxx It is not the function of this Court to assess and evaluate all over
again the evidence, testimonial and evidentiary, adduced by the
parties particularly where, such as here, the findings of both the trial
court and the appellate court on the matter coincide. (South Sea
Surety and Insurance Company, Inc. v. Court of Appeals, 244 SCRA
744)
It is a settled principle of civil procedure that the conclusions of the
trial court regarding the credibility of witnesses are entitled to great
respect from the appellate court xxx" (Limketkai Sons Milling, Inc. vs.
Court of Appeals, 250 SCRA 253, citing Serrano vs. Court of
Appeals, 196 SCRA 107)
After a thorough review and examination of the evidence on
hand, we discern no ground or basis for disregarding the findings and
conclusion arrived at below.
Petitioners asserted that private respondent, through its patron,
admitted that the vessel had no lookout during the collision despite
the absolute rule provided in Rule 9 of the Rules of Road. To bolster
its stance, it contended that it was a privileged vessel pursuant to
Rules 19, 21, 22, 23 of the Regulations for the Prevention of
Collisions at Sea.
Both the trial court and the respondent court found that M/V
Don Sulpicio was crossing at 15.5 knots per hour while F/B Aquarius
G was obeying a speed limit of 7.5 knots per hour. The weather was
clear and visibility was good. M/V Don Sulpicio was four (4) miles
away when it first sighted F/B Aquarius G. All the time up to the
collision, M/V Don Sulpicio maintained its speed of 16 knots. It was
only two (2) minutes before the collision when M/V Don Sulpicio
changed its course.
Whether or not the collision sued upon occurred in a crossing
situation is immaterial as the Court of Appeals, relying on Rule 24-C,
Regulations for Preventing Collisions at the Sea, rules that the duty
to keep out of the way remained even if the overtaking vessel cannot
determine with certainty whether she is forward of or abaft more than
2 points from the vessel. It is beyond cavil that M/V Don
Sulpicio must assume responsibility as it was in a better position to
avoid the collision. It should have blown its horn or give signs to warn
the other vessel that it was to overtake it.
Assuming argumenti ex gratia that F/B Aquarius G had no
lookout during the collision, the omission does not suffice to
exculpate Sulpicio Lines from Liability. M/V Don Sulpicio cannot claim
that it was a privileged vessel being in the portside which can
maintain its course and speed during the collision. When it
overtook F/B Aquarius G, it was duty bound during the
collision. When it overtook F/B Aquarius G, it was duty bound to
slacken its speed and keep away from other vessel, which it failed to
do. The stance of petitioners that F/B Aquarius G is a burdened
vessel which should have kept out of the way of M/V Don Sulpicio is
not supported by facts.
Anent the award of actual damage in the amount
of P564,448.80, petitioners mere allegation that the award of actual
damages is exaggerated and speculative, without controverting the
receipts and invoices when the boat was constructed and which were
bases of accounting entries in the books of accounts presented by
the private respondent, are unavailing to defeat the award. To be
sure, the private respondent amply established the compensatory
damages it suffered by reason of the collision.
The award of fifteen (15%) percent of the total claim sued upon
as attorneys fees and the legal rate of interest adjudged are
proper. However, the P10,000.00 a month awarded by the trial court
and the respondent court for earnings that would have derived
from F/B Aquarius G, without indicating the material period is too
uncertain and onerous to deserve serious consideration.
In awarding P10,000.00 per month, representing the supposed
profits F/B Aquarius G could have netted, the trial court relied on the
sole testimony of Mr. Johnny L. Chua, who is in the employ of private
respondent.
amounted to an admission of such allegation. The vessel was
constructed in 1972 while the collision occurred in 1978. The
remaining life span of F/B Aquarius G was therefore four (4)
years. Conformably, computed at P10,000.00 per month for a period
of four (4) years, the unrealized profits/earnings involved, amounted
to at most P480,000.00.
As regards the attorneys fees equivalent to 15% of all the
awards granted by the Regional Trial Court, the propriety thereof
cannot be questioned. Gross and evident bad faith on the part of
petitioner in refusing to pay the claim sued upon constrained the
private respondent to enlist the services of a lawyer to litigate.
Petitioner must have placed reliance on the general rule that
attorneys fees cannot be recovered as part of damages because of
the policy that no premium should be placed on the right to
litigate. (Philtranco Service Enterprises, Inc. v. Court of Appeals, 273
SCRA 562; Morales v. Court of Appeals, 274 SCRA 282). But the
aforecited rule is inapplicable here in the face of the stubborn refusal
of petitioner to respect the valid claim of the private respondent.
The payment of legal interest is also in order. But it should be
computed from November 18, 1978, not from March 30, 1986, when
the Regional Trial Court a quo came out with its Decision. It was from
the time of the collision complained of that the private respondent
began to be deprived of subject vessel.
WHEREFORE, the Petition is DENIED and the Decision of the
Court of Appeals in CA GR CV No. 15081 AFFIRMED, with the
MODIFICATION that the award for exemplary damages is deleted for
want of legal basis, and the amount of unrealized profits awarded is
fixed at P480,000.00. No pronouncement as to cost.
SO ORDERED.
Romero, (Chairman), Vitug, Panganiban, and Gonzaga-Reyes,
JJ., concur.

The arguments of petitioners that the earnings of F/B Aquarius G

must be shown is not applicable in this case. F/B Aquarius G is just a
carrier to its mother boat Aquarius G. Its role was to carry the catch
from the fishing ground to the port and it was serving not only its
mother boat, but other boats owned by respondent Aquarius. The
income of F/B Aquarius G is therefore impossible to really
determine. The only reasonable basis is only its rental value
compared with similar boats.[9]

As regards the reckoning period, there is tenability in

petitioners submission that a fishing boat deteriorates quite quickly
due to exposure to the elements. To hold Sulpicio Lines to pay the
profits that would have been realized by the private respondents for
an unlimited period of time is to burden it indefinitely, which cannot
be countenanced.

xxx The decision awarding P10,000.00 per month reckoned from

November 1978 up to the present implies unlimited existence of the
fishing vessel F/B Aquarius G which is not the case as any common
man will experience. The Honorable Court can take judicial notice of
the deterioration of the wood in a fishing boat that is always exposed
to the elements. Surely, said existence will not last for more than ten
years. Considering that the fishing vessel is already six years old,
then it has a lifespan of not more than four more years.[10]

Failure of Aquarius Fishing Co., Inc. to come forward with

controverting evidence to the allegation of Sulpicio Lines that the
ordinary lifespan of a fishing vessel is more than ten (10) years,
G.R. No. 84458 November 6, 1989
ABOITIZ SHIPPING CORPORATION, petitioner,
vs.
HON. COURT OF APPEALS, ELEVENTH DIVISION, LUCILA C.
VIANA, SPS. ANTONIO VIANA and GORGONIA VIANA, and
PIONEER STEVEDORING CORPORATION, respondents.
Herenio E. Martinez for petitioner.
M.R. Villaluz Law Office for private respondent.
REGALADO, J.:
In this appeal by certiorari, petitioner Aboitiz Shipping Corporation
seeks a review of the decision 1 of respondent Court of Appeals,
dated July 29, 1988, the decretal portion of which reads:
WHEREFORE, the judgment appealed from as
modified by the order of October 27, 1982, is
hereby affirmed with the modification that
appellant Aboitiz Shipping is hereby ordered to
pay plaintiff-appellees the amount of P30,000.00
for the death of Anacleto Viana; actual damages
of P9,800.00; P150,000.00 for unearned income;
P7,200.00 as support for deceased's parents;
P20,000.00 as moral damages; P10,000.00 as
attorney's fees; and to pay the costs.
The undisputed facts of the case, as found by the court a quo and
adopted by respondent court, are as follows: .
The evidence disclosed that on May 11, 1975,
Anacleto Viana boarded the vessel M/V Antonia,
owned by defendant, at the port at San Jose,
Occidental Mindoro, bound for Manila, having
purchased a ticket (No. 117392) in the sum of
P23.10 (Exh. 'B'). On May 12, 1975, said vessel
arrived at Pier 4, North Harbor, Manila, and the
passengers therein disembarked, a gangplank
having been provided connecting the side of the
vessel to the pier. Instead of using said
gangplank Anacleto Viana disembarked on the
third deck which was on the level with the pier.
After said vessel had landed, the Pioneer
Stevedoring Corporation took over the exclusive
control of the cargoes loaded on said vessel
pursuant to the Memorandum of Agreement
dated July 26, 1975 (Exh. '2') between the third
party defendant Pioneer Stevedoring Corporation
and defendant Aboitiz Shipping Corporation.
The crane owned by the third party defendant
and operated by its crane operator Alejo
Figueroa was placed alongside the vessel and
one (1) hour after the passengers of said vessel
had disembarked, it started operation by
unloading the cargoes from said vessel. While
the crane was being operated, Anacleto Viana
who had already disembarked from said vessel
obviously remembering that some of his cargoes
were still loaded in the vessel, went back to the
vessel, and it was while he was pointing to the
crew of the said vessel to the place where his
cargoes were loaded that the crane hit him,
pinning him between the side of the vessel and
the crane. He was thereafter brought to the
hospital where he later expired three (3) days
thereafter, on May 15, 1975, the cause of his
death according to the Death Certificate (Exh.
"C") being "hypostatic pneumonia secondary to
traumatic fracture of the pubic bone lacerating
the urinary bladder" (See also Exh. "B"). For his
hospitalization, medical, burial and other
miscellaneous expenses, Anacleto's wife, herein
plaintiff, spent a total of P9,800.00 (Exhibits "E",
"E-1", to "E-5"). Anacleto Viana who was only
forty (40) years old when he met said fateful
accident (Exh. 'E') was in good health. His
average annual income as a farmer or a farm
supervisor was 400 cavans of palay annually. His
parents, herein plaintiffs Antonio and Gorgonia
Viana, prior to his death had been recipient of
twenty (20) cavans of palay as support or
P120.00 monthly. Because of Anacleto's death,
plaintiffs suffered mental anguish and extreme
worry or moral damages. For the filing of the
instant case, they had to hire a lawyer for an
agreed fee of ten thousand (P10,000.00) pesos. 2
Private respondents Vianas filed a complaint 3 for damages against
petitioner corporation (Aboitiz, for brevity) for breach of contract of
carriage.
In its answer. 4 Aboitiz denied responsibility contending that at the
time of the accident, the vessel was completely under the control of
respondent Pioneer Stevedoring Corporation (Pioneer, for short) as
the exclusive stevedoring contractor of Aboitiz, which handled the
unloading of cargoes from the vessel of Aboitiz. It is also averred that
since the crane operator was not an employee of Aboitiz, the latter
cannot be held liable under the fellow-servant rule.
Thereafter, Aboitiz, as third-party plaintiff, filed a third-party
complaint 5 against Pioneer imputing liability thereto for Anacleto
Viana's death as having been allegedly caused by the negligence of
the crane operator who was an employee of Pioneer under its
exclusive control and supervision.
Pioneer, in its answer to the third-party complaint, 6 raised the
defenses that Aboitiz had no cause of action against Pioneer
considering that Aboitiz is being sued by the Vianas for breach of
contract of carriage to which Pioneer is not a party; that Pioneer had
observed the diligence of a good father of a family both in the
selection and supervision of its employees as well as in the
prevention of damage or injury to anyone including the victim
Anacleto Viana; that Anacleto Viana's gross negligence was the
direct and proximate cause of his death; and that the filing of the
third-party complaint was premature by reason of the pendency of
the criminal case for homicide through reckless imprudence filed
against the crane operator, Alejo Figueroa.
In a decision rendered on April 17, 1980 by the trial court, 7 Aboitiz
was ordered to pay the Vianas for damages incurred, and Pioneer
was ordered to reimburse Aboitiz for whatever amount the latter paid
the Vianas. The dispositive portion of said decision provides:
WHEREFORE, judgment is hereby rendered in
favor of the plantiffs:
(1) ordering defendant Aboitiz Shipping
Corporation to pay to plaintiffs the sum of
P12,000.00 for the death of Anacleto Viana
P9,800.00 as actual damages; P533,200.00
value of the 10,664 cavans of palay computed at
P50.00 per cavan; P10,000.00 as attorney's fees;
F 5,000.00, value of the 100 cavans of palay as
support for five (5) years for deceased (sic)
parents, herein plaintiffs Antonio and Gorgonia
Viana computed at P50.00 per cavan; P7,200.00
as support for deceased's parents computed at
P120.00 a month for five years pursuant to Art.
2206, Par. 2, of the Civil Code; P20,000.00 as
moral damages, and costs; and
(2) ordering the third party defendant Pioneer
Stevedoring Corporation to reimburse defendant
and third party plaintiff Aboitiz Shipping
 Corporation the said amounts that it is ordered to
pay to herein plaintiffs.
Both Aboitiz and Pioneer filed separate motions for reconsideration
wherein they similarly raised the trial court's failure to declare that
Anacleto Viana acted with gross negligence despite the
overwhelming evidence presented in support thereof. In addition,
Aboitiz alleged, in opposition to Pioneer's motion, that under the
memorandum of agreement the liability of Pioneer as contractor is
automatic for any damages or losses whatsoever occasioned by and
arising from the operation of its arrastre and stevedoring service.
In an order dated October 27, 1982, 8 the trial court absolved Pioneer
from liability for failure of the Vianas and Aboitiz to preponderantly
establish a case of negligence against the crane operator which the
court a quo ruled is never presumed, aside from the fact that the
memorandum of agreement supposedly refers only to Pioneer's
liability in case of loss or damage to goods handled by it but not in
the case of personal injuries, and, finally that Aboitiz cannot properly
invoke the fellow-servant rule simply because its liability stems from a
breach of contract of carriage. The dispositive portion of said order
reads:
WHEREFORE, judgment is hereby modified
insofar as third party defendant Pioneer
Stevedoring Corporation is concerned rendered
in favor of the plaintiffs-,:
(1) Ordering defendant Aboitiz Shipping
Corporation to pay the plaintiffs the sum of
P12,000.00 for the death of Anacleto Viana;
P9,000.00 (sic) as actual damages; P533,200.00
value of the 10,664 cavans of palay computed at
P50.00 per cavan; P10,000.00 as attorney's fees;
P5,000.00 value of the 100 cavans of palay as
support for five (5) years for deceased's parents,
herein plaintiffs Antonio and Gorgonia
Viana,computed at P50.00 per cavan; P7,200.00
as support for deceased's parents computed at
P120.00 a month for five years pursuant to Art.
2206, Par. 2, of the Civil Code; P20,000.00 as
moral damages, and costs; and
(2) Absolving third-party defendant Pioneer
Stevedoring Corporation for (sic) any liability for
the death of Anacleto Viana the passenger of
M/V Antonia owned by defendant third party
plaintiff Aboitiz Shipping Corporation it appearing
that the negligence of its crane operator has not
been established therein.
Not satisfied with the modified judgment of the trial court, Aboitiz
appealed the same to respondent Court of Appeals which affirmed
the findings of of the trial court except as to the amount of damages
awarded to the Vianas.
Hence, this petition wherein petitioner Aboitiz postulates that
respondent court erred:
(A) In holding that the doctrine laid down by this
honorable Court in La Mallorca vs. Court of
Appeals, et al. (17 SCRA 739, July 27, 1966) is
applicable to the case in the face of the
undisputable fact that the factual situation under
the La Mallorca case is radically different from
the facts obtaining in this case;
(B) In holding petitioner liable for damages in the
face of the finding of the court a quo and
confirmed by the Honorable respondent court of
Appeals that the deceased, Anacleto Viana was
guilty of contributory negligence, which, We
respectfully submit contributory negligence was
the proximate cause of his death; specifically the
honorable respondent Court of Appeals failed to
apply Art. 1762 of the New Civil Code;
(C) In the alternative assuming the holding of the
Honorable respondent Court of Appears that
petitioner may be legally condemned to pay
damages to the private respondents we
respectfully submit that it committed a reversible
error when it dismissed petitioner's third party
complaint against private respondent Pioneer
Stevedoring Corporation instead of compelling
the latter to reimburse the petitioner for whatever
damages it may be compelled to pay to the
private respondents Vianas. 9
At threshold, it is to be observed that both the trial court and
respondent Court of Appeals found the victim Anacleto Viana guilty of
contributory negligence, but holding that it was the negligence of
Aboitiz in prematurely turning over the vessel to the arrastre operator
for the unloading of cargoes which was the direct, immediate and
proximate cause of the victim's death.
I. Petitioner contends that since one (1) hour had already elapsed
from the time Anacleto Viana disembarked from the vessel and that
he was given more than ample opportunity to unload his cargoes
prior to the operation of the crane, his presence on the vessel was no
longer reasonable e and he consequently ceased to be a passenger.
Corollarily, it insists that the doctrine in La Mallorca vs. Court of
Appeals, et al. 10 is not applicable to the case at bar.
The rule is that the relation of carrier and passenger continues until
the passenger has been landed at the port of destination and has left
the vessel owner's dock or premises. 11 Once created, the
relationship will not ordinarily terminate until the passenger has, after
reaching his destination, safely alighted from the carrier's
conveyance or had a reasonable opportunity to leave the carrier's
premises. All persons who remain on the premises a reasonable time
after leaving the conveyance are to be deemed passengers, and
what is a reasonable time or a reasonable delay within this rule is to
be determined from all the circumstances, and includes a reasonable
time to see after his baggage and prepare for his departure.12 The
carrier-passenger relationship is not terminated merely by the fact
that the person transported has been carried to his destination if, for
example, such person remains in the carrier's premises to claim his
baggage.13
It was in accordance with this rationale that the doctrine in the
aforesaid case of La Mallorca was enunciated, to wit:
It has been recognized as a rule that the relation
of carrier and passenger does not cease at the
moment the passenger alights from the carrier's
vehicle at a place selected by the carrier at the
point of destination, but continues until the
passenger has had a reasonable time or a
reasonable opportunity to leave the carrier's
premises. And, what is a reasonable time or a
reasonable delay within this rule is to be
determined from all the circumstances. Thus, a
person who, after alighting from a train, walks
along the station platform is considered still a
passenger. So also, where a passenger has
alighted at his destination and is proceeding by
the usual way to leave the company's premises,
but before actually doing so is halted by the
report that his brother, a fellow passenger, has
been shot, and he in good faith and without intent
of engaging in the difficulty, returns to relieve his
brother, he is deemed reasonably and
necessarily delayed and thus continues to be a
passenger entitled as such to the protection of
the railroad company and its agents.
In the present case, the father returned to the bus
to get one of his baggages which was not
 unloaded when they alighted from the bus.
Racquel, the child that she was, must have
followed the father. However, although the father
was still on the running board of the bus waiting
for the conductor to hand him the bag or bayong,
the bus started to run, so that even he (the
father) had to jump down from the moving
vehicle. It was at this instance that the child, who
must be near the bus, was run over and killed. In
the circumstances, it cannot be claimed that the
carrier's agent had exercised the 'utmost
diligence' of a 'very cautious person' required by
Article 1755 of the Civil Code to be observed by a
common carrier in the discharge of its obligation
to transport safely its passengers. ... The
presence of said passengers near the bus was
not unreasonable and they are, therefore, to be
considered still as passengers of the carrier,
entitled to the protection under their contract of
carriage. 14
It is apparent from the foregoing that what prompted the Court to rule
as it did in said case is the fact of the passenger's reasonable
presence within the carrier's premises. That reasonableness of time
should be made to depend on the attending circumstances of the
case, such as the kind of common carrier, the nature of its business,
the customs of the place, and so forth, and therefore precludes a
consideration of the time element per se without taking into account
such other factors. It is thus of no moment whether in the cited case
of La Mallorca there was no appreciable interregnum for the
passenger therein to leave the carrier's premises whereas in the case
at bar, an interval of one (1) hour had elapsed before the victim met
the accident. The primary factor to be considered is the existence of
a reasonable cause as will justify the presence of the victim on or
near the petitioner's vessel. We believe there exists such a justifiable
cause.
It is of common knowledge that, by the very nature of petitioner's
business as a shipper, the passengers of vessels are allotted a
longer period of time to disembark from the ship than other common
carriers such as a passenger bus. With respect to the bulk of cargoes
and the number of passengers it can load, such vessels are capable
of accommodating a bigger volume of both as compared to the
capacity of a regular commuter bus. Consequently, a ship passenger
will need at least an hour as is the usual practice, to disembark from
the vessel and claim his baggage whereas a bus passenger can
easily get off the bus and retrieve his luggage in a very short period
of time. Verily, petitioner cannot categorically claim, through the bare
expedient of comparing the period of time entailed in getting the
passenger's cargoes, that the ruling in La Mallorca is inapplicable to
the case at bar. On the contrary, if we are to apply the doctrine
enunciated therein to the instant petition, we cannot in reason doubt
that the victim Anacleto Viana was still a passenger at the time of the
incident. When the accident occurred, the victim was in the act of
unloading his cargoes, which he had every right to do, from
petitioner's vessel. As earlier stated, a carrier is duty bound not only
to bring its passengers safely to their destination but also to afford
them a reasonable time to claim their baggage.
It is not definitely shown that one (1) hour prior to the incident, the
victim had already disembarked from the vessel. Petitioner failed to
prove this. What is clear to us is that at the time the victim was taking
his cargoes, the vessel had already docked an hour earlier. In
consonance with common shipping procedure as to the minimum
time of one (1) hour allowed for the passengers to disembark, it may
be presumed that the victim had just gotten off the vessel when he
went to retrieve his baggage. Yet, even if he had already
disembarked an hour earlier, his presence in petitioner's premises
was not without cause. The victim had to claim his baggage which
was possible only one (1) hour after the vessel arrived since it was
admittedly standard procedure in the case of petitioner's vessels that
the unloading operations shall start only after that time.
Consequently, under the foregoing circumstances, the victim
Anacleto Viana is still deemed a passenger of said carrier at the time
of his tragic death.
II. Under the law, common carriers are, from the nature of their
business and for reasons of public policy, bound to observe
extraordinary diligence in the vigilance over the goods and for the
safety of the passengers transported by them, according to all the
circumstances of each case. 15 More particularly, a common carrier is
bound to carry the passengers safely as far as human care and
foresight can provide, using the utmost diligence of very cautious
persons, with a due regard for all the circumstances. 16 Thus, where
a passenger dies or is injured, the common carrier is presumed to
have been at fault or to have acted negligently. 17 This gives rise to
an action for breach of contract of carriage where all that is required
of plaintiff is to prove the existence of the contract of carriage and its
non-performance by the carrier, that is, the failure of the carrier to
carry the passenger safely to his destination, 18which, in the instant
case, necessarily includes its failure to safeguard its passenger with
extraordinary diligence while such relation subsists.
The presumption is, therefore, established by law that in case of a
passenger's death or injury the operator of the vessel was at fault or
negligent, having failed to exercise extraordinary diligence, and it is
incumbent upon it to rebut the same. This is in consonance with the
avowed policy of the State to afford full protection to the passengers
of common carriers which can be carried out only by imposing a
stringent statutory obligation upon the latter. Concomitantly, this
Court has likewise adopted a rigid posture in the application of the
law by exacting the highest degree of care and diligence from
common carriers, bearing utmost in mind the welfare of the
passengers who often become hapless victims of indifferent and
profit-oriented carriers. We cannot in reason deny that petitioner
failed to rebut the presumption against it. Under the facts obtaining in
the present case, it cannot be gainsaid that petitioner had
inadequately complied with the required degree of diligence to
prevent the accident from happening.
As found by the Court of Appeals, the evidence does not show that
there was a cordon of drums around the perimeter of the crane, as
claimed by petitioner. It also adverted to the fact that the alleged
presence of visible warning signs in the vicinity was disputable and
not indubitably established. Thus, we are not inclined to accept
petitioner's explanation that the victim and other passengers were
sufficiently warned that merely venturing into the area in question
was fraught with serious peril. Definitely, even assuming the
existence of the supposed cordon of drums loosely placed around
the unloading area and the guard's admonitions against entry therein,
these were at most insufficient precautions which pale into
insignificance if considered vis-a-vis the gravity of the danger to
which the deceased was exposed. There is no showing that
petitioner was extraordinarily diligent in requiring or seeing to it that
said precautionary measures were strictly and actually enforced to
subserve their purpose of preventing entry into the forbidden area. By
no stretch of liberal evaluation can such perfunctory acts approximate
the "utmost diligence of very cautious persons" to be exercised "as
far as human care and foresight can provide" which is required by
law of common carriers with respect to their passengers.
While the victim was admittedly contributorily negligent, still
petitioner's aforesaid failure to exercise extraordinary diligence was
the proximate and direct cause of, because it could definitely have
prevented, the former's death. Moreover, in paragraph 5.6 of its
petition, at bar, 19 petitioner has expressly conceded the factual
finding of respondent Court of Appeals that petitioner did not present
sufficient evidence in support of its submission that the deceased
Anacleto Viana was guilty of gross negligence. Petitioner cannot now
be heard to claim otherwise.
No excepting circumstance being present, we are likewise bound by
respondent court's declaration that there was no negligence on the
part of Pioneer Stevedoring Corporation, a confirmation of the trial
court's finding to that effect, hence our conformity to Pioneer's being
absolved of any liability.
As correctly observed by both courts, Aboitiz joined Pioneer in
proving the alleged gross negligence of the victim, hence its present
contention that the death of the passenger was due to the negligence
of the crane operator cannot be sustained both on grounds, of
estoppel and for lack of evidence on its present theory. Even in its
answer filed in the court below it readily alleged that Pioneer had
taken the necessary safeguards insofar as its unloading operations
were concerned, a fact which appears to have been accepted by the
plaintiff therein by not impleading Pioneer as a defendant, and
likewise inceptively by Aboitiz by filing its third-party complaint only
after ten (10) months from the institution of the suit against it.
Parenthetically, Pioneer is not within the ambit of the rule on
extraordinary diligence required of, and the corresponding
presumption of negligence foisted on, common carriers like Aboitiz.
This, of course, does not detract from what we have said that no
negligence can be imputed to Pioneer but, that on the contrary, the
failure of Aboitiz to exercise extraordinary diligence for the safety of
its passenger is the rationale for our finding on its liability.

WHEREFORE, the petition is DENIED and the judgment appealed

from is hereby AFFIRMED in toto.

SO ORDERED.

Melencio-Herrera (Chairperson), Paras, Padilla and Sarmiento, JJ.,

concur.
G.R. No. 115278 May 23, 1995
FORTUNE INSURANCE AND SURETY CO., INC., petitioner,
vs.
COURT OF APPEALS and PRODUCERS BANK OF THE
PHILIPPINES, respondents.
DAVIDE, JR., J.:
The fundamental legal issue raised in this petition for review
on certiorari is whether the petitioner is liable under the Money,
Security, and Payroll Robbery policy it issued to the private
respondent or whether recovery thereunder is precluded under the
general exceptions clause thereof. Both the trial court and the Court
of Appeals held that there should be recovery. The petitioner
contends otherwise.
This case began with the filing with the Regional Trial Court (RTC) of
Makati, Metro Manila, by private respondent Producers Bank of the
Philippines (hereinafter Producers) against petitioner Fortune
Insurance and Surety Co., Inc. (hereinafter Fortune) of a complaint
for recovery of the sum of P725,000.00 under the policy issued by
Fortune. The sum was allegedly lost during a robbery of Producer's
armored vehicle while it was in transit to transfer the money from its
Pasay City Branch to its head office in Makati. The case was
docketed as Civil Case No. 1817 and assigned to Branch 146
thereof.
After joinder of issues, the parties asked the trial court to render
judgment based on the following stipulation of facts:
1. The plaintiff was insured
by the defendants and an
insurance policy was issued,
the duplicate original of which
is hereto attached as Exhibit
"A";
2. An armored car of the
plaintiff, while in the process
of transferring cash in the
sum of P725,000.00 under
the custody of its teller,
Maribeth Alampay, from its
Pasay Branch to its Head
Office at 8737 Paseo de
Roxas, Makati, Metro Manila
on June 29, 1987, was
robbed of the said cash. The
robbery took place while the
armored car was traveling
along Taft Avenue in Pasay
City;
3. The said armored car was
driven by Benjamin Magalong
Y de Vera, escorted by
Security Guard Saturnino
Atiga Y Rosete. Driver
Magalong was assigned by
PRC Management Systems
with the plaintiff by virtue of
an Agreement executed on
August 7, 1983, a duplicate
original copy of which is
hereto attached as Exhibit
"B";
4. The Security Guard Atiga
was assigned by Unicorn
Security Services, Inc. with
the plaintiff by virtue of a
contract of Security Service
executed on October 25,
1982, a duplicate original
copy of which is hereto
attached as Exhibit "C";
5. After an investigation
conducted by the Pasay
police authorities, the driver
Magalong and guard Atiga
were charged, together with
Edelmer Bantigue Y Eulalio,
Reynaldo Aquino and John
Doe, with violation of P.D.
532 (Anti-Highway Robbery
Law) before the Fiscal of
Pasay City. A copy of the
complaint is hereto attached
as Exhibit "D";
6. The Fiscal of Pasay City
then filed an information
charging the aforesaid
persons with the said crime
before Branch 112 of the
Regional Trial Court of Pasay
City. A copy of the said
information is hereto attached
as Exhibit "E." The case is
still being tried as of this date;
7. Demands were made by
the plaintiff upon the
defendant to pay the amount
of the loss of P725,000.00,
but the latter refused to pay
as the loss is excluded from
the coverage of the insurance
policy, attached hereto as
Exhibit "A," specifically under
page 1 thereof, "General
Exceptions" Section (b),
which is marked as Exhibit
"A-1," and which reads as
follows:
GENERAL EXCEPTIONS
The company shall not be
liable under this policy in
report of
xxx xxx xxx
(b) any
loss
caused
by any
dishonest
,
fraudulen
t or
criminal
act of the
insured
or any
officer, e
mployee,
partner,
director, t
rustee or
authorize
d
represent
ative of
the
 Insured All other claims and counterclaims are
whether accordingly dismissed forthwith.
acting
alone or SO ORDERED. 2
in
conjuncti
The trial court ruled that Magalong and Atiga were not employees or
on with
representatives of Producers. It Said:
others. . .
.
The Court is satisfied that plaintiff may not be
said to have selected and engaged Magalong
8. The plaintiff opposes the
and Atiga, their services as armored car driver
contention of the defendant
and as security guard having been merely offered
and contends that Atiga and
by PRC Management and by Unicorn Security
Magalong are not its "officer,
and which latter firms assigned them to plaintiff.
employee, . . . trustee or
The wages and salaries of both Magalong and
authorized representative . . .
Atiga are presumably paid by their respective
at the time of the robbery.1
firms, which alone wields the power to dismiss
them. Magalong and Atiga are assigned to
On 26 April 1990, the trial court rendered its decision in favor of plaintiff in fulfillment of agreements to provide
Producers. The dispositive portion thereof reads as follows: driving services and property protection as such
— in a context which does not impress the Court
WHEREFORE, premises considered, the Court as translating into plaintiff's power to control the
finds for plaintiff and against defendant, and conduct of any assigned driver or security guard,
beyond perhaps entitling plaintiff to request are
(a) orders replacement for such driver guard. The finding is
defendan accordingly compelled that neither Magalong nor
t to pay Atiga were plaintiff's "employees" in avoidance of
plaintiff defendant's liability under the policy, particularly
the net the general exceptions therein embodied.
amount
of Neither is the Court prepared to accept the
P540,000 proposition that driver Magalong and guard Atiga
.00 as were the "authorized representatives" of plaintiff.
liability They were merely an assigned armored car
under driver and security guard, respectively, for the
Policy June 29, 1987 money transfer from plaintiff's
No. 0207 Pasay Branch to its Makati Head Office. Quite
(as plainly — it was teller Maribeth Alampay who had
mitigated "custody" of the P725,000.00 cash being
by the transferred along a specified money route, and
P40,000. hence plaintiff's then designated "messenger"
00 adverted to in the policy. 3
special
clause Fortune appealed this decision to the Court of Appeals which
deduction docketed the case as CA-G.R. CV No. 32946. In its
and by decision 4 promulgated on 3 May 1994, it affirmed in toto the
the appealed decision.
recovere
d sum of
The Court of Appeals agreed with the conclusion of the trial court that
P145,000
Magalong and Atiga were neither employees nor authorized
.00), with
representatives of Producers and ratiocinated as follows:
interest
thereon
at the A policy or contract of insurance is to be
legal rate, construed liberally in favor of the insured and
until fully strictly against the insurance company (New Life
paid; Enterprises vs. Court of Appeals, 207 SCRA 669;
Sun Insurance Office, Ltd. vs. Court of Appeals,
211 SCRA 554). Contracts of insurance, like
(b) orders
other contracts, are to be construed according to
defendan
the sense and meaning of the terms which the
t to pay
parties themselves have used. If such terms are
plaintiff
clear and unambiguous, they must be taken and
the sum
understood in their plain, ordinary and popular
of
sense (New Life Enterprises Case, supra, p. 676;
P30,000.
Sun Insurance Office, Ltd. vs. Court of Appeals,
00 as and
195 SCRA 193).
for
attorney's
fees; and The language used by defendant-appellant in the
above quoted stipulation is plain, ordinary and
simple. No other interpretation is necessary. The
(c) orders
word "employee" must be taken to mean in the
defendan
ordinary sense.
t to pay
costs of
suit. The Labor Code is a special law specifically
dealing with/and specifically designed to protect
 labor and therefore its definition as to employer-
employee relationships insofar as the
application/enforcement of said Code is
concerned must necessarily be inapplicable to an
insurance contract which defendant-appellant
itself had formulated. Had it intended to apply the
Labor Code in defining what the word "employee"
refers to, it must/should have so stated expressly
in the insurance policy.
Said driver and security guard cannot be
considered as employees of plaintiff-appellee
bank because it has no power to hire or to
dismiss said driver and security guard under the
contracts (Exhs. 8 and C) except only to ask for
their replacements from the contractors.5
On 20 June 1994, Fortune filed this petition for review on certiorari. It
alleges that the trial court and the Court of Appeals erred in holding it
liable under the insurance policy because the loss falls within the
general exceptions clause considering that driver Magalong and
security guard Atiga were Producers' authorized representatives or
employees in the transfer of the money and payroll from its branch
office in Pasay City to its head office in Makati.
According to Fortune, when Producers commissioned a guard and a
driver to transfer its funds from one branch to another, they
effectively and necessarily became its authorized representatives in
the care and custody of the money. Assuming that they could not be
considered authorized representatives, they were, nevertheless,
employees of Producers. It asserts that the existence of an employer-
employee relationship "is determined by law and being such, it
cannot be the subject of agreement." Thus, if there was in reality an
employer-employee relationship between Producers, on the one
hand, and Magalong and Atiga, on the other, the provisions in the
contracts of Producers with PRC Management System for Magalong
and with Unicorn Security Services for Atiga which state that
Producers is not their employer and that it is absolved from any
liability as an employer, would not obliterate the relationship.
Fortune points out that an employer-employee relationship depends
upon four standards: (1) the manner of selection and engagement of
the putative employee; (2) the mode of payment of wages; (3) the
presence or absence of a power to dismiss; and (4) the presence and
absence of a power to control the putative employee's conduct. Of
the four, the right-of-control test has been held to be the decisive
factor. 6 It asserts that the power of control over Magalong and Atiga
was vested in and exercised by Producers. Fortune further insists
that PRC Management System and Unicorn Security Services are
but "labor-only" contractors under Article 106 of the Labor Code
which provides:
Art. 106. Contractor or subcontractor. — There is
"labor-only" contracting where the person
supplying workers to an employer does not have
substantial capital or investment in the form of
tools, equipment, machineries, work premises,
among others, and the workers recruited and
placed by such persons are performing activities
which are directly related to the principal
business of such employer. In such cases, the
person or intermediary shall be considered
merely as an agent of the employer who shall be
responsible to the workers in the same manner
and extent as if the latter were directly employed
by him.
Fortune thus contends that Magalong and Atiga were employees of
Producers, following the ruling in International Timber
Corp. vs. NLRC 7 that a finding that a contractor is a "labor-only"
contractor is equivalent to a finding that there is an employer-
employee relationship between the owner of the project and the
employees of the "labor-only" contractor.
On the other hand, Producers contends that Magalong and Atiga
were not its employees since it had nothing to do with their selection
and engagement, the payment of their wages, their dismissal, and
the control of their conduct. Producers argued that the rule
in International Timber Corp. is not applicable to all cases but only
when it becomes necessary to prevent any violation or circumvention
of the Labor Code, a social legislation whose provisions may set
aside contracts entered into by parties in order to give protection to
the working man.
Producers further asseverates that what should be applied is the rule
in American President Lines vs. Clave, 8 to wit:
In determining the existence of employer-
employee relationship, the following elements are
generally considered, namely: (1) the selection
and engagement of the employee; (2) the
payment of wages; (3) the power of dismissal;
and (4) the power to control the employee's
conduct.
Since under Producers' contract with PRC Management Systems it is
the latter which assigned Magalong as the driver of Producers'
armored car and was responsible for his faithful discharge of his
duties and responsibilities, and since Producers paid the monthly
compensation of P1,400.00 per driver to PRC Management Systems
and not to Magalong, it is clear that Magalong was not Producers'
employee. As to Atiga, Producers relies on the provision of its
contract with Unicorn Security Services which provides that the
guards of the latter "are in no sense employees of the CLIENT."
There is merit in this petition.
It should be noted that the insurance policy entered into by the
parties is a theft or robbery insurance policy which is a form of
casualty insurance. Section 174 of the Insurance Code provides:
Sec. 174. Casualty insurance is insurance
covering loss or liability arising from accident or
mishap, excluding certain types of loss which by
law or custom are considered as falling
exclusively within the scope of insurance such as
fire or marine. It includes, but is not limited to,
employer's liability insurance, public liability
insurance, motor vehicle liability insurance, plate
glass insurance, burglary and theft insurance,
personal accident and health insurance as written
by non-life insurance companies, and other
substantially similar kinds of insurance.
(emphases supplied)
Except with respect to compulsory motor vehicle liability insurance,
the Insurance Code contains no other provisions applicable to
casualty insurance or to robbery insurance in particular. These
contracts are, therefore, governed by the general provisions
applicable to all types of insurance. Outside of these, the rights and
obligations of the parties must be determined by the terms of their
contract, taking into consideration its purpose and always in
accordance with the general principles of insurance law. 9
It has been aptly observed that in burglary, robbery, and theft
insurance, "the opportunity to defraud the insurer — the moral hazard
— is so great that insurers have found it necessary to fill up their
policies with countless restrictions, many designed to reduce this
hazard. Seldom does the insurer assume the risk of all losses due to
the hazards insured against." 10 Persons frequently excluded under
such provisions are those in the insured's service and
employment. 11 The purpose of the exception is to guard against
liability should the theft be committed by one having unrestricted
access to the property. 12 In such cases, the terms specifying the
excluded classes are to be given their meaning as understood in
common speech. 13 The terms "service" and "employment" are
generally associated with the idea of selection, control, and
compensation. 14
A contract of insurance is a contract of adhesion, thus any ambiguity
therein should be resolved against the insurer, 15 or it should be
construed liberally in favor of the insured and strictly against the
insurer. 16 Limitations of liability should be regarded with extreme
jealousy and must be construed
in such a way, as to preclude the insurer from non-compliance with
its obligation. 17 It goes without saying then that if the terms of the
contract are clear and unambiguous, there is no room for
construction and such terms cannot be enlarged or diminished by
judicial construction. 18
An insurance contract is a contract of indemnity upon the terms and
conditions specified therein. 19 It is settled that the terms of the policy
constitute the measure of the insurer's liability. 20 In the absence of
statutory prohibition to the contrary, insurance companies have the
same rights as individuals to limit their liability and to impose
whatever conditions they deem best upon their obligations not
inconsistent with public policy.
With the foregoing principles in mind, it may now be asked whether
Magalong and Atiga qualify as employees or authorized
representatives of Producers under paragraph (b) of the general
exceptions clause of the policy which, for easy reference, is again
quoted:
GENERAL EXCEPTIONS
The company shall not be liable under this policy
in respect of
xxx xxx xxx
P.D. No. 532, and the information therefor filed by the City
Fiscal of Pasay City, there is a paucity of evidence as to
whether the contracts between Producers and PRC
Management Systems and Unicorn Security Services are
"labor-only" contracts.
But even granting for the sake of argument that these contracts were
not "labor-only" contracts, and PRC Management Systems and
Unicorn Security Services were truly independent contractors, we are
satisfied that Magalong and Atiga were, in respect of the transfer of
Producer's money from its Pasay City branch to its head office in
Makati, its "authorized representatives" who served as such with its
teller Maribeth Alampay. Howsoever viewed, Producers entrusted the
three with the specific duty to safely transfer the money to its head
office, with Alampay to be responsible for its custody in transit;
Magalong to drive the armored vehicle which would carry the money;
and Atiga to provide the needed security for the money, the vehicle,
and his two other companions. In short, for these particular tasks, the
three acted as agents of Producers. A "representative" is defined as
one who represents or stands in the place of another; one who
represents others or another in a special capacity, as an agent, and
is interchangeable with "agent." 23
In view of the foregoing, Fortune is exempt from liability under the
general exceptions clause of the insurance policy.
WHEREFORE , the instant petition is hereby GRANTED. The
decision of the Court of Appeals in CA-G.R. CV No. 32946 dated 3
May 1994 as well as that of Branch 146 of the Regional Trial Court of
Makati in Civil Case No. 1817 are REVERSED and SET ASIDE. The
complaint in Civil Case No. 1817 is DISMISSED.

No pronouncement as to costs.
(b) any loss caused by any
dishonest, fraudulent or
criminal act of the insured or SO ORDERED.
any officer, employee,
partner, director, trustee or Bellosillo and Kapunan, JJ., concur.
authorized representative of
the Insured whether acting Padilla, J., took no part.
alone or in conjunction with
others. . . . (emphases
Quiason, J., is on leave.
supplied)

There is marked disagreement between the parties on the correct

meaning of the terms "employee" and "authorized representatives."

It is clear to us that insofar as Fortune is concerned, it was its

intention to exclude and exempt from protection and coverage losses
arising from dishonest, fraudulent, or criminal acts of persons granted
or having unrestricted access to Producers' money or payroll. When it
used then the term "employee," it must have had in mind any person
who qualifies as such as generally and universally understood, or
jurisprudentially established in the light of the four standards in the
determination of the employer-employee relationship, 21 or as
statutorily declared even in a limited sense as in the case of Article
106 of the Labor Code which considers the employees under a
"labor-only" contract as employees of the party employing them and
not of the party who supplied them to the employer. 22

Fortune claims that Producers' contracts with PRC Management

Systems and Unicorn Security Services are "labor-only" contracts.

Producers, however, insists that by the express terms

thereof, it is not the employer of Magalong. Notwithstanding
such express assumption of PRC Management Systems
and Unicorn Security Services that the drivers and the
security guards each shall supply to Producers are not the
latter's employees, it may, in fact, be that it is because the
contracts are, indeed, "labor-only" contracts. Whether they
are is, in the light of the criteria provided for in Article 106 of
the Labor Code, a question of fact. Since the parties opted
to submit the case for judgment on the basis of their
stipulation of facts which are strictly limited to the insurance
policy, the contracts with PRC Management Systems and
Unicorn Security Services, the complaint for violation of
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-30309 November 25, 1983
CLEMENTE BRIÑAS, petitioner,
vs.
THE PEOPLE OF THE PHILIPPINES and HONORABLE COURT
OF APPEALS, respondents.
Mariano R. Abad for petitioner.
The Solicitor General for respondents.
GUTIERREZ, JR., J.:
This is a petition to review the decision of respondent Court of
Appeals, now Intermediate Appellate Court, affirming the decision of
the Court of First Instance of Quezon, Ninth Judicial District, Branch
1, which found the accused Clemente Briñas guilty of the crime of
DOUBLE HOMICIDE THRU RECKLESS IMPRUDENCE prior the
deaths of Martina Bool and Emelita Gesmundo.
The information charged the accused-appellant. and others as
follows:
That on or about the 6th day of January, 1957, in the Municipality of
Tiaong, Province of Quezon, Philippines, and within the jurisdiction of
this Hon. Court, the said accused Victor Milan, Clemente Briñas and
Hermogenes Buencamino, being then persons in charge of
passenger Train No. 522-6 of the Manila Railroad Company, then
running from Tagkawayan to San Pablo City, as engine driver,
conductor and assistant conductor, respectively, wilfully and
unlawfully drove and operated the same in a negligent, careless and
imprudent manner, without due regard to existing laws, regulations
and ordinances, that although there were passengers on board the
passenger coach, they failed to provide lamps or lights therein, and
failed to take the necessary precautions for the safety of passengers
and to prevent accident to persons and damage to property, causing
by such negligence, carelessness and imprudence, that when said
passenger Train No. 522-6 was passing the railroad tracks in the
Municipality of Tiaong, Quezon, two of its passengers, Martina Bool,
an old woman, and Emelita Gesmundo, a child about three years of
age, fell from the passenger coach of the said train, as a result of
which, they were over run, causing their instantaneous death. "
and the victims were not among the passengers who disembarked
thereat .têñ.£îhqwâ£
Next morning, the Tiaong police received a report
that two corpses were found along the railroad
tracks at Barrio Lagalag. Repairing to the scene
to investigate, they found the lifeless body of a
female child, about 2 feet from the railroad tracks,
sprawled to the ground with her belly down, the
hand resting on the forehead, and with the back
portion of the head crushed. The investigators
also found the corpse of an old woman about 2
feet away from the railroad tracks with the head
and both legs severed and the left hand missing.
The head was located farther west between the
rails. An arm was found midway from the body of
the child to the body of the old woman. Blood,
pieces of scattered brain and pieces of clothes
were at the scene. Later, the bodies were
Identified as those of Martina Bool and Emelita
Gesmundo. Among the personal effects found on
Martina was a train ticket (Exhibits "B").
On January 7, 1957, the bodies of the deceased were autopsied by
Dr. Pastor Huertas, the Municipal Health Officer of Tiaong. Dr.
Huertas testified on the cause of death of the victims as
follows: têñ.£îhqwâ£
FISCAL YNGENTE:
Q What could have caused
the death of those women?
A Shock.
Q What could have caused
that shock?
A Traumatic injury.
Q What could have caused
traumatic injury?
A The running over by the
wheel of the train.
Q With those injuries, has a
person a chance to survive?
A No chance to survive.

The facts established by the prosecution and accepted by the Q What would you say death
respondent court as basis for the decision are summarized as would come?
follows:
A Instantaneous.
The evidence of the prosecution tends to show that in the afternoon
of January 6, 1957, Juanito Gesmundo bought a train ticket at the
Q How about the girl, the
railroad station in Tagkawayan, Quezon for his 55-year old mother
young girl about four years
Martina Bool and his 3-year old daughter Emelita Gesmundo, who
old, what could have caused
were bound for Barrio Lusacan, Tiaong, same province. At about
the death?
2:00 p.m., Train No. 522 left Tagkawayan with the old woman and
her granddaughter among the passengers. At Hondagua the train's
complement were relieved, with Victor Millan taking over as A Shock too.
engineman, Clemente Briñas as conductor, and Hermogenes
Buencamino as assistant conductor. Upon approaching Barrio Q What could have caused
Lagalag in Tiaong at about 8:00 p.m. of that same night, the train the shock?
slowed down and the conductor shouted 'Lusacan', 'Lusacan'.
Thereupon, the old woman walked towards the left front door facing A Compound fracture of the
the direction of Tiaong, carrying the child with one hand and holding skull and going out of the
her baggage with the other. When Martina and Emelita were near the brain.
door, the train suddenly picked up speed. As a result the old woman
and the child stumbled and they were seen no more. It took three Q What could have caused
minutes more before the train stopped at the next barrio, Lusacan, the fracture of the skull and
the going out of the brain?
 A That is the impact against a
steel object. (TSN., pp. 81-
82, July 1, 1959)
The Court of First Instance of Quezon convicted defendant-appellant
Clemente Briñas for double homicide thru reckless imprudence but
acquitted Hermogenes Buencamino and Victor Millan The dispositive
portion of the decision reads: têñ.£îhqwâ£
WHEREFORE, the court finds the defendant
Clemente Briñas guilty beyond doubt of the crime
of double homicide thru reckless imprudence,
defined and punished under Article 305 in
connection with Article 249 of the Revised Penal
Code, and sentences him to suffer six (6) months
and one (1) day ofprision correccional to
indemnify the heirs of the deceased Martina Bool
and Emelita Gesmundo in the amounts of P6,000
and P3,000, respectively, with subsidiary
imprisonment in case of insolvency not to exceed
one-third of the principal penalty, and to pay the
costs.
For lack of sufficient evidence against the
defendant Hermogenes Buencamino and on the
ground of reasonable doubt in the case of
defendant Victor Millan the court hereby acquits
them of the crime charged in the information and
their bail bonds declared cancelled.
As to the responsibility of the Manila Railroad
Company in this case, this will be the subject of
court determination in another proceeding.
On appeal, the respondent Court of Appeals affirmed the judgment of
the lower court.
During the pendency of the criminal prosecution in the Court of First
Instance of Quezon, the heirs of the deceased victims filed with the
same court, a separate civil action for damages against the Manila
Railroad Company entitled "Civil Case No. 5978, Manaleyo
Gesmundo, et al., v. Manila Railroad Company". The separate civil
action was filed for the recovery of P30,350.00 from the Manila
Railroad Company as damages resulting from the accident.
The accused-appellant alleges that the Court of Appeals made the
following errors in its decision:
I têñ.£îhqwâ£
THE HONORABLE COURT OF APPEALS
ERRED IN CONVICTING PETITIONER-
APPELLANT UNDER THE FACTS AS FOUND
BY SAID COURT; and
II têñ.£îhqwâ£
THE HONORABLE COURT OF APPEALS
ERRED IN INCLUDING THE PAYMENT OF
DEATH INDEMNITY BY THE PETITIONER-
APPELLANT, WITH SUBSIDIARY
IMPRISONMENT IN CASE OF INSOLVENCY,
AFTER THE HEIRS OF THE DECEASED HAVE
ALREADY COMMENCED A SEPARATE CIVIL
ACTION FOR DAMAGES AGAINST THE
RAILROAD COMPANY ARISING FROM THE
SAME MISHAP.
We see no error in the factual findings of the respondent court and in
the conclusion drawn from those findings.
It is undisputed that the victims were on board the second coach
where the petitioner-appellant was assigned as conductor and that
when the train slackened its speed and the conductor shouted
"Lusacan, Lusacan", they stood up and proceeded to the nearest
exit. It is also undisputed that the train unexpectedly resumed its
regular speed and as a result "the old woman and the child stumbled
and they were seen no more.
In finding petitioner-appellant negligent, respondent
Court têñ.£îhqwâ£
xxx xxx xxx
The appellant's announcement was premature
and erroneous, for it took a full three minutes
more before the next barrio of Lusacan was
reached. In making the erroneous and premature
announcement, appellant was negligent. He
ought to have known that train passengers
invariably prepare to alight upon notice from the
conductor that the destination was reached and
that the train was about to stop. Upon the facts, it
was the appellant's negligent act which led the
victims to the door. Said acts virtually exposed
the victims to peril, for had not the appellant
mistakenly made the announcement, the victims
would be safely ensconced in their seats when
the train jerked while picking up speed, Although
it might be argued that the negligent act of the
appellant was not the immediate cause of, or the
cause nearest in time to, the injury, for the train
jerked before the victims stumbled, yet in legal
contemplation appellant's negligent act was the
proximate cause of the injury. As this Court held
in Tucker v. Milan, CA G.R. No. 7059-R, June 3,
1953: 'The proximate cause of the injury is not
necessarily the immediate cause of, or the cause
nearest in time to, the injury. It is only when the
causes are independent of each other that the
nearest is to be charged with the disaster. So
long as there is a natural, direct and continuous
sequence between the negligent act the injury
(sic) that it can reasonably be said that but for the
act the injury could not have occurred, such
negligent act is the proximate cause of the injury,
and whoever is responsible therefore is liable for
damages resulting therefrom. One who
negligently creates a dangerous condition cannot
escape liability for the natural and probable
consequences thereof, although the act of a third
person, or an act of God for which he is not
responsible intervenes to precipitate the loss.
xxx xxx xxx
It is a matter of common knowledge and experience about common
carriers like trains and buses that before reaching a station or
flagstop they slow down and the conductor announces the name of
the place. It is also a matter of common experience that as the train
or bus slackens its speed, some passengers usually stand and
proceed to the nearest exit, ready to disembark as the train or bus
comes to a full stop. This is especially true of a train because
passengers feel that if the train resumes its run before they are able
to disembark, there is no way to stop it as a bus may be stopped.
It was negligence on the conductor's part to announce the next flag
stop when said stop was still a full three minutes ahead. As the
respondent Court of Appeals correctly observed, "the appellant's
announcement was premature and erroneous.
That the announcement was premature and erroneous is shown by
the fact that immediately after the train slowed down, it unexpectedly
accelerated to full speed. Petitioner-appellant failed to show any
reason why the train suddenly resumed its regular speed. The
announcement was made while the train was still in Barrio Lagalag.
The proximate cause of the death of the victims was the premature
and erroneous announcement of petitioner' appelant Briñas. This
announcement prompted the victims to stand and proceed to the SO ORDERED.1äwphï1.ñët
nearest exit. Without said announcement, the victims would have
been safely seated in their respective seats when the train jerked as Teehankee (Chairman), Melencio-Herrera; Plana and Relova, JJ.,
it picked up speed. The connection between the premature and concur.
erroneous announcement of petitioner-appellant and the deaths of
the victims is direct and natural, unbroken by any intervening efficient
causes.

Petitioner-appellant also argues that it was negligence per se for

Martina Bool to go to the door of the coach while the train was still in
motion and that it was this negligence that was the proximate cause
of their deaths.

We have carefully examined the records and we agree with the

respondent court that the negligence of petitioner-appellant in
prematurely and erroneously announcing the next flag stop was the
proximate cause of the deaths of Martina Bool and Emelita
Gesmundo. Any negligence of the victims was at most contributory
and does not exculpate the accused from criminal liability.

With respect to the second assignment of error, the petitioner argues

that after the heirs of Martina Bool and Emelita Gesmundo had
actually commenced the separate civil action for damages in the
same trial court during the pendency of the criminal action, the said
court had no more power to include any civil liability in its judgment of
conviction.

The source of the obligation sought to be enforced in Civil Case No.

5978 is culpa contractual, not an act or omission punishable by law.
We also note from the appellant's arguments and from the title of the
civil case that the party defendant is the Manila Railroad Company
and not petitioner-appellant Briñas Culpa contractual and an act or
omission punishable by law are two distinct sources of obligation.

The petitioner-appellant argues that since the information did not

allege the existence of any kind of damages whatsoever coupled by
the fact that no private prosecutors appeared and the prosecution
witnesses were not interrogated on the issue of damages, the trial
court erred in awarding death indemnity in its judgment of conviction.

A perusal of the records clearly shows that the complainants in the

criminal action for double homicide thru reckless imprudence did not
only reserve their right to file an independent civil action but in fact
filed a separate civil action against the Manila Railroad Company.

The trial court acted within its jurisdiction when, despite the filing with
it of the separate civil action against the Manila Railroad Company, it
still awarded death indemnity in the judgment of conviction against
the petitioner-appellant.

It is well-settled that when death occurs as a result of the commission

of a crime, the following items of damages may be recovered: (1) an
indemnity for the death of the victim; (2) an indemnity for loss of
earning capacity of the deceased; (3) moral damages; (4) exemplary
damages; (5) attorney's fees and expenses of litigation, and (6)
interest in proper cases.

The indemnity for loss of earning capacity, moral damages,

exemplary damages, attorney's fees, and interests are recoverable
separately from and in addition to the fixed slim of P12,000.00
corresponding to the indemnity for the sole fact of death. This
indemnity arising from the fact of death due to a crime is fixed
whereas the others are still subject to the determination of the court
based on the evidence presented. The fact that the witnesses were
not interrogated on the issue of damages is of no moment because
the death indemnity fixed for death is separate and distinct from the
other forms of indemnity for damages.

WHEREFORE, the judgment appealed from is modified in that the

award for death indemnity is increased to P12,000.00 for the death of
Martina Bool instead of P6,000.00 and P12,000.00 for the death of
Emelita Gesmundo instead of P3,000.00, but deleting the subsidiary
imprisonment in case of insolvency imposed by the lower court. The
judgment is AFFIRMED in all other respects.

Transportation Case Digest: Isaac V. A.L. Ammen Trans. Co. (1957)
G.R.No. L-9671 August 23, 1957
Lessons Applicable: Legal Effect (Transportation)
FACTS:
 May 31, 1951: Cesar Isaac boarded Bus No. 31 from Ligao,
Albay bound for Pili, Camarines Sur and seated himself on the
left side resting his left arm on the window sill but with his left
elbow outside the window
 Before reaching his destination, a pick-up car at full speed and
was running outside of its proper lane came from the opposite
direction
 The driver of the bus swerved the bus to the very extreme right
of the road until its front and rear wheels have gone over the
pile of stones or gravel situated on the rampart of the road.
 The bus could not bus farther right and run over a greater
portion of the pile of gravel, the peak of which was about 3 feet
high, without endangering the safety of his passengers.
 Despite efforts, the rear left side of the bus was hit by the pick-
up car
 He was rushed to a hospital in Iriga, Camarines Sur where he
was given blood transfusion to save his life
 After 4 days, he was transferred to another hospital in Tabaco,
Albay, where he under went treatment for 3 months
 Later, he was moved to the Orthopedic Hospital where he was
operated on and stayed for another 2 months.
 He incurred expenses of P623.40, excluding medical fees which
were paid by A.L. Ammen Trans. Co.
 Trial Court: Dismissed the complaint - collision occurred due to
the negligence of the driver of the pick-up car
ISSUE: W/N if there is no negligence on the part of the common
carrier but that the accident resulting in injuries is due to causes
which are inevitable and which could not have been avoided or
anticipated notwithstanding the exercise of that high degree of care
and skill which the carrier is bound to exercise for the safety of his
passengers neither the common carrier nor the driver is liable
therefor
HELD: YES. Appealed decision is AFFIRMED.
ART. 1733. Common carriers, from the nature of their business and
for reasons of public policy, are bound to observe extra ordinary
diligence in the vigilance over the goods and for the safety of the
passengers transported by them according to all the circumstances
of each case.
Such extraordinary diligence in the vigilance over the goods is further
expressed in articles 1734, 1735, and 1745, Nos. 5, 6, and 7, while
the extraordinary diligence for the safety of the passengers is further
set forth in articles 1755 and 1756 Ooom.
ART. 1755. A common carrier is bound to carry the passengers
safely as far as human care and foresight can provide, using the
utmost diligence of very cautious persons, with a due regard for all
the circumstances.
ART. 1756. In case of death of or injuries to passengers, common
carriers are presumed to have been at fault or to have acted
negligently, unless they prove that they observed extraordinary
diligence as prescribed in articles 1733 and 1755.
 principles governing the liability of a common carrier:
1. the liability of a carrier is contractual and arises upon breach
of its obligation. There is breach if it fails to exert extraordinary
diligence according to all circumstances of each case
2. a carrier is obliged to carry its passenger with the utmost
diligence of a very cautious person, having due regard for all
the circumstances
3. a carrier is presumed to be at fault or to have acted
negligently in case of death of, or injury to, passengers, it
being its duty to prove that it exercised extraordinary diligence
4. the carrier is not an insurer against all risks of travel
 where a carrier's employee is confronted with a sudden
emergency, the fact that he is obliged to act quickly and without
a chance for deliberation must be taken into account, and he is
held to the some degree of care that he would otherwise be
required to exercise in the absence of such emergency but must
exercise only such care as any ordinary prudent person would
exercise under like circumstances and conditions, and the
failure on his part to exercise the best judgment the case
renders possible does not establish lack of care and skill on his
part
 Considering all the circumstances, we are persuaded to
conclude that the driver of the bus has done what a prudent
man could have done to avoid the collision
 It is true that Isaac's contributory negligence cannot relieve A.L.
Ammen of its liability but will only entitle it to a reduction of the
amount of damage caused (Article 1762, new Civil Code), but
this is a circumstance which further militates against the position
taken by Isaac
August 23, 1957
G.R. No. L-9671
CESAR L. ISAAC, plaintiff-appellant,
vs.
A. L. AMMEN TRANSPORTATION CO., INC., defendant-appellee.
Angel S. Gamboa for appellant.
Manuel O. Chan for appellee.
, J.:
A. L. Ammen Transportation Co., Inc., hereinafter referred to as
defendant, is a corporation engaged in the business of transporting
passengers by land for compensation in the Bicol provinces and one
of the lines it operates is the one connecting Legaspi City, Albay with
Naga City, Camarines Sur. One of the buses which defendant was
operating is Bus No. 31. On May 31, 1951, plaintiff boarded said bus
as a passenger paying the required fare from Ligao, Albay bound for
Pili, Camarines Sur, but before reaching his destination, the bus
collided with a motor vehicle of the pick-up type coming from the
opposite direction, as a result of which plaintiff's left arm was
completely severed and the severed portion fell inside the bus.
Plaintiff was rushed to a hospital in Iriga, Camarines Sur where he
was given blood transfusion to save his life. After four days, he was
transferred to another hospital in Tabaco, Albay, where he under
went treatment for three months. He was moved later to the
Orthopedic Hospital where he was operated on and stayed there for
another two months. For these services, he incurred expenses
amounting to P623.40, excluding medical fees which were paid by
defendant.
As an aftermath, plaintiff brought this action against defendants for
damages alleging that the collision which resulted in the loss of his
left arm was mainly due to the gross incompetence and recklessness
of the driver of the bus operated by defendant and that defendant
incurred in culpa contractual arising from its non-compliance with its
obligation to transport plaintiff safely to his, destination. Plaintiff prays
for judgment against defendant as follows: (1) P5,000 as expenses
for his medical treatment, and P3,000 as the cost of an artificial arm,
or a total of P8,000; (2) P6,000 representing loss of earning; (3)
P75,000 for diminution of his earning capacity; (4) P50,000 as moral
damages; and (5) P10,000 as attorneys' fees and costs of suit.
Defendant set up as special defense that the injury suffered by
plaintiff was due entirely to the fault or negligence of the driver of the
pick-up car which collided with the bus driven by its driver and to the
contributory negligence of plaintiff himself. Defendant further claims
that the accident which resulted in the injury of plaintiff is one which
defendant could not foresee or, though foreseen, was inevitable.
The after trial found that the collision occurred due to the negligence
of the driver of the pick-up car and not to that of the driver of the bus
it appearing that the latter did everything he could to avoid the same
but that notwithstanding his efforts, he was not able to avoid it. As a
consequence, the court dismissed complaint, with costs against
plaintiff. This is an appeal from said decision.
It appears that plaintiff boarded a bus of defendant as paying
passenger from Ligao, Albay, bound for Pili, Camarines Sur, but
before reaching his destination, the bus collided with a pick-up car
which was coming from the opposite direction and, as a, result, his
left arm was completely severed and fell inside the back part of the
bus. Having this background in view, and considering that plaintiff
chose to hold defendant liable on its contractual obligation to carry
him safely to his place of destination, it becomes important to
determine the nature and extent of the liability of a common carrier to
a passenger in the light of the law applicable in this jurisdiction.
In this connection, appellant invokes the rule that, "when an action is
based on a contract of carriage, as in this case, all that is necessary
to sustain recovery is proof of the existence of the contract of the
breach thereof by act or omission", and in support thereof, he cites
several Philippine cases.1 With the ruling in mind, appellant seems to
imply that once the contract of carriage is established and there is
proof that the same was broken by failure of the carrier to transport
the passenger safely to his destination, the liability of the former
attaches. On the other hand, appellee claims that is a wrong
presentation of the rule. It claims that the decisions of this Court in
the cases cited do not warrant the construction sought to be placed
upon, them by appellant for a mere perusal thereof would show that
the liability of the carrier was predicated not upon mere breach of its
contract of carriage but upon the finding that its negligence was
found to be the direct or proximate cause of the injury complained of.
Thus, appellee contends that "if there is no negligence on the part of
the common carrier but that the accident resulting in injuries is due to
causes which are inevitable and which could not have been avoided
or anticipated notwithstanding the exercise of that high degree of
care and skill which the carrier is bound to exercise for the safety of
his passengers", neither the common carrier nor the driver is liable
therefor vipWZCFqQ.
We believe that the law concerning the liability of a common carrier
has now suffered a substantial modification in view of the innovations
introduced by the new Civil Code. These innovations are the ones
embodied in Articles 1733, 1755 and 1756 in so far as the relation
between a common carrier and its passengers is concerned, which,
for ready reference, we quote hereunder:
ART. 1733. Common carriers, from the nature of their business and
for reasons of public policy, are bound to observe extra ordinary
diligence in the vigilance over the goods and for the safety of the
passengers transported by them according to all the circumstances
of each case.
Such extraordinary diligence in the vigilance over the goods is further
expressed in articles 1734, 1735, and 1745, Nos. 5, 6, and 7, while
the extraordinary diligence for the safety of the passengers is further
set forth in articles 1755 and 1756 Ooom.
ART. 1755. A common carrier is bound to carry the passengers
safely as far as human care and foresight can provide, using the
utmost diligence of very cautious persons, with a due regard for all
the circumstances.
ART. 1756. In case of death of or injuries to passengers, common
carriers are presumed to have been at fault or to have acted
negligently, unless they prove that they observed extraordinary
diligence as prescribed in articles 1733 and 1755.
The Code Commission, in justifying this extraordinary diligence
required of a common carrier, says the following:
A common carrier is bound to carry the passengers safely as far as
human care and foresight can provide, using the utmost deligence of
very cautions persons, with due regard for all circumstances. This
extraordinary diligence required of common carriers is calculated to
protect the passengers from the tragic mishaps that frequently occur
in connection with rapid modern transportation. This high standard of
care is imperatively demanded by the precariousness of human life
and by the consideration that every person must in every way be
safeguarded against all injury. (Report of the Code Commission, pp.
35-36)" (Padilla, Civil Code of the Philippines, Vol. IV, 1956 ed., p.
197).

From the above legal provisions, we can make the following
restatement of the principles governing the liability of a common
carrier: (1) the liability of a carrier is contractual and arises upon
breach of its obligation. There is breach if it fails to exert
extraordinary diligence according to all circumstances of each case;
(2) a carrier is obliged to carry its passenger with the utmost diligence
of a very cautious person, having due regard for all the
circumstances; (3) a carrier is presumed to be at fault or to have
acted negligently in case of death of, or injury to, passengers, it being
its duty to prove that it exercised extraordinary diligence; and (4) the
carrier is not an insurer against all risks of travel.
The question that now arises is: Has defendant observed
extraordinary diligence or the utmost diligence of every cautious
person, having due regard for all circumstances, in avoiding the
collision which resulted in the injury caused to the plaintiff?
After examining the evidence in connection with how the collision
occurred, the lower court made the following finding:
Hemos examinado muy detenidamente las pruebas presentadas en
la vista, principalmente, las declaraciones que hemos acotado arriba,
y hernos Ilegado a la conclusion de que el demandado ha hecho,
todo cuanto estuviere de su parte para evitar el accidente, pero sin
embargo, no ha podido evitarlo.
EI hecho de que el demandado, antes del choque, tuvo que hacer
pasar su truck encima de los montones de grava que estaban
depositados en la orilla del camino, sin que haya ido mas alla, por el
grave riesgo que corrian las vidas de sus pasajeros, es prueba
concluyente de lo que tenemos dicho, a saber: — que el cuanto
esuba de su parte, para evitar el accidente, sin que haya
podidoevitardo, por estar fuera de su control.
The evidence would appear to support the above finding. Thus, it
appears that Bus No. 31, immediately prior to the collision, was
running at a moderate speed because it had just stopped at the
school zone of Matacong, Polangui, Albay. The pick-up car was at
full speed and was running outside of its proper lane. The driver of
the bus, upon seeing the manner in which the pick-up was then
running, swerved the bus to the very extreme right of the road until its
front and rear wheels have gone over the pile of stones or gravel
situated on the rampart of the road. Said driver could not move the
bus farther right and run over a greater portion of the pile, the peak of
which was about 3 feet high, without endangering the safety of his
passengers. And notwithstanding all these efforts, the rear left side of
the bus was hit by the pick-up car.
Of course, this finding is disputed by appellant who cannot see eye to
eye with the evidence for the appellee and insists that the collision
took place because the driver of the bus was going at a fast speed.
He contends that, having seen that a car was coming from the
opposite direction at a distance which allows the use of moderate
care and prudence to avoid an accident, and knowing that on the
side of the road along which he was going there was a pile of gravel,
the driver of the bus should have stopped and waited for the vehicle
from the opposite direction to pass, and should have proceeded only
after the other vehicle had passed. In other words, according to
appellant, the act of the driver of the bus in squeezing his way
through of the bus in squeezing his way through between the
oncoming pick-up and the pile of gravel under the circumstances was
considered negligent.
But this matter is one of credibility and evaluation of the evidence.
This is evidence. This is the function of the trial court. The trial court
has already spoken on this matter as we have pointed out above.
This is also a matter of appreciation of the situation on the part of the
driver. While the position taken by appellant appeals more to the
sense of caution that one should observe in a given situation to avoid
an accident or mishap, such however can not always be expected
from one who is placed suddenly in a predicament where he is not
given enough time to take the course of action as he should under
ordinary circumstances. One who is placed in such a predicament
cannot exercise such coolness or accuracy of judgment as is
required of him under ordinary circumstances and he cannot
therefore be expected to observe the same judgment, care and
precaution as in the latter. For this reason, authorities abound where
failure to observe the same degree of care that as ordinary prudent
man would exercise under ordinary circumstances when confronted
with a sadden emergency was held to be warranted and a
justification to exempt the carrier from liability. Thus, it was held that
"where a carrier's employee is confronted with a sudden emergency,
the fact that he is obliged to act quickly and without a chance for
deliberation must be taken into account, and he is held to the some
degree of care that he would otherwise be required to exercise in the
absence of such emergency but must exercise only such care as any
ordinary prudent person would exercise under like circumstances and
conditions, and the failure on his part to exercise the best judgment
the case renders possible does not establish lack of care and skill on
his part which renders the company, liable. . . . (13 C. J. S., 1412; 10
C.J.970). Considering all the circumstances, we are persuaded to
conclude that the driver of the bus has done what a prudent man
could have done to avoid the collision and in our opinion this relieves
appellee from legibility under our law uK77hp8Rt8.
A circumstances which miliates against the stand of appellant is the
fact borne out by the evidence that when he boarded the bus in
question, he seated himself on the left side thereof resting his left
arm on the window sill but with his left elbow outside the window, this
being his position in the bus when the collision took place. It is for this
reason that the collision resulted in the severance of said left arm
from the body of appellant thus doing him a great damage. It is
therefore apparent that appellant is guilty of contributory negligence.
Had he not placed his left arm on the window sill with a portion
thereof protruding outside, perhaps the injury would have been
avoided as is the case with the other passenger. It is to be noted that
appellant was the only victim of the collision.
It is true that such contributory negligence cannot relieve appellee of
its liability but will only entitle it to a reduction of the amount of
damage caused (Article 1762, new Civil Code), but this is a
circumstance which further militates against the position taken by
appellant in this case.
It is the prevailing rule that it is negligence per se for a passenger on
a railroad voluntarily or inadvertently to protrude his arm, hand,
elbow, or any other part of his body through the window of a moving
car beyond the outer edge of the window or outer surface of the car,
so as to come in contact with objects or obstacles near the track, and
that no recovery can be had for an injury which but for such
negligence would not have been sustained. (10 C. J. 1139)
Plaintiff, (passenger) while riding on an interurban car, to flick the
ashes, from his cigar, thrust his hand over the guard rail a sufficient
distance beyond the side line of the car to bring it in contact with the
trunk of a tree standing beside the track; the force of the blow
breaking his wrist. Held, that he was guilty of contributory negligence
as a matter of law. (Malakia vs. Rhode Island Co., 89 A., 337.)
Wherefore, the decision appealed from is affirmed, with cost against
appellant.
Paras, C.J., Bengzon, Padilla, Montemayor, Reyes, A., Labrador,
Concepcion, Endencia and Felix, JJ., concur.