G.R. No.

L-15247 February 28, 1962 Said court rendered judgment — which on appeal was affirmed by the
Court of Appeals — holding petitioner and Luna solidarily liable to
DE LEON BROKERAGE CO., INC., petitioner, respondent for the sums of P1,183.70 for actual expenses; P3,000.00
vs. for unpaid medical fees; P7,000.00 as moral damages; and P1,000.00
THE COURT OF APPEALS and ANGELINE as attorney'sfees; all amount to earn legal interest from the filing of the
STEEN, respondents. complaint, plus costs.

Abelardo P. Cecilio and H. Datuin, Jr. for petitioner. Seeking reversal of such affirmance by the AppellanteCourt, De Leon
Vergara and Dayut for respondents. Brokerage Claims that: (1) the allegations in respondent's complaint
were so ambiguous that it was not clear whether she was suing for
BENGZON , C.J.: damages resulting from a quasi-delict or for civil liability arising from
crime,but since the averments therein are more characteristic of an
Review of the decision of the Court of Appeals affirming the decision action of the latter nature, the same, as against petitioner, is premature
of the Court of First Instance of Manila which ordered petitioner and for failure to allege the insolvency of its employee; (2) the judgment
its employee, Augusto Luna, to pay jointly and severally to respondent of conviction Exh. B, is not admissible against it as evidence of
Angeline Steen P12,18370 as actual and moral damages, and a quasi-delict; (3)the employee, Luna, was not in the discharge of his
attorney's fees. dutiesat the time of the accident; and (4) it cannot be held solidarily
liable with Luna for damages.
The awards were for injuries said respondent suffered as a result of the
collision between the passenger jeepney in which she was riding, and The court of origin and the appellate court correctly considered
petitioner's cargo truck reclessly driven by its employee, Luna, and for respondent's complaint to be based on a quasidelict. She alleged that
which the latter had been prosecuted and convicted of the crime of she suffered unjuries because of the carelessness and imprudence of
homicide with physical injuries thru reckless imprudence.In the petitioner's chauffeur who was driving the cargo truck TH-776
criminal action against Luna (and the driver of the passenger jeepney, belonging to petitioner,which truck collided with the passenger
who was, however, acquitted), respondent had reserved her right to jeepney wherein shwe was riding. Since averment had been made of
file a separate civil action. the employer-employee relationship and of the damages caused by the
employee on occasion of his function, there is a clear statement of a
right of action under Article 2180 of the Civil Code. The complaint
After a judgment of conviction had been rendered, respondent filed in
the court of first inst ance of Manila, an action for recovery of damages does not, and did not have to allege that petitioner did not exercise due
against Luna and petitioner.As proof of Luna's negligence, she deligence in choosing and supervising Luna, because this is a matter
presented during the hearing the judgment of conviction in the of defense.
criminal case, Exh. B; and likewise established her claim for actual,
moral and exemplary damages. Defendants, that is, Luna and Contrary to petitioner's view, respondent is holding it liable for its own
petitioner, sought to prove by means of the former's testimony that he lack of car. Her allegation "that the acts of the defendants above
was not engaged in the performance of his duties at the time of the described consitutute gross negligence and recklessness", plainly
accident.
refers to petitioner's act of employing Luna as driver of its cargo truck, had reserved. The only conclusionthat can reasonably be drawn is that
and to Luna's careless manner of driving it. she did not want the question of damages threshed out in the criminal
action, but preferred to have this issue decided in a separate civil
Whatever doubts remain as to the nature of respondent's action are action.
resolved by her prayer that petitioner and its employee be held
solidarily liable. At any rate, if respondent's complaint, which was clear enough, had
created confusion in petitioner's mind as to the foundation of her cause
According to petitioner, what causes confusion as to the nature of of action, then it should have moved for a more definite statement of
respondent's action are the allegations of Luna's conviction (a copy of the same before the trial.
the judgment of conviction was attached of her civil action —
circumstances, petitionerargues, which infallibly characterize an However, it seems that petitioner understood quite wellthat it was
action for civil indemnityunder the criminal code. being held liablie under the civil code. In its answer, it alleged as an
affirmative defense that in the selection and supervision of its
But respondent clearly did not base her suit on the criminal conviction. employees and drivers, it had exercised the diligence of a good father
This fact, it is true, was alleged in a paragraph separate from her of a family — a defense available only to an employer being sued for
allegation of Luna's negligene as having been the cause of her injuries; a quasi-delict. Petitioner arques that, not knowing the nature of
but mention of the criminal conviction merely tended to support her respondent's action and deciding to play it safe,it put up defense both
claim that Luna had been recklessly negligent in driving the truck. against a suit for quasi-delict and against an action for civil liability
Being evidentiary, the allegation could have beeb dusregarded. arising from crime. Yet,it did not aver that the complaint failed to
alleged that its employee was insolvent — the defense consistent with
Respondent neither had to wait for the termination of the criminal an action against an employer for subsidiary liabilityunder the
proceeding nor to reserve in the same her right to file a separate civil criminal code. What it alleged was that the complaint failed to state a
action.1 She waited for the results of the criminal action because she cause of action as against it,which could nt be sustained since the
wanted to besure which driver and respective employer she could complaint sufficiently alleges an action based on quasi-delict and the
rightly sue, since both Luna and the driver of the passenger jeepney court could validly have granted respondent's prayer for relief.4
were prosecuted. An she reserved because otherwise, the court in the
criminal proceeding would have awarded her indemnity, since the Considering that the judgment of conviction, Exh. B,had been
civil action for recoveryof civil liablity arising from the offense is admitted without objection, its competency can no longer be
deemed instuted with the criminal action.2 In such event, she would questioned on appeal.5 It established the fact of Luna's negligence,
no longer be able to file the separate civil action contemplated by the giving rise to the presumption that petitioner had been negligent in the
civil code, not because of failure to reserve the same but because she selection and supervision of its employees.6 And petitioner failed to
would have already received indemnity forher injuries. 3 prove that it had exercised such requisite care and deligence as would
relieve it from responsibility.
Plainly, the reservation made in the criminal action does not preclude
a subsequent action based on a quasi-delict.It cannot be inferred But, was Luna in the performance of his duties at the time of the
therefrom that respondent had chosento file the very civil action she colision? He testified that on the day of the accident he had been
instructed to go to Pampanga, from there to proceed to Nueva Ecija, Padilla, Bautista Angelo, Labrador, Concepcion, Reyes, J.B.L.,
but that after unloading his cargo in Pampanga, he at once returned to Paredes, Dizon and De Leon, JJ., concur.
Manila.However, his reason for immediately returning to Manilais not Barrera, J., took no part.
clear. He could have returned for purposes of repair. It does not appear
that he was on an errand of his own. In the absence of determinative
proof that the deviationwas so complete as would constitute a
cessation orsuspension of his service, petitioner should be held
liable, 7 In fact, the Court of Appeals disbelieved the alleged
violationof instructions.

Since both Luna and petitioner are responsible for the quasi-delict,
their liablity is solidary8, although the latter can recover from the
former whatever sums it pays to respondent. 9

Petitioner invites attention to Art. 2184, of the Civil Code, and insists
that it is only in the instance covered thereby — when the owner of
the motor vehicle is riding therein at the time of the mishap — that the
employer becomes solidarily liable with the driver for any accident
resulting from the latter's negligence. That article refers to owners of
vehicles who are not included in the terms of Art. 2180 "as owners of
an establishement or enterprise."

As alternative remedy, petitioner asks that the damages awarded be

reduced. The moral damages of P7,000.00 is amply justified by the
pain and disfigurement suffered by respondent, a pretty girl of sixteen
(at the time of the accident), whose left arm had been scraped bare of
flesh from shoulder to elbow because of the accident. As a result, she
had to undergo seven operations which cost P3,000.00 — a reasonable
enough sum. Attorney's fees of P1,000.00 is not unconscionable
considering that the case was appealed to this Court.

IN VIEW OF THE FOREGOING, the judgment of the Court of

Appeals is hereby affirmed with costs.
G.R. No. 129029 April 3, 2000 2,000 cases of empty bottles of beer grande, willfully,
unlawfully and feloniously drove and operated the same while
RAFAEL REYES TRUCKING CORPORATION, petitioner, along the National Highway of Barangay Tagaran, in said
vs. Municipality, in a negligent, careless and imprudent manner,
PEOPLE OF THE PHILIPPINES and ROSARIO P. DY (for without due regard to traffic laws, rules and ordinances and
herself and on behalf of the minors Maria Luisa, Francis Edward, without taking the necessary precautions to prevent injuries to
Francis Mark and Francis Rafael, all surnamed Dy), respondents. persons and damage to property, causing by such negligence,
carelessness and imprudence the said trailer truck to hit and
PARDO, J.: bump a Nissan Pick-up bearing Plate No. BBG-957 driven by
Feliciano Balcita and Francisco Dy, Jr., @ Pacquing, due to
The case is an appeal via certiorari from the amended decision 1 of the irreversible shock, internal and external hemorrhage and
Court of Appeals 2 affirming the decision and supplemental decision of multiple injuries, open wounds, abrasions, and further causing
the trial court,3 as follows: damages to the heirs of Feliciano Balcita in the amount of
P100,000.00 and to the death of Francisco Dy, Jr.; @
IN VIEW OF THE FOREGOING, judgment is hereby Pacquing and damages to his Nissan Pick-Up bearing Plate
rendered dismissing the appeals interposed by both accused No. BBG-957 in the total amount of P2,000,000.00.
and Reyes Trucking Corporation and affirming the Decision
and Supplemental Decision dated June 6, 1992 and October CONTRARY TO LAW.
26, 1992 respectively.
Cauayan, Isabela, October 10, 1989.
4
SO ORDERED.
(Sgd.) FAUSTO C. CABANTAC
The facts are as follows: Third Assistant Provincial Prosecutor

On October 10, 1989, Provincial Prosecutor Patricio T. Durian of Upon arraignment on October 23, 1989, the accused entered a plea of
Isabela filed with the Regional Trial Court, Isabela, Branch 19, not guilty. On the same occasion, the offended parties (Rosario P. Dy
Cauayan an amended information charging Romeo Dunca y de Tumol and minor children and Angelina M. Balcita and minor son Paolo)
with reckless imprudence resulting in double homicide and damage to made a reservation to file a separate civil action against the accused
property, reading as follows: arising from the offense charged.5 On November 29, 1989, the
offended parties actually filed with the Regional Trial Court, Isabela,
That on or about the 20th day of June, 1989, in the Branch 19, Cauayan a complaint against petitioner Rafael Reyes
Trucking Corporation, as employer of driver Romeo Dunca y de
Municipality of Cauayan, Province of Isabela, Philippines,
and within the jurisdiction of this Honorable Court, the said Tumol, based on quasi delict. The petitioner settled the claim of the
accused being the driver and person-in-charge of a Trailer heirs of Feliciano Balcita (the driver of the other vehicle involved in
Truck Tractor bearing Plate No. N2A-867 registered in the the accident). The private respondents opted to pursue the criminal
action but did not withdraw the civil case quasi ex delicto they filed
name of Rafael Reyes Trucking Corporation, with a load of
against petitioner. On December 15, 1989, private respondents of the road covering the full width of the truck's right lane
withdrew the reservation to file a separate civil action against the going south and about six meters in length. These made the
accused and manifested that they would prosecute the civil aspect ex surface of the road uneven because the potholes were about
delicto in the criminal action.6 However, they did not withdraw the five to six inches deep. The left lane parallel to this damaged
separate civil action based on quasi delict against petitioner as portion is smooth. As narrated by Ferdinand Domingo, before
employer arising from the same act or omission of the accused driver. 7 approaching the potholes, he and Dunca saw the Nissan with
its headlights on coming from the opposite direction. They
Upon agreement of the parties, the trial court consolidated both used to evade this damaged road by taking the left lance but
criminal and civil cases and conducted a joint trial of the same. at that particular moment, because of the incoming vehicle,
they had to run over it. This caused the truck to bounce wildly.
The facts, as found by the trial court, which appear to be undisputed, Dunca lost control of the wheels and the truck swerved to the
are as follows: left invading the lane of the Nissan. As a result, Dunca's
vehicle rammed the incoming Nissan dragging it to the left
The defendant Rafael Reyes Trucking Corporation is a shoulder of the road and climbed a ridge above said shoulder
domestic corporation engaged in the business of transporting where it finally stopped. (see Exh. A-5, p. 8, record). The
beer products for the San Miguel Corporation (SMC for Nissan was severely damaged (Exhs. A-7, A-8, A-9 and A-
Short) from the latter's San Fernando, Pampanga plant to its 14, pp. 9-11 record), and its two passengers, namely:
various sales outlets in Luzon. Among its fleets of vehicles for Feliciano Balcita and Francisco Dy, Jr. died instantly (Exh. A-
hire is the white truck trailer described above driven by 19) from external and internal hemorrhage and multiple
Romeo Dunca y Tumol, a duly licensed driver. Aside from the fractures (pp. 15 and 16, record).
Corporation's memorandum to all its drivers and helpers to
physically inspect their vehicles before each trip (Exh. 15, For the funeral expenses of Francisco Dy, Jr. her widow spent
pars. 4 & 5), the SMC's Traffic Investigator-Inspector P651,360.00 (Exh. I-3). At the time of his death he was 45
certified the roadworthiness of this White Truck trailer prior years old. He was the President and Chairman of the Board of
to June 20, 1989 (Exh. 17). In addition to a professional the Dynamic Wood Products and Development Corporation
driver's license, it also conducts a rigid examination of all (DWPC), a wood processing establishment, from which he
driver applicants before they are hired. was receiving an income of P10,000.00 a month. (Exh. D). In
the Articles of Incorporation of the DWPC, the spouses
In the early morning of June 20, 1989, the White Truck driven Francisco Dy, Jr. and Rosario Perez Dy appear to be
by Dunca left Tuguegarao, Cagayan bound to San Fernando, stockholders of 10,000 shares each with par value of P100.00
Pampanga loaded with 2,000 cases of empty beer "Grande" per share out of its outstanding and subscribed capital stock
bottles. Seated at the front right seat beside him was Ferdinand of 60,000 shares valued at P6,000,000.00 (Exhs. K-1 & 10-
Domingo, his truck helper ("pahinante" in Pilipino). At B). Under its 1988 Income Tax Returns (Exh. J) the DWPC
around 4:00 o'clock that same morning while the truck was had a taxable net income of P78,499.30 (Exh. J). Francisco
descending at a slight downgrade along the national road at Dy, Jr. was a La Salle University graduate in Business
Tagaran, Cauayan, Isabela, it approached a damaged portion Administration, past president of the Pasay Jaycees, National
 Treasurer and President of the Philippine Jaycees in 1971 and without any aggravating circumstance to offset the same, the
1976, respectively, and World Vice-President of Jaycees Court hereby sentences him to suffer two (2) indeterminate
International in 1979. He was also the recipient of numerous penalties of four months and one day of arresto mayor as
awards as a civic leader (Exh. C). His children were all minimum to three years, six months and twenty days as
studying in prestigious schools and spent about P180,000.00 maximum; to indemnify the Heirs of Francisco Dy. Jr. in the
for their education in 1988 alone (Exh. H-4). amount of P3,000,000.00 as compensatory damages,
P1,000,000.00 as moral damages, and P1,030,000.00 as
As stated earlier, the plaintiffs' procurement of a writ of funeral expenses;
attachment of the properties of the Corporation was declared
illegal by the Court of Appeals. It was shown that on 2. Ordering the plaintiff in Civil Case No. Br. 19-424 to pay
December 26, 1989, Deputy Sheriff Edgardo Zabat of the the defendant therein actual damages in the amount of
RTC at San Fernando, Pampanga, attached six units of Truck P84,000.00; and
Tractors and trailers of the Corporation at its garage at San
Fernando, Pampanga. These vehicles were kept under PC 3. Ordering the dismissal of the complaint in Civil Case No.
guard by the plaintiffs in said garage thus preventing the Br. 19-424.
Corporation to operate them. However, on December 28,
1989, the Court of Appeals dissolved the writ (p. 30, record) No pronouncement as to costs.
and on December 29, 1989, said Sheriff reported to this Court
that the attached vehicles were taken by the defendant's SO ORDERED.
representative, Melita Manapil (Exh. O, p. 31, record). The
defendant's general Manager declared that it lost P21,000.00
Cauayan, Isabela, June 6, 1992.
per day for the non-operation of the six units during their
attachment (p. 31, t.s.n., Natividad C. Babaran, proceedings
(Sgd.) ARTEMIO R. ALIVIA
on December 10, 1990).8
Regional Trial Judge9
On June 6, 1992, the trial court rendered a joint decision, the
On September 3, 1992, petitioner and the accused filed a notice of
dispositive portion of which reads as follows:
appeal from the joint decision. 10
WHEREFORE, in view of the foregoing considerations
On the other hand, private respondents moved for amendment of the
judgment is hereby rendered:
dispositive portion of the joint decision so as to hold petitioner
subsidiarily liable for the damages awarded to the private respondents
1. Finding the accused Romeo Dunca y de Tumol guilty
in the event of insolvency of the accused. 11
beyond reasonable doubt of the crime of Double Homicide
through Reckless Imprudence with violation of the Motor
On October 26, 1992, the trial court rendered a supplemental decision
Vehicle Law (Rep. Act No. 4136), and appreciating in his
amending the dispositive portion by inserting an additional paragraph
favor the mitigating circumstance of voluntary surrender
reading as follows:
 2:A — Ordering the defendant Reyes Trucking Corporation Petitioner raises three (3) grounds for allowance of the petition, which,
subsidiarily liable for all the damages awarded to the heirs of however, boil down to two (2) basic issues, namely:
Francisco Dy, Jr., in the event of insolvency of the accused
but deducting therefrom the damages of P84,000.00 awarded 1. May petitioner as owner of the truck involved in the
to said defendant in the next preceding paragraph; and . . . 12 accident be held subsidiarily liable for the damages awarded
to the offended parties in the criminal action against the truck
On November 12, 1992, petitioner filed with the trial court a driver despite the filing of a separate civil action by the
supplemental notice of appeal from the supplemental decision. 13 offended parties against the employer of the truck driver?

During the pendency of the appeal, the accused jumped bail and fled 2. May the Court award damages to the offended parties in the
to a foreign country. By resolution dated December 29, 1994, the criminal case despite the filing of a civil action against the
Court of Appeals dismissed the appeal of the accused in the criminal employer of the truck driver; and in amounts exceeding that
case. 14 alleged in the information for reckless imprudence resulting
in homicide and damage to property? 22
On January 6, 1997, the Court of Appeals rendered an amended
decision affirming that of the trial court, as set out in the opening We grant the petition, resolving under the circumstances pro hac
paragraph of this decision. 15 vice to remand the cases to the trial court for determination of the civil
liability of petitioner as employer of the accused driver in the civil
On January 31, 1997, petitioner filed a motion for reconsideration of action quasi ex delicto re-opened for the purpose.
the amended decision. 16
In negligence cases, the aggrieved party has the choice between (1) an
On April 21, 1997, the Court of Appeals denied petitioner's motion for action to enforce civil liability arising from crime under Article 100 of
reconsideration for lack of merit 17 the Revised Penal Code; and (2) a separate action for quasi
delict under Article 2176 of the Civil Code of the Philippines. Once
Hence, this petition for review. 18 the choice is made, the injured party can not avail himself of any other
remedy because he may not recover damages twice for the same
On July 21, 1997, the Court required respondents to comment on the negligent act or omission of the accused. 23 This is the rule against
petition within ten (10) days from notice. 19 double recovery.

On January 27, 1998, the Solicitor General filed his comment. 20 On In other words, "the same act or omission can create two kinds of
April 13, 1998, the Court granted leave to petitioner to file a reply and liability on the part of the offender, that is, civil liability ex delicto,
noted the reply it filed on March 11, 1998. 21 and civil liability quasi delicto" either of which "may be enforced
against the culprit, subject to the caveat under Article 2177 of the Civil
Code that the offended party can not recover damages under both
We now resolve to give due course to the petition and decide the case.
types of liability." 24
In the instant case, the offended parties elected to file a separate civil of the Civil Code, arising from the same act or omission of the
action for damages against petitioner as employer of the accused, accused. 27
based on quasi delict, under Article 2176 of the Civil Code of the
Philippines. Private respondents sued petitioner Rafael Reyes Pursuant to the provision of Rule 111, Section 1, paragraph 3 of the
Trucking Corporation, as the employer of the accused, to be 1985 Rules of Criminal Procedure, when private respondents, as
vicariously liable for the fault or negligence of the latter. Under the complainants in the criminal action, reserved the right to file the
law, this vicarious liability of the employer is founded on at least two separate civil action, they waived other available civil actions
specific provisions of law. predicated on the same act or omission of the accused-driver. Such
civil action includes the recovery of indemnity under the Revised
The first is expressed in Article 2176 in relation to Article 2180 of the Penal Code, and damages under Articles 32, 33, and 34 of the Civil
Civil Code, which would allow an action predicated on quasi-delict to Code of the Philippines arising from the same act or omission of the
be instituted by the injured party against the employer for an act or accused. 28
omission of the employee and would necessitate only a preponderance
of evidence to prevail. Here, the liability of the employer for the The intention of private respondents to proceed primarily and directly
negligent conduct of the subordinate is direct and primary, subject to against petitioner as employer of accused truck driver became clearer
the defense of due diligence in the selection and supervision of the when they did not ask for the dismissal of the civil action against the
employee. The enforcement of the judgment against the employer in latter based on quasi delict.
an action based on Article 2176 does not require the employee to be
insolvent since the nature of the liability of the employer with that of Consequently, the Court of Appeals and the trial court erred in holding
the employee, the two being statutorily considered joint tortfeasors, is the accused civilly liable, and petitioner-employer of the accused
solidary. 25 The second, predicated on Article 103 of the Revised Penal subsidiarily liable for damages arising from crime (ex delicto) in the
Code, provides that an employer may be held subsidiarily civilly liable criminal action as the offended parties in fact filed a separate civil
for a felony committed by his employee in the discharge of his duty. action against the employer based on quasi delict resulting in the
This liability attaches when the employee is convicted of a crime done waiver of the civil action ex delicto.
in the performance of his work and is found to be insolvent that
renders him unable to properly respond to the civil liability It might be argued that private respondents as complainants in the
adjudged. 26 criminal case withdrew the reservation to file a civil action against the
driver (accused) and manifested that they would pursue the civil
As regards the first issue, the answer is in the negative. Rafael Reyes liability of the driver in the criminal action. However, the withdrawal
Trucking Corporation, as employer of the accused who has been is ineffective to reverse the effect of the reservation earlier made
adjudged guilty in the criminal case for reckless imprudence, can not because private respondents did not withdraw the civil action against
be held subsidiarily liable because of the filing of the separate civil petitioner based on quasi delict. In such a case, the provision of Rule
action based on quasi delict against it. In view of the reservation to 111, Section 1, paragraph 3 of the 1985 Rules on Criminal Procedure
file, and the subsequent filing of the civil action for recovery of civil is clear that the reservation to file or the filing of a separate civil action
liability, the same was not instituted with the criminal action. Such results in a waiver of other available civil actions arising from the
separate civil action was for recovery of damages under Article 2176 same act or omission of the accused. Rule 111, Section 1, paragraph 2
enumerated what are the civil actions deemed waived upon such With regard to the second issue, the award of damages in the criminal
reservation or filing, and one of which is the civil indemnity under the case was improper because the civil action for the recovery of civil
Revised Penal Code. Rule 111, Section 1, paragraph 3 of the 1985 liability was waived in the criminal action by the filing of a separate
Rules on Criminal Procedure specifically provides: civil action against the employer. As enunciated in Ramos
vs. Gonong, 34 "civil indemnity is not part of the penalty for the crime
A waiver of any of the civil actions extinguishes the others. committed." The only issue brought before the trial court in the
The institution of, or the reservation of the right to file, any of criminal action is whether accused Romeo Dunca y de Tumol is guilty
said civil actions separately waives the others. of reckless imprudence resulting in homicide and damage to property.
The action for recovery of civil liability is not included therein, but is
The rationale behind this rule is the avoidance of multiple suits covered by the separate civil action filed against the petitioner as
between the same litigants arising out of the same act or omission of employer of the accused truck-driver.
the offender. The restrictive phraseology of the section under
consideration is meant to cover all kinds of civil actions, regardless of In this case, accused-driver jumped bail pending his appeal from his
their source in law, provided that the action has for its basis the same conviction. Thus, the judgment convicting the accused became final
act or omission of the offender. 29 and executory, but only insofar as the penalty in the criminal action is
concerned. The damages awarded in the criminal action was invalid
However, petitioner as defendant in the separate civil action for because of its effective waiver. The pronouncement was void because
damages filed against it, based on quasi delict, may be held liable the action for recovery of the civil liability arising from the crime has
thereon. Thus, the trial court grievously erred in dismissing plaintiff's been waived in said criminal action.
civil complaint. And the Court of Appeals erred in affirming the trial
court's decision. Unfortunately private respondents did not appeal With respect to the issue that the award of damages in the criminal
from such dismissal and could not be granted affirmative relief. 30 action exceeded the amount of damages alleged in the amended
information, the issue is de minimis. At any rate, the trial court erred
The Court, however, in exceptional cases has relaxed the rules "in in awarding damages in the criminal case because by virtue of the
order to promote their objectives and assist the parties in obtaining reservation of the right to bring a separate civil action or the filing
just, speedy, and inexpensive determination of every action or thereof, "there would be no possibility that the employer would be
proceeding" 31 or exempted "a particular case from the operation of the held liable because in such a case there would be no pronouncement
rules." 32 as to the civil liability of the accused. 35

Invoking this principle, we rule that the trial court erred in awarding As a final note, we reiterate that "the policy against double recovery
civil damages in the criminal case and in dismissing the civil action. requires that only one action be maintained for the same act or
Apparently satisfied with such award, private respondent did not omission whether the action is brought against the employee or against
appeal from the dismissal of the civil case. However, petitioner did his employer. 36 The injured party must choose which of the available
appeal. Hence, this case should be remanded to the trial court so that causes of action for damages he will bring. 37
it may render decision in the civil case awarding damages as may be
warranted by the evidence. 33
Parenthetically, the trial court found the accused "guilty beyond Case No. Br. 19-311 and Civil Case No. Br. 19-424, dated June 6,
reasonable doubt of the crime of Double Homicide Through Reckless 1992.
Imprudence with violation of the Motor Vehicle Law (Rep. Act No.
4136)". There is no such nomenclature of an offense under the Revised IN LIEU THEREOF, the Court renders judgment as follows:
Penal Code. Thus, the trial court was misled to sentence the accused
"to suffer two (2) indeterminate penalties of four (4) months and one (1) In Criminal Case No. Br. 19-311, the Court declares the
(1) day of arresto mayor, as minimum, to three (3) years, six (6) accused Romeo Dunca y de Tumol guilty beyond reasonable
months and twenty (20) days of prision correccional, as maximum." doubt of reckless imprudence resulting in homicide and
This is erroneous because in reckless imprudence cases, the actual damage to property, defined and penalized under Article 365,
penalty for criminal negligence bears no relation to the individual paragraph 2 of the Revised Penal Code, with violation of the
willfull crime or crimes committed, but is set in relation to a whole automobile law (R.A. No. 4136, as amended), and sentences
class, or series of crimes. 38 him to suffer two (2) indeterminate penalties of four (4)
months and one (1) day of arresto mayor, as minimum, to
Unfortunately, we can no longer correct this judgment even if three (3) years, six (6) months and twenty (20) days of prision
erroneous, as it is, because it has become final and executory. correccional, as maximum, 40 without indemnity, and to pay
the costs, and
Under Article 365 of the Revised Penal Code, criminal negligence "is
treated as a mere quasi offense, and dealt with separately from willful (2) In Civil Case No. Br. 19-424, the Court orders the case re-
offenses. It is not a question of classification or terminology. In opened to determine the liability of the defendant Rafael
intentional crimes, the act itself is punished; in negligence or Reyes Trucking Corporation to plaintiffs and that of plaintiffs
imprudence, what is principally penalized is the mental attitude or on defendant's counterclaim.
condition behind the act, the dangerous recklessness, lack of care or
foresight, the imprudencia punible. Much of the confusion has arisen No costs in this instance.
from the common use of such descriptive phrase as "homicide through
reckless imprudence", and the like; when the strict technical sense is, SO ORDERED.
more accurately, "reckless imprudence resulting in homicide"; or
"simple imprudence causing damages to property"." 39

There is need, therefore, to rectify the designation of the offense

without disturbing the imposed penalty for the guidance of bench and
bar in strict adherence to precedent.

WHEREFORE, the Court GRANTS the petition and SETS ASIDE the
amended decision and resolution of the Court of Appeals in CA-G.R.
CR No. 14448, promulgated on January 6, 1997, and the joint decision
of the Regional Trial Court, Isabela, Branch 19, Cauayan, in Criminal
G.R. No. 190696 August 3, 2010 Calbayog City. The RTC, in its decision dated May 21, 2001, found
Calang guilty beyond reasonable doubt of reckless imprudence
ROLITO CALANG and PHILTRANCO SERVICE resulting to multiple homicide, multiple physical injuries and damage
ENTERPRISES, INC., Petitioners, to property, and sentenced him to suffer an indeterminate penalty of
vs. thirty days of arresto menor, as minimum, to four years and two
PEOPLE OF THE PHILIPPINES, Respondent. months of prision correccional, as maximum. The RTC ordered
Calang and Philtranco, jointly and severally, to pay ₱50,000.00 as
RESOLUTION death indemnity to the heirs of Armando; ₱50,000.00 as death
indemnity to the heirs of Mabansag; and ₱90,083.93 as actual damages
BRION, J.: to the private complainants.

We resolve the motion for reconsideration filed by the petitioners, The petitioners appealed the RTC decision to the Court of Appeals
Philtranco Service Enterprises, Inc. (Philtranco) and Rolito Calang, to (CA), docketed as CA-G.R. CR No. 25522. The CA, in its decision
challenge our Resolution of February 17, 2010. Our assailed dated November 20, 2009, affirmed the RTC decision in toto. The CA
Resolution denied the petition for review on certiorari for failure to ruled that petitioner Calang failed to exercise due care and precaution
show any reversible error sufficient to warrant the exercise of this in driving the Philtranco bus. According to the CA, various
Court’s discretionary appellate jurisdiction. eyewitnesses testified that the bus was traveling fast and encroached
into the opposite lane when it evaded a pushcart that was on the side
of the road. In addition, he failed to slacken his speed, despite
Antecedent Facts
admitting that he had already seen the jeep coming from the opposite
direction when it was still half a kilometer away. The CA further ruled
At around 2:00 p.m. of April 22, 1989, Rolito Calang was driving
that Calang demonstrated a reckless attitude when he drove the bus,
Philtranco Bus No. 7001, owned by Philtranco along Daang Maharlika
despite knowing that it was suffering from loose compression, hence,
Highway in Barangay Lambao, Sta. Margarita, Samar when its rear
not roadworthy.
left side hit the front left portion of a Sarao jeep coming from the
opposite direction. As a result of the collision, Cresencio
Pinohermoso, the jeep’s driver, lost control of the vehicle, and bumped The CA added that the RTC correctly held Philtranco jointly and
and killed Jose Mabansag, a bystander who was standing along the severally liable with petitioner Calang, for failing to prove that it had
exercised the diligence of a good father of the family to prevent the
highway’s shoulder. The jeep turned turtle three (3) times before
finally stopping at about 25 meters from the point of impact. Two of accident.
the jeep’s passengers, Armando Nablo and an unidentified woman,
were instantly killed, while the other passengers sustained serious The petitioners filed with this Court a petition for review on certiorari.
physical injuries. In our Resolution dated February 17, 2010, we denied the petition for
failure to sufficiently show any reversible error in the assailed decision
The prosecution charged Calang with multiple homicide, multiple to warrant the exercise of this Court’s discretionary appellate
serious physical injuries and damage to property thru reckless jurisdiction.
imprudence before the Regional Trial Court (RTC), Branch 31,
The Motion for Reconsideration Philtranco was not a direct party in this case. Since the cause of action
against Calang was based on delict, both the RTC and the CA erred in
In the present motion for reconsideration, the petitioners claim that holding Philtranco jointly and severally liable with Calang, based on
there was no basis to hold Philtranco jointly and severally liable with quasi-delict under Articles 21761 and 21802 of the Civil Code. Articles
Calang because the former was not a party in the criminal case (for 2176 and 2180 of the Civil Code pertain to the vicarious liability of an
multiple homicide with multiple serious physical injuries and damage employer for quasi-delicts that an employee has committed. Such
to property thru reckless imprudence) before the RTC. provision of law does not apply to civil liability arising from delict.

The petitioners likewise maintain that the courts below overlooked If at all, Philtranco’s liability may only be subsidiary. Article 102 of
several relevant facts, supported by documentary exhibits, which, if the Revised Penal Code states the subsidiary civil liabilities of
considered, would have shown that Calang was not negligent, such as innkeepers, tavern keepers and proprietors of establishments, as
the affidavit and testimony of witness Celestina Cabriga; the follows:
testimony of witness Rodrigo Bocaycay; the traffic accident sketch
and report; and the jeepney’s registration receipt. The petitioners also In default of the persons criminally liable, innkeepers, tavern keepers,
insist that the jeep’s driver had the last clear chance to avoid the and any other persons or corporations shall be civilly liable for crimes
collision. committed in their establishments, in all cases where a violation of
municipal ordinances or some general or special police regulations
We partly grant the motion. shall have been committed by them or their employees.

Liability of Calang Innkeepers are also subsidiary liable for the restitution of goods taken
by robbery or theft within their houses from guests lodging therein, or
We see no reason to overturn the lower courts’ finding on Calang’s for the payment of the value thereof, provided that such guests shall
culpability. The finding of negligence on his part by the trial court, have notified in advance the innkeeper himself, or the person
affirmed by the CA, is a question of fact that we cannot pass upon representing him, of the deposit of such goods within the inn; and shall
without going into factual matters touching on the finding of furthermore have followed the directions which such innkeeper or his
negligence. In petitions for review on certiorari under Rule 45 of the representative may have given them with respect to the care of and
Revised Rules of Court, this Court is limited to reviewing only errors vigilance over such goods. No liability shall attach in case of robbery
of law, not of fact, unless the factual findings complained of are devoid with violence against or intimidation of persons unless committed by
of support by the evidence on record, or the assailed judgment is based the innkeeper’s employees.
on a misapprehension of facts.
The foregoing subsidiary liability applies to employers, according to
Liability of Philtranco Article 103 of the Revised Penal Code, which reads:

We, however, hold that the RTC and the CA both erred in holding The subsidiary liability established in the next preceding article shall
Philtranco jointly and severally liable with Calang. We emphasize that also apply to employers, teachers, persons, and corporations engaged
Calang was charged criminally before the RTC. Undisputedly, in any kind of industry for felonies committed by their servants,
pupils, workmen, apprentices, or employees in the discharge of their
duties.

The provisions of the Revised Penal Code on subsidiary liability –

Articles 102 and 103 – are deemed written into the judgments in cases
to which they are applicable. Thus, in the dispositive portion of its
decision, the trial court need not expressly pronounce the subsidiary
liability of the employer.3 Nonetheless, before the employers’
subsidiary liability is enforced, adequate evidence must exist
establishing that (1) they are indeed the employers of the convicted
employees; (2) they are engaged in some kind of industry; (3) the
crime was committed by the employees in the discharge of their
duties; and (4) the execution against the latter has not been satisfied
due to insolvency. The determination of these conditions may be done
in the same criminal action in which the employee’s liability, criminal
and civil, has been pronounced, in a hearing set for that precise
purpose, with due notice to the employer, as part of the proceedings
for the execution of the judgment.4

WHEREFORE, we PARTLY GRANT the present motion. The Court

of Appeals decision that affirmed in toto the RTC decision, finding
Rolito Calang guilty beyond reasonable doubt of reckless imprudence
resulting in multiple homicide, multiple serious physical injuries and
damage to property, is AFFIRMED, with the MODIFICATION that
Philtranco’s liability should only be subsidiary. No costs.

SO ORDERED.
G.R. No. 129282 November 29, 2001 complaint failed to contain a certification against forum shopping as
required by Supreme Court Circular No. 28-91.4
DMPI EMPLOYEES CREDIT COOPERATIVE, INC., (DMPI-
ECCI), petitioner, On December 12, 1996, the trial court issued an order 5 dismissing
vs. Civil Case No. CV-94-214. On January 21, 1997, respondent filed a
HON. ALEJANDRO M. VELEZ, as Presiding Judge of the RTC, motion for reconsideration6 of the order.
Misamis Oriental, Br. 20, and ERIBERTA
VILLEGAS, respondents. On February 21, 1997, the trial court issued an order 7 granting
respondent's motion for reconsideration, thereby recalling the
PARDO, J.: dismissal of the case.

The Case Hence, this petition.8

In this special civil action for certiorari, petitioner DMPI Employees The Issues
Credit Cooperative, Inc. (DMPI-ECCI) seeks the annulment of the
order1 of the Regional Trial Court, Misamis Oriental, Branch 20, The issues raised are: (1) whether the plaintiff's failure to attach a
granting the motion for reconsideration of respondent Eriberta certification against forum shopping in the complaint is a ground to
Villegas, and thus reversing the previous dismissal of Civil Case No. dismiss the case;9 and, (2) whether the civil case could proceed
CV-94-214. independently of the criminal case for estafa without having reserved
the filing of the civil action.
The Facts
The Court's Ruling
On February 18, 1994, the prosecuting attorney filed with the Regional
Trial Court, Misamis Oriental, Branch 37, an information for On the first issue, Circular No. 28-9110 of the Supreme Court requires
estafa2 against Carmen Mandawe for alleged failure to account to a certificate of non-forum shopping to be attached to petitions filed
respondent Eriberta Villegas the amount of P608,532.46. Respondent before the Supreme Court and the Court of Appeals. This circular was
Villegas entrusted this amount to Carmen Mandawe, an employee of revised on February 8, 199411 by extending the requirement to all
petitioner DMPI-ECCI, for deposit with the teller of petitioner. initiatory pleadings filed in all courts and quasi-judicial agencies other
than the Supreme Court and the Court of Appeals.
Subsequently, on March 29, 1994, respondent Eriberta Villegas filed
with the Regional Trial Court, Misamis Oriental, Branch 20, a Respondent Villegas' failure to attach a certificate of non-forum
complaint3 against Carmen Mandawe and petitioner DMPI-ECCI for shopping in her complaint did not violate Circular No. 28-91, because
a sum of money and damages with preliminary attachment arising out at the time of filing, the requirement applied only to petitions filed
of the same transaction. In time, petitioner sought the dismissal of the with the Supreme Court and the Court of Appeals. 12 Likewise,
civil case on the following grounds: (1) that there is a pending criminal Administrative Circular No. 04-94 is inapplicable for the reason that
case in RTC Branch 37, arising from the same facts, and (2) that the
the complaint was filed on March 29, 1994, three days before April 1, judgment has been entered in the criminal action." [Emphasis
1994, the date of effectivity of the circular.13 supplied]

On the second issue, as a general rule, an offense causes two (2) However, with respect to civil actions for recovery of civil liability
classes of injuries. The first is the social injury produced by the under Articles 32, 33, 34 and 2176 of the Civil Code arising from the
criminal act which is sought to be repaired thru the imposition of the same act or omission, the rule has been changed.
corresponding penalty, and the second is the personal injury caused to
the victim of the crime which injury is sought to be compensated Under the present rule, only the civil liability arising from the offense
through indemnity which is civil in nature. 14 charged is deemed instituted with the criminal action unless the
offended party waives the civil action, reserves his right to institute it
Thus, "every person criminally liable for a felony is also civilly separately, or institutes the civil action prior to the criminal action. 17
liable."15 This is the law governing the recovery of civil liability
arising from the commission of an offense. Civil liability includes There is no more need for a reservation of the right to file the
restitution, reparation for damage caused, and indemnification of independent civil actions under Articles 32, 33, 34 and 2176 of the
consequential damages.16 Civil Code of the Philippines. "The reservation and waiver referred to
refers only to the civil action for the recovery of the civil liability
The offended party may prove the civil liability of an accused arising arising from the offense charged. This does not include recovery of
from the commission of the offense in the criminal case since the civil civil liability under Articles 32, 33, 34 and 2176 of the Civil Code of
action is either deemed instituted with the criminal action or is the Philippines arising from the same act or omission which may be
separately instituted. prosecuted separately even without a reservation."18

Rule 111, Section 1 of the Revised Rules of Criminal Procedure, Rule 111, Section 3 reads:
which became effective on December 1, 2000, provides that:
"Sec. 3. When civil action may proceed independently. — In
"(a) When a criminal action is instituted, the civil action for the cases provided in Articles 32, 33, 34 and 2176 of the Civil
the recovery of civil liability arising from the offense charged Code of the Philippines, the independent civil action may be
shall be deemed instituted with the criminal action unless the brought by the offended party. It shall proceed independently
offended party waives the civil action, reserves the right to of the criminal action and shall require only a preponderance
institute it separately or institutes the civil action prior to the of evidence. In no case, however, may the offended party
criminal action." [Emphasis supplied] recover damages twice for the same act or omission charged
in the criminal action."
Rule 111, Section 2 further provides that —
The changes in the Revised Rules on Criminal Procedure pertaining
"After the criminal action has been commenced, the separate to independent civil actions which became effective on December 1,
civil action arising therefrom cannot be instituted until final 2000 are applicable to this case.
Procedural laws may be given retroactive effect to actions pending and
undetermined at the time of their passage. There are no vested rights
in the rules of procedure.19

Thus, Civil Case No. CV-94-214, an independent civil action for

damages on account of the fraud committed against respondent
Villegas under Article 33 of the Civil Code, may proceed
independently even if there was no reservation as to its filing.

The Fallo

WHEREFORE, the Court DENIES the petition. The Court AFFIRMS

the order dated February 21, 1997.20

No costs.

SO ORDERED.
G.R. No. 145391 August 26, 2002 On Motion for Reconsideration, Casupanan and Capitulo insisted that
the civil case is a separate civil action which can proceed
AVELINO CASUPANAN and ROBERTO independently of the criminal case. The MCTC denied the motion for
CAPITULO, petitioners, reconsideration in the Order of May 7, 1999. Casupanan and Capitulo
vs. filed a petition for certiorari under Rule 65 before the Regional Trial
MARIO LLAVORE LAROYA, respondent. Court ("Capas RTC" for brevity) of Capas, Tarlac, Branch
66,3 assailing the MCTC’s Order of dismissal.
CARPIO, J.:
The Trial Court’s Ruling
The Case
The Capas RTC rendered judgment on December 28, 1999 dismissing
This is a petition for review on certiorari to set aside the the petition for certiorari for lack of merit. The Capas RTC ruled that
Resolution1 dated December 28, 1999 dismissing the petition for the order of dismissal issued by the MCTC is a final order which
certiorari and the Resolution2 dated August 24, 2000 denying the disposes of the case and therefore the proper remedy should have been
motion for reconsideration, both issued by the Regional Trial Court of an appeal. The Capas RTC further held that a special civil action for
Capas, Tarlac, Branch 66, in Special Civil Action No. 17-C (99). certiorari is not a substitute for a lost appeal. Finally, the Capas RTC
declared that even on the premise that the MCTC erred in dismissing
The Facts the civil case, such error is a pure error of judgment and not an abuse
of discretion.
Two vehicles, one driven by respondent Mario Llavore Laroya
("Laroya" for brevity) and the other owned by petitioner Roberto Casupanan and Capitulo filed a Motion for Reconsideration but the
Capitulo ("Capitulo" for brevity) and driven by petitioner Avelino Capas RTC denied the same in the Resolution of August 24, 2000.
Casupanan ("Casupanan" for brevity), figured in an accident. As a
result, two cases were filed with the Municipal Circuit Trial Court Hence, this petition.
("MCTC" for brevity) of Capas, Tarlac. Laroya filed a criminal case
against Casupanan for reckless imprudence resulting in damage to The Issue
property, docketed as Criminal Case No. 002-99. On the other hand,
Casupanan and Capitulo filed a civil case against Laroya for quasi- The petition premises the legal issue in this wise:
delict, docketed as Civil Case No. 2089.
"In a certain vehicular accident involving two parties, each
When the civil case was filed, the criminal case was then at its one of them may think and believe that the accident was
preliminary investigation stage. Laroya, defendant in the civil case, caused by the fault of the other. x x x [T]he first party,
filed a motion to dismiss the civil case on the ground of forum- believing himself to be the aggrieved party, opted to file a
shopping considering the pendency of the criminal case. The MCTC criminal case for reckless imprudence against the second
granted the motion in the Order of March 26, 1999 and dismissed the party. On the other hand, the second party, together with his
civil case. operator, believing themselves to be the real aggrieved
 parties, opted in turn to file a civil case for quasi-delict against only one action - the independent civil action for quasi-delict against
the first party who is the very private complainant in the Laroya.
criminal case."4
Nature of the Order of Dismissal
Thus, the issue raised is whether an accused in a pending criminal case
for reckless imprudence can validly file, simultaneously and The MCTC dismissed the civil action for quasi-delict on the ground
independently, a separate civil action for quasi-delict against the of forum-shopping under Supreme Court Administrative Circular No.
private complainant in the criminal case. 04-94. The MCTC did not state in its order of dismissal5 that the
dismissal was with prejudice. Under the Administrative Circular, the
The Court’s Ruling order of dismissal is without prejudice to refiling the complaint, unless
the order of dismissal expressly states it is with prejudice.6 Absent a
Casupanan and Capitulo assert that Civil Case No. 2089, which the declaration that the dismissal is with prejudice, the same is deemed
MCTC dismissed on the ground of forum-shopping, constitutes a without prejudice. Thus, the MCTC’s dismissal, being silent on the
counterclaim in the criminal case. Casupanan and Capitulo argue that matter, is a dismissal without prejudice.
if the accused in a criminal case has a counterclaim against the private
complainant, he may file the counterclaim in a separate civil action at Section 1 of Rule 417 provides that an order dismissing an action
the proper time. They contend that an action on quasi-delict is different without prejudice is not appealable. The remedy of the aggrieved party
from an action resulting from the crime of reckless imprudence, and is to file a special civil action under Rule 65. Section 1 of Rule 41
an accused in a criminal case can be an aggrieved party in a civil case expressly states that "where the judgment or final order is not
arising from the same incident. They maintain that under Articles 31 appealable, the aggrieved party may file an appropriate special civil
and 2176 of the Civil Code, the civil case can proceed independently action under Rule 65." Clearly, the Capas RTC’s order dismissing the
of the criminal action. Finally, they point out that Casupanan was not petition for certiorari, on the ground that the proper remedy is an
the only one who filed the independent civil action based on quasi- ordinary appeal, is erroneous.
delict but also Capitulo, the owner-operator of the vehicle, who was
not a party in the criminal case. Forum-Shopping

In his Comment, Laroya claims that the petition is fatally defective as The essence of forum-shopping is the filing of multiple suits involving
it does not state the real antecedents. Laroya further alleges that the same parties for the same cause of action, either simultaneously or
Casupanan and Capitulo forfeited their right to question the order of successively, to secure a favorable judgment. 8 Forum-shopping is
dismissal when they failed to avail of the proper remedy of appeal. present when in the two or more cases pending, there is identity of
Laroya argues that there is no question of law to be resolved as the parties, rights of action and reliefs sought.9 However, there is no
order of dismissal is already final and a petition for certiorari is not a forum-shopping in the instant case because the law and the rules
substitute for a lapsed appeal. expressly allow the filing of a separate civil action which can proceed
independently of the criminal action.
In their Reply, Casupanan and Capitulo contend that the petition raises
the legal question of whether there is forum-shopping since they filed
Laroya filed the criminal case for reckless imprudence resulting in No counterclaim, cross-claim or third-party complaint may be
damage to property based on the Revised Penal Code while Casupanan filed by the accused in the criminal case, but any cause of
and Capitulo filed the civil action for damages based on Article 2176 action which could have been the subject thereof may be
of the Civil Code. Although these two actions arose from the same act litigated in a separate civil action." (Emphasis supplied)
or omission, they have different causes of action. The criminal case is
based on culpa criminal punishable under the Revised Penal Code Since the present Rules require the accused in a criminal action to file
while the civil case is based on culpa aquiliana actionable under his counterclaim in a separate civil action, there can be no forum-
Articles 2176 and 2177 of the Civil Code. These articles on culpa shopping if the accused files such separate civil action.
aquiliana read:
Filing of a separate civil action
"Art. 2176. Whoever by act or omission causes damage to
another, there being fault or negligence, is obliged to pay for Section 1, Rule 111 of the 1985 Rules on Criminal Procedure ("1985
the damage done. Such fault or negligence, if there is no pre- Rules" for brevity), as amended in 1988, allowed the filing of a
existing contractual relation between the parties, is called a separate civil action independently of the criminal action provided the
quasi-delict and is governed by the provisions of this Chapter. offended party reserved the right to file such civil action. Unless the
offended party reserved the civil action before the presentation of the
Art. 2177. Responsibility for fault or negligence under the evidence for the prosecution, all civil actions arising from the same
preceding article is entirely separate and distinct from the civil act or omission were deemed "impliedly instituted" in the criminal
liability arising from negligence under the Penal Code. But case. These civil actions referred to the recovery of civil liability ex-
the plaintiff cannot recover damages twice for the same act or delicto, the recovery of damages for quasi-delict, and the recovery of
omission of the defendant." damages for violation of Articles 32, 33 and 34 of the Civil Code on
Human Relations.
Any aggrieved person can invoke these articles provided he proves,
by preponderance of evidence, that he has suffered damage because of Thus, to file a separate and independent civil action for quasi-delict
the fault or negligence of another. Either the private complainant or under the 1985 Rules, the offended party had to reserve in the criminal
the accused can file a separate civil action under these articles. There action the right to bring such action. Otherwise, such civil action was
is nothing in the law or rules that state only the private complainant in deemed "impliedly instituted" in the criminal action. Section 1, Rule
a criminal case may invoke these articles. 111 of the 1985 Rules provided as follows:

Moreover, paragraph 6, Section 1, Rule 111 of the 2000 Rules on "Section 1. – Institution of criminal and civil actions. – When
Criminal Procedure ("2000 Rules" for brevity) expressly requires the a criminal action is instituted, the civil action for the recovery
accused to litigate his counterclaim in a separate civil action, to wit: of civil liability is impliedly instituted with the criminal
action, unless the offended party waives the action, reserves
"SECTION 1. Institution of criminal and civil actions. – (a) x his right to institute it separately, or institutes the civil action
x x. prior to the criminal action.
 Such civil action includes recovery of indemnity under the (b) x x x
Revised Penal Code, and damages under Articles 32, 33, 34
and 2176 of the Civil Code of the Philippines arising from Where the civil action has been filed separately and trial
the same act or omission of the accused. thereof has not yet commenced, it may be consolidated with
the criminal action upon application with the court trying the
A waiver of any of the civil actions extinguishes the others. latter case. If the application is granted, the trial of both
The institution of, or the reservation of the right to file, any of actions shall proceed in accordance with section 2 of this rule
said civil actions separately waives the others. governing consolidation of the civil and criminal actions."
(Emphasis supplied)
The reservation of the right to institute the separate civil
actions shall be made before the prosecution starts to present Under Section 1 of the present Rule 111, what is "deemed instituted"
its evidence and under circumstances affording the offended with the criminal action is only the action to recover civil liability
party a reasonable opportunity to make such reservation. arising from the crime or ex-delicto. All the other civil actions under
Articles 32, 33, 34 and 2176 of the Civil Code are no longer "deemed
In no case may the offended party recover damages twice for instituted," and may be filed separately and prosecuted independently
the same act or omission of the accused. even without any reservation in the criminal action. The failure to
make a reservation in the criminal action is not a waiver of the right to
x x x." (Emphasis supplied) file a separate and independent civil action based on these articles of
the Civil Code. The prescriptive period on the civil actions based on
Section 1, Rule 111 of the 1985 Rules was amended on December 1, these articles of the Civil Code continues to run even with the filing of
2000 and now provides as follows: the criminal action. Verily, the civil actions based on these articles of
the Civil Code are separate, distinct and independent of the civil action
"SECTION 1. Institution of criminal and civil actions. – (a) "deemed instituted" in the criminal action.10
When a criminal action is instituted, the civil action for the
recovery of civil liability arising from the offense charged Under the present Rule 111, the offended party is still given the option
shall be deemed instituted with the criminal action unless the to file a separate civil action to recover civil liability ex-delicto by
offended party waives the civil action, reserves the right to reserving such right in the criminal action before the prosecution
institute it separately or institutes the civil action prior to the presents its evidence. Also, the offended party is deemed to make such
criminal action. reservation if he files a separate civil action before filing the criminal
action. If the civil action to recover civil liability ex-delicto is filed
The reservation of the right to institute separately the civil separately but its trial has not yet commenced, the civil action may be
action shall be made before the prosecution starts presenting consolidated with the criminal action. The consolidation under this
its evidence and under circumstances affording the offended Rule does not apply to separate civil actions arising from the same act
or omission filed under Articles 32, 33, 34 and 2176 of the Civil
party a reasonable opportunity to make such reservation.
Code. 11
xxx
Suspension of the Separate Civil Action present additional evidence. The consolidated criminal and
civil actions shall be tried and decided jointly.
Under Section 2, Rule 111 of the amended 1985 Rules, a separate civil
action, if reserved in the criminal action, could not be filed until after During the pendency of the criminal action, the running of the
final judgment was rendered in the criminal action. If the separate civil period of prescription of the civil action which cannot be
action was filed before the commencement of the criminal action, the instituted separately or whose proceeding has been suspended
civil action, if still pending, was suspended upon the filing of the shall be tolled.
criminal action until final judgment was rendered in the criminal
action. This rule applied only to the separate civil action filed to x x x." (Emphasis supplied)
recover liability ex-delicto. The rule did not apply to independent civil
actions based on Articles 32, 33, 34 and 2176 of the Civil Code, which Thus, Section 2, Rule 111 of the present Rules did not change the rule
could proceed independently regardless of the filing of the criminal that the separate civil action, filed to recover damages ex-delicto, is
action. suspended upon the filing of the criminal action. Section 2 of the
present Rule 111 also prohibits the filing, after commencement of the
The amended provision of Section 2, Rule 111 of the 2000 Rules criminal action, of a separate civil action to recover damages ex-
continues this procedure, to wit: delicto.

"SEC. 2. When separate civil action is suspended. – After the When civil action may proceed independently
criminal action has been commenced, the separate civil action
arising therefrom cannot be instituted until final judgment has The crucial question now is whether Casupanan and Capitulo, who are
been entered in the criminal action. not the offended parties in the criminal case, can file a separate civil
action against the offended party in the criminal case. Section 3, Rule
If the criminal action is filed after the said civil action has 111 of the 2000 Rules provides as follows:
already been instituted, the latter shall be suspended in
whatever stage it may be found before judgment on the "SEC 3. When civil action may proceed independently. - In
merits. The suspension shall last until final judgment is the cases provided in Articles 32, 33, 34 and 2176 of the Civil
rendered in the criminal action. Nevertheless, before Code of the Philippines, the independent civil action may be
judgment on the merits is rendered in the civil action, the same brought by the offended party. It shall proceed independently
may, upon motion of the offended party, be consolidated with of the criminal action and shall require only a preponderance
the criminal action in the court trying the criminal action. In of evidence. In no case, however, may the offended party
case of consolidation, the evidence already adduced in the recover damages twice for the same act or omission charged
civil action shall be deemed automatically reproduced in the in the criminal action." (Emphasis supplied)
criminal action without prejudice to the right of the
prosecution to cross-examine the witnesses presented by the Section 3 of the present Rule 111, like its counterpart in the amended
offended party in the criminal case and of the parties to 1985 Rules, expressly allows the "offended party" to bring an
independent civil action under Articles 32, 33, 34 and 2176 of the Civil
Code. As stated in Section 3 of the present Rule 111, this civil action been the subject (of the counterclaim, cross-claim or third-party
shall proceed independently of the criminal action and shall require complaint) may be litigated in a separate civil action." The present
only a preponderance of evidence. In no case, however, may the Rule 111 mandates the accused to file his counterclaim in a separate
"offended party recover damages twice for the same act or omission civil actiosn which shall proceed independently of the criminal action,
charged in the criminal action." even as the civil action of the offended party is litigated in the criminal
action.
There is no question that the offended party in the criminal action can
file an independent civil action for quasi-delict against the accused. Conclusion
Section 3 of the present Rule 111 expressly states that the "offended
party" may bring such an action but the "offended party" may not Under Section 1 of the present Rule 111, the independent civil action
recover damages twice for the same act or omission charged in the in Articles 32, 33, 34 and 2176 of the Civil Code is not deemed
criminal action. Clearly, Section 3 of Rule 111 refers to the offended instituted with the criminal action but may be filed separately by the
party in the criminal action, not to the accused. offended party even without reservation. The commencement of the
criminal action does not suspend the prosecution of the independent
Casupanan and Capitulo, however, invoke the ruling in Cabaero vs. civil action under these articles of the Civil Code. The suspension in
Cantos12 where the Court held that the accused therein could validly Section 2 of the present Rule 111 refers only to the civil action arising
institute a separate civil action for quasi-delict against the private from the crime, if such civil action is reserved or filed before the
complainant in the criminal case. In Cabaero, the accused in the commencement of the criminal action.
criminal case filed his Answer with Counterclaim for malicious
prosecution. At that time the Court noted the "absence of clear-cut Thus, the offended party can file two separate suits for the same act or
rules governing the prosecution on impliedly instituted civil actions omission. The first a criminal case where the civil action to recover
and the necessary consequences and implications thereof." Thus, civil liability ex-delicto is deemed instituted, and the other a civil case
the Court ruled that the trial court should confine itself to the criminal for quasi-delict - without violating the rule on non-forum shopping.
aspect of the case and disregard any counterclaim for civil liability. The two cases can proceed simultaneously and independently of each
The Court further ruled that the accused may file a separate civil case other. The commencement or prosecution of the criminal action will
against the offended party "after the criminal case is terminated and/or not suspend the civil action for quasi-delict. The only limitation is that
in accordance with the new Rules which may be promulgated." The the offended party cannot recover damages twice for the same act or
Court explained that a cross-claim, counterclaim or third-party omission of the defendant. In most cases, the offended party will have
complaint on the civil aspect will only unnecessarily complicate the no reason to file a second civil action since he cannot recover damages
proceedings and delay the resolution of the criminal case. twice for the same act or omission of the accused. In some instances,
the accused may be insolvent, necessitating the filing of another case
Paragraph 6, Section 1 of the present Rule 111 was incorporated in the against his employer or guardians.
2000 Rules precisely to address the lacuna mentioned in Cabaero.
Under this provision, the accused is barred from filing a counterclaim, Similarly, the accused can file a civil action for quasi-delict for the
cross-claim or third-party complaint in the criminal case. However, same act or omission he is accused of in the criminal case. This is
the same provision states that "any cause of action which could have expressly allowed in paragraph 6, Section 1 of the present Rule 111
which states that the counterclaim of the accused "may be litigated in meaningless the independent character of the civil action and
a separate civil action." This is only fair for two reasons. First, the the clear injunction in Article 31 that this action 'may proceed
accused is prohibited from setting up any counterclaim in the civil independently of the criminal proceedings and regardless of
aspect that is deemed instituted in the criminal case. The accused is the result of the latter.’"
therefore forced to litigate separately his counterclaim against the
offended party. If the accused does not file a separate civil action More than half a century has passed since the Civil Code introduced
for quasi-delict, the prescriptive period may set in since the period the concept of a civil action separate and independent from the
continues to run until the civil action for quasi-delict is filed. criminal action although arising from the same act or omission. The
Court, however, has yet to encounter a case of conflicting and
Second, the accused, who is presumed innocent, has a right to invoke irreconcilable decisions of trial courts, one hearing the criminal case
Article 2177 of the Civil Code, in the same way that the offended party and the other the civil action for quasi-delict. The fear of conflicting
can avail of this remedy which is independent of the criminal action. and irreconcilable decisions may be more apparent than real. In any
To disallow the accused from filing a separate civil action for quasi- event, there are sufficient remedies under the Rules of Court to deal
delict, while refusing to recognize his counterclaim in the criminal with such remote possibilities.
case, is to deny him due process of law, access to the courts, and equal
protection of the law. One final point. The Revised Rules on Criminal Procedure took effect
on December 1, 2000 while the MCTC issued the order of dismissal
Thus, the civil action based on quasi-delict filed separately by on December 28, 1999 or before the amendment of the rules. The
Casupanan and Capitulo is proper. The order of dismissal by the Revised Rules on Criminal Procedure must be given retroactive effect
MCTC of Civil Case No. 2089 on the ground of forum-shopping is considering the well-settled rule that -
erroneous.
"x x x statutes regulating the procedure of the court will be
We make this ruling aware of the possibility that the decision of the construed as applicable to actions pending and undetermined
trial court in the criminal case may vary with the decision of the trial at the time of their passage. Procedural laws are retroactive in
court in the independent civil action. This possibility has always been that sense and to that extent."14
recognized ever since the Civil Code introduced in 1950 the concept
of an independent civil action under Articles 32, 33, 34 and 2176 of WHEREFORE, the petition for review on certiorari is
the Code. But the law itself, in Article 31 of the Code, expressly hereby GRANTED. The Resolutions dated December 28, 1999 and
provides that the independent civil action "may proceed independently August 24, 2000 in Special Civil Action No. 17-C (99)
of the criminal proceedings and regardless of the result of the latter." are ANNULLED and Civil Case No. 2089 is REINSTATED.
In Azucena vs. Potenciano,13 the Court declared:
SO ORDERED.
"x x x. There can indeed be no other logical conclusion than
this, for to subordinate the civil action contemplated in the
said articles to the result of the criminal prosecution —
whether it be conviction or acquittal — would render
G.R. No. 141538 March 23, 2004 bus line, her husband Attorney Juan Cerezo ("Atty. Cerezo"), and bus
driver Danilo A. Foronda ("Foronda"). The complaint alleged that:
HERMANA R. CEREZO, petitioner,
vs. 7. At the time of the incident, plaintiff [Tuazon] was in his
DAVID TUAZON, respondent. proper lane when the second-named defendant [Foronda],
being then the driver and person in charge of the Country Bus
with plate number NYA 241, did then and there willfully,
unlawfully, and feloniously operate the said motor vehicle in
a negligent, careless, and imprudent manner without due
DECISION regard to traffic rules and regulations, there being a "Slow
Down" sign near the scene of the incident, and without taking
the necessary precaution to prevent loss of lives or injuries,
his negligence, carelessness and imprudence resulted to
severe damage to the tricycle and serious physical injuries to
plaintiff thus making him unable to walk and becoming
CARPIO, J.:
disabled, with his thumb and middle finger on the left hand
being cut[.]4
The Case
On 1 October 1993, Tuazon filed a motion to litigate as a pauper.
This is a petition for review on certiorari1 to annul the
Subsequently, the trial court issued summons against Atty. Cerezo and
Resolution2 dated 21 October 1999 of the Court of Appeals in CA-
Mrs. Cerezo ("the Cerezo spouses") at the Makati address stated in the
G.R. SP No. 53572, as well as its Resolution dated 20 January 2000
complaint. However, the summons was returned unserved on 10
denying the motion for reconsideration. The Court of Appeals denied
November 1993 as the Cerezo spouses no longer held office nor
the petition for annulment of the Decision3 dated 30 May 1995
resided in Makati. On 18 April 1994, the trial court issued alias
rendered by the Regional Trial Court of Angeles City, Branch 56
summons against the Cerezo spouses at their address in Barangay Sta.
("trial court"), in Civil Case No. 7415. The trial court ordered
Maria, Camiling, Tarlac. The alias summons and a copy of the
petitioner Hermana R. Cerezo ("Mrs. Cerezo") to pay respondent
complaint were finally served on 20 April 1994 at the office of Atty.
David Tuazon ("Tuazon") actual damages, loss of earnings, moral
Cerezo, who was then working as Tarlac Provincial Prosecutor. Atty.
damages, and costs of suit.
Cerezo reacted angrily on learning of the service of summons upon his
person. Atty. Cerezo allegedly told Sheriff William Canlas: "Punyeta,
Antecedent Facts ano ang gusto mong mangyari? Gusto mong hindi ka makalabas ng
buhay dito? Teritoryo ko ito. Wala ka sa teritoryo mo."5
Around noontime of 26 June 1993, a Country Bus Lines passenger bus
with plate number NYA 241 collided with a tricycle bearing plate The records show that the Cerezo spouses participated in the
number TC RV 126 along Captain M. Palo Street, Sta. Ines, proceedings before the trial court. The Cerezo spouses filed a
Mabalacat, Pampanga. On 1 October 1993, tricycle driver Tuazon comment with motion for bill of particulars dated 29 April 1994 and a
filed a complaint for damages against Mrs. Cerezo, as owner of the
reply to opposition to comment with motion dated 13 June 1994. 6 On complaint in this case as a pauper has been cured by this
1 August 1994, the trial court issued an order directing the Cerezo Order.
spouses to file a comment to the opposition to the bill of particulars.
Atty. Elpidio B. Valera ("Atty. Valera") of Valera and Valera Law If within 15 days from receipt of this Order, the defendants do
Offices appeared on behalf of the Cerezo spouses. On 29 August 1994, not question on appeal this Order of this Court, the Court shall
Atty. Valera filed an urgent ex-parte motion praying for the resolution proceed to resolve the Motion for Bill of Particulars. 8
of Tuazon’s motion to litigate as a pauper and for the issuance of new
summons on the Cerezo spouses to satisfy proper service in On 27 September 1994, the Cerezo spouses filed an urgent ex-parte
accordance with the Rules of Court.7 motion for reconsideration. The trial court denied the motion for
reconsideration.
On 30 August 1994, the trial court issued an order resolving Tuazon’s
motion to litigate as a pauper and the Cerezo spouses’ urgent ex-parte On 14 November 1994, the trial court issued an order directing the
motion. The order reads: Cerezo spouses to file their answer within fifteen days from receipt of
the order. The Cerezo spouses did not file an answer. On 27 January
At the hearing on August 30, 1994, the plaintiff [Tuazon] 1995, Tuazon filed a motion to declare the Cerezo spouses in default.
testified that he is presently jobless; that at the time of the On 6 February 1995, the trial court issued an order declaring the
filing of this case, his son who is working in Malaysia helps Cerezo spouses in default and authorizing Tuazon to present his
him and sends him once in a while P300.00 a month, and that evidence. 9
he does not have any real property. Attached to the Motion to
Litigate as Pauper are his Affidavit that he is unemployed; a On 30 May 1995, after considering Tuazon’s testimonial and
Certification by the Barangay Captain of his poblacion that documentary evidence, the trial court ruled in Tuazon’s favor. The
his income is not enough for his family’s subsistence; and a trial court made no pronouncement on Foronda’s liability because
Certification by the Office of the Municipal Assessor that he there was no service of summons on him. The trial court did not hold
has no landholding in the Municipality of Mabalacat, Atty. Cerezo liable as Tuazon failed to show that Mrs. Cerezo’s
Province of Pampanga. business benefited the family, pursuant to Article 121(3) of the Family
Code. The trial court held Mrs. Cerezo solely liable for the damages
The Court is satisfied from the unrebutted testimony of the sustained by Tuazon arising from the negligence of Mrs. Cerezo’s
plaintiff that he is entitled to prosecute his complaint in this employee, pursuant to Article 2180 of the Civil Code. The dispositive
case as a pauper under existing rules. portion of the trial court’s decision reads:

On the other hand, the Court denies the prayer in the WHEREFORE, judgment is hereby rendered ordering the
Appearance and Urgent Ex-Parte Motion requiring new defendant Hermana Cerezo to pay the plaintiff:
summons to be served to the defendants. The Court is of the
opinion that any infirmity in the service of the summons to the a) For Actual Damages - P69,485.3
defendant before plaintiff was allowed to prosecute his
1) Expenses for operation and medical Treatment
 2) Cost of repair of the tricycle Exhibit 5 - Appearance and Urgent Ex-Parte Motion;
b) For loss of earnings - 39,921.00 Exhibit 6 - Order dated November 14, 1994;
c) For moral damages - 43,300.00 Exhibit 6-A - Postal certification dated January 13, 1995;
d) And to pay the cost of the suit. - 20,000.00 Exhibit 7 - Order dated February [illegible];
Exhibit 7-A - Court’s return slip addressed to Atty. Elpidio Valera;
The docket fees and other expenses in the filing of this suit Exhibit 7-B - Court’s return slip addressed to Spouses Juan and Herman
shall be lien on whatever judgment may be rendered in favor Exhibit 8 - Decision dated May [30], 1995
of the plaintiff. Exhibit 8-A - Court’s return slip addressed to defendant Hermana Cerez
Exhibit 8-B - Court’s return slip addressed to defendant’s counsel, Atty.
SO ORDERED.10
Exhibit 9 - Order dated September 21, 1995;
Mrs. Cerezo received a copy of the decision on 25 June 1995. On 10 Exhibit 9-A - Second Page of Exhibit 9;
July 1995, Mrs. Cerezo filed before the trial court a petition for relief Exhibit 9-B - Third page of Exhibit 9;
from judgment on the grounds of "fraud, mistake or excusable Exhibit 9-C - Fourth page of Exhibit 9;
negligence." Testifying before the trial court, both Mrs. Cerezo and
Exhibit 9-D - Court’s return slip addressed to Atty. Elpidio Valera;
Atty. Valera denied receipt of notices of hearings and of orders of the
court. Atty. Valera added that he received no notice before or during and
the 8 May 1995 elections, "when he was a senatorial candidate for the Exhibit 9-E - Court’s return slip addressed to plaintiff’s counsel, Atty.
KBL Party, and very busy, using his office and residence as Party Guzman.12
National Headquarters." Atty. Valera claimed that he was able to read
the decision of the trial court only after Mrs. Cerezo sent him a copy. 11 On 4 March 1998, the trial court issued an order 13 denying the petition
for relief from judgment. The trial court stated that having received
Tuazon did not testify but presented documentary evidence to prove the decision on 25 June 1995, the Cerezo spouses should have filed a
the participation of the Cerezo spouses in the case. Tuazon presented notice of appeal instead of resorting to a petition for relief from
the following exhibits: judgment. The trial court refused to grant relief from judgment
because the Cerezo spouses could have availed of the remedy of
Exhibit 1 - Sheriff’s return and summons; appeal. Moreover, the Cerezo spouses not only failed to prove fraud,
Exhibit 1-A - Alias summons dated April 20, 1994; accident, mistake or excusable negligence by conclusive evidence,
they also failed to prove that they had a good and substantial defense.
Exhibit 2 - Comment with Motion; The trial court noted that the Cerezo spouses failed to appeal because
Exhibit 3 - Minutes of the hearing held on August 1, 1994; they relied on an expected settlement of the case.
Exhibit 3-A - Signature of defendant’s counsel;
Exhibit 4 - Minutes of the hearing held on August 30, 1994; The Cerezo spouses subsequently filed before the Court of Appeals a
petition for certiorari under Section 1 of Rule 65. The petition was
Exhibit 4-A - Signature of the defendant’s counsel;
docketed as CA-G.R. SP No. 48132.14 The petition questioned whether The Court of Appeals denied the petition for annulment of judgment
the trial court acquired jurisdiction over the case considering there was in a resolution dated 21 October 1999. The resolution reads in part:
no service of summons on Foronda, whom the Cerezo spouses claimed
was an indispensable party. In a resolution15 dated 21 January 1999, In this case, records show that the petitioner previously filed
the Court of Appeals denied the petition for certiorari and affirmed with the lower court a Petition for Relief from Judgment on
the trial court’s order denying the petition for relief from judgment. the ground that they were wrongfully declared in default while
The Court of Appeals declared that the Cerezo spouses’ failure to file waiting for an amicable settlement of the complaint for
an answer was due to their own negligence, considering that they damages. The court a quo correctly ruled that such petition is
continued to participate in the proceedings without filing an answer. without merit. The defendant spouses admit that during the
There was also nothing in the records to show that the Cerezo spouses initial hearing they appeared before the court and even
actually offered a reasonable settlement to Tuazon. The Court of mentioned the need for an amicable settlement. Thus, the
Appeals also denied Cerezo spouses’ motion for reconsideration for lower court acquired jurisdiction over the defendant spouses.
lack of merit.
Therefore, petitioner having availed of a petition for relief, the
The Cerezo spouses filed before this Court a petition for review remedy of an annulment of judgment is no longer available.
on certiorari under Rule 45. Atty. Cerezo himself signed the petition, The proper action for the petitioner is to appeal the order of
docketed as G.R. No. 137593. On 13 April 1999, this Court rendered the lower court denying the petition for relief.
a resolution denying the petition for review on certiorari for failure to
attach an affidavit of service of copies of the petition to the Court of Wherefore, the instant petition could not be given due course
Appeals and to the adverse parties. Even if the petition complied with and should accordingly be dismissed.
this requirement, the Court would still have denied the petition as the
Cerezo spouses failed to show that the Court of Appeals committed a SO ORDERED.18
reversible error. The Court’s resolution was entered in the Book of
Entries and Judgments when it became final and executory on 28 June On 20 January 2000, the Court of Appeals denied the Cerezo spouses’
1999.16 motion for reconsideration.19 The Court of Appeals stated:
Undaunted, the Cerezo spouses filed before the Court of Appeals on 6 A distinction should be made between a court’s jurisdiction
July 1999 a petition for annulment of judgment under Rule 47 with
over a person and its jurisdiction over the subject matter of a
prayer for restraining order. Atty. Valera and Atty. Dionisio S. Daga case. The former is acquired by the proper service of
("Atty. Daga") represented Mrs. Cerezo in the petition, docketed as summons or by the parties’ voluntary appearance; while the
CA-G.R. SP No. 53572.17 The petition prayed for the annulment of the
latter is conferred by law.
30 May 1995 decision of the trial court and for the issuance of a writ
of preliminary injunction enjoining execution of the trial court’s
Resolving the matter of jurisdiction over the subject matter,
decision pending resolution of the petition.
Section 19(1) of B[atas] P[ambansa] 129 provides that
Regional Trial Courts shall exercise exclusive original
jurisdiction in all civil actions in which the subject of the
litigation is incapable of pecuniary estimation. Thus it was Records show that the petitioner previously filed with the
proper for the lower court to decide the instant case for lower court a Petition for Relief from Judgment on the ground
damages. that they were wrongfully declared in default while waiting
for an amicable settlement of the complaint for damages. The
Unlike jurisdiction over the subject matter of a case which is court a quo correctly ruled that such petition is without merit,
absolute and conferred by law; any defects [sic] in the jurisdiction having been acquired by the voluntary appearance
acquisition of jurisdiction over a person (i.e., improper filing of defendant spouses.
of civil complaint or improper service of summons) may be
waived by the voluntary appearance of parties. Once again, it bears stressing that having availed of a petition
for relief, the remedy of annulment of judgment is no longer
The lower court admits the fact that no summons was served available.
on defendant Foronda. Thus, jurisdiction over the person of
defendant Foronda was not acquired, for which reason he was Based on the foregoing, the motion for reconsideration could
not held liable in this case. However, it has been proven that not be given due course and is hereby DENIED.
jurisdiction over the other defendants was validly acquired by
the court a quo. SO ORDERED.20

The defendant spouses admit to having appeared in the initial The Issues
hearings and in the hearing for plaintiff’s motion to litigate as
a pauper. They even mentioned conferences where attempts On 7 February 2000, Mrs. Cerezo, this time with Atty. Daga alone
were made to reach an amicable settlement with plaintiff. representing her, filed the present petition for review
However, the possibility of amicable settlement is not a good on certiorari before this Court. Mrs. Cerezo claims that:
and substantial defense which will warrant the granting of said
petition. 1. In dismissing the Petition for Annulment of Judgment, the
Court of Appeals assumes that the issues raised in the petition
xxx for annulment is based on extrinsic fraud related to the denied
petition for relief notwithstanding that the grounds relied upon
Assuming arguendo that private respondent failed to reserve involves questions of lack of jurisdiction.
his right to institute a separate action for damages in the
criminal action, the petitioner cannot now raise such issue and 2. In dismissing the Petition for Annulment, the Court of
question the lower court’s jurisdiction because petitioner and Appeals disregarded the allegation that the lower court[’s]
her husband have waived such right by voluntarily appearing findings of negligence against defendant-driver Danilo
in the civil case for damages. Therefore, the findings and the Foronda [whom] the lower court did not summon is null and
decision of the lower court may bind them. void for want of due process and consequently, such findings
of negligence which is [sic] null and void cannot become the
 basis of the lower court to adjudge petitioner-employer liable copy of the decision. On 10 July 1995, Mrs. Cerezo filed before the
for civil damages. trial court a petition for relief from judgment under Rule 38, alleging
"fraud, mistake, or excusable negligence" as grounds. On 4 March
3. In dismissing the Petition for Annulment, the Court of 1998, the trial court denied Mrs. Cerezo’s petition for relief from
Appeals ignored the allegation that defendant-driver Danilo judgment. The trial court stated that Mrs. Cerezo could have availed
A. Foronda whose negligence is the main issue is an of appeal as a remedy and that she failed to prove that the judgment
indispensable party whose presence is compulsory but was entered through fraud, accident, mistake, or excusable negligence.
[whom] the lower court did not summon. Mrs. Cerezo then filed before the Court of Appeals a petition
for certiorari under Section 1 of Rule 65 assailing the denial of the
4. In dismissing the Petition for Annulment, the Court of petition for relief from judgment. On 21 January 1999, the Court of
Appeals ruled that assuming arguendo that private respondent Appeals dismissed Mrs. Cerezo’s petition. On 24 February 1999, the
failed to reserve his right to institute a separate action for appellate court denied Mrs. Cerezo’s motion for reconsideration. On
damages in the criminal action, the petitioner cannot now raise 11 March 1999, Mrs. Cerezo filed before this Court a petition for
such issue and question the lower court’s jurisdiction because review on certiorari under Rule 45, questioning the denial of the
petitioner [has] waived such right by voluntarily appearing in petition for relief from judgment. We denied the petition and our
the civil case for damages notwithstanding that lack of resolution became final and executory on 28 June 1999.
jurisdiction cannot be waived.21
On 6 July 1999, a mere eight days after our resolution became final
The Court’s Ruling and executory, Mrs. Cerezo filed before the Court of Appeals a
petition for annulment of the judgment of the trial court under Rule
The petition has no merit. As the issues are interrelated, we shall 47. Meanwhile, on 25 August 1999, the trial court issued over the
discuss them jointly. objection of Mrs. Cerezo an order of execution of the judgment in
Civil Case No. 7415. On 21 October 1999, the Court of Appeals
dismissed the petition for annulment of judgment. On 20 January
Remedies Available to a Party Declared in Default
2000, the Court of Appeals denied Mrs. Cerezo’s motion for
reconsideration. On 7 February 2000, Mrs. Cerezo filed the present
An examination of the records of the entire proceedings shows that
petition for review on certiorari under Rule 45 challenging the
three lawyers filed and signed pleadings on behalf of Mrs. Cerezo,
dismissal of her petition for annulment of judgment.
namely, Atty. Daga, Atty. Valera, and Atty. Cerezo. Despite their
number, Mrs. Cerezo’s counsels failed to avail of the proper remedies.
It is either by sheer ignorance or by malicious manipulation of legal Lina v. Court of Appeals22 enumerates the remedies available to a party
technicalities that they have managed to delay the disposition of the declared in default:
present case, to the detriment of pauper litigant Tuazon.
a) The defendant in default may, at any time after discovery
Mrs. Cerezo claims she did not receive any copy of the order declaring thereof and before judgment, file a motion under oath to set
the Cerezo spouses in default. Mrs. Cerezo asserts that she only came aside the order of default on the ground that his failure to
to know of the default order on 25 June 1995, when she received a answer was due to fraud, accident, mistake or excusable
 negligence, and that he has a meritorious defense (Sec. 3, Rule for trial de novo. The recorded evidence taken in the former trial, as
18 [now Sec. 3(b), Rule 9]); far as the same is material and competent to establish the issues, shall
be used at the new trial without retaking the same. 27
b) If the judgment has already been rendered when the
defendant discovered the default, but before the same has Mrs. Cerezo also had the alternative of filing under Rule 6528 a petition
become final and executory, he may file a motion for new for certiorari assailing the order of default within 60 days from notice
trial under Section 1 (a) of Rule 37; of the judgment. An order of default is interlocutory, and an aggrieved
party may file an appropriate special civil action under Rule 65.29 In a
c) If the defendant discovered the default after the judgment petition for certiorari, the appellate court may declare void both the
has become final and executory, he may file a petition for order of default and the judgment of default.
relief under Section 2 [now Section 1] of Rule 38; and
Clearly, Mrs. Cerezo had every opportunity to avail of these remedies
d) He may also appeal from the judgment rendered against within the reglementary periods provided under the Rules of Court.
him as contrary to the evidence or to the law, even if no However, Mrs. Cerezo opted to file a petition for relief from judgment,
petition to set aside the order of default has been presented by which is available only in exceptional cases. A petition for relief from
him (Sec. 2, Rule 41). (Emphasis added) judgment should be filed within the reglementary period of 60 days
from knowledge of judgment and six months from entry of judgment,
Moreover, a petition for certiorari to declare the nullity of a judgment pursuant to
by default is also available if the trial court improperly declared a party
in default, or even if the trial court properly declared a party in default, Rule 38 of the Rules of Civil Procedure. 30 Tuason v. Court of
if grave abuse of discretion attended such declaration. 23 Appeals31 explained the nature of a petition for relief from judgment:

Mrs. Cerezo admitted that she received a copy of the trial court’s When a party has another remedy available to him, which may
decision on 25 June 1995. Based on this admission, Mrs. Cerezo had either be a motion for new trial or appeal from an adverse
at least three remedies at her disposal: an appeal, a motion for new decision of the trial court, and he was not prevented by fraud,
trial, or a petition for certiorari. accident, mistake or excusable negligence from filing such
motion or taking such appeal, he cannot avail himself of this
Mrs. Cerezo could have appealed under Rule 4124 from the default petition. Indeed, relief will not be granted to a party who seeks
judgment within 15 days from notice of the judgment. She could have avoidance from the effects of the judgment when the loss of
availed of the power of the Court of Appeals to try cases and conduct the remedy at law was due to his own negligence; otherwise
hearings, receive evidence, and perform all acts necessary to resolve the petition for relief can be used to revive the right to appeal
factual issues raised in cases falling within its appellate jurisdiction. 25 which has been lost thru inexcusable negligence.

Mrs. Cerezo also had the option to file under Rule 3726 a motion for Evidently, there was no fraud, accident, mistake, or excusable
new trial within the period for taking an appeal. If the trial court grants negligence that prevented Mrs. Cerezo from filing an appeal, a motion
a new trial, the original judgment is vacated, and the action will stand
for new trial or a petition for certiorari. It was error for her to avail of restriction is to prevent this extraordinary action from being used by a
a petition for relief from judgment. losing party to make a complete farce of a duly promulgated decision
that has long become final and executory. There would be no end to
After our resolution denying Mrs. Cerezo’s petition for relief became litigation if parties who have unsuccessfully availed of any of the
final and executory, Mrs. Cerezo, in her last ditch attempt to evade appropriate remedies or lost them through their fault could still bring
liability, filed before the Court of Appeals a petition for annulment of an action for annulment of judgment.35 Nevertheless, we shall discuss
the judgment of the trial court. Annulment is available only on the the issues raised in the present petition to clear any doubt about the
grounds of extrinsic fraud and lack of jurisdiction. If based on extrinsic correctness of the decision of the trial court.
fraud, a party must file the petition within four years from its
discovery, and if based on lack of jurisdiction, before laches or Mrs. Cerezo’s Liability and the Trial Court’s Acquisition of
estoppel bars the petition. Extrinsic fraud is not a valid ground if such Jurisdiction
fraud was used as a ground, or could have been used as a ground, in a
motion for new trial or petition for relief from judgment. 32 Mrs. Cerezo contends that the basis of the present petition for
annulment is lack of jurisdiction. Mrs. Cerezo asserts that the trial
Mrs. Cerezo insists that lack of jurisdiction, not extrinsic fraud, was court could not validly render judgment since it failed to acquire
her ground for filing the petition for annulment of judgment. However, jurisdiction over Foronda. Mrs. Cerezo points out that there was no
a party may avail of the remedy of annulment of judgment under Rule service of summons on Foronda. Moreover, Tuazon failed to reserve
47 only if the ordinary remedies of new trial, appeal, petition for relief his right to institute a separate civil action for damages in the criminal
from judgment, or other appropriate remedies are no longer available action. Such contention betrays a faulty foundation. Mrs. Cerezo’s
through no fault of the party.33 Mrs. Cerezo could have availed of a contention proceeds from the point of view of criminal law and not of
new trial or appeal but through her own fault she erroneously availed civil law, while the basis of the present action of Tuazon is quasi-delict
of the remedy of a petition for relief, which was denied with finality. under the Civil Code, not delict under the Revised Penal Code.
Thus, Mrs. Cerezo may no longer avail of the remedy of annulment.
The same negligent act may produce civil liability arising from a delict
In any event, the trial court clearly acquired jurisdiction over Mrs. under Article 103 of the Revised Penal Code, or may give rise to an
Cerezo’s person. Mrs. Cerezo actively participated in the proceedings action for a quasi-delict under Article 2180 of the Civil Code. An
before the trial court, submitting herself to the jurisdiction of the trial aggrieved party may choose between the two remedies. An action
court. The defense of lack of jurisdiction fails in light of her active based on a quasi-delict may proceed independently from the criminal
participation in the trial court proceedings. Estoppel or laches may action.36 There is, however, a distinction between civil liability arising
also bar lack of jurisdiction as a ground for nullity especially if raised from a delict and civil liability arising from a quasi-delict. The choice
for the first time on appeal by a party who participated in the of remedy, whether to sue for a delict or a quasi-delict, affects the
proceedings before the trial court, as what happened in this case. 34 procedural and jurisdictional issues of the action. 37

For these reasons, the present petition should be dismissed for utter Tuazon chose to file an action for damages based on a quasi-delict. In
lack of merit. The extraordinary action to annul a final judgment is his complaint, Tuazon alleged that Mrs. Cerezo, "without exercising
restricted to the grounds specified in the rules. The reason for the due care and diligence in the supervision and management of her
employees and buses," hired Foronda as her driver. Tuazon became subsidiary.43 The words "primary and direct," as contrasted with
disabled because of Foronda’s "recklessness, gross negligence and "subsidiary," refer to the remedy provided by law for enforcing the
imprudence," aggravated by Mrs. Cerezo’s "lack of due care and obligation rather than to the character and limits of the
diligence in the selection and supervision of her employees, obligation.44 Although liability under Article 2180 originates from the
particularly Foronda."38 negligent act of the employee, the aggrieved party may sue the
employer directly. When an employee causes damage, the law
The trial court thus found Mrs. Cerezo liable under Article 2180 of the presumes that the employer has himself committed an act of
Civil Code. Article 2180 states in part: negligence in not preventing or avoiding the damage. This is the fault
that the law condemns. While the employer is civilly liable in a
Employers shall be liable for the damages caused by their subsidiary capacity for the employee’s criminal negligence, the
employees and household helpers acting within the scope of employer is also civilly liable directly and separately for his own civil
their assigned tasks, even though the former are not engaged negligence in failing to exercise due diligence in selecting and
in any business or industry. supervising his employee. The idea that the employer’s liability is
solely subsidiary is wrong.45
Contrary to Mrs. Cerezo’s assertion, Foronda is not an indispensable
party to the case. An indispensable party is one whose interest is The action can be brought directly against the person
affected by the court’s action in the litigation, and without whom no responsible (for another), without including the author of the
final resolution of the case is possible. 39 However, Mrs. Cerezo’s act. The action against the principal is accessory in the sense
liability as an employer in an action for a quasi-delict is not only that it implies the existence of a prejudicial act committed by
solidary, it is also primary and direct. Foronda is not an indispensable the employee, but it is not subsidiary in the sense that it can
party to the final resolution of Tuazon’s action for damages against not be instituted till after the judgment against the author of
Mrs. Cerezo. the act or at least, that it is subsidiary to the principal action;
the action for responsibility (of the employer) is in itself a
The responsibility of two or more persons who are liable for a quasi- principal action.46
delict is solidary.40 Where there is a solidary obligation on the part of
debtors, as in this case, each debtor is liable for the entire obligation. Thus, there is no need in this case for the trial court to acquire
Hence, each debtor is liable to pay for the entire obligation in full. jurisdiction over Foronda. The trial court’s acquisition of jurisdiction
There is no merger or renunciation of rights, but only mutual over Mrs. Cerezo is sufficient to dispose of the present case on the
representation.41 Where the obligation of the parties is solidary, either merits.
of the parties is indispensable, and the other is not even a necessary
party because complete relief is available from either. 42 Therefore, In contrast, an action based on a delict seeks to enforce the subsidiary
jurisdiction over Foronda is not even necessary as Tuazon may collect liability of the employer for the criminal negligence of the employee
damages from Mrs. Cerezo alone. as provided in Article 103 of the Revised Penal Code. To hold the
employer liable in a subsidiary capacity under a delict, the aggrieved
Moreover, an employer’s liability based on a quasi-delict is primary party must initiate a criminal action where the employee’s delict and
and direct, while the employer’s liability based on a delict is merely corresponding primary liability are established. 47 If the present action
proceeds from a delict, then the trial court’s jurisdiction over Foronda cases to go through this roundabout, unnecessary, and
is necessary. However, the present action is clearly for the quasi-delict probably useless procedure? In construing the laws, courts
of Mrs. Cerezo and not for the delict of Foronda. have endeavored to shorten and facilitate the pathways of
right and justice.50
The Cerezo spouses’ contention that summons be served anew on
them is untenable in light of their participation in the trial court Interest at the rate of 6% per annum is due on the amount of damages
proceedings. To uphold the Cerezo spouses’ contention would make a adjudged by the trial court.51 The 6% per annum interest shall
fetish of a technicality.48 Moreover, any irregularity in the service of commence from 30 May 1995, the date of the decision of the trial
summons that might have vitiated the trial court’s jurisdiction over the court. Upon finality of this decision, interest at 12% per annum, in lieu
persons of the Cerezo spouses was deemed waived when the Cerezo of 6% per annum, is due on the amount of damages adjudged by the
spouses filed a petition for relief from judgment. 49 trial court until full payment.

We hold that the trial court had jurisdiction and was competent to WHEREFORE, we DENY the instant petition for review. The
decide the case in favor of Tuazon and against Mrs. Cerezo even in Resolution dated 21 October 1999 of the Court of Appeals in CA-G.R.
the absence of Foronda. Contrary to Mrs. Cerezo’s contention, SP No. 53572, as well as its Resolution dated 20 January 2000 denying
Foronda is not an indispensable party to the present case. It is not even the motion for reconsideration, is AFFIRMED with
necessary for Tuazon to reserve the filing of a separate civil action the MODIFICATION that the amount due shall earn legal interest at
because he opted to file a civil action for damages against Mrs. Cerezo 6% per annum computed from 30 May 1995, the date of the trial
who is primarily and directly liable for her own civil negligence. The court’s decision. Upon finality of this decision, the amount due shall
words of Justice Jorge Bocobo in Barredo v. Garcia still hold true earn interest at 12% per annum, in lieu of 6% per annum, until full
today as much as it did in 1942: payment.

x x x [T]o hold that there is only one way to make defendant’s SO ORDERED.
liability effective, and that is, to sue the driver and exhaust his
(the latter’s) property first, would be tantamount to
compelling the plaintiff to follow a devious and cumbersome
method of obtaining relief. True, there is such a remedy under
our laws, but there is also a more expeditious way, which is
based on the primary and direct responsibility of the defendant
under article [2180] of the Civil Code. Our view of the law is
more likely to facilitate remedy for civil wrongs, because the
procedure indicated by the defendant is wasteful and
productive of delay, it being a matter of common knowledge
that professional drivers of taxis and other similar public
conveyances do not have sufficient means with which to pay
damages. Why, then, should the plaintiff be required in all
G.R. Nos. 155531-34 July 29, 2005 Order3 of the RTC denying petitioner’s Motion for Reconsideration.
The first assailed Order is quoted in full as follows:
MARY ANN RODRIGUEZ, Petitioners,
vs. "For consideration is the opposition of the accused, through counsel,
Hon. THELMA A. PONFERRADA, in Her Official Capacity as to the formal entry of appearance of private prosecutor.
Presiding Judge of the Regional Trial Court of Quezon City,
Branch 104; PEOPLE OF THE PHILIPPINES; and GLADYS "Accused, through counsel, contends that the private prosecutor is
NOCOM, Respondents. barred from appearing before this Court as his appearance is limited
to the civil aspect which must be presented and asserted in B.P. 22
DECISION cases pending before the Metropolitan Trial Court of Quezon City.

PANGANIBAN, J.: "The private prosecutor submitted comment stating that the offended
party did not manifest within fifteen (15) days following the filing of
Settled is the rule that the single act of issuing a bouncing check may the information that the civil liability arising from the crime has been
give rise to two distinct criminal offenses: estafa and violation of Batas or would be separately prosecuted and that she should therefore be
Pambansa Bilang 22 (BP 22). The Rules of Court allow the offended required to pay the legal fees pursuant to Section 20 of Rule 141 of the
party to intervene via a private prosecutor in each of these two penal Rules of Court, as amended.
proceedings. However, the recovery of the single civil liability arising
from the single act of issuing a bouncing check in "Considering that the prosecution under B.P. 22 is without prejudice
to any liability for violation of any provision of the Revised Penal
__________________ Code (BP 22, Sec. 5), the civil action for the recovery of the civil
liability arising from the estafa cases pending before this Court is
* On official leave. deemed instituted with the criminal action (Rule 111, Sec. 1 [a]). The
offended party may thus intervene by counsel in the prosecution of the
either criminal case bars the recovery of the same civil liability in the offense (Rule 110. Sec. 16).
other criminal action. While the law allows two simultaneous civil
remedies for the offended party, it authorizes recovery in only one. In "WHEREFORE, the appearance of a private prosecutor shall be
short, while two crimes arise from a single set of facts, only one civil allowed upon payment of the legal fees for these estafa cases pending
liability attaches to it. before this Court pursuant to Section 1 of Rule 141 of the Rules of
Court, as amended."4
The Case
The Facts
1
Before us is a Petition for Certiorari under Rule 65 of the Rules of
Court, seeking to reverse the July 27, 2002 Order 2 of the Regional The undisputed facts are narrated by petitioner as follows:
Court (RTC) of Quezon City (Branch 104) in Criminal Case Nos. Q-
01-106256 to Q-01-106259. Also assailed is the August 16, 2002
"On 10 December 2001, the Honorable Assistant City Prosecutor "As ordered by the Court, [p]rivate [c]omplainant through counsel
Rossana S. Morales-Montojo of Quezon City Prosecutor’s Office filed her Comment to the Opposition of herein [p]etitioner.
issued her Resolution in I.S. No. 01-15902, the dispositive portion of
which reads as follows: "On 27 June 2002, the [p]ublic [r]espondent court issued the first
assailed Order allowing the appearance of the [p]rivate [p]rosecutor in
‘Premises considered, there being PROBABLE CAUSE to charge the above-entitled criminal cases upon payment of the legal fees
respondent for ESTAFA under Article 315 paragraph 2(d) as amended pursuant to Section 1 of Rule 141 of the Rules of Court, as amended.
by PD 818 and for Violation of Batas Pambansa Blg. 22, it is
respectfully recommended that the attached Information be approved "On 31 July 2002, [a]ccused through counsel filed a Motion for
and filed in Court.’ Reconsideration dated 26 July 2002.

"As a consequence thereof, separate informations were separately "On 16 August 2002, the [p]ublic [r]espondent court issued the second
filed against herein [p]etitioner before proper [c]ourts, for Estafa and assailed Order denying the Motion for Reconsideration of herein
[v]iolation of Batas Pambansa Blg. 22. [p]etitioner."5

"Upon payment of the assessed and required docket fees by the Ruling of the Trial Court
[p]rivate [c]omplainant, the informations for [v]iolation of Batas
Pambansa Blg. 22 against herein [p]etitioner were filed and raffled to Noting petitioner’s opposition to the private prosecutor’s entry of
the Metropolitan Trial Court of Quezon City, Branch 42, docketed as appearance, the RTC held that the civil action for the recovery of civil
Criminal Cases Nos. 0108033 to 36. liability arising from the offense charged is deemed
instituted, unless the offended party (1) waives the civil action, (2)
"On the other hand, the informations for [e]stafa cases against herein reserves the right to institute it separately, or (3) institutes the civil
[p]etitioner were likewise filed and raffled to the Regional Trial Court action prior to the criminal action. Considering that the offended party
of Quezon City, Branch 104, docketed as Criminal Cases Nos. 01- had paid the corresponding filing fee for the estafa cases prior to the
106256 to 59. filing of the BP 22 cases with the Metropolitan Trial Court (MeTC),
the RTC allowed the private prosecutor to appear and intervene in the
"On 17 June 2002, petitioner through counsel filed in open court proceedings.
before the [p]ublic [r]espondent an ‘Opposition to the Formal Entry of
Appearance of the Private Prosecutor’ dated 14 June 2002. Hence, this Petition.6

"The [p]ublic [r]espondent court during the said hearing noted the Issues
Formal Entry of Appearance of Atty. Felix R. Solomon as [p]rivate
[p]rosecutor as well as the Opposition filed thereto by herein Petitioner raises this sole issue for the Court’s consideration:
[p]etitioner. x x x.
"Whether or not a [p]rivate [p]rosecutor can be allowed to intervene
and participate in the proceedings of the above-entitled [e]stafa cases
for the purpose of prosecuting the attached civil liability arising from under circumstances affording the offended party a reasonable
the issuance of the checks involved which is also subject mater of the opportunity to make such reservation.
pending B.P. 22 cases."7
"When the offended party seeks to enforce civil liability against the
The Court’s Ruling accused by way of moral, nominal, temperate, or exemplary damages
without specifying the amount thereof in the complaint or information,
The Petition has no merit. the filing fees therefor shall constitute a first lien on the judgment
awarding such damages.
Sole Issue:
xxxxxxxxx
Civil Action in BP 22 Case Not a Bar
"(b) The criminal action for violation of Batas Pambansa Blg. 22 shall
to Civil Action in Estafa Case be deemed to include the corresponding civil action. No reservation to
file such civil action separately shall be allowed.
Petitioner theorizes that the civil action necessarily arising from the
criminal case pending before the MTC for violation of BP 22 "Upon filing of the aforesaid joint criminal and civil actions, the
precludes the institution of the corresponding civil action in the offended party shall pay in full the filing fees based on the amount of
criminal case for estafa now pending before the RTC. She hinges her the check involved, which shall be considered as the actual damages
theory on the following provisions of Rules 110 and 111 of the Rules claimed. Where the complaint or information also seeks to recover
of Court: liquidated, moral, nominal, temperate or exemplary damages, the
offended party shall pay the filing fees based on the amounts alleged
"SECTION 16. Intervention of the offended party in criminal action. - therein. If the amounts are not so alleged but any of these damages are
- Where the civil action for recovery of civil liability is instituted in subsequently awarded by the court, the filing fees based on the amount
the criminal action pursuant to Rule 111, the offended party may awarded shall constitute a first lien on the judgment.
intervene by counsel in the prosecution of the offense."
"Where the civil action has been filed separately and trial thereof has
"SECTION 1. Institution of criminal and civil actions. -- (a) When a not yet commenced, it may be consolidated with the criminal action
criminal action is instituted, the civil action for the recovery of civil upon application with the court trying the latter case. If the application
liability arising from the offense charged shall be deemed instituted is granted, the trial of both actions shall proceed in accordance with
with the criminal action unless the offended party waives the civil section 2 of this Rule governing consolidation of the civil and criminal
action, reserves the right to institute it separately or institutes the civil actions."
action prior to the criminal action.
Based on the foregoing rules, an offended party may intervene in the
"The reservation of the right to institute separately the civil action shall prosecution of a crime, except in the following instances: (1) when,
be made before the prosecution starts presenting its evidence and from the nature of the crime and the law defining and punishing it, no
civil liability arises in favor of a private offended party; and (2) when,
from the nature of the offense, the offended parties are entitled to civil another. Viewing things pragmatically, we can readily see that what
indemnity, but (a) they waive the right to institute a civil action, (b) gives rise to the civil liability is really the obligation and the moral
expressly reserve the right to do so or (c) the suit has already been duty of everyone to repair or make whole the damage caused to
instituted. In any of these instances, the private complainant’s interest another by reason of his own act or omission, done intentionally or
in the case disappears and criminal prosecution becomes the sole negligently, whether or not the same be punishable by law. In other
function of the public prosecutor.8 None of these exceptions apply to words, criminal liability will give rise to civil liability only if the same
the instant case. Hence, the private prosecutor cannot be barred from felonious act or omission results in damage or injury to another and is
intervening in the estafa suit. the direct and proximate cause thereof. Damage or injury to another is
evidently the foundation of the civil action. Such is not the case in
True, each of the overt acts in these instances may give rise to two criminal actions for, to be criminally liable, it is enough that the act or
criminal liabilities -- one for estafa and another for violation of BP 22. omission complained of is punishable, regardless of whether or not it
But every such act of issuing a bouncing check involves only one civil also causes material damage to another. (See Sangco, Philippine Law
liability for the offended party, who has sustained only a single on Torts and Damages, 1978, Revised Edition, pp. 246-247)."
injury. 9 This is the import of Banal v. Tadeo,10 which we quote in part
as follows: Thus, the possible single civil liability arising from the act of issuing
a bouncing check can be the subject of both civil actions deemed
"Generally, the basis of civil liability arising from crime is the instituted with the estafa case and the BP 22 violation prosecution. In
fundamental postulate of our law that ‘Every man criminally liable is the crimes of both estafa and violation of BP 22, Rule 111 of the Rules
also civilly liable’ (Art. 100, The Revised Penal Code). Underlying of Court expressly allows, even automatically in the present case, the
this legal principle is the traditional theory that when a person commits institution of a civil action without need of election by the offended
a crime he offends two entities namely (1) the society in which he lives party. As both remedies are simultaneously available to this party,
in or the political entity called the State whose law he had violated; there can be no forum shopping.11
and (2) the individual member of that society whose person, right,
honor, chastity or property was actually or directly injured or damaged Hence, this Court cannot agree with what petitioner ultimately
by the same punishable act or omission. However, this rather broad espouses. At the present stage, no judgment on the civil liability has
and general provision is among the most complex and controversial been rendered in either criminal case. There is as yet no call for the
topics in criminal procedure. It can be misleading in its implications offended party to elect remedies and, after choosing one of them, be
especially where the same act or omission may be treated as a crime considered barred from others available to her.
in one instance and as a tort in another or where the law allows a
separate civil action to proceed independently of the course of the Election of Remedies
criminal prosecution with which it is intimately intertwined. Many
legal scholars treat as a misconception or fallacy the generally Petitioner is actually raising the doctrine of election of remedies. "In
accepted notion that the civil liability actually arises from the crime its broad sense, election of remedies refers to the choice by a party to
when, in the ultimate analysis, it does not. While an act or omission is an action of one of two or more coexisting remedial rights, where
felonious because it is punishable by law, it gives rise to civil liability several such rights arise out of the same facts, but the term has been
not so much because it is a crime but because it caused damage to generally limited to a choice by a party between inconsistent remedial
rights, the assertion of one being necessarily repugnant to, or a In the present cases before us, the institution of the civil actions with
repudiation of, the other."12 In its more restricted and technical sense, the estafa cases and the inclusion of another set of civil actions with
the election of remedies is the adoption of one of two or more the BP 22 cases are not exactly repugnant or inconsistent with each
coexisting ones, with the effect of precluding a resort to the others. 13 other. Nothing in the Rules signifies that the necessary inclusion of a
civil action in a criminal case for violation of the Bouncing Checks
The Court further elucidates in Mellon Bank v. Magsino14 as follows: Law20 precludes the institution in an estafa case of the corresponding
civil action, even if both offenses relate to the issuance of the same
"As a technical rule of procedure, the purpose of the doctrine of check.
election of remedies is not to prevent recourse to any remedy, but to
prevent double redress for a single wrong.15 It is regarded as an The purpose of Section 1(b) of Rule 111 is explained by Justice
application of the law of estoppel, upon the theory that a party cannot, Florenz D. Regalado (ret.), former chairman of the committee tasked
in the assertion of his right occupy inconsistent positions which form with the revision of the Rules of Criminal Procedure. He clarified that
the basis of his respective remedies. However, when a certain state of the special rule on BP 22 cases was added, because the dockets of the
facts under the law entitles a party to alternative remedies, both courts were clogged with such litigations; creditors were using the
founded upon the identical state of facts, these remedies are not courts as collectors. While ordinarily no filing fees were charged for
considered inconsistent remedies. In such case, the invocation of one actual damages in criminal cases, the rule on the necessary inclusion
remedy is not an election which will bar the other, unless the suit upon of a civil action with the payment of filing fees based on the face value
the remedy first invoked shall reach the stage of final adjudication or of the check involved was laid down to prevent the practice of
unless by the invocation of the remedy first sought to be enforced, the creditors of using the threat of a criminal prosecution to collect on their
plaintiff shall have gained an advantage thereby or caused detriment credit free of charge.21
or change of situation to the other. 16 It must be pointed out that
ordinarily, election of remedies is not made until the judicial Clearly, it was not the intent of the special rule to preclude the
proceedings has gone to judgment on the merits. 17 prosecution of the civil action that corresponds to the estafa case,
should the latter also be filed. The crimes of estafa and violation of BP
"Consonant with these rulings, this Court, through Justice J.B.L. 22 are different and distinct from each other. There is no identity of
Reyes, opined that while some American authorities hold that the mere offenses involved, for which legal jeopardy in one case may be
initiation of proceedings constitutes a binding choice of remedies that invoked in the other. The offenses charged in the informations are
precludes pursuit of alternative courses, the better rule is that no perfectly distinct from each other in point of law, however nearly they
binding election occurs before a decision on the merits is had or a may be connected in point of fact.22
detriment to the other party supervenes.18 This is because the principle
of election of remedies is discordant with the modern procedural What Section 1(b) of the Rules of Court prohibits is the reservation to
concepts embodied in the Code of Civil Procedure which permits a file the corresponding civil action. The criminal action shall be
party to seek inconsistent remedies in his claim for relief without being deemed to include the corresponding civil action. "[U]nless a separate
required to elect between them at the pleading stage of the litigation."19 civil action has been filed before the institution of the criminal
action, no such civil action can be instituted after the criminal action
has been filed as the same has been included therein."23 In the instant
case, the criminal action for estafa was admittedly filed prior to the
criminal case for violation of BP 22, with the corresponding filing fees
for the inclusion of the corresponding civil action paid accordingly. 24

Furthermore, the fact that the Rules do not allow the reservation of
civil actions in BP 22 cases cannot deprive private complainant of the
right to protect her interests in the criminal action for estafa. Nothing
in the current law or rules on BP 22 vests the jurisdiction of the
corresponding civil case exclusively in the court trying the BP 22
criminal case.25

In promulgating the Rules, this Court did not intend to leave the
offended parties without any remedy to protect their interests in estafa
cases. Its power to promulgate the Rules of Court is limited in the
sense that rules "shall not diminish, increase or modify substantive
rights."26 Private complainant’s intervention in the prosecution of
estafa is justified not only for the prosecution of her interests, but also
for the speedy and inexpensive administration of justice as mandated
by the Constitution.27

The trial court was, therefore, correct in holding that the private
prosecutor may intervene before the RTC in the proceedings for
estafa, despite the necessary inclusion of the corresponding civil
action in the proceedings for violation of BP 22 pending before the
MTC. A recovery by the offended party under one remedy, however,
necessarily bars that under the other. Obviously stemming from the
fundamental rule against unjust enrichment, 28 this is in essence the
rationale for the proscription in our law against double recovery for
the same act or omission.

WHEREFORE, the Petition is DISMISSED and the assailed

Order AFFIRMED. Costs against petitioner.

SO ORDERED.
G.R. No. 163597. July 29, 2005 the filing of a separate civil action in B.P. 22 cases; and (3) respondent
was guilty of forum shopping and unjust enrichment.2
HYATT INDUSTRIAL MANUFACTURING CORP., Petitioners,
vs. The trial court denied the motion to dismiss in its order dated
ASIA DYNAMIC ELECTRIX CORP. and COURT OF December 10, 2001. It ruled that since the act complained of arose
APPEALS, Respondents. from the alleged non-payment of the petitioner of its contractual debt,
and not the issuance of checks with insufficient funds, in accordance
DECISION with Article 31 of the Civil Code, the civil action could proceed
independently of the criminal actions. It said that Section 1(b) of Rule
PUNO, J.: 111 of the Revised Rules of Criminal Procedure does not apply to the
obligation in this case, it being ex-contractu and not ex-delicto.3
This is a petition for review of the decision of the Court of Appeals
dated October 8, 2003 in CA-G.R. SP No. 71467 and its resolution Respondent questioned said order before the Court of Appeals in a
dated May 14, 2004. The assailed decision and resolution reversed the petition for certiorari. The appellate court, in its decision dated
order dated December 10, 2001 of the Regional Trial Court of October 8, 2003, reversed the order of the trial court. It held that the
Mandaluyong City, Branch 210 in Civil Case No. MC 01-1493 civil actions deemed instituted with the filing of the criminal cases for
denying the motion to dismiss filed by herein respondent, Asia violation of B.P. 22 and Civil Case No. MC 01-1493 are of the same
Dynamic Electrix Corporation. nature, i.e., for sum of money between the same parties for the same
transaction. Considering that the courts where the two criminal cases
On April 4, 2001, petitioner Hyatt Industrial Manufacturing were pending acquired jurisdiction over the civil actions, which were
Corporation filed before the Regional Trial Court of Mandaluyong deemed instituted therein, the respondent court could no longer
City a complaint for recovery of sum of money against respondent acquire jurisdiction over the same case.4
Asia Dynamic Electrix Corporation. The complaint alleged that
respondent purchased from petitioner various electrical conduits and Respondent filed a motion for reconsideration which was denied by
fittings amounting ₱1,622,467.14. Respondent issued several checks the Court of Appeals in its resolution dated May 14, 2004. 5
in favor of petitioner as payment. The checks, however, were
dishonored by the drawee bank on the ground of insufficient Hence, this petition raising the following arguments:
funds/account closed. The complaint further alleged that respondent
failed to pay despite demand. It prayed that respondent be ordered to 1. There is no identity of interests, causes of action, and reliefs in Civil
pay the amount of purchase, plus interest and attorney’s fees. 1 Case No. MC 01-1493 before the Regional Trial Court of
Mandaluyong City and the criminal complaints for violation of BP
Respondent moved to dismiss the complaint on the following grounds: Blg. 22 filed against Gil Santillan and Juanito Pamatmat before the
(1) the civil action was deemed included in the criminal actions for Metropolitan Trial Court of Pasig City docketed as I.S. No. 00-01-
violation of Batas Pambansa Blg. 22 (B.P. 22) previously filed by 00304 and I.S. No. 00-01-00300.
petitioner against the officers of respondent corporation; (2) Section
1(b) of Rule 111 of the Revised Rules of Criminal Procedure prohibits 2. Petitioner is not guilty of forum shopping.
3. Petitioner did not violate Section 1(b) of Rule 111 of the Revised claimed. Where the complaint or information also seeks to recover
Rules on Criminal Procedure when it filed the complaint in Civil Case liquidated, moral, nominal, temperate or exemplary damages, the
No. MC 01-1493.6 offended party shall pay additional filing fees based on the amounts
alleged therein. If the amounts are not so alleged but any of these
The petition is unmeritorious. damages are subsequently awarded by the court, the filing fees based
on the amount awarded shall constitute a first lien on the judgment.
It appears that prior to the filing of the case for recovery of sum of
money before the Regional Trial Court of Mandaluyong City, Where the civil action has been filed separately and trial thereof has
petitioner had already filed separate criminal complaints for violation not yet commenced, it may be consolidated with the criminal action
of B.P. 22 against the officers of respondent corporation, Gil Santillan upon application with the court trying the latter case. If the application
and Juanito Pamatmat. They were docketed as I.S. No. 00-01- is granted, the trial of both actions shall proceed in accordance with
003047 and I.S. No. 00-01-00300,8 respectively, and were both section 2 of this Rule governing consolidation of the civil and criminal
pending before the Metropolitan Trial Court of Pasig City. These cases actions.
involve the same checks which are the subjects of Civil Case No. MC
01-1493 before the Regional Trial Court of Mandaluyong City. The foregoing rule was adopted from Circular No. 57-97 of this Court.
It specifically states that the criminal action for violation of B.P. 22
We agree with the ruling of the Court of Appeals that upon filing of shall be deemed to include the corresponding civil action. It also
the criminal cases for violation of B.P. 22, the civil action for the requires the complainant to pay in full the filing fees based on the
recovery of the amount of the checks was also impliedly instituted amount of the check involved. Generally, no filing fees are required
under Section 1(b) of Rule 111 of the 2000 Rules on Criminal for criminal cases, but because of the inclusion of the civil action in
Procedure. Under the present revised Rules, the criminal action for complaints for violation of B.P. 22, the Rules require the payment of
violation of B.P. 22 shall be deemed to include the corresponding civil docket fees upon the filing of the complaint. This rule was enacted to
action. The reservation to file a separate civil action is no longer help declog court dockets which are filled with B.P. 22 cases as
needed. 9 The Rules provide: creditors actually use the courts as collectors. Because ordinarily no
filing fee is charged in criminal cases for actual damages, the payee
Section 1. Institution of criminal and civil actions. — uses the intimidating effect of a criminal charge to collect his
credit gratis and sometimes, upon being paid, the trial court is not even
(a) x x x informed thereof.10 The inclusion of the civil action in the criminal
case is expected to significantly lower the number of cases filed before
(b) The criminal action for violation of Batas Pambansa Blg. 22 shall the courts for collection based on dishonored checks. It is also
be deemed to include the corresponding civil action. No reservation to expected to expedite the disposition of these cases. Instead of
instituting two separate cases, one for criminal and another for civil,
file such civil action separately shall be allowed.
only a single suit shall be filed and tried. It should be stressed that the
policy laid down by the Rules is to discourage the separate filing of
Upon filing of the aforesaid joint criminal and civil actions, the
the civil action. The Rules even prohibit the reservation of a separate
offended party shall pay in full the filing fees based on the amount of
civil action, which means that one can no longer file a separate civil
the check involved, which shall be considered as the actual damages
case after the criminal complaint is filed in court. The only instance in the suit that said officers acted beyond their authority in signing the
when separate proceedings are allowed is when the civil action is filed checks, hence, their acts may also be binding on respondent
ahead of the criminal case. Even then, the Rules encourage the corporation, depending on the outcome of the proceedings.
consolidation of the civil and criminal cases. We have previously
observed that a separate civil action for the purpose of recovering the Second, Civil Case No. MC 01-1493 and I.S. No. 00-01-00304 and
amount of the dishonored checks would only prove to be costly, I.S. No. 00-01-00300 seek to obtain the same relief. With the implied
burdensome and time-consuming for both parties and would further institution of the civil liability in the criminal actions before the
delay the final disposition of the case. This multiplicity of suits must Metropolitan Trial Court of Pasig City, the two actions are merged
be avoided. Where petitioners’ rights may be fully adjudicated in the into one composite proceeding, with the criminal action
proceedings before the trial court, resort to a separate action to recover predominating the civil. The prime purpose of the criminal action is to
civil liability is clearly unwarranted.11 In view of this special rule punish the offender to deter him and others from committing the same
governing actions for violation of B.P. 22, Article 31 of the Civil or similar offense, to isolate him from society, reform or rehabilitate
Code12 cited by the trial court will not apply to the case at bar. him or, in general, to maintain social order. The purpose, meanwhile,
of the civil action is for the restitution, reparation or indemnification
The pendency of the civil action before the court trying the criminal of the private offended party for the damage or injury he sustained by
case bars the filing of another civil action in another court on the reason of the delictual or felonious act of the accused. 14 Hence, the
ground of litis pendentia. The elements of litis pendentia as a ground relief sought in the civil aspect of I.S. No. 00-01-00304 and I.S. No.
for dismissal of an action are: (1) identity of parties, or at least such 00-01-00300 is the same as that sought in Civil Case No. MC 01-1493,
parties who represent the same interest in both actions; (2) identity of that is, the recovery of the amount of the checks, which, according to
rights asserted and relief prayed for, the relief being founded on the petitioner, represents the amount to be paid by respondent for its
same facts; and (3) the identity, with respect to the two preceding purchases. To allow petitioner to proceed with Civil Case No. MC 01-
particulars in the two cases, is such that any judgment that may be 1493 despite the filing of I.S. No. 00-01-00304 and I.S. No. 00-01-
rendered in the pending case, regardless of which party is successful, 00300 might result to a double payment of its claim.
would amount to res judicata in the other.13
Petitioner contends that there is no identity of causes of action in the
We reject petitioner’s assertion that there is no identity of parties and civil and criminal cases as the amount claimed in Civil Case No. MC
causes of action between the civil case, Civil Case No. MC 01-1493, 01-1493 is greater than the total amount of the checks involved in I.S.
and the criminal cases, I.S. No. 00-01-00304 and I.S. No. 00-01- No. 00-01-00304 and I.S. No. 00-01-00300. We are not persuaded.
00300. We find that the inclusion of additional checks in Civil Case No. MC
01-1493 is an attempt to circumvent the rule against forum shopping,
First, the parties in Civil Case No. MC 01-1493 represent the same to make it appear that the objects of the civil and criminal proceedings
interests as the parties in I.S. No. 00-01-00304 and I.S. No. 00-01- are different. It is clear from the records that the checks involved in
00300. I.S. No. 00-01-00304 and I.S. No. 00-01-00300 were filed I.S. No. 00-01-0030415 and I.S. No. 00-01-0030016 are the same
against the officers of respondent corporation who signed the checks checks cited by petitioner in Civil Case No. MC 01-1493.17 The Court
as agents thereof. The records indicate that the checks were in fact will certainly not allow petitioner to recover a sum of money twice
drawn in the account of respondent corporation. It has not been alleged based on the same set of checks. Neither will the Court allow it to
proceed with two actions based on the same set of checks to increase
its chances of obtaining a favorable ruling. Such runs counter to the
Court’s policy against forum shopping which is a deplorable practice
of litigants in resorting to two different fora for the purpose of
obtaining the same relief to increase his chances of obtaining a
favorable judgment.18 It is a practice that ridicules the judicial process,
plays havoc with the rules on orderly procedure, and is vexatious and
unfair to the other parties of the case. 19

Thus, we find that the Court of Appeals committed no reversible error

in the assailed decision and resolution.

IN VIEW WHEREOF, the petition is DENIED.

SO ORDERED.
G.R. No. 165732 December 14, 2006 Lauro Tangco, Evangeline's husband, together with his six minor
children (respondents) filed with the Regional Trial Court (RTC) of
SAFEGUARD SECURITY AGENCY, INC., and ADMER Quezon City, a criminal case of Homicide against Pajarillo, docketed
PAJARILLO, petitioners, as Criminal Case No. 0-97-73806 and assigned to Branch 78.
vs. Respondents reserved their right to file a separate civil action in the
LAURO TANGCO, VAL TANGCO, VERN LARRY TANGCO, said criminal case. The RTC of Quezon City subsequently convicted
VAN LAURO TANGCO, VON LARRIE TANGCO, VIEN LARI Pajarillo of Homicide in its Decision dated January 19, 2000. 3 On
TANGCO and VIVIEN LAURIZ TANGCO, respondent. appeal to the CA, the RTC decision was affirmed with modification
as to the penalty in a Decision4 dated July 31, 2000. Entry of Judgment
was made on August 25, 2001.

Meanwhile, on January 14, 1998, respondents filed with RTC, Branch

DECISION 273, Marikina City, a complaint5 for damages against Pajarillo for
negligently shooting Evangeline and against Safeguard for failing to
observe the diligence of a good father of a family to prevent the
damage committed by its security guard. Respondents prayed for
actual, moral and exemplary damages and attorney's fees.
AUSTRIA-MARTINEZ, J.:
In their Answer,6 petitioners denied the material allegations in the
Before us is a petition for review on certiorari filed by Safeguard complaint and alleged that Safeguard exercised the diligence of a good
father of a family in the selection and supervision of Pajarillo; that
Security Agency, Inc. (Safeguard) and Admer Pajarillo (Pajarillo)
assailing the Decision1 dated July 16, 2004 and the Resolution2 dated Evangeline's death was not due to Pajarillo's negligence as the latter
October 20, 2004 issued by the Court of Appeals (CA) in CA-G.R. acted only in self-defense. Petitioners set up a compulsory
CV No. 77462. counterclaim for moral damages and attorney's fees.

On November 3, 1997, at about 2:50 p.m., Evangeline Tangco Trial thereafter ensued. On January 10, 2003, the RTC rendered its
(Evangeline) went to Ecology Bank, Katipunan Branch, Quezon City, Decision,7 the dispositive portion of which reads:
to renew her time deposit per advise of the bank's cashier as she would
sign a specimen card. Evangeline, a duly licensed firearm holder with WHEREFORE, judgment is hereby rendered in favor of the
corresponding permit to carry the same outside her residence, plaintiffs, the heirs of Evangeline Tangco, and against
approached security guard Pajarillo, who was stationed outside the defendants Admer Pajarillo and Safeguard Security Agency,
bank, and pulled out her firearm from her bag to deposit the same for Inc. ordering said defendants to pay the plaintiffs, jointly and
safekeeping. Suddenly, Pajarillo shot Evangeline with his service severally, the following:
shotgun hitting her in the abdomen instantly causing her death.
 1. ONE HUNDRED FIFTY SEVEN THOUSAND The RTC also found Safeguard as employer of Pajarillo to be jointly
FOUR HUNDRED THIRTY PESOS (P157,430.00), and severally liable with Pajarillo. It ruled that while it may be
as actual damages conceded that Safeguard had perhaps exercised care in the selection
of its employees, particularly of Pajarillo, there was no sufficient
2. FIFTY THOUSAND PESOS (P50,000.00) as evidence to show that Safeguard exercised the diligence of a good
death indemnity; father of a family in the supervision of its employee; that Safeguard's
evidence simply showed that it required its guards to attend trainings
3. ONE MILLION PESOS (P1,000,000.00), as moral and seminars which is not the supervision contemplated under the law;
damages; that supervision includes not only the issuance of regulations and
instructions designed for the protection of persons and property, for
4. THREE HUNDRED THOUSAND PESOS the guidance of their servants and employees, but also the duty to see
(P300,000.00), as exemplary damages; to it that such regulations and instructions are faithfully complied with.

5. THIRTY THOUSAND PESOS (P30,000.00), as Petitioners appealed the RTC decision to the CA. On July 16, 2004,
attorney's fees; and the CA issued its assailed Decision, the dispositive portion of which
reads:
6. costs of suit.
IN VIEW OF ALL THE FOREGOING, the appealed decision
For lack of merit, defendants' counterclaim is hereby is hereby AFFIRMED, with the modification that Safeguard
DISMISSED. Security Agency, Inc.'s civil liability in this case is only
subsidiary under Art. 103 of the Revised Penal Code. No
pronouncement as to costs.9
SO ORDERED. 8
In finding that Safeguard is only subsidiarily liable, the CA held that
The RTC found respondents to be entitled to damages. It rejected
the applicable provisions are not Article 2180 in relation to Article
Pajarillo's claim that he merely acted in self-defense. It gave no
2176 of the Civil Code, on quasi-delicts, but the provisions on civil
credence to Pajarillo's bare claim that Evangeline was seen roaming
liability arising from felonies under the Revised Penal Code; that since
around the area prior to the shooting incident since Pajarillo had not
Pajarillo had been found guilty of Homicide in a final and executory
made such report to the head office and the police authorities. The
judgment and is said to be serving sentence in Muntinlupa, he must be
RTC further ruled that being the guard on duty, the situation demanded
adjudged civilly liable under the provisions of Article 100 of the
that he should have exercised proper prudence and necessary care by
Revised Penal Code since the civil liability recoverable in the criminal
asking Evangeline for him to ascertain the matter instead of shooting
action is one solely dependent upon conviction, because said liability
her instantly; that Pajarillo had already been convicted of Homicide in
arises from the offense charged and no other; that this is also the civil
Criminal Case No. 0-97-73806; and that he also failed to proffer proof
liability that is deemed extinguished with the extinction of the penal
negating liability in the instant case.
liability with a pronouncement that the fact from which the civil action
might proceed does not exist; that unlike in civil liability arising
from quasi-delict, the defense of diligence of a good father of a family and supervision of Pajarillo, it should be exonerated from civil
in the employment and supervision of employees is inapplicable and liability.
irrelevant in civil liabilities based on crimes or ex-delicto; that Article
103 of the Revised Penal Code provides that the liability of an We will first resolve whether the CA correctly held that respondents,
employer for the civil liability of their employees is only subsidiary, in filing a separate civil action against petitioners are limited to the
not joint or solidary. recovery of damages arising from a crime or delict, in which case the
liability of Safeguard as employer under Articles 102 and 103 of the
Petitioners filed their Motion for Reconsideration which the CA Revised Penal Code12 is subsidiary and the defense of due diligence in
denied in a Resolution dated October 20, 2004. the selection and supervision of employee is not available to it.

Hence, the instant Petition for Review on Certiorari with the The CA erred in ruling that the liability of Safeguard is only
following assignment of errors, to wit: subsidiary.

The Honorable Court of Appeals gravely erred in finding The law at the time the complaint for damages was filed is Rule 111
petitioner Pajarillo liable to respondents for the payment of of the 1985 Rules on Criminal Procedure, as amended, to wit:
damages and other money claims.
SECTION 1. Institution of criminal and civil actions. - When
The Honorable Court of Appeals gravely erred when it a criminal action is instituted, the civil action for the recovery
applied Article 103 of the Revised Penal Code in holding of civil liability is impliedly instituted with the criminal
petitioner Safeguard solidarily [sic] liable with petitioner action, unless the offended party waives the civil action,
Pajarillo for the payment of damages and other money claims. reserves his right to institute it separately, or institutes the civil
action prior to the criminal action.
The Honorable Court of Appeals gravely erred in failing to
find that petitioner Safeguard Security Agency, Inc. exercised Such civil action includes recovery of indemnity under the
due diligence in the selection and supervision of its Revised Penal Code, and damages under Articles 32, 33, 34,
employees, hence, should be excused from any liability. 10 and 2176 of the Civil Code of the Philippines arising from the
same act or omission of the accused.
The issues for resolution are whether (1) Pajarillo is guilty of
negligence in shooting Evangeline; and (2) Safeguard should be held Respondents reserved the right to file a separate civil action and in fact
solidarily liable for the damages awarded to respondents. filed the same on January 14, 1998.

Safeguard insists that the claim for damages by respondents is based The CA found that the source of damages in the instant case must be
on culpa aquiliana under Article 217611 of the Civil Code, in which the crime of homicide, for which he had already been found guilty of
case, its liability is jointly and severally with Pajarillo. However, since and serving sentence thereof, thus must be governed by the Revised
it has established that it had exercised due diligence in the selection Penal Code.
We do not agree. 8. That defendant Admer Pajarillo upon seeing Evangeline
Tangco, who brought her firearm out of her bag, suddenly
An act or omission causing damage to another may give rise to two without exercising necessary caution/care, and in idiotic
separate civil liabilities on the part of the offender, i.e., (1) civil manner, with the use of his shotgun, fired and burst bullets
liability ex delicto, under Article 100 of the Revised Penal Code; and upon Evangeline M. Tangco, killing her instantly. x x x
(2) independent civil liabilities, such as those (a) not arising from an
act or omission complained of as a felony, e.g., culpa contractual or xxxx
obligations arising from law under Article 31 of the Civil Code,
intentional torts under Articles 32 and 34, and culpa aquiliana under 16. That defendants, being employer and the employee are
Article 2176 of the Civil Code; or (b) where the injured party is jointly and severally liable for the death of Evangeline M.
granted a right to file an action independent and distinct from the Tangco.16
criminal action under Article 33 of the Civil Code. Either of these
liabilities may be enforced against the offender subject to the caveat Thus, a reading of respondents' complaint shows that the latter are
under Article 2177 of the Civil Code that the offended party cannot invoking their right to recover damages against Safeguard for their
recover damages twice for the same act or omission or under both vicarious responsibility for the injury caused by Pajarillo's act of
causes.13 shooting and killing Evangeline under Article 2176, Civil Code which
provides:
It is important to determine the nature of respondents' cause of action.
The nature of a cause of action is determined by the facts alleged in ARTICLE 2176. Whoever by act or omission causes damage
the complaint as constituting the cause of action.14 The purpose of an to another, there being fault or negligence, is obliged to pay
action or suit and the law to govern it is to be determined not by the for the damage done. Such fault or negligence, if there is no
claim of the party filing the action, made in his argument or brief, but pre-existing contractual relation between the parties is called
rather by the complaint itself, its allegations and prayer for relief. 15 a quasi-delict and is governed by the provisions of this
Chapter.
The pertinent portions of the complaint read:
The scope of Article 2176 is not limited to acts or omissions resulting
7. That Defendant Admer A. Pajarillo was the guard assigned from negligence. In Dulay v. Court of Appeals,17 we held:
and posted in the Ecology Bank – Katipunan Branch, Quezon
City, who was employed and under employment of Safeguard x x x Well-entrenched is the doctrine that Article 2176 covers
Security Agency, Inc. hence there is employer-employee not only acts committed with negligence, but also acts which
relationship between co-defendants. are voluntary and intentional. As far back as the definitive
case of Elcano v. Hill (77 SCRA 98 [1977]), this Court
The Safeguard Security Agency, Inc. failed to observe the already held that:
diligence of a good father of a family to prevent damage to
herein plaintiffs. "x x x Article 2176, where it refers to "fault or negligence,"
covers not only acts "not punishable by law" but also acts
 criminal in character, whether intentional and voluntary It would appear that plaintiffs instituted this action on the
or negligent. Consequently, a separate civil action lies against assumption that defendant Pontino's negligence in the
the offender in a criminal act, whether or not he is criminally accident of May 10, 1969 constituted a quasi-delict. The
prosecuted and found guilty or acquitted, provided that the Court cannot accept the validity of that assumption. In
offended party is not allowed, if he is actually charged also Criminal Case No. 92944 of this Court, plaintiffs had already
criminally, to recover damages on both scores, and would be appeared as complainants. While that case was pending, the
entitled in such eventuality only to the bigger award of the offended parties reserved the right to institute a separate civil
two, assuming the awards made in the two cases vary. In other action. If, in a criminal case, the right to file a separate civil
words, the extinction of civil liability referred to in Par. (e) of action for damages is reserved, such civil action is to be based
Section 3, Rule 111, refers exclusively to civil liability on crime and not on tort. That was the ruling in Joaquin vs.
founded on Article 100 of the Revised Penal Code, whereas Aniceto, L-18719, Oct. 31, 1964.
the civil liability for the same act considered as quasi-delict
only and not as a crime is not extinguished even by a We do not agree. The doctrine in the case cited by the trial
declaration in the criminal case that the criminal act charged court is inapplicable to the instant case x x x.
has not happened or has not been committed by the accused.
Briefly stated, We here hold, in reiteration of Garcia, that xxxx
culpa aquiliana includes voluntary and negligent acts which
may be punishable by law." (Emphasis supplied) In cases of negligence, the injured party or his heirs has the
choice between an action to enforce the civil liability arising
The civil action filed by respondents was not derived from the criminal from crime under Article 100 of the Revised Penal Code and
liability of Pajarillo in the criminal case but one based on culpa an action for quasi-delict under Article 2176-2194 of the Civil
aquiliana or quasi-delict which is separate and distinct from the civil Code. If a party chooses the latter, he may hold the employer
liability arising from crime.18 The source of the obligation sought to solidarily liable for the negligent act of his employee, subject
be enforced in the civil case is a quasi-delict not an act or omission to the employer's defense of exercise of the diligence of a
punishable by law. good father of the family.

In Bermudez v. Melencio-Herrera,19 where the issue involved was In the case at bar, the action filed by appellant was an action
whether the civil action filed by plaintiff-appellants is founded on for damages based on quasi-delict. The fact that appellants
crime or on quasi-delict, we held: reserved their right in the criminal case to file an
independent civil action did not preclude them from
x x x The trial court treated the case as an action based on a choosing to file a civil action for quasi-delict.20 (Emphasis
crime in view of the reservation made by the offended party supplied)
in the criminal case (Criminal Case No. 92944), also pending
before the court, to file a separate civil action. Said the trial Although the judgment in the criminal case finding Pajarillo guilty of
court: Homicide is already final and executory, such judgment has no
relevance or importance to this case. 21 It would have been entirely
different if respondents' cause of action was for damages arising from conclusion; and (9) when the findings of fact of the CA are premised
a delict, in which case the CA is correct in finding Safeguard to be on the absence of evidence and are contradicted by the evidence on
only subsidiary liable pursuant to Article 103 of the Revised Penal record. [24]
Code. 22
A thorough review of the records of the case fails to show any cogent
As clearly shown by the allegations in the complaint, respondents' reason for us to deviate from the factual finding of the trial court and
cause of action is based on quasi-delict. Under Article 2180 of the affirmed by the CA that petitioner Pajarillo was guilty of negligence
Civil Code, when the injury is caused by the negligence of the in shooting Evangeline.
employee, there instantly arises a presumption of law that there was
negligence on the part of the master or the employer either in the Respondents' evidence established that Evangeline's purpose in going
selection of the servant or employee, or in the supervision over him to the bank was to renew her time deposit. 25 On the other hand,
after selection or both. The liability of the employer under Article Pajarillo claims that Evangeline drew a gun from her bag and aimed
2180 is direct and immediate. Therefore, it is incumbent upon the same at him, thus, acting instinctively, he shot her in self-defense.
petitioners to prove that they exercised the diligence of a good father
of a family in the selection and supervision of their employee. Pajarillo testified that when Evangeline aimed the gun at him at a
distance of about one meter or one arm's length26 he stepped backward,
We must first resolve the issue of whether Pajarillo was negligent in loaded the chamber of his gun and shot her. 27 It is however
shooting Evangeline. unimaginable that petitioner Pajarillo could still make such
movements if indeed the gun was already pointed at him. Any
The issue of negligence is factual in nature. Whether a person is movement could have prompted Evangeline to pull the trigger to shoot
negligent or not is a question of fact, which, as a general rule, we him.
cannot pass upon in a petition for review on certiorari, as our
jurisdiction is limited to reviewing errors of law.23 Generally, factual Petitioner Pajarillo would like to justify his action in shooting
findings of the trial court, affirmed by the CA, are final and conclusive Evangeline on his mere apprehension that Evangeline will stage a
and may not be reviewed on appeal. The established exceptions are: bank robbery. However, such claim is befuddled by his own
(1) when the inference made is manifestly mistaken, absurd or testimony. Pajarillo testified that prior to the incident, he saw
impossible; (2) when there is grave abuse of discretion; (3) when the Evangeline roaming under the fly over which was about 10 meters
findings are grounded entirely on speculations, surmises or away from the bank28 and saw her talking to a man thereat;29 that she
conjectures; (4) when the judgment of the CA is based on left the man under the fly-over, crossed the street and approached the
misapprehension of facts; (5) when the findings of fact are conflicting; bank. However, except for the bare testimony of Pajarillo, the records
(6) when the CA, in making its findings, went beyond the issues of the do not show that indeed Evangeline was seen roaming near the vicinity
case and the same is contrary to the admissions of both appellant and of the bank and acting suspiciously prior to the shooting incident. In
appellee; (7) when the findings of fact are conclusions without citation fact, there is no evidence that Pajarillo called the attention of his head
of specific evidence on which they are based; (8) when the CA guard or the bank's branch manager regarding his concerns or that he
manifestly overlooked certain relevant facts not disputed by the parties reported the same to the police authorities whose outpost is just about
and which, if properly considered, would justify a different 15 meters from the bank.
Moreover, if Evangeline was already roaming the vicinity of the bank, evidence other than his testimony which was even doubtful. Pajarillo's
she could have already apprised herself that Pajarillo, who was posted apprehension that Evangeline will shoot him to stage a bank robbery
outside the bank, was armed with a shotgun; that there were two has no basis at all. It is therefore clear that the alleged threat of bank
guards inside the bank30 manning the entrance door. Thus, it is quite robbery was just a figment of Pajarillo's imagination which caused
incredible that if she really had a companion, she would leave him such unfounded unlawful aggression on his part.
under the fly-over which is 10 meters far from the bank and stage a
bank robbery all by herself without a back-up. In fact, she would have Petitioners argue that Evangeline was guilty of contributory
known, after surveying the area, that aiming her gun at Pajarillo would negligence. Although she was a licensed firearm holder, she had no
not ensure entrance to the bank as there were guards manning the business bringing the gun in such establishment where people would
entrance door. react instinctively upon seeing the gun; that had Evangeline been
prudent, she could have warned Pajarillo before drawing the gun and
Evidence, to be believed, must not only proceed from the mouth of a did not conduct herself with suspicion by roaming outside the vicinity
credible witness, but it must be credible in itself — such as the of the bank; that she should not have held the gun with the nozzle
common experience and observation of mankind can approve as pointed at Pajarillo who mistook the act as hold up or robbery.
probable under the circumstances. We have no test of the truth of
human testimony, except its conformity to our knowledge, We are not persuaded.
observation and experience. Whatever is repugnant to these belongs
to the miraculous and is outside judicial cognizance. 31 As we have earlier held, Pajarillo failed to substantiate his claim that
Evangeline was seen roaming outside the vicinity of the bank and
That Evangeline just wanted to deposit her gun before entering the acting suspiciously prior to the shooting incident. Evangeline's death
bank and was actually in the act of pulling her gun from her bag when was merely due to Pajarillo's negligence in shooting her on his
petitioner Pajarillo recklessly shot her, finds support from the imagined threat that Evangeline will rob the bank.
contentions raised in petitioners' petition for review where they argued
that when Evangeline approached the bank, she was seen pulling a gun Safeguard contends that it cannot be jointly held liable since it had
from inside her bag and petitioner Pajarillo who was suddenly beset adequately shown that it had exercised the diligence required in the
by fear and perceived the act as a dangerous threat, shot and killed the selection and supervision of its employees. It claims that it had
deceased out of pure instinct;32 that the act of drawing a gun is a required the guards to undergo the necessary training and to submit
threatening act, regardless of whether or not the gun was intended to the requisite qualifications and credentials which even the RTC found
be used against petitioner Pajarillo; 33 that the fear that was created in to have been complied with; that the RTC erroneously found that it
the mind of petitioner Pajarillo as he saw Evangeline Tangco drawing did not exercise the diligence required in the supervision of its
a gun from her purse was suddenly very real and the former merely employee. Safeguard further claims that it conducts monitoring of the
reacted out of pure self-preservation.34 activities of its personnel, wherein supervisors are assigned to
routinely check the activities of the security guards which include
Considering that unlawful aggression on the part of Evangeline is among others, whether or not they are in their proper post and with
absent, Pajarillo's claim of self-defense cannot be accepted specially proper equipment, as well as regular evaluations of the employees'
when such claim was uncorroborated by any separate competent performances; that the fact that Pajarillo loaded his firearm contrary
to Safeguard's operating procedure is not sufficient basis to say that In the selection of prospective employees, employers are required to
Safeguard had failed its duty of proper supervision; that it was examine them as to their qualifications, experience, and service
likewise error to say that Safeguard was negligent in seeing to it that records.35 On the other hand, due diligence in the supervision of
the procedures and policies were not properly implemented by reason employees includes the formulation of suitable rules and regulations
of one unfortunate event. for the guidance of employees and the issuance of proper instructions
intended for the protection of the public and persons with whom the
We are not convinced. employer has relations through his or its employees and the imposition
of necessary disciplinary measures upon employees in case of breach
Article 2180 of the Civil Code provides: or as may be warranted to ensure the performance of acts
indispensable to the business of and beneficial to their employer. To
Art. 2180. The obligation imposed by Article 2176 is this, we add that actual implementation and monitoring of consistent
demandable not only for one's own acts or omissions, but also compliance with said rules should be the constant concern of the
for those of persons for whom one is responsible. employer, acting through dependable supervisors who should
regularly report on their supervisory functions. 36 To establish these
factors in a trial involving the issue of vicarious liability, employers
xxxx
must submit concrete proof, including documentary evidence.
Employers shall be liable for the damages caused by their
employees and household helpers acting within the scope of We agree with the RTC's finding that Safeguard had exercised the
their assigned tasks, even though the former are not engaged diligence in the selection of Pajarillo since the record shows that
Pajarillo underwent a psychological and neuro-psychiatric evaluation
in any business or industry.
conducted by the St. Martin de Porres Center where no psychoses
ideations were noted, submitted a certification on the Pre-licensing
xxxx
training course for security guards, as well as police and NBI
clearances.
The responsibility treated of in this article shall cease when
the persons herein mentioned prove that they observed all the
The RTC did not err in ruling that Safeguard fell short of the diligence
diligence of a good father of a family to prevent damage.
required in the supervision of its employee, particularly Pajarillo. In
this case, while Safeguard presented Capt. James Camero, its Director
As the employer of Pajarillo, Safeguard is primarily and solidarily for Operations, who testified on the issuance of company rules and
liable for the quasi-delict committed by the former. Safeguard is regulations, such as the Guidelines of Guards Who Will Be Assigned
presumed to be negligent in the selection and supervision of his To Banks,37 Weapons Training,38 Safeguard Training Center
employee by operation of law. This presumption may be overcome Marksmanship Training Lesson Plan, 39 Disciplinary/Corrective
only by satisfactorily showing that the employer exercised the care Sanctions,40 it had also been established during Camero's cross-
and the diligence of a good father of a family in the selection and the examination that Pajarillo was not aware of such rules and
supervision of its employee. regulations.41 Notwithstanding Camero's clarification on his re-direct
examination that these company rules and regulations are lesson plans
as a basis of guidelines of the instructors during classroom instructions As to the award of moral damages, Article 2206 of the Civil Code
and not necessary to give students copy of the same, 42 the records do provides that the spouse, legitimate children and illegitimate
not show that Pajarillo had attended such classroom instructions. descendants and ascendants of the deceased may demand moral
damages for mental anguish by reason of the death of the deceased.
The records also failed to show that there was adequate training and Moral damages are awarded to enable the injured party to obtain
continuous evaluation of the security guard's performance. Pajarillo means, diversions or amusements that will serve to alleviate the moral
had only attended an in-service training on March 1, 1997 conducted suffering he/she has undergone, by reason of the defendant's culpable
by Toyota Sta. Rosa, his first assignment as security guard of action. Its award is aimed at restoration, as much as possible, of the
Safeguard, which was in collaboration with Safeguard. It was spiritual status quo ante; thus it must be proportionate to the suffering
established that the concept of such training was purely on security of inflicted.45 The intensity of the pain experienced by the relatives of the
equipments to be guarded and protection of the life of the employees. 43 victim is proportionate to the intensity of affection for him and bears
no relation whatsoever with the wealth or means of the offender. 46
It had not been established that after Pajarillo's training in Toyota,
Safeguard had ever conducted further training of Pajarillo when he In this case, respondents testified as to their moral suffering caused by
was later assigned to guard a bank which has a different nature of Evangeline's death was so sudden causing respondent Lauro to lose a
business with that of Toyota. In fact, Pajarillo testified that being on wife and a mother to six children who were all minors at the time of
duty in a bank is different from being on duty in a factory since a bank her death. In People v. Teehankee, Jr.,47 we awarded one million pesos
is a very sensitive area.44 as moral damages to the heirs of a seventeen-year-old girl who was
murdered. In Metro Manila Transit Corporation v. Court of
Moreover, considering his reactions to Evangeline's act of just Appeals,48 we likewise awarded the amount of one million pesos as
depositing her firearm for safekeeping, i.e., of immediately shooting moral damages to the parents of a third year high school student and
her, confirms that there was no training or seminar given on how to who was also their youngest child who died in a vehicular accident
handle bank clients and on human psychology. since the girl's death left a void in their lives. Hence, we hold that the
respondents are also entitled to the amount of one million pesos as
Furthermore, while Safeguard would like to show that there were Evangeline's death left a void in the lives of her husband and minor
inspectors who go around the bank two times a day to see the daily children as they were deprived of her love and care by her untimely
performance of the security guards assigned therein, there was no demise.
record ever presented of such daily inspections. In fact, if there was
really such inspection made, the alleged suspicious act of Evangeline We likewise uphold the award of exemplary damages in the amount
could have been taken noticed and reported. of P300,000.00. Under Article 2229 of the Civil Code, exemplary
damages are imposed by way of example or correction for the public
Turning now to the award of damages, we find that the award of actual good, in addition to moral, temperate, liquidated or compensatory
damages in the amount P157,430.00 which were the expenses incurred damages.49 It is awarded as a deterrent to socially deleterious actions.
by respondents in connection with the burial of Evangeline were In quasi-delict, exemplary damages may be granted if the defendant
supported by receipts. The award of P50,000.00 as civil indemnity for acted with gross negligence. 50
the death of Evangeline is likewise in order.
Pursuant to Article 2208 of the Civil Code, attorney's fees may be
recovered when, as in the instant case, exemplary damages are
awarded. Hence, we affirm the award of attorney's fees in the amount
of P30,000.00.

WHEREFORE, the petition for review is DENIED. The Decision

dated July 16, 2004 of the Court of Appeals
is AFFIRMED with MODIFICATION that the civil liability of
petitioner Safeguard Security Agency, Inc.
is SOLIDARY and PRIMARY under Article 2180 of the Civil Code.

SO ORDERED.
G.R. No. 147703 April 14, 2004 The facts of the case are summarized by the CA in this wise:

PHILIPPINE RABBIT BUS LINES, INC., petitioner, "On July 27, 1994, accused [Napoleon Roman y
vs. Macadangdang] was found guilty and convicted of the crime
PEOPLE OF THE PHILIPPINES, respondent. of reckless imprudence resulting to triple homicide, multiple
physical injuries and damage to property and was sentenced
DECISION to suffer the penalty of four (4) years, nine (9) months and
eleven (11) days to six (6) years, and to pay damages as
PANGANIBAN, J.: follows:

When the accused-employee absconds or jumps bail, the judgment ‘a. to pay the heirs of JUSTINO TORRES the sum of
meted out becomes final and executory. The employer cannot defeat ₱50,000.00 as indemnity for his death, plus the sum
the finality of the judgment by filing a notice of appeal on its own of ₱25,383.00, for funeral expenses, his unearned
behalf in the guise of asking for a review of its subsidiary civil income for one year at ₱2,500.00 a month,
liability. Both the primary civil liability of the accused-employee and ₱50,000.00 as indemnity for the support of Renato
the subsidiary civil liability of the employer are carried in one single Torres, and the further sum of ₱300,000.00 as moral
decision that has become final and executory. damages;

The Case ‘b. to the heirs of ESTRELLA VELERO, the sum of

₱50,000.00 as indemnity for her death, the sum of
Before this Court is a Petition for Review1 under Rule 45 of the Rules ₱237,323.75 for funeral expenses, her unearned
of Court, assailing the March 29, 20002 and the March 27, income for three years at ₱45,000.00 per annum, and
20013 Resolutions of the Court of Appeals (CA) in CA-GR CV No. the further sum of ₱1,000,000.00 as moral damages
59390. Petitioner’s appeal from the judgment of the Regional Trial and ₱200,000.00 as attorney’s fees[;]
Court (RTC) of San Fernando, La Union in Criminal Case No. 2535
was dismissed in the first Resolution as follows: ‘c. to the heirs of LORNA ANCHETA, the sum of
₱50,000.00 as indemnity for her death, the sum of
"WHEREFORE, for all the foregoing, the motion to dismiss ₱22,838.00 as funeral expenses, the sum of
is GRANTED and the appeal is ordered DISMISSED."4 ₱20,544.94 as medical expenses and her loss of
income for 30 years at ₱1,000.00 per month, and the
The second Resolution denied petitioner’s Motion for further sum of ₱100,000.00 for moral damages;
Reconsideration.5
‘d. to MAUREEN BRENNAN, the sum of
₱229,654.00 as hospital expenses, doctor’s fees of
The Facts
₱170,000.00 for the orthopedic surgeon, ₱22,500.00
for the [n]eurologist, an additional indemnity [of] at
least ₱150,000.00 to cover future correction of totally wrecked vehicle; to the owner of the jeepney,
deformity of her limbs, and moral damages in the the amount of ₱22,698.38 as actual damages;’
amount of ₱1,000,000.00;
"The court further ruled that [petitioner], in the event of the
‘e. to ROSIE BALAJO, the sum of ₱3,561.46 as insolvency of accused, shall be liable for the civil liabilities of
medical expenses, ₱2,000.00 as loss of income, and the accused. Evidently, the judgment against accused had
₱25,000.00 as moral damages; become final and executory.

‘f. to TERESITA TAMONDONG, the sum of "Admittedly, accused had jumped bail and remained at-large.
₱19,800.47 as medical expenses, ₱800.00 for loss of It is worth mention[ing] that Section 8, Rule 124 of the Rules
income, and ₱25,000.00 as moral damages; of Court authorizes the dismissal of appeal when appellant
jumps bail. Counsel for accused, also admittedly hired and
‘g. to JULIANA TABTAB, the amount of ₱580.81 as provided by [petitioner], filed a notice of appeal which was
medical expenses, ₱4,600.00 as actual damages and denied by the trial court. We affirmed the denial of the notice
her loss earnings of ₱1,400.00 as well as moral of appeal filed in behalf of accused.
damages in the amount of ₱10,000.00;
"Simultaneously, on August 6, 1994, [petitioner] filed its
‘h. to MIGUEL ARQUITOLA, the sum of notice of appeal from the judgment of the trial court. On April
₱12,473.82 as hospital expenses, ₱14,530.00 as 29, 1997, the trial court gave due course to [petitioner’s]
doctor’s fees, ₱1,000.00 for medicines and notice of appeal. On December 8, 1998, [petitioner] filed its
₱50,000.00 as moral damages; brief. On December 9, 1998, the Office of the Solicitor
General received [a] copy of [petitioner’s] brief. On January
‘i. to CLARITA CABANBAN, the sum of ₱155.00 8, 1999, the OSG moved to be excused from filing
for medical expenses, ₱87.00 for medicines, [respondents’] brief on the ground that the OSG’s authority to
₱1,710.00 as actual damages and ₱5,000.00 as moral represent People is confined to criminal cases on appeal. The
damages; motion was however denied per Our resolution of May 31,
1999. On March 2, 1999, [respondent]/private prosecutor
‘j. to MARIANO CABANBAN, the sum of filed the instant motion to dismiss."6 (Citations omitted)
₱1,395.00 for hospital bills, ₱500.00 for medicine,
₱2,100.00 as actual damages, ₱1,200.00 for loss of Ruling of the Court of Appeals
income and ₱5,000.00 as moral damages;
The CA ruled that the institution of a criminal case implied the
‘k. to La Union Electric Company as the registered institution also of the civil action arising from the offense. Thus, once
owner of the Toyota Hi-Ace Van, the amount of determined in the criminal case against the accused-employee, the
₱250,000.00 as actual damages for the cost of the employer’s subsidiary civil liability as set forth in Article 103 of the
Revised Penal Code becomes conclusive and enforceable.
The appellate court further held that to allow an employer to dispute against the accused-employee has not attained finality. The former
independently the civil liability fixed in the criminal case against the insists that its appeal stayed the finality, notwithstanding the fact that
accused-employee would be to amend, nullify or defeat a final the latter had jumped bail. In effect, petitioner argues that its appeal
judgment. Since the notice of appeal filed by the accused had already takes the place of that of the accused-employee.
been dismissed by the CA, then the judgment of conviction and the
award of civil liability became final and executory. Included in the We are not persuaded.
civil liability of the accused was the employer’s subsidiary liability.
Appeals in Criminal Cases
Hence, this Petition.7
Section 1 of Rule 122 of the 2000 Revised Rules of Criminal
The Issues Procedure states thus:

Petitioner states the issues of this case as follows: "Any party may appeal from a judgment or final order, unless
the accused will be placed in double jeopardy."
"A. Whether or not an employer, who dutifully participated in
the defense of its accused-employee, may appeal the judgment Clearly, both the accused and the prosecution may appeal a criminal
of conviction independently of the accused. case, but the government may do so only if the accused would not
thereby be placed in double jeopardy.9 Furthermore, the prosecution
"B. Whether or not the doctrines of Alvarez v. Court of cannot appeal on the ground that the accused should have been given
Appeals (158 SCRA 57) and Yusay v. Adil (164 SCRA 494) a more severe penalty.10 On the other hand, the offended parties may
apply to the instant case."8 also appeal the judgment with respect to their right to civil liability. If
the accused has the right to appeal the judgment of conviction, the
There is really only one issue. Item B above is merely an adjunct to offended parties should have the same right to appeal as much of the
Item A. judgment as is prejudicial to them.11

The Court's Ruling Appeal by the Accused Who Jumps Bail

The Petition has no merit. Well-established in our jurisdiction is the principle that the appellate
court may, upon motion or motu proprio, dismiss an appeal during its
Main Issue: pendency if the accused jumps bail. The second paragraph of Section
8 of Rule 124 of the 2000 Revised Rules of Criminal Procedure
Propriety of Appeal by the Employer provides:

Pointing out that it had seasonably filed a notice of appeal from the "The Court of Appeals may also, upon motion of the appellee
RTC Decision, petitioner contends that the judgment of conviction or motu proprio, dismiss the appeal if the appellant escapes
 from prison or confinement, jumps bail or flees to a foreign period for perfecting an appeal, or when the sentence has been
country during the pendency of the appeal."12 partially or totally satisfied or served, or when the accused has
waived in writing his right to appeal, or has applied for
This rule is based on the rationale that appellants lose their standing in probation."
court when they abscond. Unless they surrender or submit to the
court’s jurisdiction, they are deemed to have waived their right to seek In the case before us, the accused-employee has escaped and refused
judicial relief.13 to surrender to the proper authorities; thus, he is deemed to have
abandoned his appeal. Consequently, the judgment against him has
Moreover, this doctrine applies not only to the accused who jumps bail become final and executory.17
during the appeal, but also to one who does so during the trial. Justice
Florenz D. Regalado succinctly explains the principle in this wise: Liability of an Employer in a Finding of Guilt

"x x x. When, as in this case, the accused escaped after his Article 102 of the Revised Penal Code states the subsidiary civil
arraignment and during the trial, but the trial in liabilities of innkeepers, as follows:
absentia proceeded resulting in the promulgation of a
judgment against him and his counsel appealed, since he "In default of the persons criminally liable, innkeepers,
nonetheless remained at large his appeal must be dismissed by tavernkeepers, and any other persons or corporations shall be
analogy with the aforesaid provision of this Rule [Rule 124, civilly liable for crimes committed in their establishments, in
§8 of the Rules on Criminal Procedure]. x x x"14 all cases where a violation of municipal ordinances or some
general or special police regulation shall have been committed
The accused cannot be accorded the right to appeal unless they by them or their employees.
voluntarily submit to the jurisdiction of the court or are otherwise
arrested within 15 days from notice of the judgment against "Innkeepers are also subsidiary liable for restitution of goods
them. 15 While at large, they cannot seek relief from the court, as they taken by robbery or theft within their houses from guests
are deemed to have waived the appeal.16 lodging therein, or for payment of the value thereof, provided
that such guests shall have notified in advance the innkeeper
Finality of a Decision in a Criminal Case himself, or the person representing him, of the deposit of such
goods within the inn; and shall furthermore have followed the
As to when a judgment of conviction attains finality is explained in directions which such innkeeper or his representative may
Section 7 of Rule 120 of the 2000 Rules of Criminal Procedure, which have given them with respect to the care and vigilance over
we quote: such goods. No liability shall attach in case of robbery with
violence against or intimidation of persons unless committed
"A judgment of conviction may, upon motion of the accused, by the innkeeper’s employees."
be modified or set aside before it becomes final or before
appeal is perfected. Except where the death penalty is Moreover, the foregoing subsidiary liability applies to employers,
imposed, a judgment becomes final after the lapse of the according to Article 103 which reads:
 "The subsidiary liability established in the next preceding It is clear that the 2000 Rules deleted the requirement of reserving
article shall also apply to employers, teachers, persons, and independent civil actions and allowed these to proceed separately from
corporations engaged in any kind of industry for felonies criminal actions. Thus, the civil actions referred to in Articles
committed by their servants, pupils, workmen, apprentices, or 32,20 33,21 3422 and 217623 of the Civil Code shall remain "separate,
employees in the discharge of their duties." distinct and independent" of any criminal prosecution based on the
same act. Here are some direct consequences of such revision and
Having laid all these basic rules and principles, we now address the omission:
main issue raised by petitioner.
1. The right to bring the foregoing actions based on the Civil
Civil Liability Deemed Instituted in the Criminal Prosecution Code need not be reserved in the criminal prosecution, since
they are not deemed included therein.
At the outset, we must explain that the 2000 Rules of Criminal
Procedure has clarified what civil actions are deemed instituted in a 2. The institution or the waiver of the right to file a separate
criminal prosecution. civil action arising from the crime charged does not extinguish
the right to bring such action.
Section 1 of Rule 111 of the current Rules of Criminal Procedure
provides: 3. The only limitation is that the offended party cannot recover
more than once for the same act or omission. 24
"When a criminal action is instituted, the civil action for the
recovery of civil liability arising from the offense charged What is deemed instituted in every criminal prosecution is the civil
shall be deemed instituted with the criminal action unless the liability arising from the crime or delict per se (civil liability ex
offended party waives the civil action, reserves the right to delicto), but not those liabilities arising from quasi-delicts, contracts
institute it separately or institutes the civil action prior to the or quasi-contracts. In fact, even if a civil action is filed separately,
criminal action. the ex delicto civil liability in the criminal prosecution remains, and
the offended party may -- subject to the control of the prosecutor --
"x x x xxx x x x" still intervene in the criminal action, in order to protect the remaining
civil interest therein. 25
Only the civil liability of the accused arising from the crime charged
is deemed impliedly instituted in a criminal action; that is, unless the This discussion is completely in accord with the Revised Penal Code,
offended party waives the civil action, reserves the right to institute it which states that "[e]very person criminally liable for a felony is also
separately, or institutes it prior to the criminal action.18 Hence, the civilly liable."26
subsidiary civil liability of the employer under Article 103 of the
Revised Penal Code may be enforced by execution on the basis of the Petitioner argues that, as an employer, it is considered a party to the
judgment of conviction meted out to the employee. 19 criminal case and is conclusively bound by the outcome thereof.
Consequently, petitioner must be accorded the right to pursue the case
to its logical conclusion -- including the appeal.
The argument has no merit. Undisputedly, petitioner is not a direct courts have the power to reverse, affirm or modify the judgment of the
party to the criminal case, which was filed solely against Napoleon M. lower court and to increase or reduce the penalty it imposed. 34
Roman, its employee.
If the present appeal is given course, the whole case against the
In its Memorandum, petitioner cited a comprehensive list of cases accused-employee becomes open to review. It thus follows that a
dealing with the subsidiary liability of employers. Thereafter, it noted penalty higher than that which has already been imposed by the trial
that none can be applied to it, because "in all th[o]se cases, the court may be meted out to him. Petitioner’s appeal would thus violate
accused’s employer did not interpose an appeal."27 Indeed, petitioner his right against double jeopardy, since the judgment against him
cannot cite any single case in which the employer appealed, precisely could become subject to modification without his consent.
because an appeal in such circumstances is not possible.
We are not in a position to second-guess the reason why the accused
The cases dealing with the subsidiary liability of employers uniformly effectively waived his right to appeal by jumping bail. It is clear,
declare that, strictly speaking, they are not parties to the criminal cases though, that petitioner may not appeal without violating his right
instituted against their employees.28 Although in substance and in against double jeopardy.
effect, they have an interest therein, this fact should be viewed in the
light of their subsidiary liability. While they may assist their Effect of Absconding on the Appeal Process
employees to the extent of supplying the latter’s lawyers, as in the
present case, the former cannot act independently on their own behalf, Moreover, within the meaning of the principles governing the
but can only defend the accused. prevailing criminal procedure, the accused impliedly withdrew his
appeal by jumping bail and thereby made the judgment of the court
Waiver of Constitutional Safeguard Against Double Jeopardy below final.35 Having been a fugitive from justice for a long period of
time, he is deemed to have waived his right to appeal. Thus, his
Petitioner’s appeal obviously aims to have the accused-employee conviction is now final and executory. The Court in People v. Ang
absolved of his criminal responsibility and the judgment reviewed as Gioc36 ruled:
a whole. These intentions are apparent from its Appellant’s
Brief29 filed with the CA and from its Petition30 before us, both of "There are certain fundamental rights which cannot be waived
which claim that the trial court’s finding of guilt "is not supported by even by the accused himself, but the right of appeal is not one
competent evidence."31 of them. This right is granted solely for the benefit of the
accused. He may avail of it or not, as he pleases. He may
An appeal from the sentence of the trial court implies a waiver of the waive it either expressly or by implication. When the accused
constitutional safeguard against double jeopardy and throws the whole flees after the case has been submitted to the court for
case open to a review by the appellate court. The latter is then called decision, he will be deemed to have waived his right to appeal
upon to render judgment as law and justice dictate, whether favorable from the judgment rendered against him. x x x."37
or unfavorable to the appellant.32 This is the risk involved when the
accused decides to appeal a sentence of conviction.33 Indeed, appellate By fleeing, the herein accused exhibited contempt of the authority of
the court and placed himself in a position to speculate on his chances
for a reversal. In the process, he kept himself out of the reach of justice, court need not expressly pronounce the subsidiary liability of the
but hoped to render the judgment nugatory at his option.38 Such employer.
conduct is intolerable and does not invite leniency on the part of the
appellate court.39 In the absence of any collusion between the accused-employee and the
offended party, the judgment of conviction should bind the person
Consequently, the judgment against an appellant who escapes and who is subsidiarily liable.46 In effect and implication, the stigma of a
who refuses to surrender to the proper authorities becomes final and criminal conviction surpasses mere civil liability.47
executory.40
To allow employers to dispute the civil liability fixed in a criminal
Thus far, we have clarified that petitioner has no right to appeal the case would enable them to amend, nullify or defeat a final judgment
criminal case against the accused-employee; that by jumping bail, he rendered by a competent court.48 By the same token, to allow them to
has waived his right to appeal; and that the judgment in the criminal appeal the final criminal conviction of their employees without the
case against him is now final. latter’s consent would also result in improperly amending, nullifying
or defeating the judgment.
Subsidiary Liability Upon Finality of Judgment
The decision convicting an employee in a criminal case is binding and
As a matter of law, the subsidiary liability of petitioner now accrues. conclusive upon the employer not only with regard to the former’s
Petitioner argues that the rulings of this Court in Miranda v. Malate civil liability, but also with regard to its amount. The liability of an
Garage & Taxicab, Inc.,41 Alvarez v. CA42 and Yusay v. Adil43 do not employer cannot be separated from that of the employee. 49
apply to the present case, because it has followed the Court’s directive
to the employers in these cases to take part in the criminal cases against Before the employers’ subsidiary liability is exacted, however, there
their employees. By participating in the defense of its employee, must be adequate evidence establishing that (1) they are indeed the
herein petitioner tries to shield itself from the undisputed rulings laid employers of the convicted employees; (2) that the former are engaged
down in these leading cases. in some kind of industry; (3) that the crime was committed by the
employees in the discharge of their duties; and (4) that the execution
Such posturing is untenable. In dissecting these cases on subsidiary against the latter has not been satisfied due to insolvency. 50
liability, petitioner lost track of the most basic tenet they have laid
down -- that an employer’s liability in a finding of guilt against its The resolution of these issues need not be done in a separate civil
accused-employee is subsidiary. action. But the determination must be based on the evidence that the
offended party and the employer may fully and freely present. Such
Under Article 103 of the Revised Penal Code, employers are determination may be done in the same criminal action in which the
subsidiarily liable for the adjudicated civil liabilities of their employee’s liability, criminal and civil, has been pronounced; 51 and in
employees in the event of the latter’s insolvency. 44 The provisions of a hearing set for that precise purpose, with due notice to the employer,
the Revised Penal Code on subsidiary liability -- Articles 102 and 103 as part of the proceedings for the execution of the judgment.
-- are deemed written into the judgments in the cases to which they are
applicable.45 Thus, in the dispositive portion of its decision, the trial
Just because the present petitioner participated in the defense of its out not only his primary civil liability, but also his employer’s
accused-employee does not mean that its liability has transformed its subsidiary liability for his criminal negligence.52
nature; its liability remains subsidiary. Neither will its participation
erase its subsidiary liability. The fact remains that since the accused- It should be stressed that the right to appeal is neither a natural right
employee’s conviction has attained finality, then the subsidiary nor a part of due process.53 It is merely a procedural remedy of
liability of the employer ipso facto attaches. statutory origin, a remedy that may be exercised only in the manner
prescribed by the provisions of law authorizing such
According to the argument of petitioner, fairness dictates that while exercise.54 Hence, the legal requirements must be strictly complied
the finality of conviction could be the proper sanction to be imposed with. 55
upon the accused for jumping bail, the same sanction should not affect
it. In effect, petitioner-employer splits this case into two: first, for It would be incorrect to consider the requirements of the rules on
itself; and second, for its accused-employee. appeal as merely harmless and trivial technicalities that can be
discarded.56 Indeed, deviations from the rules cannot be tolerated.57 In
The untenability of this argument is clearly evident. There is only one these times when court dockets are clogged with numerous litigations,
criminal case against the accused-employee. A finding of guilt has such rules have to be followed by parties with greater fidelity, so as to
both criminal and civil aspects. It is the height of absurdity for this facilitate the orderly disposition of those cases.58
single case to be final as to the accused who jumped bail, but not as to
an entity whose liability is dependent upon the conviction of the After a judgment has become final, vested rights are acquired by the
former. winning party. If the proper losing party has the right to file an appeal
within the prescribed period, then the former has the correlative right
The subsidiary liability of petitioner is incidental to and dependent on to enjoy the finality of the resolution of the case. 59
the pecuniary civil liability of the accused-employee. Since the civil
liability of the latter has become final and enforceable by reason of his In fact, petitioner admits that by helping the accused-employee, it
flight, then the former’s subsidiary civil liability has also become participated in the proceedings before the RTC; thus, it cannot be said
immediately enforceable. Respondent is correct in arguing that the that the employer was deprived of due process. It might have lost its
concept of subsidiary liability is highly contingent on the imposition right to appeal, but it was not denied its day in court. 60 In fact, it can
of the primary civil liability. be said that by jumping bail, the accused-employee, not the court,
deprived petitioner of the right to appeal.
No Deprivation of Due Process
All told, what is left to be done is to execute the RTC Decision against
As to the argument that petitioner was deprived of due process, we the accused. It should be clear that only after proof of his insolvency
reiterate that what is sought to be enforced is the subsidiary civil may the subsidiary liability of petitioner be enforced. It has been
liability incident to and dependent upon the employee’s criminal sufficiently proven that there exists an employer-employee
negligence. In other words, the employer becomes ipso relationship; that the employer is engaged in some kind of industry;
facto subsidiarily liable upon the conviction of the employee and upon and that the employee has been adjudged guilty of the wrongful act
proof of the latter’s insolvency, in the same way that acquittal wipes and found to have committed the offense in the discharge of his duties.
The proof is clear from the admissions of petitioner that "[o]n 26
August 1990, while on its regular trip from Laoag to Manila, a
passenger bus owned by petitioner, being then operated by
petitioner’s driver, Napoleon Roman, figured in an accident in San
Juan, La Union x x x."61 Neither does petitioner dispute that there was
already a finding of guilt against the accused while he was in the
discharge of his duties.

WHEREFORE, the Petition is hereby DENIED, and the assailed

Resolutions AFFIRMED. Costs against petitioner.

SO ORDERED.
G.R. No. 107125 January 29, 2001 without due regard to traffic laws, regulations and ordinances
and without taking the necessary precaution to prevent
GEORGE MANANTAN, petitioner, accident to person and damage to property, causing by such
vs. negligence, carelessness and imprudence said automobile
THE COURT OF APPEALS, SPOUSES MARCELINO driven and operated by him to sideswipe a passenger jeep
NICOLAS and MARIA NICOLAS, respondents. bearing plate No. 918-7F driven by Charles Codamon,
thereby causing the said automobile to turn down (sic)
QUISUMBING, J.: resulting to the death of Ruben Nicolas a passenger of said
automobile.
This is a petition for review of the decision dated January 31, 1992 of
the Court of Appeals in CA-G.R. CV No. 19240, modifying the CONTRARY TO LAW.1
judgment of the Regional Trial Court of Santiago, Isabela, Branch 21,
in Criminal Case No. 066. Petitioner George Manantan was acquitted On arraignment, petitioner pleaded not guilty to the charge. Trial on
by the trial court of homicide through reckless imprudence without a the merits ensued.
ruling on his civil liability. On appeal from the civil aspect of the
judgment in Criminal Case No. 066, the appellate court found The prosecution's evidence, as summarized by the trial court and
petitioner Manantan civilly liable and ordered him to indemnify adopted by the appellate court, showed that:
private respondents Marcelino Nicolas and Maria Nicolas
P104,400.00 representing loss of support, P50,000.00 as death [I]n the morning of September 25, 1982, Fiscal Wilfredo
indemnity, and moral damages of P20,000.00 or a total of P174,400.00 Ambrocio… decided to catch shrimps at the irrigation canal
for the death of their son, Ruben Nicolas. at his farm. He invited the deceased who told him that they
(should) borrow the Ford Fiera of the accused George
The facts of this case are as follows: Manantan who is also from Cordon. The deceased went to
borrow the Ford Fiera but…said that the accused also wanted
On June 1, 1983, the Provincial Fiscal of Isabela filed an information to (come) along. So Fiscal Ambrocio and the deceased
charging petitioner Manantan with reckless imprudence resulting in dropped by the accused at the Manantan Technical School.
homicide, allegedly committed as follows: They drank beer there before they proceeded to the farm using
the Toyota Starlet of the accused. At the farm they consumed
That on or about the 25th day of September 1982, in the one (more) case of beer. At about 12:00 o'clock noon they
municipality of Santiago, province of Isabela, Philippines, went home. Then at about 2:00 or 3:00 o'clock that afternoon,
and within the jurisdiction of this Honorable Court, the said (defense witness Miguel) Tagangin and (Ruben) Nicolas and
accused, being then the driver and person-in-charge of an the accused returned to the house of Fiscal Ambrocio with a
automobile bearing Plate No. NGA-816, willfully and duck. They cooked the duck and ate the same with one more
unlawfully drove and operated the same while along case of beer. They ate and drank until about 8:30 in the
the Daang Maharlika at Barangay Malvar, in said evening when the accused invited them to go bowling. They
municipality, in a negligent, careless and imprudent manner, went to Santiago, Isabela on board the Toyota Starlet of the
accused who drove the same. They went to the Vicap Bowling his belly with the deceased on top of him. Ambrocio pushed
Lanes at Mabini, Santiago, Isabela but unfortunately there (away) the deceased and then he was pulled out of the car by
was no vacant alley. While waiting for a vacant alley they Tabangin. Afterwards, the deceased who was still
drank one beer each. After waiting for about 40 minutes and unconscious was pulled out from the car. Both Fiscal
still no alley became vacant the accused invited his Ambrocio and the deceased were brought to the Flores Clinic.
companions to go to the LBC Night Club. They had drinks The deceased died that night (Exhibit "B") while Ambrocio
and took some lady partners at the LBC. After one hour, they suffered only minor injuries to his head and legs.2
left the LBC and proceeded to a nearby store where they
ate arroz caldo…and then they decided to go home. Again the The defense version as to the events prior to the incident was
accused drove the car. Miguel Tabangin sat with the accused essentially the same as that of the prosecution, except that defense
in the front seat while the deceased and Fiscal Ambrocio sat witness Miguel Tabangin declared that Manantan did not drink beer
at the back seat with the deceased immediately behind the that night. As to the accident, the defense claimed that:
accused. The accused was driving at a speed of about 40
kilometers per hour along the Maharlika Highway at Malvar, …The accused was driving slowly at the right lane [at] about
Santiago, Isabela, at the middle portion of the highway 20 inches from the center of the road at about 30 kilometers
(although according to Charles Cudamon, the car was running per hour at the National Highway at Malvar, Santiago, Isabela,
at a speed of 80 to 90 kilometers per hours on [the] wrong lane when suddenly a passenger jeepney with bright lights which
of the highway because the car was overtaking a tricycle) was coming from the opposite direction and running very fast
when they met a passenger jeepney with bright lights on. The suddenly swerve(d) to the car's lane and bumped the car which
accused immediately tried to swerve the car to the right and turned turtle twice and rested on its top at the right edge of the
move his body away from the steering wheel but he was not road while the jeep stopped across the center of the road as
able to avoid the oncoming vehicle and the two vehicles shown by a picture taken after the incident (Exhibit "1") and
collided with each other at the center of the road. a sketch (Exhibit "3") drawn by the accused during his rebuttal
testimony. The car was hit on the driver's side. As a result of
xxx the collision, the accused and Miguel Tabangin and Fiscal
Ambrocio were injured while Ruben Nicolas died at the
As a result of the collision the car turned turtle twice and Flores Clinic where they were all brought for treatment. 3
landed on its top at the side of the highway immediately at the
approach of the street going to the Flores Clinic while the jeep In its decision dated June 30, 1988, promulgated on August 4, 1988,
swerved across the road so that one half front portion landed the trial court decided Criminal Case No. 066 in petitioner's favor,
on the lane of the car while the back half portion was at its thus:
right lane five meters away from the point of impact as shown
by a sketch (Exhibit "A") prepared by Cudamon the following WHEREFORE, in the light of the foregoing considerations,
morning at the Police Headquarters at the instance of his the Court finds the accused NOT GUILTY of the crime
lawyer. Fiscal Ambrocio lost consciousness. When he charged and hereby acquits him.
regained consciousness he was still inside the car (lying) on
 SO ORDERED.4 Hence, the present case. Petitioner, in his memorandum, submits the
following issues for our consideration:
On August 8, 1988, private respondents filed their notice of appeal on
the civil aspect of the trial court's judgment. In their appeal, docketed FIRST – THE DECISION OF THE TRIAL COURT
as CA-G.R. CV No. 19240, the Nicolas spouses prayed that the ACQUITTING THE PETITIONER OF THE CRIME OF
decision appealed from be modified and that appellee be ordered to RECKLESS IMPRUDENCE RESULTING TO HOMICIDE
pay indemnity and damages. FORECLOSED ANY FURTHER INQUIRY ON THE
ACCUSED'S (PETITIONER'S) NEGLIGENCE OR
On January 31, 1992, the appellate court decided CA-G.R. CV No. RECKLESS IMPRUDENCE BECAUSE BY THEN HE
19240 in favor of the Nicolas spouses, thus: WILL BE PLACED IN "DOUBLE JEOPARDY" AND
THEREFORE THE COURT OF APPEALS ERRED IN
WHEREFORE, the decision appealed from is MODIFIED in PASSING UPON THE SAME ISSUE AGAIN.
that defendant-appellee is hereby held civilly liable for his
negligent and reckless act of driving his car which was the SECOND – THE COURT OF APPEALS DID NOT HAVE
proximate cause of the vehicular accident, and sentenced to JURISDICTION TO AWARD DAMAGES AND
indemnify plaintiffs-appellants in the amount of P174,400.00 INDEMNITY TO THE PRIVATE RESPONDENTS
for the death of Ruben Nicolas, CONSIDERING THAT THE NON-DECLARATION OF
ANY INDEMNITY OR AWARD OF DAMAGES BY THE
SO ORDERED.5 REGIONAL TRIAL COURT OF ISABELA, BRANCH XXI,
WAS ITSELF CONSISTENT WITH THE PETITIONER'S
In finding petitioner civilly liable, the court a quo noted that at the ACQUITTAL FOR THE REASON THAT THE CIVIL
time the accident occurred, Manantan was in a state of intoxication, ACTION WAS IMPLIEDLY INSTITUTED WITH THE
due to his having consumed "all in all, a total of at least twelve (12) CRIMINAL ACTION AND THERE WAS NO EXPRESS
bottles of beer…between 9 a.m. and 11 p.m."6 It found that petitioner's WAIVER OF THE CIVIL ACTION OR RESERVATION
act of driving while intoxicated was a clear violation of Section 53 of TO INSTITUTE IT SEPARATELY BY THE PRIVATE
the Land Transportation and Traffic Code (R.A. No. 4136)7 and RESPONDENTS IN THE TRIAL COURT.
pursuant to Article 2185 of the Civil Code, 8 a statutory presumption
of negligence existed. It held that petitioner's act of violating the THIRD – THE COURT OF APPEALS DID NOT HAVE
Traffic Code is negligence in itself "because the mishap, which JURISDICTION TO TAKE COGNIZANCE OF THE CASE
occurred, was the precise injury sought to be prevented by the CA-G.R. CV No. 19240 ENTITLED: SPOUSES
regulation."9 MARCELINO NICOLAS AND MARIA NICOLAS v. GEORGE
MANANTAN, AND RENDER THE DECISION SOUGHT
Petitioner moved for reconsideration, but the appellate court in its TO BE REVIEWED WHEN THE SAME WAS
resolution of August 24, 1992 denied the motion. PROSECUTED BY THE PRIVATE RESPONDENTS IN
THEIR PERSONAL CAPACITIES AND THE FILING
 FEES NOT HAVING BEEN PAID, THUS VIOLATING the same offense. If an act is punished by a law and an ordinance,
THE MANCHESTER DOCTRINE. conviction or acquittal under either shall constitute a bar to another
prosecution for the same act."10 When a person is charged with an
In brief, the issues for our resolution are: offense and the case is terminated either by acquittal or conviction or
in any other manner without the consent of the accused, the latter
(1) Did the acquittal of petitioner foreclose any further inquiry cannot again be charged with the same or identical offense. 11 This is
by the Court of Appeals as to his negligence or reckless double jeopardy. For double jeopardy to exist, the following elements
imprudence? must be established: (a) a first jeopardy must have attached prior to
the second; (2) the first jeopardy must have terminated; and (3) the
(2) Did the court a quo err in finding that petitioner's acquittal second jeopardy must be for the same offense as the first. 12 In the
did not extinguish his civil liability? instant case, petitioner had once been placed in jeopardy by the filing
of Criminal Case No. 066 and the jeopardy was terminated by his
(3) Did the appellate court commit a reversible error in failing discharge. The judgment of acquittal became immediately final. Note,
however, that what was elevated to the Court of Appeals by private
to apply the Manchester doctrine to CA-G.R. CV No. 19240?
respondents was the civil aspect of Criminal Case No. 066. Petitioner
was not charged anew in CA-G.R. CV No. 19240 with a second
On the first issue, petitioner opines that the Court of Appeals should
criminal offense identical to the first offense. The records clearly show
not have disturbed the findings of the trial court on the lack of
that no second criminal offense was being imputed to petitioner on
negligence or reckless imprudence under the guise of determining his
appeal. In modifying the lower court's judgment, the appellate court
civil liability. He argues that the trial court's finding that he was neither
did not modify the judgment of acquittal. Nor did it order the filing of
imprudent nor negligent was the basis for his acquittal, and not
a second criminal case against petitioner for the same offense.
reasonable doubt. He submits that in finding him liable for indemnity
Obviously, therefore, there was no second jeopardy to speak of.
and damages, the appellate court not only placed his acquittal in
Petitioner's claim of having been placed in double jeopardy is
suspicion, but also put him in "double jeopardy."
incorrect.
Private respondents contend that while the trial court found that
Our law recognizes two kinds of acquittal, with different effects on the
petitioner's guilt had not been proven beyond reasonable doubt, it did
civil liability of the accused. First is an acquittal on the ground that the
not state in clear and unequivocal terms that petitioner was not
accused is not the author of the act or omission complained of. This
recklessly imprudent or negligent. Hence, impliedly the trial court
instance closes the door to civil liability, for a person who has been
acquitted him on reasonable doubt. Since civil liability is not
found to be not the perpetrator of any act or omission cannot and can
extinguished in criminal cases, if the acquittal is based on reasonable
never be held liable for such act or omission.13 There being no delict,
doubt, the Court of Appeals had to review the findings of the trial court
civil liability ex delicto is out of the question, and the civil action, if
to determine if there was a basis for awarding indemnity and damages.
any, which may be instituted must be based on grounds other than
the delict complained of. This is the situation contemplated in Rule
Preliminarily, petitioner's claim that the decision of the appellate court 111 of the Rules of Court.14 The second instance is an acquittal based
awarding indemnity placed him in double jeopardy is misplaced. The on reasonable doubt on the guilt of the accused. In this case, even if
constitution provides that "no person shall be twice put in jeopardy for
the guilt of the accused has not been satisfactorily established, he is of the accused presented itself before the Court" and since said
not exempt from civil liability which may be proved by preponderance "hypothesis is consistent with the record…the Court's mind cannot
of evidence only. 15 This is the situation contemplated in Article 29 of rest on a verdict of conviction."18 The foregoing clearly shows that
the Civil Code,16 where the civil action for damages is "for the same petitioner's acquittal was predicated on the conclusion that his guilt
act or omission." Although the two actions have different purposes, had not been established with moral certainty. Stated differently, it is
the matters discussed in the civil case are similar to those discussed in an acquittal based on reasonable doubt and a suit to enforce civil
the criminal case. However, the judgment in the criminal proceeding liability for the same act or omission lies.
cannot be read in evidence in the civil action to establish any fact there
determined, even though both actions involve the same act or On the third issue, petitioner argues that the Court of Appeals erred in
omission.17 The reason for this rule is that the parties are not the same awarding damages and indemnity, since private respondents did not
and secondarily, different rules of evidence are applicable. Hence, pay the corresponding filing fees for their claims for damages when
notwithstanding herein petitioner's acquittal, the Court of Appeals in the civil case was impliedly instituted with the criminal action.
determining whether Article 29 applied, was not precluded from Petitioner submits that the non-payment of filing fees on the amount
looking into the question of petitioner's negligence or reckless of the claim for damages violated the doctrine in Manchester
imprudence. Development Corporation v. Court of Appeals, 149 SCRA 562 (1987)
and Supreme Court Circular No. 7 dated March 24, 1988.19 He avers
On the second issue, petitioner insists that he was acquitted on a that since Manchester held that "The Court acquires jurisdiction over
finding that he was neither criminally negligent nor recklessly any case only upon payment of the prescribed docket fees," the
imprudent. Inasmuch as his civil liability is predicated on the criminal appellate court was without jurisdiction to hear and try CA-G.R. CV
offense, he argues that when the latter is not proved, civil liability No. 19240, much less award indemnity and damages.
cannot be demanded. He concludes that his acquittal bars any civil
action. Private respondents argue that the Manchester doctrine is inapplicable
to the instant case. They ask us to note that the criminal case, with
Private respondents counter that a closer look at the trial court's which the civil case was impliedly instituted, was filed on July 1,
judgment shows that the judgment of acquittal did not clearly and 1983, while the Manchester requirements as to docket and filing fees
categorically declare the non-existence of petitioner's negligence or took effect only with the promulgation of Supreme Court Circular No.
imprudence. Hence, they argue that his acquittal must be deemed 7 on March 24, 1988. Moreover, the information filed by the
based on reasonable doubt, allowing Article 29 of the Civil Code to Provincial Prosecutor of Isabela did not allege the amount of
come into play. indemnity to be paid. Since it was not then customarily or legally
required that the civil damages sought be stated in the information, the
Our scrutiny of the lower court's decision in Criminal Case No. 066 trial court had no basis in assessing the filing fees and demanding
supports the conclusion of the appellate court that the acquittal was payment thereof. Moreover, assuming that the Manchester ruling is
based on reasonable doubt; hence, petitioner's civil liability was not applied retroactively, under the Rules of Court, the filing fees for the
extinguished by his discharge. We note the trial court's declaration that damages awarded are a first lien on the judgment. Hence, there is no
did not discount the possibility that "the accused was really negligent." violation of the Manchester doctrine to speak of.
However, it found that "a hypothesis inconsistent with the negligence
At the time of the filing of the information in 1983, the implied guarantee that the filing fees for the award of damages are a first lien
institution of civil actions with criminal actions was governed by Rule on the judgment, the effect of the enforcement of said lien must
111, Section 1 of the 1964 Rules of Court.20 As correctly pointed out retroact to the institution of the criminal action. The filing fees are
by private respondents, under said rule, it was not required that the deemed paid from the filing of the criminal complaint or information.
damages sought by the offended party be stated in the complaint or We therefore find no basis for petitioner's allegations that the filing
information. With the adoption of the 1985 Rules of Criminal fees were not paid or improperly paid and that the appellate court
Procedure, and the amendment of Rule 111, Section 1 of the 1985 acquired no jurisdiction.
Rules of Criminal Procedure by a resolution of this Court dated July
7, 1988, it is now required that: WHEREFORE, the instant petition is DISMISSED for lack of merit.
The assailed decision of the Court of Appeals in CA-G.R. CV No.
When the offended party seeks to enforce civil liability 19240 promulgated on January 31, 1992, as well as its resolution dated
against the accused by way of moral, nominal, temperate or August 24, 1992, denying herein petitioner's motion for
exemplary damages, the filing fees for such civil action as reconsideration, are AFFIRMED. Costs against petitioner.
provided in these Rules shall constitute a first lien on the
judgment except in an award for actual damages.

In cases wherein the amount of damages, other than actual, is

alleged in the complaint or information, the corresponding
filing fees shall be paid by the offended party upon the filing
thereof in court for trial.

The foregoing were the applicable provisions of the Rules of Criminal

Procedure at the time private respondents appealed the civil aspect of
Criminal Case No. 066 to the court a quo in 1989. Being in the nature
of a curative statute, the amendment applies retroactively and affects
pending actions as in this case.

Thus, where the civil action is impliedly instituted together with the
criminal action, the actual damages claimed by the offended parties,
as in this case, are not included in the computation of the filing fees.
Filing fees are to be paid only if other items of damages such as moral,
nominal, temporate, or exemplary damages are alleged in the
complaint or information, or if they are not so alleged, shall constitute
a first lien on the judgment.21 Recall that the information in Criminal
Case No. 066 contained no specific allegations of damages.
Considering that the Rules of Criminal Procedure effectively
G.R. No. 155309 November 15, 2005 The assailed Resolution denied reconsideration.

JOSEPHINE M. SANCHEZ, Petitioner, The Facts

vs.
FAR EAST BANK AND TRUST COMPANY,1 Respondent. The antecedents of the case are related by the CA as follows:

DECISION "It is undisputed that Kai J. Chin was the director and representative
of Chemical Bank. Its subsidiary, the Chemical International Finance
PANGANIBAN, J.: Limited (CIFL), was an investor in [Respondent] Far East Bank and
Trust [C]ompany (FEBTC), x x x. In representing the interest of CIFL
t bottom, the resolution of this case hinges on the credibility of the in FEBTC, Chin was made a director and sr. vice president of FEBTC.
witnesses and their testimonies. Since the factual findings of the lower [Petitioner] Josephine Sanchez was, in turn, assigned as secretary of
courts are disparate, this Court painstakingly Chin. CIFL also maintained a checking account (CA# 0009-04212-1)
reviewed the records. It found no sufficient reason to disbelieve the in FEBTC’s investment arm, the Far East Bank Investment, Inc.
well-explained findings and equally logical conclusions of the trial (FEBII). Chin was one of the authorized signatories in the said current
court. The evidence proffered by respondent even corroborated and money market accounts.
relevant portions of those of petitioner. Thus, the evidence supported
the ruling of the trial court that the acquittal of petitioner was based on "According to [respondent], [petitioner] made unauthorized
its reasonable finding that she had not committed the crime imputed withdrawals from the account of CIFL in FEBTC through the use of
to her. Consequently, she incurred no civil liability for the alleged forged or falsified applications for cashier’s checks which were
offense. deposited to her personal accounts. Once credited to her account, she
withdrew the amounts and misappropriated, misapplied and converted
The Case them to her personal benefit and advantage, to the damage of FEBTC.

Before us is a Petition for Review2 under Rule 45 of the Rules of "[Petitioner supposedly] employed three modes in the said fraudulent
Court, seeking to reverse the July 31, 2001 Decision3 and the August transactions, namely:
30, 2002 Resolution4 of the Court of Appeals (CA) in CA-GR CV No.
53715. The challenged Decision disposed as follows: "In the First Mode, [petitioner] caused the issuance of a cashier’s
check payable to ‘bearer’ with number 461390, dated September 29,
"WHEREFORE, the assailed order is REVERSED and SET ASIDE. 1992, in the sum of ₱250,040.86. This is the subject of Crim. Case No.
[Petitioner] JOSEPHINE SANCHEZ is hereby ordered to pay 93-126175. She presented a forged letter of confirmation bearing the
[Respondent] Far East Bank and Trust Company, the amount of One forged signature of Chin addressed to Beatriz Bagsit, Cash
Million One Hundred Eighty Seven Thousand Five Hundred Thirty Department Head of FEBTC. This check was paid pursuant to the said
Pesos and Eighty Six Centavos (₱1,187,530.86) as actual damages. confirmation. [Petitioner] immediately deposited this check to her
This is without prejudice to [petitioner]’s recourse of reimbursement FEBTC Savings Account No. 0101-39109-9 and on September 30,
from the other persons who participated in the transactions."5 1992, she withdrew ₱200,040.86.
"Under the Second Mode, [petitioner] filed applications forms to "In this mode, 16 checks were issued, to wit:
purchase cashier’s checks payable to her, [with] Chin as the supposed
purchaser. Said applications were accompanied by a forged Check No. Date Amount Exhibit
memorandum of Chin confirming [petitioner] as the payee-
beneficiary. After the approval by Bagsit of the applications and 461417 10/13/92 P100,000.00 ‘K’
memoranda, checks were issued, as follows:
461488 10/20/92 150,000.00 ‘L’
462197 11/17/92 50,000.00 ‘M’
Check No. Date Amount Exhibit
461318 11/26/92 190,000.00 ‘N’
461739 10/22/92 ₱489,450.00 ‘F’ 462420 12/09/92 200,400.00 ‘O’
462482 12/12/92 220,000.00 ‘P’
461963 04/11/92 160,550.00 ‘G’ 462717 01/04/93 210,000.00 ‘Q’
462946 01/18/93 200,000.00 ‘R’
464801 05/24/93 180,090.00 ‘H’ 463241 02/01/93 180,000.00 ‘S’
463606 02/26/93 180,000.00 ‘T’
465405 06/30/93 107,400.00 ‘I’ 463776 03/08/93 200,000.00 ‘U’
463850 03/19/93 200,000.00 ‘V’
"In compliance with bank procedures [petitioner] signs the checks 464108 04/01/93 150,000.00 ‘W’
twice, one as an endorsement and two as proof of receipt of the 464329 04/20/93 100,000.00 ‘X’
proceeds which she then deposited to her FEBTC account. 464432 04/27/93 150,000.00 ‘Y’
464620 05/13/93 150,000.00 ‘Z’
"The Third Mode, was frequently used which involved checks
payable to Chin.
"[Petitioner allegedly] confessed to Chin that she tampered with the
CIFL account. Chin referred the matter to the FEBTC’s audit division
"[Petitioner] was designated as Chin’s representative to purchase
for further investigation. All the cashier’s checks, funded by an
cashier’s checks using applications which bore forged signatures of
unauthorized debit against the CIFL account, as well as the
Chin as a purchaser and the payee.
corresponding applications for their issuance were examined at the
Philippine National Police Crime Laboratory. All of Chin’s signatures
"After Bagsit has approved the application and has checked the borne on all the checks and applications were found to have been good
authenticity of Chin’s signatures, a cashier’s check is issued. Then forgeries. With the damage done, FEBTC had to reimburse the CIFL
[petitioner] claimed the check, left then came back soon to encash it. account and ultimately suffered the total misappropriated amount of
The check when presented for encashment already had two signatures ₱3,787,530.86."6
of Chin on its dorsal side, both signatures being forged. The first
forged signature represents Chin’s endorsement of the check as payee
The main defense of petitioner consisted of a denial of the forgeries.
and the second, Chin’s purported receipt of the check’s proceeds. The
She asserted that she had deposited the checks to her account, under
teller pays the value of the check only if initialed by Bagsit.
the authority and instructions of Kai Chin. Afterwards, petitioner Subsequently, respondent filed a Motion for Reconsideration of the
withdrew the amounts and gave them to him. 7 civil aspect of the RTC Decision. In an Order 12 dated March 20, 1996,
the trial court denied reconsideration. Quoting portions of its Decision,
Kai Chin denied that he had given that authority to her, and insisted the RTC said in its Order that the acquittal of the accused "was not
that she had signed the subject documents. However, he did not rebut exactly on the ground of ‘reasonable doubt,’ but that she was not the
her testimony that she had turned over the proceeds of the checks to author of the frauds allegedly perfpetrated (sic)." Thus, it held that "no
him. civil liability against her may properly be made."

Ruling of the Trial Court

The Regional Trial Court (RTC) did not find Kai Chin to be a credible Ruling of the Court of Appeals
witness. According to the RTC, FEBTC’s records showed that,
contrary to his testimony, he had expressly authorized petitioner to Granting respondent’s appeal, the appellate court ruled that the trial
transact matters concerning Chemical Bank’s account.8 court’s judgment of acquittal did not preclude recovery of civil
indemnity based on a quasi delict.13 The CA held that the outcome of
The trial judge doubted the integrity of the findings and the report of the criminal case, whether conviction or acquittal, was
the PNP handwriting expert. He noted the nonuse during the inconsequential in adjudging civil liability arising from the same act
handwriting analysis of Kai Chin’s contemporaneous signatures. that could also be considered a quasi delict. Moreover, FEBTC did not
Besides, the examination was initiated unilaterally by FEBTC have to reserve its right to file a separate civil action for damages,
officials, who had submitted sample signatures of their own choice. 9 because the law had already made that reservation on respondent’s
behalf. 14
The RTC added that the allegedly fraudulent transactions had occurred
from September 1992 to June 1993, with the use of The CA further held that, contrary to the trial court’s clarifications in
documents bearing the signatures of other officials and employees of its March 20, 1996 Order, petitioner had been acquitted merely on
respondent. In other words, all the questioned transactions had been reasonable doubt arising from insufficiency of evidence to establish
approved and allowed by the bank officials concerned, despite her identity as perpetrator of the crime. Her acquittal was not due to
apparent procedural infirmities.10 Yet, only petitioner was indicted. the nonexistence of the crime for which civil liability could
arise.15 Although it agreed with the RTC that forgery
Thus, the RTC disposed as follows: had not been satisfactorily proven by FEBTC, the CA nonetheless
found petitioner liable for her failure to turn over to respondent the
"FOR ALL THE FOREGOING CONSIDERATIONS, the Court finds proceeds of the checks. The failure supposedly constituted an
and so holds that the prosecution failed to prove the culpability of the actionable fraud.16
accused in any of these cases with moral certainty, and consequently
acquits her from all the charges, with costs de oficio. Her bail bonds Thus, the appellate court ordered petitioner to pay respondent
are released and the hold departure order as well as the order of ₱1,187,530.86 as actual damages, representing the value of the checks
attachment are lifted."11 that had been paid in her name and to her account. 17
Hence, this Petition.18 months after, on February 14, 1996, petitioner instantly concludes that
the Motion was filed out of time.
The Issues
Respondent, however, contends that the time for filing the Motion
Petitioner raises the following issues for this Court’s consideration: should be counted from February 1, 1996 -- when it received
the trial court’s Decision -- not from the date of notice to the public
"(1) Whether the judgment of conviction had already become final at prosecutor.20 To determine the period for filing from the latter date
the time the motion for reconsideration of the civil aspect was filed by would undermine the dual aspects of a criminal litigation, in which the
the complainant-appellant? right of the offended party to appeal the civil aspect is independent of
the decision of the accused on whether or not to appeal the case. 21
"(2) Whether an appeal on the civil aspect may be made from a
decision in a criminal case acquitting the accused for being not the We uphold respondent on this issue. Section 6 of Rule 122 of the Rules
author of the crime? of Court states as follows:

"(3) Whether a separate civil action is necessary to be instituted after "SEC. 6. When appeal to be taken. – An appeal must be taken within
the accused is acquitted in a criminal case based on reasonable doubt? fifteen (15) days from promulgation of the judgment or from notice of
the final order appealed from. This period for perfecting an appeal
"(4) Whether the civil aspect of the criminal offenses where the shall be suspended from the time a motion for new trial or
accused was acquitted may be pursued by a party other than the reconsideration is filed until notice of the order overruling the motion
offended parties? Otherwise stated, whether the civil liability may be has been served upon the accused or his counsel at which time the
pursued by a party which is not a real party in interest after the balance of the period begins to run."22
acquittal of the accused of the offenses charged?"19
Clearly, the period available to the accused for filing an appeal is
The Court’s Ruling fifteen (15) days from the promulgation of the judgment or from notice
of the final order appealed from. As early as Landicho v. Tan,23 the
Court has held that one who desires a review of a criminal case must
The Petition is meritorious.
appeal within fifteen days from the date the decision or judgment was
announced in open court in the presence of the accused, or was
First Issue: promulgated in the manner set forth in Section 6 of Rule 116 (now
Section 624 of Rule 120) of the Rules of Court. This ruling was
Timeliness of the reiterated in People v. Tamani,25 in which the Court has further
clarified that the word promulgation in the old provision should be
Motion for Reconsideration construed as referring to "judgment;" and notice, to "order."26

Because the RTC Decision had been promulgated on December 15, The above ruling, however, is relevant and applicable to
1995, and respondent’s Motion for Reconsideration was filed two the accused who appeals. In the present case, we are confronted with
the Motion filed by the private offended party for reconsideration of Being interrelated, the second, third and fourth issues will be discussed
the civil aspect of the RTC judgment. It should also be noted that she together.
was not required to be present during the promulgation of the
judgment. Petitioner contends that her acquittal was not based merely on
reasonable doubt, but on the determination that she was not the author
In a long line of cases 27 as far back as People v. Ursua,28 this Court of the imputed felonies. She reiterates the trial court’s ruling in its
has ruled that the appeal period accorded to the accused should also March 20, 1996 Order that she could not be held civilly liable, because
be available to the offended party who seeks redress of the civil aspect she was not responsible for the crimes charged.
of a decision. Similarly, courts may apply this ruling to the filing of a
motion for reconsideration of a judgment. For them to do so will be Arguing on the assumption that she was acquitted on the basis of
consistent with this Court’s policy of giving lower tribunals a chance reasonable doubt, petitioner explains that the appellate court was
to rectify their possible errors29 and thereby promote the speedy and nevertheless precluded from taking cognizance of the civil aspect of
just disposition of controversies. the case, as a separate civil action should have been filed after the
judgment of acquittal. She contends that Article 29 of the Civil Code,
The relevant question is, when should the period for the filing of a which mandates the courts to make a finding on the civil liability in
motion by a private offended party begin? In Neplum v. Orbeso,30 this case of an acquittal based on reasonable ground, applies only to
Court explained that the period begins to toll upon service of the notice situations when a crime has been committed but the accused is exempt
of judgment upon the offended party. Thus: from criminal liability under the instances enumerated in Article 12 of
the Revised Penal Code (RPC).32
"Indeed, the rules governing the period of appeal in a purely civil
action should be the same as those covering the civil aspects of Petitioner finally argues that the real party-in-interest is not
criminal judgments. If these rules are not completely identical, the respondent, but Chemical Bank and/or Kai Chin, the owners of the
former may be suppletory to the latter. x x x. Being akin to a civil accounts from which the withdrawals were made.33
action, the present appeal may be guided by the Rules on Civil
Procedure."31 Respondent, on the other hand, asserts that the offended party may
appeal the civil aspect of the criminal proceeding despite the judgment
In the case before us, respondent undisputedly claims that petitioner of acquittal.34
received notice of the RTC Decision only on February 1, 1996.
Records show that FEBTC filed its Motion for Reconsideration on Civil Action Deemed Instituted
February 14, 1996. The Motion was thus filed within the reglementary
period. in the Criminal Proceeding

Second, Third and Fourth Issues: Article 100 of the RPC states that every person criminally liable for a
felony is also civilly liable. This rule holds true, except in instances
Civil Liability in Case of Acquittal when no actual damage results from an offense, such as espionage,
violation of neutrality, flight to an enemy country, and crime against For this purpose, the offended parties are allowed to intervene in the
popular representation.35 criminal proceedings, but solely to enforce their right to claim
indemnification for damages arising from the criminal act. 38 In Roa v.
Clearly, the extinction of the penal liability does not always carry with De la Cruz,39 in which the offended party failed to submit evidence of
it the extinction of the civil.36 According to Article 29 of the Civil damages despite having participated in the criminal proceedings, we
Code, if the acquittal is made on the ground that the guilt has not been had the occasion to rule in this wise:
proved beyond reasonable doubt, the accused may be held civilly
liable for damages arising from the same act or omission constituting "x x x. For such failure, she has only herself or her counsel to blame.
the offense. As in any ordinary civil case, the liability may be Of course, she could have still filed a motion for reconsideration or an
established by a mere preponderance of evidence. appeal to rectify the error. But this she failed to do, thus allowing the
decision to become final and executory. Under the principle of res
Section 1 of Rule 111 of the 1985 Rules of Court, the prevailing law judicata, that judgment is conclusive as to future proceedings at law
during the trial of this case below,37 provided the consequences of acts not only as to every matter which was offered and received to sustain
that produced both civil and criminal liabilities, as follows: the claim or demand, but as to any other admissible matter that could
have been offered for that purpose."
"SECTION 1. Institution of criminal and civil actions. – (a) When a
criminal action is instituted, the civil action for the recovery of civil In the present case, the original action involved a prosecution for
liability arising from the offense charged shall be deemed instituted estafa or swindling through falsification of commercial documents, an
with the criminal action unless the offended party waives the civil offense defined under the RPC. Records do not show -- and respondent
action, reserves the right to institute it separately or institutes the civil does not claim -- the presence of any of the three instances precluding
action prior to the criminal action. the automatic institution of the civil action together with the criminal
complaint. Ineluctably, respondent’s right to damages, if any, was
"Such civil action includes recovery of indemnity under the Revised deemed prosecuted in the criminal proceeding. Thus, a separate civil
Penal Code, and damages under Articles 32, 33, 34 and 2176 of the action may no longer be instituted.
Civil Code of the Philippines arising from the same act or omission of
the accused. Appeal of the Civil Aspect of the

x x x x x x x x x." Decision Acquitting the Accused

Clearly, under the foregoing 1985 rule, an action for the recovery of The consequences of an acquittal on the civil liability of the accused
civil liability arising from an offense charged is necessarily included are discussed by the Court in Manantan v. CA40 in this wise:
in the criminal proceedings, unless (1) there is an express waiver of
the civil action, or (2) there is a reservation to institute a separate one, "Our law recognizes two kinds of acquittal, with different effects on
or (3) the civil action was filed prior to the criminal complaint. the civil liability of the accused. First is an acquittal on the ground that
the accused is not the author of the act or omission complained of.
This instance closes the door to civil liability, for a person who has
been found to be not the perpetrator of any act or omission cannot and acquittal of the accused. But this recourse may prosper only if the
can never be held liable for such act or omission. There being no delict, nature of the trial court’s judgment falls under any of the three
civil liability ex delicto is out of the question, and the civil action, if categories stated in Salazar.
any, which may be instituted must be based on grounds other than
the delict complained of. This is the situation contemplated in Rule Acquittal of Petitioner Due to the
111 of the Rules of Court. The second instance is an acquittal based
on reasonable doubt on the guilt of the accused. In this case, even if Noncommission of the Imputed Acts
the guilt of the accused has not been satisfactorily established, he is
not exempt from civil liability which may be proved by preponderance A close scrutiny of the RTC Decision and Order leads us to the
of evidence only. This is the situation contemplated in Article 29 of conclusion that petitioner did not commit the crime imputed to her.
the Civil Code, where the civil action for damages is ‘for the same act Hence, her acquittal likewise extinguished the action for her civil
or omission.’ x x x." liability.

In Salazar v. People,41 the Court further expounded thus: In support of this conclusion, we initially quote at length these findings
of the trial court:
"The acquittal of the accused does not prevent a judgment against him
on the civil aspect of the case where (a) the acquittal is based on "Re: Crim. Cases No. 93-126175. – This case involves the bearer
reasonable doubt as only check for the amount of ₱250,040.86[.] This is the earliest
preponderance of evidence is required; (b) where the court declared questionable transaction allegedly committed by the accused as it
that the liability of the accused is only civil; (c) where the civil liability happened on 29 September 1992. According to FEBTC records, this
of the accused does not arise from or is not based upon the crime of was the initial transaction concerning the Chemical account wherein a
which the accused was acquitted. Moreover, the civil action based on cashier’s check payable to Chemical (CIF) was used by the accused to
the delict is extinguished if there is a finding in the final judgment in purchase another cashier’s check payable to ‘bearer’ which was later
the criminal action that the act or omission from which the civil deposited to the account of accused. During the investigation by the
liability may arise did not exist or where the accused did not commit bank’s Investigation Committee, Mrs. Bagsit averred that she
the acts or omission imputed to him. confirmed the transaction with Kai Chin and which was later on
supported by an authorization letter from Kai Chin. (p. 11, Exh. 1).
"If the accused is acquitted on reasonable doubt but the court renders
judgment on the civil aspect of the criminal case, the prosecution "There is no dispute that the check was deposited to the personal
cannot appeal from the judgment of acquittal as it would place the account of the accused (Exhs. C, C-1 and D) and part of the amount
accused in double jeopardy. However, the aggrieved party, the thereof was subsequently withdrawn by her (Exh. E), but accused
offended party or the accused or both may appeal from the judgment asserted that the deposit of said check to her account and the
on the civil aspect of the case within the period therefor." subsequent withdrawal of its amount were upon the authority and
instructions of Kai Chin, and that the withdrawn amount was actually
Based on the foregoing jurisprudence, it is settled that the private given by her to Kai Chin.
offended party may appeal the civil aspect of the judgment despite the
"Although Kai Chin denied having signed the confirmation at the back of the check constitutes the indorsement thereof while the
memorandum (Exh. B), there is absolutely no evidence on record that second signifies receipt of the payment of the value.
the money was never turned over to Kai Chin. Kai Chin did not testify,
on direct evidence or on rebuttal, concerning this aspect of the case. x "The only intervention of the accused concerning these checks, as
x x. appearing in the documentary exhibits, was her being named as the
representative of the purchaser and she must have picked up the
"Re: Crim. Cases Nos. 93-126172, 93-126178, 93-126189 and 93- checks for and in behalf of the purchaser. (See Exhs. P, N, O, K, L, S,
126190. -- These four cases involve the Cashier’s Checks applied for T, M, U, V, W, X, Y and Z). There is no indication, at least from the
and made payable to the accused (Exhs. G-1, F-2, H-2 and I-2). Exhs. documents of the prosecution, that accused had a hand in the
G-1 and F-2 were encashed by the accused because they bear at their encashments of the checks, otherwise, she should have been made to
back two signatures of hers, and according to the witnesses for the sign, as what was done in the case of the check marked as Exh. Q-1."42
prosecution the first of such signatures constitutes the indorsement
while the second signifies receipt of the proceeds of the payment As can be clearly gleaned from the above, petitioner consistently
thereof. On the other hand, Exhs. H-2 and I-2 were deposited by her claimed that she had acted merely upon the instructions and authority
in her personal account. According to the accused the drawing of the of her superior, Kai Chin. While admitting that she had deposited the
checks in her name and their encashments and deposit to her account proceeds of some of the checks to her personal account, she firmly
were upon the authority and instructions of Kai Chin, and that the insisted that she subsequently withdrew the cash proceeds and turned
values thereof were all turned over to Kai Chin. them over to him. She denied -- and the records do not show -- that
she had ever appropriated those moneys for her personal gain.
xxxxxxxxx
On the other hand, as the trial judge clearly noted, Kai Chin did not
"Re: Crim. Case No. 93-126171. – This case involves a Cashier’s even bother to rebut the statement of petitioner that she had turned
Check applied for and made payable to Kai Chin, signed twice at the over the proceeds of the checks to him.43 All he asserted was that he
back but accused nonetheless signed for the receipt of the payment had neither signed the applications for the purchase of the checks nor
thereof. x x x While Kai Chin denied on direct evidence that he signed endorsed those checks. His credibility was assessed by the judge thus:
the application for the purchase of this check and also the back of the
check itself, there is also no showing that the value thereof did not "Credibility of Kai Chin. – It must be noticed that, with the exception
reach him. Accused asserted that this check was applied for and of the ‘bearer’ check involved in Crim. Case No. 93-126175, the value
encashed upon the authority and instruction of Kai Chin, and that the of the Cashier’s Checks involve[d] were debited from the Chemical
value thereof was turned over to the latter. account. Kai Chin is undisputably one of the authorized signatories to
the Chemical account, and under ordinary course of things, he must be
xxxxxxxxx the payee and/or beneficiary of the checks.

"Re: the rest of the other criminal cases. -- The remaining fifteen other "Initially, Kai Chin sweepingly testified as follows:
cases involve checks applied for and drawn in the name of Kai Chin
and twice signed at the back. As intimated earlier, the first signature
‘Q: In her capacity as your secretary, when she was your secretary did ‘4.1 In January, 1992, Mr. Kai Chin personally went to the office of
Josephine Sanchez have anything to do with the Chemical MS. URSULA A. ALANO, Vice President of FEBII and allegedly
International Finance account? informed the latter that he will directly manage the CIF [also referred
to as CIFL or Chemical] account. Mr. Chin informed MS ALANO
‘A: No, sir. (tsn, p. 9, 8 Nov 1994)’ that instructions concerning the account will either originate from his
or his representative, MS. J. M. SANCHEZ;
"The records of the bank and FEBII, however, show otherwise. Thus,
as early as April, 1992, Kai Chin had already authorized the accused ‘Based on Mr. Chin’s instructions, placements
to transact matters concerning the Chemical account, through a /preterminations/payments of the account were transacted by Mr. Chin
memorandum he sent to Mrs. Beatriz Bagsit and one Ms. Enriquez, himself or his authorized representative, J. SANCHEZ. (p. 9, Exh. 1,
reading as follows: underscoring supplied; see also p. 11 of the same exhibit.)’

‘This is to request for the following:

‘1) Ms. Enriquez to partially terminate the amount of ₱250,000.00 "These facts were recited in the Memorandum of Ms. U.A. Ulano,
from the attached as Annex ‘B’ to Exh. 1, which reads as follows:
CIF’s placement (₱3M) and credit the same to SA#0101-58459-8
maintained at Intramuros Branch. ‘Facts: Due to the transfer of Mr. Kai Chin to FEBTC Head Office in
Intramuros last January 1992, he personally went to see me in my
‘2) Ms. Bagsit to debit SA#0101-58459-8 for ₱290,000.00 and entrust office to inform me that he was directly managing the CIF account.
the same to my Secretary, Ms. Jo Sanchez for proper disposition. He also informed me that instructions concerning the account will
either originate from him or his authorized representative, Ms. J. M.
‘In view of my home leave/business trip scheduled on April 29-June Sanchez.
8, 1992, the above requests will be confirmed by Ms. Sanchez upon
my instructions before the end of May, 1992. (Memo [dated] 28 April ‘Based on the given instructions of Mr. Kai Chin,
1992, attached as Annex B to Exh. 2.)’ placements/preterminations/payments of the account were transacted
by Mr. Kai Chin himself or his authorized representative, Ms. J. M.
"Kai Chin never denied his signature on this document, either on direct Sanchez. [Underscoring by the RTC.]’"45
evidence or on rebuttal (as he was not presented as a rebuttal
witness)."44 The above evidence led the trial court to conclude that "Kai Chin,
definitely, was less candid to the [c]ourt when he testified"46 that
The authority conferred by Kai Chin upon petitioner was also borne petitioner had nothing to do with the CIFL account.
out by the reports of the FEBTC Investigating Committee, pertinent
parts of which were quoted in the RTC Decision as follows: As regards petitioner’s testimony, the trial judge observed that she had
firmly and straightforwardly echoed the material allegations in her
"4. Initial interview with the officers of FEBII disclosed the following: Counter-Affidavit; and that, furthermore, her testimony had been
"corroborated by the People’s exhibits themselves."47 Indeed, her In view of the conflicting findings of the lower courts as regards the
claim that she had prior authorization from Kai Chin to undertake the credibility of the witnesses, we invoke the time-honored rule that "the
questioned transactions was supported by no less than the prosecution assessment of the credibility of witnesses and their
evidence. testimonies is a matter best undertaken by the trial court because of its
unique opportunity to observe the witnesses firsthand and note their
Thus, the trial court emphatically concluded that petitioner "was not demeanor, conduct and attitude under grilling examination. These are
the author of the frauds allegedly perfpetrated [sic],"48 if any. The the most significant factors in evaluating the sincerity of witnesses and
Court of Appeals concurred in that conclusion when it categorically in unearthing the truth, especially in the face of conflicting
held thus: "We rule out the issue of forgery as this was not testimonies. Through its observations during the entire proceedings,
satisfactorily proved x x x."49 the trial court can be expected to determine, with reasonable
discretion, whose testimony to accept and which witness to
Under Section 2(b) of Rule 111 of the Revised Rules of Court, a disbelieve."54
finding in a final judgment that the fact from which civil liability may
arise does not exist carries with it the extinction of the liability. Thus, Barring arbitrariness and oversight of facts that might affect the result
the critical issue in the present appeal is this: was the civil liability of of the case otherwise, the RTC’s assessment of the witnesses and their
petitioner duly established by the evidence? testimonies in this case binds even this Court.55 In any event, we
scoured the records and, unlike the CA, we found no sufficient reason
Answering in the affirmative, the CA explained that a single act or to reject the trial court’s assessment. There was no arbitrariness or
omission may produce two forms of civil liability: one is for ex oversight of any fact or circumstance of weight and influence to justify
delicto or that which arises from a crime under our penal statutes; and a different conclusion.
the other is for a quasi delict or culpa extra-contractual. In the present
case, civil liability ex delicto was foreclosed by the acquittal. Moreover, the CA based its imposition of civil liability upon petitioner
Nonetheless, "[a]lthough the act from which the civil liability might on her supposed abuse of her employer’s confidence. Granting for the
arise did not exist due to [petitioner’s] acquittal, [respondent’s] cause sake of argument that she indeed forged the checks and
of action makes out a case of quasi delict."50 misappropriated the proceeds to her personal benefit, it must be
recalled that it was Kai Chin’s signatures that she purportedly forged;
Contrary to the trial court, the CA disbelieved petitioner’s assertions and CIFL’s account that she, in effect, misappropriated. Be it
that she had turned over the proceeds of the checks to Kai Chin. remembered that respondent’s own documentary evidence
Granting that she was authorized to encash the checks, she supposedly unequivocally concurred in the assertion of petitioner that Kai Chin
had no like authority to deposit the proceeds to her personal bank had given her express authority to transact CIFL’s account on his
account. The appellate court concluded that, in breach of Article behalf. Consequently, it was his, not respondent’s, confidence that she
3351 of the Civil Code, "she abused the confidence reposed in her by had exploited. In other words, the factual premises of the CA did not
[respondent] in the performance of her duty."52 Thus, the CA ordered support its conclusion.
her to pay respondent the amount of ₱1,187,530.86 as actual damages,
representing the total value of five checks paid in her name and to her In sum, we hold that petitioner’s acquittal was based on the fact that
account.53 she had not committed the offense imputed to her. Consequently, she
cannot be held civilly liable. In concluding that she, as well as her
testimony, was credible, the trial court cannot be faulted with
arbitrariness or negligence. Tellingly, her testimony that she turned
over the proceeds of the subject checks to Kai Chin stands unrebutted.

WHEREFORE, the Petition is hereby GRANTED, and the assailed

CA Decision and Resolution SET ASIDE. The December 15, 1995
Decision and the March 20, 1996 Order of the Regional Trial Court of
Manila, Branch 52, are hereby REINSTATED. No pronouncement as
to costs.

SO ORDERED.
G.R. No. 150157 January 25, 2007 extensive damage. The bus veered to the left and stopped 7 to 8 meters
from point of collision.
MAURICIO MANLICLIC and PHILIPPINE RABBIT BUS
LINES, INC., Petitioners, Respondent suffered minor injuries while his driver was unhurt. He
vs. was first brought for treatment to the Manila Central University
MODESTO CALAUNAN, Respondent. Hospital in Kalookan City by Oscar Buan, the conductor of the
Philippine Rabbit Bus, and was later transferred to the Veterans
DECISION Memorial Medical Center.

CHICO-NAZARIO, J.: By reason of such collision, a criminal case was filed before the RTC
of Malolos, Bulacan, charging petitioner Manliclic with Reckless
Assailed before Us is the decision1 of the Court of Appeals in CA- Imprudence Resulting in Damage to Property with Physical Injuries,
G.R. CV No. 55909 which affirmed in toto the decision2 of the docketed as Crim. Case No. 684-M-89. Subsequently on 2 December
Regional Trial Court (RTC) of Dagupan City, Branch 42, in Civil Case 1991, respondent filed a complaint for damages against petitioners
No. D-10086, finding petitioners Mauricio Manliclic and Philippine Manliclic and PRBLI before the RTC of Dagupan City, docketed as
Rabbit Bus Lines, Inc. (PRBLI) solidarily liable to pay damages and Civil Case No. D-10086. The criminal case was tried ahead of the civil
attorney’s fees to respondent Modesto Calaunan. case. Among those who testified in the criminal case were respondent
Calaunan, Marcelo Mendoza and Fernando Ramos.
The factual antecedents are as follows:
In the civil case (now before this Court), the parties admitted the
The vehicles involved in this case are: (1) Philippine Rabbit Bus No. following:
353 with plate number CVD-478, owned by petitioner PRBLI and
driven by petitioner Mauricio Manliclic; and (2) owner-type jeep with 1. The parties agreed on the capacity of the parties to sue and
plate number PER-290, owned by respondent Modesto Calaunan and be sued as well as the venue and the identities of the vehicles
driven by Marcelo Mendoza. involved;

At around 6:00 to 7:00 o’clock in the morning of 12 July 1988, 2. The identity of the drivers and the fact that they are duly
respondent Calaunan, together with Marcelo Mendoza, was on his licensed;
way to Manila from Pangasinan on board his owner-type jeep. The
Philippine Rabbit Bus was likewise bound for Manila from 3. The date and place of the vehicular collision;
Concepcion, Tarlac. At approximately Kilometer 40 of the North
Luzon Expressway in Barangay Lalangan, Plaridel, Bulacan, the two 4. The extent of the injuries suffered by plaintiff Modesto
vehicles collided. The front right side of the Philippine Rabbit Bus hit Calaunan and the existence of the medical certificate;
the rear left side of the jeep causing the latter to move to the shoulder
on the right and then fall on a ditch with water resulting to further 5. That both vehicles were going towards the south; the
private jeep being ahead of the bus;
 6. That the weather was fair and the road was well paved and investigator of the PRBLI, in Criminal Case No. 684-M-89 was
straight, although there was a ditch on the right side where the marked and allowed to be adopted in the civil case on the ground that
jeep fell into.3 he was already dead.

When the civil case was heard, counsel for respondent prayed that the Respondent further marked, among other documents, as rebuttal
transcripts of stenographic notes (TSNs)4 of the testimonies of evidence, the TSNs10 of the testimonies of Donato Ganiban, Oscar
respondent Calaunan, Marcelo Mendoza and Fernando Ramos in the Buan and petitioner Manliclic in Criminal Case No. 684-M-89.
criminal case be received in evidence in the civil case in as much as
these witnesses are not available to testify in the civil case. The disagreement arises from the question: Who is to be held liable
for the collision?
Francisco Tuliao testified that his brother-in-law, respondent
Calaunan, left for abroad sometime in November, 1989 and has not Respondent insists it was petitioner Manliclic who should be liable
returned since then. Rogelio Ramos took the stand and said that his while the latter is resolute in saying it was the former who caused the
brother, Fernando Ramos, left for Amman, Jordan, to work. Rosalia smash up.
Mendoza testified that her husband, Marcelo Mendoza, left their
residence to look for a job. She narrated that she thought her husband The versions of the parties are summarized by the trial court as
went to his hometown in Panique, Tarlac, when he did not return after follows:
one month. She went to her husband’s hometown to look for him but
she was informed that he did not go there. The parties differed only on the manner the collision between the two
(2) vehicles took place. According to the plaintiff and his driver, the
The trial court subpoenaed the Clerk of Court of Branch 8, RTC, jeep was cruising at the speed of 60 to 70 kilometers per hour on the
Malolos, Bulacan, the court where Criminal Case No. 684-M-89 was slow lane of the expressway when the Philippine Rabbit Bus overtook
tried, to bring the TSNs of the testimonies of respondent the jeep and in the process of overtaking the jeep, the Philippine
Calaunan,5 Marcelo Mendoza6 and Fernando Ramos7 in said case, Rabbit Bus hit the rear of the jeep on the left side. At the time the
together with other documentary evidence marked therein. Instead of Philippine Rabbit Bus hit the jeep, it was about to overtake the jeep.
the Branch Clerk of Court, it was Enrique Santos Guevara, Court In other words, the Philippine Rabbit Bus was still at the back of the
Interpreter, who appeared before the court and identified the TSNs of jeep when the jeep was hit. Fernando Ramos corroborated the
the three afore-named witnesses and other pertinent documents he had testimony of the plaintiff and Marcelo Mendoza. He said that he was
brought.8 Counsel for respondent wanted to mark other TSNs and on another jeep following the Philippine Rabbit Bus and the jeep of
documents from the said criminal case to be adopted in the instant plaintiff when the incident took place. He said, the jeep of the plaintiff
case, but since the same were not brought to the trial court, counsel for overtook them and the said jeep of the plaintiff was followed by the
petitioners compromised that said TSNs and documents could be Philippine Rabbit Bus which was running very fast. The bus also
offered by counsel for respondent as rebuttal evidence. overtook the jeep in which he was riding. After that, he heard a loud
sound. He saw the jeep of the plaintiff swerved to the right on a grassy
For the defendants, petitioner Manliclic and bus conductor Oscar portion of the road. The Philippine Rabbit Bus stopped and they
Buan testified. The TSN9 of the testimony of Donato Ganiban, overtook the Philippine Rabbit Bus so that it could not moved (sic),
meaning they stopped in front of the Philippine Rabbit Bus. He In a decision dated 28 September 2001, the Court of Appeals, finding
testified that the jeep of plaintiff swerved to the right because it was no reversible error in the decision of the trial court, affirmed it in all
bumped by the Philippine Rabbit bus from behind. respects.14

Both Mauricio Manliclic and his driver, Oscar Buan admitted that the Petitioners are now before us by way of petition for review assailing
Philippine Rabbit Bus bumped the jeep in question. However, they the decision of the Court of Appeals. They assign as errors the
explained that when the Philippine Rabbit bus was about to go to the following:
left lane to overtake the jeep, the latter jeep swerved to the left because
it was to overtake another jeep in front of it. Such was their testimony I
before the RTC in Malolos in the criminal case and before this Court
in the instant case. [Thus, which of the two versions of the manner THE COURT OF APPEALS ERRED ON A QUESTION OF LAW
how the collision took place was correct, would be determinative of IN AFFIRMING THE TRIAL COURT’S QUESTIONABLE
who between the two drivers was negligent in the operation of their ADMISSION IN EVIDENCE OF THE TSN’s AND OTHER
respective vehicles.]11 DOCUMENTS PRESENTED IN THE CRIMINAL CASE.

Petitioner PRBLI maintained that it observed and exercised the II

diligence of a good father of a family in the selection and supervision
of its employee, specifically petitioner Manliclic. THE COURT OF APPEALS ERRED ON A QUESTION OF LAW
IN AFFIRMING THE TRIAL COURT’S RELIANCE ON THE
On 22 July 1996, the trial court rendered its decision in favor of VERSION OF THE RESPONDENT ON HOW THE ACCIDENT
respondent Calaunan and against petitioners Manliclic and PRBLI. SUPPOSEDLY OCCURRED.
The dispositive portion of its decision reads:
III
WHEREFORE, judgment is rendered in favor of the plaintiff and
against the defendants ordering the said defendants to pay plaintiff THE COURT OF APPEALS ERRED ON A QUESTION OF LAW
jointly and solidarily the amount of P40,838.00 as actual damages for IN AFFIRMING THE TRIAL COURT’S UNFAIR DISREGARD OF
the towing as well as the repair and the materials used for the repair of HEREIN PETITIONER PRBL’s DEFENSE OF EXERCISE OF DUE
the jeep in question; P100,000.00 as moral damages and DILIGENCE IN THE SELECTION AND SUPERVISION OF ITS
another P100,000.00 as exemplary damages and P15,000.00 as EMPLOYEES.
attorney’s fees, including appearance fees of the lawyer. In addition,
the defendants are also to pay costs.12 IV
Petitioners appealed the decision via Notice of Appeal to the Court of THE COURT OF APPEALS ERRED ON A QUESTION OF LAW
Appeals.13 IN AFFIRMING THE TRIAL COURT’S QUESTIONABLE
AWARD OF DAMAGES AND ATTORNEY’S FEE.
With the passing away of respondent Calaunan during the pendency are not parties to the criminal cases instituted against their
of this appeal with this Court, we granted the Motion for the employees.23
Substitution of Respondent filed by his wife, Mrs. Precila Zarate Vda.
De Calaunan, and children, Virgilio Calaunan, Carmelita Honeycomb, Notwithstanding the fact that petitioner PRBLI was not a party in said
Evelyn Calaunan, Marko Calaunan and Liwayway Calaunan. 15 criminal case, the testimonies of the three witnesses are still
admissible on the ground that petitioner PRBLI failed to object on
In their Reply to respondent’s Comment, petitioners informed this their admissibility.
Court of a Decision16 of the Court of Appeals acquitting petitioner
Manliclic of the charge17 of Reckless Imprudence Resulting in It is elementary that an objection shall be made at the time when an
Damage to Property with Physical Injuries attaching thereto a alleged inadmissible document is offered in evidence; otherwise, the
photocopy thereof. objection shall be treated as waived, since the right to object is merely
a privilege which the party may waive. Thus, a failure to except to the
On the first assigned error, petitioners argue that the TSNs containing evidence because it does not conform to the statute is a waiver of the
the testimonies of respondent Calaunan,18 Marcelo Mendoza19 and provisions of the law. Even assuming ex gratia argumenti that these
Fernando Ramos20 should not be admitted in evidence for failure of documents are inadmissible for being hearsay, but on account of
respondent to comply with the requisites of Section 47, Rule 130 of failure to object thereto, the same may be admitted and considered as
the Rules of Court. sufficient to prove the facts therein asserted.24 Hearsay evidence alone
may be insufficient to establish a fact in a suit but, when no objection
For Section 47, Rule 13021 to apply, the following requisites must be is made thereto, it is, like any other evidence, to be considered and
satisfied: (a) the witness is dead or unable to testify; (b) his testimony given the importance it deserves.25
or deposition was given in a former case or proceeding, judicial or
administrative, between the same parties or those representing the In the case at bar, petitioner PRBLI did not object to the TSNs
same interests; (c) the former case involved the same subject as that in containing the testimonies of respondent Calaunan, Marcelo Mendoza
the present case, although on different causes of action; (d) the issue and Fernando Ramos in the criminal case when the same were offered
testified to by the witness in the former trial is the same issue involved in evidence in the trial court. In fact, the TSNs of the testimonies of
in the present case; and (e) the adverse party had an opportunity to Calaunan and Mendoza were admitted by both
cross-examine the witness in the former case.22 petitioners.26 Moreover, petitioner PRBLI even offered in evidence the
TSN containing the testimony of Donato Ganiban in the criminal case.
Admittedly, respondent failed to show the concurrence of all the If petitioner PRBLI argues that the TSNs of the testimonies of
requisites set forth by the Rules for a testimony given in a former case plaintiff’s witnesses in the criminal case should not be admitted in the
or proceeding to be admissible as an exception to the hearsay rule. instant case, why then did it offer the TSN of the testimony of Ganiban
Petitioner PRBLI, not being a party in Criminal Case No. 684-M-89, which was given in the criminal case? It appears that petitioner PRBLI
had no opportunity to cross-examine the three witnesses in said case. wants to have its cake and eat it too. It cannot argue that the TSNs of
The criminal case was filed exclusively against petitioner Manliclic, the testimonies of the witnesses of the adverse party in the criminal
petitioner PRBLI’s employee. The cases dealing with the subsidiary case should not be admitted and at the same time insist that the TSN
liability of employers uniformly declare that, strictly speaking, they of the testimony of the witness for the accused be admitted in its favor.
To disallow admission in evidence of the TSNs of the testimonies of charge of Reckless Imprudence Resulting in Damage to Property with
Calaunan, Marcelo Mendoza and Fernando Ramos in the criminal case Physical Injuries.
and to admit the TSN of the testimony of Ganiban would be unfair.
To be resolved by the Court is the effect of petitioner Manliclic’s
We do not subscribe to petitioner PRBLI’s argument that it will be acquittal in the civil case.
denied due process when the TSNs of the testimonies of Calaunan,
Marcelo Mendoza and Fernando Ramos in the criminal case are to be From the complaint, it can be gathered that the civil case for damages
admitted in the civil case. It is too late for petitioner PRBLI to raise was one arising from, or based on, quasi-delict.30 Petitioner Manliclic
denial of due process in relation to Section 47, Rule 130 of the Rules was sued for his negligence or reckless imprudence in causing the
of Court, as a ground for objecting to the admissibility of the TSNs. collision, while petitioner PRBLI was sued for its failure to exercise
For failure to object at the proper time, it waived its right to object that the diligence of a good father in the selection and supervision of its
the TSNs did not comply with Section 47. employees, particularly petitioner Manliclic. The allegations read:

In Mangio v. Court of Appeals,27 this Court, through Associate Justice "4. That sometime on July 12, 1988 at around 6:20 A.M.
Reynato S. Puno,28 admitted in evidence a TSN of the testimony of a plaintiff was on board the above-described motor vehicle
witness in another case despite therein petitioner’s assertion that he travelling at a moderate speed along the North Luzon
would be denied due process. In admitting the TSN, the Court ruled Expressway heading South towards Manila together with
that the raising of denial of due process in relation to Section 47, Rule MARCELO MENDOZA, who was then driving the same;
130 of the Rules of Court, as a ground for objecting to the admissibility
of the TSN was belatedly done. In so doing, therein petitioner waived "5. That approximately at kilometer 40 of the North Luzon
his right to object based on said ground. Express Way, the above-described motor vehicle was
suddenly bumped from behind by a Philippine Rabbit Bus
Petitioners contend that the documents in the criminal case should not with Body No. 353 and with plate No. CVD 478 then being
have been admitted in the instant civil case because Section 47 of Rule driven by one Mauricio Manliclic of San Jose, Concepcion,
130 refers only to "testimony or deposition." We find such contention Tarlac, who was then travelling recklessly at a very fast speed
to be untenable. Though said section speaks only of testimony and and had apparently lost control of his vehicle;
deposition, it does not mean that documents from a former case or
proceeding cannot be admitted. Said documents can be admitted they "6. That as a result of the impact of the collision the above-
being part of the testimonies of witnesses that have been admitted. described motor vehicle was forced off the North Luzon
Accordingly, they shall be given the same weight as that to which the Express Way towards the rightside where it fell on its driver’s
testimony may be entitled. 29 side on a ditch, and that as a consequence, the above-described
motor vehicle which maybe valued at EIGHTY THOUSAND
On the second assigned error, petitioners contend that the version of PESOS (P80,000) was rendered a total wreck as shown by
petitioner Manliclic as to how the accident occurred is more credible pictures to be presented during the pre-trial and trial of this
than respondent’s version. They anchor their contention on the fact case;
that petitioner Manliclic was acquitted by the Court of Appeals of the
 "7. That also as a result of said incident, plaintiff sustained xxxx
bodily injuries which compounded plaintiff’s frail physical
condition and required his hospitalization from July 12, 1988 Absent evidence of negligence, therefore, accused-appellant cannot be
up to and until July 22, 1988, copy of the medical certificate held liable for Reckless Imprudence Resulting in Damage to Property
is hereto attached as Annex "A" and made an integral part with Physical Injuries as defined in Article 365 of the Revised Penal
hereof; Code. 32

"8. That the vehicular collision resulting in the total wreckage From the foregoing declaration of the Court of Appeals, it appears that
of the above-described motor vehicle as well as bodily (sic) petitioner Manliclic was acquitted not on reasonable doubt, but on the
sustained by plaintiff, was solely due to the reckless ground that he is not the author of the act complained of which is based
imprudence of the defendant driver Mauricio Manliclic who on Section 2(b) of Rule 111 of the Rules of Criminal Procedure which
drove his Philippine Rabbit Bus No. 353 at a fast speed reads:
without due regard or observance of existing traffic rules and
regulations; (b) Extinction of the penal action does not carry with it extinction of
the civil, unless the extinction proceeds from a declaration in a final
"9. That defendant Philippine Rabbit Bus Line Corporation judgment that the fact from which the civil might arise did not exist.
failed to exercise the diligence of a good father of (sic) family
in the selection and supervision of its drivers; x x x"31 In spite of said ruling, petitioner Manliclic can still be held liable for
the mishap. The afore-quoted section applies only to a civil action
Can Manliclic still be held liable for the collision and be found arising from crime or ex delicto and not to a civil action arising from
negligent notwithstanding the declaration of the Court of Appeals that quasi-delict or culpa aquiliana. The extinction of civil liability referred
there was an absence of negligence on his part? to in Par. (e) of Section 3, Rule 111 [now Section 2 (b) of Rule 111],
refers exclusively to civil liability founded on Article 100 of the
In exonerating petitioner Manliclic in the criminal case, the Court of Revised Penal Code, whereas the civil liability for the same act
Appeals said: considered as a quasi-delict only and not as a crime is not extinguished
even by a declaration in the criminal case that the criminal act charged
To the following findings of the court a quo, to wit: that accused- has not happened or has not been committed by the accused. 33
appellant was negligent "when the bus he was driving bumped the jeep
from behind"; that "the proximate cause of the accident was his having A quasi-delict or culpa aquiliana is a separate legal institution under
driven the bus at a great speed while closely following the jeep"; x x the Civil Code with a substantivity all its own, and individuality that
x is entirely apart and independent from a delict or crime – a distinction
exists between the civil liability arising from a crime and the
We do not agree. responsibility for quasi-delicts or culpa extra-contractual. The same
negligence causing damages may produce civil liability arising from
The swerving of Calaunan’s jeep when it tried to overtake the vehicle a crime under the Penal Code, or create an action for quasi-delicts or
in front of it was beyond the control of accused-appellant. culpa extra-contractual under the Civil Code.34 It is now settled that
acquittal of the accused, even if based on a finding that he is not guilty, affirmed by the appellate court, are binding and conclusive on the
does not carry with it the extinction of the civil liability based on quasi Supreme Court.38 Not being a trier of facts, this Court will not allow a
delict.35 review thereof unless:

In other words, if an accused is acquitted based on reasonable doubt (1) the conclusion is a finding grounded entirely on speculation,
on his guilt, his civil liability arising from the crime may be proved by surmise and conjecture; (2) the inference made is manifestly mistaken;
preponderance of evidence only. However, if an accused is acquitted (3) there is grave abuse of discretion; (4) the judgment is based on a
on the basis that he was not the author of the act or omission misapprehension of facts; (5) the findings of fact are conflicting; (6)
complained of (or that there is declaration in a final judgment that the the Court of Appeals went beyond the issues of the case and its
fact from which the civil might arise did not exist), said acquittal findings are contrary to the admissions of both appellant and
closes the door to civil liability based on the crime or ex delicto. In appellees; (7) the findings of fact of the Court of Appeals are contrary
this second instance, there being no crime or delict to speak of, civil to those of the trial court; (8) said findings of fact are conclusions
liability based thereon or ex delicto is not possible. In this case, a civil without citation of specific evidence on which they are based; (9) the
action, if any, may be instituted on grounds other than the delict facts set forth in the petition as well as in the petitioner's main and
complained of. reply briefs are not disputed by the respondents; and (10) the findings
of fact of the Court of Appeals are premised on the supposed absence
As regards civil liability arising from quasi-delict or culpa aquiliana, of evidence and contradicted by the evidence on record. 39
same will not be extinguished by an acquittal, whether it be on ground
of reasonable doubt or that accused was not the author of the act or After going over the evidence on record, we do not find any of the
omission complained of (or that there is declaration in a final judgment exceptions that would warrant our departure from the general rule. We
that the fact from which the civil liability might arise did not exist). fully agree in the finding of the trial court, as affirmed by the Court of
The responsibility arising from fault or negligence in a quasi-delict is Appeals, that it was petitioner Manliclic who was negligent in driving
entirely separate and distinct from the civil liability arising from the PRBLI bus which was the cause of the collision. In giving
negligence under the Penal Code.36 An acquittal or conviction in the credence to the version of the respondent, the trial court has this say:
criminal case is entirely irrelevant in the civil case37 based on quasi-
delict or culpa aquiliana. x x x Thus, which of the two versions of the manner how the collision
took place was correct, would be determinative of who between the
Petitioners ask us to give credence to their version of how the collision two drivers was negligent in the operation of their respective vehicle.
occurred and to disregard that of respondent’s. Petitioners insist that
while the PRBLI bus was in the process of overtaking respondent’s In this regard, it should be noted that in the statement of Mauricio
jeep, the latter, without warning, suddenly swerved to the left (fast) Manliclic (Exh. 15) given to the Philippine Rabbit Investigator CV
lane in order to overtake another jeep ahead of it, thus causing the Cabading no mention was made by him about the fact that the driver
collision. of the jeep was overtaking another jeep when the collision took place.
The allegation that another jeep was being overtaken by the jeep of
As a general rule, questions of fact may not be raised in a petition for Calaunan was testified to by him only in Crim. Case No. 684-M-89
review. The factual findings of the trial court, especially when before the Regional Trial Court in Malolos, Bulacan and before this
Court. Evidently, it was a product of an afterthought on the part of on the left side thereof rather than on its rear. Furthermore, the jeep
Mauricio Manliclic so that he could explain why he should not be held should have fallen on the road itself rather than having been forced off
responsible for the incident. His attempt to veer away from the truth the road. Useless, likewise to emphasize that the Philippine Rabbit was
was also apparent when it would be considered that in his statement running very fast as testified to by Ramos which was not controverted
given to the Philippine Rabbit Investigator CV Cabading (Exh. 15), he by the defendants.40
alleged that the Philippine Rabbit Bus bumped the jeep of Calaunan
while the Philippine Rabbit Bus was behind the said jeep. In his Having ruled that it was petitioner Manliclic’s negligence that caused
testimony before the Regional Trial Court in Malolos, Bulacan as well the smash up, there arises the juris tantum presumption that the
as in this Court, he alleged that the Philippine Rabbit Bus was already employer is negligent, rebuttable only by proof of observance of the
on the left side of the jeep when the collision took place. For this diligence of a good father of a family. 41 Under Article 218042 of the
inconsistency between his statement and testimony, his explanation New Civil Code, when an injury is caused by the negligence of the
regarding the manner of how the collision between the jeep and the employee, there instantly arises a presumption of law that there was
bus took place should be taken with caution. It might be true that in negligence on the part of the master or employer either in the selection
the statement of Oscar Buan given to the Philippine Rabbit of the servant or employee, or in supervision over him after selection
Investigator CV Cabading, it was mentioned by the former that the or both. The liability of the employer under Article 2180 is direct and
jeep of plaintiff was in the act of overtaking another jeep when the immediate; it is not conditioned upon prior recourse against the
collision between the latter jeep and the Philippine Rabbit Bus took negligent employee and a prior showing of the insolvency of such
place. But the fact, however, that his statement was given on July 15, employee. Therefore, it is incumbent upon the private respondents to
1988, one day after Mauricio Manliclic gave his statement should not prove that they exercised the diligence of a good father of a family in
escape attention. The one-day difference between the giving of the two the selection and supervision of their employee. 43
statements would be significant enough to entertain the possibility of
Oscar Buan having received legal advise before giving his statement. In the case at bar, petitioner PRBLI maintains that it had shown that it
Apart from that, as between his statement and the statement of exercised the required diligence in the selection and supervision of its
Manliclic himself, the statement of the latter should prevail. Besides, employees, particularly petitioner Manliclic. In the matter of selection,
in his Affidavit of March 10, 1989, (Exh. 14), the unreliability of the it showed the screening process that petitioner Manliclic underwent
statement of Oscar Buan (Exh. 13) given to CV Cabading rear its "ugly before he became a regular driver. As to the exercise of due diligence
head" when he did not mention in said affidavit that the jeep of in the supervision of its employees, it argues that presence of ready
Calaunan was trying to overtake another jeep when the collision investigators (Ganiban and Cabading) is sufficient proof that it
between the jeep in question and the Philippine Rabbit bus took place. exercised the required due diligence in the supervision of its
employees.
xxxx
In the selection of prospective employees, employers are required to
If one would believe the testimony of the defendant, Mauricio examine them as to their qualifications, experience and service
Manliclic, and his conductor, Oscar Buan, that the Philippine Rabbit records. In the supervision of employees, the employer must formulate
Bus was already somewhat parallel to the jeep when the collision took standard operating procedures, monitor their implementation and
place, the point of collision on the jeep should have been somewhat impose disciplinary measures for the breach thereof. To fend off
vicarious liability, employers must submit concrete proof, including the erring driver the recruitment procedures and company policies on
documentary evidence, that they complied with everything that was efficiency and safety were followed." x x x.
incumbent on them. 44
The trial court found that petitioner PRBLI exercised the diligence of
In Metro Manila Transit Corporation v. Court of Appeals, 45 it was a good father of a family in the selection but not in the supervision of
explained that: its employees. It expounded as follows:

Due diligence in the supervision of employees on the other hand, From the evidence of the defendants, it seems that the Philippine
includes the formulation of suitable rules and regulations for the Rabbit Bus Lines has a very good procedure of recruiting its driver as
guidance of employees and the issuance of proper instructions well as in the maintenance of its vehicles. There is no evidence though
intended for the protection of the public and persons with whom the that it is as good in the supervision of its personnel. There has been no
employer has relations through his or its employees and the imposition iota of evidence introduced by it that there are rules promulgated by
of necessary disciplinary measures upon employees in case of breach the bus company regarding the safe operation of its vehicle and in the
or as may be warranted to ensure the performance of acts way its driver should manage and operate the vehicles assigned to
indispensable to the business of and beneficial to their employer. To them. There is no showing that somebody in the bus company has been
this, we add that actual implementation and monitoring of consistent employed to oversee how its driver should behave while operating
compliance with said rules should be the constant concern of the their vehicles without courting incidents similar to the herein case. In
employer, acting through dependable supervisors who should regard to supervision, it is not difficult to observe that the Philippine
regularly report on their supervisory functions. Rabbit Bus Lines, Inc. has been negligent as an employer and it should
be made responsible for the acts of its employees, particularly the
In order that the defense of due diligence in the selection and driver involved in this case.
supervision of employees may be deemed sufficient and plausible, it
is not enough to emptily invoke the existence of said company We agree. The presence of ready investigators after the occurrence of
guidelines and policies on hiring and supervision. As the negligence the accident is not enough to exempt petitioner PRBLI from liability
of the employee gives rise to the presumption of negligence on the part arising from the negligence of petitioner Manliclic. Same does not
of the employer, the latter has the burden of proving that it has been comply with the guidelines set forth in the cases above-mentioned.
diligent not only in the selection of employees but also in the actual The presence of the investigators after the accident is not enough
supervision of their work. The mere allegation of the existence of supervision. Regular supervision of employees, that is, prior to any
hiring procedures and supervisory policies, without anything more, is accident, should have been shown and established. This, petitioner
decidedly not sufficient to overcome such presumption. failed to do. The lack of supervision can further be seen by the fact
that there is only one set of manual containing the rules and regulations
We emphatically reiterate our holding, as a warning to all employers, for all the drivers of PRBLI. 46 How then can all the drivers of
that "the formulation of various company policies on safety without petitioner PRBLI know and be continually informed of the rules and
showing that they were being complied with is not sufficient to exempt regulations when only one manual is being lent to all the drivers?
petitioner from liability arising from negligence of its employees. It is
incumbent upon petitioner to show that in recruiting and employing
For failure to adduce proof that it exercised the diligence of a good
father of a family in the selection and supervision of its employees,
petitioner PRBLI is held solidarily responsible for the damages caused
by petitioner Manliclic’s negligence.

We now go to the award of damages. The trial court correctly awarded

the amount of P40,838.00 as actual damages representing the amount
paid by respondent for the towing and repair of his jeep. 47 As regards
the awards for moral and exemplary damages, same, under the
circumstances, must be modified. The P100,000.00 awarded by the
trial court as moral damages must be reduced
to P50,000.00.48 Exemplary damages are imposed by way of example
or correction for the public good.49 The amount awarded by the trial
court must, likewise, be lowered to P50,000.00.50 The award
of P15,000.00 for attorney’s fees and expenses of litigation is in order
and authorized by law.51

WHEREFORE, premises considered, the instant petition for review is

DENIED. The decision of the Court of Appeals in CA-G.R. CV No.
55909 is AFFIRMED with the MODIFICATION that (1) the award
of moral damages shall be reduced to P50,000.00; and (2) the award
of exemplary damages shall be lowered to P50,000.00. Costs against
petitioners.

SO ORDERED.
G.R. No. L-48157 March 16, 1988 Petitioner filed a motion to dismiss the complaint, and upon denial
thereof, filed his Answer to the complaint, specifically denying the
RICARDO QUIAMBAO, petitioner, material allegations therein and averring that the Agreement upon
vs. which private respondents base their prior possession over the
HON. ADRIANO OSORIO, ZENAIDA GAZA BUENSUCERO, questioned lot had already been cancelled by the Land Authority in an
JUSTINA GAZA BERNARDO, and FELIPE GAZA, Order signed by its Governor, Conrado Estrella. By way of affirmative
respondents-appellees, LAND AUTHORITY, intervenor-appellant. defense and as a ground for dismissing the case, petitioner alleged the
pendency of L.A. Case No. 968, an administrative case before the
Office of the Land Authority between the same parties and involving
the same piece of land. In said administrative case, petitioner disputed
FERNAN, J.: private respondents' right of possession over the property in question
by reason of the latter's default in the installment payments for the
This case was certified to Us by the Court of Appeals as one involving purchase of said lot. Petitioner asserted that his administrative case
pure questions of law pursuant to Section 3, Rule 50 of the Revised was determinative of private respondents' right to eject petitioner from
the lot in question; hence a prejudicial question which bars a judicial
Rules of Court.
action until after its termination.
The antecedents are as follows:
After hearing, the municipal court denied the motion to dismiss
contained in petitioner's affirmative defenses. It ruled that inasmuch
In a complaint for forcible entry filed by herein private respondents
as the issue involved in the case was the recovery of physical
Zenaida Gaza Buensucero, Justina Gaza Bernardo and Felipe Gaza
possession, the court had jurisdiction to try and hear the case.
against herein petitioner Ricardo Quiambao before the then Municipal
Court of Malabon, Rizal, docketed therein as Civil Case No. 2526, it
was alleged that private respondents were the legitimate possessors of Dissatisfied with this ruling, petitioner filed before the then Court of
a 30,835 sq. m. lot known as Lot No. 4, Block 12, Bca 2039 of the First Instance of Rizal, Branch XII, Caloocan City in Civil Case No.
Longos Estate situated at Barrio Longos, Malabon Rizal, by virtue of C-1576 a petition for certiorari with injunction against public
the Agreement to Sell No. 3482 executed in their favor by the former respondent Judge Adriano Osorio of the Municipal Court of Malabon
Land Tenure Administration [which later became the Land Authority, and private respondents, praying for the issuance of a writ of
preliminary injunction ordering respondent judge to suspend the
then the Department of Agrarian Reform]; that under cover of
darkness, petitioner surreptitiously and by force, intimidation, strategy hearing in the ejectment case until after the resolution of said petition.
and stealth, entered into a 400 sq. m. portion thereof, placed bamboo As prayed for, the then CFI of Rizal issued a restraining order
posts "staka" over said portion and thereafter began the construction enjoining further proceedings in the ejectment case.
of a house thereon; and that these acts of petitioner, which were
unlawful per se, entitled private respondents to a writ of preliminary In his answer, respondent municipal judge submitted himself to the
injunction and to the ejectment of petitioner from the lot in question. sound discretion of the CFI in the disposition of the petition for
certiorari. Private respondents, on the other hand, filed a motion to
dismiss the petition, maintaining that the administrative case did not
constitute a prejudicial question as it involved the question of The essential elements of a prejudicial question as provided under
ownership, unlike the ejectment case which involved merely the Section 5, Rule 111 of the Revised Rules of Court are: [a] the civil
question of possession. action involves an issue similar or intimately related to the issue in the
criminal action; and [b] the resolution of such issue determines
Meanwhile, the Land Authority filed an Urgent Motion for Leave to whether or not the criminal action may proceed.
Intervene in Civil Case No. C-1576 alleging the pendency of an
administrative case between the same parties on the same subject The actions involved in the case at bar being respectively civil and
matter in L.A. Case No. 968 and praying that the petition for certiorari administrative in character, it is obvious that technically, there is no
be granted, the ejectment complaint be dismissed and the Office of the prejudicial question to speak of. Equally apparent, however, is the
Land Authority be allowed to decide the matter exclusively. intimate correlation between said two [2] proceedings, stemming from
the fact that the right of private respondents to eject petitioner from
Finding the issue involved in the ejectment case to be one of prior the disputed portion depends primarily on the resolution of the
possession, the CFI dismissed the petition for certiorari and lifted the pending administrative case. For while it may be true that private
restraining order previously issued. Petitioner's motion for respondents had prior possession of the lot in question, at the time of
reconsideration of the dismissal order, adopted in toto by Intervenor the institution of the ejectment case, such right of possession had been
Land Authority was denied for lack of merit. Hence, this appeal filed terminated, or at the very least, suspended by the cancellation by the
by petitioner Quiambao and intervenor Land Authority with the Court Land Authority of the Agreement to Sell executed in their favor.
of Appeals, and certified to Us as aforesaid. Whether or not private respondents can continue to exercise their right
of possession is but a necessary, logical consequence of the issue
The instant controversy boils down to the sole question of whether or involved in the pending administrative case assailing the validity of
not the administrative case between the private parties involving the the cancellation of the Agreement to Sell and the subsequent award of
lot subject matter of the ejectment case constitutes a prejudicial the disputed portion to petitioner. If the cancellation of the Agreement
question which would operate as a bar to said ejectment case. to Sell and the subsequent award to petitioner are voided, then private
respondents would have every right to eject petitioner from the
A prejudicial question is understood in law to be that which arises in disputed area. Otherwise, private respondent's light of possession is
a case the resolution of which is a logical antecedent of the issue lost and so would their right to eject petitioner from said portion.
involved in said case and the cognizance of which pertains to another
tribunal. 1 The doctrine of prejudicial question comes into play Faced with these distinct possibilities, the more prudent course for the
generally in a situation where civil and criminal actions are pending trial court to have taken is to hold the ejectment proceedings in
and the issues involved in both cases are similar or so closely related abeyance until after a determination of the administrative case. Indeed,
that an issue must be pre-emptively resolved in the civil case before logic and pragmatism, if not jurisprudence, dictate such move. To
the criminal action can proceed. Thus, the existence of a prejudicial allow the parties to undergo trial notwithstanding the possibility of
question in a civil case is alleged in the criminal case to cause the petitioner's right of possession being upheld in the pending
suspension of the latter pending final determination of the former. administrative case is to needlessly require not only the parties but the
court as well to expend time, effort and money in what may turn out
to be a sheer exercise in futility. Thus, 1 Am Jur 2d tells us:
 The court in which an action is pending may, in the "As it appears that the genuineness of
exercise of a sound discretion, upon proper the document allegedly forged by
application for a stay of that action, hold the action in respondent attorneys in
abeyance to abide the outcome of another pending in Administrative Case No. 77 [Richard
another court, especially where the parties and the Ignacio Celdran vs. Santiago Catane,
issues are the same, for there is power inherent in etc., et al.] is necessarily involved in
every court to control the disposition of causes on its Civil Case No. R-3397 of the Cebu
dockets with economy of time and effort for itself, for Court of First Instance, action on the
counsel, and for litigants. Where the rights parties to herein complaint is withheld until
the second action cannot be properly determined until that litigation has finally been
the questions raised in the first action are settled the decided. Complainant Celdran shall
second action should be stayed.2 inform the Court about such
decision."3
While this rule is properly applicable to instances involving two [2]
court actions, the existence in the instant case of the same If a pending civil case may be considered to be in the nature of a
considerations of Identity of parties and issues, economy of time and prejudicial question to an administrative case, We see no reason why
effort for the court, the counsels and the parties as well as the need to the reverse may not be so considered in the proper case, such as in the
resolve the parties' right of possession before the ejectment case may petition at bar. Finally, events occuring during the pendency of this
be properly determined, justifies the rule's analogous application to the petition attest to the wisdom of the conclusion herein reached. For in
case at bar. the Manifestation filed by counsel for petitioner, it was stated that the
intervenor Land Authority which later became the Department of
Fortich-Celdran, et al. vs. Celdran, et al., 19 SCRA 502, provides Agrarian Reform had promulgated a decision in the administrative
another analogous situation. In sustaining the assailed order of the then case, L.A. Case No. 968 affiriming the cancellation of Agreement to
Court of First Instance of Misamis Oriental ordering the suspension of Sell No. 3482 issued in favor of private respondents. With this
the criminal case for falsification of public document against several development, the folly of allowing the ejectment case to proceed is too
persons, among them the subscribing officer Santiago Catane until the evident to need further elaboration.
civil case involving the issue of the genuineness of the alleged forged
document shall have been decided, this Court cited as a reason therefor WHEREFORE, the instant petition is hereby GRANTED. Civil Case
its own action on the administrative charges against said Santiago No. 2526 of the then Municipal Court of Malabon, Rizal is hereby
Catane, as follows: ordered DISMISSED. No Costs.

It should be mentioned here also that an SO ORDERED.

administrative case filed in this Court against
Santiago Catane upon the same charge was held by
Us in abeyance, thus:
GR. No. 101236 January 30, 1992 After investigation, the Provincial Prosecutor instituted a criminal
complaint for estafa against Paras with the Municipal Circuit Trial
JULIANA P. YAP, petitioner, Court of Glan-Malapatan, South Cotabato, presided by Judge Alfredo
vs. D. Barcelona, Sr.
MARTIN PARAS and ALFREDO D. BARCELONA, SR., Judge
of the 3rd MTC of Glan Malapatan, South Cotabato, respondents. On April 17, 1991, before arraignment of the accused, the trial
judge motu proprio issued an order dismissing the criminal case on
Mariano C. Alegarbes for petitioner. the ground that:

Public Attorney's Office for private respondent. . . . after a careful scrutiny of the statements of
complainant, Juliana P. Yap and of the respondent
Martin Paras and his witnesses, the Court holds and
maintained (sic) that there is a prejudicial question to
CRUZ, J.: a civil action, which must be ventilated in the proper
civil court. In the case of Ras vs. Rasul, 100 SCRA
This is still another dispute between brother and sister over a piece of 125, the Supreme Court had already made a
property they inherited from their parents. The case is complicated by pronouncement that "a criminal action for Estafa for
the circumstance that the private respondent's counsel in this petition alleged double sale of property is a prejudicial
is the son of the judge, the other respondent, whose action is being question to a civil action for nullity of the alleged
questioned. Deed of Sale and defense of the alleged vendors of
forgeries of their signatures to the Deed." 3
Petitioner Juliana P. Yap was the sister of private respondent Martin
The Petitioner moved for reconsideration, which was denied on April
Paras.*
30, 1990. She then came to this Court for relief in this special civil
action for certiorari.
On October 31, 1971, according to Yap, Paras sold to her his share in
the intestate estate for P300.00. The sale was evidenced by a private
document. Nineteen years later, on May 2, 1990, Paras sold the same The Court could have referred this petition to the Court of Appeals,
property to Santiago Saya-ang for P5,000.00. This was evidenced by which has concurrent jurisdiction under BP 129, but decided to resolve
the case directly in view of the peculiar circumstances involved.
a notarized Deed of Absolute Sale.
The petitioner's contention is that where there is a prejudicial question
When Yap learned of the second sale, she filed a complaint for estafa
against Paras and Saya-ang with the Office of the Provincial in a civil case, the criminal action may not be dismissed but only
Prosecutor of General Santos City. 1 On the same date, she filed a suspended. Moreover, this suspension may not be done motu
complaint for the nullification of the said sale with the Regional Trial proprio by the judge trying the criminal case but only upon petition of
the defendant in accordance with the Rules of Court. It is also stressed
Court of General Santos City. 2
that a reversal of the order of dismissal would not bar the prosecution
of the accused under the double jeopardy rule because he has not yet Judge Barcelona's precipitate action is intriguing, to say the least, in
been arraigned. light of the clear provision of the above-quoted rule. The rule is not
even new, being only a rewording of the original provision in the
The Court notes that the counsel for private respondent Paras who Rules of Court before they were amended. It plainly says that the
filed the comment in his behalf is the son and namesake of Judge suspension may be made only upon petition and not at the instance of
Barcelona. Atty. Alfredo L. Barcelona, Jr. is employed in the Public the judge alone, and it also says suspension, and not dismissal. One
Attorney's Office. He has made it of record that he was not the counsel also wonders if the person who notarized the disputed second sale,
of Paras at the time the questioned order of dismissal was issued by Notary Public Alexander C. Barcelona, might be related to the
his father. He thus impliedly rejects the charge of bias against his respondent judge.
father.
But more important than the preceding considerations is the trial
Perhaps out of filial loyalty, Atty. Barcelona suggests there may have judge's misapprehension of the concept of a prejudicial question.
been a basis for the order in view of the alleged double sale of the
property which was being litigated in the regional trial court. He Section 5, Rule 111 of the 1985 Rules on Criminal Procedure as
concedes, however, that the order may have been premature and that amended provides:
it could not have been issued motu proprio. Agreeing that double
jeopardy would not attach because of the lack of arraignment, he asks Sec. 5. Elements of prejudicial question. — The two
that his Comment be considered a motion for the suspension of the (2) essential elements of a prejudicial question are: (a)
criminal action on the ground of prejudicial question. the civil action involves an issue similar or intimately
related to the issue raised in the criminal action; and
The Court has deliberated on the issues and finds that the respondent (b) the resolution of such issue determines whether or
judge did indeed commit grave abuse of discretion in motu not the criminal action may proceed.
proprio issuing the order of dismissal.
A prejudicial question is defined as that which arises in a case the
Section 6, Rule 111 of the 1985 Rules on Criminal Procedure as resolution of which is a logical antecedent of the issue involved
amended by this Court on July 7, 1988, provides as follows: therein, and the congnizance of which pertains to another tribunal. The
prejudicial question must be determinative of the case before the court
Sec. 6. Suspension by reason of prejudicial question. but the jurisdiction to try and resolve the question must be lodged in
— A petition for suspension of the criminal action another court or tribunal. 4 It is a question based on a fact distinct and
based upon the pendency of a prejudicial question in separate from the crime but so intimately connected with it that it
a civil action may be filed in the office of the fiscal or determines the guilt or innocence of the accused. 5
the court conducting the preliminary investigation.
When the criminal action has been filed in court for We have held that "for a civil case to be considered prejudicial to a
trial, the petition to suspend shall be filed in the same criminal action as to cause the suspension of the criminal action
criminal action at any time before the prosecution pending the determination of the civil action, it must appear not only
rests. that the civil case involves the same facts upon which the criminal
prosecution is based, but also that the resolution of the issues raised in on the very same facts which would be necessarily
said civil action would be necessarily determinative of the guilt or determinative of petitioner Ras' guilt or innocence as
innocence of the accused". 6 accused in the criminal case. If the first alleged sale
in favor of Pichel is void or fictitious, then there
It is the issue in the civil action that is prejudicial to the continuation would be no double sale and petitioner would be
of the criminal action, not the criminal action that is prejudicial to the innocent of the offense charged. A conviction in the
civil action. criminal case (if it were allowed to proceed ahead)
would be a gross injustice and would have to be set
The excerpt quoted by the respondent judge in his Order does not aside if it were finally decided in the civil action that
appear anywhere in the decision of Ras v. Rasul. 7 Worse, he has not indeed the alleged prior deed of sale was a forgery
only misquoted the decision but also wrongly applied it. The facts of and spurious.
that case are not analogous to those in the case at bar.
xxx xxx xxx
In that case, Ras allegedly sold to Pichel a parcel of land which he later
also sold to Martin. Pichel brought a civil action for nullification of The petitioner Alejandro Ras claims in his answer to
the second sale and asked that the sale made by Ras in his favor be the complaint in Civil Case No. 73 that he had never
declared valid. Ras's defense was that he never sold the property to sold the property in litigation to the plaintiff (Luis
Pichel and his purported signatures appearing in the first deed of sale Pichel) and that his signatures in the alleged deed of
were forgeries. Later, an information for estafa was filed against Ras sale and that of his wife were forged by the plaintiff.
based on the same double sale that was the subject of the civil action. It is, therefore, necessary that the truth or falsity of
Ras filed a "Motion for Suspension of Action" (that is, the criminal such claim be first determined because if his claim is
case), claiming that the resolution of the issues in the civil case would true, then he did not sell his property twice and no
necessarily be determinative of his guilt or innocence. estafa was committed. The question of nullity of the
sale is distinct and separate from the crime of estafa
Through then Associate Justice Claudio Teehankee, this Court ruled (alleged double sale) but so intimately connected with
that a suspension of the criminal action was in order because: it that it determines the guilt or innocence of herein
petitioner in the criminal action.
On the basis of the issues raised in both the criminal
and civil cases against petitioner and in the light of In the Ras case, there was a motion to suspend the criminal action on
the foregoing concepts of a prejudicial question, there the ground that the defense in the civil case — forgery of his signature
indeed appears to be a prejudicial question in the case in the first deed of sale — had to be threshed out first. Resolution of
at bar, considering that petitioner Alejandro Ras' that question would necessarily resolve the guilt or innocence of the
defense (as defendant) in Civil Case No. 73 of the accused in the criminal case. By contrast, there was no motion for
nullity and forgery of the alleged prior deed of sale in suspension in the case at bar; and no less importantly, the respondent
favor of Luis Pichel (plaintiff in the civil case and judge had not been informed of the defense Paras was raising in the
complaining witnesses in the criminal case) is based civil action. Judge Barcelona could not have ascertained then if the
issue raised in the civil action would determine the guilt or innocence
of the accused in the criminal case.

It is worth remarking that not every defense raised in the civil action
will raise a prejudicial question to justify suspension of the criminal
action. The defense must involve an issue similar or intimately related
to the same issue raised in the criminal action and its resolution should
determine whether or not the latter action may proceed.

The order dismissing the criminal action without a motion for

suspension in accordance with Rule 111, Section 6, of the 1985 Rules
on Criminal Procedure as amended, and even without the accused
indicating his defense in the civil case for the annulment of the second
sale, suggests not only ignorance of the law but also bias on the part
of the respondent judge.

Judge Alfredo D. Barcelona, Sr. is sternly reminded that under the

Code of Judicial Conduct, "a judge shall be faithful to the law and
maintain professional competence" and "should administer justice
impartially." He is hereby reprimanded for his questionable conduct
in the case at bar, with the warning that commission of similar acts in
the future will be dealt with more severely.

WHEREFORE, the petition is GRANTED. The Order issued by Judge

Alfredo D. Barcelona, Sr. dated April 17, 1991, dismissing Criminal
Case No. 1902-G, and the Order dated April 30, 1991, denying the
motion for reconsideration, are REVERSED and SET ASIDE.
Criminal Case No. 1902-G is ordered REINSTATED for further
proceedings, but to be assigned to a different judge.

SO ORDERED.
G.R. No. 97477 May 8, 1992 municipality leased an Area of 1,350 square meters to the defendants
(respondents herein) subject to the condition that they should vacate
RTC JUDGE CAMILO E. TAMIN, Presiding Judge, Regional the place in case it is needed for public purposes; that the defendants
Trial Court, Branch 23, Molave, Zamboanga del Sur and the religiously paid the rentals until 1967; that thereafter, the defendants
MUNICIPALITY OF DUMINGAG, ZAMBOANGA DEL SUR; refused to pay the rentals; that the incumbent mayor discovered that
represented by MAYOR DOMICIANO E. REAL, petitioners, the defendants filed a "Cadastral Answer" over said lot; that the
vs. defendants refused to vacate the place despite efforts of the
COURT OF APPEALS, VICENTE MEDINA and FORTUNATA municipality; that the national government had alloted an
ROSELLON, respondents. appropriation for the construction of a municipal gymnasium within
the public plaza but the said construction which was already started
could not continue because of the presence of the buildings
constructed by the defendants; that the appropriation for the
GUTIERREZ, JR., J.: construction of the gymnasium might be reverted back to the national
government which would result to "irreparable damage, injury and
The present petition seeks to annul and set aside the decision and prejudice" to the municipality and its people who are expected to
resolution dated January 21, 1991 and February 20, 1991, respectively derive benefit from the accomplishment of the project.
of the Court of Appeals which declared as null and void the October
10, 1991 order of the petitioner Judge in a civil case "for ejectment The complaint prayed:
with preliminary injunction and damages" filed by petitioner
municipality against the private respondents granting the petitioner 1. That a restraining order shall be issued immediately
municipality's motion for a writ of possession and the writ issued after the filing of this case;
pursuant to it.
2. That after due notice and hearing, a writ of
On September 24, 1990, petitioner municipality represented by its preliminary mandatory injunction shall be issued
mayor Domiciano E. Real filed with the Regional Trial Court of against the herein defendants for them (sic) form
Zamboanga del Sur, Branch 23, Molave, presided by the petitioner further occupying the leased portion to them (sic),
Judge, a complaint denominated as "Ejectment with Preliminary and/or that a Writ of Possession be immediately
Injunction and Damages" against respondents Vicente Medina and issued to preserve the rights of the herein plaintiff;
Fortunata Rosellon.
3. That judgment should be entered against the herein
The complaint alleged that the plaintiff (petitioner municipality defendants to vacate the premises of the leased
herein) is the owner of a parcel of residential land located at Poblacion, portion given to them. (CA Rollo, pp. 11-12)
Dumingag, Zamboanga del Sur with an area of 5,894 square meters
more or less; that the parcel of land was reserved for public plaza under On the same day, September 24, 1990, the petitioner Judge issued an
Presidential Proclamation No. 365 dated March 15, 1968; that during order setting the preliminary hearing for the issuance of a writ of
the incumbency of the late Mayor Isidoro E. Real, Sr. or in 1958, the
preliminary mandatory injunction and/or writ of possession on and public plaza under the administration of the
October 10, 1990. Municipality of Dumingag, therefore the Cadastral
court has no jurisdiction over the land involved in this
Instead of filing an answer, the respondents filed a motion to dismiss case. (CA Rollo, p. 20)
alleging the lack of jurisdiction of the trial court, since the complaint
is for illegal detainer which is within the original jurisdiction of the The petitioner Judge justified his granting the motion for a writ of
municipal court and the pendency of a cadastral case (Cadastral Case possession with the ancillary writ of demolition by applying the rule
No. N-10, LRC Cad. Rec. No. N-108, Lot 9481 [Pls-61] TS-218) an eminent domain (Rule 67 of the Revised Rules of Court,
between the parties over the ownership of the same parcel of land. erroneously referred to as Rule 68) in analogy in that under this Rule
the complainant is given the right to the writ of possession in order
On October 10, 1990, the petitioner Judge issued two (2) orders. The that public construction and projects will not be delayed. According
first order denied the motion to dismiss. The second order granted the to the petitioner Judge, the necessity of a writ of possession is greater
petitioner municipality's motion for a writ of possession "with the in the instant case considering that the parcel of land is covered by a
ancillary writ of demolition to place in possession the plaintiff on the Presidential Proclamation and the on-going construction thereon is
land subject of this case, to the end that the public construction thereon being endangered to be left unfinished on account of the buildings
will not be jeopardized." (CA Rollo, p. 22) standing on the parcel of land because the appropriation for the
construction might be reverted back to the national treasury.
In denying the motion to dismiss, the petitioner Judge said:
The private respondents filed an omnibus motion for reconsideration
xxx xxx xxx with motion to set aside order and to quash writ of possession and
demolition but this was denied in an order dated October 19, 1990.
2. In the complaint, the plaintiff alleges that the
defendant is claiming ownership over the land which On October 19, 1990, the petitioner municipality implemented the writ
was previously rented to defendant by the plaintiff of possession and ancillary writ of demolition issued by the petitioner
municipality. This action is, therefore, clearly Judge resulting in the dispossession of the private respondents from
an accion de reivindicacion, a real action within the the parcel of land and the demolition of structures and buildings
jurisdiction of this court. thereon owned by the respondents.

3. As the complaint is for recovery of ownership of On October 23, 1990, the private respondents filed their answer to the
the land not to enforce the contract, the Statute of complaint alleging therein that the subject parcel of land has been
Fraud does not apply. owned, occupied and possess by respondent Vicente Medina since
1947 when he bought the subject parcel from a Subanan native; that
4. The land subject of this case is covered by P.D. No. the other respondent Fortunata Rosellon leased from Medina a portion
365, withdrawing this land from sale of settlement of the parcel of land; that the respondents were never lessees of the
and reserving the same for school site purposes under petitioner municipality; that Proclamation No-365 issued on March
the administration of the Director of Public School 15, 1968 recognized "private rights"; and, that a case is pending before
the Cadastral court between respondent Medina and petitioner March 25, (should be 15) 1968, reserved for school
municipality as regards the ownership of the subject parcel of land. site and public plaza in the Municipality of Dumingag
and that the petitioners, to whom the former town
Before the petitioner Judge could further act on the case, the private mayor had leased a part of the land, refused to vacate
respondents filed a petition for certiorari with the Court of Appeals and to pay rents. If this is the theory on which the
questioning the October 10 and October 19, 1990 orders of the complaint is based, then the action may really be
petitioner Judge. considered one for recovery of possession. For
though a lease is alleged, the lease would be void and
In a resolution dated November 14, 1990, the petition was given due the municipality could recover the possession of the
course and a temporary restraining order was issued enjoining the land. This is the teaching of the leading case
petitioner Judge from proceeding with the hearing of the case and from of Municipality of Cavite v. Rojas, 30 Phil. 602 [1915]
enforcing the October 10, and 19, 1990 orders. in which it was held that the lease by a municipal
corporation of a public plaza is null and void because
On January 21, 1990, the appellate court rendered the questioned land for public use is outside the commerce of man
decision. A motion for reconsideration was denied in a resolution and, therefore, the lessee must restore possession of
dated February 20, 1991. the land by vacating it. As in this case, in the Rojas
case the action was for recovery of possession
instituted in the Court of First Instance, the
Hence, this petition.
counterpart of which at present is the Regional Trial
Court. We, therefore, hold that the respondent judge
In a resolution dated November 26, 1991, we gave due course to the
has jurisdiction of the case brought against petitioners
petition.
for recovery of possession of what is alleged to be
land for public use of the respondent municipality.
The appellate court rightfully upheld the jurisdiction of the Regional (CA Rollo, pp. 53-54)
Trial Court over the case based on the allegations in the complaint.
The allegations and not the title control the cause of action of the
Prescinding from the finding that the complaint is for recovery of
complaint. (Andamo v. Intermediate Appellate Court, 191 SCRA 195
possession the appellate court concluded that the trial court did not
[1990]).
have authority to issue a writ of possession and a writ of demolition
citing the case of Mabale v. Apalisok (88 SCRA 234 [1979]), to wit:
The Court said:
In that connection, it should be borne in mind that the
First, Does the Regional Trial Court have jurisdiction law specifies when a writ of possession may be
over the case brought by the Municipality of issued. That writ is available (1) in a land registration
Dimangag? As already noted, the gist of the proceeding, which is a proceeding in rem (Sec. 17,
complaint below is that the land in question is part of Act No. 496; Estipona v. Navarro, 69 SCRA 285,
the public domain which the President of the 291); (2) in an extra-judicial foreclosure of a realty
Philippines, under Proclamation No. 365, dated
 mortgage (Sec. 7, Act No. 3135); (3) in a judicial void. For the fact is that petitioners claim ownership
foreclosure of mortgage, a quasi in of the land in question and until that question is
rem proceeding, provided that the mortgagor is in resolved either in the case pending before the
possession of the mortgaged realty and no third respondent judge or in the cadastral proceeding, it
person, not party to the foreclosure suit, had would be unjust to deprive petitioners of its
intervened (Rivera v. Court of First Instance of Nueva possession. (CA Rollo, pp.
Ecija and Rupac, 61 Phil. 201; Ramos v. Mañalac and 55-56)
Lopez, 89 Phil. 270, 275) and (4) in execution sales
(last par. of sec. 35, Rule 39, Rules of Court). The petitioners now contend that the allegations in the complaint
constitute a cause of action for abatement of public nuisance under
The appellate court also ruled that the trial court committed an error Article 694 of the Civil Code. On the basis of this proposition, the
when it applied by analogy the rule on eminent domain (Rule 67, petitioners assert that petitioner municipality is entitled to the writ of
Revised Rules of Court) to justify the issuance of the writ of possession and writ of demolition.
possession and writ of demolition. The appellate court pointed out that
under this rule: Article 694 of the Civil Code defines nuisance as follows:

xxx xxx xxx Art. 694. A nuisance is any act, omission,

establishment, business, condition of property or
. . . (i) There is clear statutory authority for the taking anything else which:
of possession by the government and (ii) The
authority is premised on the government depositing xxx xxx xxx
the value of the land to be taken. For unless the taking
of the land is done under these conditions, the taking (5) Hinders or impairs the use of property.
would constitute deprivation of property without due
process of law which the Constitution prohibits. (See while Article 695 provides:
Manila Railroad Co. v. Paredes, 31 Phil. 118 [1915])
(CA Rollo, p. 55) Art. 695 Nuisance is either public or private. A public
nuisance affects a community or neighborhood or any
The appellate court then stated: considerable number of persons, although the extent
of the annoyance, danger or damage upon individuals
In the case at bar, there is neither statutory authority may be unequal. . . .
for the trial court's action nor bond given to
compensate the petitioners for the deprivation of their Applying these criteria, we agree with the petitioners that the
possession and the destruction of their houses if it complaint alleges factual circumstances of a complaint for abatement
turns out that the land belongs to them. For this of public nuisance. Thus, the complaint states: that petitioner
reason, we think the trial courts order is arbitrary and municipality is the owner of a parcel of land covered by Presidential
Proclamation No 365 which is reserved for a public plaza; that the On the premise that the parcel of land forms part of a public plaza, the
private respondents by virtue of a contract of lease entered into by the petitioners now contend that the Judge was justified in issuing the writ
former mayor occupied a portion of the parcel of land constructing of possession and writ of demolition.
buildings thereon; that the private respondents refused to vacate the
premises despite demands; that the municipality is constructing a A public plaza is outside the commerce of man and constructions
municipal gymnasium in the area financed by thereon can be abated summarily by the municipality. We ruled in the
appropriations provided by the national government; and that the case of Villanueva v. Castañeda, Jr. (154 SCRA 142 [1987]):
appropriations are in danger of being reverted to the national treasury
because the construction had to be stopped in view of the refusal of Exactly in point is Espiritu v. Municipal Council of
the private respondents to vacate the area. Pozorrubio, (102 Phil. 869-870) where the Supreme
Court declared:
The issue, however, is not the nature of the cause of action alleged in
the complaint. The more important question is whether or not the There is absolutely no question that
petitioner municipality is entitled to a writ of possession and a writ of the town plaza cannot be used for the
demolition even before the trial of the case starts. construction of market stalls,
specially of residences, and that such
Article 699 of the Civil Code provides for the following remedies structures constitute a nuisance
against a public nuisance: subject to abatement according to
law. Town plazas are properties of
(1) A prosecution under the Penal Code or any local public dominion, to be devoted to
ordinance; or public use and to be made available
to the public in general. They are
(2) A civil action; or outside the commerce of man and
cannot be disposed of or even leased
(3) Abatement, without judicial proceedings. by the municipality to private parties.

The petitioner municipality had three remedies from which to select Applying this well-settled doctrine, we rule that
its cause of action. It chose to file a civil action for the recovery of petitioners had no right in the first place to occupy the
possession of the parcel of land occupied by the private respondents. disputed premises and cannot insist in remaining
Obviously, petitioner municipality was aware that under the then there now on the strength of their alleged lease
Local Government Code (B.P. Blg. 337) the Sangguniang Bayan has contracts. They should have realized and accepted
to first pass an ordinance before the municipality may summarily abate this earlier, considering that even before Civil Case
a public nuisance. (Sec. 149(z) (ee). No. 2040 was decided, the municipal council of San
Fernando had already adopted Resolution No. 29,
series of 1964, declaring this area as the parking place
and public plaza of the municipality.
 It is the decision in Civil Case No. 2040 and the said We have to consider the fact that Proclamation No. 365 dated March
resolution of the municipal council of San Fernando 15, 1968 recognizes private rights which may have been vested on
that respondent Macalino was seeking to enforce other persons, to wit:
when he ordered the demolition of the stalls
constructed in the disputed area. As officer-in-charge BY THE PRESIDENT OF THE PHILIPPINES
of the office of the mayor, he had the duty to clear the PROCLAMATION NO. 365
area and restore it to its intended use as a parking
place and public plaza of the municipality of San RESERVING FOR SCHOOL SITE, PUBLIC
Fernando, conformably to the aforementioned orders PLAZA AND PLAYGROUND PURPOSES
from the court and the council. It is, therefore, not CERTAIN PARCELS OF LAND OF THE PUBLIC
correct to say that he had acted without authority or DOMAIN SITUATED IN THE MUNICIPALITY
taken the law into his hands in issuing his order. OF DUMINGAG, PROVINCE OF ZAMBOANGA
DEL SUR, ISLAND OF MINDANAO.
xxx xxx xxx
Upon recommendation of the Secretary of
The Court observes that even without such Agriculture and Natural Resources and pursuant to
investigatiom and recommendation, the respondent the authority vested in me by law, I FERDINAND E.
mayor was justified in ordering the area cleared on the MARCOS, PRESIDENT OF THE PHILIPPINES, do
strength alone of its status as a public plaza as hereby withdraw from sale or settlement and under
declared by the judicial and legislative authorities. . . the administration of the Director of Public Schools
. administration of the Municipal Government of
Dumingag, subject to private rights, if any there be,
If, therefore, the allegations in the complaint are true and that the certain parcels of land of the public domain situated
parcel of land being occupied by the private respondents is indeed a in the Municipality of Dumingag, Province of
public plaza, then the writ of possession and writ of demolition would Zamboanga del Sur, Island of Mindanao, . . .
have been justified. In fact, under such circumstances, there would (CA Rollo, pp. 41-A — 42) (Emphasis supplied).
have been no need for a writ of possession in favor of the petitioner
municipality since the private respondents' occupation over the subject It is to be noted that even before the Proclamation, the parcel of land
parcel of land can not be recognized by any law. A writ of demolition was the subject of cadastral proceedings before another branch of the
would have been sufficient to eject the private respondents. Regional Trial Court of Zamboanga del Sur. At the time of the filing
of the instant case, the cadastral proceedings intended to settle the
However, not only did the municipality avoid the use of abatement ownership over the questioned portion of the parcel of land under
without judicial proceedings, but the status of the subject parcel of Proclamation No. 365 were still pending. One of the claimants in the
land has yet to be decided. cadastral proceedings is private respondent Vicente Medina who
traced his ownership over the subject parcel of land as far back as 1947
when he allegedly bought the same from a Subanan native.
Under the cadastral system, the government through the Director of prejudicial question in a civil case is alleged in the
Lands initiates the proceedings by filing a petition in court after which criminal case to cause the suspension of the latter
all owners or claimants are compelled to act and present their answers pending final determination of the former.
otherwise they lose their right to their own property. The purpose is to
serve the public interests by requiring that the titles to any lands "be The essential elements of a prejudicial question
settled and adjudicated." (Section 1 Cadastral Act [No. 22593] as provided under Section 5, Rule 111 of the Revised
Government of the Philippine Islands v. Abural, 39 Phil. 996 [1919]. Rules of Court area: [a] the civil action involves an
It is a proceeding in rem somewhat akin to a judicial inquiry and issue similar or intimately related to the issue in the
investigation leading to a judicial decree. (Director of Lands v. Roman criminal action; and [b] the resolution of such issue
Archbishop of Manila, 41 Phil. 120 [1920]) determines whether or not the criminal action may
proceed.
Considering therefore, the nature and purpose of the Cadastral
proceedings, the outcome of said proceedings becomes a prejudicial The actions involved in the case at bar being
question which must be addressed in the resolution of the instant case. respectively civil and administrative in character, it is
We apply by analogy the ruling in the case of Quiambao obvious that technically, there is no prejudicial
v. Osorio (158 SCRA 674 [1988]), to wit: question to speak of. Equally apparent, however, is
the intimate correlation between said two [2]
The instant controversy boils down to the sole proceedings, stemming from the fact that the right of
question of whether or not the administrative case private respondents to eject petitioner from the
between the private parties involving the lot subject disputed portion depends primarily on the resolution
matter of the ejectment case constitutes a prejudicial of the pending administrative case. For while it may
question which would operate as a bar to said be true that private respondents had prior possession
ejectment case. of the lot in question, at the time of the institution of
the ejectment case, such right of possession had been
A prejudicial question is understood in law to be that terminated, or at the very least, suspended by the
which arises in a case the resolution of which is a cancellation by the Land Authority of the Agreement
logical antecedent of the issue involved in said case to Sell executed in their favor. Whether or not private
and the cognizance of which pertains to another respondents can continue to exercise their right of
tribunal. (Zapanta v. Montesa, 4 SCRA 510 [1962]; possession is but a necessary, logical consequence of
People v. Aragon, 50 O.G. No. 10, 4863) The doctrine the issue involved in the pending administrative case
of prejudicial question comes as in to play generally assailing the validity of the cancellation of the
in a situation where civil and criminal actions are Agreement to Sell and the subsequent award of the
pending and the issues involved in bath cases are disputed portion to petitioner. If the cancellation of
similar or so closely-related that an issue must be pre- the agreement, to Sell and the subsequent award to
emptively resolved in the civil case before the petitioner are voided, then private respondent's right
criminal action can proceed. Thus, the existence it a
of possession is lost and so would their right to eject While this rule is properly applicable to instances
petitioner from said portion. involving two [2] court actions, the existence in the
instant case of the same considerations of identity of
Faced with these distinct possibilities, the more parties and issues, economy of time and effort for the
prudent course for the trial court to have taken is to court, the counsels and the parties as well as the need
hold the ejectment proceedings in abeyance until after to resolve the parties' right of possession before the
a determination of the administrative case. Indeed, ejectment case may be properly determined, justifies
logic and pragmatism, if not jurisprudence, dictate the rule's analogous application to the case at bar.
such move. To allow the parties to undergo trial
notwithstanding the possibility of petitioner's right of Technically, a prejudicial question shall not rise in the instant case
possession being upheld in the pending since the two actions involved are both civil in nature. However, we
administrative case is to needlessly require not only have to consider the fact that the cadastral proceedings will ultimately
the parties but the court as well to expend time, effort settle the real owner/s of the disputed parcel of land. In case
in what may turn out to be a sheer exercise in futility. respondent Vicente Medina is adjudged the real owner of the parcel of
Thus, 1 Am Jur 2d land, then the writ of possession and writ of demolition would
tells us: necessarily be null and void. Not only that. The demolition of the
constructions in the parcel of land would prove truly unjust to the
The court in which an action is private respondents.
pending may, in the exercise of a
sound discretion, upon proper Parenthetically, the issuance of the writ of possession and writ of
application for a stay of that action, demolition by the petitioner Judge in the ejectment proceedings was
hold the action in abeyance to abide premature. What the petitioner should have done was to stop the
the outcome of another pending in proceedings in the instant case and wait for the final outcome of the
another court, especially where the cadastral proceedings.
parties and the issues are the same,
for there is power inherent in every At any rate, affirmative relief based an the above discussions is no
court to control the disposition of longer possible. The demolition of the buildings owned by the private
causes an its dockets with economy respondents is now a fait accompli.
of time and effort for itself, for
counsel, and for litigants. Where the In the case of Estate of Gregoria Francisco v. Court of Appeals (199
rights of parties in the record action SCRA 595 [1991] we awarded just compensation the amount of which
cannot be properly determined until was for the trial court to determine in favor of the petitioner whose
the questions raised in the first action building was demolished by the municipality even before a proper
are settled the second action should tribunal could decide whether or not the building constituted a
be stayed. nuisance in law. Our ruling was premised on the ground that the owner
of the building was in lawful possession of the lot and the building by
virtue of the permit from the authorized government agency when the eminent domain and the propriety of
demolition was effected. its exercise in the content of the facts
involved in the suit. (Citing Sections
We cannot, however, apply this ruling to the present case. The legality 1, 2 and 3, Rule 67 of the Rules of
of the occupation by the private respondents of the subject parcel of Court.) It ends with an order, if not of
land is still to be resolved in the cadastral proceedings. In the event dismissal of the action, "of
that respondent Vicente Medina is declared owner of the subject parcel condemnation declaring that the
of land, necessarily, the private respondents would be entitled to just plaintiff has a lawful right to take the
compensation for the precipitate demolition of their buildings. On the property sought to be condemned,
other hand, if private respondent Medina is declared to have no rights for the public use or purpose
over the subject parcel of land then, the private respondents would not described in the complaint, upon the
be entitle to any compensation for the demolition of their buildings. In payment of just compensation to be
such a case the private respondents are considered squatters and determined as of the date of the filing
therefore, the demolition of their buildings would turnout to have been of the complaint." (Citing Section 4,
justified. Rule 67; Nieto v. Isip, 97 Phil. 31;
Benguet Consolidated v. Republic,
Faced with these alternative possibilities, and in the interest of justice, 143 SCRA 466.)An order of
we rule that the petitioner municipality must put up a bond to be dismissal, if this be ordained, would
determined by the trial court to answer for just compensation to which be a final one, of course, since it
the private respondents may be entitled in case the demolition of their finally disposes of the action and
buildings is adjudged to be illegal. leaves nothing more to be done by
the Court on the merits.
Moreover, the appellate court correctly ruled this Rule 67 of the (Citing Investments, Inc. v. Court of
Revised Rules of Court on eminent domain can not be made a Appeals, et al., 147 SCRA 334) So,
subterfuge to justify the petitioner Judge's issuance of a writ of too, would an order of condemnation
possession in favor of petitioner municipality. In the recent case on be a final one, for thereafter as the
of National Power Corporation v. Hon. Enrique T. Jocson, et al. (G.R. rules expressly state, in the
No. 94193-99, February 25, 1992) we said: proceedings before the Trial Court,
"no objection to the exercise of the
In Municipality of Biñan v. Hon. Jose Mar Garcia, et right of condemnation (or the
propriety thereof) shall be filed or
al. (180 SCRA 576 [1989]) this Court ruled that there
are two (2) stages in every action of expropriation: — heard.

The first is concerned with the The second phase of the eminent
determination of the authority of the domain action is concerned with the
plaintiff to exercise the power of determination to the Court of "the
 just compensation in for the property Another point raised by the petitioners questions the alleged ruling of
sought to be taken." This is done by the appellate court "that the petitioners are personally liable for
the Court with the assistance of not damages to the private respondents for the abatement of public
more than three (3) commissioners nuisance." (Rollo, p. 50)
(Citing Sections 5 to 8, Rule 67 of the
Rules of Court) The order fixing the The petitioners misread the appellate court's decision. The records
just compensation on the basis of the show Chat the private respondents prayed for, in their petition
evidence before, and findings of, the for certiorari filed with the appellate court, among others:
commissioners would be final, too. It
would finally dispose of the second It is likewise, prayed that respondents be ordered to
stage of the suit, and leave nothing pay jointly and severally the value of the house
more to be done by the Court illegally demolished in the amount of P1,000.00 00,
regarding the issue. . . . attorney's fees in the amount of P50,000.00, moral
damages in the amount of P100,000.00 and
However, upon the filing of the complaint or at any exemplary damages in the amount of P50,000.00, to
time thereafter, the petitioner has the right to take pay the costs, . . .
enter upon the possession of the property involved
upon compliance with P.D. No. 42 which requires the xxx xxx xxx
petitioner, after due notice to the defendant, to deposit
with the Philippine National Bank in its main office (CA Rollo, p. 6)
or any of its branches or agencies, "an amount
equivalent to the assessed value of the property for
In response to this prayer, however, the appellate court stated:
purposes of taxation." This assessed value is that
indicated in the tax declaration.
We do not, however, have jurisdiction over
petitioners' claim for damages. This must be pursued
Hence, even if we concede that Rule 67 is applicable to the instant in an appropriate action instituted in the Regional
case and that petitioner municipality had the lawful right to eject the Trial Court. (Rollo, p. 26)
private respondents from the subject parcel of land the issuance of a
writ of possession in favor of petitioner municipality would still not
Moreover, the dispositive portion of the decision does not mention any
be legal if the petitioner municipality really owns the land. The Judge
personal liability for damages against the petitioners. The
did not require petitioner municipality to deposit an amount equivalent
to the just compensation due the private respondents as provided for apprehension of the petitioners lacks factual basis.
under Presidential Decree 42. It is only after the deposit of the just
compensation that petitioner municipality would be entitled to a writ WHEREFORE, the instant petition is DISMISSED. The questioned
of possession. decision and resolution of the Court of Appeals are AFFIRMED. The
trial court is ordered to require the petitioner municipality to put up a
bond to be determined by the court after hearing to answer, for just
compensation due the private respondents in case the demolition of
their buildings is adjudged to be illegal. The "Motion to Declare in
Contempt" filed by petitioner Judge is referred to the Regional Trial
Court of Pagadian City, Branch 18 in Civil Case No. 3156 for
appropriate action.

SO ORDERED.
G.R. No. 147902 March 17, 2006 or soon thereafter in front of the Justice Hall, Bonuan, Tondaligan,
Dagupan City.7
SPOUSES VICENTE YU AND DEMETRIA LEE-
YU, Petitioners, At the auction sale on September 10, 1998, respondent emerged as the
vs. highest bidder.8 On September 14, 1998, a Certificate of Sale was
PHILIPPINE COMMERCIAL INTERNATIONAL issued in favor of respondent.9 On October 1, 1998, the sale was
BANK, Respondent. registered with the Registry of Deeds of Dagupan City.

DECISION About two months before the expiration of the redemption period, or
on August 20, 1999, respondent filed an Ex-Parte Petition for Writ of
AUSTRIA-MARTINEZ, J.: Possession before the Regional Trial Court of Dagupan City, docketed
as Special Proceeding No. 99-00988-D and raffled to Branch 43 (RTC
Before the Court is a Petition for Review on Certiorari of the Branch 43).10 Hearing was conducted on September 14, 1999 and
Decision1 dated November 14, 2000 of the Court of Appeals (CA) in respondent presented its evidence ex-parte.11 The testimony of
CA-G.R. SP No. 58982 and the CA Resolution dated April 26, 2001, Rodante Manuel was admitted ex-parte and thereafter the petition was
which denied petitioner’s Motion for Reconsideration. deemed submitted for resolution.

The factual background of the case is as follows: On September 30, 1999, petitioners filed a Motion to Dismiss and to
Strike Out Testimony of Rodante Manuel stating that the Certificate
Under a Real Estate Mortgage dated August 15, 19942 and of Sale dated September 14, 1998 is void because respondent violated
Amendments of Real Estate Mortgage dated April 4, 19953 and Article 2089 of the Civil Code on the indivisibility of the mortgaged
December 4, 1995,4 spouses Vicente Yu and Demetria Lee-Yu by conducting two separate foreclosure proceedings on the mortgage
(petitioners) and spouses Ramon T. Yu and Virginia A. Tiu, or Yu properties in Dagupan City and Quezon City and indicating in the two
Tian Hock aka Victorino/Vicente Yu, mortgaged their title, interest, notices of extra-judicial sale that petitioners’ obligation
and participation over several parcels of land located in Dagupan City is P10,437,015.2012 as of March 31, 1998, when petitioners are not
and Quezon City, in favor of the Philippine Commercial International indebted for the total amount of P20,874,031.56.13
Bank (respondent) as security for the payment of a loan in the amount
of P9,000,000.00.5 In the meantime, petitioners filed a complaint for Annulment of
Certificate of Sale before the Regional Trial Court of Dagupan City,
As the petitioners failed to pay the loan, the interest, and the penalties docketed as Civil Case No. 99-03169-D and raffled to Branch 44
due thereon, respondent filed on July 21, 1998 with the Office of the (RTC Branch 44).
Clerk of Court and Ex-Officio Sheriff of the Regional Trial Court of
Dagupan City a Petition for Extra-Judicial Foreclosure of Real Estate On February 14, 2000, RTC Branch 43 denied petitioners’ Motion to
Mortgage on the Dagupan City properties. 6 On August 3, 1998, the Dismiss and to Strike Out Testimony of Rodante Manuel, ruling that
City Sheriff issued a Notice of Extra-Judicial Sale scheduling the the filing of a motion to dismiss is not allowed in petitions for issuance
auction sale on September 10, 1998 at 10:00 o’clock in the morning of writ of possession under Section 7 of Act No. 3135. 14
On February 24, 2000, petitioners filed a Motion for Reconsideration, A. Whether or not a real estate mortgage over several
further arguing that the pendency of Civil Case No. 99-03169-D in properties located in different locality [sic] can be separately
RTC Branch 44 is a prejudicial issue to Spec. Proc. No. 99-00988-D foreclosed in different places.
in RTC Branch 43, the resolution of which is determinative on the
propriety of the issuance of a writ of possession. 15 B. Whether or not the pendency of a prejudicial issue renders
the issues in Special Proceedings No. 99-00988-D as [sic]
On May 8, 2000, RTC Branch 43 denied petitioners’ Motion for moot and academic.21
Reconsideration, holding that the principle of prejudicial question is
not applicable because the case pending before RTC Branch 44 is also Anent the first issue, petitioners contend that since a real estate
a civil case and not a criminal case.16 mortgage is indivisible, the mortgaged properties in Dagupan City and
Quezon City cannot be separately foreclosed. Petitioners further point
On June 1, 2000, petitioners filed a Petition for Certiorari with the out that two notices of extra-judicial sale indicated that petitioners’
CA.17 On November 14, 2000, the CA dismissed petitioners’ Petition obligation is P10,437,015.2022 each as of March 31, 1998 or a total
for Certiorari on the grounds that petitioners violated Section 8 of Act of P20,874,030.40,23 yet their own computation yields
No. 3135 and disregarded the rule against multiplicity of suits in filing only P9,957,508.90 as of February 27, 1998.
Civil Case No. 99-03169-D in RTC Branch 44 despite full knowledge
of the pendency of Spec. Proc. No. 99-00988-D in RTC Branch 43; As to the second issue, petitioners posit that the pendency of Civil
that since the one-year period of redemption has already lapsed, the Case No. 99-03169-D is a prejudicial issue, the resolution of which
issuance of a writ of possession in favor of respondent becomes a will render the issues in Spec. Proc. No. 99-00988-D moot and
ministerial duty of the trial court; that the issues in Civil Case No. 99- academic. Petitioners further aver that they did not violate Section 8
03169-D are not prejudicial questions to Spec. Proc. No. 99-00988-D of Act No. 3135 in filing a separate case to annul the certificate of sale
because: (a) the special proceeding is already fait accompli, (b) Civil since the use of the word "may" in said provision indicates that they
Case No. 99-03169-D is deemed not filed for being contrary to Section have the option to seek relief of filing a petition to annul the certificate
8 of Act No. 3135, (c) the filing of Civil Case No. 99-03169-D is an of sale in the proceeding involving the application for a writ of
afterthought and dilatory in nature, and (d) legally speaking what possession or in a separate proceeding.
seems to exist is litis pendentia and not prejudicial question. 18
Respondent contends24 that, with respect to the first issue, the filing of
19
Petitioners filed a Motion for Reconsideration but it was denied by two separate foreclosure proceedings did not violate Article 2089 of
the CA on April 26, 2001.20 the Civil Code on the indivisibility of a real estate mortgage since
Section 2 of Act No. 3135 expressly provides that extra-judicial
Hence, the present Petition for Review on Certiorari. foreclosure may only be made in the province or municipality where
the property is situated. Respondent further submits that the filing of
Petitioners pose two issues for resolution, to wit: separate applications for extra-judicial foreclosure of mortgage
involving several properties in different locations is allowed by A.M.
No. 99-10-05-0, the Procedure on Extra-Judicial Foreclosure of
Mortgage, as further amended on August 7, 2001.
As to the second issue, respondent maintains that there is no From these provisions is excepted the case in which, there being
prejudicial question between Civil Case No. 99-03169-D and Spec. several things given in mortgage or pledge, each one of them
Proc. No. 99-00988-D since the pendency of a civil action questioning guarantees only a determinate portion of the credit.
the validity of the mortgage and the extra-judicial foreclosure thereof
does not bar the issuance of a writ of possession. Respondent also The debtor, in this case, shall have a right to the extinguishment of the
insists that petitioners should have filed their Petition to Annul the pledge or mortgage as the portion of the debt for which each thing is
Certificate of Sale in the same case where possession is being sought, specially answerable is satisfied.
that is, in Spec. Proc. No. 99-00988-D, and not in a separate
proceeding (Civil Case No. 99-01369-D) because the venue of the This rule presupposes several heirs of the debtor or creditor 25 and
action to question the validity of the foreclosure is not discretionary therefore not applicable to the present case. Furthermore, what the law
since the use of the word "may" in Section 8 of Act No. 3135 refers to proscribes is the foreclosure of only a portion of the property or a
the filing of the petition or action itself and not to the venue. number of the several properties mortgaged corresponding to the
Respondent further argues that even if petitioners filed the Petition to unpaid portion of the debt where, before foreclosure proceedings,
Annul the Certificate of Sale in Spec. Proc. No. 99-00988-D, the writ partial payment was made by the debtor on his total outstanding loan
of possession must still be issued because issuance of the writ in favor or obligation. This also means that the debtor cannot ask for the release
of the purchaser is a ministerial act of the trial court and the one-year of any portion of the mortgaged property or of one or some of the
period of redemption has already lapsed. several lots mortgaged unless and until the loan thus secured has been
fully paid, notwithstanding the fact that there has been partial
Anent the first issue, the Court finds that petitioners have a mistaken fulfillment of the obligation. Hence, it is provided that the debtor who
notion that the indivisibility of a real estate mortgage relates to the has paid a part of the debt cannot ask for the proportionate
venue of extra-judicial foreclosure proceedings. The rule on extinguishment of the mortgage as long as the debt is not completely
indivisibility of a real estate mortgage is provided for in Article 2089 satisfied.26 In essence, indivisibility means that the mortgage
of the Civil Code, which provides: obligation cannot be divided among the different lots, 27 that is, each
and every parcel under mortgage answers for the totality of the debt. 28
Art. 2089. A pledge or mortgage is indivisible, even though the debt
may be divided among the successors in interest of the debtor or of the On the other hand, the venue of the extra-judicial foreclosure
creditor. proceedings is the place where each of the mortgaged property is
located, as prescribed by Section 2 of Act No. 3135, 29 to wit:
Therefore, the debtor’s heir who has paid a part of the debt cannot ask
for the proportionate extinguishment of the pledge or mortgage as the SECTION 2. Said sale cannot be made legally outside of the province
debt is not completely satisfied. in which the property sold is situated; and in case the place within said
province in which the sale is to be made is subject to stipulation, such
Neither can the creditor’s heir who received his share of the debt return sale shall be made in said place or in the municipal building of the
the pledge or cancel the mortgage, to the prejudice of the other heirs municipality in which the property or part thereof is situated.
who have not been paid.
A.M. No. 99-10-05-0,30 the Procedure on Extra-Judicial Foreclosure A prejudicial question is one that arises in a case the resolution of
of Mortgage, lays down the guidelines for extra-judicial foreclosure which is a logical antecedent of the issue involved therein, and the
proceedings on mortgaged properties located in different provinces. It cognizance of which pertains to another tribunal. It generally comes
provides that the venue of the extra-judicial foreclosure proceedings into play in a situation where a civil action and a criminal action are
is the place where each of the mortgaged property is located. Relevant both pending and there exists in the former an issue that must be
portion thereof provides: preemptively resolved before the criminal action may proceed,
because howsoever the issue raised in the civil action is resolved
Where the application concerns the extrajudicial foreclosure of would be determinative juris et de jure of the guilt or innocence of the
mortgages of real estates and/or chattels in different locations covering accused in the criminal case. The rationale behind the principle of
one indebtedness, only one filing fee corresponding to such prejudicial question is to avoid two conflicting decisions.
indebtedness shall be collected. The collecting Clerk of Court shall,
apart from the official receipt of the fees, issue a certificate of payment In the present case, the complaint of the petitioners for Annulment of
indicating the amount of indebtedness, the filing fees collected, the Extrajudicial Sale is a civil action and the respondent’s petition for the
mortgages sought to be foreclosed, the real estates and/or chattels issuance of a writ of possession of Lot No. 3-A, Block 1, Psd-07-
mortgaged and their respective locations, which certificate shall 021410, TCT No. 44668 is but an incident in the land registration case
serve the purpose of having the application docketed with the and, therefore, no prejudicial question can arise from the existence of
Clerks of Court of the places where the other properties are the two actions. A similar issue was raised in Manalo v. Court of
located and of allowing the extrajudicial foreclosures to proceed Appeals, where we held that:
thereat. (Emphasis supplied)
At any rate, it taxes our imagination why the questions raised in Case
The indivisibility of the real estate mortgage is not violated by No. 98-0868 must be considered determinative of Case No. 9011. The
conducting two separate foreclosure proceedings on mortgaged basic issue in the former is whether the respondent, as the purchaser
properties located in different provinces as long as each parcel of land in the extrajudicial foreclosure proceedings, may be compelled to have
is answerable for the entire debt. Petitioners’ assumption that their the property repurchased or resold to a mortgagor’s successor-in-
total obligation is P20,874,030.40 because the two notices of extra- interest (petitioner); while that in the latter is merely whether the
judicial sale indicated that petitioners’ obligation respondent, as the purchaser in the extrajudicial foreclosure
is P10,437,015.2031 each, is therefore flawed. Considering the proceedings, is entitled to a writ of possession after the statutory
indivisibility of a real estate mortgage, the mortgaged properties in period for redemption has expired. The two cases, assuming both are
Dagupan City and Quezon City are made to answer for the entire debt pending, can proceed separately and take their own direction
of P10,437,015.29.32 independent of each other.34

As to the second issue, that is, whether a civil case for annulment of a In the present case, Civil Case No. 99-01369-D and Spec. Proc. No.
certificate of sale is a prejudicial question to a petition for issuance of 99-00988-D are both civil in nature. The issue in Civil Case No. 99-
a writ of possession, this issue is far from novel and, in fact, not 01369-D is whether the extra-judicial foreclosure of the real estate
without precedence. In Pahang v. Vestil, 33 the Court said: mortgage executed by the petitioners in favor of the respondent and
the sale of their properties at public auction are null and void, whereas,
the issue in Spec. Proc. No. 99-00988-D is whether the respondent is already issued a writ of possession. In Sps. Ong v. Court of
entitled to a writ of possession of the foreclosed properties. Clearly, Appeals,36 the Court elucidated:
no prejudicial question can arise from the existence of the two actions.
The two cases can proceed separately and take their own direction The law is clear that the purchaser must first be placed in possession
independently of each other. of the mortgaged property pending proceedings assailing the issuance
of the writ of possession. If the trial court later finds merit in the
Nevertheless, there is a need to correct the CA’s view that petitioners petition to set aside the writ of possession, it shall dispose in favor of
violated Section 8 of Act No. 3135 and disregarded the proscription the mortgagor the bond furnished by the purchaser. Thereafter, either
on multiplicity of suits by instituting a separate civil suit for annulment party may appeal from the order of the judge in accordance with
of the certificate of sale while there is a pending petition for issuance Section 14 of Act 496, which provides that "every order, decision, and
of the writ of possession in a special proceeding. decree of the Court of Land Registration may be reviewed…in the
same manner as an order, decision, decree or judgment of a Court of
Section 8 of Act No. 3135 provides: First Instance (RTC) might be reviewed." The rationale for the
mandate is to allow the purchaser to have possession of the foreclosed
Sec. 8. Setting aside of sale and writ of possession. – The debtor may, property without delay, such possession being founded on his right of
in the proceedings in which possession was requested, but not later ownership.37
than thirty days after the purchaser was given possession, petition that
the sale be set aside and the writ of possession cancelled, specifying Accordingly, Section 8 of Act No. 3135 is not applicable to the present
the damages suffered by him, because the mortgage was not violated case since at the time of the filing of the separate civil suit for
or the sale was not made in accordance with the provisions hereof, and annulment of the certificate of sale in RTC Branch 44, no writ of
the court shall take cognizance of this petition in accordance with the possession was yet issued by RTC Branch 43.
summary procedure provided for in section one hundred and twelve
of Act Numbered Four hundred and ninety-six; and if it finds the Similarly, the Court rejects the CA’s application of the principle of
complaint of the debtor justified, it shall dispose in his favor of all or litis pendentia to Civil Case No. 99-03169-D in relation to Spec. Proc.
part of the bond furnished by the person who obtained possession. No. 99-00988-D. Litis pendentia refers to that situation wherein
Either of the parties may appeal from the order of the judge in another action is pending between the same parties for the same cause
accordance with section fourteen of Act Numbered Four hundred and of actions and that the second action becomes unnecessary and
ninety-six; but the order of possession shall continue in effect during vexatious. For litis pendentia to be invoked, the concurrence of the
the pendency of the appeal. (Emphasis supplied) following requisites is necessary: (a) identity of parties or at least such
as represent the same interest in both actions; (b) identity of rights
Under the provision above cited, the mortgagor may file a petition to asserted and reliefs prayed for, the reliefs being founded on the same
set aside the sale and for the cancellation of a writ of possession with facts; and, (c) the identity in the two cases should be such that the
the trial court which issued the writ of possession within 30 days after judgment that may be rendered in one would, regardless of which
the purchaser mortgagee was given possession. It provides the plain, party is successful, amount to res judicata in the other.38
speedy, and adequate remedy in opposing the issuance of a writ of
possession.35 Thus, this provision presupposes that the trial court
Applying the foregoing criteria in the instant case, litis pendentia does SO ORDERED.
not obtain in this case because of the absence of the second and third
requisites. The issuance of the writ of possession being
a ministerial function, and summary in nature, it cannot be said to be
a judgment on the merits, but simply an incident in the transfer of title.
Hence, a separate case for annulment of mortgage and foreclosure sale
cannot be barred by litis pendentia or res judicata.39 Thus, insofar as
Spec. Proc. No. 99-00988-D and Civil Case No. 99-03169-D pending
before different branches of RTC Dagupan City are concerned, there
is no litis pendentia.

To sum up, the Court holds that the rule on indivisibility of the real
estate mortgage cannot be equated with the venue of foreclosure
proceedings on mortgaged properties located in different provinces
since these are two unrelated concepts. Also, no prejudicial question
can arise from the existence of a civil case for annulment of a
certificate of sale and a petition for the issuance of a writ of possession
in a special proceeding since the two cases are both civil in nature
which can proceed separately and take their own direction
independently of each other.

Furthermore, since the one-year period to redeem the foreclosed

properties lapsed on October 1, 1999, title to the foreclosed properties
had already been consolidated under the name of the respondent. As
the owner of the properties, respondent is entitled to its possession as
a matter of right.40 The issuance of a writ of possession over the
properties by the trial court is merely a ministerial function. As such,
the trial court neither exercises its official discretion nor
judgment.41 Any question regarding the validity of the mortgage or its
foreclosure cannot be a legal ground for refusing the issuance of a writ
of possession.42 Regardless of the pending suit for annulment of the
certificate of sale, respondent is entitled to a writ of possession,
without prejudice of course to the eventual outcome of said case. 43

WHEREFORE, the petition is DENIED.

G.R. No. 138509 July 31, 2000 A prejudicial question is one which arises in a case the resolution of
which is a logical antecedent of the issue involved therein. 3 It is a
IMELDA MARBELLA-BOBIS, petitioner, question based on a fact distinct and separate from the crime but so
vs. intimately connected with it that it determines the guilt or innocence
ISAGANI D. BOBIS, respondent. of the accused.4 It must appear not only that the civil case involves
facts upon which the criminal action is based, but also that the
YNARES-SANTIAGO, J.: resolution of the issues raised in the civil action would necessarily be
determinative of the criminal case.5 Consequently, the defense must
On October 21, 1985, respondent contracted a first marriage with one involve an issue similar or intimately related to the same issue raised
Maria Dulce B. Javier. Without said marriage having been annulled, in the criminal action and its resolution determinative of whether or
nullified or terminated, the same respondent contracted a second not the latter action may proceed. 6 Its two essential elements are:7
marriage with petitioner Imelda Marbella-Bobis on January 25, 1996
and allegedly a third marriage with a certain Julia Sally Hernandez. (a) the civil action involves an issue similar or intimately
Based on petitioner's complaint-affidavit, an information for bigamy related to the issue raised in the criminal action; and
was filed against respondent on February 25, 1998, which was
docketed as Criminal Case No. Q98-75611 of the Regional Trial (b) the resolution of such issue determines whether or not the
Court, Branch 226, Quezon City. Sometime thereafter, respondent criminal action may proceed.
initiated a civil action for the judicial declaration of absolute nullity of
his first marriage on the ground that it was celebrated without a A prejudicial question does not conclusively resolve the guilt or
marriage license. Respondent then filed a motion to suspend the innocence of the accused but simply tests the sufficiency of the
proceedings in the criminal case for bigamy invoking the pending civil allegations in the information in order to sustain the further
case for nullity of the first marriage as a prejudicial question to the prosecution of the criminal case. A party who raises a prejudicial
criminal case. The trial judge granted the motion to suspend the question is deemed to have hypothetically admitted that all the
criminal case in an Order dated December 29, 1998. 1 Petitioner filed essential elements of a crime have been adequately alleged in the
a motion for reconsideration, but the same was denied. information, considering that the prosecution has not yet presented a
single evidence on the indictment or may not yet have rested its case.
Hence, this petition for review on certiorari. Petitioner argues that A challenge of the allegations in the information on the ground of
respondent should have first obtained a judicial declaration of nullity prejudicial question is in effect a question on the merits of the criminal
of his first marriage before entering into the second marriage, charge through a non-criminal suit.
inasmuch as the alleged prejudicial question justifying suspension of
the bigamy case is no longer a legal truism pursuant to Article 40 of Article 40 of the Family Code, which was effective at the time of
the Family Code. 2 celebration of the second marriage, requires a prior judicial declaration
of nullity of a previous marriage before a party may remarry. The clear
The issue to be resolved in this petition is whether the subsequent implication of this is that it is not for the parties, particularly the
filing of a civil action for declaration of nullity of a previous marriage accused, to determine the validity or invalidity of the
constitutes a prejudicial question to a criminal case for bigamy. marriage.8 Whether or not the first marriage was void for lack of a
license is a matter of defense because there is still no judicial five years.11 The issue in this case is limited to the existence of a
declaration of its nullity at the time the second marriage was prejudicial question, and we are not called upon to resolve the validity
contracted. It should be remembered that bigamy can successfully be of the first marriage. Be that as it may, suffice it to state that the Civil
prosecuted provided all its elements concur – two of which are a Code, under which the first marriage was celebrated, provides that
previous marriage and a subsequent marriage which would have been "every intendment of law or fact leans toward the validity of marriage,
valid had it not been for the existence at the material time of the first the indissolubility of the marriage bonds."12 [] Hence, parties should
marriage.9 not be permitted to judge for themselves the nullity of their marriage,
for the same must be submitted to the determination of competent
In the case at bar, respondent's clear intent is to obtain a judicial courts. Only when the nullity of the marriage is so declared can it be
declaration of nullity of his first marriage and thereafter to invoke that held as void, and so long as there is no such declaration the
very same judgment to prevent his prosecution for bigamy. He cannot presumption is that the marriage exists. 13 No matter how obvious,
have his cake and eat it too. Otherwise, all that an adventurous manifest or patent the absence of an element is, the intervention of the
bigamist has to do is to disregard Article 40 of the Family Code, courts must always be resorted to. That is why Article 40 of the Family
contract a subsequent marriage and escape a bigamy charge by simply Code requires a "final judgment," which only the courts can render.
claiming that the first marriage is void and that the subsequent Thus, as ruled in Landicho v. Relova,14 he who contracts a second
marriage is equally void for lack of a prior judicial declaration of marriage before the judicial declaration of nullity of the first marriage
nullity of the first. A party may even enter into a marriage aware of assumes the risk of being prosecuted for bigamy, and in such a case
the absence of a requisite - usually the marriage license - and thereafter the criminal case may not be suspended on the ground of the pendency
contract a subsequent marriage without obtaining a declaration of of a civil case for declaration of nullity. In a recent case for
nullity of the first on the assumption that the first marriage is void. concubinage, we held that the pendency of a civil case for declaration
Such scenario would render nugatory the provisions on bigamy. As of nullity of marriage is not a prejudicial question. 15 This ruling applies
succinctly held in Landicho v. Relova:10 here by analogy since both crimes presuppose the subsistence of a
marriage.
(P)arties to a marriage should not be permitted to judge for
themselves its nullity, only competent courts having such Ignorance of the existence of Article 40 of the Family Code cannot
authority. Prior to such declaration of nullity, the validity of even be successfully invoked as an excuse.16 The contracting of a
the first marriage is beyond question. A party who contracts a marriage knowing that the requirements of the law have not been
second marriage then assumes the risk of being prosecuted for complied with or that the marriage is in disregard of a legal
bigamy. impediment is an act penalized by the Revised Penal Code.17 The
legality of a marriage is a matter of law and every person is presumed
Respondent alleges that the first marriage in the case before us was to know the law. As respondent did not obtain the judicial declaration
void for lack of a marriage license. Petitioner, on the other hand, of nullity when he entered into the second marriage, why should he be
argues that her marriage to respondent was exempt from the allowed to belatedly obtain that judicial declaration in order to delay
requirement of a marriage license. More specifically, petitioner claims his criminal prosecution and subsequently defeat it by his own
that prior to their marriage, they had already attained the age of disobedience of the law? If he wants to raise the nullity of the previous
majority and had been living together as husband and wife for at least
marriage, he can do it as a matter of defense when he presents his WHEREFORE, the petition is GRANTED. The order dated
evidence during the trial proper in the criminal case. December 29, 1998 of the Regional Trial Court, Branch 226 of
Quezon City is REVERSED and SET ASIDE and the trial court is
The burden of proof to show the dissolution of the first marriage ordered to IMMEDIATELY proceed with Criminal Case No. Q98-
before the second marriage was contracted rests upon the 75611.
defense,18 but that is a matter that can be raised in the trial of the
bigamy case. In the meantime, it should be stressed that not every SO ORDERED.
defense raised in the civil action may be used as a prejudicial question
to obtain the suspension of the criminal action. The lower court,
therefore, erred in suspending the criminal case for bigamy. Moreover,
when respondent was indicted for bigamy, the fact that he entered into
two marriage ceremonies appeared indubitable. It was only after he
was sued by petitioner for bigamy that he thought of seeking a judicial
declaration of nullity of his first marriage. The obvious intent,
therefore, is that respondent merely resorted to the civil action as a
potential prejudicial question for the purpose of frustrating or delaying
his criminal prosecution. As has been discussed above, this cannot be
done.

In the light of Article 40 of the Family Code, respondent, without first

having obtained the judicial declaration of nullity of the first marriage,
can not be said to have validly entered into the second marriage. Per
current jurisprudence, a marriage though void still needs a judicial
declaration of such fact before any party can marry again; otherwise
the second marriage will also be void. 19 The reason is that, without a
judicial declaration of its nullity, the first marriage is presumed to be
subsisting. In the case at bar, respondent was for all legal intents and
purposes regarded as a married man at the time he contracted his
second marriage with petitioner.20 Against this legal backdrop, any
decision in the civil action for nullity would not erase the fact that
respondent entered into a second marriage during the subsistence of a
first marriage. Thus, a decision in the civil case is not essential to the
determination of the criminal charge. It is, therefore, not a prejudicial
question. As stated above, respondent cannot be permitted to use his
own malfeasance to defeat the criminal action against him. 21
G.R. No. 84516 December 5, 1989 WHEREFORE, finding the accused EDWIN RAMIREZ y WEE
guilty as a principal beyond reasonable doubt of the Amended
DIONISIO CARPIO, petitioner, Information to which he voluntarily pleaded guilty and appreciating
vs. this mitigating circumstance in his favor, hereby sentences him to
HON. SERGIO DOROJA, (Presiding Judge, MTC, Branch IV, suffer the penalty of One (1) month and One (1) day to Two (2) months
Zamboanga City) and EDWIN RAMIREZ Y WEE, respondents. of Arresto Mayor in its minimum period. The accused is likewise
ordered to indemnify the complainant Dionisio A. Carpio the amount
of P45.00 representing the value of the 1/2 can of tomatoes lost; the
amount of P200.00 which complainant paid to the Zamboanga
PARAS, J.: General Hospital, to pay complainant the amount of Pl,500.00 as
attorney's fees and to pay the cost of this suit. SO ORDERED. (p. 7,
Before us is a petition to review by certiorari the decision of the Rollo)
Municipal Trial Court of Zamboanga City, Branch IV, which denied
petitioner's motion for subsidiary writ of execution against the owner- Thereafter, the accused filed an application for probation.
operator of the vehicle which figured in the accident.
At the early stage of the trial, the private prosecutor manifested his
The facts of the case are undisputed. desire to present evidence to establish the civil liability of either the
accused driver or the owner-operator of the vehicle. Accused's counsel
Sometime on October 23, 1985, accused-respondent Edwin Ramirez, moved that the court summon the owner of the vehicle to afford the
while driving a passenger Fuso Jitney owned and operated by Eduardo latter a day in court, on the ground that the accused is not only indigent
but also jobless and thus cannot answer any civil liability that may be
Toribio, bumped Dionisio Carpio, a pedestrian crossing the street, as
a consequence of which the latter suffered from a fractured left imposed upon him by the court. The private prosecutor, however, did
clavicle as reflected in the medico-legal certificate and sustained not move for the appearance of Eduardo Toribio.
injuries which required medical attention for a period of (3) three
months. The civil aspect of the above-quoted decision was appealed by the
private prosecutor to the Regional Trial Court Branch XVI, appellant
An information for Reckless Imprudence Resulting to Serious praying for moral damages in the amount of P 10,000.00,
Physical Injuries was filed against Edwin Ramirez with the Municipal compensatory damages at P6,186.40, and attorney's fees of P
Trial Court of Zamboanga City, Branch IV. On January 14, 1987, the 5,000.00. The appellate court, on January 20, 1988, modified the trial
court's decision, granting the appellant moral damages in the amount
accused voluntarily pleaded guilty to a lesser offense and was
accordingly convicted for Reckless Imprudence Resulting to Less of Five Thousand Pesos (P 5,000.00), while affirming all other civil
Serious Physical Injuries under an amended information punishable liabilities.
under Article 365 of the Revised Penal Code. The dispositive portion
of the decision handed down on May 27, 1987 reads as follows: Thereafter, a writ of execution dated March 10, 1988 was duly served
upon the accused but was, however, returned unsatisfied due to the
insolvency of the accused as shown by the sheriffs return. Thus,
complainant moved for a subsidiary writ of execution against the Thus, the underlying issue raised in this case is; whether or not the
subsidiary liability of the owner-operator of the vehicle. The same was subsidiary liability of the owner-operator may be enforced in the same
denied by the trial court on two grounds, namely, the decision of the criminal proceeding against the driver where the award was given, or
appellate court made no mention of the subsidiary liability of Eduardo in a separate civil action.
Toribio, and the nature of the accident falls under "culpa-aquiliana"
and not culpa-contractual." A motion for reconsideration of the said The law involved in the instant case is Article 103 in relation to Article
order was disallowed for the reason that complainant having failed to 100, both of the Revised Penal Code, which reads thus:
raise the matter of subsidiary liability with the appellate court, said
court rendered its decision which has become final and executory and Art. 103. Subsidiary civil liability of other persons. The subsidiary
the trial court has no power to alter or modify such decision. liability established in the next preceding article shall apply to
employers, teachers, persons, and corporations engaged in any kind of
Hence, the instant petition. industry for felonies committed by their servants, pupils, workmen,
apprentices, or employees in the discharge of their duties.
Petitioner relies heavily on the case of Pajarito v. Seneris, 87 SCRA
275, which enunciates that "the subsidiary liability of the owner- Respondent contends that the case of Pajarito v. Seneris cannot be
operator is fixed by the judgment, because if a case were to be filed applied to the present case, the former being an action involving culpa-
against said operator, the court called upon to act thereto has no other contractual, while the latter being one of culpa-aquiliana. Such a
function than to render a decision based on the indemnity award in the declaration is erroneous. The subsidiary liability in Art. 103 should be
criminal case without power to amend or modify it even if in his distinguished from the primary liability of employers, which is quasi-
opinion an error has been committed in the decision." Petitioner delictual in character as provided in Art. 2180 of the New Civil Code.
maintains that the tenor of the aforesaid decision implies that the Under Art. 103, the liability emanated from a delict. On the other hand,
subsidiary liability of the owner-operator may be enforced in the same the liability under Art. 2180 is founded on culpa-aquiliana. The
proceeding and a separate action is no longer necessary in order to present case is neither an action for culpa-contractual nor for culpa-
avoid undue delay, notwithstanding the fact that said employer was aquiliana. This is basically an action to enforce the civil liability
not made a party in the criminal action. arising from crime under Art. 100 of the Revised Penal Code. In no
case can this be regarded as a civil action for the primary liability of
It is the theory of respondent that the owner-operator cannot be validly the employer under Art. 2180 of the New Civil Code, i.e., action
held subsidiarily liable for the following reasons, namely: (a) the for culpa-aquiliana.
matter of subsidiary liability was not raised on appeal; (b) contrary to
the case of Pajarito v. Seneris, the injuries sustained by the In order that an employer may be held subsidiarily liable for the
complainant did not arise from the so-called "culpa-contractual" but employee's civil liability in the criminal action, it should be shown (1)
from "culpa-aquiliana"; (c) the judgments of appellate courts may not that the employer, etc. is engaged in any kind of industry, (2) that the
be altered, modified, or changed by the court of origin; and (d) said employee committed the offense in the discharge of his duties and (3)
owner was never made a party to the criminal proceedings. that he is insolvent (Basa Marketing Corp. v. Bolinao, 117 SCRA
156). The subsidiary liability of the employer, however, arises only
after conviction of the employee in the criminal action. All these
requisites present, the employer becomes ipso facto subsidiarily liable following pronouncement: "A judgment of conviction sentencing a
upon the employee's conviction and upon proof of the latter's defendant employer to pay an indemnity in the absence of any
insolvency. Needless to say, the case at bar satisfies all these collusion between the defendant and the offended party, is conclusive
requirements. upon the employer in an action for the enforcement of the latter's
subsidiary liability not only with regard to the civil liability, but also
Furthermore, we are not convinced that the owner-operator has been with regard to its amount." This being the case, this Court stated
deprived of his day in court, because the case before us is not one in Rotea v. Halili, 109 Phil. 495, "that the court has no other function
wherein the operator is sued for a primary liability under the Civil than to render decision based upon the indemnity awarded in the
Code but one in which the subsidiary civil liability incident to and criminal case and has no power to amend or modify it even if in its
dependent upon his employee's criminal negligence is sought to be opinion an error has been committed in the decision. A separate and
enforced. Considering the subsidiary liability imposed upon the independent action is, therefore, unnecessary and would only unduly
employer by law, he is in substance and in effect a party to the criminal prolong the agony of the heirs of the victim."
case. Ergo, the employer's subsidiary liability may be determined and
enforced in the criminal case as part of the execution proceedings Finally, the position taken by the respondent appellate court that to
against the employee. This Court held in the earlier case of Pajarito v. grant the motion for subsidiary writ of execution would in effect be to
Seneris, supra, that "The proceeding for the enforcement of the amend its decision which has already become final and executory
subsidiary civil liability may be considered as part of the proceeding cannot be sustained. Compelling the owner-operator to pay on the
for the execution of the judgment. A case in which an execution has basis of his subsidiary liability does not constitute an amendment of
been issued is regarded as still pending so that all proceedings on the the judgment because in an action under Art. 103 of the Revised Penal
execution are proceedings in the suit. There is no question that the Code, once all the requisites as earlier discussed are met, the employer
court which rendered the judgment has a general supervisory control becomes ipso facto subsidiarily liable, without need of a separate
over its process of execution, and this power carries with it the right action. Such being the case, the subsidiary liability can be enforced in
to determine every question of fact and law which may be involved in the same case where the award was given, and this does not constitute
the execution." an act of amending the decision. It becomes incumbent upon the court
to grant a motion for subsidiary writ of execution (but only after the
The argument that the owner-operator cannot be held subsidiarily employer has been heard), upon conviction of the employee and after
liable because the matter of subsidiary liability was not raised on execution is returned unsatisfied due to the employee's insolvency.
appeal and in like manner, the appellate court's decision made no
mention of such subsidiary liability is of no moment. As already WHEREFORE, the order of respondent court disallowing the motion
discussed, the filing of a separate complaint against the operator for for subsidiary writ of execution is hereby SET ASIDE. The Court a
recovery of subsidiary liability is not necessary since his liability is quo is directed to hear and decide in the same proceeding the
clear from the decision against the accused. Such being the case, it is subsidiary liability of the alleged owner-operator of the passenger
not indispensable for the question of subsidiary liability to be passed jitney. Costs against private respondent.
upon by the appellate court. Such subsidiary liability is already
implied from the appellate court's decision. In the recent case of Vda. SO ORDERED.
de Paman v. Seneris, 115 SCRA 709, this Court reiterated the
\
G.R. No. L-18966 November 22, 1966 solidarily responsible for damages, consisting of the civil indemnity
required of the driver Bobis in the judgment of conviction, plus moral
VICENTE BANTOTO, ET AL., plaintiffs-appellees, and exemplary damages and attorneys' fees and costs.
vs.
SALVADOR BOBIS, ET AL., defendants. Vallejo moved to dismiss on the ground of failure to state a cause of
CRISPIN VALLEJO, defendant-appellant. action against him, for the reason that the amended complaint did not
aver that the driver, Bobis, was insolvent. The court overruled the
Arturo M. Glaraga for plaintiffs-appellees. motion to dismiss, and on 20 February 1960 Vallejo answered the
Casiano P. Laquihon for defendant-appellant. complaint, setting up denials and affirmative defenses, specifically
averring that the brothers and sisters of the deceased were not real
REYES, J.B.L., J.: parties in interest; that the complaint stated no cause of action against
Vallejo; that his liability was only subsidiary; that the action was
Crispin Vallejo appeals from a decision rendered in Civil Case No. barred by prior judgment; and that the liability had been satisfied.
5422 of the Court of First Instance of Occidental Negros, sentencing Bobis was declared in default.
him to pay to Vicente Bantoto and Florita Lanceta, parents of the late
Damiana Bantoto, civil indemnity in the sum of P3,000.00, plus At the trial, the court of origin (overruling Vallejo's objections)
P1,000.00 exemplary damages and the further sum of P500.00 admitted as Exhibit "A" for plaintiffs the writ of execution against the
attorneys' fees, without pronouncement as to costs. driver, Salvador Bobis, issued in the criminal case, and as Exhibit "B"
the sheriff's return nulla bona. Vallejo presented no evidence.
The basic facts are not controverted. Appellant Crispin Vallejo was Wherefore, the court absolved defendant Maceda and rendered
the registered owner of a "jeepney" named "Jovil 11", with plate TPU- judgment against Crispin Vallejo in the terms described at the start of
20948, that was operated by him in Bacolod City through driver this opinion.
Salvador Bobis. On 24 October 1948, through the driver's negligence,
the "jeepney" struck a 3-year old girl, Damiana Bantoto, a daughter of Vallejo appealed directly to this Supreme Court, assigning three
appellees, inflicting serious injuries that led to her death a few days errors:
later. The City Fiscal of Bacolod filed an information charging Bobis
with homicide through reckless imprudence, to which Bobis pleaded I — The trial Court erred in not dismissing the complaint for
guilty. He was, accordingly, sentenced to 2 months and 1 day lack of a cause of action.
of arresto mayor and to indemnify the deceased girl's heirs (appellees
herein) in the sum of P3,000.00. II —The trial Court erred in admitting as evidence Exhibits
"A" and "B" of the appellees.
By amended complaint of 8 October 1959, appellees Vicente Bantoto
and Florita Lanceta, for themselves and their other children, instituted III — The trial Court erred in condemning the defendant-
the present action against Salvador Bobis, Juan Maceda (later appellant to pay to the appellees the sum of P3,000.00 as
absolved) and Crispin Vallejo in the court of first instance, pleading indemnity, P1,000.00 as moral damages, P1,000.00 as
the foregoing facts and seeking to have the three defendants declared exemplary damages, and P500.00 as attorney's fee.
The first alleged error, predicated upon the lack of allegation in the employee commits a punishable criminal act while in the
complaint that driver Bobis was insolvent, is without merit. The actual performance of his ordinary duties and service, and he
master's liability, under the Revised Penal Code, for the crimes is insolvent thereby rendering him incapable of satisfying by
committed by his servants and employees in the discharge of their himself his own civil liability.
duties, is not predicated upon the insolvency of the latter. Article 103
of the Penal Code prescribes that: The underlined passage is, however, mere obiter because the part
immediately preceding the quotation shows that the ratio decidendi of
ART. 103. Subsidiary civil liability of other persons. — The the case was that the accident involved, unlike in the case at bar, did
subsidiary liability established in the next preceding article not occur in the performance of the driver's assigned duties.
shall also apply to employees, teachers, persons, and
corporations engaged in any kind of industry for felonies It should be noted that in said stipulation, there is a provision
committed by their servants, pupils, workmen, apprentices, or appearing in paragraph 3 thereof, which reads as follows:
employees in the discharge of their duties.
"That the defendant Bernardo Castillo was not riding in the
The insolvency of the servant or employee is nowhere mentioned in car at the time of the accident, and he did not know that his
said article as a condition precedent. In truth, such insolvency is car was taken by the chauffeur Mariano Capulong."
required only when the liability of the master is being made effective
by execution levy, but not for the rendition of judgment against the This fact decides the question because it clearly shows that the
master. The subsidiary character of the employer's responsibility accident did not occur in the course of the performance of the
merely imports that the latter's property is not be seized without first duties or service for which said chauffeur Mariano Capulong
exhausting that of the servant. And by analogy to a regular guarantor had been hired. The defendant did not hire him to do as he
(who is the prototype of persons subsidiarily responsible), the master pleased, using the defendant's car as if it were his own. His
may not demand prior exhaustion of the servant's (principal obligor's) duties and service were confined to driving his master's car as
properties if he can not "point out to the creditor available property of the latter ordered him, and the accident did not take place
the debtor within Philippine territory, sufficient to cover the amount under said circumstances.
of the debt" (Cf. Civil Code, Article 1060). This rule is logical, for as
between the offended party (as creditor) and the culprit's master or As to the second error assigned, the same is non-prejudicial, if at all
employer, it is the latter who is in a better position to determine the committed. Supposing, in gratia argumenti, that Exhibits "A" and
resources and solvency of the servant or employee. "B", the execution and the sheriff's return, in the criminal case were
not admissible at the trial of the case against the master, they would
Appellant invokes the following passage in our decision in Marquez certainly be material and admissible when issuance of a writ of
vs. Castillo, 68 Phil. 571: execution of the appealed judgment is demanded. It is well to move
here that this Court has ruled that in the absence of collusion the
The subsidiary liability of the master, according to the judgment convicting and sentencing the servant to pay indemnity is
provisions of Article 103 of the Revised Penal Code, arises conclusive in an action to enforce the subsidiary liability of the master
and takes place only when the servant, subordinate, or or employer (Martinez vs. Barredo, 81 Phil. 1). Anyway, since Bobis,
the driver, was also a defendant, the writ of execution issued in the
criminal case to enforce the civil indemnity, and its return without
satisfaction, are not irrelevant evidence in the action against him and
his employer.

Anent the third error, we agree with appellant, that, as the case was
predicated upon the sentence of conviction in the criminal case, the
award of exemplary damages was improper. No such damages were
imposed on the driver, and the master, as person subsidiarily liable,
can not incur greater civil liability than his convicted employee, any
more than a guarantor can be held responsible for more than the
principal debtor (Cf. Civil Code, Article 2064).

But we do not agree that the award of attorney's fees should be

disallowed. Appellant had reason to know that his driver could not pay
the P3,000.00 indemnity imposed in the criminal case, because if he
could, or if he had money or leviable property worth that much, Bobis
would be operating his own jeepney instead of another's. In fact,
Article 2208, paragraph 9, authorizes the award of counsel's fees "in a
separate civil action to recover the civil liability arising from a crime."

As in awarding only P500.00 attorney's fees the court below could

envisage only the services of counsel up to the date of its judgment,
and it could not know then that the decision would be appealed, we
are of the opinion that counsel fees should now be at least doubled.

For the foregoing reasons, the decision under appeal is modified by

eliminating the award of P1,000.00 exemplary damages and doubling
the award for counsel fees, with the result that appellant shall pay the
indemnity of P3,000.00, with interest at 6% from the filing of the
complaint, plus P1,000.00 attorney's fees. In all other respects, said
decision is affirmed. No costs.
G.R. No. 112346 March 29, 1996 When arraigned, the accused pleaded "guilty" and, on 09 March 1992,
the trial court pronounced its judgment —
EVELYN YONAHA, petitioner,
vs. Finding therefore the accused guilty beyond
HON. COURT OF APPEALS and HEIRS OF HECTOR reasonable doubt of the offense charged against him
CAÑETE, respondents. and taking into account the mitigating circumstances
of voluntary surrender and plea of guilty which the
prosecuting fiscal readily accepted, the Court hereby
sentences the accused to suffer and undergo an
VITUG, J.:p imprisonment of 1 year and 1 day to 1 year and 8
months and to pay the heirs of the victim the sum of
From the decision of the Court of Appeals dismissing for lack of merit P50,000.00 for the death of the victim; P30,000.00 for
the petition for certiorari, with prayer for preliminary injunction, filed actual damages incurred in connection with the burial
by Evelyn Yonaha against an order, dated 29 May 1992, of the and the nightly prayer of the deceased victim and
Regional Trial Court1 which had granted private respondent motion P10,000.00 as attorney's fees.3
for the issuance of a writ of subsidiary execution, the instant appeal
was taken. On 27 April 1992, a writ of execution was issued for the satisfaction
of the monetary award. In his Return of Service, dated 07 May 1992,
In Criminal Case No. 01106-L, Elmer Ouano was charged with the the MTCC Deputy City Sheriff stated that he had served the writ on
crime of "Reckless Imprudence Resulting in Homicide" in an accused Elmer Ouano but that the latter had manifested his inability
information which averred — to pay the money obligation.

That on April 14, 1990, at or about 11:45 A.M. in Forthwith, private respondents presented a "motion for subsidiary
Basak, Lapulapu City, Philippines, within the execution" with neither a notice of hearing nor notice to petitioner.
jurisdiction of this Honorable Court, the aforenamed Acting on the motion, nevertheless, the trial court issued an order,
accused, while driving a Toyota Tamaraw sporting dated 29 May 1992, directing the issuance of a writ of subsidiary
Plate No. GCX-237 duly registered in the name of execution. The sheriff went to petitioner's residence to enforce the
Raul Cabahug and owned by EK SEA Products, did writ, and it was then, allegedly for the first time, that petitioner was
then and there unlawfully and feloniously maneuver informed of Ouano's conviction. Petitioner filed a motion to stay and
and operate it in a negligent and reckless manner, to recall the subsidiary writ of execution principally anchored on the
without taking the necessary precaution to avoid lack of prior notice to her and on the fact that the employer's liability
injuries to person and damage to property, as a result had yet to be established. Private respondents opposed the motion.
thereof the motor vehicle he was then driving bumped
and hit Hector Cañete, which caused the latter's On 24 August 1992, the trial court denied petitioner's motion. On 23
instantaneous death, due to the multiple severe September 1992, petitioner's plea for reconsideration of the denial was
traumatic injuries at different parts of his body. 2 likewise rejected.
Petitioner promptly elevated the matter to the Court of Appeals (CA- subsidiary liability, as employer of the convicted
GR SP No. 29116) for review. The appellate court initially restrained Elmer Ouano.4
the implementation of the assailed orders and issued a writ of
preliminary injunction upon the filing of a P10,000.00 bond. In the instant appeal, petitioner additionally reminds the Court that
Ultimately, however, the appellate court, in its decision of 28 Ouano's conviction was not the result of a finding of proof beyond
September 1993, dismissed the petition for lack of merit and thereby reasonable doubt but from his spontaneous plea of guilt.
lifted the writ of preliminary injunction. The Court of Appeals
ratiocinated: We find merit in the petition.

We are not unmindful of the ruling in the aforecited The statutory basis for an employer's subsidiary liability is found in
case of Lucia Pajarito vs. Señeris, supra. — that Article 103 of the Revised Penal Code.5 This Court has since
enforcement of the secondary or subsidiary liability sanctioned the enforcement of this subsidiary liability in the same
of employer maybe done by motion in the same criminal proceedings in which the employee is adjudged guilty, 6 on
criminal case, a recourse which presupposes a the thesis that it really is a part of, and merely an incident in, the
hearing. But even assuming that issuance of writ of execution process of the judgment. But, execution against the
subsidiary execution requires notice and hearing, we employer must not issue as just a matter of course, and it behooves the
believe a hearing in the present case would be sheer court, as a measure of due process to the employer, to determine and
rigmarole, an unnecessary formality, because, as resolve a priori, in a hearing set for the purpose, the legal applicability
employer, petitioner became subsidiarily liable upon and propriety of the employer's liability. The requirement is
the conviction of her accused driver, Elmer Ouano, mandatory even when it appears prima facie that execution against the
and proof of the latter's insolvency. And if she had convicted employee cannot be satisfied. The court must convince itself
any defense to free herself from such subsidiary that the convicted employee is in truth in the employ of the employer;
liability, she could have ventilated and substantiated that the latter is engaged in an industry of some kind; that the
the same in connection with her (petitioner's) motion employee has committed the crime to which civil liability attaches
to stay and recall the writ of subsidiary execution in while in the performance of his duties as such; and that execution
question. But from her said motion, it can be gleaned against the employee is unsuccessful by reason of insolvency.7
that except for the protestation of violation of due
process, and absence of notice to her of the motion for The assumption that, since petitioner in this case did not aver any
issuance of a writ of subsidiary execution, petitioner exculpatory facts in her "motion to stay and recall," as well as in her
intimated no defense which could absolve her of motion for reconsideration, which could save her from liability; a
subsidiary liability under the premises. Then, too, hearing would be a futile and a sheer rigmarole is unacceptable. The
after the denial of her motion to stay and recall subject employer must be given his full day in court.
writ, petitioner moved for reconsideration but in her
motion for reconsideration, she averred no To repeat, the subsidiary liability of an employer under Article 103 of
exculpatory facts which could save her from the Revised Penal Code requires (a) the existence of an employer-
employee relationship; (b) that the employer is engaged in some kind
of industry; (c) that the employee is adjudged guilty of the wrongful
act and found to have committed the offense in the discharge of his
duties (not necessarily any offense he commits "while" in the
discharge of such duties); and (d) that said employee is insolvent. The
judgment of conviction of the employee, of course, concludes the
employer 8 and the subsidiary liability may be enforced in the same
criminal case, but to afford the employer due process, the court should
hear and decide that liability on the basis of the conditions required
therefor by law.9

WHEREFORE, finding the order, dated 29 May 1992, as well as the

order of 24 August 1992 to have been improvidently issued, said
orders are hereby SET ASIDE. Petitioner shall be given the right to a
hearing on the motion for the issuance of a writ of subsidiary execution
filed by private respondents, and the case is REMANDED to the trial
court for further proceedings conformably with our foregoing opinion.
No costs.
G.R. No. 111127 July 26, 1996 after trying him out for two weeks, His job was to take school children
to and from the St. Scholastica's College in Malate, Manila.
MR. & MRS. ENGRACIO FABRE, JR. and PORFIRIO
CABIL, petitioners, On November 2, 1984 private respondent Word for the World
vs. Christian Fellowship Inc. (WWCF) arranged with petitioners for the
COURT OF APPEALS, THE WORD FOR THE WORLD transportation of 33 members of its Young Adults Ministry from
CHRISTIAN FELLOWSHIP, INC., AMYLINE ANTONIO, Manila to La Union and back in consideration of which private
JOHN RICHARDS, GONZALO GONZALES, VICENTE V. respondent paid petitioners the amount of P3,000.00.
QUE, JR., ICLI CORDOVA, ARLENE GOJOCCO, ALBERTO
ROXAS CORDERO, RICHARD BAUTISTA, JOCELYN The group was scheduled to leave on November 2, 1984, at 5:00
GARCIA, YOLANDA CORDOVA, NOEL ROQUE, EDWARD o'clock in the afternoon. However, as several members of the party
TAN, ERNESTO NARCISO, ENRIQUETA LOCSIN, FRANCIS were late, the bus did not leave the Tropical Hut at the corner of
NORMAN O. LOPES, JULIUS CAESAR, GARCIA, ROSARIO Ortigas Avenue and EDSA until 8:00 o'clock in the evening. Petitioner
MA. V. ORTIZ, MARIETTA C. CLAVO, ELVIE SENIEL, Porfirio Cabil drove the minibus.
ROSARIO MARA-MARA, TERESITA REGALA, MELINDA
TORRES, MARELLA MIJARES, JOSEFA CABATINGAN, The usual route to Caba, La Union was through Carmen, Pangasinan.
MARA NADOC, DIANE MAYO, TESS PLATA, MAYETTE However, the bridge at Carmen was under repair, sot hat petitioner
JOCSON, ARLENE Y. MORTIZ, LIZA MAYO, CARLOS Cabil, who was unfamiliar with the area (it being his first trip to La
RANARIO, ROSAMARIA T. RADOC and BERNADETTE Union), was forced to take a detour through the town of Baay in
FERRER, respondents. Lingayen, Pangasinan. At 11:30 that night, petitioner Cabil came upon
a sharp curve on the highway, running on a south to east direction,
which he described as "siete." The road was slippery because it was
raining, causing the bus, which was running at the speed of 50
MENDOZA, J.:p kilometers per hour, to skid to the left road shoulder. The bus hit the
left traffic steel brace and sign along the road and rammed the fence
This is a petition for review on certiorari of the decision of the Court of one Jesus Escano, then turned over and landed on its left side,
of Appeals1 in CA-GR No. 28245, dated September 30, 1992, which coming to a full stop only after a series of impacts. The bus came to
affirmed with modification the decision of the Regional Trial Court of rest off the road. A coconut tree which it had hit fell on it and smashed
Makati, Branch 58, ordering petitioners jointly and severally to pay its front portion.
damages to private respondent Amyline Antonio, and its resolution
which denied petitioners' motion for reconsideration for lack of merit. Several passengers were injured. Private respondent Amyline Antonio
was thrown on the floor of the bus and pinned down by a wooden seat
Petitioners Engracio Fabre, Jr. and his wife were owners of a 1982 which came down by a wooden seat which came off after being
model Mazda minibus. They used the bus principally in connection unscrewed. It took three persons to safely remove her from this
with a bus service for school children which they operated in Manila. portion. She was in great pain and could not move.
The couple had a driver, Porfirio J. Cabil, whom they hired in 1981,
The driver, petitioner Cabil, claimed he did not see the curve until it defendants which ultimately resulted to the accident subject of this
was too late. He said he was not familiar with the area and he could case.
not have seen the curve despite the care he took in driving the bus,
because it was dark and there was no sign on the road. He said that he Accordingly, it gave judgment for private respondents holding:
saw the curve when he was already within 15 to 30 meters of it. He
allegedly slowed down to 30 kilometers per hour, but it was too late. Considering that plaintiffs Word for the World Christian Fellowship,
Inc. and Ms. Amyline Antonio were the only ones who adduced
The Lingayen police investigated the incident the next day, November evidence in support of their claim for damages, the Court is therefore
3, 1984. On the basis of their finding they filed a criminal complaint not in a position to award damages to the other plaintiffs.
against the driver, Porfirio Cabil. The case was later filed with the
Lingayen Regional Trial Court. Petitioners Fabre paid Jesus Escano WHEREFORE, premises considered, the Court hereby renders
P1,500.00 for the damage to the latter's fence. On the basis of Escano's judgment against defendants Mr. & Mrs. Engracio Fabre, Jr. and
affidavit of desistance the case against petitioners Fabre was Porfirio Cabil y Jamil pursuant to articles 2176 and 2180 of the Civil
dismissed. Code of the Philippines and said defendants are ordered to pay jointly
and severally to the plaintiffs the following amount:
Amyline Antonio, who was seriously injured, brought this case in the
RTC of Makati, Metro Manila. As a result of the accident, she is now 1) P93,657.11 as compensatory and actual damages;
suffering from paraplegia and is permanently paralyzed from the waist
down. During the trial she described the operations she underwent and 2) P500,000.00 as the reasonable amount of loss of
adduced evidence regarding the cost of her treatment and therapy. earning capacity of plaintiff Amyline Antonio;
Immediately after the accident, she was taken to the Nazareth Hospital
in Baay, Lingayen. As this hospital was not adequately equipped, she
3) P20,000.00 as moral damages;
was transferred to the Sto. Niño Hospital, also in the town of Ba-ay,
where she was given sedatives. An x-ray was taken and the damage to
4) P20,000.00 as exemplary damages; and
her spine was determined to be too severe to be treated there. She was
therefore brought to Manila, first to the Philippine General Hospital
and later to the Makati Medical Center where she underwent an 5) 25% of the recoverable amount as attorney's fees;
operation to correct the dislocation of her spine.
6) Costs of suit.
In its decision dated April 17, 1989, the trial court found that:
SO ORDERED.
No convincing evidence was shown that the minibus was properly
checked for travel to a long distance trip and that the driver was The Court of Appeals affirmed the decision of the trial court with
properly screened and tested before being admitted for employment. respect to Amyline Antonio but dismissed it with respect to the other
Indeed, all the evidence presented have shown the negligent act of the plaintiffs on the ground that they failed to prove their respective
claims. The Court of Appeals modified the award of damages as Petitioners challenge the propriety of the award of compensatory
follows: damages in the amount of P600,000.00. It is insisted that, on the
assumption that petitioners are liable an award of P600,000.00 is
1) P93,657.11 as actual damages; unconscionable and highly speculative. Amyline Antonio testified that
she was a casual employee of a company called "Suaco," earning
2) P600,000.00 as compensatory damages; P1,650.00 a month, and a dealer of Avon products, earning an average
of P1,000.00 monthly. Petitioners contend that as casual employees
3) P50,000.00 as moral damages; do not have security of tenure, the award of P600,000.00, considering
Amyline Antonio's earnings, is without factual basis as there is no
4) P20,000.00 as exemplary damages; assurance that she would be regularly earning these amounts.

With the exception of the award of damages, the petition is devoid of

5) P10,000.00 as attorney's fees; and
merit.
6) Costs of suit.
First, it is unnecessary for our purpose to determine whether to decide
this case on the theory that petitioners are liable for breach of contract
The Court of Appeals sustained the trial court's finding that petitioner
of carriage or culpa contractual or on the theory of quasi
Cabil failed to exercise due care and precaution in the operation of his
delict or culpa aquiliana as both the Regional Trial Court and the
vehicle considering the time and the place of the accident. The Court
Court of Appeals held, for although the relation of passenger and
of Appeals held that the Fabres were themselves presumptively
carrier is "contractual both in origin and nature," nevertheless "the act
negligent. Hence, this petition. Petitioners raise the following issues: that breaks the contract may be also a tort." 2 In either case, the
question is whether the bus driver, petitioner Porfirio Cabil, was
I. WHETHER OR NOT negligent.
PETITIONERS WERE
NEGLIGENT.
The finding that Cabil drove his bus negligently, while his employer,
the Fabres, who owned the bus, failed to exercise the diligence of a
II. WHETHER OF NOT good father of the family in the selection and supervision of their
PETITIONERS WERE LIABLE employee is fully supported by the evidence on record. These factual
FOR THE INJURIES SUFFERED findings of the two courts we regard as final and conclusive, supported
BY PRIVATE RESPONDENTS. as they are by the evidence. Indeed, it was admitted by Cabil that on
the night in question, it was raining, and as a consequence, the road
III WHETHER OR NOT was slippery, and it was dark. He averred these facts to justify his
DAMAGES CAN BE AWARDED failure to see that there lay a sharp curve ahead. However, it is
AND IN THE POSITIVE, UP TO undisputed that Cabil drove his bus at the speed of 50 kilometers per
WHAT EXTENT. hour and only slowed down when he noticed the curve some 15 to 30
meters ahead. 3 By then it was too late for him to avoid falling off the
road. Given the conditions of the road and considering that the trip a long distance travel, especially considering that the trip to La Union
was Cabil's first one outside of Manila, Cabil should have driven his was his first. The existence of hiring procedures and supervisory
vehicle at a moderate speed. There is testimony 4 that the vehicles policies cannot be casually invoked to overturn the presumption of
passing on that portion of the road should only be running 20 negligence on the part of an employer. 8
kilometers per hour, so that at 50 kilometers per hour, Cabil was
running at a very high speed. Petitioners argue that they are not liable because (1) an earlier
departure (made impossible by the congregation's delayed meeting)
Considering the foregoing — the fact that it was raining and the road could have a averted the mishap and (2) under the contract, the WWCF
was slippery, that it was dark, that he drove his bus at 50 kilometers was directly responsible for the conduct of the trip. Neither of these
an hour when even on a good day the normal speed was only 20 contentions hold water. The hour of departure had not been fixed.
kilometers an hour, and that he was unfamiliar with the terrain, Cabil Even if it had been, the delay did not bear directly on the cause of the
was grossly negligent and should be held liable for the injuries accident. With respect to the second contention, it was held in an early
suffered by private respondent Amyline Antonio. case that:

Pursuant to Arts. 2176 and 2180 of the Civil Code his negligence gave [A] person who hires a public automobile and gives the driver
rise to the presumption that his employers, the Fabres, were directions as to the place to which he wishes to be conveyed, but
themselves negligent in the selection and supervisions of their exercises no other control over the conduct of the driver, is not
employee. responsible for acts of negligence of the latter or prevented from
recovering for injuries suffered from a collision between the
Due diligence in selection of employees is not satisfied by finding that automobile and a train, caused by the negligence or the automobile
the applicant possessed a professional driver's license. The employer driver. 9
should also examine the applicant for his qualifications, experience
and record of service. 5 Due diligence in supervision, on the other As already stated, this case actually involves a contract of carriage.
hand, requires the formulation of rules and regulations for the Petitioners, the Fabres, did not have to be engaged in the business of
guidance of employees and issuance of proper instructions as well as public transportation for the provisions of the Civil Code on common
actual implementation and monitoring of consistent compliance with carriers to apply to them. As this Court has held: 10
the rules.6
Art. 1732. Common carriers are persons,
In the case at bar, the Fabres, in allowing Cabil to drive the bus to La corporations, firms or associations engaged in the
Union, apparently did not consider the fact that Cabil had been driving business of carrying or transporting passengers or
for school children only, from their homes to the St. Scholastica's goods or both, by land, water, or air for compensation,
College in Metro Manila. 7 They had hired him only after a two-week offering their services to the public.
apprenticeship. They had hired him only after a two-week
apprenticeship. They had tested him for certain matters, such as The above article makes no distinction between one
whether he could remember the names of the children he would be whose principal business activity is the carrying of
taking to school, which were irrelevant to his qualification to drive on persons or goods or both, and one who does such
 carrying only as an ancillary activity (in local idiom, of breach of contract of carriage under Arts. 1733, 1755 and 1759 of
as "a sideline"). Article 1732 also carefully avoids the Civil Code.
making any distinction between a person or enterprise
offering transportation service on a regular or Secondly, we sustain the award of damages in favor of Amyline
scheduled basis and one offering such service on an Antonio. However, we think the Court of Appeals erred in increasing
occasional, episodic or unscheduled basis. Neither the amount of compensatory damages because private respondents did
does Article 1732 distinguish between a carrier not question this award as inadequate. 11 To the contrary, the award of
offering its services to the "general public," i.e., the P500,000.00 for compensatory damages which the Regional Trial
general community or population, and one who offers Court made is reasonable considering the contingent nature of her
services or solicits business only from a narrow income as a casual employee of a company and as distributor of beauty
segment of the general population. We think that products and the fact that the possibility that she might be able to work
Article 1732 deliberately refrained from making such again has not been foreclosed. In fact she testified that one of her
distinctions. previous employers had expressed willingness to employ her again.

As common carriers, the Fabres were found to With respect to the other awards, while the decisions of the trial court
exercise "extraordinary diligence" for the safe and the Court of Appeals do not sufficiently indicate the factual and
transportation of the passengers to their destination. legal basis for them, we find that they are nevertheless supported by
This duty of care is not excused by proof that they evidence in the records of this case. Viewed as an action for quasi
exercise the diligence of a good father of the family delict, this case falls squarely within the purview of Art. 2219(2)
in the selection and supervision of their employee. As providing for the payment of moral damages in cases of quasi delict.
Art. 1759 of the Code provides: On the theory that petitioners are liable for breach of contract of
carriage, the award of moral damages is authorized by Art. 1764, in
Common carriers are liable for the death of or injuries relation to Art. 2220, since Cabil's gross negligence amounted to bad
to passengers through the negligence or willful acts of faith.12 Amyline Antonio's testimony, as well as the testimonies of her
the former's employees although such employees may father and copassengers, fully establish the physical suffering and
have acted beyond the scope of their authority or in mental anguish she endured as a result of the injuries caused by
violation of the orders of the common carriers. petitioners' negligence.

This liability of the common carriers does not cease The award of exemplary damages and attorney's fees was also
upon proof that they exercised all the diligence of a properly made. However, for the same reason that it was error for the
good father of a family in the selection and appellate court to increase the award of compensatory damages, we
supervision of their employees. hold that it was also error for it to increase the award of moral damages
and reduce the award of attorney's fees, inasmuch as private
The same circumstances detailed above, supporting the finding of the respondents, in whose favor the awards were made, have not
trial court and of the appellate court that petitioners are liable under appealed. 13
Arts. 2176 and 2180 for quasi delict, fully justify findings them guilty
As above stated, the decision of the Court of Appeals can be sustained and severally liable for damages. Some members of
either on the theory of quasi delict or on that of breach of contract. the Court, though, are of the view that under the
The question is whether, as the two courts below held, petitioners, who circumstances they are liable on quasi-delict. 20
are the owners and driver of the bus, may be made to respond jointly
and severally to private respondent. We hold that they may be. It is true that in Philippine Rabbit Bus Lines, Inc. v. Court of
In Dangwa Trans. Co. Inc. v. Court of Appeals, 14 on facts similar to Appeals 21 this Court exonerated the jeepney driver from liability to
those in this case, this Court held the bus company and the driver the injured passengers and their families while holding the owners of
jointly and severally liable for damages for injuries suffered by a the jeepney jointly and severally liable, but that is because that case
passenger. Again, in Bachelor Express, Inc. v. Court of was expressly tried and decided exclusively on the theory of culpa
Appeals 15 a driver found negligent in failing to stop the bus in order contractual. As this Court there explained:
to let off passengers when a fellow passenger ran amuck, as a result of
which the passengers jumped out of the speeding bus and suffered The trial court was therefore right in finding that Manalo (the driver)
injuries, was held also jointly and severally liable with the bus and spouses Mangune and Carreon (the jeepney owners) were
company to the injured passengers. negligent. However, its ruling that spouses Mangune and Carreon are
jointly and severally liable with Manalo is erroneous. The driver
The same rule of liability was applied in situations where the cannot be held jointly and severally liable with carrier in case of
negligence of the driver of the bus on which plaintiff was riding breach of the contract of carriage. The rationale behind this is readily
concurred with the negligence of a third party who was the driver of discernible. Firstly, the contract of carriage is between the carrier is
another vehicle, thus causing an accident. In Anuran exclusively responsible therefore to the passenger, even if such breach
v. Buño, 16 Batangas Laguna Tayabas Bus Co. v. Intermediate be due to the negligence of his driver (see Viluan v. The Court of
Appellate Court, 17 and Metro Manila Transit Corporation v. Court Appeals, et al., G.R. Nos. L-21477-81, April 29, 1966, 16 SCRA
of Appeals, 18 the bus company, its driver, the operator of the other 742). 22
vehicle and the driver of the vehicle were jointly and severally held
liable to the injured passenger or the latters' heirs. The basis of this As in the case of BLTB, private respondents in this case and her
allocation of liability was explained in Viluan v. Court of coplaintiffs did not stake out their claim against the carrier and the
Appeals, 19 thus: driver exclusively on one theory, much less on that of breach of
contract alone. After all, it was permitted for them to allege alternative
Nor should it make any difference that the liability of causes of action and join as many parties as may be liable on such
petitioner [bus owner] springs from contract while causes of action 23 so long as private respondent and her coplaintiffs
that of respondents [owner and driver of other do not recover twice for the same injury. What is clear from the cases
vehicle] arises from quasi-delict. As early as 1913, we is the intent of the plaintiff there to recover from both the carrier and
already ruled in Gutierrez vs. Gutierrez, 56 Phil. 177, the driver, thus, justifying the holding that the carrier and the driver
that in case of injury to a passenger due to the were jointly and severally liable because their separate and distinct
negligence of the driver of the bus on which he was acts concurred to produce the same injury.
riding and of the driver of another vehicle, the drivers
as well as the owners of the two vehicles are jointly
WHEREFORE, the decision of the Court of Appeals is AFFIRMED
with MODIFICATION as to award of damages. Petitioners are
ORDERED to PAY jointly and severally the private respondent
Amyline Antonio the following amounts:

1) P93,657.11 as actual damages;

2) P500,000.00 as the reasonable amount of loss of earning capacity

of plaintiff Amyline Antonio;

3) P20,000.00 as moral damages;

4) P20,000.00 as exemplary damages;

5) 25% of the recoverable amount as attorney's fees; and

6) costs of suit.

SO ORDERED.
G.R. No. 171365 October 6, 2010 After trial, the Metropolitan Trial Court (MeTC) decided in favor of
[petitioners] by ordering [respondent] to (a) vacate the premises at No.
ERMELINDA C. MANALOTO, AURORA J. CIFRA, 42 Big Horseshoe Drive, Horseshoe Village, Quezon City; (b) pay
FLORDELIZA J. ARCILLA, LOURDES J. CATALAN, [petitioners] the sum of ₱306,000.00 corresponding to the rentals due
ETHELINDA J. HOLT, BIENVENIDO R. JONGCO, from May 23, 1997 to November 22, 1998, and the sum of ₱17,000.00
ARTEMIO R. JONGCO, JR. and JOEL JONGCO, Petitioners, a month thereafter until [respondent] vacates the premises; and (c) pay
vs. [petitioners] the sum of ₱5,000.00 as attorney's fees.
ISMAEL VELOSO III, Respondent.
On appeal to the Regional Trial Court (RTC) [Branch 88, Quezon
DECISION City], the MeTC decision was reversed. [Respondent] was ordered to
pay arrearages from May 23, 1997 up to the date of the decision but
LEONARDO-DE CASTRO, J.: he was also given an option to choose between staying in the leased
property or vacating the same, subject to the reimbursement by
Before Us is a Petition for Review on Certiorari of the Decision1 dated [petitioners] of one-half of the value of the improvements which it
January 31, 2006 of the Court Appeals in CA-G.R. CV No. 82610, found to be in the amount of ₱120,000.00. [Respondent] was also
which affirmed with modification the Resolution2 dated September 2, given the right to remove said improvements pursuant to Article 1678
2003 of Branch 227 of the Regional Trial Court (RTC-Branch 227) of of the Civil Code, should [petitioners] refuse to pay ₱60,000.00.
Quezon City in Civil Case No. Q-02-48341.
When both parties moved for the reconsideration of the RTC decision,
We partly reproduce below the facts of the case as culled by the Court the RTC issued an Order dated February 23, 2001 modifying its
of Appeals from the records: previous ruling by increasing the value of the improvements from
₱120,000.00 to ₱800,000.00.
This case is an off-shoot of an unlawful detainer case filed by [herein
petitioners] Ermelinda C. Manaloto, Aurora J. Cifra, Flordeliza J. After successive appeals to the Court of Appeals and the Supreme
Arcilla, Lourdes J. Catalan, Ethelinda J. Holt, Bienvenido R. Jongco, Court, the decision of the RTC dated November 29, 2000 which
Artemio R. Jongco, Jr. and Joel Jongco against [herein respondent]. In reversed the decision of the MeTC, became final and executory. 3
said complaint for unlawful detainer, it was alleged that they are the
lessors of a residential house located at No. 42 Big Horseshoe Drive, Whilst respondent's appeal of the Metropolitan Trial Court (MeTC)
Horseshoe Village, Quezon City [subject property] which was leased judgment in the unlawful detainer case was pending before the RTC-
to [respondent] at a monthly rental of ₱17,000.00. The action was Branch 88, respondent filed before the RTC-Branch 227 on November
instituted on the ground of [respondent's] failure to pay rentals from 26, 2002 a Complaint for Breach of Contract and Damages 4 against
May 23, 1997 to December 22, 1998 despite repeated demands. the petitioners, docketed as Civil Case No. Q-02-48341. The said
[Respondent] denied the non-payment of rentals and alleged that he complaint alleged two causes of action. The first cause of action was
made an advance payment of ₱825,000.00 when he paid for the repairs for damages because the respondent supposedly suffered
done on the leased property. embarrassment and humiliation when petitioners distributed copies of
the above-mentioned MeTC decision in the unlawful detainer case to
the homeowners of Horseshoe Village while respondent's appeal was g) Cost of suit.
still pending before the Quezon City RTC-Branch 88. The second
cause of action was for breach of contract since petitioners, as lessors, [Respondent] further prays for such other reliefs and remedies which
failed to make continuing repairs on the subject property to preserve are just and equitable under the premises.5
and keep it tenantable. Thus, respondent sought the following from the
court a quo: The petitioners filed an Omnibus Motion6 on February 18, 2003
praying for, among other reliefs, the dismissal of respondent's
PRAYER complaint in Civil Case No. Q-02-48341. Petitioners argued that
respondent had no cause of action against them because the MeTC
WHEREFORE, premises considered, it is respectfully prayed that decision in the unlawful detainer case was a matter of public record
after hearing the court render a decision against the [herein petitioners] and its disclosure to the public violated no law or any legal right of the
and in favor of the [herein respondent] by - respondent. Moreover, petitioners averred that the respondent's
present Complaint for Breach of Contract and Damages was barred by
1. Ordering [petitioners] to pay [respondent] the following amounts: prior judgment since it was a mere replication of respondent's Answer
with Compulsory Counterclaim in the unlawful detainer case before
a) ₱1,500,000.00 as moral damages and consequential the MeTC. The said unlawful detainer case was already judicially
damages; decided with finality.

b) ₱500,000.00 as exemplary damages; On September 2, 2003, the RTC-Branch 227 issued a Resolution
dismissing respondent's complaint in Civil Case No. Q-02-48341 for
c) ₱425,000.00 representing the difference of the expenses of violating the rule against splitting of cause of action, lack of
the improvements of ₱825,000.00 and ₱400,000.00 pursuant jurisdiction, and failure to disclose the pendency of a related case. The
to Art. 1678 of the Civil Code; RTC-Branch 227 adjudged that Civil Case No. Q-02-48341 involved
the same facts, parties, and causes of action as those in the unlawful
d) ₱594,000.00 representing interest for three (3) years from detainer case, and the MeTC had already properly taken cognizance
1998 to 2000 on the ₱825,000.00 advanced by the of the latter case.
[respondent] at the rate of 24% per annum;
Respondent received a copy of the RTC-Branch 227 decision in Civil
e) ₱250,000.00 as compensation for the [respondent's] labor Case No. Q-02-48341 on September 26, 2003. He filed a Motion for
and efforts in overseeing and attending the needs of Reconsideration7 of said judgment on October 10, 2003, which RTC-
contractors the repair/renovation of the leased premises; Branch 227 denied in an Order8 dated December 30, 2003.

f) ₱250,000.00, plus 20% of all recoveries from [petitioners] Respondent received a copy of the RTC-Branch 227 order denying his
Motion for Reconsideration on February 20, 2004, and he filed his
and ₱2,500.00 per hearing as attorney's fees;
Notice of Appeal9 on March 1, 2004. However, the RTC-Branch 227,
in an Order10 dated March 23, 2004, dismissed respondent's appeal for unmindful of the fact that court decisions are public documents and
being filed out of time. the general public is allowed access thereto to make inquiries thereon
or to secure a copy thereof. Nevertheless, under the circumstances of
Respondent received a copy of the RTC-Branch 27 order dismissing this case, although court decisions are public documents, distribution
his appeal on April 30, 2004 and he filed a Motion for of the same during the pendency of an appeal was clearly intended to
Reconsideration11 of the same on May 3, 2004. The RTC-Branch 227, cause [respondent] some form of harassment and/or humiliation so
in another Order12 dated May 31, 2004, granted respondent's latest that [respondent] would be ostracized by his neighbors. The appeal
motion because it was "convinced that it is but appropriate and fair to may have delayed the attainment of finality of the determination of the
both parties that this matter of whether or not the Appeal was filed on rights of the parties and the execution in the unlawful detainer case but
time, be resolved by the appellate court rather than by this Court." The it did not justify [herein petitioners'] pre-emption of the outcome of
RTC-Branch 227 then ordered that the records of the case be the appeal. By distributing copies of the MeTC decision, [petitioners]
forwarded as soon as possible to the Court of Appeals for further appeared to have assumed that the MeTC decision would simply be
proceedings. affirmed and therefore they tried to cause the early ouster of
[respondent] thinking that a humiliated [respondent] would scurry out
The Court of Appeals, in a Resolution13 dated February 8, 2005, of the leased premises. Clearly, there was evident bad faith intended
resolved to give due course to respondent's appeal. Said appeal was to mock [respondent's] right to appeal which is a statutory remedy to
docketed as CA-G.R. CV No. 82610. correct errors which might have been committed by the lower court.

On January 31, 2006, the Court of Appeals rendered its Decision in Thus, moral damages may be awarded since [petitioners] acted in bad
CA-G.R. CV No. 82610. The Court of Appeals fully agreed with the faith. Bad faith does not simply connote bad judgment or negligence,
RTC-Branch 227 in dismissing respondent's second cause of action it imports a dishonest purpose or some moral obliquity and conscious
(i.e., breach of contract) in Civil Case No. Q-02-48341. The appellate doing of a wrong, a breach of known duty through some motive or
court, however, held that RTC-Branch 227 should have proceeded interest or ill will that partakes of the nature of fraud. However, an
with the trial on the merits of the first cause of action (i.e., damages) award of moral damages would require certain conditions to be met,
in Civil Case No. Q-02-48341, because "[a]lthough [herein to wit: (1) first, there must be an injury, whether physical, mental or
respondent] may have stated the same factual antecedents that psychological, clearly sustained by the claimant; (2) second, there
transpired in the unlawful detainer case, such allegations were must be culpable act or omission factually established; (3) third, the
necessary to give an overview of the facts leading to the institution of wrongful act or omission of the defendant is the proximate cause of
another case between the parties before the RTC acting in its original the injury sustained by the claimant; and (4) fourth, the award of
jurisdiction."14 damages is predicated on any of the cases stated in Article 2219 of the
Civil Code.
The Court of Appeals then went on to find that petitioners were indeed
liable to respondent for damages: But it must again be stressed that moral damages are emphatically not
intended to enrich a plaintiff at the expense of the defendant. When
No doubt, distributing the copies was primarily intended to embarrass awarded, moral damages must not be palpably and scandalously
[herein respondent] in the community he mingled in. We are not excessive as to indicate that it was the result of passion, prejudice or
corruption on the part of the trial court judge. For this reason, this Petitioners argue in the alternative that the award of damages in
Court finds an award of ₱30,000.00 moral damages sufficient under respondent's favor has no factual and legal bases. They contend that
the circumstances. the Court of Appeals erred in awarding moral and exemplary damages
to respondent based on the bare and unproven allegations in the latter's
On the other hand, to warrant the award of exemplary damages, the complaint and without the benefit of any hearing or trial. While the
wrongful act must be accompanied by bad faith, and an award of appellate court declared that RTC-Branch 227 should have proceeded
damages would be allowed only if the guilty party acted in a wanton, with the trial on the merits involving the action for damages, it
fraudulent, reckless or malevolent manner. Accordingly, exemplary surprisingly went ahead and ruled on petitioners' liability for said
damages in the amount of ₱10,000.00 is appropriate. 15 damages even without trial. Even assuming for the sake of argument
that respondent's allegations in his complaint are true, he still has no
In the end, the Court of Appeals decreed: cause of action for damages against petitioners, for the disclosure of a
court decision, which is part of public record, did not cause any legal
WHEREFORE, the decision of the Regional Trial Court is and compensable injury to respondent.
AFFIRMED with the MODIFICATION that the case is dismissed
only as to the second cause of action. As to the first cause of action, Respondent, on the other hand, maintains that his appeal of the
[herein petitioners] are ordered to pay [herein respondent] moral September 2, 2003 Resolution of the RTC-Branch 227 to the Court of
damages of ₱30,000.00 and exemplary damages of ₱10,000.00.16 Appeals was timely filed and that the same was aptly given due course.
In addition, respondent asserts that the appellate court was correct in
Hence, the instant Petition for Review. holding petitioners liable for damages even without any hearing or
trial since petitioners, in filing their omnibus motion praying for the
Petitioners assert that respondent's appeal of the RTC-Branch 227 dismissal of respondent's complaint on the ground of "no cause of
Resolution dated September 2, 2003, which dismissed the latter's action," were deemed to have hypothetically admitted as true the
complaint in Civil Case No. Q-02-48341, was filed out of time. allegations in said complaint.
Respondent received a copy of the said resolution on September 26,
2003, and he only had 15 days from such date to file his appeal, or The petition is partly meritorious.
until October 11, 2003. Respondent, instead, filed a Motion for
Reconsideration of the resolution on October 10, 2003, which left him We note, at the outset, that the propriety of the dismissal by the RTC-
with only one more day to file his appeal. The RTC-Branch 227 Branch 227 of respondent's second cause of action against petitioners
subsequently denied respondent's Motion for Reconsideration in an (e.g., for breach of contract) was no longer disputed by the parties.
Order dated December 30, 2003, which the respondent received on Thus, the present appeal pertains only to respondent's first cause of
February 20, 2004. Respondent only had until the following day, action (e.g., for damages), and in connection therewith, we are called
February 21, 2004, to file the appeal. However, respondent filed his upon to resolve the following issues: (1) whether respondent timely
Notice of Appeal only on March 1, 2004. Hence, petitioners conclude filed his appeal of the Resolution dated September 2, 2003 of the RTC-
that the dismissal of respondent's complaint in Civil Case No. Q-02- Branch 227 before the Court of Appeals; and (2) whether respondent
48341 already attained finality. is entitled to the award of moral and exemplary damages.
We answer the first issue on the timeliness of respondent's appeal Propitious to petitioner is Neypes v. Court of Appeals, promulgated
affirmatively. on 14 September 2005 while the present Petition was already pending
before us. x x x.
Jurisprudence has settled the "fresh period rule," according to which,
an ordinary appeal from the RTC to the Court of Appeals, under xxxx
Section 3 of Rule 41 of the Rules of Court, shall be taken within fifteen
(15) days either from receipt of the original judgment of the trial court With the advent of the "fresh period rule" parties who availed
or from receipt of the final order of the trial court dismissing or themselves of the remedy of motion for reconsideration are now
denying the motion for new trial or motion for reconsideration. In allowed to file a notice of appeal within fifteen days from the denial
Sumiran v. Damaso,17 we presented a survey of the cases applying the of that motion.
fresh period rule:
The "fresh period rule" is not inconsistent with Rule 41, Section 3 of
As early as 2005, the Court categorically declared in Neypes v. Court the Revised Rules of Court which states that the appeal shall be taken
of Appeals that by virtue of the power of the Supreme Court to amend, "within fifteen (15) days from notice of judgment or final order
repeal and create new procedural rules in all courts, the Court is appealed from." The use of the disjunctive word "or" signifies
allowing a fresh period of 15 days within which to file a notice of disassociation and independence of one thing from another. It should,
appeal in the RTC, counted from receipt of the order dismissing or as a rule, be construed in the sense which it ordinarily implies. Hence,
denying a motion for new trial or motion for reconsideration. This the use of "or" in the above provision supposes that the notice of
would standardize the appeal periods provided in the Rules and do appeal may be filed within 15 days from the notice of judgment or
away with the confusion as to when the 15-day appeal period should within 15 days from notice of the "final order," x x x.
be counted. Thus, the Court stated:
xxxx
To recapitulate, a party-litigant may either file his notice of appeal
within 15 days from receipt of the Regional Trial Court's decision or The "fresh period rule" finally eradicates the confusion as to when the
file it within 15 days from receipt of the order (the "final order") 15-day appeal period should be counted - from receipt of notice of
denying his motion for new trial or motion for reconsideration. judgment or from receipt of notice of "final order" appealed from.
Obviously, the new 15-day period may be availed of only if either
motion is filed; otherwise, the decision becomes final and executory Taking our bearings from Neypes, in Sumaway v. Urban Bank, Inc.,
after the lapse of the original appeal period provided in Rule 41, we set aside the denial of a notice of appeal which was purportedly
Section 3. filed five days late. With the fresh period rule, the 15-day period
within which to file the notice of appeal was counted from notice of
The foregoing ruling of the Court was reiterated in Makati Insurance the denial of the therein petitioner's motion for reconsideration.
Co., Inc. v. Reyes, to wit:
We followed suit in Elbiña v. Ceniza, wherein we applied the principle
granting a fresh period of 15 days within which to file the notice of
appeal, counted from receipt of the order dismissing a motion for new procedural rules are procedural or remedial in character as they do not
trial or motion for reconsideration or any final order or resolution. create new or remove vested rights, but only operate in furtherance of
the remedy or confirmation of rights already existing. 19 (Emphases
Thereafter, in First Aqua Sugar Traders, Inc. v. Bank of the Philippine supplied.)
Islands, we held that a party-litigant may now file his notice of appeal
either within fifteen days from receipt of the original decision or In the case before us, respondent received a copy of the Resolution
within fifteen days from the receipt of the order denying the motion dated September 2, 2003 of the RTC-Branch 227 dismissing his
for reconsideration. complaint in Civil Case No. Q-02-48341 on September 26, 2003.
Fourteen days thereafter, on October 10, 2003, respondent filed a
In De los Santos v. Vda. de Mangubat, we applied the same principle Motion for Reconsideration of said resolution. The RTC-Branch 227
of "fresh period rule," expostulating that procedural law refers to the denied respondent's Motion for Reconsideration in an Order dated
adjective law which prescribes rules and forms of procedure in order December 30, 2003, which the respondent received on February 20,
that courts may be able to administer justice. Procedural laws do not 2004. On March 1, 2004, just after nine days from receipt of the order
come within the legal conception of a retroactive law, or the general denying his Motion for Reconsideration, respondent already filed his
rule against the retroactive operation of statutes. The "fresh period Notice of Appeal. Clearly, under the fresh period rule, respondent was
rule" is irrefragably procedural, prescribing the manner in which the able to file his appeal well-within the prescriptive period of 15 days,
appropriate period for appeal is to be computed or determined and, and the Court of Appeals did not err in giving due course to said appeal
therefore, can be made applicable to actions pending upon its in CA-G.R. CV No. 82610.
effectivity, such as the present case, without danger of violating
anyone else's rights.18 (Emphases supplied.) We likewise agree with the Court of Appeals that the RTC-Branch 227
should not have dismissed respondent's complaint for damages on the
Also in Sumiran, we recognized the retroactive application of the fresh ground of failure to state a cause of action.
period rule to cases pending and undetermined upon its effectivity:
According to Rule 2, Section 2 of the Rules of Court, a cause of action
The retroactivity of the Neypes rule in cases where the period for is the act or omission by which a party violates a right of another.
appeal had lapsed prior to the date of promulgation of Neypes on
September 14, 2005, was clearly explained by the Court in Fil-Estate When the ground for dismissal is that the complaint states no cause of
Properties, Inc. v. Homena-Valencia, stating thus: action, such fact can be determined only from the facts alleged in the
complaint and from no other, and the court cannot consider other
The determinative issue is whether the "fresh period" rule announced matters aliunde. The test, therefore, is whether, assuming the
in Neypes could retroactively apply in cases where the period for allegations of fact in the complaint to be true, a valid judgment could
appeal had lapsed prior to 14 September 2005 when Neypes was be rendered in accordance with the prayer stated therein. 20
promulgated. That question may be answered with the guidance of the
general rule that procedural laws may be given retroactive effect to Respondent made the following allegations in support of his claim for
actions pending and undetermined at the time of their passage, there damages against petitioners:
being no vested rights in the rules of procedure. Amendments to
FIRST CAUSE OF ACTION 30. In order to deter [petitioners] and others from doing as
abovementioned, [petitioners] should likewise be assessed exemplary
28. After the promulgation of the Metropolitan Trial Court of its damages in the amount of ₱500,000.00.21
Decision dated August 3, 1999, ordering the [herein respondent] and
all person claiming rights under him to - A cause of action (for damages) exists if the following elements are
present: (1) a right in favor of the plaintiff by whatever means and
(a) Vacate the leased premises; under whatever law it arises or is created; (2) an obligation on the part
of the named defendant to respect or not to violate such right; and (3)
(b) pay the [herein petitioners] the sum of ₱306,000.00 as an act or omission on the part of such defendant violative of the right
unpaid rentals from May 23, 1997 to November 22, 1998; and of the plaintiff or constituting a breach of the obligation of defendant
to the plaintiff for which the latter may maintain an action for recovery
(c) pay the sum of ₱5,000.00 as attorneys fees; of damages.22 We find that all three elements exist in the case at bar.
Respondent may not have specifically identified each element, but it
But while said Decision was still pending appeal with the Regional may be sufficiently determined from the allegations in his complaint.
Trial Court, the [petitioners], through [petitioner] Manaloto, already
distributed copies of said Decision to some of the homeowners of First, respondent filed the complaint to protect his good character,
Horseshoe Village, who personally know the [respondent]. This act is name, and reputation. Every man has a right to build, keep, and be
a direct assault or character assassination on the part of the favored with a good name. This right is protected by law with the
[respondent] because as stated in the said decision, [respondent] has recognition of slander and libel as actionable wrongs, whether as
been staying in the premises but did not or refused to pay his monthly criminal offenses or tortuous conduct.23
rentals for a long period of time when in truth and in fact was untrue.
Second, petitioners are obliged to respect respondent's good name
29. That from the time the said decision was distributed to said even though they are opposing parties in the unlawful detainer case.
members homeowners, the [respondent] became the subject of As Article 19 of the Civil Code requires, "[e]very person must, in the
conversation or talk of the town and by virtue of which [respondent's] exercise of his rights and in the performance of his duties, act with
good name within the community or society where he belongs was justice, give everyone his due, and observe honesty and good faith."
greatly damaged; his reputation was besmirched; [respondent] A violation of such principle constitutes an abuse of rights, a tortuous
suffered sleepless night and serious anxiety. [Respondent], who is the conduct. We expounded in Sea Commercial Company, Inc. v. Court
grandson of the late Senator Jose Veloso and Congressman Ismael of Appeals24 that:
Veloso, was deprived of political career and to start with was to run as
candidate for Barangay Chairman within their area which was being The principle of abuse of rights stated in the above article, departs
offered to him by the homeowners but this offer has started to fade and from the classical theory that "he who uses a right injures no one." The
ultimately totally vanished after the distribution of said Decision. modern tendency is to depart from the classical and traditional theory,
Damages to his good names and reputations and other damages which and to grant indemnity for damages in cases where there is an abuse
he suffered as a consequence thereof, may be reasonably compensated of rights, even when the act is not illicit.
for at least ₱1,500,000.00 as moral and consequential damages.
Article 19 was intended to expand the concept of torts by granting (3) Intriguing to cause another to be alienated from his friends;
adequate legal remedy for the untold number of moral wrongs which
is impossible for human foresight to provide specifically in statutory (4) Vexing or humiliating another on account of his religious
law. If mere fault or negligence in one's acts can make him liable for beliefs, lowly station in life, place of birth, physical defect, or
damages for injury caused thereby, with more reason should abuse or other personal condition.
bad faith make him liable. The absence of good faith is essential to
abuse of right. Good faith is an honest intention to abstain from taking Thus, Article 2219(10) of the Civil Code allows the recovery of moral
any unconscientious advantage of another, even through the forms or damages for acts and actions referred to in Article 26, among other
technicalities of the law, together with an absence of all information provisions, of the Civil Code.
or belief of fact which would render the transaction unconscientious.
In business relations, it means good faith as understood by men of In Concepcion v. Court of Appeals, 26 we explained that:
affairs.
The philosophy behind Art. 26 underscores the necessity for its
While Article 19 may have been intended as a mere declaration of inclusion in our civil law. The Code Commission stressed in no
principle, the "cardinal law on human conduct" expressed in said uncertain terms that the human personality must be exalted. The
article has given rise to certain rules, e.g. that where a person exercises sacredness of human personality is a concomitant consideration of
his rights but does so arbitrarily or unjustly or performs his duties in a every plan for human amelioration. The touchstone of every system of
manner that is not in keeping with honesty and good faith, he opens law, of the culture and civilization of every country, is how far it
himself to liability. The elements of an abuse of rights under Article dignifies man. If the statutes insufficiently protect a person from being
19 are: (1) there is a legal right or duty; (2) which is exercised in bad unjustly humiliated, in short, if human personality is not exalted - then
faith; (3) for the sole intent of prejudicing or injuring another. 25 the laws are indeed defective. Thus, under this article, the rights of
persons are amply protected, and damages are provided for violations
Petitioners are also expected to respect respondent's "dignity, of a person's dignity, personality, privacy and peace of mind.
personality, privacy and peace of mind" under Article 26 of the Civil
Code, which provides: It is petitioner's position that the act imputed to him does not constitute
any of those enumerated in Arts. 26 and 2219. In this respect, the law
ART. 26. Every person shall respect the dignity, personality, privacy is clear. The violations mentioned in the codal provisions are not
and peace of mind of his neighbors and other persons. The following exclusive but are merely examples and do not preclude other similar
and similar acts, though they may not constitute a criminal offense, or analogous acts. Damages therefore are allowable for actions against
shall produce a cause of action for damages, prevention and other a person's dignity, such as profane, insulting, humiliating, scandalous
relief: or abusive language. Under Art. 2217 of the Civil Code, moral
damages which include physical suffering, mental anguish, fright,
(1) Prying into the privacy of another's residence; serious anxiety, besmirched reputation, wounded feelings, moral
shock, social humiliation, and similar injury, although incapable of
(2) Meddling with or disturbing the private life or family pecuniary computation, may be recovered if they are the proximate
relations of another; result of the defendant's wrongful act or omission. 27
And third, respondent alleged that the distribution by petitioners to evidence are not equivalent to proof under our Rules. In short, mere
Horseshoe Village homeowners of copies of the MeTC decision in the allegations are not evidence.29
unlawful detainer case, which was adverse to respondent and still on
appeal before the RTC-Branch 88, had no apparent lawful or just At this point, the finding of the Court of Appeals of bad faith and
purpose except to humiliate respondent or assault his character. As a malice on the part of petitioners has no factual basis. Good faith is
result, respondent suffered damages - becoming the talk of the town presumed and he who alleges bad faith has the duty to prove the same.
and being deprived of his political career. Good faith refers to the state of the mind which is manifested by the
acts of the individual concerned. It consists of the intention to abstain
Petitioners reason that respondent has no cause of action against them from taking an unconscionable and unscrupulous advantage of
since the MeTC decision in the unlawful detainer case was part of another. Bad faith, on the other hand, does not simply connote bad
public records. judgment to simple negligence. It imports a dishonest purpose or some
moral obliquity and conscious doing of a wrong, a breach of known
It is already settled that the public has a right to see and copy judicial duty due to some motive or interest or ill will that partakes of the
records and documents.28 However, this is not a case of the public nature of fraud. Malice connotes ill will or spite and speaks not in
seeking and being denied access to judicial records and documents. response to duty. It implies an intention to do ulterior and unjustifiable
The controversy is rooted in the dissemination by petitioners of the harm.30
MeTC judgment against respondent to Horseshoe Village
homeowners, who were not involved at all in the unlawful detainer We cannot subscribe to respondent's argument that there is no more
case, thus, purportedly affecting negatively respondent's good name need for the presentation of evidence by the parties since petitioners,
and reputation among said homeowners. The unlawful detainer case in moving for the dismissal of respondent's complaint for damages,
was a private dispute between petitioners and respondent, and the hypothetically admitted respondent's allegations. The hypothetical
MeTC decision against respondent was then still pending appeal admission of respondent's allegations in the complaint only goes so far
before the RTC-Branch 88, rendering suspect petitioners' intentions as determining whether said complaint should be dismissed on the
for distributing copies of said MeTC decision to non-parties in the ground of failure to state a cause of action. A finding that the
case. While petitioners were free to copy and distribute such copies of complaint sufficiently states a cause of action does not necessarily
the MeTC judgment to the public, the question is whether they did so mean that the complaint is meritorious; it shall only result in the
with the intent of humiliating respondent and destroying the latter's reinstatement of the complaint and the hearing of the case for
good name and reputation in the community. presentation of evidence by the parties.

Nevertheless, we further declare that the Court of Appeals erred in WHEREFORE, in view of all the foregoing, the petition is
already awarding moral and exemplary damages in respondent's favor PARTIALLY GRANTED. The Decision dated January 31, 2006 of
when the parties have not yet had the chance to present any evidence the Court of Appeals in CA-G.R. CV No. 82610 is AFFIRMED WITH
before the RTC-Branch 227. In civil cases, he who alleges a fact has MODIFICATIONS. The award of moral and exemplary damages
the burden of proving it by a preponderance of evidence. It is made by the Court of Appeals in favor of respondent Ismael Veloso
incumbent upon the party claiming affirmative relief from the court to III is DELETED. The complaint of respondent Ismael Veloso III in
convincingly prove its claim. Bare allegations, unsubstantiated by Civil Case No. Q-02-48341 is hereby REINSTATED before Branch
227 of the Regional Trial Court of Quezon City only in so far as the
first cause of action is concerned. The said court is DIRECTED to hear
and dispose of the case with dispatch.

SO ORDERED.
G.R. No. L-14628 September 30, 1960 On appeal taken by petitioner, the Court of Appeals affirmed this
decision, except as to the actual and compensatory damages and the
FRANCISCO HERMOSISIMA, petitioner, moral damages, which were increased to P5,614.25 and P7,000.00,
vs. respectively.
THE HON. COURT OF APPEALS, ET AL., respondents.
The main issue before us is whether moral damages are recoverable,
Regino Hermosisima for petitioner. under our laws, for breach of promise to marry. The pertinent facts
F.P. Gabriel, Jr. for respondents. are:

CONCEPCION, J.: Complainant Soledad Cagigas, was born in July 1917. Since 1950,
Soledad then a teacher in the Sibonga Provincial High School in Cebu,
An appeal by certiorari, taken by petitioner Francisco Hermosisima, and petitioner, who was almost ten (10) years younger than she, used
from a decision of Court of Appeals modifying that of the Court of to go around together and were regarded as engaged, although he had
First Instance of Cebu. made no promise of marriage prior thereto. In 1951, she gave up
teaching and became a life insurance underwriter in the City of Cebu,
On October 4, 1954, Soledad Cagigas, hereinafter referred to as where intimacy developed among her and the petitioner, since one
complaint, filed with said of her child, Chris Hermosisima, as natural evening in 1953, when after coming from the movies, they had sexual
child and moral damages for alleged breach of promise. Petitioner intercourse in his cabin on board M/V "Escaño," to which he was then
admitted the paternity of child and expressed willingness to support attached as apprentice pilot. In February 1954, Soledad advised
the latter, but denied having ever promised to marry the complainant. petitioner that she was in the family way, whereupon he promised to
Upon her motion, said court ordered petitioner, on October 27, 1954, marry her. Their child, Chris Hermosisima, was born on June 17,
to pay, by way of alimony pendente lite, P50.00 a month, which was, 1954, in a private maternity and clinic. However, subsequently, or on
on February 16, 1955, reduced to P30.00 a month. In due course, later July 24, 1954, defendant married one Romanita Perez. Hence, the
on, said court rendered a decision the dispositive part of which reads: present action, which was commenced on or about October 4, 1954.

WHEREFORE, judgment is hereby rendered, declaring the Referring now to the issue above referred to, it will be noted that the
child, Chris Hermosisima, as the natural daughter of Civil Code of Spain permitted the recovery of damages for breach to
defendant, and confirming the order pendente lite, ordering marry. Article 43 and 44 of said Code provides:
defendant to pay to the said child, through plaintiff, the sum
of thirty pesos (P30.00), payable on or before the fifth day of ART. 43. A mutual promise of marriage shall not give rise to
every month sentencing defendant to pay to plaintiff the sum an obligation to contract marriage. No court shall entertain
of FOUR THOUSAND FIVE HUNDRED PESOS any complaint by which the enforcement of such promise is
(P4,500.00) for actual and compensatory damages; the sum of sought.
FIVE THOUSAND PESOS (P5,000.00) as moral damages;
and the further sum of FIVE HUNDRED PESOS (P500.00) ART. 44. If the promise has been in a public or private
as attorney's fees for plaintiff, with costs against defendant. instrument by an adult, or by a minor with the concurrence of
 the person whose consent is necessary for the celebration of Art. 57. An engagement to be married must be agreed directly
the marriage, or if the banns have been published, the one who by the future spouses.
without just cause refuses to marry shall be obliged to
reimburse the other for the expenses which he or she may have Art. 58. A contract for a future marriage cannot, without the
incurred by reason of the promised marriage. consent of the parent or guardian, be entered into by a male
between the ages of sixteen and twenty years or by a female
The action for reimbursement of expenses to which the between the ages of sixteen and eighteen years. Without such
foregoing article refers must be brought within one year, consent of the parents or guardian, the engagement to marry
computed from the day of the refusal to celebrate the cannot be the basis of a civil action for damages in case of
marriage. breach of the promise.

Inasmuch as these articles were never in force in the Philippines, this Art. 59. A promise to marry when made by a female under the
Court ruled in De Jesus vs. Syquia (58 Phil., 866), that "the action for age of fourteen years is not civilly actionable, even though
breach of promises to marry has no standing in the civil law, apart approved by the parent or guardian.
from the right to recover money or property advanced . . . upon the
faith of such promise". The Code Commission charged with the Art. 60. In cases referred to in the proceeding articles, the
drafting of the Proposed Civil Code of the Philippines deem it best, criminal and civil responsibility of a male for seduction shall
however, to change the law thereon. We quote from the report of the not be affected.
Code Commission on said Proposed Civil Code:
Art. 61. No action for specific performance of a mutual
Articles 43 and 44 the Civil Code of 1889 refer to the promise promise to marry may be brought.
of marriage. But these articles are not enforced in the
Philippines. The subject is regulated in the Proposed Civil Art. 62. An action for breach of promise to marry may be
Code not only as to the aspect treated of in said articles but brought by the aggrieved party even though a minor without
also in other particulars. It is advisable to furnish legislative the assistance of his parent or guardian. Should the minor
solutions to some questions that might arise relative to refuse to bring suit, the parent or guardian may institute the
betrothal. Among the provisions proposed are: That action.
authorizing the adjudication of moral damages, in case of
breach of promise of marriage, and that creating liability for Art. 63. Damages for breach of promise to marry shall include
causing a marriage engagement to be broken. not only material and pecuniary losses but also compensation
for mental and moral suffering.
Accordingly, the following provisions were inserted in said Proposed
Civil Code, under Chapter I, Title III, Book I thereof: Art. 64. Any person, other than a rival, the parents, guardians
and grandparents, of the affianced parties, who cause a
Art. 56. A mutual promise to marry may be made expressly or marriage engagement to be broken shall be liable for damages,
impliedly.
 both material and moral, to the engaged person who is The Commission perhaps though that it has followed the more
rejected. progression trend in legislation when it provided for breach of
promise to marry suits. But it is clear that the creation of such
Art. 65. In case of breach of promise to marry, the party causes of action at a time when so many States, in
breaking the engagement shall be obliged to return what he or consequence of years of experience are doing away with them,
she has received from the other as gift on account of the may well prove to be a step in the wrong direction.
promise of the marriage. (Congressional Record, Vol. IV, No. 79, Thursday, May 19,
1949, p. 2352.)
These article were, however, eliminated in Congress. The reason
therefor are set forth in the report of the corresponding Senate The views thus expressed were accepted by both houses of Congress.
Committee, from which we quote: In the light of the clear and manifest intent of our law making body
not to sanction actions for breach of promise to marry, the award of
The elimination of this Chapter is proposed. That breach of promise moral damages made by the lower courts is, accordingly, untenable.
to marry is not actionable has been definitely decide in the case of De The Court of Appeals said award:
Jesus vs. Syquia, 58 Phil., 866. The history of breach of promise suit
in the United States and in England has shown that no other action Moreover, it appearing that because of defendant-appellant's
lends itself more readily to abuse by designing women and seduction power, plaintiff-appellee, overwhelmed by her love
unscrupulous men. It is this experience which has led to the abolition for him finally yielded to his sexual desires in spite of her age
of the rights of action in the so-called Balm suit in many of the and self-control, she being a woman after all, we hold that said
American States. defendant-appellant is liable for seduction and, therefore,
moral damages may be recovered from him under the
See statutes of: provision of Article 2219, paragraph 3, of the new Civil Code.

Florida 1945 — pp. 1342 — 1344 Apart from the fact that the general tenor of said Article 2219,
Maryland 1945 — pp. 1759 — 1762 particularly the paragraphs preceding and those following the one
Nevada 1943 — p. 75 cited by the Court of Appeals, and the language used in said paragraph
Maine 1941 — pp. 140 — 141 strongly indicates that the "seduction" therein contemplated is
New Hampshire 1941 — p. 223 the crime punished as such in Article as such in Article 337 and 338
California 1939 — p. 1245 of the Revised Penal Code, which admittedly does not exist in the
Massachusetts 1938 — p. 326 present case, we find ourselves unable to say that petitioner
Indiana 1936 — p. 1009 is morally guilty of seduction, not only because he is approximately
Michigan 1935 — p. 201 ten (10) years younger than the complainant — who around thirty-six
New York 1935 (36) years of age, and as highly enlightened as a former high school
Pennsylvania p. 450 teacher and a life insurance agent are supposed to be — when she
became intimate with petitioner, then a mere apprentice pilot, but,
also, because, the court of first instance found that, complainant
"surrendered herself" to petitioner because, "overwhelmed by her
love" for him, she "wanted to bind" "by having a fruit of their
engagement even before they had the benefit of clergy."

The court of first instance sentenced petitioner to pay the following:

(1) a monthly pension of P30.00 for the support of the child: (2)
P4,500, representing the income that complainant had allegedly failed
to earn during her pregnancy and shortly after the birth of the child, as
actual and compensation damages; (3) P5,000, as moral damages; and
(4) P500.00, as attorney's fees. The Court of Appeals added to the
second item the sum of P1,114.25 — consisting of P144.20, for
hospitalization and medical attendance, in connection with the
parturiation, and the balance representing expenses incurred to support
the child — and increased the moral damages to P7,000.00.

With the elimination of this award for damages, the decision of the
Court of Appeals is hereby affirmed, therefore, in all other respects,
without special pronouncement as to cost in this instance. It is so
ordered.
G.R. No. L-20089 December 26, 1964 NOTHING CHANGED REST ASSURED
RETURNING VERY SOON APOLOGIZE MAMA
BEATRIZ P. WASSMER, plaintiff-appellee, PAPA LOVE .
vs.
FRANCISCO X. VELEZ, defendant-appellant. PAKING

Jalandoni & Jamir for defendant-appellant. Thereafter Velez did not appear nor was he heard from again.
Samson S. Alcantara for plaintiff-appellee.
Sued by Beatriz for damages, Velez filed no answer and was declared
BENGZON, J.P., J.: in default. Plaintiff adduced evidence before the clerk of court as
commissioner, and on April 29, 1955, judgment was rendered
The facts that culminated in this case started with dreams and hopes, ordering defendant to pay plaintiff P2,000.00 as actual damages;
followed by appropriate planning and serious endeavors, but P25,000.00 as moral and exemplary damages; P2,500.00 as attorney's
terminated in frustration and, what is worse, complete public fees; and the costs.
humiliation.
On June 21, 1955 defendant filed a "petition for relief from orders,
Francisco X. Velez and Beatriz P. Wassmer, following their mutual judgment and proceedings and motion for new trial and
promise of love, decided to get married and set September 4, 1954 as reconsideration." Plaintiff moved to strike it cut. But the court, on
the big day. On September 2, 1954 Velez left this note for his bride- August 2, 1955, ordered the parties and their attorneys to appear
to-be: before it on August 23, 1955 "to explore at this stage of the
proceedings the possibility of arriving at an amicable settlement." It
Dear Bet — added that should any of them fail to appear "the petition for relief and
the opposition thereto will be deemed submitted for resolution."
Will have to postpone wedding — My mother
opposes it. Am leaving on the Convair today. On August 23, 1955 defendant failed to appear before court. Instead,
on the following day his counsel filed a motion to defer for two weeks
Please do not ask too many people about the reason the resolution on defendants petition for relief. The counsel stated that
why — That would only create a scandal. he would confer with defendant in Cagayan de Oro City — the latter's
residence — on the possibility of an amicable element. The court
Paquing granted two weeks counted from August 25, 1955.

Plaintiff manifested on June 15, 1956 that the two weeks given by the
But the next day, September 3, he sent her the following telegram:
court had expired on September 8, 1955 but that defendant and his
counsel had failed to appear.
Another chance for amicable settlement was given by the court in its In support of his "motion for new trial and reconsideration," defendant
order of July 6, 1956 calling the parties and their attorneys to appear asserts that the judgment is contrary to law. The reason given is that
on July 13, 1956. This time. however, defendant's counsel informed "there is no provision of the Civil Code authorizing" an action for
the court that chances of settling the case amicably were nil. breach of promise to marry. Indeed, our ruling in Hermosisima vs.
Court of Appeals (L-14628, Sept. 30, 1960), as reiterated in Estopa vs.
On July 20, 1956 the court issued an order denying defendant's Biansay (L-14733, Sept. 30, 1960), is that "mere breach of a promise
aforesaid petition. Defendant has appealed to this Court. In his petition to marry" is not an actionable wrong. We pointed out that Congress
of June 21, 1955 in the court a quo defendant alleged excusable deliberately eliminated from the draft of the new Civil Code the
negligence as ground to set aside the judgment by default. provisions that would have it so.
Specifically, it was stated that defendant filed no answer in the belief
that an amicable settlement was being negotiated. It must not be overlooked, however, that the extent to which acts not
contrary to law may be perpetrated with impunity, is not limitless for
A petition for relief from judgment on grounds of fraud, accident, Article 21 of said Code provides that "any person who wilfully causes
mistake or excusable negligence, must be duly supported by an loss or injury to another in a manner that is contrary to morals, good
affidavit of merits stating facts constituting a valid defense. (Sec. 3, customs or public policy shall compensate the latter for the damage."
Rule 38, Rules of Court.) Defendant's affidavit of merits attached to
his petition of June 21, 1955 stated: "That he has a good and valid The record reveals that on August 23, 1954 plaintiff and defendant
defense against plaintiff's cause of action, his failure to marry the applied for a license to contract marriage, which was subsequently
plaintiff as scheduled having been due to fortuitous event and/or issued (Exhs. A, A-1). Their wedding was set for September 4, 1954.
circumstances beyond his control." An affidavit of merits like this Invitations were printed and distributed to relatives, friends and
stating mere conclusions or opinions instead of facts is not valid. acquaintances (Tsn., 5; Exh. C). The bride-to-be's trousseau, party
(Cortes vs. Co Bun Kim, L-3926, Oct. 10, 1951; Vaswani vs. P. drsrses and other apparel for the important occasion were purchased
Tarrachand Bros., L-15800, December 29, 1960.) (Tsn., 7-8). Dresses for the maid of honor and the flower girl were
prepared. A matrimonial bed, with accessories, was bought. Bridal
Defendant, however, would contend that the affidavit of merits was in showers were given and gifts received (Tsn., 6; Exh. E). And then,
fact unnecessary, or a mere surplusage, because the judgment sought with but two days before the wedding, defendant, who was then 28
to be set aside was null and void, it having been based on evidence years old,: simply left a note for plaintiff stating: "Will have to
adduced before the clerk of court. In Province of Pangasinan vs. postpone wedding — My mother opposes it ... " He enplaned to his
Palisoc, L-16519, October 30, 1962, this Court pointed out that the home city in Mindanao, and the next day, the day before the wedding,
procedure of designating the clerk of court as commissioner to receive he wired plaintiff: "Nothing changed rest assured returning soon." But
evidence is sanctioned by Rule 34 (now Rule 33) of the Rules of Court. he never returned and was never heard from again.
Now as to defendant's consent to said procedure, the same did not have
to be obtained for he was declared in default and thus had no standing Surely this is not a case of mere breach of promise to marry. As stated,
in court (Velez vs. Ramas, 40 Phil. 787; Alano vs. Court of First mere breach of promise to marry is not an actionable wrong. But to
Instance, L-14557, October 30, 1959). formally set a wedding and go through all the above-described
preparation and publicity, only to walk out of it when the matrimony
is about to be solemnized, is quite different. This is palpably and
unjustifiably contrary to good customs for which defendant must be
held answerable in damages in accordance with Article 21 aforesaid.

Defendant urges in his afore-stated petition that the damages awarded

were excessive. No question is raised as to the award of actual
damages. What defendant would really assert hereunder is that the
award of moral and exemplary damages, in the amount of P25,000.00,
should be totally eliminated.

Per express provision of Article 2219 (10) of the New Civil Code,
moral damages are recoverable in the cases mentioned in Article 21 of
said Code. As to exemplary damages, defendant contends that the
same could not be adjudged against him because under Article 2232
of the New Civil Code the condition precedent is that "the defendant
acted in a wanton, fraudulent, reckless, oppressive, or malevolent
manner." The argument is devoid of merit as under the above-narrated
circumstances of this case defendant clearly acted in a "wanton ... ,
reckless [and] oppressive manner." This Court's opinion, however, is
that considering the particular circumstances of this case, P15,000.00
as moral and exemplary damages is deemed to be a reasonable award.

PREMISES CONSIDERED, with the above-indicated modification,

the lower court's judgment is hereby affirmed, with costs.
G.R. No. 97336 February 19, 1993 accepted his love on the condition that they would get married; they
therefore agreed to get married after the end of the school semester,
GASHEM SHOOKAT BAKSH, petitioner, which was in October of that year; petitioner then visited the private
vs. respondent's parents in Bañaga, Bugallon, Pangasinan to secure their
HON. COURT OF APPEALS and MARILOU T. approval to the marriage; sometime in 20 August 1987, the petitioner
GONZALES, respondents. forced her to live with him in the Lozano Apartments; she was a virgin
before she began living with him; a week before the filing of the
Public Attorney's Office for petitioner. complaint, petitioner's attitude towards her started to change; he
maltreated and threatened to kill her; as a result of such maltreatment,
Corleto R. Castro for private respondent. she sustained injuries; during a confrontation with a representative of
the barangay captain of Guilig a day before the filing of the complaint,
petitioner repudiated their marriage agreement and asked her not to
live with him anymore and; the petitioner is already married to
someone living in Bacolod City. Private respondent then prayed for
DAVIDE, JR., J.: judgment ordering the petitioner to pay her damages in the amount of
not less than P45,000.00, reimbursement for actual expenses
This is an appeal by certiorari under Rule 45 of the Rules of Court amounting to P600.00, attorney's fees and costs, and granting her such
seeking to review and set aside the Decision1 of the respondent Court other relief and remedies as may be just and equitable. The complaint
of Appeals in CA-G.R. CV No. 24256 which affirmed in toto the 16 was docketed as Civil Case No. 16503.
October 1939 Decision of Branch 38 (Lingayen) of the Regional Trial
Court (RTC) of Pangasinan in Civil Case No. 16503. Presented is the
In his Answer with Counterclaim,3 petitioner admitted only the
issue of whether or not damages may be recovered for a breach of
personal circumstances of the parties as averred in the complaint and
promise to marry on the basis of Article 21 of the Civil Code of the
denied the rest of the allegations either for lack of knowledge or
Philippines.
information sufficient to form a belief as to the truth thereof or because
the true facts are those alleged as his Special and Affirmative
The antecedents of this case are not complicated: Defenses. He thus claimed that he never proposed marriage to or
agreed to be married with the private respondent; he neither sought the
On 27 October 1987, private respondent, without the assistance of consent and approval of her parents nor forced her to live in his
counsel, filed with the aforesaid trial court a complaint 2 for damages apartment; he did not maltreat her, but only told her to stop coming to
against the petitioner for the alleged violation of their agreement to get his place because he discovered that she had deceived him by stealing
married. She alleges in said complaint that: she is twenty-two (22) his money and passport; and finally, no confrontation took place with
years old, single, Filipino and a pretty lass of good moral character a representative of the barangay captain. Insisting, in his
and reputation duly respected in her community; petitioner, on the Counterclaim, that the complaint is baseless and unfounded and that
other hand, is an Iranian citizen residing at the Lozano Apartments, as a result thereof, he was unnecessarily dragged into court and
Guilig, Dagupan City, and is an exchange student taking a medical compelled to incur expenses, and has suffered mental anxiety and a
course at the Lyceum Northwestern Colleges in Dagupan City; before
20 August 1987, the latter courted and proposed to marry her; she
besmirched reputation, he prayed for an award of P5,000.00 for 1. Condemning (sic) the defendant to pay the plaintiff
miscellaneous expenses and P25,000.00 as moral damages. the sum of twenty thousand (P20,000.00) pesos as
moral damages.
After conducting a pre-trial on 25 January 1988, the trial court issued
a Pre-Trial Order4 embodying the stipulated facts which the parties 2. Condemning further the defendant to play the
had agreed upon, to wit: plaintiff the sum of three thousand (P3,000.00) pesos
as atty's fees and two thousand (P2,000.00) pesos at
1. That the plaintiff is single and resident (sic) of (sic) litigation expenses and to pay the costs.
Bañaga, Bugallon, Pangasinan, while the defendant is
single, Iranian citizen and resident (sic) of Lozano 3. All other claims are denied.6
Apartment, Guilig, Dagupan City since September 1,
1987 up to the present; The decision is anchored on the trial court's findings and conclusions
that (a) petitioner and private respondent were lovers, (b) private
2. That the defendant is presently studying at Lyceum respondent is not a woman of loose morals or questionable virtue who
Northwestern, Dagupan City, College of Medicine, readily submits to sexual advances, (c) petitioner, through
second year medicine proper; machinations, deceit and false pretenses, promised to marry private
respondent, d) because of his persuasive promise to marry her, she
3. That the plaintiff is (sic) an employee at Mabuhay allowed herself to be deflowered by him, (e) by reason of that deceitful
Luncheonette , Fernandez Avenue, Dagupan City promise, private respondent and her parents — in accordance with
since July, 1986 up to the present and a (sic) high Filipino customs and traditions — made some preparations for the
school graduate; wedding that was to be held at the end of October 1987 by looking for
pigs and chickens, inviting friends and relatives and contracting
4. That the parties happened to know each other when sponsors, (f) petitioner did not fulfill his promise to marry her and (g)
the manager of the Mabuhay Luncheonette, Johhny such acts of the petitioner, who is a foreigner and who has abused
Rabino introduced the defendant to the plaintiff on Philippine hospitality, have offended our sense of morality, good
August 3, 1986. customs, culture and traditions. The trial court gave full credit to the
private respondent's testimony because, inter alia, she would not have
After trial on the merits, the lower court, applying Article 21 of the had the temerity and courage to come to court and expose her honor
Civil Code, rendered on 16 October 1989 a decision5 favoring the and reputation to public scrutiny and ridicule if her claim was false. 7
private respondent. The petitioner was thus ordered to pay the latter
damages and attorney's fees; the dispositive portion of the decision The above findings and conclusions were culled from the detailed
reads: summary of the evidence for the private respondent in the foregoing
decision, digested by the respondent Court as follows:
IN THE LIGHT of the foregoing consideration,
judgment is hereby rendered in favor of the plaintiff According to plaintiff, who claimed that she was a
and against the defendant. virgin at the time and that she never had a boyfriend
before, defendant started courting her just a few days the barangay captain went to talk to defendant to still
after they first met. He later proposed marriage to her convince him to marry plaintiff, but defendant
several times and she accepted his love as well as his insisted that he could not do so because he was
proposal of marriage on August 20, 1987, on which already married to a girl in Bacolod City, although the
same day he went with her to her hometown of truth, as stipulated by the parties at the pre-trial, is that
Bañaga, Bugallon, Pangasinan, as he wanted to meet defendant is still single.
her parents and inform them of their relationship and
their intention to get married. The photographs Exhs. Plaintiff's father, a tricycle driver, also claimed that
"A" to "E" (and their submarkings) of defendant with after defendant had informed them of his desire to
members of plaintiff's family or with plaintiff, were marry Marilou, he already looked for sponsors for the
taken that day. Also on that occasion, defendant told wedding, started preparing for the reception by
plaintiffs parents and brothers and sisters that he looking for pigs and chickens, and even already
intended to marry her during the semestral break in invited many relatives and friends to the forthcoming
October, 1987, and because plaintiff's parents thought wedding. 8
he was good and trusted him, they agreed to his
proposal for him to marry their daughter, and they Petitioner appealed the trial court's decision to the respondent Court
likewise allowed him to stay in their house and sleep of Appeals which docketed the case as CA-G.R. CV No. 24256. In his
with plaintiff during the few days that they were in Brief,9 he contended that the trial court erred (a) in not dismissing the
Bugallon. When plaintiff and defendant later returned case for lack of factual and legal basis and (b) in ordering him to pay
to Dagupan City, they continued to live together in moral damages, attorney's fees, litigation expenses and costs.
defendant's apartment. However, in the early days of
October, 1987, defendant would tie plaintiff's hands On 18 February 1991, respondent Court promulgated the challenged
and feet while he went to school, and he even gave decision 10 affirming in toto the trial court's ruling of 16 October 1989.
her medicine at 4 o'clock in the morning that made In sustaining the trial court's findings of fact, respondent Court made
her sleep the whole day and night until the following the following analysis:
day. As a result of this live-in relationship, plaintiff
became pregnant, but defendant gave her some
First of all, plaintiff, then only 21 years old when she
medicine to abort the fetus. Still plaintiff continued to met defendant who was already 29 years old at the
live with defendant and kept reminding him of his time, does not appear to be a girl of loose morals. It is
promise to marry her until he told her that he could uncontradicted that she was a virgin prior to her
not do so because he was already married to a girl in
unfortunate experience with defendant and never had
Bacolod City. That was the time plaintiff left boyfriend. She is, as described by the lower court, a
defendant, went home to her parents, and thereafter barrio lass "not used and accustomed to trend of
consulted a lawyer who accompanied her to the modern urban life", and certainly would (sic) not have
barangay captain in Dagupan City. Plaintiff, her allowed
lawyer, her godmother, and a barangay tanod sent by "herself to be deflowered by the defendant if there
was no persuasive promise made by the defendant to Upon the other hand, appellant does not appear to be
marry her." In fact, we agree with the lower court that a man of good moral character and must think so low
plaintiff and defendant must have been sweethearts or and have so little respect and regard for Filipino
so the plaintiff must have thought because of the women that he openly admitted that when he studied
deception of defendant, for otherwise, she would not in Bacolod City for several years where he finished
have allowed herself to be photographed with his B.S. Biology before he came to Dagupan City to
defendant in public in so (sic) loving and tender poses study medicine, he had a common-law wife in
as those depicted in the pictures Exhs. "D" and "E". Bacolod City. In other words, he also lived with
We cannot believe, therefore, defendant's pretense another woman in Bacolod City but did not marry that
that plaintiff was a nobody to him except a waitress at woman, just like what he did to plaintiff. It is not
the restaurant where he usually ate. Defendant in fact surprising, then, that he felt so little compunction or
admitted that he went to plaintiff's hometown of remorse in pretending to love and promising to marry
Bañaga, Bugallon, Pangasinan, at least thrice; at (sic) plaintiff, a young, innocent, trustful country girl, in
the town fiesta on February 27, 1987 (p. 54, tsn May order to satisfy his lust on her. 11
18, 1988), at (sic) a beach party together with the
manager and employees of the Mabuhay and then concluded:
Luncheonette on March 3, 1987 (p. 50, tsn id.), and
on April 1, 1987 when he allegedly talked to In sum, we are strongly convinced and so hold that it
plaintiff's mother who told him to marry her daughter was defendant-appellant's fraudulent and deceptive
(pp. 55-56, tsn id.). Would defendant have left protestations of love for and promise to marry
Dagupan City where he was involved in the serious plaintiff that made her surrender her virtue and
study of medicine to go to plaintiff's hometown in womanhood to him and to live with him on the honest
Bañaga, Bugallon, unless there was (sic) some kind and sincere belief that he would keep said promise,
of special relationship between them? And this and it was likewise these (sic) fraud and deception on
special relationship must indeed have led to appellant's part that made plaintiff's parents agree to
defendant's insincere proposal of marriage to their daughter's living-in with him preparatory to their
plaintiff, communicated not only to her but also to her supposed marriage. And as these acts of appellant are
parents, and (sic) Marites Rabino, the owner of the palpably and undoubtedly against morals, good
restaurant where plaintiff was working and where customs, and public policy, and are even gravely and
defendant first proposed marriage to her, also knew deeply derogatory and insulting to our women,
of this love affair and defendant's proposal of coming as they do from a foreigner who has been
marriage to plaintiff, which she declared was the enjoying the hospitality of our people and taking
reason why plaintiff resigned from her job at the advantage of the opportunity to study in one of our
restaurant after she had accepted defendant's proposal institutions of learning, defendant-appellant should
(pp. 6-7, tsn March 7, 1988). indeed be made, under Art. 21 of the Civil Code of
the Philippines, to compensate for the moral damages
 and injury that he had caused plaintiff, as the lower submit their respective Memoranda, which they subsequently
court ordered him to do in its decision in this case. 12 complied with.

Unfazed by his second defeat, petitioner filed the instant petition on As may be gleaned from the foregoing summation of the petitioner's
26 March 1991; he raises therein the single issue of whether or not arguments in support of his thesis, it is clear that questions of fact,
Article 21 of the Civil Code applies to the case at bar. 13 which boil down to the issue of the credibility of witnesses, are also
raised. It is the rule in this jurisdiction that appellate courts will not
It is petitioner's thesis that said Article 21 is not applicable because he disturb the trial court's findings as to the credibility of witnesses, the
had not committed any moral wrong or injury or violated any good latter court having heard the witnesses and having had the opportunity
custom or public policy; he has not professed love or proposed to observe closely their deportment and manner of testifying, unless
marriage to the private respondent; and he has never maltreated her. the trial court had plainly overlooked facts of substance or value
He criticizes the trial court for liberally invoking Filipino customs, which, if considered, might affect the result of the case. 15
traditions and culture, and ignoring the fact that since he is a foreigner,
he is not conversant with such Filipino customs, traditions and culture. Petitioner has miserably failed to convince Us that both the appellate
As an Iranian Moslem, he is not familiar with Catholic and Christian and trial courts had overlooked any fact of substance or values which
ways. He stresses that even if he had made a promise to marry, the could alter the result of the case.
subsequent failure to fulfill the same is excusable or tolerable because
of his Moslem upbringing; he then alludes to the Muslim Code which Equally settled is the rule that only questions of law may be raised in
purportedly allows a Muslim to take four (4) wives and concludes that a petition for review on certiorari under Rule 45 of the Rules of Court.
on the basis thereof, the trial court erred in ruling that he does not It is not the function of this Court to analyze or weigh all over again
posses good moral character. Moreover, his controversial "common the evidence introduced by the parties before the lower court. There
law life" is now his legal wife as their marriage had been solemnized are, however, recognized exceptions to this rule. Thus, in Medina
in civil ceremonies in the Iranian Embassy. As to his unlawful vs. Asistio, Jr., 16 this Court took the time, again, to enumerate these
cohabitation with the private respondent, petitioner claims that even if exceptions:
responsibility could be pinned on him for the live-in relationship, the
private respondent should also be faulted for consenting to an illicit xxx xxx xxx
arrangement. Finally, petitioner asseverates that even if it was to be
assumed arguendo that he had professed his love to the private (1) When the conclusion is a finding grounded
respondent and had also promised to marry her, such acts would not entirely on speculation, surmises or conjectures
be actionable in view of the special circumstances of the case. The (Joaquin v. Navarro, 93 Phil. 257 [1953]); (2) When
mere breach of promise is not actionable. 14 the inference made is manifestly mistaken, absurb or
impossible (Luna v. Linatok, 74 Phil. 15 [1942]); (3)
On 26 August 1991, after the private respondent had filed her Where there is a grave abuse of discretion (Buyco v.
Comment to the petition and the petitioner had filed his Reply thereto, People, 95 Phil. 453 [1955]); (4) When the judgment
this Court gave due course to the petition and required the parties to is based on a misapprehension of facts (Cruz v.
Sosing,
 L-4875, Nov. 27, 1953); (5) When the findings of fact the United States and in England has shown that no
are conflicting (Casica v. Villaseca, L-9590 Ap. 30, other action lends itself more readily to abuse by
1957; unrep.) (6) When the Court of Appeals, in designing women and unscrupulous men. It is this
making its findings, went beyond the issues of the experience which has led to the abolition of rights of
case and the same is contrary to the admissions of action in the so-called Heart Balm suits in many of
both appellate and appellee (Evangelista v. Alto the American states. . . . 19
Surety and Insurance Co., 103 Phil. 401 [1958]);
(7) The findings of the Court of Appeals are contrary This notwithstanding, the said Code contains a provision, Article 21,
to those of the trial court (Garcia v. Court of Appeals, which is designed to expand the concept of torts or quasi-delict in this
33 SCRA 622 [1970]; Sacay v. Sandiganbayan, 142 jurisdiction by granting adequate legal remedy for the untold number
SCRA 593 [1986]); (8) When the findings of fact are of moral wrongs which is impossible for human foresight to
conclusions without citation of specific evidence on specifically enumerate and punish in the statute books. 20
which they are based (Ibid.,); (9) When the facts set
forth in the petition as well as in the petitioners main As the Code Commission itself stated in its Report:
and reply briefs are not disputed by the respondents
(Ibid.,); and (10) The finding of fact of the Court of But the Code Commission had gone farther than the
Appeals is premised on the supposed absence of sphere of wrongs defined or determined by positive
evidence and is contradicted by the evidence on law. Fully sensible that there are countless gaps in the
record (Salazar v. Gutierrez, 33 SCRA 242 [1970]). statutes, which leave so many victims of moral
wrongs helpless, even though they have actually
Petitioner has not endeavored to joint out to Us the existence of any of suffered material and moral injury, the Commission
the above quoted exceptions in this case. Consequently, the factual has deemed it necessary, in the interest of justice, to
findings of the trial and appellate courts must be respected. incorporate in the proposed Civil Code the following
rule:
And now to the legal issue.
Art. 23. Any person who wilfully
The existing rule is that a breach of promise to marry per se is not an causes loss or injury to another in a
actionable wrong. 17 Congress deliberately eliminated from the draft manner that is contrary to morals,
of the New Civil Code the provisions that would have made it so. The good customs or public policy shall
reason therefor is set forth in the report of the Senate Committees on compensate the latter for the damage.
the Proposed Civil Code, from which We quote:
An example will illustrate the purview of the
The elimination of this chapter is proposed. That foregoing norm: "A" seduces the nineteen-year old
breach of promise to marry is not actionable has been daughter of "X". A promise of marriage either has not
definitely decided in the case of De Jesus vs. been made, or can not be proved. The girl becomes
Syquia. 18 The history of breach of promise suits in pregnant. Under the present laws, there is no crime,
 as the girl is above nineteen years of age. Neither can 2176 of the Civil Code. 22 In between these opposite
any civil action for breach of promise of marriage be spectrums are injurious acts which, in the absence of Article
filed. Therefore, though the grievous moral wrong has 21, would have been beyond redress. Thus, Article 21 fills that
been committed, and though the girl and family have vacuum. It is even postulated that together with Articles 19
suffered incalculable moral damage, she and her and 20 of the Civil Code, Article 21 has greatly broadened the
parents cannot bring action for damages. But under scope of the law on civil wrongs; it has become much more
the proposed article, she and her parents would have supple and adaptable than the Anglo-American law on torts. 23
such a right of action.
In the light of the above laudable purpose of Article 21, We are of the
Thus at one stroke, the legislator, if the forgoing rule opinion, and so hold, that where a man's promise to marry is in fact
is approved, would vouchsafe adequate legal remedy the proximate cause of the acceptance of his love by a woman and his
for that untold number of moral wrongs which it is representation to fulfill that promise thereafter becomes the proximate
impossible for human foresight to provide for cause of the giving of herself unto him in a sexual congress, proof that
specifically in the statutes. 21 he had, in reality, no intention of marrying her and that the promise
was only a subtle scheme or deceptive device to entice or inveigle her
Article 2176 of the Civil Code, which defines a quasi-delict thus: to accept him and to obtain her consent to the sexual act, could justify
the award of damages pursuant to Article 21 not because of such
Whoever by act or omission causes damage to promise to marry but because of the fraud and deceit behind it and the
another, there being fault or negligence, is obliged to willful injury to her honor and reputation which followed thereafter.
pay for the damage done. Such fault or negligence, if It is essential, however, that such injury should have been committed
there is no pre-existing contractual relation between in a manner contrary to morals, good customs or public policy.
the parties, is called a quasi-delict and is governed by
the provisions of this Chapter. In the instant case, respondent Court found that it was the petitioner's
"fraudulent and deceptive protestations of love for and promise to
is limited to negligent acts or omissions and excludes the marry plaintiff that made her surrender her virtue and womanhood to
notion of willfulness or intent. Quasi-delict, known in Spanish him and to live with him on the honest and sincere belief that he would
legal treatises as culpa aquiliana, is a civil law concept keep said promise, and it was likewise these fraud and deception on
while torts is an Anglo-American or common law appellant's part that made plaintiff's parents agree to their daughter's
concept. Torts is much broader than culpa aquiliana because living-in with him preparatory to their supposed marriage." 24 In short,
it includes not only negligence, but international criminal acts the private respondent surrendered her virginity, the cherished
as well such as assault and battery, false imprisonment and possession of every single Filipina, not because of lust but because of
deceit. In the general scheme of the Philippine legal system moral seduction — the kind illustrated by the Code Commission in its
envisioned by the Commission responsible for drafting the example earlier adverted to. The petitioner could not be held liable for
New Civil Code, intentional and malicious acts, with certain criminal seduction punished under either Article 337 or Article 338 of
exceptions, are to be governed by the Revised Penal Code the Revised Penal Code because the private respondent was above
while negligent acts or omissions are to be covered by Article eighteen (18) years of age at the time of the seduction.
Prior decisions of this Court clearly suggest that Article 21 may be It has been ruled in the Buenaventura case (supra)
applied in a breach of promise to marry where the woman is a victim that —
of moral seduction. Thus, in Hermosisima vs. Court of Appeals,25 this
Court denied recovery of damages to the woman because: To constitute seduction there must in
all cases be some sufficient promise
. . . we find ourselves unable to say that petitioner or inducement and the woman must
is morally guilty of seduction, not only because he is yield because of the promise or other
approximately ten (10) years younger than the inducement. If she consents merely
complainant — who was around thirty-six (36) years from carnal lust and the intercourse
of age, and as highly enlightened as a former high is from mutual desire, there is no
school teacher and a life insurance agent are supposed seduction (43 Cent. Dig. tit.
to be — when she became intimate with petitioner, Seduction, par. 56) She must be
then a mere apprentice pilot, but, also, because the induced to depart from the path of
court of first instance found that, complainant virtue by the use of some species of
"surrendered herself" to petitioner because, arts, persuasions and wiles, which
"overwhelmed by her love" for him, she "wanted to are calculated to have and do have
bind" him by having a fruit of their engagement even that effect, and which result in her
before they had the benefit of clergy. person to ultimately submitting her
person to the sexual embraces of her
In Tanjanco vs. Court of Appeals, 26 while this Court likewise hinted seducer (27 Phil. 123).
at possible recovery if there had been moral seduction, recovery was
eventually denied because We were not convinced that such seduction And in American Jurisprudence we find:
existed. The following enlightening disquisition and conclusion were
made in the said case: On the other hand, in an action by the
woman, the enticement, persuasion
The Court of Appeals seem to have overlooked that or deception is the essence of the
the example set forth in the Code Commission's injury; and a mere proof of
memorandum refers to a tort upon a minor who had intercourse is insufficient to warrant
been seduced. The essential feature is seduction, that a recovery.
in law is more than mere sexual intercourse, or a
breach of a promise of marriage; it connotes Accordingly it is not seduction where
essentially the idea of deceit, enticement, superior the willingness arises out of sexual
power or abuse of confidence on the part of the desire of curiosity of the female, and
seducer to which the woman has yielded (U.S. vs. the defendant merely affords her the
Buenaventura, 27 Phil. 121; U.S. vs. Arlante, 9 Phil. needed opportunity for the
595). commission of the act. It has been
 emphasized that to allow a recovery . . . if there be criminal or moral seduction, but not if
in all such cases would tend to the the intercourse was due to mutual lust. (Hermosisima
demoralization of the female sex, vs. Court of Appeals,
and would be a reward for unchastity L-14628, Sept. 30, 1960; Estopa vs. Piansay, Jr., L-
by which a class of adventuresses 14733, Sept. 30, 1960; Batarra vs. Marcos, 7 Phil. 56
would be swift to profit. (47 Am. Jur. (sic); Beatriz Galang vs. Court of Appeals, et al., L-
662) 17248, Jan. 29, 1962). (In other words, if the CAUSE
be the promise to marry, and the EFFECT be the
xxx xxx xxx carnal knowledge, there is a chance that there
was criminal or moral seduction, hence recovery of
Over and above the partisan allegations, the fact stand moral damages will prosper. If it be the other way
out that for one whole year, from 1958 to 1959, the around, there can be no recovery of moral damages,
plaintiff-appellee, a woman of adult age, maintain because here mutual lust has intervened). . . .
intimate sexual relations with appellant, with repeated
acts of intercourse. Such conduct is incompatible with together with "ACTUAL damages, should there be any, such
the idea of seduction. Plainly there is here as the expenses for the wedding presentations (See
voluntariness and mutual passion; for had the Domalagon v. Bolifer, 33 Phil. 471).
appellant been deceived, had she surrendered
exclusively because of the deceit, artful persuasions Senator Arturo M. Tolentino 29 is also of the same persuasion:
and wiles of the defendant, she would not have again
yielded to his embraces, much less for one year, It is submitted that the rule in Batarra
without exacting early fulfillment of the alleged vs. Marcos, 30 still subsists, notwithstanding the
promises of marriage, and would have cut short all incorporation of the present article31 in the Code. The
sexual relations upon finding that defendant did not example given by the Code Commission is correct, if
intend to fulfill his defendant did not intend to fulfill there was seduction, not necessarily in the legal sense,
his promise. Hence, we conclude that no case is made but in the vulgar sense of deception. But when the
under article 21 of the Civil Code, and no other cause sexual act is accomplished without any deceit or
of action being alleged, no error was committed by qualifying circumstance of abuse of authority or
the Court of First Instance in dismissing the influence, but the woman, already of age, has
complaint. 27 knowingly given herself to a man, it cannot be said
that there is an injury which can be the basis for
In his annotations on the Civil Code, 28 Associate Justice Edgardo L. indemnity.
Paras, who recently retired from this Court, opined that in a breach of
promise to marry where there had been carnal knowledge, moral But so long as there is fraud, which is characterized
damages may be recovered: by willfulness (sic), the action lies. The court,
however, must weigh the degree of fraud, if it is
 sufficient to deceive the woman under the he was not at all moved by good faith and an honest motive. Marrying
circumstances, because an act which would deceive a with a woman so circumstances could not have even remotely
girl sixteen years of age may not constitute deceit as occurred to him. Thus, his profession of love and promise to marry
to an experienced woman thirty years of age. But so were empty words directly intended to fool, dupe, entice, beguile and
long as there is a wrongful act and a resulting injury, deceive the poor woman into believing that indeed, he loved her and
there should be civil liability, even if the act is not would want her to be his life's partner. His was nothing but pure lust
punishable under the criminal law and there should which he wanted satisfied by a Filipina who honestly believed that by
have been an acquittal or dismissal of the criminal accepting his proffer of love and proposal of marriage, she would be
case for that reason. able to enjoy a life of ease and security. Petitioner clearly violated the
Filipino's concept of morality and brazenly defied the traditional
We are unable to agree with the petitioner's alternative proposition to respect Filipinos have for their women. It can even be said that the
the effect that granting, for argument's sake, that he did promise to petitioner committed such deplorable acts in blatant disregard of
marry the private respondent, the latter is nevertheless also at fault. Article 19 of the Civil Code which directs every person to act with
According to him, both parties are in pari delicto; hence, pursuant to justice, give everyone his due and observe honesty and good faith in
Article 1412(1) of the Civil Code and the doctrine laid down the exercise of his rights and in the performance of his obligations.
in Batarra vs. Marcos, 32 the private respondent cannot recover
damages from the petitioner. The latter even goes as far as stating that No foreigner must be allowed to make a mockery of our laws, customs
if the private respondent had "sustained any injury or damage in their and traditions.
relationship, it is primarily because of her own doing, 33 for:
The pari delicto rule does not apply in this case for while indeed, the
. . . She is also interested in the petitioner as the latter private respondent may not have been impelled by the purest of
will become a doctor sooner or later. Take notice that intentions, she eventually submitted to the petitioner in sexual
she is a plain high school graduate and a mere congress not out of lust, but because of moral seduction. In fact, it is
employee . . . (Annex "C") or a waitress (TSN, p. 51, apparent that she had qualms of conscience about the entire episode
January 25, 1988) in a luncheonette and without for as soon as she found out that the petitioner was not going to marry
doubt, is in need of a man who can give her economic her after all, she left him. She is not, therefore, in pari delicto with the
security. Her family is in dire need of financial petitioner. Pari delicto means "in equal fault; in a similar offense or
assistance. (TSN, pp. 51-53, May 18, 1988). And this crime; equal in guilt or in legal fault." 35 At most, it could be conceded
predicament prompted her to accept a proposition that that she is merely in delicto.
may have been offered by the petitioner. 34
Equity often interferes for the relief of the less guilty
These statements reveal the true character and motive of the petitioner. of the parties, where his transgression has been
It is clear that he harbors a condescending, if not sarcastic, regard for brought about by the imposition of undue influence of
the private respondent on account of the latter's ignoble birth, inferior the party on whom the burden of the original wrong
educational background, poverty and, as perceived by him, principally rests, or where his consent to the
dishonorable employment. Obviously then, from the very beginning,
 transaction was itself procured by
fraud. 36

In Mangayao vs. Lasud, 37 We declared:

Appellants likewise stress that both parties being at

fault, there should be no action by one against the
other (Art. 1412, New Civil Code). This rule,
however, has been interpreted as applicable only
where the fault on both sides is, more or less,
equivalent. It does not apply where one party is
literate or intelligent and the other one is not. (c.f.
Bough vs. Cantiveros, 40 Phil. 209).

We should stress, however, that while We find for the private

respondent, let it not be said that this Court condones the deplorable
behavior of her parents in letting her and the petitioner stay together
in the same room in their house after giving approval to their marriage.
It is the solemn duty of parents to protect the honor of their daughters
and infuse upon them the higher values of morality and dignity.

WHEREFORE, finding no reversible error in the challenged decision,

the instant petition is hereby DENIED, with costs against the
petitioner.

SO ORDERED.
G.R. No. 79184 May 6, 1992 10. During the time or period while respondent is the
legal counsel of the aforecited corporation, there
ERLINDA L. PONCE, petitioner, occurred certain fraudulent manipulations,
vs. anomalous management and prejudicial operations by
VALENTINO L. LEGASPI and THE HON. COURT OF certain officers of said corporation, namely: Edward
APPEALS, respondents. J. Porter, President/General Manager; Norma Y.
Porter, Secretary; and Zenaida T. Manaloto, Director,
F.S. Farolan & Associates Law Offices for petitioner. who caused great damage and prejudice which will be
related hereunder;

xxx xxx xxx

GUTIERREZ, JR., J.:
14. About July, 1976, said spouses Edward J. Porter
This controversy calls for the balancing of two conflicting interests: and Norma Y. Porter, together with Zenaida T.
the petitioner's right to litigate versus the respondent's right to be Manaloto, facilitated, assisted and aided by herein
protected from malicious prosecution. respondent Legaspi (Annexes "B" and "B-1"
herewith), incorporated the Yrasport Drydocks, Inc.,
The present case stemmed from the filing before the Supreme Court hereinafter designated YRASPORT, which they
on October 3, 1977 of a complaint for disbarment against respondent control with the following stockholdings:
Atty. Valentino Legaspi by petitioner Erlinda Ponce.
Edward J. Porter 180 shares
At the time of the filing of the disbarment proceedings, petitioner Norma Y. Porter 180 shares
Ponce, together with her husband Manuel, owned forty three percent Eriberto F. Yrastorza 16 shares
Zenaida T. Manaloto 8 shares
(43%) of the stockholdings of L'NOR Marine Services, Inc. (L'NOR).
She was then Treasurer and director of the Board of Directors of Roman M. Maceda 8 shares
L'NOR while her husband was a director. Forty eight percent (48%) Andres A. Nombrado 8 shares
of L'NOR's stocks was owned by the spouses Edward and Norma
Porter who were then serving as President/General Manager and and whose line of business is in direct competition
Secretary respectively. with L'NOR;

The pertinent portions of the complaint are reproduced below: 15. YRASPORT, like Yrasport Enterprises, was
launched without the knowledge of the minority
xxx xxx xxx stockholders owning 43% of L'NOR, and was really
designed to compete, if not eliminate, L'NOR as a
competitor;
16. That as a matter of fact attempts were made to 23. On account of the aforecited flagrant fraud, a
secure one of L'NOR jobs in favor of YRASPORT, charge of Estafa was filed against Edward J. Porter
which fraudulent scheme was however frustrated and the office of the City Fiscal handed down a
only by the timely opposition of herein complainant; resolution to prosecute him in court, copy of pertinent
exhibits herewith marked as Annexes "C", "C-1", "C-
17. YRASPORT likewise availed of and used the 2", "C-3", "C-4" and "C-5";
office space, equipment, personnel, funds, other
physical facilities, and goodwill of L'NOR while 24. In view of the aforesaid illegal manipulations,
competing at the same time against and causing the illicit schemes, palpable frauds and estafa committed
latter great damage and irreparable injury; by said President-General Manager Edward J. Porter,
in confabulation and conspiracy with the other
xxx xxx xxx officers of the corporation, namely: his wife Norma
Y. Porter and Zenaida T. Manaloto, herein
21. Edward J. Porter, President-General Manager of complainant requested respondent Valentino Legaspi
L'NOR, purchased from ISECOR (Industrial Supply to take and pursue appropriate local steps and
Corporation) on November 3, 1974 one skaagit winch seasonable actions in order to protect the paramount
with its cables for P10,000.00; that on November 18, interest of L'NOR of which he is the legal counsel by
1974 said Edward J. Porter assigned the purchase of retainer, but the latter, without any valid excuse
said skaagit winch with its cables in favor of L'NOR whatsoever, refused to do so, although he is still
at the price of P10,000.00; and that the latter collecting his monthly retainer;
corporation then assumed the agreed obligation
covering the P10,000.00 purchase price in favor of 25. On account of the refusal of said corporate
ISECOR; attorney of L'NOR, respondent Legaspi, complainant
was forced to retain the services of another counsel to
22. Subsequently, on or about October 18, 1975, said prosecute the appropriate derivative suit in the Court
President-General Manager Edward J. Porter of First Instance of Cebu, copy herewith marked
misrepresented facts regarding the acquisition cost of Annex "D"; and that, in opposition to the same,
said skaagit winch with its cables to the effect that the respondent Legaspi appeared as legal counsel and
same was sold by ISECOR at the cost of P20,000.00; attorney of Edward J. Porter and his confederates,
that he collected the sum from L'NOR for direct copy of exhibits marked Annex "D-1" herewith;
payment to ISECOR allegedly to liquidate in full the
obligation of P20,000.00 in favor of ISECOR, when, 26. In the Criminal Case filed against Edward J.
in truth and in fact, the obligation is only P10,000.00 Porter for Estafa (Annex "C" supra), respondent
and not more; Legaspi likewise appeared as counsel for respondent
Porter despite the fact that he is the legal counsel of
L'NOR which is the prejudiced party and for whose
benefit the criminal case was really being prosecuted, officers of L'NOR against the interest of the latter and
copy of letter of respondent, marked as Annex "C-6" to further the malicious competitive sabotage of
herewith; YRASPORT alleged heretofore; and

27. Up to the present time respondent is still 30. That, upon the foregoing, we most respectfully
collecting his monthly retainer, and for his prefer against respondent Valentino Legaspi the
appearance for Edward J. Porter, et. als. in the following charges:
derivative suit, he collected the sum of P2,000.00
from L'NOR as payment for his illicit legal services First Specification:
in defending the Porters and Manaloto against the
very interest of the corporation paying him monthly That respondent Valentino Legaspi has committed
retainer; gross misconduct in office as a practicing lawyer and
member of the Philippine Bar, because, as legal
28. Said Edward J. Porter and his confederates, in counsel, he violated his duty to and the trust of his
their respective capacity as such officers of L'NOR, client, L'NOR Marine Services, Inc., whom he is
continue and persist in perpetrating malicious acts, professionally duty bound to represent with entire
anomalous management and fraudulent operations devotion faithfully as such attorney, and whose
against the interest of L'NOR, and that respondent paramount interest he should protect in all good faith
Legaspi was duly adviced verbally and also in writing with absolute fidelity, but that, in truth and in fact, he
by complainant to take the necessary action in his did not do so.
capacity as legal counsel of L'NOR to protect
zealously the interest of the latter, but respondent Second Specification:
Legaspi has done absolutely nothing, and grossly
neglected and flagrantly violated his duties as legal That respondent Valentino Legaspi, while acting as
counsel up to the present time, pertinent exhibits legal counsel of L'NOR under continuing monthly
herewith marked as Annexes "E", "E-1", "E-2", "E- retainer, has acted at the same time as lawyer of
4", "E-5", "E-6"; Edward J. Porter, et. als., who have committed
anomalous acts, prejudicial manipulations and grave
29. That, on the contrary, respondent Legaspi in his frauds against his client L'NOR Marine services, Inc.,
dual capacity as legal counsel of L'NOR and that he therefore represented professionally
YRASPORT, and at the same time acting in his conflicting interest; and that he committed grave
capacity as corporate secretary of YRASPORT, malpractice that is in flagrant violation of the
facilitated, assisted, aided or otherwise abetted the recognized canons of legal ethics.
illegal manipulations, illicit schemes, fraudulent
operations and grave frauds committed by said Third Specification:
Edward J. Porter and his confederates who are
 That respondent Valentino Legaspi committed On January 23, 1978, the Court issued a resolution dismissing the
grossly corrupt or dishonest conduct while under disbarment complaint against Legaspi. The resolution is quoted
retainer and acting as attorney of L'NOR Marine hereunder:
Services, Inc., when he facilitated, assisted, aided or
otherwise abetted the organization, registration and Administrative Case No. 1819 (Erlinda L. Ponce v.
operation of another competing entity, Yrasport Valentino L. Legaspi). –– Considering the complaint
Drydocks, Inc., in which he is also the lawyer and for disbarment against Atty. Valentino L. Legaspi as
corporate Secretary, at the expense of and to which well as said respondent's comment thereon, the Court
the business and transactions of L'NOR are being Resolved to DISMISS the complaint for lack of merit.
diverted or otherwise appropriated, including the (Records, Administrative Case No. 1819 p. 91)
pirating of skilled personnel and also facilities, and
that respondent committed the same with evident bad The petitioner filed a motion for reconsideration which was denied by
faith and absolute lack of fidelity to his client L'NOR, the Court on March 31, 1978.
thereby degrading the good esteem, integrity and
honor of the profession. (Records, Administrative On February 10, 1978, Atty. Legaspi filed before the Court of First
Case No. 1819, pp. 4-13) Instance (now Regional Trial Court of Cebu) a complaint for damages
against the petitioner.
In his comment, Atty. Legaspi denied the allegations in paragraphs 10,
21, 22, 23, 24, 28, 29 and 30. He qualifiedly admitted the allegations The petitioner filed a motion to dismiss which was denied by the trial
in paragraphs 14 and 15, stating that Yrasport was not organized to court.
compete directly with L'NOR. He averred that L'NOR could not cope
up with the business and Yrasport was formed for the purpose of On July 18, 1983, the lower court rendered judgment the dispositive
complementing L'NOR's business. He added that there is nothing in
portion of which reads as follows:
the law nor contract which prohibits a stockholder from competing
with the business of the corporation.
WHEREFORE, this court being satisfied that the
material allegations of the complaint have been
Atty. Legaspi admitted the allegations in paragraphs 26 and 27 that he proved and remained uncontradicted with the
appeared for Edward Porter in the estafa case filet against the latter,
testimonial and documentary evidence introduced
reasoning that his appearances were direct orders of management and and admitted by the court, judgment is hereby
that it was not improper for counsel to represent both the corporate rendered in favor of the plaintiff and against the
officers when they are being sued at the same time. defendant Erlinda L. Ponce ordering the defendant to
pay Valentino L. Legaspi, plaintiff herein, the amount
As to the allegations in paragraphs 16 and 17, Atty. Legaspi declared of P1,000.00 as actual damages, P50,000.00 as moral
that he has no sufficient knowledge to form a belief as to the truth or damages and P25,000.00 as exemplary damages and
falsity of the statements contained therein. to pay the costs. (Rollo, p. 115)
The petitioner appealed to the Court of Appeals. On May 26, 1987, his act of filing infringes upon the rights of others. In
the Court of Appeals affirmed the lower court's judgment. In affirming the same way that although freedom of speech is
the appealed decision, the Court of Appeals reasoned: guaranteed, one cannot claim to be protected under
such freedom when he is being held liable for the libel
Defendant-appellant contends that plaintiff-appellee's he commits.
action for damages is purely retaliatory in character
and stems from an alleged feeling of wounded pride The case at bar cannot be considered as one for
or amor proprio; that granting without admitting that recovery of damages arising from malicious
the appellee has suffered certain adverse effects in his prosecution, for a disbarment proceeding is not a
reputation because of the disbarment case, it does not criminal action. (De Jesus-Paras v. Vailoces, 111
constitute malicious prosecution as would otherwise Phil. 569; 1 SCRA 954, 957). However, we should
perhaps render the appellant liable for damages; that not lose sight of the fact that utterances made in the
the facts on record indubitably show that the appellant course of judicial proceedings, including all kinds of
was merely exercising her right of access to courts for pleadings, petitions and motions, belong to the class
redress of legitimate grievances when she filed the of communications that are absolutely privileged.
disbarment case believing then as she still does, that (Sison v. David, 110 Phil. 662; 1 SCRA 60, 71 citing
appellee committed a breach of his professional authorities) and no civil action for libel or slander
duties as a lawyer. In refutation, appellee alleges that may arise therefrom unless the contents of the petition
appellant belittles this action for damages as "purely are irrelevant to the subject matter thereof. (1 SCRA
retaliatory in character and stems from an alleged 71). It has also been held that a privileged
feeling of wounded pride or amor proprio"; that by communication should not be subjected to
such statement, appellant has unmasked herself as to microscopic examination to discover grounds of
how little regard she has for the feelings of others and malice or falsity. Such excessive scrutiny would
how she clings to the law if only to secure her defeat the protection which the law throws over
purpose; that what is being sought by appellee is privileged communications. The ultimate test is that
compensation for appellee's malice, falsehoods and of bona fides. (Deles v. Aragona, Jr., 27 SCRA 633,
deceit in trying to destroy the professional standing of 642). The privileged character of her complaint filed
a humble practitioner just because he did better than with the Supreme Court must have been what
the other. defendant had in mind when she invokes her right to
free access to the courts. However, defendant's
While free access to the courts is guaranteed under actuations before and after the filing of administrative
Section 9, Article IV of the 1973 Constitution (now complaint with the Supreme Court disprove her bona
Section 11, Article III of the 1986 Constitution), it fides. On this issue, the trial court found:
does not give unbridled license to file any case,
whatever the motives are. Whoever files a case shall Yet, the uncontroverted evidence
be responsible for the consequences thereof whenever before the court belie these
allegations because there are which plaintiff ably defended
antecedent incidents between causing their eventual dismissal and
plaintiff and defendant that speak other acts against plaintiff which
otherwise; that she filed this demonstrated palpably defendant's
disbarment complaint against hatred for the plaintiff acts clearly
plaintiff with malice aforethought. evidencing malice contrary to her
This conclusion is founded on the averments in the Answer.
fact that defendant was embittered
against him for failing to obtain a To top it all, notwithstanding her
compromise against Eduardo evident support and advice by
Coronel before the military due to counsel, she cleverly hid the identity
plaintiff's defense of his client; that of said counsel prosecuting all her
she wanted to dissolve the L'Nor acts of vilification and harassment in
Corporation in order to repossess the her own name. Furthermore, the
premises leased to the former upon testimony of plaintiff that she
the corporation's dissolution and distributed copies of her complaint
Porter's ouster which was thwarted for disbarment against plaintiff to his
by plaintiff's advice as counsel for clients remain uncontradicted.
L'Nor; plaintiff's letter (Exhibit "H") Finally, instead of coming to court in
that she was not authorized to use the good faith she instead moved from
title of Chairman of the Board; not her residence at Seaview Heights,
counter-signing plaintiff's check Lawaan, Talisay, Cebu without
(Exhibits I, I-1, and I-2); her informing the court nor her counsel
insistence to have the surplus profits and has not been heard from. From
declared as cash dividend which the foregoing, malice is evident.
likewise failed due to plaintiff's
advice; her letter (Exh. J) asking Appellant claims that the finding of the lower court
plaintiff to desist from defending the that appellant disseminated information regarding the
corporation and its officers; filing of her complaint for disbarment and caused a
plaintiff's refusal to give her advice copy of the same to be furnished appellee's clients is
without authority from the Board of totally unsupported by any evidence on record. The
Directors; numerous cases filed with contention is untenable. Plaintiff declared that he
the Security and Exchange came to know of the complaint against him even
Commission which were all before the Supreme Court required him to comment
dismissed and with the Court of First because two or three of his clients told him that they
Instance and Circuit Criminal Court had a copy given to them. (p. 8, t.s.n., June 3, 1983).
The foregoing acts committed by the defendant The petitioner's motion for reconsideration was denied by the
violate the conduct that she should have observed in respondent Court in its resolution dated July 7, 1987. Hence, this
her relation to plaintiff, as provided in the following petition.
provisions of the Civil Code of the Philippines, to wit:
The petitioner assigns the following errors:
Art. 19. Every person must, in the exercise of his
rights and in the performance of his duties, act with I
justice, give everyone his due, and observe honesty
and good faith. THE RESPONDENT COURT OF APPEALS
ERRED IN AFFIRMING THE DECISION OF THE
Art. 20. Every person who, contrary to law, wilfully REGIONAL TRIAL COURT OF CEBU, BRANCH
or negligently causes damage to another, shall XXI, WHICH FOUND THE HEREIN PETITIONER
indemnify the latter for the same. GUILTY OF BAD FAITH IN INSTITUTING A
COMPLAINT FOR DISBARMENT AGAINST
Art. 26. Every person shall respect the dignity, THE PRIVATE RESPONDENT.
personality, privacy and peace of mind of his
neighbors and other persons. The following and II
similar acts, though they may not constitute a criminal
offense, shall produce a cause of action for damages, THE RESPONDENT COURT OF APPEALS
prevention and other relief; ERRED IN ORDERING THE PETITIONER TO
PAY THE PRIVATE RESPONDENT ACTUAL,
(1) Prying into the privacy of another's residence; MORAL AND EXEMPLARY DAMAGES TO PAY
THE COSTS. (Rollo, p. 21)
(2) Meddling with or disturbing the private life or
family relations of another; Before proceeding with the merits of the case, the scope of an action
for damages arising from malicious prosecution needs to be clarified.
(3) Intriguing to cause another to be alienated from Both the Court of Appeals and the petitioner are of the belief that the
his friends; suit for damages filed by Atty. Legaspi is not one arising from
malicious prosecution because "a disbarment proceeding is not a
(4) Vexing or humiliating another on account of his criminal action. (De Jesus-Paras v. Vailoces, 1 SCRA 954 [1961])."
religious beliefs, lowly station in life, place of birth, The obvious inference is that only an unsuccessful criminal action may
physical defect, or other personal condition. (Rollo, subsequently give rise to a claim for damages based on malicious
pp. 45-48) prosecution. This is not correct. While generally, malicious
prosecution refers to unfounded criminal actions and has been
expanded to include unfounded civil suits just to vex and humiliate the
defendant despite the absence of a cause of action or probable cause
(Equitable Banking Corporation v. Intermediate Appellate Court, 133 xxx xxx xxx
SCRA 138 [1984]) the foundation of an action for malicious
prosecution is an original proceeding, judicial in character. (Lorber v. (8) Malicious prosecution.
Storrow, 70 P. 2d 513 [1937]; Shigeru Hayashida v. Tsunehachi
Kakimoto, 23 P. 2d 311 [1933]; Graves v. Rudman, 257 N.Y.S. 212 In order, however, for the malicious prosecution suit to prosper, the
[1932]). A disbarment proceeding is, without doubt, judicial in plaintiff must prove: (1) the fact of the prosecution and the further fact
character and therefore may be the basis for a subsequent action for that the defendant was himself the prosecutor, and that the action
malicious prosecution. finally terminated with an acquittal; (2) that in bringing the action, the
prosecutor acted without probable cause; and (3) that the prosecutor
A perusal of the allegations in Atty. Legaspi's complaint for damages, was actuated or impelled by legal malice, that is by improper or
particularly paragraphs 10, 11, 12 and 15 thereof (Rollo, pp. 56-59) sinister motive. (Lao v. Court of Appeals, 199 SCRA 58 [1991];
shows that his main cause of action was predicated on injury resulting Rehabilitation Finance Corporation v. Kohl, 4 SCRA 535 [1962];
from the institution of the disbarment case against him. This being the Buchanan v. Viuda de Esteban, 32 Phil. 363 [1915]).
case, we find that the suit filed by the respondent lawyer makes out a
case of damages for malicious prosecution. The foregoing requisites are necessary safeguards to preserve a
person's right to litigate which may otherwise be emasculated by the
An action for damages arising from malicious prosecution is anchored undue filing of malicious prosecution cases. Thus, as further held in
on the provisions of Article 21, 2217 and 2219 [8] of the New Civil the aforecited case of Buchanan v. Viuda. de Esteban, supra: "Malice
Code. Under these Articles: is essential to the maintenance of an action for malicious prosecution
and not merely to the recovery of exemplary damages. But malice
Art. 21. Any person who wilfully causes loss or injury alone does not make one liable for malicious prosecution, where
to another in a manner that is contrary to morals, good probable cause is shown, even where it appears that the suit was
customs or public policy shall compensate the latter brought for the mere purpose of vexing, harassing and injuring his
for damages. adversary. In other words, malice and want of probable cause must
both exist in order to justify the action." (Emphasis supplied; see also
Art. 2217. Moral damages include physical suffering, Rehabilitation Finance Corp. v. Koh, supra)
mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social Probable cause is the existence of such facts and circumstances as
humiliation and similar injury. Though incapable of would excite the belief, in a reasonable mind, acting on the facts within
pecuniary computation, moral damages may be the knowledge of the prosecutor, that the person charged was guilty of
recovered if they are the proximate result of the the crime (or in this case, the wrongdoing) for which he was
defendant's wrongful act or omission. prosecuted. (See Buchanan v. Viuda de Esteban, supra)

Art. 2219. Moral damages may be recovered in the The general rule is well settled that one cannot be held liable in
following and analogous cases: damages for maliciously instituting a prosecution where he acted with
probable cause. In other words, a suit will lie only in cases where a
legal prosecution has been carried on without probable cause. (Id.; We take exception to the respondent's comment that, assuming the
emphasis supplied) petitioner's accusation to be true, "there is nothing in Philippine law
which considers as unethical the formation of competitive
The petitioner, at the time of her filing of the administrative complaint corporations and neither can it be considered with evident bad faith
against the respondent, held substantial stockholdings in L'NOR. She and absolute lack of fidelity." (Records, Administrative Case No.
believed that L'NOR was defrauded by its President/General Manager, 1819, p. 69)
Edward Porter, and filed a complaint for estafa against the latter.
Porter was convicted by the trial court but, upon appeal, was acquitted The circumstances of the case do not depict a simple case of formation
by the appellate court. of competitive corporations. What the petitioner objects to is the fact
that both the respondent lawyer and Porter are fiduciaries of L'NOr
Respondent did not deny that he represented Porter during the and are at the same time fiduciaries of YRASPORT, both of which are
preliminary investigation and trial of the criminal case. In his engaged in the same line of business.
comment in the disbarment complaint against him, he justified his
action by saying that they were "direct orders of management" and True, at that time, the Corporation Law did not prohibit a director or
that there is "nothing improper for counsel to represent both the any other person occupying a fiduciary position in the corporate
corporation and corporate officers at the same time they are being hierarchy from engaging in a venture which competed with that of the
sued." (Records, Administrative Case No. 1819, p. 64) corporation. But as a lawyer, Atty. Legaspi should have known that
while some acts may appear to be permitted through sheer lack of
It is of no moment now that Porter was acquitted of the estafa charge. statutory prohibition, these acts are nevertheless circumscribed upon
Apparently, at that time, petitioner Ponce saw a conflict of interest ethical and moral considerations. And had Atty. Legaspi turned to
situation. To her mind, the act of the respondent in appearing as American jurisprudence which then, as now, wielded a persuasive
counsel for Porter, who had allegedly swindled L'NOR, the interest of influence on our law on corporations, he would have known that it was
which he was duty bound to protect by virtue of the retainer contract, unfair for him or for Porter, acting as fiduciary, to take advantage of
constituted grave misconduct and gross malpractice. an opportunity when the interest of the corporation justly calls for
protection. (See Ballantine, Corporations, 204, Callaghan & Co., N.
Atty. Legaspi did not deny that he aided the Porters in facilitating the Y. [1946])
incorporation of YRASPORT and that he himself was its corporate
secretary. He emphasized, though, that due to L'NOR'S limited Parenthetically, this lapse in the old Corporation Law is now cured by
capitalization, YRASPORT was organized to complement L'NOR'S sections 31 and 34 of the Corporation Code which provide:
business and not to compete with the latter's undertakings.
Sec. 31. Liability of directors, trustees or officers. —
Since the petitioner, however, was of the honest perception that Directors or trustees who willfully and knowingly
YRASPORT was actually organized to appropriate for itself some of vote for or assent to patently unlawful acts of the
L'NOR's business, then we find that she had probable cause to file the corporation or who are guilty of gross negligence or
disbarment suit. bad faith in directing the affairs of the corporation or
acquire any personal or pecuniary interest in conflict
 with their duty as such directors or trustees shall he issue being whether or not the petitioner had probable cause in filing
liable jointly and severally for all damages resulting the complaint.
therefrom suffered by the corporation, its
stockholders or members and other persons. The above discussion should not be construed as a re-opening of the
disbarment proceeding against Atty. Legaspi. References to the
When a director, trustee or officer attempts to acquire complaint for disbarment and the respondent's comment thereto are
or acquires, in violation of his duty, any interest made only for the purpose of determining the existence of probable
adverse to the corporation in respect of any matter cause.
which has been reposed in him in confidence, as to
which equity imposes a disability upon him to deal in Since we adjudge that petitioner Ponce was moved by probable cause,
his own behalf, he shall be liable as a trustee for the we need not anymore ascertain whether or not the petitioner acted with
corporation and must account for the profits which malice in filing the complaint. The existence of probable cause alone,
otherwise have accrued to the corporation. regardless of considerations of malice, is sufficient to defeat the
charge of malicious prosecution.
Sec. 34. Disloyalty of a director. — Where a director,
by virtue of his office, acquires for himself a business The respondent court treated Atty. Legaspi's complaint as one for
opportunity which should belong to the corporation, damages arising from libel and applied the test of bona fides, citing
thereby obtaining profits to the prejudice of such the case of Deles v. Aragona (27 SCRA 633 [1969]). This is incorrect.
corporation, he must account to the latter for all such
profits by refunding the same, unless his act has been In the first place, allegations and averments in pleadings are absolutely
ratified by a vote of the stockholders owning or privileged as long as they are relevant or pertinent to the issues (See
representing at least two-thirds (2/3) of the Montenegro v. Medina, 73 Phil. 602 [1942]). The test of good faith
outstanding capital stock. This provision shall be applies only to a qualified privileged communication. Had the
applicable, notwithstanding the fact that the director respondent court studied the Deles case more closely, it would have
risked his own funds in the venture. traced the "bona fides" test to the case of U.S. v. Bustos, (37 Phil. 731
[1918]). In the latter case, the Court was referring to a qualified
The Court finds it unnecessary to discuss all the other charges imputed privileged communication when it formulated the "bona fides" test.
to the respondent lawyer in the disbarment complaint. From the
foregoing discussion, we have sufficient basis to declare that the Moreover, the test to break through the protective barrier of an
petitioner had probable cause in filing the administrative case against absolutely privileged communication is not "bona fides" but
Atty. Legaspi. Facts and circumstances existed which excited belief in relevance. In the present case, Atty. Legaspi's complaint nowhere
Mrs. Ponce's mind that the respondent indeed committed unethical alleged that the statements made by the petitioner were irrelevant.
acts which warranted the imposition of administrative sanctions. Thus, we find that the petitioner's complaint for disbarment is still
Whether or not the petitioner's perception of these facts and covered by the privilege and may not be the basis of a damage suit
circumstances is actually correct is irrelevant to our inquiry, the only arising from libel.
We disagree with the findings of the two lower courts that it was the
petitioner who distributed copies of the complaint for disbarment to
Atty. Legaspi's clients. It should be noted that Atty. Legaspi did not
even present these alleged clients in court to testify to the source of
these copies. Considering that a complaint for disbarment becomes of
public record once it is filed with the Court, then the petitioner may
not be pinpointed as the sole and indisputable source of the copies
received by the respondent's clients.

Atty. Legaspi may have suffered injury as a consequence of the

disbarment proceedings. But the adverse result of an action does
not per se make the action wrongful and subject the actor to make
payment of damages for the law could not have meant to impose a
penalty on the right to litigate (Saba v. Court of Appeals, 189 SCRA
50 [1990], citing Rubio v. Court of Appeals, 141 SCRA 488 [1986];
see also Salao v. Salao, 70 SCRA 65 [1976] and Ramos v. Ramos, 61
SCRA 284 [1974], citing Barreto v. Arevalo, 99 Phil. 771 [1956]).
One who exercises his rights does no injury. (Saba v. Court of
Appeals, supra, citing Auyong Hian v. Court of Tax Appeals, 59
SCRA 110 [1974]). If damage results from a person's exercising his
legal rights, it is damnum absque injuria. [Id.]

WHEREFORE, the petition is hereby GRANTED. The decision of the

respondent Court of Appeals is SET ASIDE and REVERSED.

SO ORDERED.
G.R. No. 180764 January 19, 2010 Petitioner Villanueva, Valera, and the Secretary of Finance challenged
the injunction order before the Court of Appeals (CA) in CA-G.R. SP
TITUS B. VILLANUEVA, Petitioner, 66070. On September 14, 2001 the CA issued its own TRO, enjoining
vs. the implementation of the RTC’s injunction order. But the TRO lapsed
EMMA M. ROSQUETA, Respondent. after 60 days and the CA eventually dismissed the petition before it.

DECISION On November 22, 2001 while the preliminary injunction in the quo
warranto case was again in force, petitioner Villanueva issued
ABAD, J.: Customs Memorandum Order 40-2001, authorizing Valera to exercise
the powers and functions of the Deputy Commissioner.
This case is about the right to recover damages for alleged abuse of
right committed by a superior public officer in preventing a During the Bureau’s celebration of its centennial anniversary in
subordinate from doing her assigned task and being officially February 2002, its special Panorama magazine edition featured all the
recognized for it. customs deputy commissioners, except respondent Rosqueta. The
souvenir program, authorized by the Bureau’s Steering Committee
The Facts and the Case headed by petitioner Villanueva to be issued on the occasion, had a
space where Rosqueta’s picture was supposed to be but it instead
Respondent Emma M. Rosqueta (Rosqueta), formerly Deputy stated that her position was "under litigation." Meanwhile, the
Commissioner of the Revenue Collection and Monitoring Group of commemorative billboard displayed at the Bureau’s main gate
the Bureau of Customs (the Bureau), tendered her courtesy resignation included Valera’s picture but not Rosqueta’s.
from that post on January 23, 2001, shortly after President Gloria
Macapagal-Arroyo assumed office. But five months later on June 5, On February 28, 2002 respondent Rosqueta filed a complaint 5 for
2001, she withdrew her resignation, claiming that she enjoyed security damages before the RTC of Quezon City against petitioner Villanueva
of tenure and that she had resigned against her will on orders of her in Civil Case Q-02-46256, alleging that the latter maliciously
superior.1 excluded her from the centennial anniversary memorabilia. Further,
she claimed that he prevented her from performing her duties as
Meantime, on July 13, 2001 President Arroyo appointed Gil Valera Deputy Commissioner, withheld her salaries, and refused to act on her
(Valera) to respondent Rosqueta’s position. Challenging such leave applications. Thus, she asked the RTC to award her
appointment, Rosqueta filed a petition for prohibition, quo warranto, ₱1,000,000.00 in moral damages, ₱500,000.00 in exemplary damages,
and injunction against petitioner Titus B. Villanueva (Villanueva), and ₱300,000.00 in attorney’s fees and costs of suit.
then Commissioner of Customs, the Secretary of Finance, and Valera
with the Regional Trial Court2 (RTC) of Manila in Civil Case 01- But the RTC dismissed6 respondent Rosqueta’s complaint, stating that
101539. On August 27, 2001 the RTC issued a temporary restraining petitioner Villanueva committed no wrong and incurred no omission
order (TRO), enjoining Villanueva and the Finance Secretary3 from that entitled her to damages. The RTC found that Villanueva had
implementing Valera’s appointment. On August 28, 2001 the trial validly and legally replaced her as Deputy Commissioner seven
court superseded the TRO with a writ of preliminary injunction. 4 months before the Bureau’s centennial anniversary.
But the CA reversed the RTC’s decision, 7 holding instead that held the position merely in a temporary capacity and since she lacked
petitioner Villanueva’s refusal to comply with the preliminary the Career Executive Service eligibility required for the job.
injunction order issued in the quo warranto case earned for Rosqueta
the right to recover moral damages from him. 8 Citing the abuse of right But petitioner Villanueva cannot seek shelter in the alleged advice that
principle, the RTC said that Villanueva acted maliciously when he the OSG gave him. Surely, a government official of his rank must
prevented Rosqueta from performing her duties, deprived her of know that a preliminary injunction order issued by a court of law had
salaries and leaves, and denied her official recognition as Deputy to be obeyed, especially since the question of Valera’s right to replace
Commissioner by excluding her from the centennial anniversary respondent Rosqueta had not yet been properly resolved.
memorabilia. Thus, the appellate court ordered Villanueva to pay
₱500,000.00 in moral damages, ₱200,000.00 in exemplary damages That petitioner Villanueva ignored the injunction shows bad faith and
and ₱100,000.00 in attorney’s fees and litigation expenses. With the intent to spite Rosqueta who remained in the eyes of the law the
denial of his motion for reconsideration, Villanueva filed this petition Deputy Commissioner. His exclusion of her from the centennial
for review on certiorari under Rule 45. anniversary memorabilia was not an honest mistake by any reckoning.
Indeed, he withheld her salary and prevented her from assuming the
The Issue Presented duties of the position. As the Court said in Amonoy v. Spouses
Gutierrez,13 a party’s refusal to abide by a court order enjoining him
The key issue presented in this case is whether or not the CA erred in from doing an act, otherwise lawful, constitutes an abuse and an
holding petitioner Villanueva liable in damages to respondent unlawful exercise of right.
Rosqueta for ignoring the preliminary injunction order that the RTC
issued in the quo warranto case (Civil Case 01-101539), thus denying That respondent Rosqueta was later appointed Deputy Commissioner
her of the right to do her job as Deputy Commissioner of the Bureau for another division of the Bureau is immaterial. While such
and to be officially recognized as such public officer. appointment, when accepted, rendered the quo warranto case moot
and academic, it did not have the effect of wiping out the injuries she
The Court’s Ruling suffered on account of petitioner Villanueva’s treatment of her. The
damage suit is an independent action.
Under the abuse of right principle found in Article 19 of the Civil
Code, 9 a person must, in the exercise of his legal right or duty, act in The CA correctly awarded moral damages to respondent Rosqueta.
good faith. He would be liable if he instead acts in bad faith, with Such damages may be awarded when the defendant’s transgression is
intent to prejudice another. Complementing this principle are Articles the immediate cause of the plaintiff’s anguish14 in the cases specified
2010 and 2111 of the Civil Code which grant the latter indemnity for in Article 221915 of the Civil Code.16
the injury he suffers because of such abuse of right or duty. 12
Here, respondent Rosqueta’s colleagues and friends testified that she
Petitioner Villanueva claims that he merely acted on advice of the suffered severe anxiety on account of the speculation over her
Office of the Solicitor General (OSG) when he allowed Valera to employment status.17 She had to endure being referred to as a
assume the office as Deputy Commissioner since respondent Rosqueta "squatter" in her workplace. She had to face inquiries from family and
friends about her exclusion from the Bureau’s centennial anniversary
memorabilia. She did not have to endure all these affronts and the
angst and depression they produced had Villanueva abided in good
faith by the court’s order in her favor. Clearly, she is entitled to moral
damages.

The Court, however, finds the award of ₱500,000.00 excessive. As it

held in Philippine Commercial International Bank v.
Alejandro,18 moral damages are not a bonanza. They are given to ease
the defendant’s grief and suffering. Moral damages should reasonably
approximate the extent of hurt caused and the gravity of the wrong
done. Here, that would be ₱200,000.00.

The Court affirms the grant of exemplary damages by way of example

or correction for the public good but, in line with the same reasoning,
reduces it to ₱50,000.00. Finally, the Court affirms the award of
attorney’s fees and litigation expenses but reduces it to ₱50,000.00.

WHEREFORE, the Court DENIES the petition and AFFIRMS the

decision of the Court of Appeals dated April 30, 2007 in CA-G.R. CV
85931 with MODIFICATION in that petitioner Titus B. Villanueva is
ORDERED to pay respondent Emma M. Rosqueta the sum of
₱200,000.00 in moral damages, ₱50,000.00 in exemplary damages,
and ₱50,000.00 in attorney’s fees and litigation expenses.

SO ORDERED.
G.R. No. 117009 October 11, 1995 In March 1981, SBTC thru Assistant Vice-President Susan Guanio
and a representative of an architectural firm consulted by SBTC,
SECURITY BANK & TRUST COMPANY and ROSITO C. verified Ferrer's claims for additional cost. A recommendation was
MANHIT, petitioners, then made to settle Ferrer's claim but only for P200,000.00. SBTC,
vs. instead of paying the recommended additional amount, denied ever
COURT OF APPEALS and YSMAEL C. FERRER, respondents. authorizing payment of any amount beyond the original contract price.
SBTC likewise denied any liability for the additional cost based on
Article IX of the building contract which states:

PADILLA, J.: If at any time prior to the completion of the work to

be performed hereunder, increase in prices of
In this petition for review under Rule 45 of the Rules of Court, construction materials and/or labor shall supervene
petitioners seek a review and reversal of the decision * of respondent through no fault on the part of the contractor
Court of Appeals in CA-G.R. CV No. 40450, entitled "Ysmael C. whatsoever or any act of the government and its
Ferrer v. Security Bank and Trust Company, et. al." dated 31 August instrumentalities which directly or indirectly affects
1994, which affirmed the decision ** of the Regional Trial Court, the increase of the cost of the project, OWNER shall
Branch 63, Makati in Civil Case No. 42712, a complaint for breach of equitably make the appropriate adjustment on mutual
contract with damages. agreement of both parties.

Private respondent Ysmael C. Ferrer was contracted by herein Ysmael C. Ferrer then filed a complaint for breach of contract with
petitioners Security Bank and Trust Company (SBTC) and Rosito C. damages. The trial court ruled for Ferrer and ordered defendants
Manhit to construct the building of SBTC in Davao City for the price SBTC and Rosito C. Manhit to pay:
of P1,760,000.00. The contract dated 4 February 1980 provided that
Ferrer would finish the construction in two hundred (200) working a) P259,417.23 for the increase in price of labor and
days. Respondent Ferrer was able to complete the construction of the materials plus 12% interest thereon per annum from
building on 15 August 1980 (within the contracted period) but he was 15 August 1980 until fully paid;
compelled by a drastic increase in the cost of construction materials to
incur expenses of about P300,000.00 on top of the original cost. The b) P24,000.00 as actual damages;
additional expenses were made known to petitioner SBTC thru its
Vice-President Fely Sebastian and Supervising Architect Rudy de la c) P20,000.00 as moral damages;
Rama as early as March 1980. Respondent Ferrer made timely
demands for payment of the increased cost. Said demands were d) P20,000.00 as exemplary damages;
supported by receipts, invoices, payrolls and other documents proving
the additional expenses. e) attorney's fees equivalent to 25% of the principal
amount due; and
 f) costs of suit. Respondent Ysmael C. Ferrer, through counsel, on the other hand,
opposed the arguments raised by petitioners. It is of note however that
On appeal, the Court of Appeals affirmed the trial court decision. the pleadings filed with this Court by counsel for Ferrer hardly refute
the arguments raised by petitioners, as the contents of said pleadings
In the present petition for review, petitioners assign the following are mostly quoted portions of the decision of the Court of Appeals,
errors to the appellate court: devoid of adequate discussion of the merits of respondent's case. The
Court, to be sure, expects more diligence and legal know-how from
. . . IN HOLDING THAT PLAINTIFF-APPELLEE lawyers than what has been exhibited by counsel for respondent in the
HAS, BY PREPONDERANCE OF EVIDENCE present case. Under these circumstances, the Court had to review the
SUFFICIENTLY PROVEN HIS CLAIM AGAINST entire records of this case to evaluate the merits of the issues raised by
THE DEFENDANTS-APPELLANTS. the contending parties.

. . . IN INTERPRETING AN OTHERWISE CLEAR Article 22 of the Civil Code which embodies the maxim, Nemo ex
AND UNAMBIGUOUS PROVISION OF THE alterius incommodo debet lecupletari (no man ought to be made rich
CONSTRUCTION CONTRACT. out of another's injury) states:

. . . IN DISREGARDING THE EXPRESS Art. 22. Every person who through an act of
PROVISION OF THE CONSTRUCTION performance by another, or any other means, acquires
CONTRACT, THE LOWER COURT VIOLATED or comes into possession of something at the expense
DEFENDANTS-APPELLANTS' of the latter without just or legal ground, shall return
CONSTITUTIONAL GUARANTY OF NON the same to him.
IMPAIRMENT OF THE OBLIGATION OF
CONTRACT.1 The above-quoted article is part of the chapter of the Civil Code on
Human Relations, the provisions of which were formulated as "basic
Petitioners argue that under the aforequoted Article IX of the building principles to be observed for the rightful relationship between human
contract, any increase in the price of labor and/or materials resulting beings and for the stability of the social order, . . . designed to indicate
in an increase in construction cost above the stipulated contract price certain norms that spring from the fountain of good conscience, . . .
will not automatically make petitioners liable to pay for such increased guides for human conduct [that] should run as golden threads through
cost, as any payment above the stipulated contract price has been made society to the end that law may approach its supreme ideal which is
subject to the condition that the "appropriate adjustment" will be made the sway and dominance of justice." 2
"upon mutual agreement of both parties". It is contended that since
there was no mutual agreement between the parties, petitioners' In the present case, petitioners' arguments to support absence of
obligation to pay amounts above the original contract price never liability for the cost of construction beyond the original contract price
materialized. are not persuasive.
Under the previously quoted Article IX of the construction contract, logically give consent to such an agreement which would allow him
petitioners would make the appropriate adjustment to the contract recovery of the increased cost.
price in case the cost of the project increases through no fault of the
contractor (private respondent). Private respondent informed Further, it cannot be denied that petitioner bank derived benefits when
petitioners of the drastic increase in construction cost as early as private respondent completed the construction even at an increased
March 1980. cost.

Petitioners in turn had the increased cost evaluated and audited. When Hence, to allow petitioner bank to acquire the constructed building at
private respondent demanded payment of P259,417.23, petitioner a price far below its actual construction cost would undoubtedly
bank's Vice-President Rosito C. Manhit and the bank's architectural constitute unjust enrichment for the bank to the prejudice of private
consultant were directed by the bank to verify and compute private respondent. Such unjust enrichment, as previously discussed, is not
respondent's claims of increased cost. A recommendation was then allowed by law.
made to settle private respondent's claim for P200,000.00. Despite this
recommendation and several demands from private respondent, SBTC Finally, with respect to the award of attorney's fees to respondent, the
failed to make payment. It denied authorizing anyone to make a Court has previously held that, "even with the presence of an
settlement of private respondent's claim and likewise denied any agreement between the parties, the court may nevertheless reduce
liability, contending that the absence of a mutual agreement made attorney's fees though fixed in the contract when the amount thereof
private respondent's demand premature and baseless. appears to be unconscionable or unreasonable."3 As previously noted,
the diligence and legal know-how exhibited by counsel for private
Petitioners' arguments are specious. respondent hardly justify an award of 25% of the principal amount
due, which would be at least P60,000.00. Besides, the issues in this
It is not denied that private respondent incurred additional expenses in case are far from complex and intricate. The award of attorney's fees
constructing petitioner bank's building due to a drastic and unexpected is thus reduced to P10,000.00.
increase in construction cost. In fact, petitioner bank admitted liability
for increased cost when a recommendation was made to settle private WHEREFORE, with the above modification in respect of the amount
respondent's claim for P200,000.00. Private respondent's claim for the of attorney's fees, the appealed decision of the Court of Appeals in CA
increased amount was adequately proven during the trial by receipts, G.R. CV No. 40450 is AFFIRMED.
invoices and other supporting documents.

Under Article 1182 of the Civil Code, a conditional obligation shall

be void if its fulfillment depends upon the sole will of the debtor. In
the present case, the mutual agreement, the absence of which
petitioner bank relies upon to support its non-liability for the increased
construction cost, is in effect a condition dependent on petitioner
bank's sole will, since private respondent would naturally and
G.R. No. 158253 March 2, 2007 the works, made advances for the purchase of the materials and
payment for labor costs.6
REPUBLIC OF THE PHILIPPINES, represented by the
DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS, On October 29, 1992, personnel of the Office of the District Engineer
COMMISSION ON AUDIT and THE NATIONAL of San Fernando, Pampanga conducted a final inspection of the project
TREASURER, Petitioner, and found it 100% completed in accordance with the approved plans
vs. and specifications. Accordingly, the Office of the District Engineer
CARLITO LACAP, doing business under the name and style issued Certificates of Final Inspection and Final Acceptance.7
CARWIN CONSTRUCTION AND CONSTRUCTION
SUPPLY, Respondent. Thereafter, respondent sought to collect payment for the completed
project.8 The DPWH prepared the Disbursement Voucher in favor of
DECISION petitioner.9 However, the DPWH withheld payment from respondent
after the District Auditor of the Commission on Audit (COA)
AUSTRIA-MARTINEZ, J.: disapproved the final release of funds on the ground that the
contractor’s license of respondent had expired at the time of the
Before the Court is a Petition for Review on Certiorari under Rule 45 execution of the contract. The District Engineer sought the opinion of
of the Revised Rules of Court assailing the Decision1 dated April 28, the DPWH Legal Department on whether the contracts of Carwin
2003 of the Court of Appeals (CA) in CA-G.R. CV No. 56345 which Construction for various Mount Pinatubo rehabilitation projects were
affirmed with modification the Decision2 of the Regional Trial Court, valid and effective although its contractor’s license had already
Branch 41, San Fernando, Pampanga (RTC) in Civil Case No. 10538, expired when the projects were contracted.10
granting the complaint for Specific Performance and Damages filed
by Carlito Lacap (respondent) against the Republic of the Philippines In a Letter-Reply dated September 1, 1993, Cesar D. Mejia, Director
(petitioner). III of the DPWH Legal Department opined that since Republic Act
No. 4566 (R.A. No. 4566), otherwise known as the Contractor’s
The factual background of the case is as follows: License Law, does not provide that a contract entered into after the
license has expired is void and there is no law which expressly
The District Engineer of Pampanga issued and duly published an prohibits or declares void such contract, the contract is enforceable
"Invitation To Bid" dated January 27, 1992. Respondent, doing and payment may be paid, without prejudice to any appropriate
business under the name and style Carwin Construction and administrative liability action that may be imposed on the contractor
Construction Supply (Carwin Construction), was pre-qualified and the government officials or employees concerned.11
together with two other contractors. Since respondent submitted the
lowest bid, he was awarded the contract for the concreting In a Letter dated July 4, 1994, the District Engineer requested
of Sitio 5 Bahay Pare.3 On November 4, 1992, a Contract Agreement clarification from the DPWH Legal Department on whether Carwin
was executed by respondent and petitioner.4 On September 25, 1992, Construction should be paid for works accomplished despite an
District Engineer Rafael S. Ponio issued a Notice to Proceed with the expired contractor’s license at the time the contracts were executed. 12
concreting of Sitio 5 Bahay Pare.5 Accordingly, respondent undertook
In a First Indorsement dated July 20, 1994, Cesar D. Mejia, Director a) ₱457,000.00 – representing the contract for the concreting project
III of the Legal Department, recommended that payment should be of Sitio 5 road, Bahay Pare, Candaba, Pampanga plus interest at 12%
made to Carwin Construction, reiterating his earlier legal from demand until fully paid; and
opinion.13 Despite such recommendation for payment, no payment
was made to respondent. b) The costs of suit.

Thus, on July 3, 1995, respondent filed the complaint for Specific SO ORDERED.21
Performance and Damages against petitioner before the RTC. 14
The RTC held that petitioner must be required to pay the contract price
On September 14, 1995, petitioner, through the Office of the Solicitor since it has accepted the completed project and enjoyed the benefits
General (OSG), filed a Motion to Dismiss the complaint on the thereof; to hold otherwise would be to overrun the long standing and
grounds that the complaint states no cause of action and that the RTC consistent pronouncement against enriching oneself at the expense of
had no jurisdiction over the nature of the action since respondent did another.22
not appeal to the COA the decision of the District Auditor to
disapprove the claim. 15 Dissatisfied, petitioner filed an appeal with the CA. 23 On April 28,
2003, the CA rendered its Decision sustaining the Decision of the
Following the submission of respondent’s Opposition to Motion to RTC. It held that since the case involves the application of the
Dismiss,16 the RTC issued an Order dated March 11, 1996 denying the principle of estoppel against the government which is a purely legal
Motion to Dismiss.17 The OSG filed a Motion for question, then the principle of exhaustion of administrative remedies
Reconsideration18 but it was likewise denied by the RTC in its Order does not apply; that by its actions the government is estopped from
dated May 23, 1996.19 questioning the validity and binding effect of the Contract Agreement
with the respondent; that denial of payment to respondent on purely
On August 5, 1996, the OSG filed its Answer invoking the defenses technical grounds after successful completion of the project is not
of non-exhaustion of administrative remedies and the doctrine of non- countenanced either by justice or equity.
suability of the State.20
The CA rendered herein the assailed Decision dated April 28, 2003,
Following trial, the RTC rendered on February 19, 1997 its Decision, the dispositive portion of which reads:
the dispositive portion of which reads as follows:
WHEREFORE, the decision of the lower court is hereby AFFIRMED
WHEREFORE, in view of all the foregoing consideration, judgment with modification in that the interest shall be six percent (6%) per
is hereby rendered in favor of the plaintiff and against the defendant, annum computed from June 21, 1995.
ordering the latter, thru its District Engineer at Sindalan, San
Fernando, Pampanga, to pay the following: SO ORDERED.24

Hence, the present petition on the following ground:

THE COURT OF APPEALS ERRED IN NOT FINDING THAT submitted to a court without first giving such administrative agency
RESPONDENT HAS NO CAUSE OF ACTION AGAINST the opportunity to dispose of the same after due deliberation. 30
PETITIONER, CONSIDERING THAT:
Corollary to the doctrine of exhaustion of administrative remedies is
(a) RESPONDENT FAILED TO EXHAUST ADMINISTRATIVE the doctrine of primary jurisdiction; that is, courts cannot or will not
REMEDIES; AND determine a controversy involving a question which is within the
jurisdiction of the administrative tribunal prior to the resolution of that
(b) IT IS THE COMMISSION ON AUDIT WHICH HAS THE question by the administrative tribunal, where the question demands
PRIMARY JURISDICTION TO RESOLVE RESPONDENT’S the exercise of sound administrative discretion requiring the special
MONEY CLAIM AGAINST THE GOVERNMENT.25 knowledge, experience and services of the administrative tribunal to
determine technical and intricate matters of fact.31
Petitioner contends that respondent’s recourse to judicial action was
premature since the proper remedy was to appeal the District Auditor’s Nonetheless, the doctrine of exhaustion of administrative remedies
disapproval of payment to the COA, pursuant to Section 48, and the corollary doctrine of primary jurisdiction, which are based on
Presidential Decree No. 1445 (P.D. No. 1445), otherwise known as sound public policy and practical considerations, are not inflexible
the Government Auditing Code of the Philippines; that the COA has rules. There are many accepted exceptions, such as: (a) where there is
primary jurisdiction to resolve respondent’s money claim against the estoppel on the part of the party invoking the doctrine; (b) where the
government under Section 2(1),26 Article IX of the 1987 Constitution challenged administrative act is patently illegal, amounting to lack of
and Section 2627 of P.D. No. 1445; that non-observance of the doctrine jurisdiction; (c) where there is unreasonable delay or official inaction
of exhaustion of administrative remedies and the principle of primary that will irretrievably prejudice the complainant; (d) where the amount
jurisdiction results in a lack of cause of action. involved is relatively small so as to make the rule impractical and
oppressive; (e) where the question involved is purely legal and will
Respondent, on the other hand, in his Memorandum28 limited his ultimately have to be decided by the courts of justice; 32 (f) where
discussion to Civil Code provisions relating to human relations. He judicial intervention is urgent; (g) when its application may cause
submits that equity demands that he be paid for the work performed; great and irreparable damage; (h) where the controverted acts violate
otherwise, the mandate of the Civil Code provisions relating to human due process; (i) when the issue of non-exhaustion of administrative
relations would be rendered nugatory if the State itself is allowed to remedies has been rendered moot;33 (j) when there is no other plain,
ignore and circumvent the standard of behavior it sets for its speedy and adequate remedy; (k) when strong public interest is
inhabitants. involved; and, (l) in quo warranto proceedings. 34 Exceptions (c) and
(e) are applicable to the present case.
The present petition is bereft of merit.
Notwithstanding the legal opinions of the DPWH Legal Department
The general rule is that before a party may seek the intervention of the rendered in 1993 and 1994 that payment to a contractor with an
court, he should first avail of all the means afforded him by expired contractor’s license is proper, respondent remained unpaid for
administrative processes.29 The issues which administrative agencies the completed work despite repeated demands. Clearly, there was
are authorized to decide should not be summarily taken from them and
unreasonable delay and official inaction to the great prejudice of On the question of whether a contractor with an expired license is
respondent. entitled to be paid for completed projects, Section 35 of R.A. No. 4566
explicitly provides:
Furthermore, whether a contractor with an expired license at the time
of the execution of its contract is entitled to be paid for completed SEC. 35. Penalties. Any contractor who, for a price, commission, fee
projects, clearly is a pure question of law. It does not involve an or wage, submits or attempts to submit a bid to construct, or contracts
examination of the probative value of the evidence presented by the to or undertakes to construct, or assumes charge in a supervisory
parties. There is a question of law when the doubt or difference arises capacity of a construction work within the purview of this Act, without
as to what the law is on a certain state of facts, and not as to the truth first securing a license to engage in the business of contracting in this
or the falsehood of alleged facts.35 Said question at best could be country; or who shall present or file the license certificate of another,
resolved only tentatively by the administrative authorities. The final give false evidence of any kind to the Board, or any member thereof
decision on the matter rests not with them but with the courts of in obtaining a certificate or license, impersonate another, or use an
justice. Exhaustion of administrative remedies does not apply, because expired or revoked certificate or license, shall be deemed guilty of
nothing of an administrative nature is to be or can be done.36 The issue misdemeanor, and shall, upon conviction, be sentenced to pay a fine
does not require technical knowledge and experience but one that of not less than five hundred pesos but not more than five thousand
would involve the interpretation and application of law. pesos. (Emphasis supplied)

Thus, while it is undisputed that the District Auditor of the COA The "plain meaning rule" or verba legis in statutory construction is
disapproved respondent’s claim against the Government, and, under that if the statute is clear, plain and free from ambiguity, it must be
Section 4837 of P.D. No. 1445, the administrative remedy available to given its literal meaning and applied without interpretation. 40 This rule
respondent is an appeal of the denial of his claim by the District derived from the maxim Index animi sermo est (speech is the index of
Auditor to the COA itself, the Court holds that, in view of exceptions intention) rests on the valid presumption that the words employed by
(c) and (e) narrated above, the complaint for specific performance and the legislature in a statute correctly express its intention or will and
damages was not prematurely filed and within the jurisdiction of the preclude the court from construing it differently. The legislature is
RTC to resolve, despite the failure to exhaust administrative remedies. presumed to know the meaning of the words, to have used words
As the Court aptly stated in Rocamora v. RTC-Cebu (Branch VIII):38 advisedly, and to have expressed its intent by use of such words as are
found in the statute.41 Verba legis non est recedendum, or from the
The plaintiffs were not supposed to hold their breath and wait until the words of a statute there should be no departure. 42
Commission on Audit and the Ministry of Public Highways had acted
on the claims for compensation for the lands appropriated by the The wordings of R.A. No. 4566 are clear. It does not declare, expressly
government. The road had been completed; the Pope had come and or impliedly, as void contracts entered into by a contractor whose
gone; but the plaintiffs had yet to be paid for the properties taken from license had already expired. Nonetheless, such contractor is liable for
them. Given this official indifference, which apparently would payment of the fine prescribed therein. Thus, respondent should be
continue indefinitely, the private respondents had to act to assert and paid for the projects he completed. Such payment, however, is without
protect their interests.39 prejudice to the payment of the fine prescribed under the law.
Besides, Article 22 of the Civil Code which embodies the maxim
Nemo ex alterius incommode debet lecupletari (no man ought to be
made rich out of another’s injury) states:

Art. 22. Every person who through an act of performance by another,

or any other means, acquires or comes into possession of something at
the expense of the latter without just or legal ground, shall return the
same to him.

This article is part of the chapter of the Civil Code on Human

Relations, the provisions of which were formulated as "basic
principles to be observed for the rightful relationship between human
beings and for the stability of the social order, x x x designed to
indicate certain norms that spring from the fountain of good
conscience, x x x guides human conduct [that] should run as golden
threads through society to the end that law may approach its supreme
ideal which is the sway and dominance of justice."43 The rules thereon
apply equally well to the Government.44 Since respondent had
rendered services to the full satisfaction and acceptance by petitioner,
then the former should be compensated for them. To allow petitioner
to acquire the finished project at no cost would undoubtedly constitute
unjust enrichment for the petitioner to the prejudice of respondent.
Such unjust enrichment is not allowed by law.

WHEREFORE, the present petition is DENIED for lack of merit. The

assailed Decision of the Court of Appeals dated April 28, 2003 in CA-
G.R. CV No. 56345 is AFFIRMED. No pronouncement as to costs.

SO ORDERED.
G.R. Nos. 147925-26 June 8, 2009 PEA, however, could not deliver any work area to EDC because the
horizontal works of MDC were still ongoing. EDC commenced the
ELPIDIO S. UY, doing business under the name and style landscaping works only on January 7, 1997 when PEA finally made
EDISON DEVELOPMENT & CONSTRUCTION, Petitioner, an initial delivery of a work area.
vs.
PUBLIC ESTATES AUTHORITY and the HONORABLE PEA continuously incurred delay in the turnover of work areas.
COURT OF APPEALS, Respondents. Resultantly, the contract period of 450 days was extended to 693 days.
PEA also failed to turn over the entire 105-hectare work area due to
DECISION the presence of squatters. Thus, on March 15, 1999, the PEA Project
Management Office (PEA-PMO) issued Change Order No. 2-
NACHURA, J.: LC,6 excluding from the contract the 45-square-meter portion of the
park occupied by squatters.
Petitioner Elpidio S. Uy (Uy) appeals by certiorari the Joint
Decision1 dated September 25, 2000 and the Joint Resolution2 dated In view of the delay in the delivery of work area, EDC claimed
April 25, 2001 of the Court of Appeals (CA) in the consolidated cases additional cost from the PEA-PMO amounting to ₱181,338,056.30.
CA-G.R. SP Nos. 59308 and 59849. Specifically, Uy alleged that he incurred additional rental costs for the
equipment, which were kept on standby, and labor costs for the idle
Respondent Public Estates Authority (PEA) was designated as project manpower. He added that the delay by PEA caused the topsoil at the
manager by the Bases Conversion Development Authority (BCDA), original supplier to be depleted; thus, he was compelled to obtain the
primarily tasked to develop its 105-hectare demilitarized lot in Fort topsoil from a farther source, thereby incurring extra costs. He also
Bonifacio, Taguig City into a first-class memorial park to be known claims that he had to mobilize water trucks for the plants and trees
as Heritage Park. PEA then engaged the services of Makati which had already been delivered to the site. Furthermore, it became
Development Corporation (MDC) to undertake the horizontal works necessary to construct a nursery shade to protect and preserve the
on the project; and Uy, doing business under the name and style young plants and trees prior to actual transplanting to the landscaped
Edison Development and Construction (EDC), to do the landscaping. area. The PEA-PMO evaluated the EDC’s claim and arrived at a lesser
amount of ₱146,484,910.7 The evaluation of PEA-PMO was then
For a contract price of Three Hundred Fifty-Five Million Eighty referred to the Heritage Park Executive Committee (ExCom) for
Thousand One Hundred Forty-One and 15/100 Pesos approval.
(₱355,080,141.15), PEA and EDC signed the Landscaping and
Construction Agreement3 on November 20, 1996. EDC undertook to On November 12, 1999, the Performance Audit Committee (PAC)
complete the landscaping works in four hundred fifty (450) days reviewed the progress report submitted by the works engineer and
commencing on the date of receipt of the notice to proceed. noted that the EDC’s landscaping works were behind schedule by
twenty percent (20%). The PAC considered this delay unreasonable
EDC received the notice to proceed on December 3, 1996; 4 and three and intolerable, and immediately recommended to BCDA the
(3) days after, or on December 6, 1996,5 it commenced the termination of the landscaping contract. 8 The BCDA adopted PAC’s
mobilization of the equipment and manpower needed for the project. recommendation and demanded from PEA the termination of the
contract with EDC. In compliance, PEA terminated the agreement on deemed to be at that time already a forbearance of credit" (Eastern
November 29, 1999. Shipping Lines, Inc. v. Court of Appeals, et al., 243 SCRA 78
[1994]; Keng Hua Paper Products Co., Inc. v. Court of Appeals, 286
PEA fully paid all the progress billings up to August 26, 1999, but it SCRA 257 [1998]; Crismina Garments, Inc. v. Court of Appeals, G.R.
did not heed EDC’s additional claims. Consequently, Uy filed a No. 128721, March 9, 1999).
Complaint9 with the Construction Industry Arbitration Commission
(CIAC), docketed as CIAC Case No. 02-2000. SO ORDERED.11

On May 16, 2000, the CIAC rendered a Decision, 10 the dispositive Uy received the CIAC decision on June 7, 2000. On June 16, 2000,
portion of which reads: Uy filed a motion for correction of computation, 12 followed by an
amended motion for correction of computation, 13 on July 21, 2000.
WHEREFORE, Judgment is hereby rendered in favor of the The CIAC, however, failed to resolve Uy’s motion and amended
[Petitioner] Contractor ELPIDIO S. UY and Award is hereby made motion within the 30-day period as provided in its rules, and Uy
on its monetary claims as follows: considered it as denial of the motion.

Respondent PUBLIC ESTATES AUTHORITY is directed to pay Hence, on July 24, 2000, Uy filed a petition for review14 with the CA,
the [petitioner] the following amounts: docketed as CA-G.R. SP No. 59849. Uy’s petition was consolidated
with CA-G.R. SP No. 59308, the earlier petition filed by PEA,
assailing the same CIAC decision.
₱19,604,132.06 --- for the cost of idle time of equipment.
2,275,721.00 --- for the cost of idled manpower. On August 1, 2000, the CIAC issued an Order 15 denying Uy’s motion
for correction of computation.
--- for the construction of the nursery
6,050,165.05
shade net area. On September 25, 2000, the CA rendered the now assailed Joint
Decision dismissing both petitions on both technical and substantive
605,016.50 --- for attorney’s fees.
grounds. PEA’s petition was dismissed because the verification
thereof was defective. Uy’s petition, on the other hand, was dismissed
Interest on the amount of ₱6,050,165.05 as cost for the construction upon a finding that it was belatedly filed. Further, the CA found no
of the nursery shade net area shall be paid at the rate of 6% per annum sufficient basis to warrant the reversal of the CIAC ruling, which it
from the date the Complaint was filed on 12 January 2000. Interest on held is based on clear provisions of the contract, the evidence on
the total amount of ₱21,879,853.06 for the cost of idled manpower record and relevant law and jurisprudence.
and equipment shall be paid at the same rate of 6% per annum from
the date this Decision is promulgated. After finality of this Decision, The CA disposed thus:
interest at the rate of 12% per annum shall be paid on the total of these
3 awards amounting to ₱27,930,018.11 until full payment of the WHEREFORE, premises considered, the petitions in CA-G.R. SP No.
awarded amount shall have been made, "this interim period being 59308, entitled "Public Estates Authority v. Elpidio S. Uy, doing
business under the name and style of Edison [D]evelopment & CONSTRUCTION v. PUBLIC ESTATES AUTHORITY and/or
Construction," and CA-G.R. SP No. 59849, "Elpidio S. Uy, doing HONORABLE CARLOS P. DOBLE.
business under the name and style of Edison [D]evelopment &
Construction v. Public Estates Authority," are both hereby DENIED SO ORDERED.18
DUE COURSE and accordingly DISMISSED, for lack of merit.
PEA and Uy then came to us with their respective petitions for review
Consequently, the Award/Decision issued by the Construction assailing the CA ruling. PEA’s petition was docketed as G.R. Nos.
Industry Arbitration Commission on May 16, 2000 in CIAC Case No. 147933-34, while that of Uy was docketed as G.R. Nos. 147925-26.
02-2000, entitled "Elpidio S. Uy, doing business under the name and The petitions, however, were not consolidated.
style of Edison [D]evelopment & Construction v. Public Estates
Authority," is hereby AFFIRMED in toto. On December 12, 2001, this Court resolved G.R. Nos. 147933-34 in
this wise:
No pronouncement as to costs.
WHEREFORE, in view of the foregoing, the petition for review is
SO ORDERED.16 DENIED. The Motion to Consolidate this petition with G.R. No.
147925-26 is also DENIED.
PEA and Uy filed motions for reconsideration. Subsequently, PEA
filed with the CA an Urgent Motion for Issuance of a Temporary SO ORDERED.19
Restraining Order and/or Writ of Preliminary Injunction, 17 seeking to
enjoin the CIAC from proceeding with CIAC Case No. 03-2001, Thus, what remains for us to resolve is Uy’s petition, raising the
which Uy had subsequently filed. PEA alleged that the case involved following issues:
claims arising from the same Landscaping and Construction
Agreement, subject of the cases pending with the CA. I

On April 25, 2001, the CA issued the assailed Joint Resolution, thus: WHETHER OR NOT RESPONDENT COURT OF APPEALS HAS
DEPARTED FROM THE ACCEPTED AND USUAL COURSE OF
WHEREFORE, the present Motion/s for Reconsideration in CA-G.R. JUDICIAL PROCEEDINGS IN DISMISSING PETITIONER UY’S
SP No. 59308 and CA-G.R. SP No. 59849 are hereby both DENIED, PETITION IN CA-G.R. SP NO. 59849 ON THE ALLEGED
for lack of merit. GROUND OF NON-COMPLIANCE WITH THE
REGLEMENTARY PERIOD IN FILING AN APPEAL
Accordingly, let an injunction issue permanently enjoining the
Construction Industry Arbitration Commission from proceeding with II
CIAC CASE NO. 03-2001, entitled ELPIDIO S. UY, doing business
under the name and style of EDISON DEVELOPMENT & WHETHER OR NOT THE RESPONDENT COURT OF APPEALS,
IN AFFIRMING THE DECISION OF THE CIAC ARBITRAL
TRIBUNAL INSOFAR AS IT DENIED CERTAIN CLAIMS OF a. An evident miscalculation of figures, a typographical or
PETITIONER UY, HAS DECIDED A QUESTION OF arithmetical error;
SUBSTANCE NOT IN ACCORDANCE WITH LAW AND THE
APPLICABLE DECISIONS OF THE HONORABLE COURT b. An evident mistake in the description of any party, person,
date, amount, thing or property referred to in the award.
III
The filing of the motion for correction shall interrupt the running of
WHETHER OR NOT THE RESPONDENT COURT OF APPEALS the period for appeal.
ACTED WITHOUT OR IN EXCESS OF ITS JURISDICTION OR
WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO With the filing of the motion for correction, the running of the period
LACK OR EXCESS OF JURISDICTION WHEN IT ENJOINED to appeal was effectively interrupted.
THE PROCEEDINGS IN CIAC CASE NO. 03-2001 IN ITS JOINT
RESOLUTION DATED 25 APRIL 2000, WHICH CASE IS CIAC was supposed to resolve the motion for correction of
TOTALLY DIFFERENT FROM THE CASE A QUO20 computation within 30 days from the time the comment or opposition
thereto was submitted. In Uy’s case, no resolution was issued despite
We will deal first with the procedural issue. the lapse of the 30-day period, and Uy considered it as a denial of his
motion. Accordingly, he elevated his case to the CA on July 24, 2000.
Appeals from judgment of the CIAC shall be taken to the CA by filing But not long thereafter, or on August 1, 2000, the CIAC issued an
a petition for review within fifteen (15) days from the receipt of the Order22 denying the motion for correction of computation.
notice of award, judgment, final order or resolution, or from the date
of its last publication if publication is required by law for its Obviously, when Uy filed his petition for review with the CA, the
effectivity, or of the denial of petitioner’s motion for new trial or period to appeal had not yet lapsed; it was interrupted by the pendency
reconsideration duly filed in accordance with the governing law of the of his motion for computation. There is no basis, therefore, to conclude
court or agency a quo.21 that the petition was belatedly filed.

Admittedly, Uy received the CIAC decision on June 7, 2000; that The foregoing notwithstanding, inasmuch as the CA resolved the
instead of filing a verified petition for review with the CA, Uy filed a petition on the merits, we now confront the substantive issue – the
motion for correction of computation on June 16, 2000, pursuant to propriety of the CA’s affirmance of the CIAC decision.
Section 9, Article XV of the Rules of Procedure Governing
Construction Arbitration: Uy cries foul on the award granted by CIAC, and affirmed by the CA.
He posits that PEA already admitted its liability, pegged at
Section 9. Motion for Reconsideration. – As a matter of policy, no ₱146,484,910.10, in its memorandum dated January 6, 2000. Thus, he
motion for reconsideration shall be allowed. Any of the parties may, faults the CA for awarding a lesser amount.
however, file a motion for correction within fifteen (15) days from
receipt of the award upon any of the following grounds: We meticulously reviewed the records before us and failed to discern
any admission of liability on the part of PEA.
The PEA-PMO evaluation dated January 6, 2000, 23 where PEA b. Manpower on 28,165,022.00 2,275,721.00 2,275,721.0
allegedly admitted its liability, reads in full: Standby
c. Topsoil Add’l 37,780,200.00 37,780,200.00 37,780,200
MEMORANDUM Hauling
Distance
For : Mr. Jaime R. Millan d. Water Truck 19,652,000.00 15,467,800.00 19,652,000
Project Manager Operating Cost
Heritage Park Project
Total ₱181,338,056.30 122,946,561.40 146,484,9
Subject: EDC’s Various Claim
Landscape Development Works Further, it is being specified that the PMO maintains the earlier notes
of the CMO in its memo of 18 October 1999 and that legal
Revision shall be made on our evaluation dated 28 December 1999 interpretations on each item of claims is likewise enjoined.
concerning various claims of contractor EDC-Landscape
Development Works (Package IV), particularly on the claim on Attached are pertinent documents for your review and reference
Project Equipment on Standby (item a of the earlier evaluation).
(Sgd.) (Sgd.)
Reference to item 4 of the Terms and Conditions of 1998 ACEL Rate ROGELIO H. IGNACIO FLORO C. URCIA
Equipment Guidebook, the CMO inadvertently did not consider are PMO-B Asst. Project Manager
the wages and salaries of standby operator/driver corresponding to the
equipment standby being claimed.
By no stretch of the imagination can we consider this memorandum
Thus, the corresponding gross amount to be incorporated shall be an admission of liability on the part of PEA. First, nowhere in the
₱4,925,600.00 computed based on the total man-months of each memorandum does it say that PEA is admitting its liability. The
standby equipment being claimed. evaluation contained in the above memorandum is merely a
verification of the accuracy of EDC’s claims. As a matter of fact, the
A tabulation of the claims is shown hereinbelow: evaluation is still subject for review by the project manager, whose
decision on the matter requires the approval of the Heritage Park
ExCom. Second, Messrs. Ignacio and Urcia had no legal authority to
Works Engineer PMO
Nature of Claim EDC Claim make admissions on behalf of PEA. Thus, even assuming that the
Evaluation Evaluation
evaluation contained in the memorandum was in the nature of an
a. Project Equipment ₱95,740,834.30 67,422,840.40 81,851,396.08
admission, the same cannot bind PEA. Third, Uy filed his complaint
on Standby with the CIAC because PEA did not act on EDC’s various claims. This
Equipment 4,925,600.00
supports our conclusion that PEA never admitted, but on the contrary
Operator/Driver denied, whatever additional liabilities were claimed by Uy under the
landscaping contract.
Neither do we find any admission of liability on the part of PEA during Upon review of the records before us, we find a need to modify, by
the proceedings before the CIAC. What was admitted by PEA was that increasing, the award for standby equipment cost.
PMO evaluated the claim at the lesser amount of ₱146,484,910 (Exh.
"S").24 The admission of the evaluation made by PEA cannot translate CIAC found that PEA incurred delays in the turnover of work areas:
to an admission of liability. There is simply no basis for Uy to claim
that PEA had admitted its liability. The first delay was the turn-over of a portion of Area 1 A that was
made on 17 April 1997. The start of work on that area was scheduled
This issue disposed of, we now resolve Uy’s claims on the basis of the for March, 1997. There was, therefore, a delay of about one month.
evidence presented. The second delay was the turn-over of a portion of Area 2 A that was
made on 20 October 1997. The start of work on that area was
Uy claims ₱95,740,834.30 as the standby equipment cost. CIAC, scheduled for May, 1997. There was, therefore, a delay of about five
however, did not agree and granted only ₱19,604,132.06 as the cost of months. The third delay was the turn-over of a portion of Area 2 B that
standby equipment using its so-called equitable method: was made on 05 March 1998. The start of work on that area was
scheduled for mid-February 1997. There was, therefore, a delay of
[Uy] had mobilized manpower and equipment sufficient to do the more than one (1) year. Altogether,
landscaping works for the entire 105 hectares. The unilateral reduction
in scope of work made by [PEA] thus laid idle the men and equipment the several periods of delayed turn-over of work areas total one year
of [Uy] in direct proportion to said reduction. In effect, therefore, Uy and six months or 546 days.26
had on hand manpower and equipment amounting to 42.85% in excess
of that necessary to perform the landscaping works for the reduced Surely, on the days that EDC was waiting for the turnover of
scope of work. [Uy] thus suffered costs in terms of excess manpower additional work areas, it was paying rentals for the equipment on
and equipment in proportion to the reduced scope of work. standby. Yet, CIAC completely ignored these delays in determining
the cost of equipment on standby, reasoning that:
xxxx
It must be pointed out, however, that the division of the vast area to be
The total contract period – original extensions – to complete the landscaped into distinct work areas with different start of work
landscaping works for the entire 105 hectares is 693 days. The schedules under the PERT-CPM, [Uy] could easily have shifted his
reduction in scope of work 42.85% laid idle his equipment by the same equipment from an area where the delivery was delayed to the area
percentage of 42.85[%] or 296.95 days. Since [Uy] calculated his where there was an advanced turn-over.27
claim for idled equipment on a per month basis, it is necessary to
convert this into months. 296.95 days is equivalent of 9.89 months. This is wrong.
Multiplied by the rate of ₱1,982,217.60 per month of delay, this would
translate to ₱19,604,132.06 as the cost of idle time for equipment by Records establish that EDC promptly commenced the landscaping
reason of the [delay].25 work on every area that was turned over. EDC, in fact, shifted its
equipment where there was an advance delivery, if only to minimize
the additional expenses incurred by reason of the long delays in the
turnover of the other work areas. Thus, in addition to the award of ART. 1724. The contractor who undertakes to build a structure or any
₱19,604,132.06 for cost of idle time for equipment by reason of the other work for a stipulated price, in conformity with plans and
reduction of scope of work, specifications agreed upon with the land-owner, can neither withdraw
from the contract nor demand an increase in the price on account of
Uy is entitled to the cost of idle time for equipment by reason of the the higher cost of labor or materials, save when there has been a
delay incurred in the delivery of work areas. change in the plans and specifications, provided:

The period of owner-caused delay was 546 days or 18.2 months. The (1) Such change has been authorized by the proprietor in
rate given by the Association of Carriers and Equipment Lessors writing; and
(ACEL), Inc., and which was also used as basis by CIAC in granting
the costs for equipment on standby, was ₱1,982,271.60 per month of (2) The additional price to be paid to the contractor has been
delay. Considering that PEA was in delay for 564 days or 18.2 months, determined in writing by both parties.
Uy is entitled to an additional award of ₱36,076,360.32. Accordingly,
he is entitled to an aggregate amount of ₱55,680,492.38 for the By this article, a written authorization from the owner is required
equipment rentals on standby. before the contractor can validly recover his claim. The evident
purpose of the provision is to avoid litigation for added costs incurred
As to the awards of ₱2,275,721.00, for the cost of idle manpower, and by reason of additions or changes in the original plan. Undoubtedly, it
₱6,050,165.05, for the construction of the nursery shade net area, we was adopted to serve as a safeguard or a substantive condition
find no reason to disturb the same, as Uy never raised this issue in his precedent to recovery.28
petition.
This provision is echoed in the Landscaping Contract, viz.:
Next, we resolve Uy’s claims for costs for additional hauling distance
of topsoil and for mobilization of water truck. ARTICLE IX
CHANGE OF WORK
The approved hauling cost of topsoil was only ₱12.00/kilometer or
₱120.00 for the 10 kms original source. Uy, however, claims that due xxxx
to the delay in delivery of work areas, the original source became
depleted; hence, he was constrained to haul topsoil from another 9.3. Under no circumstances shall PEA be held liable for the payment
source located at a much farther distance of 40 kms. Uy insists that the of change of work undertaken without the written approval of the PEA
exhaustion of topsoil at the original source was solely attributable to General Manager x x x.
the delay in the turnover of the project site. Thus, he claims from PEA
the increased cost of topsoil amounting to ₱37,780,200.00. ARTICLE X
EXTRA WORK
Article 1724 of the Civil Code provides:
xxxx
10.3. Under no circumstances shall PEA be held liable for the payment By proceeding to obtain topsoil up to a 40-kilometer radius without
of extra work undertaken without the written approval of the PEA written approval from the PEA general manager, Uy cannot claim the
General Manager to perform the said work. 29 additional cost he incurred.

Admittedly, EDC did not secure the required written approval of Uy further claims ₱19,625,000.00 for cost of mobilization of water
PEA’s general manager before obtaining the topsoil from a farther trucks. He asserts that PEA completely failed to provide the generator
source. As pointed out by the CIAC: sets necessary to undertake the watering and/or irrigation works for
the landscaping and construction activities. 32
There is no change order authorizing payment for the increased cost
upon which this claim is based. There is, therefore, no legal right based Uy, however, admitted that MDC had already installed a deep well in
upon contract (the landscaping agreement or a change order) that the project site, and EDC used it in its landscaping and construction
would impose such a liability upon [PEA]. In a lump sum contract, as activities.33 Under the contract, the operational costs of the deep well
that entered into by the parties, the matter of how the contractor had and its appurtenant accessories, including the generator sets, shall be
made [a] computation to arrive at [a] bid that he submits is completely borne by EDC:
irrelevant. The contract amount of delivered topsoil is ₱780.00 per
truckload of 5.5 cubic meters sourced from a distance of [10] km. or The CONTRACTOR shall shoulder all cost of electricity,
100 [meters]. There is nothing in Exhibit "L" or in the landscaping maintenance, repairs, replacement of parts, when needed, and all costs
contract (Exhibit "A") that would indicate an agreement of [PEA] to of operation of the deepwell/s, and its appurtenant accessories, i.e.
pay for the increase in hauling cost if the source of topsoil exceeds 10 generator sets, etc. (which are already existing at the project site,
kilometers. Corollarily, there is also nothing therein to show that constructed by another Contractor) while such deepwell/s are being
[PEA] would also be entitled to decrease said costs by paying less if used by CONTRACTOR herein for its landscaping and construction
the distance would have been less than 10 kilometers. Had there been activities. These [deepwells] shall be turned over to PEA by
such a counterpart provision, there might have been more arguable CONTRACTOR in good operating/usable condition as when it was
claim for [Uy]. Unfortunately, no such provision exists. 30 first used by CONTRACTOR.34

In Powton Conglomerate, Inc. v. Agcolicol,31 we emphasized: Thus, Uy cannot claim additional cost for providing generator sets.

The written consent of the owner to the increased costs sought by the Uy also attempts to justify his claim for cost of mobilization of water
respondent is not a mere formal requisite, but a vital precondition to trucks by alleging that the water from the deep well provided by MDC
the validity of a subsequent contract authorizing a higher or additional and PEA was grossly insufficient to undertake the watering works for
contract price. Moreover, the safeguards enshrined in the provisions the project; hence, he was constrained to mobilize water trucks to save
of Article 1724 are not only intended to obviate future the plants from dying.
misunderstandings but also to give the parties a chance to decide
whether to bind one’s self to or withdraw from a contract. Indisputably, Uy mobilized water trucks for the landscaping projects
and, certainly, incurred additional costs. But like his claim for
additional cost of topsoil, such additional expenses were incurred
without prior written approval of PEA’s general manager. Thus, he to the CIAC and the CA for reducing the stipulated attorney’s fees
cannot claim payment for such cost from PEA. from 20% to 10% of the total amount due.

As aptly said by the CIAC: Paragraph 24.4 of the agreement provides:

Since [Uy] had presumably intended all along to charge [PEA] for the Should the PEA be constrained to resort to judicial or quasi-judicial
water truck operating costs, considering the very substantial amount relief to enforce or safeguard its rights and interests under this
of his claim, the prudence that he presumably has, as an experienced Agreement, the CONTRACTOR if found by the court or [the] quasi-
general contractor of the highest triple A category, should have judicial body, as the case [may be], to have been at fault, shall be liable
dictated that he negotiate with the [PEA] for a change order or an extra to PEA for attorney’s fees in an amount equivalent to twenty percent
work order before continuing to spend the huge amounts that he claims (20%) of the total [amount] claimed in the complaint, exclusive of
to have spent. [Uy] did just that in relation to his much smaller claim [any] damages and costs of suit.36
for the construction of the nursery shade x x x. He, however, made no
effort to negotiate with the PEA for a similar change order or extra Clearly, the cited provision cannot support Uy’s insistence. Paragraph
work order to safeguard his even bigger additional costs to operate the 24.4 on stipulated attorney’s fees is applicable only in complaints filed
water trucks. No explanation was offered for such a mystifying by PEA against the contractor. The provision is silent on the amount
differential treatment. He cannot, therefore, pass on without any of attorney’s fees that can be recovered from PEA.
contractual basis, such additional costs to the [PEA].
Besides, even assuming that Paragraph 24.4 is applicable, the amount
Neither can we hold PEA liable based on solutio indebiti, the legal of attorney’s fees may be reduced if found to be iniquitous or
maxim that no one should enrich itself at the expense of another. As unconscionable. Thus:
we explained in Powton Conglomerate, Inc. v. Agcolicol, 35
Articles 1229 and 2227 of the Civil Code empower the courts to
the principle of unjust enrichment cannot be validly invoked by the reduce the penalty if it is iniquitous or unconscionable. The
respondent who, through his own act or omission, took the risk of determination of whether the penalty is iniquitous or unconscionable
being denied payment for additional costs by not giving the petitioners is addressed to the sound discretion of the court and depends on
prior notice of such costs and/or by not securing their written consent several factors such as the type, extent, and purpose of the penalty, the
thereto, as required by law and their contract. nature of the obligation, the mode of breach and its consequences. 37

Uy cannot, therefore, claim from PEA the costs of the additional The Court finds Uy’s claim for attorney's fees equivalent to 20% of
hauling distance of topsoil, and of the mobilization of water trucks. whatever amount is due and payable to be exorbitant. The CIAC and
the CA, therefore, correctly awarded 10% of the total amount due and
Uy also assails the grant of attorney’s fees equivalent to 10% of the payable as reasonable attorney’s fees.
total amount due. Citing paragraph 24.4 of the Landscaping and
Construction Agreement, Uy asserts entitlement to attorney’s fees of Finally, on the propriety of the writ of injunction.
twenty percent (20%) of the total amount claimed. He ascribes error
Uy asserts that the CA acted without or in excess of jurisdiction when final judgment as one of its requisites, which is not yet present under
it enjoined the proceedings in CIAC Case No. 03-2001, despite the the present circumstances.
fact that the said case is totally different from the instant case.
At this juncture, it bears stressing that the essence of forum shopping
By grave abuse of discretion is meant such capricious and whimsical is the filing of multiple suits involving the same parties for the same
exercise of judgment equivalent to lack of jurisdiction. Mere abuse of cause of action, either simultaneously or successively, for the purpose
discretion is not enough. It must be grave, as when it is exercised of obtaining a favorable judgment. Accordingly, based on Our holding
arbitrarily or despotically by reason of passion or personal hostility; that the final resolution of the instant petitions takes precedence as it
and such abuse must be so patent and so gross as to amount to an is the appropriate vehicle for litigating the issues between the parties,
evasion of a positive duty or to a virtual refusal to perform the duty now that the instant petitions before Us have come full circle with this
enjoined or to act at all in contemplation of law. 38 joint resolution and, if the parties herein so choose, may seek further
relief to the High Tribunal afterwards. We cannot allow CIAC CASE
The CA granted PEA’s prayer for the injunctive writ not without NO. 03-2001 to proceed because to do so would render inutile the
reason. We quote its Joint Resolution, viz.: proscriptions against forum shopping which is frowned upon in Our
jurisdiction. Hence, the grant of injunctive relief. This must be done,
[T]here is no question that Elpidio S. Uy’s amended complaint is or else a travesty of the efficient administration of justice would
based on the same Landscaping and Construction Agreement, as he lamentably result.39
himself admits. The claims pertinent thereto had already been
arbitrated and passed upon in CIAC CASE NO. 02-2000 and the Indeed, the assailed resolution shows no patent or gross error
decision therein was already elevated to Us for review and, in view of amounting to grave abuse of discretion. Neither does it show an
Our joint decision in the instant petitions, a reconsideration thereof. arbitrary or despotic exercise of power arising from passion or
hostility.
Based on the foregoing, We are inclined to grant the prayer of PEA to
enjoin the CIAC from further proceeding with CIAC CASE NO. 03- At this point, it should be stated that the Court is not convinced by
2001, considering that the allegations therein constrain Us to apply the Uy’s argument that the claims under CIAC Case No. 03-2001 are
doctrine of litis pendentia, which has for its requisites: (a) identity of different from his claims in CIAC Case No. 02-2000. There is only
parties, or at least such parties who represent the same interests in both one cause of action running through Uy’s litigious undertakings – his
actions; (b) identity of rights asserted and relief prayed for, the relief alleged right under the Landscaping and Construction Agreement.
being founded on the same facts; and (c) the identity with respect to Therefore, the landscaping agreement is indispensable in prosecuting
the two preceding particulars in the two (2) cases is such that any his claims in both CIAC Cases Nos. 02-2000 and 03-2001.
judgment that may be rendered in the pending case, regardless of
which party is successful, would amount to res judicata in the other As we held in Villanueva v. Court of Appeals:40
case. Forum shopping exists where the elements of litis pendentia are
present or where a final judgment in one case will amount to res A party, by varying the form or action or by bringing forward in a
judicata in the other. The principle of bar by prior judgment raised by second case additional parties or arguments, cannot escape the effects
the PEA, i.e., res judicata, finds application only upon a showing of a of the principle of res judicata when the facts remain the same at least
where such new parties or matter could have been impleaded or
pleaded in the prior action.

WHEREFORE, the petition is PARTIALLY GRANTED. The

assailed Joint Decision and Joint Resolution of the Court of Appeals
in CA-G.R. SP Nos. 59308 and 59849 are AFFIRMED with
MODIFICATIONS. Respondent Public Estates Authority is ordered
to pay Elpidio S. Uy, doing business under the name and style Edison
Development and Construction, ₱55,680,492.38 for equipment rentals
on standby; ₱2,275,721.00 for the cost of idle manpower; and
₱6,050,165.05 for the construction of the nursery shade net area; plus
interest at 6% per annum to be computed from the date of the filing of
the complaint until finality of this Decision and 12% per annum
thereafter until full payment. Respondent PEA is further ordered to
pay petitioner Uy 10% of the total award as attorney’s fees.

SO ORDERED.
G.R. NO. 192105 December 9, 2013 Petitioner began his stint as Mekeni Regional Sales Manager on March
17, 2004. To be able to effectively cover his appointed sales territory,
ANTONIO LOCSIN, II, Petitioner, Mekeni furnished petitioner with a used Honda Civic car valued at
vs. ₱280,000.00, which used to be the service vehicle of petitioner’s
MEKENI FOOD CORPORATION, Respondent. immediate supervisor. Petitioner paid for his 50% share through salary
deductions of ₱5,000.00 each month.
DECISION
Subsequently, Locsin resigned effective February 25, 2006. By then,
DEL CASTILLO, J.: a total of ₱112,500.00 had been deducted from his monthly salary and
applied as part of the employee’s share in the car plan. Mekeni
In the absence of specific terms and conditions governing a car plan supposedly put in an equivalent amount as its share under the car plan.
agreement between the employer and employe former may not retain In his resignation letter, petitioner made an offer to purchase his
the installment payments made by the latter on the car plan and treat service vehicle by paying the outstanding balance thereon. The parties
them as rents for the use of the service vehicle, in the event that the negotiated, but could not agree on the terms of the proposed purchase.
employee ceases his employment and is unable to complete the Petitioner thus returned the vehicle to Mekeni on May 2, 2006.
installment payments on the vehicle. The underlying reason is that the
service vehicle was precisely used in the former' s business; any Petitioner made personal and written follow-ups regarding his unpaid
personal benefit obtained by the employee from its use is merely salaries, commissions, benefits, and offer to purchase his service
incidental. This Petition for Review on Certiorari1 assails the January vehicle. Mekeni replied that the company car plan benefit applied only
27, 2010 Decision2 of the Court of Appeals (CA) in CA-G.R. SP No. to employees who have been with the company for five years; for this
109550, as well as its April 23, 2010 Resolution3 denying petitioner’s reason, the balance that petitioner should pay on his service vehicle
Motion for Partial Reconsideration.4 stood at ₱116,380.00 if he opts to purchase the same.

Factual Antecedents On May 3, 2007, petitioner filed against Mekeni and/or its President,
Prudencio S. Garcia, a Complaint6for the recovery of monetary claims
In February 2004, respondent Mekeni Food Corporation(Mekeni)–a consisting of unpaid salaries, commissions, sick/vacation leave
Philippine company engaged in food manufacturing and meat benefits, and recovery of monthly salary deductions which were
processing –offered petitioner Antonio Locsin II the position of earmarked for his cost-sharing in the car plan. The case was docketed
Regional Sales Manager to over see Mekeni’s National Capital Region in the National Labor Relations Commission(NLRC), National
Supermarket/Food Service and South Luzon operations. In addition to Capital Region(NCR), Quezon City as NLRC NCR CASE NO. 00-
a compensation and benefit package, Mekeni offered petitioner a car 05-04139-07.
plan, under which one-half of the cost of the vehicle is to be paid by
the company and the other half to be deducted from petitioner’s salary. On October 30, 2007, Labor Arbiter Cresencio G. Ramos rendered a
Mekeni’s offer was contained in an Offer Sheet 5 which was presented Decision,7 decreeing as follows: WHEREFORE, in the light of the
to petitioner. foregoing premises, judgment is hereby rendered directing
respondents to turn-over to complainant x x x the subject vehicle upon
the said complainant’s payment to them of the sum of ₱100,435.84.SO WHEREFORE, in the light of the foregoing premises, judgment is
ORDERED.8 Ruling of the National Labor Relations Commission On hereby rendered directing respondents to turn-over to complainant x x
appeal,9 the Labor Arbiter’s Decision was reversed in a February 27, xthe subject vehicle upon the said complainant’s payment to them of
2009 Decision10 of the NLRC, thus: WHEREFORE, premises the sum of ₱100,435.84.
considered, the appeal is hereby Granted. The assailed Decision dated
October 30, 2007 is hereby REVERSED and SET ASIDE and a new SO ORDERED.8
one entered ordering respondent-appellee Mekeni Food Corporation
to pay complainant-appellee the following: Ruling of the National Labor Relations Commission

1.Unpaid Salary in the amount of ₱12,511.45; On appeal,9 the Labor Arbiter’s Decision was reversedin a February
27, 2009 Decision10of the NLRC, thus:
2.Unpaid sick leave/vacation leave pay in the amount of
₱14,789.15; WHEREFORE, premises considered, the appeal is hereby Granted.
The assailed Decision dated October 30, 2007 is hereby REVERSED
3.Unpaid commission in the amount of ₱9,780.00; and and SET ASIDE and a new one entered ordering respondent-appellee
Mekeni Food Corporation to pay complainant-appellee the following:
4.Reimbursement of complainant’s payment under the car
plan agreement in the amount of ₱112,500.00; and 1.Unpaid Salary in the amount of ₱12,511.45;

5.The equivalent share of the company as part of the 2.Unpaid sick leave/vacation leave pay in the amount of
complainant’s benefit under the car plan 50/50 sharing ₱14,789.15;
amounting to ₱112,500.00.
3.Unpaid commission in the amount of ₱9,780.00; and
Respondent-Appellee Mekeni Food Corporation is hereby authorized
to deduct the sum of ₱4,736.50 representing complainant-appellant’s 4.Reimbursement of complainant’s payment under the car
cash advance from his total monetary award. plan agreement in the amount of ₱112,500.00; and

All other claims are dismissed for lack of merit. 5.The equivalent share of the company as part of the
complainant’s benefit under the car plan 50/50 sharing
SO ORDERED.11 The NLRC held that petitioner’s amortization amounting to ₱112,500.00.
payments on his service vehicle amounting to ₱112,500.00 should be
reimbursed; if not, unjust enrichment would result, as the vehicle Respondent-Appellee Mekeni Food Corporation is hereby authorized
remained in the possession and ownership of Mekeni. to deduct the sum of ₱4,736.50 representing complainant-appellant’s
cash advance from his total monetary award.
On October 30, 2007, Labor Arbiter Cresencio G. Ramos rendered a
Decision,7 decreeing as follows:
All other claims are dismissed for lack of merit. share in the amount of ₱112,500.00 are DELETED. The rest of the
decision is AFFIRMED.
SO ORDERED.11
SO ORDERED.14
The NLRC held that petitioner’s amortization payments on his service
vehicle amounting to ₱112,500.00 should be reimbursed; if not, unjust In arriving at the above conclusion, the CA held that the NLRC
enrichment would result, as the vehicle remained in the possession and possessed jurisdiction over petitioner’s claims, including the amounts
ownership of Mekeni. he paid under the car plan, since his Complaint against Mekeni is one
for the payment of salaries and employee benefits. With regard to the
In addition, the employer’s share in the monthly car plan payments car plan arrangement, the CA applied the ruling in Elisco Tool
should likewise be awarded to petitioner because it forms part of the Manufacturing Corporation v. Court of Appeals, 15 where it was held
latter’s benefits under the car plan. It held further that Mekeni’s claim that –
that the company car plan benefit applied only to employees who have
been with the company for five years has not been substantiated by its First. Petitioner does not deny that private respondent Rolando Lantan
evidence, in which case the car plan agreement should be construed in acquired the vehicle in question under a car plan for executives of the
petitioner’s favor. Mekeni moved to reconsider, but in an April 30, Elizalde group of companies. Under a typical car plan, the company
2009 Resolution,12 the NLRC sustained its original findings. advances the purchase price of a car to be paid back by the employee
through monthly deductions from his salary. The company retains
Ruling of the Court of Appeals ownership of the motor vehicle until it shall have been fully paid for.
However, retention of registration of the car in the company’s name is
Mekeni filed a Petition for Certiorari13 with the CA assailing the only a form of a lien on the vehicle in the event that the employee
NLRC’s February 27, 2009 Decision, saying that the NLRC would abscond before he has fully paid for it. There are also
committed grave abuse of discretion in holding it liable to petitioner stipulations in car plan agreements to the effect that should the
as it had no jurisdiction to resolve petitioner’s claims, which are civil employment of the employee concerned be terminated before all
in nature. installments are fully paid, the vehicle will be taken by the employer
and all installments paid shall be considered rentals per agreement. 16
On January 27, 2010, the CA issued the assailed Decision, decreeing
as follows: In the absence of evidence as to the stipulations of the car plan
arrangement between Mekeni and petitioner, the CA treated
WHEREFORE, the petition for certiorari is GRANTED. The Decision petitioner’s monthly contributions in the total amount of ₱112,500.00
of the National Labor Relations Commission dated 27 February 2009, as rentals for the use of his service vehicle for the duration of his
in NLRC NCR Case No. 00-05-04139-07, and its Resolution dated 30 employment with Mekeni. The appellate court applied Articles 1484-
April 2009 denying reconsideration thereof, are MODIFIED in that 1486 of the Civil Code,17 and added that the installments paid by
the reimbursement of Locsin’s payment under the car plan in the petitioner should not be returned to him inasmuch as the amounts are
amount of ₱112,500.00, and the payment to him of Mekeni’s 50% not unconscionable. It made the following pronouncement:
Having used the car in question for the duration of his employment, it ₱112,500.00, as rentals for the use of his service vehicle during his
is but fair that all of Locsin’s payments be considered as rentals employment; the car plan which he availed ofwasa benefit and it
therefor which may be forfeited by Mekeni. Therefore, Mekeni has no formed part of the package of economic benefits granted to him when
obligation to return these payments to Locsin. Conversely, Mekeni has he was hired as Regional Sales Manager. Petitioner submits that this
no right to demand the payment of the balance of the purchase price is shown by the Offer Sheet which was shown to him and which
from Locsin since the latter has already surrendered possession of the became the basis for his decision to accept the offer and work for
vehicle.18 Mekeni.

Moreover, the CA held that petitioner cannot recover Mekeni’s Petitioner adds that the absence of documentary or other evidence
corresponding share in the purchase price of the service vehicle, as showing the terms and conditions of the Mekeni company car plan
this would constitute unjust enrichment on the part of petitioner at cannot justify a reliance on Mekeni’s self-serving claimsthat the full
Mekeni’s expense. terms thereof applied only to employees who have been with the
company for at least five years; in the absence of evidence, doubts
The CA affirmed the NLRC judgment in all other respects. Petitioner should be resolved in his favor pursuant to the policy of the law that
filed his Motion for Partial Reconsideration, 19 but the CA denied the affords protection to labor, as well asthe principle that all doubts
same in its April 23, 2010 Resolution. shouldbe construed to its benefit.

Thus, petitioner filed the instant Petition; Mekeni, on the other hand, Finally, petitioner submits that the ruling in the Elisco Tool casecannot
took no further action. apply to his case because the car plan subject of the said case involved
a car loan, which his car plan benefit was not; it was part of his
Issue compensation package, and the vehicle was an important component
of his work which required constant and uninterrupted mobility.
Petitioner raises the following solitary issue: Petitioner claims that the car plan was in fact more beneficial to
Mekeni than to him; besides, he did not choose to avail of it, as it was
WITH ALL DUE RESPECT, THE HONORABLE COURT OF simply imposed upon him. He concludes that it is only just that his
APPEALS ERRED IN NOT CONSIDERING THE CAR PLAN payments should be refunded and returned to him.
PRIVILEGE AS PART OF THE COMPENSATION PACKAGE
OFFERED TO PETITIONER AT THE INCEPTION OF HIS Petitioner thus prays for the reversal of the assailed CA Decision and
EMPLOYMENT AND INSTEAD LIKENED IT TO A CAR LOAN Resolution, and that the Court reinstate the NLRC’s February 27, 2009
ON INSTALLMENT, IN SPITE OF THE ABSENCE OF Decision.
EVIDENCE ONRECORD.20
Respondent’s Arguments
Petitioner’s Arguments
In its Comment,22 Mekeni argues that the Petition does not raise
In his Petition and Reply,21 petitioner mainly argues that the CA erred questions of law, but merely of fact, which thus requires the Court to
in treating his monthly contributions to the car plan, totaling review anew issues already passed upon by the CA – an unauthorized
exercise given that the Supreme Court is not a trier of facts, nor is it Indeed, there is no such stipulation or arrangement between them.
its function to analyze or weigh the evidence of the parties all over Thus, the CA’s reliance on Elisco Tool is without basis, and its
again.23 It adds that the issue regarding the car plan and the conclusions arrived at in the questioned decision are manifestly
conclusions of the CA drawn from the evidence on record are mistaken. To repeat what was said in Elisco Tool –
questions of fact.
First. Petitioner does not deny that private respondent Rolando Lantan
Mekeni asserts further that the service vehicle was merely a loan acquired the vehicle in question under a car plan for executives of the
which had to be paid through the monthly salary deductions.If it is not Elizalde group of companies. Under a typical car plan, the company
allowed to recover on the loan, this would constitute unjust enrichment advances the purchase price of a car to be paid back by the employee
on the part of petitioner. through monthly deductions from his salary. The company retains
ownership of the motor vehicle until it shall have been fully paid for.
Our Ruling However, retention of registration of the car in the company’s name is
only a form of a lien on the vehicle in the event that the employee
The Petition is partially granted. would abscond before he has fully paid for it. There are also
stipulations in car plan agreements to the effect that should the
To begin with, the Court notes that Mekeni did not file a similar employment of the employee concerned be terminated before all
petition questioning the CA Decision; thus, it is deemed to have installments are fully paid, the vehicle will be taken by the employer
accepted what was decreed. The only issue that must be resolved in and all installments paid shall be considered rentals per
this Petition, then, is whether petitioner is entitled to a refund of all the agreement.25 (Emphasis supplied)
amounts applied to the cost of the service vehicle under the car plan.
It was made clear in the above pronouncement that installments made
When the conclusions of the CA are grounded entirely on speculation, on the car plan may be treated as rentals only when there is an express
surmises and conjectures, or when the inferences made by it are stipulation in the car plan agreement to such effect. It was therefore
manifestly mistaken or absurd, its findings are subject to review by patent error for the appellate court to assume that, even in the absence
this Court.24 of express stipulation, petitioner’s payments on the car plan may be
considered as rentals which need not be returned.
From the evidence on record, it is seen that the Mekeni car plan offered
to petitioner was subject to no other term or condition than that Mekeni Indeed, the Court cannot allow that payments made on the car plan
shall cover one-half of its value, and petitioner shall in turn pay the should be forfeited by Mekeni and treated simply as rentals for
other half through deductions from his monthly salary.Mekeni has not petitioner’s use of the company service vehicle. Nor may they be
shown, by documentary evidence or otherwise, that there are other retained by it as purported loan payments, as it would have this Court
terms and conditions governing its car plan agreement with petitioner. believe. In the first place, there is precisely no stipulation to such effect
There is no evidence to suggest that if petitioner failed to completely in their agreement. Secondly, it may not be said that the car plan
cover one-half of the cost of the vehicle, then all the deductions from arrangement between the parties was a benefit that the petitioner
his salary going to the cost of the vehicle will be treated as rentals for enjoyed; on the contrary, it wasan absolute necessity in Mekeni’s
his use thereof while working with Mekeni, and shall not be refunded. business operations, which benefit edit to the fullest extent: without
the service vehicle, petitioner would have been unable to rapidly cover "[e]very person who through an act of performance by another, or any
the vast sales territory assigned to him, and sales or marketing of other means, acquires or comes into possession of something at the
Mekeni’s products could not have been booked or made fast enough expense of the latter without just or legal ground, shall return the same
to move Mekeni’s inventory. Poor sales, inability to market Mekeni’s to him." Article 214227of the same Code likewise clarifies that there
products, a high rate of product spoil age resulting from stagnant are certain lawful, voluntary and unilateral acts which give rise to the
inventory, and poor monitoring of the sales territory are the necessary juridical relation of quasi-contract, to the end that no one shall be
consequences of lack of mobility. Without a service vehicle, petitioner unjustly enriched or benefited at the expense of another. In the absence
would have been placed at the mercy of inefficient and unreliable of specific terms and conditions governing the car plan arrangement
public transportation; his official schedule would have been dependent between the petitioner and Mekeni, a quasi-contractual relation was
on the arrival and departure times of buses or jeeps, not to mention the created between them. Consequently, Mekeni may not enrich itself by
availability of seats in them. Clearly, without a service vehicle, charging petitioner for the use of its vehicle which is otherwise
Mekeni’s business could only prosper at a snail’s pace, if not absolutely necessaryto the full and effective promotion of its business.
completely paralyzed. Its cost of doing business would be higher as It may not, under the claim that petitioner’s payments constitute rents
well. The Court expressed just such a view in the past. Thus – for the use of the company vehicle, refuse to refund what petitioner
had paid, for the reasons that the car plan did not carry such a
In the case at bar, the disallowance of the subject car plan benefits condition; the subject vehicle is an old car that is substantially, if not
would hamper the officials in the performance of their functions to fully, depreciated; the car plan arrangement benefited Mekeni for the
promote and develop trade which requires mobility in the performance most part; and any personal benefit obtained by petitioner from using
of official business. Indeed, the car plan benefits are supportive of the the vehicle was merely incidental.
implementation of the objectives and mission of the agency relative to
the nature of its operation and responsive to the exigencies of the Conversely, petitioner cannot recover the monetary value of Mekeni’s
service. 26 (Emphasis supplied) Any benefit or privilege enjoyed by counterpart contribution to the cost of the vehicle; that is not property
petitioner from using the service vehicle was merely incidental and or money that belongs to him, nor was it intended to be given to him
insignificant, because for the most part the vehicle was under in lieu of the car plan. In other words, Mekeni’s share of the vehicle’s
Mekeni’s control and supervision. Free and complete disposal is given cost was not part of petitioner’s compensation package. To start with,
to the petitioner only after the vehicle’s cost is covered or paid in full. the vehicle is an asset that belonged to Mekeni. Just as Mekeni is
Until then, the vehicle remains at the beck and call of Mekeni. Given unjustly enriched by failing to refund petitioner’s payments, so should
the vast territory petitioner had to cover to be able to perform his work petitioner not be awarded the value of Mekeni’s counter part
effectively and generate business for his employer, the service vehicle contribution to the car plan, as this would unjustly enrich him at
was an absolute necessity, or else Mekeni’s business would suffer Mekeni’s expense.
adversely. Thus, it is clear that while petitioner was paying for half of
the vehicle’s value, Mekeni was reaping the full benefits from the use There is unjust enrichment ''when a person unjustly retains a benefit
thereof. to the loss of another, or when a person retains money or property of
another against the fundamental principles of justice, equity and good
In light of the foregoing, it is unfair to deny petitioner a refund of all conscience." The principle of unjust enrichment requires two
his contributions to the car plan. Under Article 22 of the Civil Code, conditions: (1) that a person is benefited without a valid basis or
justification, and (2) that such benefit is derived at the expense of
another. The main objective of the principle against unjust enrichment
is to prevent one from enriching himself at the expense of another
without just cause or consideration. x x x28

WHEREFORE, the Petition is GRANTED IN PART. The assailed

January 27, 2010 Decision and April 23, 2010 Resolution of the Court
of Appeals in CA-G.R. SP No. 109550 are MODIFIED, in that
respondent Mekeni Food Corporation is hereby ordered to REFUND
petitioner Antonio Locsin II's payments under the car plan agreement
in the total amount of₱112,500.00.

Thus, except for the counterpart or equivalent share of Mekeni Food

Corporation in the car plan agreement amounting to ₱112,500.00,
which is DELETED, the February 27, 2009 Decision of the National
Labor Relations Commission is affirmed in all respects.

SO ORDERED.
G.R. No. 98273 October 28, 1991 her body. On top of all this, she was paid only $120 per month and her
total salaries were given to her only three hours before her flight back
CLARITA V. CRUZ, petitioner, to Manila. This was after the plane she was supposed to take had left
vs. and she had to stay in the airport for 24 hours before her employer
NATIONAL LABOR RELATIONS COMMISSION (NLRC), finally heard her pleas and delivered her passport and ticket to her.
PHILIPPINE OVERSEAS EMPLOYMENT
ADMINISTRATION (POEA), EMS MANPOWER & In its answer and position paper, the private respondent raised the
PLACEMENT SERVICE (PHIL.), ABDUL KARIM AL principal defense of settlement as evidenced by the Affidavit of
YAHYA, and TRAVELLERS INSURANCE, respondents. Desistance executed by the complainant on June 21, 1988. In this
document, she declared inter alia that —
Public Attorney's Office for petitioner.
xxx xxx xxx
Manuel T. Collado for private respondent.
2. Thereafter going thoroughly over the facts of the case by
reconciling our records, we came to discover that it was only
a plain case of misunderstanding on our part, and that we have
already settled our differences;
CRUZ, J.:
3. That I am no longer interested in further continuance of the
Clarita V. Cruz** went abroad pursuant to an employment contract above case against EMS Manpower & Placement Services
that she hoped would improve her future. Although a high school either criminal, civil or administrative or whatever nature as I
graduate, she agreed to work as a domestic helper in Kuwait in hereby desist now and hereafter;
consideration of an attractive salary and vacation leave benefits she
could not expect to earn in this country. But her foreign adventure 4. That I am executing this affidavit of desistance to attest to
proved to be a bitter disappointment. On March 18,1988, after the truth of the foregoing facts and circumstances and for the
completing her two-year engagement, she was back home in the purpose of asking the dismissal of my said complaint against
Philippines with her dead dreams and an angry grievance. EMS Manpower & Placement Services.

On March 23,1988, she filed a complaint against EMS Manpower and On the basis of this affidavit, the Philippine Overseas Employment
Placement Services (Phil.) and its foreign principal, Abdul Karim Al Administration (POEA) dismissed her complaint in a decision dated
Yahya, for underpayment of her salary and non-payment of her May 16, 1989. This was affirmed by the National Labor Relations
vacation leave. She also claimed that she was charged a placement fee Commission (NLRC) in its resolution dated December 28, 1990,
of P7,000.00 instead of the legal maximum of only P5,000.00. She reconsideration of which was denied on February 21, 1991.
alleged that her foreign employer treated her as a slave and required
her to work 18 hours a day. She was beaten up and suffered facial The petition now before us faults the POEA and the NLRC with grave
deformity, head trauma and decreased sensation in the right portion of abuse of discretion for having upheld the Affidavit of Desistance. Cruz
rejects the settlement as having been obtained from her under duress execution of the instrument must also be sustained on the basis of the
and false pretenses and insists on her original claim for the balance of presumptions of regularity of official functions and of good faith.
her salaries and vacation- leave pay at the agreed rate of P250.00 per
month. Significantly, neither the private respondent nor the Solicitor General
refuted the petitioner's submission that the person who allegedly
Her contention is that she was inveigled into signing the Affidavit of assisted her in the execution of the Affidavit of Desistance and
Desistance without the assistance of counsel. The "Attorney" explained to her its content and meaning was not a lawyer but a mere
Alvarado who assisted her was not really a lawyer but only a helper in employee in the OWWA. His status was merely assumed but not
the Overseas Workers Welfare Administration. Atty. Biolena, on the established by the respondents although it was directly questioned.
other hand, merely acknowledged the document. Moreover, when she The comments of the public and private respondents did not meet this
signed the affidavit, she was under the impression when she was challenge squarely.
agreeing to settle only her claim for one month unpaid vacation leave,
as the wording of the receipt she issued on the same date showed, to It is no less noteworthy that the receipt the petitioner issued on the
wit: same day was only for "P2,400.00 . . . in settlement of 1 month unpaid
vacation." This clearly shows that she was not waiving the rest of her
June 21, 1988 demands in exchange for that measly amount (which did not even
really represent the commutable value of the 1 month vacation leave
Receipt at the rate of $250.00). In fact, the total claim of the petitioner is for
P88,840.00, itemized as follows:
This is to certify that I received the amount of P2,400.00 from EMS
Manpower & Placement Services in settlement of 1 month unpaid a) P84,240.00, representing the salary differentials of $130 for
vacation leave. 24 months (US $3,120.00 x P27.00).

(Sgd.) CLARITA V. CRUZ b) P2,600.00, representing the balance of her vacation leave
pay.
IN THE PRESENCE OF:
c) P2,000.00, representing her excess placement fee.
(Sgd.) O.G. ALVARADO
In Principe v. Philippine-Singapore Transport Service, Inc., 1 this
OWWA Legal Dept. Court held:

For its part, the private respondent argues that the petitioner is bound
by her Affidavit of Desistance, which she freely and knowingly
executed. After all, she was not an ignorant and illiterate person but a Even assuming for the sake of argument that the quitclaim had
high school graduate who understood what she was signing. The due foreclosed petitioner's right over the death benefits of her
husband, the fact that the consideration given in exchange
 thereof was very much less than the amount petitioner is for the unseemly settlement of only P2,400.00. And even if she did,
claiming renders the quitclaim null and void for being the waiver would still be null and void as violative of public policy.
contrary to public policy. The State must be firm in affording
protection to labor. The quitclaim wherein the consideration It remains to state that, contrary to the contention of the private
is scandalously low and inequitable cannot be an obstacle to respondent in the proceedings below that it has no privity of contract
petitioner's pursuing her legitimate claim. Equity dictates that with the petitioner, we have held in a long line of cases that the local
the compromise agreement should be voided in this instance. recruiter is solidarily liable with the foreign principal for all damages
(Emphasis supplied.) sustained by the overseas worker in connection with his contract of
employment. Such liability is provided for in Section 1, Rule II, Book
II, of the POEA Rules and Regulations, which we have consistently
sustained.
The following guidelines were likewise set in Periquet v. NLRC: 2
This decision demonstrates once again the tenderness of the Court
toward the worker subjected to the lawless exploitation and
impositions of his employer. The protection of our overseas workers
Not all waivers and quitclaims are invalid as against public is especially necessary because of the inconveniences and even risks
policy. If the agreement was voluntarily entered into and they have to undergo in their quest for a better life in a foreign land
represents a reasonable settlement, it is binding on the parties away from their loved ones and their own government.
and may not later be disowned simply because of a change of
mind. It is only where there is clear proof that the waiver was The domestic helper is particularly susceptible to abuse because she
wangled from an unsuspecting or gullible person, or the terms usually works only by herself in a private household unlike other
of settlement are unconscionable on its face, that the law will workers employed in an open business concern who are able to share
step in to annul the questionable transaction. (Emphasis and discuss their problems and bear or solve them together. The
supplied.) domestic helper is denied that comfort. She has no companions in her
misery. She usually broods alone. There is no one to turn to for help.
The Court is convinced that the petitioner was not fully aware of the That is why we must carefully listen to her when she is finally able to
import and consequences of the Affidavit of Desistance when she complain against those who would rob her of her just rewards and even
executed it, allegedly with the assistance of counsel. Except for the of her dignity as a human being.
disputable presumptions invoked by the private respondent, such
assistance has not been established against the petitioner's allegation WHEREFORE, the resolutions of the NLRC dated December 28,
that the "Attorney" Alvarado who supposedly counseled her was not 1990, and February 21, 1991, are SET ASIDE, and the Affidavit of
even a lawyer. Indeed, even assuming that such assistance had been Desistance is DECLARED null and void. POEA Case No. 88-03-255
duly given, there is still the question of the intrinsic validity of the is REMANDED to the POEA for further proceedings and expeditious
quitclaim in view of the gross disparity between the amount of the resolution.
settlement and the petitioner's original claim. It is difficult to believe
that the petitioner would agree to waive her total claim of P88,840.00 SO ORDERED.
G.R. No. L-16439 July 20, 1961 proved to be inconvenient, she had herself aborted again by
the defendant in October 1953. Less than two years later, she
ANTONIO GELUZ, petitioner, again became pregnant. On February 21, 1955, accompanied
vs. by her sister Purificacion and the latter's daughter Lucida, she
THE HON. COURT OF APPEALS and OSCAR again repaired to the defendant's clinic on Carriedo and P.
LAZO, respondents. Gomez streets in Manila, where the three met the defendant
and his wife. Nita was again aborted, of a two-month old
Mariano H. de Joya for petitioner. foetus, in consideration of the sum of fifty pesos, Philippine
A.P. Salvador for respondents. currency. The plaintiff was at this time in the province of
Cagayan, campaigning for his election to the provincial board;
REYES, J.B.L., J.: he did not know of, nor gave his consent, to the abortion.

This petition for certiorari brings up for review question whether the It is the third and last abortion that constitutes plaintiff's basis in filing
husband of a woman, who voluntarily procured her abortion, could this action and award of damages. Upon application of the defendant
recover damages from physician who caused the same. Geluz we granted certiorari.

The litigation was commenced in the Court of First Instance of Manila The Court of Appeals and the trial court predicated the award of
by respondent Oscar Lazo, the of Nita Villanueva, against petitioner damages in the sum of P3,000.06 upon the provisions of the initial
Antonio Geluz, a physician. Convinced of the merits of the complaint paragraph of Article 2206 of the Civil Code of the Philippines. This
upon the evidence adduced, the trial court rendered judgment favor of we believe to be error, for the said article, in fixing a minimum award
plaintiff Lazo and against defendant Geluz, ordering the latter to pay of P3,000.00 for the death of a person, does not cover the case of an
P3,000.00 as damages, P700.00 attorney's fees and the costs of the unborn foetus that is not endowed with personality. Under the system
suit. On appeal, Court of Appeals, in a special division of five, of our Civil Code, "la criatura abortiva no alcanza la categoria de
sustained the award by a majority vote of three justices as against two, persona natural y en consscuencia es un ser no nacido a la vida del
who rendered a separate dissenting opinion. Derecho" (Casso-Cervera, "Diccionario de Derecho Privado", Vol. 1,
p. 49), being incapable of having rights and obligations.
The facts are set forth in the majority opinion as follows:
Since an action for pecuniary damages on account of personal injury
Nita Villanueva came to know the defendant (Antonio Geluz) or death pertains primarily to the one injured, it is easy to see that if
no action for such damages could be instituted on behalf of the unborn
for the first time in 1948 — through her aunt Paula Yambot.
In 1950 she became pregnant by her present husband before child on account of the injuries it received, no such right of action
they were legally married. Desiring to conceal her pregnancy could derivatively accrue to its parents or heirs. In fact, even if a cause
from her parent, and acting on the advice of her aunt, she had of action did accrue on behalf of the unborn child, the same was
herself aborted by the defendant. After her marriage with the extinguished by its pre-natal death, since no transmission to anyone
plaintiff, she again became pregnant. As she was then can take place from on that lacked juridical personality (or juridical
employed in the Commission on Elections and her pregnancy capacity as distinguished from capacity to act). It is no answer to
invoke the provisional personality of a conceived child (conceptus pro abortion, the appellee does not seem to have taken interest in the
nato habetur) under Article 40 of the Civil Code, because that same administrative and criminal cases against the appellant. His only
article expressly limits such provisional personality by imposing the concern appears to have been directed at obtaining from the doctor a
condition that the child should be subsequently born alive: "provided large money payment, since he sued for P50,000.00 damages and
it be born later with the condition specified in the following article". P3,000.00 attorney's fees, an "indemnity" claim that, under the
In the present case, there is no dispute that the child was dead when circumstances of record, was clearly exaggerated.
separated from its mother's womb.
The dissenting Justices of the Court of Appeals have aptly remarked
The prevailing American jurisprudence is to the same effect; and it is that:
generally held that recovery can not had for the death of an unborn
child (Stafford vs. Roadway Transit Co., 70 F. Supp. 555; Dietrich vs. It seems to us that the normal reaction of a husband who
Northampton, 52 Am. Rep. 242; and numerous cases collated in the righteously feels outraged by the abortion which his wife has
editorial note, 10 ALR, (2d) 639). deliberately sought at the hands of a physician would be
highminded rather than mercenary; and that his primary
This is not to say that the parents are not entitled to collect any concern would be to see to it that the medical profession was
damages at all. But such damages must be those inflicted directly upon purged of an unworthy member rather than turn his wife's
them, as distinguished from the injury or violation of the rights of the indiscretion to personal profit, and with that idea in mind to
deceased, his right to life and physical integrity. Because the parents press either the administrative or the criminal cases he had
can not expect either help, support or services from an unborn child, filed, or both, instead of abandoning them in favor of a civil
they would normally be limited to moral damages for the illegal arrest action for damages of which not only he, but also his wife,
of the normal development of the spes hominis that was the foetus, would be the beneficiaries.
i.e., on account of distress and anguish attendant to its loss, and the
disappointment of their parental expectations (Civ. Code Art. 2217), It is unquestionable that the appellant's act in provoking the abortion
as well as to exemplary damages, if the circumstances should warrant of appellee's wife, without medical necessity to warrant it, was a
them (Art. 2230). But in the case before us, both the trial court and the criminal and morally reprehensible act, that can not be too severely
Court of Appeals have not found any basis for an award of moral condemned; and the consent of the woman or that of her husband does
damages, evidently because the appellee's indifference to the previous not excuse it. But the immorality or illegality of the act does not justify
abortions of his wife, also caused by the appellant herein, clearly an award of damage that, under the circumstances on record, have no
indicates that he was unconcerned with the frustration of his parental factual or legal basis.
hopes and affections. The lower court expressly found, and the
majority opinion of the Court of Appeals did not contradict it, that the The decision appealed from is reversed, and the complaint ordered
appellee was aware of the second abortion; and the probabilities are dismissed. Without costs.
that he was likewise aware of the first. Yet despite the suspicious
repetition of the event, he appeared to have taken no steps to
investigate or pinpoint the causes thereof, and secure the punishment
of the responsible practitioner. Even after learning of the third
G.R. No. L-19671 November 29, 1965 born; they started saving money in a piggy bank. A few weeks before
their secret marriage, their engagement was broken; Vicenta returned
PASTOR B. TENCHAVEZ, plaintiff-appellant, the engagement ring and accepted another suitor, Joseling Lao. Her
vs. love for Pastor beckoned; she pleaded for his return, and they
VICENTA F. ESCAÑO, ET AL., defendants-appellees. reconciled. This time they planned to get married and then elope. To
facilitate the elopement, Vicenta had brought some of her clothes to
I. V. Binamira & F. B. Barria for plaintiff-appellant. the room of Pacita Noel in St. Mary's Hall, which was their usual
Jalandoni & Jarnir for defendants-appellees. trysting place.

REYES, J.B.L., J.: Although planned for the midnight following their marriage, the
elopement did not, however, materialize because when Vicente went
Direct appeal, on factual and legal questions, from the judgment of the back to her classes after the marriage, her mother, who got wind of the
Court of First Instance of Cebu, in its Civil Case No. R-4177, denying intended nuptials, was already waiting for her at the college. Vicenta
the claim of the plaintiff-appellant, Pastor B. Tenchavez, for legal was taken home where she admitted that she had already married
separation and one million pesos in damages against his wife and Pastor. Mamerto and Mena Escaño were surprised, because Pastor
parents-in-law, the defendants-appellees, Vicente, Mamerto and never asked for the hand of Vicente, and were disgusted because of
Mena,1 all surnamed "Escaño," respectively.2 the great scandal that the clandestine marriage would provoke (t.s.n.,
vol. III, pp. 1105-06). The following morning, the Escaño spouses
sought priestly advice. Father Reynes suggested a recelebration to
The facts, supported by the evidence of record, are the following:
validate what he believed to be an invalid marriage, from the
standpoint of the Church, due to the lack of authority from the
Missing her late afternoon classes on 24 February 1948 in the
Archbishop or the parish priest for the officiating chaplain to celebrate
University of San Carlos, Cebu City, where she was then enrolled as
the marriage. The recelebration did not take place, because on 26
a second year student of commerce, Vicenta Escaño, 27 years of age
February 1948 Mamerto Escaño was handed by a maid, whose name
(scion of a well-to-do and socially prominent Filipino family of
he claims he does not remember, a letter purportedly coming from San
Spanish ancestry and a "sheltered colegiala"), exchanged marriage
Carlos college students and disclosing an amorous relationship
vows with Pastor Tenchavez, 32 years of age, an engineer, ex-army
between Pastor Tenchavez and Pacita Noel; Vicenta translated the
officer and of undistinguished stock, without the knowledge of her
letter to her father, and thereafter would not agree to a new marriage.
parents, before a Catholic chaplain, Lt. Moises Lavares, in the house
Vicenta and Pastor met that day in the house of Mrs. Pilar Mendezona.
of one Juan Alburo in the said city. The marriage was the culmination
Thereafter, Vicenta continued living with her parents while Pastor
of a previous love affair and was duly registered with the local civil
returned to his job in Manila. Her letter of 22 March 1948 (Exh. "M"),
register. while still solicitous of her husband's welfare, was not as endearing as
her previous letters when their love was aflame.
Vicenta's letters to Pastor, and his to her, before the marriage, indicate
that the couple were deeply in love. Together with a friend, Pacita
Vicenta was bred in Catholic ways but is of a changeable disposition,
Noel, their matchmaker and go-between, they had planned out their
and Pastor knew it. She fondly accepted her being called a "jellyfish."
marital future whereby Pacita would be the governess of their first-
She was not prevented by her parents from communicating with Pastor affections, and against the Roman Catholic Church, for having,
(Exh. "1-Escaño"), but her letters became less frequent as the days through its Diocesan Tribunal, decreed the annulment of the marriage,
passed. As of June, 1948 the newlyweds were already estranged (Exh. and asked for legal separation and one million pesos in damages.
"2-Escaño"). Vicenta had gone to Jimenez, Misamis Occidental, to Vicenta claimed a valid divorce from plaintiff and an equally valid
escape from the scandal that her marriage stirred in Cebu society. marriage to her present husband, Russell Leo Moran; while her parents
There, a lawyer filed for her a petition, drafted by then Senator denied that they had in any way influenced their daughter's acts, and
Emmanuel Pelaez, to annul her marriage. She did not sign the petition counterclaimed for moral damages.
(Exh. "B-5"). The case was dismissed without prejudice because of
her non-appearance at the hearing (Exh. "B-4"). The appealed judgment did not decree a legal separation, but freed the
plaintiff from supporting his wife and to acquire property to the
On 24 June 1950, without informing her husband, she applied for a exclusion of his wife. It allowed the counterclaim of Mamerto Escaño
passport, indicating in her application that she was single, that her and Mena Escaño for moral and exemplary damages and attorney's
purpose was to study, and she was domiciled in Cebu City, and that fees against the plaintiff-appellant, to the extent of P45,000.00, and
she intended to return after two years. The application was approved, plaintiff resorted directly to this Court.
and she left for the United States. On 22 August 1950, she filed a
verified complaint for divorce against the herein plaintiff in the The appellant ascribes, as errors of the trial court, the following:
Second Judicial District Court of the State of Nevada in and for the
County of Washoe, on the ground of "extreme cruelty, entirely mental 1. In not declaring legal separation; in not holding defendant
in character." On 21 October 1950, a decree of divorce, "final and Vicenta F. Escaño liable for damages and in dismissing the
absolute", was issued in open court by the said tribunal. complaint;.

In 1951 Mamerto and Mena Escaño filed a petition with the 2. In not holding the defendant parents Mamerto Escano and
Archbishop of Cebu to annul their daughter's marriage to Pastor (Exh. the heirs of Doña Mena Escaño liable for damages;.
"D"). On 10 September 1954, Vicenta sought papal dispensation of
her marriage (Exh. "D"-2). 3 In holding the plaintiff liable for and requiring him to pay
the damages to the defendant parents on their counterclaims;
On 13 September 1954, Vicenta married an American, Russell Leo and.
Moran, in Nevada. She now lives with him in California, and, by him,
has begotten children. She acquired American citizenship on 8 August 4. In dismissing the complaint and in denying the relief sought
1958. by the plaintiff.

But on 30 July 1955, Tenchavez had initiated the proceedings at bar That on 24 February 1948 the plaintiff-appellant, Pastor Tenchavez,
by a complaint in the Court of First Instance of Cebu, and amended on and the defendant-appellee, Vicenta Escaño, were validly married to
31 May 1956, against Vicenta F. Escaño, her parents, Mamerto and each other, from the standpoint of our civil law, is clearly established
Mena Escaño, whom he charged with having dissuaded and by the record before us. Both parties were then above the age of
discouraged Vicenta from joining her husband, and alienating her majority, and otherwise qualified; and both consented to the marriage,
which was performed by a Catholic priest (army chaplain Lavares) in Defendant Vicenta Escaño argues that when she contracted the
the presence of competent witnesses. It is nowhere shown that said marriage she was under the undue influence of Pacita Noel, whom she
priest was not duly authorized under civil law to solemnize marriages. charges to have been in conspiracy with appellant Tenchavez. Even
granting, for argument's sake, the truth of that contention, and
The chaplain's alleged lack of ecclesiastical authorization from the assuming that Vicenta's consent was vitiated by fraud and undue
parish priest and the Ordinary, as required by Canon law, is irrelevant influence, such vices did not render her marriage ab initio void, but
in our civil law, not only because of the separation of Church and State merely voidable, and the marriage remained valid until annulled by a
but also because Act 3613 of the Philippine Legislature (which was competent civil court. This was never done, and admittedly, Vicenta's
the marriage law in force at the time) expressly provided that — suit for annulment in the Court of First Instance of Misamis was
dismissed for non-prosecution.
SEC. 1. Essential requisites. Essential requisites for marriage
are the legal capacity of the contracting parties and consent. It is equally clear from the record that the valid marriage between
(Emphasis supplied) Pastor Tenchavez and Vicenta Escaño remained subsisting and
undissolved under Philippine law, notwithstanding the decree of
The actual authority of the solemnizing officer was thus only a formal absolute divorce that the wife sought and obtained on 21 October 1950
requirement, and, therefore, not essential to give the marriage civil from the Second Judicial District Court of Washoe County, State of
effects,3 and this is emphasized by section 27 of said marriage act, Nevada, on grounds of "extreme cruelty, entirely mental in character."
which provided the following: At the time the divorce decree was issued, Vicenta Escaño, like her
husband, was still a Filipino citizen.4 She was then subject to
SEC. 27. Failure to comply with formal requirements. No Philippine law, and Article 15 of the Civil Code of the Philippines
marriage shall be declared invalid because of the absence of (Rep. Act No. 386), already in force at the time, expressly provided:
one or several of the formal requirements of this Act if, when
it was performed, the spouses or one of them believed in good Laws relating to family rights and duties or to the status,
faith that the person who solemnized the marriage was condition and legal capacity of persons are binding upon the
actually empowered to do so, and that the marriage was citizens of the Philippines, even though living abroad.
perfectly legal.
The Civil Code of the Philippines, now in force, does not admit
The good faith of all the parties to the marriage (and hence the validity absolute divorce, quo ad vinculo matrimonii; and in fact does not even
of their marriage) will be presumed until the contrary is positively use that term, to further emphasize its restrictive policy on the matter,
proved (Lao vs. Dee Tim, 45 Phil. 739, 745; Francisco vs. Jason, 60 in contrast to the preceding legislation that admitted absolute divorce
Phil. 442, 448). It is well to note here that in the case at bar, doubts as on grounds of adultery of the wife or concubinage of the husband (Act
to the authority of the solemnizing priest arose only after the marriage, 2710). Instead of divorce, the present Civil Code only provides
when Vicenta's parents consulted Father Reynes and the archbishop of for legal separation (Title IV, Book 1, Arts. 97 to 108), and, even in
Cebu. Moreover, the very act of Vicenta in abandoning her original that case, it expressly prescribes that "the marriage bonds shall not be
action for annulment and subsequently suing for divorce implies an severed" (Art. 106, subpar. 1).
admission that her marriage to plaintiff was valid and binding.
For the Philippine courts to recognize and give recognition or effect constitute, contrary to her claim, adequate excuse. Wherefore, her
to a foreign decree of absolute divorce betiveen Filipino citizens could marriage and cohabitation with Russell Leo Moran is technically
be a patent violation of the declared public policy of the state, specially "intercourse with a person not her husband" from the standpoint of
in view of the third paragraph of Article 17 of the Civil Code that Philippine Law, and entitles plaintiff-appellant Tenchavez to a decree
prescribes the following: of "legal separation under our law, on the basis of adultery" (Revised
Penal Code, Art. 333).
Prohibitive laws concerning persons, their acts or property,
and those which have for their object public order, policy and The foregoing conclusions as to the untoward effect of a marriage after
good customs, shall not be rendered ineffective by laws or an invalid divorce are in accord with the previous doctrines and rulings
judgments promulgated, or by determinations or conventions of this court on the subject, particularly those that were rendered under
agreed upon in a foreign country. our laws prior to the approval of the absolute divorce act (Act 2710 of
the Philippine Legislature). As a matter of legal history, our statutes
Even more, the grant of effectivity in this jurisdiction to such foreign did not recognize divorces a vinculo before 1917, when Act 2710
divorce decrees would, in effect, give rise to an irritating and became effective; and the present Civil Code of the Philippines, in
scandalous discrimination in favor of wealthy citizens, to the disregarding absolute divorces, in effect merely reverted to the
detriment of those members of our polity whose means do not permit policies on the subject prevailing before Act 2710. The rulings,
them to sojourn abroad and obtain absolute divorces outside the therefore, under the Civil Code of 1889, prior to the Act above-
Philippines. mentioned, are now, fully applicable. Of these, the decision in Ramirez
vs. Gmur, 42 Phil. 855, is of particular interest. Said this Court in that
From this point of view, it is irrelevant that appellant Pastor Tenchavez case:
should have appeared in the Nevada divorce court. Primarily because
the policy of our law cannot be nullified by acts of private parties As the divorce granted by the French Court must be ignored,
(Civil Code,Art. 17, jam quot.); and additionally, because the mere it results that the marriage of Dr. Mory and Leona Castro,
appearance of a non-resident consort cannot confer jurisdiction where celebrated in London in 1905, could not legalize their
the court originally had none (Area vs. Javier, 95 Phil. 579). relations; and the circumstance that they afterwards passed for
husband and wife in Switzerland until her death is wholly
From the preceding facts and considerations, there flows as a without legal significance. The claims of the very children to
necessary consequence that in this jurisdiction Vicenta Escaño's participate in the estate of Samuel Bishop must therefore be
divorce and second marriage are not entitled to recognition as valid; rejected. The right to inherit is limited to legitimate,
for her previous union to plaintiff Tenchavez must be declared to be legitimated and acknowledged natural children. The children
existent and undissolved. It follows, likewise, that her refusal to of adulterous relations are wholly excluded. The word
perform her wifely duties, and her denial of consortium and her "descendants" as used in Article 941 of the Civil Code cannot
desertion of her husband constitute in law a wrong caused through her be interpreted to include illegitimates born
fault, for which the husband is entitled to the corresponding indemnity of adulterous relations. (Emphasis supplied)
(Civil Code, Art. 2176). Neither an unsubstantiated charge of deceit
nor an anonymous letter charging immorality against the husband
Except for the fact that the successional rights of the children, begotten asked for her hand, as good manners and breeding demanded. Even
from Vicenta's marriage to Leo Moran after the invalid divorce, are after learning of the clandestine marriage, and despite their shock at
not involved in the case at bar, the Gmur case is authority for the such unexpected event, the parents of Vicenta proposed and arranged
proposition that such union is adulterous in this jurisdiction, and, that the marriage be recelebrated in strict conformity with the canons
therefore, justifies an action for legal separation on the part of the of their religion upon advice that the previous one was canonically
innocent consort of the first marriage, that stands undissolved in defective. If no recelebration of the marriage ceremony was had it was
Philippine law. In not so declaring, the trial court committed error. not due to defendants Mamerto Escaño and his wife, but to the refusal
of Vicenta to proceed with it. That the spouses Escaño did not seek to
True it is that our ruling gives rise to anomalous situations where the compel or induce their daughter to assent to the recelebration but
status of a person (whether divorced or not) would depend on the respected her decision, or that they abided by her resolve, does not
territory where the question arises. Anomalies of this kind are not new constitute in law an alienation of affections. Neither does the fact that
in the Philippines, and the answer to them was given in Barretto vs. Vicenta's parents sent her money while she was in the United States;
Gonzales, 58 Phil. 667: for it was natural that they should not wish their daughter to live in
penury even if they did not concur in her decision to divorce
The hardship of the existing divorce laws in the Philippine Tenchavez (27 Am. Jur. 130-132).
Islands are well known to the members of the Legislature. It
is the duty of the Courts to enforce the laws of divorce as There is no evidence that the parents of Vicenta, out of improper
written by Legislature if they are constitutional. Courts have motives, aided and abetted her original suit for annulment, or her
no right to say that such laws are too strict or too liberal. (p. subsequent divorce; she appears to have acted independently, and
72) being of age, she was entitled to judge what was best for her and ask
that her decisions be respected. Her parents, in so doing, certainly
The appellant's first assignment of error is, therefore, sustained. cannot be charged with alienation of affections in the absence of
malice or unworthy motives, which have not been shown, good faith
However, the plaintiff-appellant's charge that his wife's parents, Dr. being always presumed until the contrary is proved.
Mamerto Escaño and his wife, the late Doña Mena Escaño, alienated
the affections of their daughter and influenced her conduct toward her SEC. 529. Liability of Parents, Guardians or Kin. — The law
husband are not supported by credible evidence. The testimony of distinguishes between the right of a parent to interest himself
Pastor Tenchavez about the Escaño's animosity toward him strikes us in the marital affairs of his child and the absence of rights in
to be merely conjecture and exaggeration, and are belied by Pastor's a stranger to intermeddle in such affairs. However, such
own letters written before this suit was begun (Exh. "2-Escaño" and distinction between the liability of parents and that of
"Vicenta," Rec. on App., pp. 270-274). In these letters he expressly strangers is only in regard to what will justify interference. A
apologized to the defendants for "misjudging them" and for the "great parent isliable for alienation of affections resulting from his
unhappiness" caused by his "impulsive blunders" and "sinful pride," own malicious conduct, as where he wrongfully entices his
"effrontery and audacity" [sic]. Plaintiff was admitted to the Escaño son or daughter to leave his or her spouse, but he is not liable
house to visit and court Vicenta, and the record shows nothing to prove unless he acts maliciously, without justification and from
that he would not have been accepted to marry Vicente had he openly unworthy motives. He is not liable where he acts and advises
 his child in good faith with respect to his child's marital unable to remarry under our law, this fact is a consequence of the
relations in the interest of his child as he sees it, the marriage indissoluble character of the union that appellant entered into
of his child not terminating his right and liberty to interest voluntarily and with open eyes rather than of her divorce and her
himself in, and be extremely solicitous for, his child's welfare second marriage. All told, we are of the opinion that appellant should
and happiness, even where his conduct and advice suggest or recover P25,000 only by way of moral damages and attorney's fees.
result in the separation of the spouses or the obtaining of a
divorce or annulment, or where he acts under mistake or With regard to the P45,000 damages awarded to the defendants, Dr.
misinformation, or where his advice or interference are Mamerto Escaño and Mena Escaño, by the court below, we opine that
indiscreet or unfortunate, although it has been held that the the same are excessive. While the filing of this unfounded suit must
parent is liable for consequences resulting from recklessness. have wounded said defendants' feelings and caused them anxiety, the
He may in good faith take his child into his home and afford same could in no way have seriously injured their reputation, or
him or her protection and support, so long as he has not otherwise prejudiced them, lawsuits having become a common
maliciously enticed his child away, or does not maliciously occurrence in present society. What is important, and has been
entice or cause him or her to stay away, from his or her spouse. correctly established in the decision of the court below, is that said
This rule has more frequently been applied in the case of defendants were not guilty of any improper conduct in the whole
advice given to a married daughter, but it is equally applicable deplorable affair. This Court, therefore, reduces the damages awarded
in the case of advice given to a son. to P5,000 only.

Plaintiff Tenchavez, in falsely charging Vicenta's aged parents with Summing up, the Court rules:
racial or social discrimination and with having exerted efforts and
pressured her to seek annulment and divorce, unquestionably caused (1) That a foreign divorce between Filipino citizens, sought and
them unrest and anxiety, entitling them to recover damages. While this decreed after the effectivity of the present Civil Code (Rep. Act 386),
suit may not have been impelled by actual malice, the charges were is not entitled to recognition as valid in this jurisdiction; and neither is
certainly reckless in the face of the proven facts and circumstances. the marriage contracted with another party by the divorced consort,
Court actions are not established for parties to give vent to their subsequently to the foreign decree of divorce, entitled to validity in
prejudices or spleen. the country;

In the assessment of the moral damages recoverable by appellant (2) That the remarriage of divorced wife and her co-habitation with a
Pastor Tenchavez from defendant Vicente Escaño, it is proper to take person other than the lawful husband entitle the latter to a decree of
into account, against his patently unreasonable claim for a million legal separation conformably to Philippine law;
pesos in damages, that (a) the marriage was celebrated in secret, and
its failure was not characterized by publicity or undue humiliation on (3) That the desertion and securing of an invalid divorce decree by one
appellant's part; (b) that the parties never lived together; and (c) that consort entitles the other to recover damages;
there is evidence that appellant had originally agreed to the annulment
of the marriage, although such a promise was legally invalid, being
against public policy (cf. Art. 88, Civ. Code). While appellant is
(4) That an action for alienation of affections against the parents of
one consort does not lie in the absence of proof of malice or unworthy
motives on their part.

WHEREFORE, the decision under appeal is hereby modified as

follows;

(1) Adjudging plaintiff-appellant Pastor Tenchavez entitled to a

decree of legal separation from defendant Vicenta F. Escaño;

(2) Sentencing defendant-appellee Vicenta Escaño to pay plaintiff-

appellant Tenchavez the amount of P25,000 for damages and
attorneys' fees;

(3) Sentencing appellant Pastor Tenchavez to pay the appellee,

Mamerto Escaño and the estate of his wife, the deceased Mena
Escaño, P5,000 by way of damages and attorneys' fees.

Neither party to recover costs.

G.R. No. L-18919 December 29, 1962 Province of Iloilo, Philippines; and that the respondent at the
time the acts hereinbelow complained of took place, was and
ABELARDO JAVELLANA, TOMAS JONCO, RUDICO still is the duly-elected and qualified Mayor of the
HABANA, EXEQUIEL GOLEZ, ALFREDO ANG, and Municipality of Buenavista, Province of Iloilo Philippines
FILIPINAS SOLEDAD, in their capacities as Councilors of the where he resides and may be served with summons.
Municipal Municipality of Buenavista, Province of
Iloilo, petitioners appellees, II
vs.
SUSANO TAYO, as Mayor of the Municipal Municipality of On February 8, 1960. the Municipal Council of the
Buenavista, Iloilo, respondent-appellant. Municipality of Buenavista, Iloilo, unanimously approved
Resolution No. 5, Series of 1960, dated February 8, 1960, a
Ramon A. Gonzales for petitioners-appellees. copy of which is hereto attached to form an integral part
Rico & Tiña for respondent-appellant. hereon as Annex 'A', which set the regular sessions of the
Municipality Council of Buenavista on every first and third
BARRERA, J.: Wednesday of every month, and which resolution was duly
approved by the respondent, in his capacity as Mayor of the
This is a direct appeal taken by respondent Susano Tayo (Mayor of the Municipality of Buenavista.
Municipality of Buenavista, Iloilo) from the decision of the Court of
First Instance of Iloilo (in Civil Case No. 5558, for mandamus) III
declaring legal and validity the regular session held by petitioners
Abelardo Javellano Tomas Jonco, Rudico Habana, Exequiel Golez, That on June 1, 1960, at the time and place set for the regular
Alfredo Ang, and Filipinas Soledad, constituting a majority of the session of the Municipal Council, the Mayor, Vice-Mayor,
elected councilors of said municipality, and ordering respondent to No. 1 and No. 2 Councilors, and the Secretary were absent.
give due course to the resolutions and or ordinances passed thereat,
and to sign the payrolls corresponding to the session days of June 1, IV
June 15, July 6, July 20, August 3, August 17, September 7, and
September 21, 1960 for payment of the per diems of petitioner as That the six councilors, who are the petitioners in this case,
councilors; to pay said Councilor Golez the sum of P100.00 as moral were present and they proceeded to elect among themselves a
damages; and to pay P100.00 as attorney' fees plus costs. temporary presiding officer and Acting Secretary to take notes
of the proceedings. Having thus elected a temporary presiding
The case was submitted on the following Stipulation of Facts: officer and a secretary of the Council, they proceeded to do
business.
I
V
That the petitioners are duly elected and qualified a members
of the Municipal Council of the Municipality of Buenavista,
That on June 15. 1960, at the time and place designated in payrolls; Provincial Forms No. 38(A) to the respondent
Resolution No. 5, series of 1960, dated February 8, 1960 Mayor for the latter signature, but that the respondent refused
above referred to, the petitioners acting as duly elected and to affix his signature to the payrolls thus presented, covering
qualified councilors were present and again, in view of the the per diems of the petitioner alleging that the proceedings
absence of the Mayor, Vice-Mayor said to councilor and the were illegal due to his absence.
Secretary proceeded to elect a temporary presiding officer and
temporary secretary from among them, and did business as a IX
Municipal Council of Buenavista.
That the petitioners, acting through Atty. Bartolome T. Tina,
VI addressed a letter dated August 8, 1960 to the Honorable
Provincial Fiscal of the Province of Iloilo, asking of the latter's
That again on July 6, and July 21, 1960, on August 3, and opinion on the validity of the acts of the herein petitioners,
August 17, September 7, and on September 21, 1960, the acting as the Municipal Council in the absence of the Mayor,
petitioners met at the place and time designated in Resolution Vice-Mayor, said two councilors and the secretary, a copy
No. 5, series of 1960, and proceeded to elect a temporary which letter is herewith attached as Annex 'B' and made an
Secretary among themselves, and did business as the integral part of this petition.
Municipal Council of Buenavista, in view again of the
absence of the Mayor Vice-Mayor, 2 councilors, and the X
Secretary.
That on August 9, 1960, the Honorable Provincial Fiscal of
VII the Province of Iloilo in his indorsement, rendered an opinion
upholding the validity of the controverted sessions of the
That when the minutes of the proceedings of June 1, June 15. Municipal Council, a copy, of which communication is,
July 6, July 20, August 17, September 7, and September 21, likewise attached herein is Annex 'C' and made an integral
1960 of the Municipal Council were presented to the part of this petition.
respondent for action, the respondent Mayor refused to act
upon said minutes, or particularly to approve or disapprove XI
the resolution as approved by the municipal Council, the
Mayor declaring the sessions above referred to as null and That despite the opinion of the Provincial Fiscal, the
void and not in accordance with. respondent Mayor refused and still refuses to act upon the
resolution petitions presented to him and to sign the payrolls
VIII covering the per diems of the herein petitioners.

That the petitioners made repeated demands for payment of XII

their per diems for the of June 1, June 15, July 6, July 20,
August 3, August 17, September 7, 1960, by representing the
 That the respondent brought the matter to the attention of the natural that they could validly hold a valid session, in order to
Provincial Board, of the Province of Iloilo, by means of a devise means for public interest.
letter questioning the legality of the minutes of the regular
possession of the Municipal Council without his presence The respondent here as Municipal Mayor should have given
individual that the Provincial Board resolved on September good example, by calling and attending regular session on the
23, 1960 to return the minutes of the regular session of the dates fixed by the Council. In the discharge of his of official
Municipal Council of Buenavista, Iloilo, informing the Mayor duty, he should consider the Session Hall of the Municipal
that per the opinion of the Legal Assistant, said minutes is Council as the sanctuary and depository of public interest and
legal. public welfare. Any member of the Council should enter the
Session Hall, not as a representative of any political part or
XIII group, but as a representative of the people of the municipality
whose interest and welfare should be safeguarded by the
That despite the resolution of the Provincial Board, the Mayor Council. In entering this Hall, he must lay aside his political
refused and still refuses to recognize the validity of the acts of affiliation, interest, and consideration, because it is the sworn
the Municipal Council and the legality of its regular session duty of every councilor to perform his duty with justice and
held in his absence. impartiality. Not to attend a meeting, constitutes an
abandonment of the people's welfare. One may be in the
On the basis of the foregoing Stipulation of Facts (plus the testimony minority group, but he can discharge his duty with honor and
of Councilor Exequiel Golez), the trial court (on July 26, 1961) prestige as a fiscalizer, to fiscalize the doings and actuations
rendered the decision above adverted to, partly stating: of the majority. He may be overwhelmed in his plan or project
by superior numerical majority but if he could adduce good
This Court, after perusal of all the records of this case has reasons and arguments in favor of the welfare of the people,
reached the conclusion that the sessions held by the petitioner his task as a fiscalizer is thereby attained. There is no fear on
during the absence of the respondent Mayor were perfectly attending any session because if your project is not carried
valid and legal. The attendance of the Mayor is not essential out, you may have the remedy, either by administrative or
to the validity of the session as long as there is quorum judicial relief, by questioning and ordinance or resolution
constituted in accordance with law. To declare that the passed by the majority, which may be null and void because
proceedings of the petitioners were null and void, is to they are excessive and unreasonable. So, there is no reason
encourage recalcitrant public officials who would frustrate why the respondent in this case had refused to attend the
valid session for political end or consideration. Public interest session of the Council.
will immensely suffer, if a mayor who belongs to one political
group refuses to call or attend a session, because the Council Petitioners here claim moral damages pursuant to the
is controlled by another political group. In a democrats the provisions of Article 2219, in connection with Article 21 and
minority should respect the majority and inasmuch as the Article 27 of the new Civil Code. Said Article 27 provides as
petitioners constitute the majority political group, it is but follows:
 'Any person suffering material or moral loss because council, as authorized an approved in a previous resolution. Secondly,
a public servant or employee refuses or neglects, it is not disputed that a majority of the members of the council (six out
without just cause, to perform his official duty may of ten) were present in these sessions. Consequently, pursuant to
file an action for damages and other relief against the Section 2221 of the Revised Administrative Code which provides:
latter, without prejudice to any disciplinary
administrative action that my be taken.' SEC. 2221. Quorum of council — Enforcing Attendance of
absent members. — The majority of the council elected shall
But in support of the allegations in the petition, only petitioner constitute a quorum to do business; ....
Exequiel Golez was presented as a witness who prove moral
damages he suffered as a consequence of the refusal the there was a quorum to do business in all the sessions in
respondent Susano Tayo to perform his official duty. such, of question. The term "quorum" has been defined as that number
all the petitioners, only Exequiel Golez is entitled receive of members of the body which, when legally as assembled in
moral damages in the sum of P100.00. their proper places, will enable the body to transact its proper
business, or, in other words, that number that makes a lawful
IN VIEW OF THE FOREGOING, the petition for a writ body and gives it power to pass a law or ordinance or do any
of mandamus is hereby granted, and the respondent is here other valid corporate act. (4 McQuillin, Municipal
ordered to give due course to the resolutions and ordinance Corporation [3rd Ed 478]; see also State vs. Wilkesville Tp.,
passed by the petitioners in the regular sessions during the 20 Ohio St. 288).
absence of the respondent, to give due course and sign the
payrolls covering the periods of June 1, June 15, July 6, July Appellant, however asserts that while under Section 2221 of the
20, August 3, August 17, September 7, and September 21, 196 Revised Administrative Code, the majority of the members of the
for the payment of per diems of the petitioners as Municipal council constitutes a quorum to do business, the council "shall be
Councilors; to pay to said Exequiel Golez, the sum of P100.00 presided by the Mayor and no one else", inasmuch as it is one of the
as moral damage, to pay the sum of P100.00 as attorney's fee duties imposed upon him under Section 2194(d) of the Revised
and to pay the costs of the proceeding. Administrative Code. 1 The argument would be correct if the mayor
(herein appellant) were present at the sessions in question and was
SO ORDERED. prevented from presiding therein, but not where, as in the instant case,
he absented himself therefrom.
Respondent-appellant claims, in this appeal, that the trial court erred
in holding that the sessions held by petitioners-appellees during his Appellant likewise invokes Section 7 (third paragraph) of Republic
absence and during the absence of his Vice-Mayor and the No. 1 and Act No. 9264, 2 in support of his view that the sessions in question
No. 2 Councilors the Municipal Council of Buenavista, Iloilo were were null and void, as they were not presided by him or by his Vice-
valid an legal. Mayor, or by the councilor who obtained the largest number of votes.

The claim is untenable. In the first place, there is no question that the It is true that this section mentions only the vice-mayor, or in his place,
sessions at issue were held on the days set for regular sessions of the the councilor who obtained the largest number of votes who could
perform the duties of the mayor, in the event of the latter's temporary consideration. Public interest will immensely suffer, if a mayor who
incapacity to do so, except the power to appoint, suspend, or dismiss belong to one political group refused to call or attend a session because
employees. Ordinarily, this enumeration would be in interpreted as the council is controlled by another political group."
exclusive, following the general principle of inclusio unius, est
exclusio alterius, but there are cogent reasons to disregard this rule in Lastly, appellant contests the award of moral damage to appellee
this case, since to adopt it would cause inconvenience, hardship, and councilor Exequiel Golez. We find said award proper under Article 27
injury to public interest, as it would place in the hands of mayor, vice- of the new Civil Code, 3 considering that according to the trial court,
mayor, and the councilor receiving the highest number of votes an he (Golez) was able to prove that he suffered the same, as a
instrument to defeat the law investing the legislative power in the consequence of appellant's refusal to perform his official duty, not
municipal council, by simply boycotting, as they continuously did for withstanding the action taken by the Provincial Fiscal an the
4 months, regular sessions of the council. It is to be noted that same Provincial Board upholding the validity of the session in question.
section 7 of Republic Act No. 2264 invoked by appellant provides, in
case of permanent incapacity of mayor, vice-mayor, and the councilor WHEREFORE, the decision appealed from is hereby affirmed with
obtaining the largest number of votes, to assume and perform the costs against respondent-appellant. So ordered.
duties of mayor, the councilor receiving the next largest number of
votes, and so on, can assume and perform such duties. We see no
strong reason why the same procedure should not be followed in case
of temporary incapacity, there being no express prohibition against its
observance. The legal provision being therefore susceptible of two in
interpretations, we adopt the one in consonance with the resumed
intention of the legislature to give its enactmentthe most reasonable
and beneficial construction, the that will render them operative and
effective and harmonious with other provisions of law. This is
imperative because, as already pointed out heretofore, under the law
"the majority of the council elected shall constitute a quorum to do
business", and this would be defeated if adopt the literal interpretation
of appellant that only mayor, vice-mayor, or the councilor receiving
the largest number of votes could preside the council's meeting, to
legal, irrespective of the presence of a quorum or majority of the
councilors elected. Such an interpretation would, indeed, be fraught
with dangerous consequences. For it would, in effect, deprive the
municipal council its function, namely, the enactment of ordinances
design for the general welfare of its inhabitants. As the trial court aptly
observed, "To declare that the proceedings of thepetitioners (herein
appellees) were null and void, is to encourage recalcitrant public
officials who would frustrate valid sessions for political end or
G.R. No. L-31380 January 13, 1930 or about 1900, the plaintiff began exporting its khaki into the
Philippine Islands through local firms, notable Holliday, Wise & Co.,
E. SPINNER and COMPANY, plaintiff-appellant, (now Wise & Co.), Smith, Bell & co., Ltd., and others. Because of the
vs. superior qualities of its goods, such as the fastness of its color, the
NEUSS HESSLEIN CORPORATION, defendant-appellee. consistency of its texture, and its proven durability, the plaintiff's
khaki made favorable impression in the Philippine market, enjoying a
Benj. S. Ohnick and John R. McFie, jr., for appellant. popular favor and preference which resulted in a lucrative trade.
Camus and Delgado for appellee. Among the brands of khaki enjoying such favor was the grade
indicated by the manufacturer as "Wigan." A higher grade was
STREET, J.: marketed by the plaintiff under the brand "Stockport;" while still other
grades were put upon the market under the brands "Jackton" and
This action was instituted in the Court of First Instance of Manila on "Ashford."
November 23, 1926, by E. Spinner & Co., of Manchester, England,
for the purpose of restraining the defendant, the Neuss Hesslein All of these different grades of khaki were marketed by the plaintiff
Corporation, organized under the laws of the Philippine Islands, from under a common trade-mark, which was first registered in the Bureau
using the word "Wigan," as applied to khaki textiles sold by the of Patents, Copyrights, and Trade-Marks of the Philippine
defendant in the Philippine Islands, and to recover damages for Government in the year 1905. This trade-mark consists of a large label
violation of the plaintiff's trade-mark right in the word "Wigan" and representing the profiles of two elephant heads placed close to each
for alleged unfair competition committed by the defendant in the use other in the upper middle center of the label and looking in opposite
of the same. Upon hearing the cause the trial court absolved the directions, with trunks extending respectively to the right and left. This
defendant from the complaint, with costs against the plaintiff, and the device has for its rectangular border a garland of leaves; while over
plaintiff appealed. the point of union between the two heads appear several flags. Inside
the space formed by the trunks of the elephants and the garland of
There is little or no dispute upon the determinative facts of the case leaves appears a label consisting of the following words:
which are subtantially these: E. Spinner & Co. is a copartnership with
head offices in Manchester, England, and Bombay, India, being LEEMANN & GATTY'S
represented in the Philippine Islands by Wise & Co., a domestic ORIGINAL
corporation with principal office in the City of Manila; while the PATENTED FAST
defendant is a corporation organized in December, 1922, under the KHAKI DRILL
laws of the Philippine Islands, with its principal office in the City of
Manila. The defendant is a subsidiary of Neuss Hesslein & Co., Inc., Agents: Messrs. E. SPINNER & CO.
of New York, U. S. A., for whom it acts as selling agent in the MANCHESTER & BOMBAY
Philippine Islands. The plaintiff, E. Spinner & Co., has long been Quality:................................Yds.
engaged in the manufacture and sale of textile fabrics, including khaki
cloth, with distributing business connection in different parts of the REGISTERED
world. Soon after the American occupation of the Philippine Islands, No. 50,275.
This label was pasted on the outside of each bolt of khaki sold by the Soldiers" sells at from 54 centavos to 55 centavos, and its "Four
plaintiff, the different grades being indicated by the words "Wigan," Soldiers" from 35 centavos to 40 centavos a yard.
"Stockport," etc., inserted with stencil in the blank space following the
word "Quality." The trade-mark proper, as thus used, was a general After the defendant corporation had assumed the agency in the
mark covering various brands. This practice was followed for more Philippine Islands for the products of the New York house, the manger
than twenty years, but the plaintiff learned in 1924 that the defendant, of the defendant, at the request of Chinese customers, began to give
the Neuss Hesslein Corporation, was selling a brand of khaki in the orders to the New York house for the printing of the word "Wigan"
Philippine Islands with the word "Wigan" stenciled on the bolts below conspicuously upon the bolts of khaki intended for sale in Philippine
the defendant's own trade-mark. As thus employed by the defendant, Islands; and in the latter part of 1923 or in the early part of the year
the word "Wigan" purports to show the color of the defendant's khaki, 1924, the defendant's khaki began to be marketed here with the word
but the proof shows that the word was thus used by the defendant upon "Wigan" thereon.
khaki of different shades. After discovering this fact, the plaintiff, in
April, 1925, caused its trade-mark, consisting of the two elephant It appears that the words "Wigan," "Stockport," "Jackton," and
heads, to be again registered in the Bureau of Commerce and Industry, "Ashford," adopted by the plaintiff to indicate different qualities of
as per certificate No. 4807. In its essential features, this trade-mark is khaki, are the names of manufacturing towns of minor importance in
identical with the trade-mark registered by the plaintiff in 1905, but in England; but the brand of khaki with which the defendant associates
the latter trade-mark the word "Wigan" is inserted after the word the name "Wigan" does not appear to be manufactured in the town of
"Quality." The purpose of this registration was of course to Wigan. It also appears that the term "Wigan" is used in commercial
incorporate the word "Wigan" as an integral part of the registered parlance as the name of a canvass-like cotton fabric used to stiffen
trade-mark. parts of garments. But it is clear that in adopting the word "Wigan" to
indicate a brand of khaki, the plaintiff did not use the word "Wigan"
As already stated, the defendant, the Neuss Hesslein Corporation, was either in its geographical sense or in the trade sense of a material for
organized in the Philippine Islands in December, 1922, as subsidiary stiffening. The use made by the plaintiff of the term "Wigan" is
of Neuss Hesslein & Co., Inc., of New York; and beginning with 1923, therefore arbitrary and artificial, in that it departs from any previously
the defendant has been marketing khaki in the Philippine Islands for accepted sense.
the New York house. But before the organization of the defendant the
New York house had, for several years, been selling its khaki in the It will be noted that the plaintiff uses the word "Wigan" to indicate
Philippine Islands, under two different brands. These were known quality, while the defendant purports to use the term to indicate color,
respectively as the "Five Soldiers" and the "Four Soldiers," the last though the defendant's practice in this usage is somewhat loose. There
named being also known as the "Wide Awake" brand. The "Five is some proof in the record tending to show that American dealers are
Soldiers" trade-mark was registered in the Bureau of Commerce and accustomed to use the word "Wigan" to indicate a color or certain
Industry in 1916, and the "Four Soldiers" trade-mark in February, shades of color of khaki cloth. But it is evident that the plaintiff first
1923. These two grades of khaki are marketed at a much lower price adopted the word "Wigan" in connection with khaki cloth, and this
than plaintiff's "Wigan," since it appears that the plaintiff's "Wigan" is was done for the purpose of indicating quality. In this sense the word
sold in the Philippine market by Wise & Co. for 71 centavos per yard, "Wigan" has accompanied the plaintiff's khaki for years in the
and by other firms at 70 centavos a yard, while defendant's "Five different markets of the world, and the term has become associated in
the minds of merchants who deal in this material with the standard of an earlier date than the principles applicable to unfair competition, it
quality maintained by the plaintiff in the "Wigan" brand. is not surprising that confusion should be found in the earlier decisions
between the legal doctrines relating to the two subjects. Of late years,
This action involves a question of trade-mark right and a further however, the term "trade-mark" has been restricted to its proper
question of unfair competition, and the problem is to determine technical meaning and the term "unfair competition" is used to include
whether, upon the facts above stated, the defendant corporation has a wrongful acts of competition not involving any violation of trade-
right to use the word "Wigan" on khaki sold by it in the Philippine mark right proper. As the tort of unfair competition is broader than the
Islands. The law governing trade-mark rights as well as unfair wrong involved in the infringement of a trade-mark, one who fails to
competition in this jurisdiction is found in Act No. 666 of the establish the exclusive property right which is essential to the validity
Philippine Commission, which is a reduction to statutory form of the of a trade-mark, may yet frequently obtain relief on the ground of his
jurisprudence developed by the courts of England and the United competitor's unfairness or fraud. Any conduct may be said to
States in connection with the subjects mentioned; and to the summary constitute unfair competition if the effect is to pass off on the public
of substantive law expressed in the statute are added the provisions the goods of one man as the goods of another. It is not necessary that
relative to the registration of trade-marks. Act No. 666 has been from any particular means should be used to this end. The most usual
time to time amended, but none of the amendatory provisions adopted devices are the simulation of labels and the reproduction of the form,
prior to the beginning of this lawsuit have any bearing on the problem color and general appearance of the package used by the pioneer
before us. manufacturer or dealer. But unfair competition is not limited to these
forms. The general principle underlying the law of unfair competition
Though the law concerning infringement of trade-marks and that is that a competitor in business cannot be permitted to do acts which
concerning unfair competition have a common conception at their have deceived, or are reasonably designed to deceive, the public into
root, which is that one person shall not be permitted to misrepresent buying his goods as those of another.
that his goods or his business are the goods or the business of another,
the law concerning unfair competition is broader and more inclusive. As stated in section 7 of Act No. 666, a person is guilty of unfair
On the other hand, the law concerning the infringement of trade-mark competition who "in selling his goods shall give them the general
is of more limited range, but within its narrower range recognizes a appearance of goods of another manufacturer or dealer, either in the
more exclusive right derived from the adoption and registration of the wrapping of the packages in which they are contained, or the devices
trade-mark by the person whose goods or business are first associated or words thereon, or in any other feature of their appearance, which
therewith. One who has identified a peculiar symbol or mark with his would be likely to influence purchasers to believe that the goods
goods thereby acquires a property right in such symbol or mark, and offered are those of a manufacturer or dealer other than the actual
if another infringes the trade-mark he thereby invades this property manufacturer or dealer," etc. This language is very broad; and as
right. Unfair competition cannot be placed on the plane of invasion of applied to the case before us it is evident that, in using the word
property right. The tort is strictly one of fraud. It results that the law "Wigan" on the khaki cloth sold by it, the defendant has appropriated
of trade-marks is specialized subject distinct from the law of unfair a word likely to lead purchasers to believe that the goods sold by the
competition, though, as stated above, the two subjects are entwined defendant are those of the plaintiff. The representation that the khaki
with each other and are dealt with together in Act No. 666. Inasmuch sold by the defendant is of the kind known to the trade as "Wigan"
as the principles applicable to trade-marks were precisely defined at
directly tends to deceive the purchaser and, therefore, constitutes the plaintiff's registered trade-mark; but after that date it was certainly
unfair competition as against the plaintiff. illegal for the defendant to use the word "Wigan" stamped upon the
khaki sold by it; and this act was an infringement of trade-mark right.
It is no doubt true that the adoption of the word "Wigan" by the It is true that the plaintiff's trade-mark proper consisted of a pictorial
defendant does not deceive merchants or tailors buying from the representation of the heads of two elephants, embelished by leaves,
defendant. But the person most to be considered in this connection is and the word "Wigan" was only a part of said trade-mark.
the consumer, and when the word "Wigan" is found upon a bolt of Nevertheless, the misappropriation of this word by the competitor was
khaki, the ultimate buyer, or consumer, would naturally be led to a violation of the plaintiff's right. It has been held in the Supreme Court
suppose that the goods sold under this name is the goods sold by the of the United States that the use of only one of the words constituting
plaintiff. In the case before us it is revealed that the word "Wigan" was a trade-mark may be sufficient to constitute an infringement, and it is
first stamped upon the khaki sold by the defendant at the suggestion not necessary to this end that all of the words comprising the trade-
or request of a Chinese customer, presumably a tailor or merchant, and mark should be appropriated (Saxlehner vs. Eisner & Mendelson Co.,
the purpose behind the suggestion undoubtedly was that, if this term 179 U.S., 20; 45 Law. ed., 60).
were found stamped upon the khaki thus sold it could be represented
to the ultimate purchaser that the khaki thus sold was the plaintiff's In section 2 of Act No. 666 it is declared that a designation or part of
"Wigan." In this connection it should be noted that, in the action to a designation which relates only to the name, quality, or description of
enjoin unfair competition, the fraudulent intention on the part of the the merchandise, or geographical place of its production or origin,
defendant may be inferred from the similarity of the goods offered for cannot be made the subject of a trade-mark; and it seems to be
sale by him to the goods of the plaintiff (Act No. 666, sec. 7, end). In supposed by the defendant that this provision disables the plaintiff
the case before us the use of the word "Wigan," stamped by the from complaining of the use made of the word "Wigan" by the
defendant upon the bolts of khaki sold by it, sufficiently discloses an defendant. But it will be noted that the word "Wigan" as applied to
intention to mislead the consumer. Moreover, as was observed by the quality, is not an English word in common use for describing quality.
Court of Appeals of the Third Circuit in Barton vs. Rex-Oil Co., (40 The word "Wigan" is here used in an entirely artificial sense and its
A. L. R., 424), it makes no difference that dealers in the article are not association with quality had the origin exclusively in the use which
deceived. They are informed and usually know what they are buying. the plaintiff has made of it. The designation of name, quality, or
The law concerns itself with the casual purchaser who knows the description, as used in the statute, has reference to linguistic terms in
commodity only by its name. In obtaining what he asks for he is common use. In words of this character no particular manufacturer can
entitled to protection against unfair dealing. (Citing National Biscuit acquire an exclusive property right. Again, it will be noted that,
Co. vs. Baker, 95 Fed., 135; Eli Lilly & Co., vs. Wm. R. Warner & although "Wigan," being the name of a town, was an original
Co., 275 Fed., 752; William R. Warner & Co. vs. Eli Lilly & Co., 265 geographical term, it is not used upon the plaintiff's khaki to indicate
U. S., 526.) the geographical place of production of the product. Even
geographical terms can be used in an arbitrary and artificial sense, and
With respect to the question of infringement of trade-mark right, it is when so used by one manufacturer the improper appropriation of the
clear that the appropriation by the defendant of the word "Wigan" for same term by another may be enjoined as an invasion of trade-mark
use in the sale of its khaki did not constitute a violation of trade-mark right. Of course, if the defendant were manufacturing its khaki in the
prior to April, 1925, when the word "Wigan" was first incorporated in
town of "Wigan," it would be entitled to use that name to indicate the the "Wigan" brand. In absolving the defendant from the claim for
place of manufacture of its goods. But such is not the case here. damages, the judgment will be affirmed. So ordered, without costs.

From what has been said it follows that the plaintiff is entitled to an Ostrand, Johns, Romualdez and Villa-Real, JJ., concur.
injunction for the purpose of restraining the defendant from using the
word "Wigan" upon the bolts of khaki sold by it, whether the wrongful
act of the defendant be considered as an act of unfair competition or
as an infringement of the trade-mark registered by the plaintiff in
April, 1925. But the plaintiff further seeks to recover damages in the Separate Opinions
estimated amount of P15,000 for the injury sustained by the plaintiff.
As in Forbes, Munn & Co., vs. Ang San To (43 Phil., 724), the AVANCEÑA, C.J. and MALCOLM, J., dissenting:
provision in the complaint referring to damages should, we think, be
interpreted as a prayer for an assessment of the compensation to which
A question of fact was submitted in this case in the lower court for
the plaintiff might be entitled for the damage done to its business. The resolution. That question of fact was resolved not alone by one Judge
proof, however, shows that the plaintiff's business has shown a healthy
of First Instance but by two Judges of First Instance against the
growth during the period covered by the wrongful acts which are the pretensions of the plaintiff. The facts which the court found
subject of this action, and it is not proved that any assessable damage established were "by a great preponderance of the evidence." The
has been inflicted upon the plaintiff by the wrongful acts of the pronouncements of the trial court on this issue of fact should
defendant, though the infringement of legal right is clear. We are
accordingly be here respected.
therefore of the opinion that no damages should be awarded to the
plaintiff. It will be noted that Act No. 666 gives the plaintiff a right to
In regard to the facts, it is noted that in the year 1905 the plaintiff
elect between the recovery of damages for the harm done to the
partnership registered its trade-mark but without including therein the
plaintiff's business and the enforcement of an accounting against the
word "Wigan." Thereafter, American khaki came into the Philippine
defendant for the profits which may be shown to have accrued to it by
market and made use of the word "Wigan" to indicate the particular
reason of the sales made in violation of the plaintiff's right. But these
color of khaki. This was done openly, and without any attempt at
two remedies are different and, where the plaintiff has elected to sue
deception. In 1925, the plaintiff partnership amended its former trade-
for damages and no damages are proved, none can be awarded. This
mark by including in the same, among others, the word "Wigan." In
makes it unnecessary to analyze the proof with a view to discovering
relation with these undisputed facts, it should further be mentioned
the profits which the defendant may have earned by the illegitimate
that the plaintiff did not present even one witness to establish that any
sales.
person had ever been deceived by buying the khaki cloth of the
defendant, believing the same to be the khaki cloth of the plaintiff. On
The judgment appealed from will therefore be modified, and the
the contrary, the purchasing agent of the Government testified that
defendant and its agents will be enjoined, as they are hereby enjoined, there has never been any confusion between the khaki cloth of the
from using the word "Wigan" upon the khaki sold by it in the
plaintiff and the khaki cloth of the defendant.
Philippine Islands, and from otherwise representing its khaki to be of
The law does not prohibit every similarity in the manufacture and
labeling of merchandise (Alhambra Cigar & Cigarette Manufacturing
Co. vs. Compania Gral. de Tabacos [1916], 35 Phil., 62). As the word
"Wigan" had become common in the khaki trade in the Philippines to
designate a particular color of American manufactured khaki cloth,
and had also become common to designate a certain quality or grade
of English manufactured khaki cloth, there was similarity but not
deceitful similarity.

This is a case of competition. It is not a case of unfair competition.

Accordingly, the decision of the trial court, agreeing in all respects
with the decision of another branch of the same court, should be
sustained and confirmed by absolving the defendant from the
complaint. That is our vote.
G.R. No. 141309 June 19, 2007 55%, and which imposes an ad valorem tax of "55% provided that the
minimum tax shall not be less than Five Pesos (P5.00) per pack."6
LIWAYWAY VINZONS-CHATO, petitioner,
vs. On July 2, 1993, at about 5:50 p.m., BIR Deputy Commissioner Victor
FORTUNE TOBACCO CORPORATION, respondent. A. Deoferio, Jr. sent via telefax a copy of RMC 37-93 to Fortune
Tobacco but it was addressed to no one in particular. On July 15, 1993,
DECISION Fortune Tobacco received, by ordinary mail, a certified xerox copy of
RMC 37-93. On July 20, 1993, respondent filed a motion for
YNARES-SANTIAGO, J.: reconsideration requesting the recall of RMC 37-93, but was denied
in a letter dated July 30, 1993.7 The same letter assessed respondent
Petitioner assails the May 7, 1999 Decision1 of the Court of Appeals for ad valorem tax deficiency amounting to P9,598,334.00 (computed
in CA-G.R. SP No. 47167, which affirmed the September 29, 1997 on the basis of RMC 37-93) and demanded payment within 10 days
Order2 of the Regional Trial Court (RTC) of Marikina, Branch 272, in from receipt thereof.8 On August 3, 1993, respondent filed a petition
Civil Case No. 97-341-MK, denying petitioner’s motion to dismiss. for review with the Court of Tax Appeals (CTA), which on September
The complaint filed by respondent sought to recover damages for the 30, 1993, issued an injunction enjoining the implementation of RMC
alleged violation of its constitutional rights arising from petitioner’s 37-93.9 In its decision dated August 10, 1994, the CTA ruled that RMC
issuance of Revenue Memorandum Circular No. 37-93 (RMC 37-93), 37-93 is defective, invalid, and unenforceable and further enjoined
which the Court declared invalid in Commissioner of Internal Revenue petitioner from collecting the deficiency tax assessment issued
v. Court of Appeals.3 pursuant to RMC No. 37-93. This ruling was affirmed by the Court of
Appeals, and finally by this Court in Commissioner of Internal
Petitioner Liwayway Vinzons-Chato was then the Commissioner of Revenue v. Court of Appeals.10 It was held, among others, that RMC
Internal Revenue while respondent Fortune Tobacco Corporation is an 37-93, has fallen short of the requirements for a valid administrative
entity engaged in the manufacture of different brands of cigarettes, issuance.
among which are "Champion," "Hope," and "More" cigarettes.
On April 10, 1997, respondent filed before the RTC a complaint 11 for
On June 10, 1993, the legislature enacted Republic Act No. 7654 (RA damages against petitioner in her private capacity. Respondent
7654), which took effect on July 3, 1993. Prior to its effectivity, contended that the latter should be held liable for damages under
Article 32 of the Civil Code considering that the issuance of RMC 37-
cigarette brands ‘Champion," "Hope," and "More" were considered
local brands subjected to an ad valorem tax at the rate of 20-45%. 93 violated its constitutional right against deprivation of property
However, on July 1, 1993, or two days before RA 7654 took effect, without due process of law and the right to equal protection of the
petitioner issued RMC 37-93 reclassifying "Champion," "Hope," and laws.
"More" as locally manufactured cigarettes bearing a foreign
brand subject to the 55% ad valorem tax.4 RMC 37-93 in effect Petitioner filed a motion to dismiss12 contending that: (1) respondent
subjected "Hope," "More," and "Champion" cigarettes to the has no cause of action against her because she issued RMC 37-93 in
provisions of RA 7654, specifically, to Sec. 142, 5 (c)(1) on locally the performance of her official function and within the scope of her
manufactured cigarettes which are currently classified and taxed at authority. She claimed that she acted merely as an agent of the
Republic and therefore the latter is the one responsible for her acts; (2) of the corporate secretary’s certificate giving authority to its counsel
the complaint states no cause of action for lack of allegation of malice to execute the same.
or bad faith; and (3) the certification against forum shopping was
signed by respondent’s counsel in violation of the rule that it is the Undaunted, petitioner filed the instant recourse contending that the
plaintiff or the principal party who should sign the same. suit is grounded on her acts done in the performance of her functions
as a public officer, hence, it is Section 38, Book I of the Administrative
On September 29, 1997, the RTC denied petitioner’s motion to Code which should be applied. Under this provision, liability will
dismiss holding that to rule on the allegations of petitioner would be attach only when there is a clear showing of bad faith, malice, or gross
to prematurely decide the merits of the case without allowing the negligence. She further averred that the Civil Code, specifically,
parties to present evidence. It further held that the defect in the Article 32 which allows recovery of damages for violation of
certification against forum shopping was cured by respondent’s constitutional rights, is a general law on the liability of public officers;
submission of the corporate secretary’s certificate authorizing its while Section 38, Book I of the Administrative Code is a special law
counsel to execute the certification against forum shopping. The on the superior public officers’ liability, such that, if the complaint, as
dispositive portion thereof, states: in the instant case, does not allege bad faith, malice, or gross
negligence, the same is dismissible for failure to state a cause of
WHEREFORE, foregoing premises considered, the motion to action. As to the defect of the certification against forum shopping,
dismiss filed by the defendant Liwayway Vinzons-Chato and she urged the Court to strictly construe the rules and to dismiss the
the motion to strike out and expunge from the record the said complaint.
motion to dismiss filed by plaintiff Fortune Tobacco
Corporation are both denied on the grounds aforecited. The Conversely, respondent argued that Section 38 which treats in general
defendant is ordered to file her answer to the complaint within the public officers’ "acts" from which civil liability may arise, is a
ten (10) days from receipt of this Order. general law; while Article 32 which deals specifically with the public
officers’ violation of constitutional rights, is a special provision which
SO ORDERED.13 should determine whether the complaint states a cause of action or not.
Citing the case of Lim v. Ponce de Leon,14 respondent alleged that
The case was elevated to the Court of Appeals via a petition for under Article 32 of the Civil Code, it is enough that there was a
certiorari under Rule 65. However, same was dismissed on the ground violation of the constitutional rights of the plaintiff and it is not
that under Article 32 of the Civil Code, liability may arise even if the required that said public officer should have acted with malice or in
defendant did not act with malice or bad faith. The appellate court bad faith. Hence, it concluded that even granting that the complaint
ratiocinated that Section 38, Book I of the Administrative Code is the failed to allege bad faith or malice, the motion to dismiss for failure to
general law on the civil liability of public officers while Article 32 of state a cause of action should be denied inasmuch as bad faith or
the Civil Code is the special law that governs the instant case. malice are not necessary to hold petitioner liable.
Consequently, malice or bad faith need not be alleged in the complaint
for damages. It also sustained the ruling of the RTC that the defect of The issues for resolution are as follows:
the certification against forum shopping was cured by the submission
 (1) May a public officer be validly sued in his/her private his official duties, unless there is a clear showing of bad faith,
capacity for acts done in connection with the discharge of the malice or gross negligence.
functions of his/her office?
xxxx
(2) Which as between Article 32 of the Civil Code and Section
38, Book I of the Administrative Code should govern in Section 39. Liability of Subordinate Officers. – No
determining whether the instant complaint states a cause of subordinate officer or employee shall be civilly liable for acts
action? done by him in good faith in the performance of his duties.
However, he shall be liable for willful or negligent acts done
(3) Should the complaint be dismissed for failure to comply by him which are contrary to law, morals, public policy and
with the rule on certification against forum shopping? good customs even if he acts under orders or instructions of
his superior.
(4) May petitioner be held liable for damages?
In addition, the Court held in Cojuangco, Jr. v. Court of Appeals,18 that
On the first issue, the general rule is that a public officer is not liable a public officer who directly or indirectly violates the constitutional
for damages which a person may suffer arising from the just rights of another, may be validly sued for damages under Article 32 of
performance of his official duties and within the scope of his assigned the Civil Code even if his acts were not so tainted with malice or bad
tasks.15 An officer who acts within his authority to administer the faith.
affairs of the office which he/she heads is not liable for damages that
may have been caused to another, as it would virtually be a charge Thus, the rule in this jurisdiction is that a public officer may be validly
against the Republic, which is not amenable to judgment for monetary sued in his/her private capacity for acts done in the course of the
claims without its consent.16 However, a public officer is by law not performance of the functions of the office, where said public officer:
immune from damages in his/her personal capacity for acts done in (1) acted with malice, bad faith, or negligence; or (2) where the public
bad faith which, being outside the scope of his authority, are no longer officer violated a constitutional right of the plaintiff.
protected by the mantle of immunity for official actions. 17
Anent the second issue, we hold that the complaint filed by respondent
Specifically, under Section 38, Book I of the Administrative Code, stated a cause of action and that the decisive provision thereon is
civil liability may arise where there is bad faith, malice, or gross Article 32 of the Civil Code.
negligence on the part of a superior public officer. And, under Section
39 of the same Book, civil liability may arise where the subordinate A general statute is one which embraces a class of subjects or places
public officer’s act is characterized by willfulness or negligence. Thus and does not omit any subject or place naturally belonging to such
– class. A special statute, as the term is generally understood, is one
which relates to particular persons or things of a class or to a particular
Sec. 38. Liability of Superior Officers. – (1) A public officer portion or section of the state only.19
shall not be civilly liable for acts done in the performance of
A general law and a special law on the same subject are statutes in pari application is concerned, Republic Act No. 409 is a special
materia and should, accordingly, be read together and harmonized, if law and the Civil Code a general legislation; but, as regards
possible, with a view to giving effect to both. The rule is that where the subject matter of the provisions above quoted, Section 4
there are two acts, one of which is special and particular and the other of Republic Act 409 establishes a general rule regulating the
general which, if standing alone, would include the same matter and liability of the City of Manila for "damages or injury to
thus conflict with the special act, the special law must prevail since it persons or property arising from the failure of" city officers
evinces the legislative intent more clearly than that of a general statute "to enforce the provisions of" said Act "or any other law or
and must not be taken as intended to affect the more particular and ordinance, or from negligence" of the city "Mayor, Municipal
specific provisions of the earlier act, unless it is absolutely necessary Board, or other officers while enforcing or attempting to
so to construe it in order to give its words any meaning at all. 20 enforce said provisions." Upon the other hand, Article 2189
of the Civil Code constitutes a particular prescription making
The circumstance that the special law is passed before or after the "provinces, cities and municipalities . . . liable for damages
general act does not change the principle. Where the special law is for the death of, or injury suffered by, any person by reason"
later, it will be regarded as an exception to, or a qualification of, the — specifically — "of the defective condition of roads, streets,
prior general act; and where the general act is later, the special statute bridges, public buildings, and other public works under their
will be construed as remaining an exception to its terms, unless control or supervision." In other words, said section 4 refers
repealed expressly or by necessary implication. 21 to liability arising from negligence, in general, regardless
of the object thereof, whereas Article 2189 governs
Thus, in City of Manila v. Teotico,22 the Court held that Article 2189 liability due to "defective streets," in particular. Since the
of the Civil Code which holds provinces, cities, and municipalities present action is based upon the alleged defective
civilly liable for death or injuries by reason of defective conditions of condition of a road, said Article 2189 is decisive thereon.23
roads and other public works, is a special provision and should prevail
over Section 4 of Republic Act No. 409, the Charter of Manila, in In the case of Bagatsing v. Ramirez,24 the issue was which law should
determining the liability for defective street conditions. Under said govern the publication of a tax ordinance, the City Charter of Manila,
Charter, the city shall not be held for damages or injuries arising from a special act which treats ordinances in general and which requires
the failure of the local officials to enforce the provision of the charter, their publication before enactment and after approval, or the Tax
law, or ordinance, or from negligence while enforcing or attempting Code, a general law, which deals in particular with "ordinances
to enforce the same. As explained by the Court: levying or imposing taxes, fees or other charges," and which demands
publication only after approval. In holding that it is the Tax Code
Manila maintains that the former provision should prevail which should prevail, the Court elucidated that:
over the latter, because Republic Act 409 is a special law,
intended exclusively for the City of Manila, whereas the Civil There is no question that the Revised Charter of the City of
Code is a general law, applicable to the entire Philippines. Manila is a special act since it relates only to the City of
Manila, whereas the Local Tax Code is a general law because
The Court of Appeals, however, applied the Civil Code, and, it applies universally to all local governments. Blackstone
we think, correctly. It is true that, insofar as its territorial defines general law as a universal rule affecting the entire
 community and special law as one relating to particular (6) The right against deprivation of property without due
persons or things of a class. And the rule commonly said is process of law;
that a prior special law is not ordinarily repealed by a
subsequent general law. The fact that one is special and the xxxx
other general creates a presumption that the special is to be
considered as remaining an exception of the general, one as a (8) The right to the equal protection of the laws;
general law of the land, the other as the law of a particular
case. However, the rule readily yields to a situation where xxxx
the special statute refers to a subject in general, which the
general statute treats in particular. Th[is] exactly is the The rationale for its enactment was explained by Dean Bocobo of the
circumstance obtaining in the case at bar. Section 17 of the Code Commission, as follows:
Revised Charter of the City of Manila speaks of
"ordinance" in general, i.e., irrespective of the nature and
"DEAN BOCOBO. Article 32, regarding individual rights,
scope thereof, whereas, Section 43 of the Local Tax Code
Attorney Cirilo Paredes proposes that Article 32 be so
relates to "ordinances levying or imposing taxes, fees or
amended as to make a public official liable for violation of
other charges" in particular. In regard, therefore, to
another person’s constitutional rights only if the public
ordinances in general, the Revised Charter of the City of
official acted maliciously or in bad faith. The Code
Manila is doubtless dominant, but, that dominant force
Commission opposes this suggestion for these reasons:
loses its continuity when it approaches the realm of
"ordinances levying or imposing taxes, fees or other
charges" in particular. There, the Local Tax Code "The very nature of Article 32 is that the wrong may be civil
controls. Here, as always, a general provision must give way or criminal. It is not necessary therefore that there should be
to a particular provision. Special provision governs. malice or bad faith. To make such a requisite would defeat the
main purpose of Article 32 which is the effective protection
of individual rights. Public officials in the past have abused
Let us examine the provisions involved in the case at bar. Article 32
their powers on the pretext of justifiable motives or good faith
of the Civil Code provides:
in the performance of their duties. Precisely, the object of the
Article is to put an end to official abuse by the plea of good
ART. 32. Any public officer or employee, or any private
faith. In the United States this remedy is in the nature of a tort.
individual, who directly or indirectly obstructs, defeats,
violates, or in any manner impedes or impairs any of the
"Mr. Chairman, this article is firmly one of the fundamental
following rights and liberties of another person shall be liable
articles introduced in the New Civil Code to implement
to the latter for damages:
democracy. There is no real democracy if a public official is
abusing and we made the article so strong and so
xxxx comprehensive that it concludes an abuse of individual rights
even if done in good faith, that official is liable. As a matter
of fact, we know that there are very few public officials who
 openly and definitely abuse the individual rights of the Administrative Code pursuant to the exercise of legislative powers,
citizens. In most cases, the abuse is justified on a plea of desire then President Corazon C. Aquino, could not have intended to
to enforce the law to comply with one’s duty. And so, if we obliterate this constitutional protection on civil liberties.
should limit the scope of this article, that would practically
nullify the object of the article. Precisely, the opening object In Aberca v. Ver,32 it was held that with the enactment of Article 32,
of the article is to put an end to abuses which are justified by the principle of accountability of public officials under the
a plea of good faith, which is in most cases the plea of officials Constitution acquires added meaning and assumes a larger dimension.
abusing individual rights."25 No longer may a superior official relax his vigilance or abdicate his
duty to supervise his subordinates, secure in the thought that he does
The Code Commission deemed it necessary to hold not only public not have to answer for the transgressions committed by the latter
officers but also private individuals civilly liable for violation of the against the constitutionally protected rights and liberties of the citizen.
rights enumerated in Article 32 of the Civil Code. It is not necessary Part of the factors that propelled people power in February 1986 was
that the defendant under this Article should have acted with malice or the widely held perception that the government was callous or
bad faith, otherwise, it would defeat its main purpose, which is the indifferent to, if not actually responsible for, the rampant violations of
effective protection of individual rights. It suffices that there is a human rights. While it would certainly be too naive to expect that
violation of the constitutional right of the plaintiff. 26 violators of human rights would easily be deterred by the prospect of
facing damage suits, it should nonetheless be made clear in no
Article 32 was patterned after the "tort" in American law. 27 A tort is a uncertain terms that Article 32 of the Civil Code makes the persons
wrong, a tortious act which has been defined as the commission or who are directly, as well as indirectly, responsible for the
omission of an act by one, without right, whereby another receives transgression, joint tortfeasors.
some injury, directly or indirectly, in person, property, or
reputation.28 There are cases in which it has been stated that civil On the other hand, Sections 38 and 39, Book I of the Administrative
liability in tort is determined by the conduct and not by the mental Code, laid down the rule on the civil liability of superior and
state of the tortfeasor, and there are circumstances under which the subordinate public officers for acts done in the performance of their
motive of the defendant has been rendered immaterial. The reason duties. For both superior and subordinate public officers, the presence
sometimes given for the rule is that otherwise, the mental attitude of of bad faith, malice, and negligence are vital elements that will make
the alleged wrongdoer, and not the act itself, would determine whether them liable for damages. Note that while said provisions deal in
the act was wrongful.29 Presence of good motive, or rather, the absence particular with the liability of government officials, the subject thereof
of an evil motive, does not render lawful an act which is otherwise an is general, i.e., "acts" done in the performance of official duties,
invasion of another’s legal right; that is, liability in tort is not without specifying the action or omission that may give rise to a civil
precluded by the fact that defendant acted without evil intent. 30 suit against the official concerned.

The clear intention therefore of the legislature was to create a distinct Contrarily, Article 32 of the Civil Code specifies in clear and
cause of action in the nature of tort for violation of constitutional unequivocal terms a particular specie of an "act" that may give rise to
rights, irrespective of the motive or intent of the defendant. 31 This is a an action for damages against a public officer, and that is, a tort for
fundamental innovation in the Civil Code, and in enacting the impairment of rights and liberties. Indeed, Article 32 is the special
provision that deals specifically with violation of constitutional rights With costs.
by public officers. All other actionable acts of public officers are
governed by Sections 38 and 39 of the Administrative Code. While SO ORDERED.
the Civil Code, specifically, the Chapter on Human Relations is a
general law, Article 32 of the same Chapter is a special and specific
provision that holds a public officer liable for and allows redress from
a particular class of wrongful acts that may be committed by public
officers. Compared thus with Section 38 of the Administrative Code,
which broadly deals with civil liability arising from errors in the
performance of duties, Article 32 of the Civil Code is the specific
provision which must be applied in the instant case precisely filed to
seek damages for violation of constitutional rights.

The complaint in the instant case was brought under Article 32 of the
Civil Code. Considering that bad faith and malice are not necessary in
an action based on Article 32 of the Civil Code, the failure to
specifically allege the same will not amount to failure to state a cause
of action. The courts below therefore correctly denied the motion to
dismiss on the ground of failure to state a cause of action, since it is
enough that the complaint avers a violation of a constitutional right of
the plaintiff.

Anent the issue on non-compliance with the rule against forum

shopping, the subsequent submission of the secretary’s certificate
authorizing the counsel to sign and execute the certification against
forum shopping cured the defect of respondent’s complaint. Besides,
the merits of the instant case justify the liberal application of the
rules.33

WHEREFORE, in view of the foregoing, the petition is DENIED.

The Decision of the Court of Appeals dated May 7, 1999 which
affirmed the Order of the Regional Trial Court of Marikina, Branch
272, denying petitioner’s motion to dismiss, is AFFIRMED. The
Presiding Judge, Regional Trial Court of Marikina, Branch 272, is
hereby DIRECTED to continue with the proceedings in Civil Case
No. 97-341-MK with dispatch.
G.R. No. 141994 January 17, 2005 the broadcasts were defamatory, AMEC and Angelita Ago ("Ago"),
as Dean of AMEC’s College of Medicine, filed a complaint for
FILIPINAS BROADCASTING NETWORK, INC., petitioner, damages7 against FBNI, Rima and Alegre on 27 February 1990.
vs. Quoted are portions of the allegedly libelous broadcasts:
AGO MEDICAL AND EDUCATIONAL CENTER-BICOL
CHRISTIAN COLLEGE OF MEDICINE, (AMEC-BCCM) and JUN ALEGRE:
ANGELITA F. AGO, respondents.
Let us begin with the less burdensome: if you have children taking
DECISION medical course at AMEC-BCCM, advise them to pass all subjects
because if they fail in any subject they will repeat their year level,
CARPIO, J.: taking up all subjects including those they have passed already.
Several students had approached me stating that they had consulted
The Case with the DECS which told them that there is no such regulation. If
[there] is no such regulation why is AMEC doing the same?
This petition for review1 assails the 4 January 1999 Decision2 and 26
January 2000 Resolution of the Court of Appeals in CA-G.R. CV No. xxx
40151. The Court of Appeals affirmed with modification the 14
December 1992 Decision3 of the Regional Trial Court of Legazpi City, Second: Earlier AMEC students in Physical Therapy had
Branch 10, in Civil Case No. 8236. The Court of Appeals held complained that the course is not recognized by DECS. xxx
Filipinas Broadcasting Network, Inc. and its broadcasters Hermogenes
Alegre and Carmelo Rima liable for libel and ordered them to Third: Students are required to take and pay for the subject even
solidarily pay Ago Medical and Educational Center-Bicol Christian if the subject does not have an instructor - such greed for money
College of Medicine moral damages, attorney’s fees and costs of suit. on the part of AMEC’s administration. Take the subject Anatomy:
students would pay for the subject upon enrolment because it is
The Antecedents offered by the school. However there would be no instructor for such
subject. Students would be informed that course would be moved to a
"Exposé" is a radio documentary4 program hosted by Carmelo ‘Mel’ later date because the school is still searching for the appropriate
Rima ("Rima") and Hermogenes ‘Jun’ Alegre ("Alegre").5 Exposé is instructor.
aired every morning over DZRC-AM which is owned by Filipinas
Broadcasting Network, Inc. ("FBNI"). "Exposé" is heard over Legazpi xxx
City, the Albay municipalities and other Bicol areas. 6
It is a public knowledge that the Ago Medical and Educational Center
In the morning of 14 and 15 December 1989, Rima and Alegre has survived and has been surviving for the past few years since its
exposed various alleged complaints from students, teachers and inception because of funds support from foreign foundations. If you
parents against Ago Medical and Educational Center-Bicol Christian will take a look at the AMEC premises you’ll find out that the names
College of Medicine ("AMEC") and its administrators. Claiming that of the buildings there are foreign soundings. There is a McDonald
Hall. Why not Jose Rizal or Bonifacio Hall? That is a very concrete MEL RIMA:
and undeniable evidence that the support of foreign foundations for
AMEC is substantial, isn’t it? With the report which is the basis of the xxx My friends based on the expose, AMEC is a dumping ground for
expose in DZRC today, it would be very easy for detractors and moral and physically misfit people. What does this mean? Immoral
enemies of the Ago family to stop the flow of support of foreign and physically misfits as teachers.
foundations who assist the medical school on the basis of the latter’s
purpose. But if the purpose of the institution (AMEC) is to deceive May I say I’m sorry to Dean Justita Lola. But this is the truth. The
students at cross purpose with its reason for being it is possible for truth is this, that your are no longer fit to teach. You are too old. As an
these foreign foundations to lift or suspend their donations aviation, your case is zero visibility. Don’t insist.
temporarily.8
xxx Why did AMEC still absorb her as a teacher, a dean, and chairman
xxx of the scholarship committee at that. The reason is practical cost
saving in salaries, because an old person is not fastidious, so long as
On the other hand, the administrators of AMEC-BCCM, AMEC she has money to buy the ingredient of beetle juice. The elderly can
Science High School and the AMEC-Institute of Mass get by – that’s why she (Lola) was taken in as Dean.
Communication in their effort to minimize expenses in terms of
salary are absorbing or continues to accept "rejects". For example xxx
how many teachers in AMEC are former teachers of Aquinas
University but were removed because of immorality? Does it mean xxx On our end our task is to attend to the interests of students. It is
that the present administration of AMEC have the total definite moral likely that the students would be influenced by evil. When they
foundation from catholic administrator of Aquinas University. I will become members of society outside of campus will be liabilities
prove to you my friends, that AMEC is a dumping ground, garbage, rather than assets. What do you expect from a doctor who while
not merely of moral and physical misfits. Probably they only qualify studying at AMEC is so much burdened with unreasonable
in terms of intellect. The Dean of Student Affairs of AMEC is Justita imposition? What do you expect from a student who aside from
Lola, as the family name implies. She is too old to work, being an old peculiar problems – because not all students are rich – in their struggle
woman. Is the AMEC administration exploiting the very [e]nterprising to improve their social status are even more burdened with false
or compromising and undemanding Lola? Could it be that AMEC is regulations. xxx9 (Emphasis supplied)
just patiently making use of Dean Justita Lola were if she is very old.
As in atmospheric situation – zero visibility – the plane cannot land, The complaint further alleged that AMEC is a reputable learning
meaning she is very old, low pay follows. By the way, Dean Justita institution. With the supposed exposés, FBNI, Rima and Alegre
Lola is also the chairman of the committee on scholarship in AMEC. "transmitted malicious imputations, and as such, destroyed plaintiffs’
She had retired from Bicol University a long time ago but AMEC has
(AMEC and Ago) reputation." AMEC and Ago included FBNI as
patiently made use of her. defendant for allegedly failing to exercise due diligence in the
selection and supervision of its employees, particularly Rima and
xxx Alegre.
On 18 June 1990, FBNI, Rima and Alegre, through Atty. Rozil WHEREFORE, premises considered, this court finds for the
Lozares, filed an Answer10 alleging that the broadcasts against AMEC plaintiff. Considering the degree of damages caused by the
were fair and true. FBNI, Rima and Alegre claimed that they were controversial utterances, which are not found by this court to be
plainly impelled by a sense of public duty to report the "goings-on in really very serious and damaging, and there being no showing that
AMEC, [which is] an institution imbued with public interest." indeed the enrollment of plaintiff school dropped, defendants
Hermogenes "Jun" Alegre, Jr. and Filipinas Broadcasting Network
Thereafter, trial ensued. During the presentation of the evidence for (owner of the radio station DZRC), are hereby jointly and severally
the defense, Atty. Edmundo Cea, collaborating counsel of Atty. ordered to pay plaintiff Ago Medical and Educational Center-Bicol
Lozares, filed a Motion to Dismiss11 on FBNI’s behalf. The trial court Christian College of Medicine (AMEC-BCCM) the amount of
denied the motion to dismiss. Consequently, FBNI filed a separate ₱300,000.00 moral damages, plus ₱30,000.00 reimbursement of
Answer claiming that it exercised due diligence in the selection and attorney’s fees, and to pay the costs of suit.
supervision of Rima and Alegre. FBNI claimed that before hiring a
broadcaster, the broadcaster should (1) file an application; (2) be SO ORDERED. 13 (Emphasis supplied)
interviewed; and (3) undergo an apprenticeship and training program
after passing the interview. FBNI likewise claimed that it always Both parties, namely, FBNI, Rima and Alegre, on one hand, and
reminds its broadcasters to "observe truth, fairness and objectivity in AMEC and Ago, on the other, appealed the decision to the Court of
their broadcasts and to refrain from using libelous and indecent Appeals. The Court of Appeals affirmed the trial court’s judgment
language." Moreover, FBNI requires all broadcasters to pass with modification. The appellate court made Rima solidarily liable
the Kapisanan ng mga Brodkaster sa Pilipinas ("KBP") accreditation with FBNI and Alegre. The appellate court denied Ago’s claim for
test and to secure a KBP permit. damages and attorney’s fees because the broadcasts were directed
against AMEC, and not against her. The dispositive portion of the
On 14 December 1992, the trial court rendered a Decision12 finding Court of Appeals’ decision reads:
FBNI and Alegre liable for libel except Rima. The trial court held that
the broadcasts are libelous per se. The trial court rejected the WHEREFORE, the decision appealed from is hereby AFFIRMED,
broadcasters’ claim that their utterances were the result of straight subject to the modification that broadcaster Mel Rima
reporting because it had no factual basis. The broadcasters did not is SOLIDARILY ADJUDGED liable with FBN[I] and
even verify their reports before airing them to show good faith. In Hermo[g]enes Alegre.
holding FBNI liable for libel, the trial court found that FBNI failed to
exercise diligence in the selection and supervision of its employees. SO ORDERED.14

In absolving Rima from the charge, the trial court ruled that Rima’s FBNI, Rima and Alegre filed a motion for reconsideration which the
only participation was when he agreed with Alegre’s exposé. The trial Court of Appeals denied in its 26 January 2000 Resolution.
court found Rima’s statement within the "bounds of freedom of
speech, expression, and of the press." The dispositive portion of the Hence, FBNI filed this petition.15
decision reads:
The Ruling of the Court of Appeals
The Court of Appeals upheld the trial court’s ruling that the questioned FBNI raises the following issues for resolution:
broadcasts are libelous per se and that FBNI, Rima and Alegre failed
to overcome the legal presumption of malice. The Court of Appeals I. WHETHER THE BROADCASTS ARE LIBELOUS;
found Rima and Alegre’s claim that they were actuated by their moral
and social duty to inform the public of the students’ gripes as II. WHETHER AMEC IS ENTITLED TO MORAL
insufficient to justify the utterance of the defamatory remarks. DAMAGES;

Finding no factual basis for the imputations against AMEC’s III. WHETHER THE AWARD OF ATTORNEY’S FEES IS
administrators, the Court of Appeals ruled that the broadcasts were PROPER; and
made "with reckless disregard as to whether they were true or false."
The appellate court pointed out that FBNI, Rima and Alegre failed to IV. WHETHER FBNI IS SOLIDARILY LIABLE WITH
present in court any of the students who allegedly complained against RIMA AND ALEGRE FOR PAYMENT OF MORAL
AMEC. Rima and Alegre merely gave a single name when asked to DAMAGES, ATTORNEY’S FEES AND COSTS OF SUIT.
identify the students. According to the Court of Appeals, these
circumstances cast doubt on the veracity of the broadcasters’ claim
The Court’s Ruling
that they were "impelled by their moral and social duty to inform the
public about the students’ gripes."
We deny the petition.
The Court of Appeals found Rima also liable for libel since he
This is a civil action for damages as a result of the allegedly
remarked that "(1) AMEC-BCCM is a dumping ground for morally
defamatory remarks of Rima and Alegre against AMEC.17 While
and physically misfit teachers; (2) AMEC obtained the services of
AMEC did not point out clearly the legal basis for its complaint, a
Dean Justita Lola to minimize expenses on its employees’ salaries;
reading of the complaint reveals that AMEC’s cause of action is based
and (3) AMEC burdened the students with unreasonable imposition
on Articles 30 and 33 of the Civil Code. Article 3018 authorizes a
and false regulations."16
separate civil action to recover civil liability arising from a criminal
offense. On the other hand, Article 3319 particularly provides that the
The Court of Appeals held that FBNI failed to exercise due diligence injured party may bring a separate civil action for damages in cases of
in the selection and supervision of its employees for allowing Rima defamation, fraud, and physical injuries. AMEC also invokes Article
and Alegre to make the radio broadcasts without the proper KBP 1920 of the Civil Code to justify its claim for damages. AMEC cites
accreditation. The Court of Appeals denied Ago’s claim for damages Articles 217621 and 218022 of the Civil Code to hold FBNI solidarily
and attorney’s fees because the libelous remarks were directed against
liable with Rima and Alegre.
AMEC, and not against her. The Court of Appeals adjudged FBNI,
Rima and Alegre solidarily liable to pay AMEC moral damages,
I.
attorney’s fees and costs of suit.
Whether the broadcasts are libelous
Issues
A libel23 is a public and malicious imputation of a crime, or of a vice about nor confirm the purported irregularities in AMEC from the
or defect, real or imaginary, or any act or omission, condition, status, Department of Education, Culture and Sports. Alegre testified that he
or circumstance tending to cause the dishonor, discredit, or contempt merely went to AMEC to verify his report from an alleged AMEC
of a natural or juridical person, or to blacken the memory of one who official who refused to disclose any information. Alegre simply relied
is dead.24 on the words of the students "because they were many and not because
there is proof that what they are saying is true."28 This plainly shows
There is no question that the broadcasts were made public and imputed Rima and Alegre’s reckless disregard of whether their report was true
to AMEC defects or circumstances tending to cause it dishonor, or not.
discredit and contempt. Rima and Alegre’s remarks such as "greed for
money on the part of AMEC’s administrators"; "AMEC is a dumping Contrary to FBNI’s claim, the broadcasts were not "the result of
ground, garbage of xxx moral and physical misfits"; and AMEC straight reporting." Significantly, some courts in the United States
students who graduate "will be liabilities rather than assets" of the apply the privilege of "neutral reportage" in libel cases involving
society are libelous per se. Taken as a whole, the broadcasts suggest matters of public interest or public figures. Under this privilege, a
that AMEC is a money-making institution where physically and republisher who accurately and disinterestedly reports certain
morally unfit teachers abound. defamatory statements made against public figures is shielded from
liability, regardless of the republisher’s subjective awareness of the
However, FBNI contends that the broadcasts are not malicious. FBNI truth or falsity of the accusation.29 Rima and Alegre cannot invoke the
claims that Rima and Alegre were plainly impelled by their civic duty privilege of neutral reportage because unfounded comments abound
to air the students’ gripes. FBNI alleges that there is no evidence that in the broadcasts. Moreover, there is no existing controversy involving
ill will or spite motivated Rima and Alegre in making the broadcasts. AMEC when the broadcasts were made. The privilege of neutral
FBNI further points out that Rima and Alegre exerted efforts to obtain reportage applies where the defamed person is a public figure who is
AMEC’s side and gave Ago the opportunity to defend AMEC and its involved in an existing controversy, and a party to that controversy
administrators. FBNI concludes that since there is no malice, there is makes the defamatory statement.30
no libel.
However, FBNI argues vigorously that malice in law does not apply
FBNI’s contentions are untenable. to this case. Citing Borjal v. Court of Appeals,31 FBNI contends that
the broadcasts "fall within the coverage of qualifiedly privileged
Every defamatory imputation is presumed malicious. 25 Rima and communications" for being commentaries on matters of public
Alegre failed to show adequately their good intention and justifiable interest. Such being the case, AMEC should prove malice in fact or
motive in airing the supposed gripes of the students. As hosts of a actual malice. Since AMEC allegedly failed to prove actual malice,
documentary or public affairs program, Rima and Alegre should have there is no libel.
presented the public issues "free from inaccurate and misleading
information."26 Hearing the students’ alleged complaints a month FBNI’s reliance on Borjal is misplaced. In Borjal, the Court
before the exposé,27 they had sufficient time to verify their sources and elucidated on the "doctrine of fair comment," thus:
information. However, Rima and Alegre hardly made a thorough
investigation of the students’ alleged gripes. Neither did they inquire
[F]air commentaries on matters of public interest are privileged and Secondly, there is reason to believe that defendant radio broadcasters,
constitute a valid defense in an action for libel or slander. The doctrine contrary to the mandates of their duties, did not verify and analyze the
of fair comment means that while in general every discreditable truth of the reports before they aired it, in order to prove that they are
imputation publicly made is deemed false, because every man is in good faith.
presumed innocent until his guilt is judicially proved, and every false
imputation is deemed malicious, nevertheless, when the discreditable Alegre contended that plaintiff school had no permit and is not
imputation is directed against a public person in his public capacity, it accredited to offer Physical Therapy courses. Yet, plaintiff produced
is not necessarily actionable. In order that such discreditable a certificate coming from DECS that as of Sept. 22, 1987 or more than
imputation to a public official may be actionable, it must either be 2 years before the controversial broadcast, accreditation to offer
a false allegation of fact or a comment based on a false supposition. Physical Therapy course had already been given the plaintiff, which
If the comment is an expression of opinion, based on established certificate is signed by no less than the Secretary of Education and
facts, then it is immaterial that the opinion happens to be mistaken, as Culture herself, Lourdes R. Quisumbing (Exh. C-rebuttal). Defendants
long as it might reasonably be inferred from the facts. 32 (Emphasis could have easily known this were they careful enough to verify. And
supplied) yet, defendants were very categorical and sounded too positive when
they made the erroneous report that plaintiff had no permit to offer
True, AMEC is a private learning institution whose business of Physical Therapy courses which they were offering.
educating students is "genuinely imbued with public interest." The
welfare of the youth in general and AMEC’s students in particular is The allegation that plaintiff was getting tremendous aids from foreign
a matter which the public has the right to know. Thus, similar to the foundations like Mcdonald Foundation prove not to be true also. The
newspaper articles in Borjal, the subject broadcasts dealt with matters truth is there is no Mcdonald Foundation existing. Although a big
of public interest. However, unlike in Borjal, the questioned building of plaintiff school was given the name Mcdonald building,
broadcasts are not based on established facts. The record supports the that was only in order to honor the first missionary in Bicol of
following findings of the trial court: plaintiffs’ religion, as explained by Dr. Lita Ago. Contrary to the claim
of defendants over the air, not a single centavo appears to be received
xxx Although defendants claim that they were motivated by consistent by plaintiff school from the aforementioned McDonald Foundation
reports of students and parents against plaintiff, yet, defendants have which does not exist.
not presented in court, nor even gave name of a single student who
made the complaint to them, much less present written complaint or Defendants did not even also bother to prove their claim, though
petition to that effect. To accept this defense of defendants is too denied by Dra. Ago, that when medical students fail in one subject,
dangerous because it could easily give license to the media to malign they are made to repeat all the other subject[s], even those they have
people and establishments based on flimsy excuses that there were already passed, nor their claim that the school charges laboratory fees
reports to them although they could not satisfactorily establish it. Such even if there are no laboratories in the school. No evidence was
laxity would encourage careless and irresponsible broadcasting which presented to prove the bases for these claims, at least in order to give
is inimical to public interests. semblance of good faith.
As for the allegation that plaintiff is the dumping ground for misfits, misleading information. x x x Furthermore, the station shall
and immoral teachers, defendant[s] singled out Dean Justita Lola who strive to present balanced discussion of issues. x x x.
is said to be so old, with zero visibility already. Dean Lola testified in
court last Jan. 21, 1991, and was found to be 75 years old. xxx Even xxx
older people prove to be effective teachers like Supreme Court Justices
who are still very much in demand as law professors in their late years. 7. The station shall be responsible at all times in the
Counsel for defendants is past 75 but is found by this court to be still supervision of public affairs, public issues and commentary
very sharp and effective.l^vvphi1.net So is plaintiffs’ counsel. programs so that they conform to the provisions and standards
of this code.
Dr. Lola was observed by this court not to be physically decrepit yet,
nor mentally infirmed, but is still alert and docile. 8. It shall be the responsibility of the newscaster,
commentator, host and announcer to protect public interest,
The contention that plaintiffs’ graduates become liabilities rather than general welfare and good order in the presentation of public
assets of our society is a mere conclusion. Being from the place affairs and public issues.36 (Emphasis supplied)
himself, this court is aware that majority of the medical graduates of
plaintiffs pass the board examination easily and become prosperous The broadcasts fail to meet the standards prescribed in the Radio Code,
and responsible professionals.33 which lays down the code of ethical conduct governing practitioners
in the radio broadcast industry. The Radio Code is a voluntary code of
Had the comments been an expression of opinion based on established conduct imposed by the radio broadcast industry on its own members.
facts, it is immaterial that the opinion happens to be mistaken, as long The Radio Code is a public warranty by the radio broadcast industry
as it might reasonably be inferred from the facts. 34 However, the that radio broadcast practitioners are subject to a code by which their
comments of Rima and Alegre were not backed up by facts. Therefore, conduct are measured for lapses, liability and sanctions.
the broadcasts are not privileged and remain libelous per se.
The public has a right to expect and demand that radio broadcast
The broadcasts also violate the Radio Code35 of the Kapisanan ng mga practitioners live up to the code of conduct of their profession, just like
Brodkaster sa Pilipinas, Ink. ("Radio Code"). Item I(B) of the Radio other professionals. A professional code of conduct provides the
Code provides: standards for determining whether a person has acted justly, honestly
and with good faith in the exercise of his rights and performance of
B. PUBLIC AFFAIRS, PUBLIC ISSUES AND his duties as required by Article 1937 of the Civil Code. A professional
COMMENTARIES code of conduct also provides the standards for determining whether
a person who willfully causes loss or injury to another has acted in a
1. x x x manner contrary to morals or good customs under Article 2138 of the
Civil Code.
4. Public affairs program shall present public issues free
from personal bias, prejudice and inaccurate and II.
Whether AMEC is entitled to moral damages III.

FBNI contends that AMEC is not entitled to moral damages because Whether the award of attorney’s fees is proper
it is a corporation.39
FBNI contends that since AMEC is not entitled to moral damages,
A juridical person is generally not entitled to moral damages because, there is no basis for the award of attorney’s fees. FBNI adds that the
unlike a natural person, it cannot experience physical suffering or such instant case does not fall under the enumeration in Article 2208 48 of
sentiments as wounded feelings, serious anxiety, mental anguish or the Civil Code.
moral shock.40 The Court of Appeals cites Mambulao Lumber Co. v.
PNB, et al.41 to justify the award of moral damages. However, the The award of attorney’s fees is not proper because AMEC failed to
Court’s statement in Mambulao that "a corporation may have a good justify satisfactorily its claim for attorney’s fees. AMEC did not
reputation which, if besmirched, may also be a ground for the award adduce evidence to warrant the award of attorney’s fees. Moreover,
of moral damages" is an obiter dictum.42 both the trial and appellate courts failed to explicitly state in their
respective decisions the rationale for the award of attorney’s
Nevertheless, AMEC’s claim for moral damages falls under item 7 of fees.49 In Inter-Asia Investment Industries, Inc. v. Court of
Article 221943 of the Civil Code. This provision expressly authorizes Appeals ,50 we held that:
the recovery of moral damages in cases of libel, slander or any other
form of defamation. Article 2219(7) does not qualify whether the [I]t is an accepted doctrine that the award thereof as an item of
plaintiff is a natural or juridical person. Therefore, a juridical person damages is the exception rather than the rule, and counsel’s fees are
such as a corporation can validly complain for libel or any other form not to be awarded every time a party wins a suit. The power of the
of defamation and claim for moral damages. 44 court to award attorney’s fees under Article 2208 of the Civil Code
demands factual, legal and equitable justification, without which
Moreover, where the broadcast is libelous per se, the law implies the award is a conclusion without a premise, its basis being
damages.45 In such a case, evidence of an honest mistake or the want improperly left to speculation and conjecture. In all events, the
of character or reputation of the party libeled goes only in mitigation court must explicitly state in the text of the decision, and not only in
of damages.46 Neither in such a case is the plaintiff required to the decretal portion thereof, the legal reason for the award of
introduce evidence of actual damages as a condition precedent to the attorney’s fees. 51 (Emphasis supplied)
recovery of some damages.47 In this case, the broadcasts are
libelous per se. Thus, AMEC is entitled to moral damages. While it mentioned about the award of attorney’s fees by stating that
it "lies within the discretion of the court and depends upon the
However, we find the award of ₱300,000 moral damages circumstances of each case," the Court of Appeals failed to point out
unreasonable. The record shows that even though the broadcasts were any circumstance to justify the award.
libelous per se, AMEC has not suffered any substantial or material
damage to its reputation. Therefore, we reduce the award of moral IV.
damages from ₱300,000 to ₱150,000.
Whether FBNI is solidarily liable with Rima and Alegre for moral defamatory statements published by radio or television may be had
damages, attorney’s fees and costs of suit from the owner of the station, a licensee, the operator of the station,
or a person who procures, or participates in, the making of the
FBNI contends that it is not solidarily liable with Rima and Alegre for defamatory statements."54 An employer and employee are solidarily
the payment of damages and attorney’s fees because it exercised due liable for a defamatory statement by the employee within the course
diligence in the selection and supervision of its employees, and scope of his or her employment, at least when the employer
particularly Rima and Alegre. FBNI maintains that its broadcasters, authorizes or ratifies the defamation.55 In this case, Rima and Alegre
including Rima and Alegre, undergo a "very regimented process" were clearly performing their official duties as hosts of FBNI’s radio
before they are allowed to go on air. "Those who apply for broadcaster program Exposé when they aired the broadcasts. FBNI neither alleged
are subjected to interviews, examinations and an apprenticeship nor proved that Rima and Alegre went beyond the scope of their work
program." at that time. There was likewise no showing that FBNI did not
authorize and ratify the defamatory broadcasts.
FBNI further argues that Alegre’s age and lack of training are
irrelevant to his competence as a broadcaster. FBNI points out that the Moreover, there is insufficient evidence on record that FBNI exercised
"minor deficiencies in the KBP accreditation of Rima and Alegre do due diligence in the selection and supervision of its employees,
not in any way prove that FBNI did not exercise the diligence of a particularly Rima and Alegre. FBNI merely showed that it exercised
good father of a family in selecting and supervising them." Rima’s diligence in the selection of its broadcasters without introducing any
accreditation lapsed due to his non-payment of the KBP annual fees evidence to prove that it observed the same diligence in
while Alegre’s accreditation card was delayed allegedly for reasons the supervision of Rima and Alegre. FBNI did not show how it
attributable to the KBP Manila Office. FBNI claims that membership exercised diligence in supervising its broadcasters. FBNI’s alleged
in the KBP is merely voluntary and not required by any law or constant reminder to its broadcasters to "observe truth, fairness and
government regulation. objectivity and to refrain from using libelous and indecent language"
is not enough to prove due diligence in the supervision of its
FBNI’s arguments do not persuade us. broadcasters. Adequate training of the broadcasters on the industry’s
code of conduct, sufficient information on libel laws, and continuous
The basis of the present action is a tort. Joint tort feasors are jointly evaluation of the broadcasters’ performance are but a few of the many
and severally liable for the tort which they commit. 52 Joint tort feasors ways of showing diligence in the supervision of broadcasters.
are all the persons who command, instigate, promote, encourage,
advise, countenance, cooperate in, aid or abet the commission of a tort, FBNI claims that it "has taken all the precaution in the selection of
or who approve of it after it is done, if done for their benefit. 53 Thus, Rima and Alegre as broadcasters, bearing in mind their
AMEC correctly anchored its cause of action against FBNI on Articles qualifications." However, no clear and convincing evidence shows
2176 and 2180 of the Civil Code. that Rima and Alegre underwent FBNI’s "regimented process" of
application. Furthermore, FBNI admits that Rima and Alegre had
As operator of DZRC-AM and employer of Rima and Alegre, FBNI deficiencies in their KBP accreditation,56 which is one of FBNI’s
is solidarily liable to pay for damages arising from the libelous requirements before it hires a broadcaster. Significantly, membership
broadcasts. As stated by the Court of Appeals, "recovery for in the KBP, while voluntary, indicates the broadcaster’s strong
commitment to observe the broadcast industry’s rules and regulations.
Clearly, these circumstances show FBNI’s lack of diligence in
selecting and supervising Rima and Alegre. Hence, FBNI is solidarily
liable to pay damages together with Rima and Alegre.

WHEREFORE, we DENY the instant petition. We AFFIRM the

Decision of 4 January 1999 and Resolution of 26 January 2000 of the
Court of Appeals in CA-G.R. CV No. 40151 with the
MODIFICATION that the award of moral damages is reduced from
₱300,000 to ₱150,000 and the award of attorney’s fees is deleted.
Costs against petitioner.

SO ORDERED.
G.R. No. 117103 January 21, 1999 Reconsideration was denied in the assailed Resolution:3

Spouses RENATO S. ONG and FRANCIA N. ONG, petitioners, WHEREFORE, IN VIEW OF THE FOREGOING,
vs. both motions for reconsideration filed by [petitioners]
COURT OF APPEALS, INLAND RAILWAYS, INC. and and . . . Inland Trailways, Inc. are hereby DENIED.
PHILTRANCO SERVICE ENTERPRISE, INC., respondents.
The Facts

On February 9, 1987, petitioners boarded as paying passengers Bus-

PANGANIBAN, J.: No. 101 with late No. EVB-508 ("Inland bus," for convenience),
which was owned and operated by Inland Trailways under a Lease
Evidence not formally offered during the trial cannot be used for or Agreement with Philtranco. It was driven by Calvin Coronel. 4 Around
against a party litigant. Neither may it be taken into account on appeal. 3:50 in the morning of said date, when the Inland bus slowed down to
Furthermore, actual and moral damages must be proven before any avoid a stalled cargo truck in Tiaong, Quezon, it was bumped from the
award thereon can be granted. rear by another bus, owned and operated by Philtranco and driven by
Apolinar Miralles. Francia sustained wounds and fractures in both of
The Case her legs and her right arm, while Renato suffered injuries on his left
chest, right knee, right arm and left eye.5 They were brought to the San
Before us is a Petition for Review on Certiorari of the Decision dated Pablo City District Hospital for treatment and were confined there
May 20, 1993 and the Resolution dated June 8, 1994, both from February 9 to 18, 1987. 6
promulgated by the Court of Appeals 1 in CA-GR CV No. 33755,
modifying the Decision of the trial court in an action for damages filed On December 22, 1988, petitioners filed an action for damages against
by spouses Renato and Francia Ong (petitioners herein) against Philtranco and Inland. 7 In their Complaint, they alleged that they
Philtranco Service Enterprise, Inc. and Inland Trailways, Inc. suffered injuries, preventing Francia from operating a sari-sari store
(respondents herein, hereafter referred to as "Philtranco" and "Inland," at Las Piña's, Metro Manila, where she derived a daily income of
respectively). P200; and Renato from continuing his work as an overseas contract
worker (pipe welder) with a monthly salary of $690. Stating that they
The assailed Decision disposed as follows:2 incurred P10,000 as medical and miscellaneous expenses, they also
claimed moral damages of P500,000 each, exemplary and corrective
WHEREFORE, the appealed decision is damages of P500,000 each, and compensatory damages of P500,000
hereby MODIFIED by ordering INLAND each plus 35 percent thereof as attorney's fees. In addition to their
testimonies, petitioners also presented the following documentary
TRAILWAYS, INC. to pay [petitioners] P3,977.00
for actual damages, P30,000.00 as moral damages evidence:
and ten (10) percent as contingent attorney's fees and
to pay the costs of the suit. Exhibit A — Philtranco Bus Ticket
No. 333398
B — Philtranco Bus Ticket No. N — Payroll Summary for [period
333399 ending] November 1986

C — Certification dated February 12, O — Payroll Summary for [period

1987 ending] December, 1986

D — Medical Certificate of Francis Philtranco answered that the Inland bus with Plate No. EVB-508
Ong dated February 18, 1987 (which had transported petitioners) was registered and owned by
Inland; that its driver, Calvin Coronel, was an employee of Inland; that
E — Medical Certificate of Renato S. Philtranco was merely leasing its support facilities, including the use
Ong dated February 18, 1987 of its bus tickets, to Inland; and that under their Agreement, Inland
would be solely liable for all claims and liabilities arising from the
F — Statement of Account of operation of said bus. Philtranco further alleged that, with respect to
Francia N. Ong in the amount of its own bus (which bumped the Inland bus), it exercised the diligence
P1,153.50 of a good father of a family in the selection and supervision of its
drivers, and that the proximate cause of the accident was the
G — Statement of Account of negligence of either the cargo truck or the Inland bus which collided
Renato S. Ong in the amount of with said cargo truck.
P1,973.50
Inland answered that, according to the Police Report, it was Apolinar
H — Receipt dated February 9, 1987 Miralles, the driver of the Philtranco bus, who was at fault, as shown
by his flight from the situs of the accident; that said bus was registered
and owned by Philtranco; and that the driver of the Inland bus
I — Receipt dated March 3, 1987
exercised extraordinary diligence as testified to by its passengers.
Inland and Philtranco filed cross-claims against each other.
J — Receipt dated February 18, 1987
Both respondents moved to submit the case for decision without
K — Receipt dated February 24,
presenting further evidence. Consequently, the trial court, in its Order
1987
dated July 5, 1989, resolved:8
L & - L-1 — Picture of face of
When this case was called for continuation of
Renato S. Ong
presentation of plaintiffs evidence, over objections
from counsels for defendants, plaintiffs counsel was
M & M-1 — Picture of face of allowed to recall his first witness, Renato S. Ong, for
Renato S. Ong some additional direct questions[;] and after cross-
examination by defendant Inland Trailways, Inc.,
 adopted by defendant Philtranco Service Enterprise, 1) P10,000.00 as actual damages for medical and
Inc., plaintiff presented his second witness, [Francia] miscellaneous expenses;
Ong, whose testimony on direct, cross and redirect
was terminated[;] and as prayed for, counsel for the 2) P50,000.00 as compensatory damages for the
plaintiffs shall have five (5) days from today within [diminution] of the use of the right arm of
which to submit his formal offer of evidence, [petitioner]-wife;
furnishing copies thereof to defendants who shall
have five (5) days from their receipt within which to 3) P48,000.00 as unrealized profit or income;
submit comments after which the same shall be
deemed submitted for resolution. 4) P50,000.00 as moral damages;

By agreement, considering the stipulations of parties 5) 25% of the foregoing as contingent attorney's fees;
made of record regarding factual issues except as to and
whether or not the bus is included in the lease,
counsels for the two (2) defendants are given a period
6) the costs.
of ten (10) days from today within which to submit
simultaneous offer[s] of admission and denials not
According to the trial court, the proximate cause of the accident was
only on the above exception but on any other relevant
"the bumping from behind by the Philtranco bus with Plate No. 259
matter.
driven by Apolinar Miralles" based on the Police Report and the
affidavits of passengers, to which Philtranco did not object. As it failed
Considering that the documents are admitted, there is
to prove that it exercised due diligence in the selection and supervision
no necessity of any formal written offer of evidence of its employees under Article 2176 of the Civil Code, Philtranco was
and, therefore, after all the foregoing, the case shall held liable based on culpa aquiliana.
be deemed submitted for decision upon simultaneous
memoranda of the parties and upon submission of
Ruling of the Court of Appeals
complete transcripts.
On appeal, the Court of Appeals (CA) resolved that Philtranco's
Thereafter, the trial court rendered its May 7, 1991 Decision, which
liability for damages could not be predicated upon the Police Report
disposed as follows:9
which had not been formally offered in evidence. The report was
merely annexed to the answer of Inland, and petitioner did not adopt
IN VIEW OF ALL THE FOREGOING, judgment is or offer it as evidence. Consequently, it had no probative value and,
hereby rendered in favor of the [petitioners] absolving
thus, Philtranco should be absolved from liability.
Inland Trailways, Inc., from any liability whatsoever,
and against . . . Philtranco Service Enterprise, Inc.,
Instead, the appellate court found that petitioners sufficiently
ordering the latter to pay the [petitioners] —
established a claim against Inland based on culpa contractual. As a
common carrier, Inland was required to observe extra ordinary
diligence under Articles 1735 and 1750 of the Code. Its liability arose [III] Whether or not public
from its failure to transport its passengers and cargo safely, and a respondent committed grave abuse
finding of fault or negligence was not necessary to hold it liable for of discretion in reducing the award
damages. Inland failed to overcome this presumption of negligence by for actual and miscellaneous
contrary evidence; thus, it was liable for breach of its contractual expenses from P10,000.00 to
obligation to petitioners under Article 2201 of the Civil Code. P3,977.00; the award of P50,000.00
moral damages to P30,000.00; and
The liability of Inland for medical and miscellaneous expenses was the 25% contingent attorney's fees
reduced, as the evidence on record showed that petitioners spent only to10% thereof.
P3,977. Deemed self-serving was Francia's testimony that the use of
her right arm was diminished and that she lost income. Thus, the award Simply stated, the main issues raised are: (1) whether the Police
for unearned income was disallowed and the amount of moral Report, which was not formally offered in evidence, could be used to
damages was reduced to P30,000. establish a claim against Philtranco based on culpa aquiliana; and (2)
whether the reduction in the amounts of damages awarded was proper.
Hence, this petition.10
The Court's Ruling
The Issues
The petition is devoid of merit.
In their Memorandum, 11 petitioners raise the following issues: 12
First Issue:
[I] Whether or not public respondent
committed grave abuse of discretion Retirement of Formal Offer of Evidence
in completely reversing the decision
of the Regional Trial Court, ordering Petitioners take exception to the rule requiring documents to be
Philtranco to indemnify petitioners formally offered in evidence before they can be given any probative
and in lieu thereof, order[ing] Inland value, arguing that the parties agreed to submit the case for resolution
to pay petitioners for their damages. based on the July 5, 1989 Order of the trial court. Because of the
agreement, petitioners assumed that all the pieces of documentary
[II] Whether or not public respondent evidence, including the Complaint and its Annexes, as well as those
committed grave abuse of discretion in the respective Answers of the private respondents, were deemed
in disallowing the P50,000.00 admitted.
awarded to petitioner, Francia Ong
for the diminution of the use of her We disagree. Section 34, Rule 132 of the Rules of Court, provides that
right arm and the P48,000.00 "[t]he court shall consider no evidence which has not been formally
representing unrealized income. offered." A formal offer is necessary, since judges are required to base
their findings of fact and their judgment solely and strictly upon the
evidence offered by the parties at the trial. To allow parties to attach In the case at bar, the defendant INLAND and
any document to their pleadings and then expect the court to consider plaintiffs-appellees did not identify the said Annex
it as evidence, even without formal offer and admission, may draw "1" or the Police Investigation Report as evidence.
unwarranted consequences. Opposing parties will be deprived of their Thus, under Section 35 of Rule 132 of the Revised
chance to examine the document and to object to its admissibility. On Rules on Evidence, the court shall consider no
the other hand, the appellate court will have difficulty reviewing evidence which has not been formally offered.
documents not previously scrutinized the court below. 13 Corollary, the Police Investigation Report of Annex
"1" cannot be given any evidentiary value.
In adhering to this rule, the appellate court cannot be faulted with
reversible error, as it held: 14 Absen[t] Annex "1" which was the basis of the trial
court in finding PHILTRANCO liable, the latter is
. . . [T]he burden of proof lies with the plaintiff in thus exonerated from liability.
establishing fault or negligence on the part of the
defendant (Ong vs. Metropolitan Water). This, Petitioners similarly erred in presuming that said Annex was admitted
however, plaintiff-appellees failed to establish. in evidence by virtue of the Order of July 5, 1989. Their presumption
Albeit, there was a police investigation report finding has no basis. The Order required counsel for the petitioners to "submit
the driver of PHILTRANCO negligent which became his formal offer of evidence, furnishing copies thereof to defendants
the basis of the court a qou [for] holding who shall have five (5) days from their receipt within which to submit
PHILTRANCO liable, this piece of evidence was comments after which the same shall be deemed submitted for
merely attached as Annex "1" of INLAND's answer, resolution."15 In compliance, petitioners filed a written offer of
nothing more. It was not presented and even offered evidence on July 12, 1989.16 Such offer led the trial court, in its Order
as evidence by INLAND nor utilized by plaintiffs- of August 2, 1989, to formally admit in evidence Exhibits "A"-
appellees. Thus, even assuming arguendo that the "O."17 Clearly, the Police Report was neither offered by the petitioners
same had been identified in court, it would have no nor admitted by the trial court.
evidentiary value. Identification of documentary
evidence must be distinguished from its formal offer Moreover, the petitioners' allegations in their Complaint did not
as an exhibit. The first is done in the course of the trial establish a cause of action against Philtranco. They similarly failed to
and is accompanied by the marking of the evidence as make any reference to said Police Report during the presentation of
an exhibit. The second is done only when the party their case. This is precisely why Respondent Philtranco opted not to
rests its case and not before. The mere fact that a present further evidence. A document or an article is valueless unless
particular document is identified and marked as an it is formally offered in evidence, and the opposing counsel is given
exhibit does not mean it will be or has been offered as an opportunity to object to it and to cross-examine any witness called
part of the evidence of the party. The party may to present or identify it.18 Evidence not formally offered before the
decide to offer it if it believes this will advance the trial court cannot be considered on appeal, for to consider them at such
cause, and then again it may decide not to do so at all stage will deny the other parties their right to rebut them. 19
(People vs. Santito, Jr., 201 SCRA 87).
There is no agreement to submit the case based on the pleading, as of must be based on the evidence presented, not on the personal
contended by the petitioners. The parties had no such intention, nor knowledge of the court; and certainly not on flimsy, remote,
did said Order evince such an agreement. speculative and nonsubstantial proof. Article 2199 of the Civil Code
expressly mandates that "[e]xcept as provided by law or by stipulation,
Second Issue: one is entitled to an adequate compensation only for such pecuniary
loss suffered by him as he has duly proved."
Damages Require Evidence
The lack of basis for such award was patent in the trial court Decision:
Petitioners aver that there was grave abuse of discretion when the
amount of actual damages awarded was reduced from P10,000 to The records will show that from the documentary
P3,977, even if the original amount did not even include the medical evidence, [petitioners] have jointly spent the sum of
expenses that Francia continued to incur; and when the award of P3,977.00. [Respondent] Philtranco has not presented
P48,000 as unrealized income was deleted despite her testimony any evidence that it has advanced any amount for
which was given credence by the trial court. medicine, hospitalization and doctor's fees, but on the
contrary, [petitioners] have testified that they paid for
The Court disagrees. Granting arguendo that there was an agreement their expenses except at the initial stage wherein a
to submit the case for decision based on the pleadings, this does not representative of [respondent] Philtranco went to the
necessarily imply that petitioners are entitled to the award of damages. hospital to get the receipts of medicines only and paid
The fundamental principle of the law on damages is that one injured (t.s.n. — June 29, 1989, p. 6). Considering the claim
by a breach of contract (in this case, the contract of transportation) or of the [petitioners], as alleged in their complaint they
by a wrongful or negligent act or omission shall have a fair and just spent P10,000.00 representing medical and
compensation, commensurate with the loss sustained as a consequence miscellaneous expenses[;] considering that they have
of the defendant's acts. Hence, actual pecuniary compensation is the gone for consultation to at least two (2) different
general rule, except where the circumstances warrant the allowance of doctors, this Court may take judicial notice of the fact
other kinds of damages. that miscellaneous expenses [are] bound to be
incurred to cover transportation and food, and
Actual damages are such compensation or damages for an injury that therefore, finds the amount of P10,000.00 as actual
will put the injured party in the position in which he had been before damages to be reasonable.
he was injured. They pertain to such injuries or losses that are actually
sustained and susceptible of measurement. Except as provided by law Damages, after all, are not intended to enrich the complainant at the
or by stipulation, a party is entitled to adequate compensation only for expense of the defendant. 20
such pecuniary loss as he has duly proven.
Moral Damages and Diminution
To be recoverable, actual damages must be pleaded and proven in
Court. In no instance may the trial judge award more than those so of Use of Francia's Arm
pleaded and proven. Damages cannot be presumed. The award there
Petitioners protest the deletion of the amount of P50,000 earlier granted P15,000 as actual damages for plastic surgery. It bears
awarded by the trial court because of the diminution of the use of emphasis that the said amount was based on expert testimony. 24
Francia's right arm, arguing that she stated during direct examination
that it could no longer perform its normal functions,21 and that private In another case, the Court granted actual or compensatory damages in
respondents impliedly admitted this matter when they failed to present the sum of P18,000 for the surgical intervention necessary to arrest the
controverting evidence. degeneration of the mandible of a young boy. Again, there was an
expert testimony that such medical procedure would cost P3,000 and
A person is entitled to the physical integrity of his or her body, and if would have to be repeated several times to restore him to nearly
that integrity is violated, damages are due and assessable. However, normal condition. 25
physical injury, like loss or diminution of use of an arm or a limb, is
not a pecuniary loss. Indeed, it is nor susceptible of exact monetary In the case at bar, petitioner failed to present evidence regarding
estimation. the feasibility or practicability and the cost of a restorative medical
operation on her arm. Thus, there is no basis to grant her P48,000 for
Thus, the usual practice is to award moral damages for physical such expense.
injuries sustained. In Mayo v. People,22 the Court held that the
permanent scar on the forehead and the loss of the use of the right eye Unrealized Income
entitled the victim to moral damages. The victim, in said case,
devastated by mental anguish, wounded feelings and shock, which she Protesting the deletion of the award for Francia's unrealized income,
experienced as a result of her false eye and the scar on her forehead. petitioners contend that Francia's injuries and her oral testimony
Furthermore, the loss of vision in her right eye hampered her adequately support their claim. The Court disagrees. Although actual
professionally for the rest of her life. damages include indemnification for profits which the injured party
failed to obtain (lucro cesante or lucrum cesans),26 the rule requires
In the case at bar, it was sufficiently shown during the trial that that said person produce the "best evidence of which his case is
Francia's right arm could not function in a normal manner and that, as susceptible. 27
a result, she suffered mental anguish and anxiety. Thus, an increase in
the amount of moral damages awarded, from P30,000 to P50,000, The bare and unsubstantiated assertion of Francia that she usually
appears to be reasonable and justified. Renato also suffered mental earned P200 a day from her market stall is not the best evidence to
anxiety and anguish from the accident. Thus, he should be separately prove her claim of unrealized income for the eight-month period that
awarded P30,000 as moral damages. her arm was in plaster cast. Her testimony that was their lessor who
filed their income tax returns and obtained business licenses for them
In some instances, the Court awards the cost of medical procedures to does not justify her failure to present more credible evidence of her
restore the injured person to his or her former condition. However, this income. Furthermore, after her ten-day confinement at the San Pablo
award necessitates expert testimony on the cost of possible restorative Hospital,28 she could have returned so her work at the public market
medical procedure. In Gatchalian v. Delim, 23 the Court, reasoning that despite the plaster cast on her right arm, since she claimed to have two
a scar resulting from the infliction of injury on the face of a woman nieces as helpers.29 Clearly, the appellate court was correct in deleting
gave rise to a legitimate claim for restoration to her conditio ante,
the award for unrealized income, because of petitioner's utter failure We do not see any abuse thereof in the case at bar. In fact, the appellate
to substantiate her claim. court had been generous to petitioners' counsel, considering that the
nature of the case was not exceptionally difficult, and he was not
Attorney's Fees required to exert Herculean efforts. All told, his handling of the case
was sorely, inadequate, as shown by his failure to follow elementary
Counsel for petitioner deeply laments the reduction in the award of norms of civil procedure and evidence.
attorney's fees. He alleges that he had to use his own money for
transportation, stenographic transcriptions and other court expenses, WHEREFORE, the assailed Decision is AFFIRMED with the
and for such reason, avers that the award of 25 percent attorney's fees MODIFICATION that Renato and Francia Ong are separately
made by the trial court was proper. awarded moral damages in the amount of P30,000 and P50,000,
respectively. The ten percent (10%) attorney's fees shall be based on
Under the Civil Code, an award of attorney's fees is an indemnity for the total modified award.
damages ordered by a court to be paid by the losing party to the
prevailing party, based on any of the cases authorized by law. 30 It is SO ORDERED.
payable not to the lawyer but to the client, unless the two have agreed
that the award shall pertain to the lawyer as additional compensation
or as part thereof. The Court has established a set standards in fixing
the amount of attorney's fees: 31

(1) [T]he amount and character of the services

rendered; (2) labor, time and trouble involved; (3) the
nature and importance of the litigation or business in
which the services were rendered; (4) the
responsibility imposed; (5) the amount of money or
the value of the property affected by the controversy
or involved in the employment; (6) the skill and
experience called for in the performance of the
services; (7) the professional character and social
standing of the attorney; (8) the results secured, it
being a recognized rule that an attorney may properly
charge a much larger fee when it is contingent than
when it is not.

Counsel's performance, however, does not justify the award of 25

percent attorney's fees. It is well-settled that such award is addressed
to sound judicial discretion and subject to judicial control. 32
G.R. No. 76093 March 21, 1989 CARRIER EXPRESS

AIR FRANCE, petitioner, ITINERARY SPECIFIED RESTRICTIONS

vs.
THE COURT OF APPEALS AND NARCISO O. New York/Paris Air France NONENDORSABLE
MORALES, respondents. VALID ON AF ONLY

Siguion Reyna, Montecillo & Ongsiako for petitioner. Paris/Stockholm Air France NONENDORSABLE
VALID ON AF ONLY
Morales & Joyas Law Office for private respondent.
Stockholm/Copenhagen None

Copenhagen/London None
PADILLA, J.:
London/Amsterdam None
This is a petition for review on certiorari of the decision ** of the
Court of Appeals, dated 1986, in CA-G.R. CV No. 69875, Amsterdam/Hamburg None
entitled "Narciso Morales vs. Air France," dismissing herein
petitioner's appeal from the adverse ruling of the trial court (Branch Humburg/Frankfurt None
33, CFI of Rizal, Kalookan City) *** and the latter's denial of its
motion for reconsideration. The respondent Court of Appeals likewise Frankfurt/Paris Air France NONENDORSABLE
denied petitioner's motion for reconsideration of its decision in a VALID ON AF ONLY
resolution dated 25 September 1986.
Paris/Geneva Air France NONENDORSABLE
In reviewing the records, we find: VALID ON AF ONLY

Sometime in October 1977, private respondent Narciso Morales thru Geneva/Madrid None
his representative, Ms. Janet Tolentino, purchased an airline ticket
from Aspac Management Corporation, petitioner's General Sales Madrid/Nice Air France NONENDORSABLE
Agent in Makati, for P 9,426.00 plus P 1,413.90 travel tax, of which P
VALID ON AF ONLY
413.90 were later refunded to Ms. Tolentino.
Nice/Rome Air France NONENDORSABLE VALID
The itinerary covered by the ticket included several cities, with certain
ON AF ONLY
segments thereof restricted by markings of "non endorsable' and 'valid
on AF (meaning Air France) only', as herein specified:
Rome/Athens None
 Athens/Tel Aviv None Frankfurt/Geneva SR 26 Nov. OK (Swissair)

Tel Avive/Bangkok Air France NONENDORSABLE Geneva/Rome AZ 29 Nov. OK (Alitalia)

VALID ON AF ONLY
Rome/Hongkong BA 02 Dec. OK (British Airways)
Bangkok/Manila Air France NONENDORSABLE
VALID ON AF ONLY 1 Hongkong/Manila PR Open Open (Philippine
Airlines) 3
While in New York, U.S.A. on 3 November 1977, private respondent
Morales obtained three (3) medical certificates (Exhibits G, G-1, G-2) Upon arrival in Manila, respondent sent a letter-complaint to Air
attesting to ear an infection which necessitated medical treatment. France dated 20 December 1977 thru Aspac Management
From New York, he flew to Paris, Stockholm and then Copenhagen Corporation. Respondent Morales was advised to surrender the unused
where he made representations with petitioner's office to shorten his flight coupons for a refund of its value, but he kept the same and,
trip by deleting some of the cities in the itinerary. Respondent Morales instead, filed a complaint for breach of contract of carriage and
was informed that, as a matter of procedure, confirmation of damages.
petitioner's office in Manila (as ticketing office) must be secured
before shortening of the route (already paid for). Air France in CFI Judge Marcelino Sayo found Air France in evident bad faith for
Amsterdam telexed AF Manila requesting for rerouting of the violation of the contract of carriage, aggravated by the threatening
passenger to Amsterdam, Hamburg, Geneva, Rome, Hongkong, attitude of its employees in Hamburg. Considering the social and
Manila. 2 economic standing of respondent, who is chairman of the board of
directors of a multi-million corporation and a member of several civic
As there was no immediate response to the telex, respondent and business organizations, an award of moral and exemplary
proceeded to Hamburg where he was informed of AF Manila's damages, in addition to the actual damages incurred, was deemed
negative reply. After reiterating his need to flying home on a shorter proper under the circumstances. The dispositive part of the CFI
route due to his ear infection, and presentation of supporting medical decision states:
certificates, again, the airline office made the necessary request to
Manila on 23 November 1977 for a Hamburg, Paris, Geneva, Rome, WHEREFORE, this Court hereby renders judgment
Paris, Hongkong and Manila route. Still, the request was denied. for the plaintiff and orders the defendant to pay to the
Despite respondent as protest and offer to pay any fare difference, plaintiff the sum of 1,914 German Marks, in its
petitioner did not relent in its position. Respondent, therefore, had to equivalent in Philippine Peso, as actual damages, the
buy an entirely new set of tickets, paying 1,914 German marks for the sum of P 1,000,000.00 as moral damages, and the
homeward route, namely: further sum of P 800,000.00 as exemplary damages,
with legal interest thereon from date of the filing of
Itinerary Carrier Date Reservation the complaint until fully paid, plus the sum equal to
20% thereof as attorney's fees, with costs against the
Hamburg/Frankfurt LH 26 Nov. OK (Lufthansa) plaintiff. 4
On appeal to the Court of Appeals, the award of damages was 1987, private respondent filed his reply memorandum on 17
modified as follows: December 1987. This is the last pleading on record.

ACCORDINGLY, the judgment appealed from is While this Court is not a trier of facts, yet, when the findings of
hereby modified so that it will read as follows: respondent court are without citation of specific evidence on which
Judgment is hereby rendered in favor of the plaintiff they are based, there is sufficient reason for the Court to review the
against the defendant ordering ther defendant to pay appellate court's decision. 6
to said plaintiff the following.
The respondent court's ruling that there was breach of contract of
(1) 1,914 German Marks in its equivalent in carriage is premised on petitioner's refusal to re-route respondent and,
Philippine peso at prevailing rate of exchange as in effect, requiring him to purchase a new set of tickets. Petitioner
actual damages, with legal interest thereon from the refutes this conclusion, claiming that the original ticket
date of the filing of the complaint until fully paid; was discounted and non-endorsable on certain segments. Eventually
respondent flew on his chosen route with different airlines.
(2) P 500,000.00, as moral damages;
Under the factual milieu, was there really a breach of contract of
(3) P 150,000.00, as exemplary damages; and carriage on the part of the petitioner, as to justify the award to private
respondent of actual, moral and exemplary damages? We find none.
(4) 5% of the amount of actual, moral and exemplary
damages which are recoverable, as attorney's fees. 5 International Air Transportation Association (IATA) Resolution No.
275 e, 2., special note reads: "Where a fare is restricted and such
Questioning the factual findings of the respondent court, petitioner restrictions are not clearly evident from the required entries on the
comes to this court for review citing three (3) errors: ticket, such restrictions may be written, stamped or reprinted in plain
language in the Endorsement/Restrictions" box of the applicable flight
1. The conclusion that there is a breach of contract is coupon(s); or attached thereto by use of an appropriate
premised on a misapprehension of facts. notice." 7 Voluntary changes to tickets, 8 while allowable, are also
covered by (IATA) Resolution No. 1013, Art. II, which provides: "1.
2. Failure to apply the doctrine of avoidable changes to the ticket requested by the passenger will be subject to
carriers regulations.
consequence in the present case.
Private respondent wanted a rerouting to Hamburg, Geneva, Rome,
3. Award of exorbitant damages and attorney's fees.
Hongkong and Manilas 9 which shortened the original itinerary on the
ticket issued by AF Manila through ASPAC, its general sales agent.
After considering respondent's comment, the Court resolved to give
Considering the original restrictions on the ticket, it was not
due courses to the petition, and required the parties to file their
unreasonable for Air France to deny the request.
respective memoranda. Complying with the resolution of 26 October
Besides, a recurring ear infection was pleaded as reason necessitating any effort was exerted by the KLM officials or
urgent return to Manila. Assuming arguendo a worsening pain or employees to discharge in a proper manner this
discomfort, private respondent appears to have still proceeded to four responsibility to the respondents. Consequently, We
(4) other cities covering a period of at least six (6) days and leaving hold that the respondents cannot be bound by the
open his date of departure from Hongkong to Manila.10 And, even if provision in question by which KLM unilaterally
he claimed to have undergone medical examination upon arrival in assumed the role of a mere ticket-issuing agent for
Manila, no medical certificate was presented. He failed to even other airlines and limited its liability only to untoward
remember his date of arrival in Manila. occurrences on its own lines. (Emphasis supplied)

With a claim for a large amount of damages, the Court finds it unsual Unlike in the KLM case where the breach of contract was aggravated
for respondent, a lawyer, to easily forget vital information to by the discourteous and arbitrary conduct of an official of the Aer
substantiate his plea. It is also essential before an award of damages Lingus which the KLM had engaged to transport the respondents,
that the claimant must satisfactorily prove during the trial the existence here. Air France employees in Hamburg informed private respondent
of the factual basis of the damages and its causal connection to that his tickets were partly stamped "non-endorsable" and "valid on
defendant's acts.11 Air France only."13 Mere refusal to accede to the passenger's wishes
does not necessarily translate into damages in the absence of bad
In KLM Royal Dutch Airlines v. CA, 12 the Court observed- faith.14 To our mind, respondent has failed to show wanton,
malevolent or reckless misconduct imputable to petitioner in its
.... As noted by the Court of Appeals that condition refusal to re-route.
was printed in letters so small that one would have to
use a magnifying glass to read the words. Under the Air France Manila acted upon the advise of ASPAC in denying private
circumstances, it would be unfair and inequitable to respondent's request. There was no evident bad faith when it followed
charge the respondents with automatic knowledge or the advise not to authorize rerouting.15 At worst, the situation can be
notice of the said condition so as to preclude any considered a case of inadvertence on the part of ASPAC in not
doubt that it was fairly and freely agreed upon by the explaining the non-endorsable character of the ticket. Of importance,
respondents when they accepted the passage tickets however, is the fact that private respondent is a lawyer, and the
issued to them by the KLM. As the airline which restriction box 16 clearly indicated the non-endorsable character of the
issued those tickets with the knowledge that the ticket.
respondents would be flown on the various legs of
their journey by different air carriers, the KLM was Omissions by ordinary passengers may be condoned but more is
chargeable with the duty and responsibility of expected of members of the bar who cannot feign ignorance of such
specifically informing the respondents of conditions limitations and restrictions. An award of moral and exemplary
prescribed in their tickets or in the very least, to damages cannot be sustained under the circumstances, but petitioner
ascertain that the respondent read them before they has to refund the unused coupons in the Air France ticket to the private
accepted their passage tickets. A thorough search of respondent.
the records, however, inexplicably fails to show that
WHEREFORE, the judgement appealed from is REVERSED and
SET ASIDE. Petitioner is ordered, however, to refund to private
respondent the value of the unused coupons in the passenger's ticket
issued to him by the petitioner. No costs.

SO ORDERED.
G.R. No. 145871 January 31, 2006 of 9% to be paid within a period of six months, but since said amount
was insufficient to buy construction materials for the house she was
LEONIDES C. DIÑO, petitioner, then building, she again borrowed an additional amount
vs. of P30,000.00; it was never the intention of respondent to sell her
LINA JARDINES, Respondent. property to petitioner; the value of respondent’s residential house
alone is over a million pesos and if the value of the lot is added, it
DECISION would be around one and a half million pesos; it is unthinkable that
respondent would sell her property worth one and a half million pesos
AUSTRIA-MARTINEZ, J.: for only P165,000.00; respondent has even paid a total of P55,000.00
out of the amount borrowed and she is willing to settle the unpaid
amount, but petitioner insisted on appropriating the property of
This resolves the petition for review on certiorari seeking to set aside
the Decision1 of the Court of Appeals (CA) dated June 9, 2000 respondent which she put up as collateral for the loan; respondent has
dismissing the appeal in CA-G.R. CV No. 56118 and the Resolution been the one paying for the realty taxes on the subject property; and
due to the malicious suit filed by petitioner, respondent suffered moral
dated October 25, 2000 denying the motion for reconsideration.
damages.
The antecedent facts are as follows.
On September 14, 1993, petitioner filed an Amended Complaint
adding allegations that she suffered actual and moral damages. Thus,
On December 14, 1992, Leonides C. Diño (petitioner) filed a Petition
she prayed that she be declared the absolute owner of the property
for Consolidation of Ownership with the Regional Trial Court of
and/or that respondent be ordered to pay her P165,000.00 plus the
Baguio City, Branch 7 (RTC). She alleged that: on January 31, 1987,
agreed monthly interest of 10%; moral and exemplary damages,
Lina Jardines (respondent) executed in her favor a Deed of Sale
attorney’s fees and expenses of litigation.
with Pacto de Retro over a parcel of land with improvements thereon
covered by Tax Declaration No. 44250, the consideration for which
amounted to P165,000.00; it was stipulated in the deed that the period Respondent then filed her Answer to the Amended Complaint
for redemption would expire in six months or on July 29, 1987; such reiterating the allegations in her Answer but increasing the alleged
period expired but neither respondent nor any of her legal valuation of the subject property to more than two million pesos.
representatives were able to redeem or repurchase the subject
property; as a consequence, absolute ownership over the property has After trial, the RTC rendered its Decision dated November 20, 1996,
been consolidated in favor of petitioner.2 the dispositive portion of which reads as follows:

Respondent countered in her Answer that: the Deed of Sale with Pacto WHEREFORE, in view of all the foregoing, judgment is hereby
de Retro did not embody the real intention of the parties; the rendered as follows:
transaction actually entered into by the parties was one of simple loan
and the Deed of Sale with Pacto de Retro was executed just as a a) Declaring the contract (Exh. A) entered into by the
security for the loan; the amount borrowed by respondent during the contending parties as one of deed of sale with right to
first week of January 1987 was only P50,000.00 with monthly interest repurchase or pacto de retro sale;
 b) Declaring the plaintiff Diño to have acquired whatever SO ORDERED.3
rights Jardines has over the parcel of land involved it being
that Jardines has no torrens title yet over said land; Respondent then appealed to the CA which reversed the RTC
judgment. The CA held that the true nature of the contract between
c) Declaring the plaintiff Diño the owner of the residential herein parties is one of equitable mortgage, as shown by the fact that
house and other improvements standing on the parcel of land (a) respondent is still in actual physical possession of the property; (b)
in question; respondent is the one paying the real property taxes on the property;
and (c) the amount of the supposed sale price, P165,000.00, earns
d) Ordering the consolidation of ownership of Diño over the monthly interest. The dispositive portion of the CA Decision
residential house and other improvements, and over the rights, promulgated on June 9, 2000 reads:
she (Diño) acquired over the parcel of land in question; and
ordering the corresponding government official (The City WHEREFORE, foregoing premises considered, we find that the
Assessor) of Baguio City to undertake the consolidation by Regional Trial Court, First Judicial Region, Branch 07, Baguio City,
putting in the name of plaintiff Diño the ownership and/or committed reversible errors in rendering its decision dated 20
rights which she acquired from the defendant Jardines in the November 1996 in Civil Case No. 2669-R, entitled Leonides G. Diño,
corresponding document (Tax Declarations) on file in his/her etc. vs. Lina Jardines". The appeal at bar is herby GRANTED and the
office; after the plaintiff has complied with all the assailed decision is hereby REVERSED and SET ASIDE. Let a new
requirements and has paid the fees necessary or incident to the judgment be entered as follows:
issuance of a new tax declaration as required by law;
1. Declaring that the true nature of the contract entered into
e) Ordering the cancellation of Tax Declaration 44250; by the contending parties as one of equitable mortgage and
not a pacto de retro sale;
f) Ordering defendant Jardines to pay actual and/or
compensatory damages to the plaintiff as follows: 2. Ordering the defendant-appellant to pay plaintiff-appellee
legal interest on the amount of P165,000.00 from July 29,
1) P3,000.00 representing expenses in going to and 1987, the time the said interest fell due, until fully paid;
from Jardines’ place to collect the redemption money;
3. No pronouncement as to cost.
2) P1,000.00 times the number of times Diño came to
Baguio to attend the hearing of the case as evidenced SO ORDERED.4
by the signatures of Diño appearing on the minutes of
the proceedings found in the Rollo of the case; Petitioner moved for reconsideration of said decision, but the same
was denied per Resolution dated October 25, 2000.
3) P10,000.00 attorney’s fee.
Hence, herein petition for review on certiorari alleging that:
Costs against defendant Jardines.
 1. THE LOWER COURT COMMITTED AN ERROR IN only P93,080.00. The fact that respondent has remained in actual
DECLARING THAT THE TRUE NATURE OF THE physical possession of the property in question, and that respondent
CONTRACT ENTERED INTO BY THE PARTIES AS ONE has been the one paying the real property taxes on the subject property
EQUITABLE MORTGAGE AND NOT A PACTO DE was established by the admission made by petitioner during the pre-
RETRO SALE; trial conference and embodied in the Pre-Trial Order6 dated May 25,
1994. The finding that the purchase price in the amount
2. THE LOWER COURT COMMITTED AN ERROR IN of P165,000.00 earns monthly interest was based on petitioner’s own
ORDERING THE RESPONDENT TO PAY PETITIONER testimony and admission in her appellee’s brief that the amount
LEGAL INTEREST DESPITE THE CONFLICTING of P165,000.00, if not paid on July 29, 1987, shall bear an interest of
ADMISSIONS OF THE PARTIES THAT THE AGREED 10% per month.
INTERESTS WAS EITHER 9% OR 10%;
The Court sees no reversible error with the foregoing findings of fact
3. THE FINDINGS OF FACTS OF THE LOWER COURT made by the CA. The CA correctly ruled that the true nature of the
ARE CONTRARY TO EVIDENCE AND THE contract entered into by herein parties was one of equitable mortgage.
ADMISSIONS OF THE PARTIES;
Article 1602 of the Civil Code enumerates the instances when a
4. THE LOWER COURT COMMITTED AN ERROR IN purported pacto de retro sale may be considered an equitable
GOING BEYOND THE ISSUES OF THE CASE BY mortgage, to wit:
DELETING THE AWARD FOR DAMAGES DESPITE
THE FACT THAT THE SAME WAS NOT RAISED AS AN Art. 1602. The contract shall be presumed to be an equitable mortgage,
ISSUE IN THE APPEAL; 5 in any of the following cases:

The petition lacks merit. (1) When the price of a sale with right to repurchase is
unusually inadequate;
The Court finds the allegations of petitioner that the findings of fact
of the CA are contrary to evidence and admissions of the parties and (2) When the vendor remains in possession as lessee or
that it erred in declaring the contract between the parties as an otherwise;
equitable mortgage to be absolutely unfounded.
(3) When upon or after the expiration of the right to
A close examination of the records of this case reveals that the findings repurchase another instrument extending the period of
of fact of the CA are all based on documentary evidence and on redemption or granting a new period is executed;
admissions and stipulation of facts made by the parties. The CA’s
finding that there was no gross inadequacy of the price of respondent’s (4) When the purchaser retains for himself a part of the
residential house as stated in the contract, was based on respondent’s purchase price;
own evidence, Tax Declaration No. 44250, which stated that the actual
market value of subject residential house in 1986 was
 (5) When the vendor binds himself to pay the taxes on the The allegation that the appellate court should not have deleted the
thing sold; award for actual and/or compensatory damages is likewise
unmeritorious.
(6) In any other case where it may be fairly inferred that the
real intention of the parties is that the transaction shall secure Section 8, Rule 51 of the Rules of Court provides as follows:
the payment of a debt or the performance of any other
obligation. Sec. 8. Questions that may be decided. – No error which does not
affect the jurisdiction over the subject matter or the validity of the
In any of the foregoing cases, any money, fruits, or other benefit to be judgment appealed from or the proceedings therein will be considered
received by the vendee as rent or otherwise shall be considered as unless stated in the assignment of errors, or closely related to or
interest which shall be subject to the usury laws. (Emphasis supplied) dependent on an assigned error and properly argued in the brief, save
as the court may pass upon plain errors and clerical errors.
In Legaspi vs. Ong,7 the Court further explained that:
Clearly, the appellate court may pass upon plain errors even if they are
The presence of even one of the above-mentioned circumstances as not stated in the assignment of errors. In Villegas vs. Court of
enumerated in Article 1602 is sufficient basis to declare a contract of Appeals,10 the Court held:
sale with right to repurchase as one of equitable mortgage. As stated
by the Code Commission which drafted the new Civil Code, in [T]he Court is clothed with ample authority to review matters, even if
practically all of the so-called contracts of sale with right of they are not assigned as errors in the appeal, if it finds that their
repurchase, the real intention of the parties is that the pretended consideration is necessary in arriving at a just decision of the case. 11
purchase price is money loaned and in order to secure the payment of
the loan, a contract purporting to be a sale with pacto de retro is drawn In the present case, the RTC’s award for actual damages is a plain
up.8 error because a reading of said trial court’s Decision readily discloses
that there is no sufficient evidence on record to prove that petitioner is
In the same case, the Court cited Article 1603 of the Civil Code, which entitled to the same. Petitioner’s only evidence to prove her claim for
provides that in case of doubt, a contract purporting to be a sale with actual damages is her testimony that she has spent P3,000.00 in going
right to repurchase shall be construed as an equitable mortgage. 9 to and from respondent’s place to try to collect payment and that she
spent P1,000.00 every time she travels from Bulacan, where she
In the instant case, the presence of the circumstances provided for resides, to Baguio in order to attend the hearings.
under paragraphs (2) and (5) of Article 1602 of the Civil Code, and
the fact that petitioner herself demands payment of interests on the In People vs. Sara,12 the Court held that a witness’ testimony cannot
purported purchase price of the subject property, clearly show that the be "considered as competent proof and cannot replace the probative
intention of the parties was merely for the property to stand as security value of official receipts to justify the award of actual damages, for
for a loan. The transaction between herein parties was then correctly jurisprudence instructs that the same must be duly substantiated by
construed by the CA as an equitable mortgage. receipts."13 Hence, there being no official receipts whatsoever to
support petitioner’s claim for actual or compensatory damages, said reduced the 7% interest per month on a P15,000.00 loan amounting to
claim must be denied. 84% interest per annum to 18% per annum.

The appellate court was also correct in ordering respondent to pay There is no need to unsettle the principle affirmed in Medel and like
"legal interest" on the amount of P165,000.00. cases. From that perspective, it is apparent that the stipulated interest
in the subject loan is excessive, iniquitous, unconscionable and
Both parties admit that they came to an agreement whereby respondent exorbitant. Pursuant to the freedom of contract principle embodied in
shall pay petitioner interest, at 9% (according to respondent) or 10% Article 1306 of the Civil Code, contracting parties may establish such
(according to petitioner) per month, if she is unable to pay the stipulations, clauses, terms and conditions as they may deem
principal amount of P165,000.00 on July 29, 1987. convenient, provided they are not contrary to law, morals, good
customs, public order, or public policy. In the ordinary course, the
In the Pre-Trial Order14 dated May 25, 1994, one of the issues for codal provision may be invoked to annul the excessive stipulated
resolution of the trial court was "whether or not the interest to be paid interest.
under the agreement is 10% or 9% or whether or not this amount of
interest shall be reduced equitably pursuant to law."15 In the case at bar, the stipulated interest rate is 6% per month, or 72%
per annum. By the standards set in the above-cited cases, this
The factual milieu of Carpo vs. Chua16 is closely analogous to the stipulation is similarly invalid. x x x. 18
present case. In the Carpo case, petitioners therein contracted a loan
in the amount of P175,000.00 from respondents therein, payable Applying the afore-cited rulings to the instant case, the inescapable
within six months with an interest rate of 6% per month. The loan was conclusion is that the agreed interest rate of 9% per month or 108%
not paid upon demand. Therein petitioners claimed that following the per annum, as claimed by respondent; or 10% per month or 120% per
Court’s ruling in Medel vs. Court of Appeals,17 the rate of interest of annum, as claimed by petitioner, is clearly excessive, iniquitous,
6% per month or 72% per annum as stipulated in the principal loan unconscionable and exorbitant. Although respondent admitted that she
agreement is null and void for being excessive, iniquitous, agreed to the interest rate of 9%, which she believed was exorbitant,
unconscionable and exorbitant. The Court then held thus: she explained that she was constrained to do so as she was badly in
need of money at that time. As declared in
In a long line of cases, this Court has invalidated similar stipulations the Medel case19 and Imperial vs. Jaucian,20 "[i]niquitous and
on interest rates for being excessive, iniquitous, unconscionable and unconscionable stipulations on interest rates, penalties and attorney’s
exorbitant. In Solangon v. Salazar, we annulled the stipulation of 6% fees are contrary to morals." Thus, in the present case, the rate of
per month or 72% per annum interest on a P60,000.00 loan. interest being charged on the principal loan of P165,000.00, be it 9%
In Imperial v. Jaucian, we reduced the interest rate from 16% to or 10% per month, is void. The CA correctly reduced the exhorbitant
1.167% per month or 14% per annum. In Ruiz v. Court of Appeals, we rate to "legal interest."
equitably reduced the agreed 3% per month or 36% per annum interest
to 1% per month or 12% per annum interest. The 10% and 8% interest In Trade & Investment Development Corporation of the Philippines
rates per month on a P1,000,000.00 loan were reduced to 12% per vs. Roblett Industrial Construction Corporation,21 the Court held that:
annum in Cuaton v. Salud. Recently, this Court, in Arrofo v. Quino,
In Eastern Shipping Lines, Inc. v. Court of Appeals, this Court laid (1) When the obligation or the law expressly so declares; or
down the following rules with respect to the manner of computing
legal interest: (2) When from the nature and the circumstances of the
obligation it appears that the designation of the time when the
I. When an obligation, regardless of its source, i.e., law, contracts, thing is to be delivered or the service is to be rendered was a
quasi-contracts, delicts or quasi-delicts is breached, the contravenor controlling motive for the establishment of the contract; or
can be held liable for damages. The provisions under Title XVIII on
'Damages' of the Civil Code govern in determining the measure of (3) When demand would be useless, as when the obligor has
recoverable damages. rendered it beyond his power to perform.

II. With regard particularly to an award of interest in the concept of xxxx

actual and compensatory damages, the rate of interest, as well as the
accrual thereof, is imposed, as follows: The records do not show any of the circumstances enumerated above.
Consequently, the 12% interest should be reckoned from the date of
1. When the obligation is breached, and it consists in the payment extrajudicial demand.
of a sum of money, i.e., a loan or forbearance of money, the
interest due should be that which may have been stipulated in Petitioner testified that she went to respondent’s place several times to
writing. Furthermore, the interest due shall itself earn legal interest try to collect payment, but she (petitioner) failed to specify the dates
from the time it is judicially demanded. In the absence of stipulation, on which she made such oral demand. The only evidence which
the rate of interest shall be 12% per annum to be computed from clearly shows the date when petitioner made a demand on respondent
default, i.e., from judicial or extrajudicial demand under and subject is the demand letter dated March 19, 1989 (Exh. "C"), which was
to the provisions of Article 1169 of the Civil Code. 22 (Underscoring received by respondent or her agent on March 29, 1989 per the
supplied) Registry Return Receipt (Exh. "C-1"). Hence, the interest of 12% per
annum should only begin to run from March 29, 1989, the date
Applied to the present case, since the agreed interest rate is void, the respondent received the demand letter from petitioner.
parties are considered to have no stipulation regarding the interest rate.
Thus, the rate of interest should be 12% per annum to be computed WHEREFORE, the petition is hereby DENIED. The Decision of the
from judicial or extrajudicial demand, subject to the provisions of Court of Appeals dated June 9, 2000 is AFFIRMED with
Article 1169 of the Civil Code, to wit: the MODIFICATION that the legal interest rate to be paid by
respondent on the principal amount of P165,000.00 is twelve (12%)
Art. 1169. Those obliged to deliver or to do something incur in delay percent per annum from March 29, 1989 until fully paid.
from the time the obligee judicially or extrajudicially demands from
them the fulfillment of the obligation. SO ORDERED.

However, the demand by the creditor shall not be necessary in order

that delay may exist:
[G.R. No. 55613 : December 10, 1990.] of said settlement, 4/6 of the entire land or 11.2477 hectares was
adjudicated to Vivencia Prila, 1/6 or 2.8119 hectares to Asuncion
192 SCRA 169
Pacamara and another 1/6 or 2.8119 hectares to Custodio Parcia. This
ERNESTO DICHOSO, Petitioner, vs. The HONORABLE stipulation was reiterated by both Vivencia Prila and Asuncion
COURT OF APPEALS and TEODOLFO RAMOS, Respondents. Pacamara in an agreement dated March 29, 1947 duly registered with
the Register of Deeds on June 22, 1947 and was furthermore
confirmed judicially by the Court of First Instance of Camarines Sur,
DECISION in Civil Cases Nos. 3370 and 4468.
PARAS, J.: In 1955, Vivencia Prila sold her 4/6 portion with an area of 11.2477
This is a petition for Certiorari of the July 8, 1980 decision ** of the hectares to the petitioner Ernesto Dichoso who had been, ever since,
Court of Appeals which affirmed the November 3, 1975 decision *** in actual physical possession thereof, exercising various acts of
of the then Court of First Instance of Camarines Sur, the dispositive ownership thereon.
portion of which reads, as follows: On the other hand, in a Deed of Sale dated June 17, 1948, Asuncion
"WHEREFORE, judgment is hereby rendered declaring the Pacamara sold to the wife of private respondent Teodolfo Ramos her
plaintiff owner of the land described in paragraph 2 of the 1/6 share, but the deed mentions the area of the lot sold as 4.1250
complaint; and ordering the defendants, Ernesto Dichoso and hectares; obviously in excess of Pacamara's 1/6 share in the property
Marcelino Enciso, to restitute the possession of the land to the of 2.8119 hectares. Hence, aforesaid 4.1250 hectares which Ramos
plaintiff and to deliver to the plaintiff 40 cavans of palay for claims to have possessed, is now the land in question.
every year from 1964 until the land in question is returned to As described in Ramos' Deed of Sale dated June 17, 1948, the land
the latter or their equivalent value of P15.00 per cavan of bought by his wife is as follows:
palay. With costs against the said defendants.
"Cogon land situated in the barrio of Cagmanaba, Municipality of Pili,
SO ORDERED." Province of Camarines Sur, with an area of approximately 4 hectares,
(CA Decision, Rollo, p. 14).- nad 12 ares, and 50 centares, and is bounded on the North by a dam, limited
by the same dam, measuring 120 meters; on the East, Cagmanaba
The facts of the case are as follows: River, limited by the same river, measuring 200 meters; on the South,
The spouses Gaspar Prila and Maria Beldad, owned a 16.8716 hectare heirs of Gaspar Prila and Mariano Rodriguez, limited by an irrigation
parcel of land at Cagmanaba, Ocampo, Camarines Sur, surveyed in ditch, measuring 200 meters; on the West, heirs of Gaspar Prila and
the name of Gaspar Prila under Plan Psu-61453 (Exhibit "2"). Upon limited by a big stone, measuring 350 meters." (Exhibit "A", Original
the death of Maria Beldad in 1925, the eastern half thereof was given Records)
to Vivencia Prila, their only daughter, and when Gaspar Prila died in The said Deed of Absolute Sale was notarized and registered with the
1943, the 1/2 portion pertaining to him was divided into three: one Register of Deeds of Camarines Sur on August 2, 1948. Realty taxes
third to Vivencia Prila, one third to Asuncion Pacamara and the other for the years 1956-1960 were paid on July 22, 1960 and for the years
one-third to Custodia Parcia, as reflected in the Extra-judicial 1961-1962 on November 18, 1964 (CA Decision, Rollo, p. 15).
Settlement of Estate executed on November 22, 1945. Under the terms
Herein respondent Teodolfo Ramos took possession of the contested of First Instance of Camarines Sur which was docketed as Civil Case
riceland upon its purchase. It yielded an average harvest of 20 sacks No. P-20. A commissioner was appointed by the Court on March 17,
of palay per planting which was twice a year. One-third of the harvest 1970 to determine the area and boundaries of the respective claims of
went to Ramos and the remaining two-thirds was the tenant's share the parties in accordance with their monuments of title. He submitted
(Rollo, pp. 15-16). his report on March 31, 1970 which was approved by the Court in its
Order dated April 13, 1970.
On the other hand, petitioner Ernesto Dichoso claims that the disputed
land is inside his property of 11.2477 hectares which he acquired from As aforestated, the trial court rendered its decision on November 3,
Vivencia Prila for P2,000.00 and evidenced by a Deed of Absolute 1975 in favor of Ramos and against Dichoso (Rollo, pp. 14-15).
Sale dated February 9, 1955, which was more particularly described
On appeal, the Court of Appeals, on July 8, 1980, affirmed the
as follows:
decision of the trial court (CA Decision, Rollo, p. 14).
"BEING the eastern portion of Plan PSU-61453 BOUNDED on the
Hence, this petition.
North by Joaquin Interino before, now Mariano Rodriguez; on the East
by Cagdaga Creek, on the other side of which is Mariano Rodriguez, Petitioner assigned two (2) errors, namely:
before heirs of Mariano Fuentebella; on the South by heirs of Mariano I
Fuentebella before, now Mariano Rodriguez; on the West by the rest
of Plan PSU-61453, namely Asuncion Pacamara before, now Rodolfo THE HONORABLE COURT OF APPEALS ERRED IN FINDING
Ramos. CONTAINING an area exactly ELEVEN (11) hectares, THAT PRIVATE RESPONDENT TEODOLFO RAMOS IS THE
TWENTY-FOUR (24) ares, and SEVENTY-SEVEN (77) centares. OWNER OF THE 4.1250 HECTARE LAND IN QUESTION.
DECLARED under Tax Declaration No. 1648 in the name of II
Alejandro Casin and assessed at P3,450.00. All boundaries are marked
and delimited by B.L. and P.L.S. concrete cylindrical monuments. The THE HONORABLE COURT OF APPEALS ERRED IN
foregoing property is not registered under Act No. 496 nor under the REQUIRING THE PETITIONER TO DELIVER FORTY (40)
Spanish Mortgage Law; wherefore, the parties herein have agreed to CAVANS ANNUALLY TO PRIVATE RESPONDENT DESPITE
register this instrument under the provisions of Act No. 3344, as ITS FINDING THAT ONLY ONE-THIRD (1/3) OF THE
amended." (Exhibit "1", Original Records).:-cralaw PRODUCE "WENT TO" THE PLAINTIFF (RAMOS), TWO-
THIRDS (2/3) BEING FOR HIS TENANT.
Sometime in 1962, Teodolfo Ramos, in the company of a constabulary
soldier and two policemen from Ocampo, allegedly seized the produce The petition is impressed with merit.
of the land consisting of 50 cavans of palay from the tenant of herein It is undisputed that the land in question is part of the bigger mass of
petitioner. land measuring 16.8716 hectares originally owned by the spouses
In retaliation, petitioner Dichoso also brought along with him in 1963, Gaspar Prila and Maria Beldad, and that this mass of land was
a constabulary soldier and appropriated 6 cavans of the produce (CA adjudicated among the heirs in the proportion aforementioned. And
Decision, Rollo, p. 17). that Dichoso derived his title from Vivencia Prila while Ramos
acquired his title from Asuncion Pacamara.
On December 12, 1967, respondent Ramos filed a complaint for
quieting of title over the 4.1250 hectare riceland before the then Court
Dichoso contends that his claim is limited to 11.2477 hectares portion with the land bought by Ramos' wife. It must be pointed out, however,
sold to him by Vivencia Prila which is exactly four-sixth (4/6) of the that the deed of sale in favor of Ramos' wife explicitly described the
16.8716 hectares originally owned by their common predecessor-in property as being bounded "on the South (by) heirs of Gaspar Prila
interest. Ramos acquired his title from Asuncion Pacamara, who and Mariano Rodriguez, limited by an irrigation ditch, measuring 200
inherited one-sixth (1/6) of the 16.8716 hectares mass of land. meters; on the West (by) heirs of Gaspar Prila, limited by a big stone,
Inasmuch as the share of Asuncion Pacamara is limited to one-sixth measuring 350 meters." The commissioner's report (Exhibit "11")
(1/6) of the 16.8716 hectares, or 2.8119 hectares, she cannot legally identified the land claimed by Ramos and indicated in the sketch as
transmit to Ramos an area in excess thereof. the portion surrounded by a red line inside Lot-3, the portion
pertaining to Dichoso. As indicated in the said sketch the land of
Ramos, on the other hand, argues that while it is true that Asuncion
Dichoso is labelled as Lots-1 and 3 and the portion labelled as Lot-2
Pacamara's share is one-sixth (1/6) pursuant to the Extra-Judicial
is the land of Ramos. A further scrutiny of Exhibit "11" shows that the
Settlement Agreement, but on a subsequent agreement (Exhibit "13"),
area being claimed by Ramos, which was enclosed by a red line, went
Vivencia Prila ceded to Asuncion Pacamara one hectare more located
beyond the irrigation ditch. This is contrary to the technical
on the northern portion of the land covered by Original Certificate of
description in the deed of sale in favor of Ramos' wife as to the
Title No. 1176. In effect, Asuncion Pacamara owns at least six (6)
boundary on the southern portion of the property (Original Exhibits,
hectares of land. Furthermore, the Deed of Conveyance was registered
Exhibit "11").
on August 2, 1948 and the property has been declared for tax purposes
in the name of Ramos' wife. Above all these, the question raised by While the jurisdiction of this Court in cases brought from the Court of
Dichoso is purely a question of fact.:- nad Appeals is limited to the review of errors of law, said appellate court's
finding of facts being conclusive, there are exceptions, among which
The records show, however, that the one hectare ceded by Vivencia
are: (1) when the conclusion is a finding grounded entirely on
Prila to Asuncion Pacamara on the northern portion of the land
speculation, surmises or conjectures; (2) when the inference made is
supposed to be covered by Original Certificate of Title No. 1176, is
manifestly absurd, mistaken, or impossible; (3) . . .; (4) when the
not the same land covered by said Original Certificate of Title
judgment is premised on a misapprehension of facts; (5) . . ., (Rizal
(Original Exhibits, Exhibit "3", p. 1) Therefore, while it may be true
Cement, Co., Inc. vs. Villareal, 135 SCRA 15, February 28, 1985).
that Asuncion Pacamara may have been adjudicated a total of six (6)
hectares of land, but what is covered by Original Certificate of Title This Court has held that in cases of conflict between areas and
No. 1176 pursuant to the Extra-Judicial Settlement Agreement and the boundaries, it is the latter which should prevail. What really defines a
agreement subsequent thereto insofar as Vivencia Prila's share is piece of ground is not the area, calculated with more or less certainty,
concerned, remains to be one-sixth (1/6) or 2.8119 hectares (Original mentioned in its description, but the boundaries therein laid down, as
Exhibits, Exhibit "3", p. 4). enclosing the land and indicating its limits (Erico v. Chigas, 98 SCRA
575, July 16, 1980). In a contract of sale of land in a mass, it is well
The striking similarities in the boundaries between the parcel of land
established that the specific boundaries stated in the contract must
in dispute and the property of Ramos' wife, particularly the boundaries
control over any statement with respect to the area contained within
on the North, which is the dam, and on the East, which is the
its boundaries. It is not of vital consequence that a deed or contract of
Cagmanaba River, and the fact that the deed of sale in favor of Ramos'
sale of land should disclose the area with mathematical accuracy. It is
wife was executed and registered ahead of that of Dichoso's deed of
sufficient if its extent is objectively indicated with sufficient precision
sale, led the trial court to conclude that the property in dispute tallies
to enable one to identify it. An error as to the superficial area is
immaterial. (Loyola v. Bartolome, 39 Phil. 544, January 24, 1919
reiterated in Erico v. Chigas, supra).
With reference to the second error, petitioner alleged that since
respondent's share of the harvest is only one-third (1/3), the remaining
two-thirds (2/3) representing his tenant's share, only the one-third
(1/3) of the annual harvest must be awarded to Ramos.
Ramos, on the other hand, argues that his tenant will be deprived of
his share if only one-third (1/3) of the harvest will be awarded to him.
Actual or compensatory damages cannot be presumed, but must be
duly proved, and proved with reasonable degree of certainty. A court
cannot rely on speculation, conjecture or guesswork as to the fact and
amount of damages, but must depend upon competent proof that they
have suffered and on evidence of the actual amount thereof (Dee Hua
Liong Electrical Corporation v. Reyes, 145 SCRA 713, November 25,
1986).: nad
It is undisputed that the land in question yields an average of twenty
(20) sacks of palay per planting and that it is planted to palay twice a
year. Ramos' share of the harvest is only one-third (1/3). In view of his
dispossession from 1964 and the fact that his tenant has vacated the
land that same year (TSN, Hearing of February 10, 1971, pp. 2-3), he
cannot allege that his tenant is entitled to his two-thirds (2/3) share.
PREMISES CONSIDERED, the decision appealed from is hereby
SET ASIDE and the area of the land awarded to herein respondent
Ramos is hereby LIMITED to 2.8119 hectares in accordance with the
boundaries indicated in the deed of sale in favor of his wife, and the
award of actual damages is hereby REDUCED in proportion to the
area that may be awarded to Ramos and to his one-third (1/3)
participation in the harvests, from 1964 up to the time the land
appurtenant thereto is returned to the respondent.
SO ORDERED.
G.R. No. 118342 January 5, 1998 1. Plaintiff Lydia P. Cuba is a grantee of a Fishpond
Lease Agreement No. 2083 (new) dated May 13,
DEVELOPMENT BANK OF THE PHILIPPINES, petitioner, 1974 from the Government;
vs.
COURT OF APPEALS and LYDIA CUBA, respondents. 2. Plaintiff Lydia P. Cuba obtained loans from the
Development Bank of the Philippines in the amounts
G.R. No. 118367 January 5, 1998 of P109,000.00; P109,000.00; and P98,700.00 under
the terms stated in the Promissory Notes dated
LYDIA P. CUBA, petitioner, September 6, 1974; August 11, 1975; and April 4,
vs. 1977;
COURT OF APPEALS, DEVELOPMENT BANK OF THE
PHILIPPINES and AGRIPINA P. CAPERAL, respondents. 3. As security for said loans, plaintiff Lydia P. Cuba
executed two Deeds of Assignment of her Leasehold
Rights;

DAVIDE, JR., J.: 4. Plaintiff failed to pay her loan on the scheduled
dates thereof in accordance with the terms of the
These two consolidated cases stemmed from a complaint1 filed against Promissory Notes;
the Development Bank of the Philippines (hereafter DBP) and
Agripina Caperal filed by Lydia Cuba (hereafter CUBA) on 21 May 5. Without foreclosure proceedings, whether judicial
1985 with the Regional Trial Court of Pangasinan, Branch 54. The or extra-judicial, defendant DBP appropriated the
said complaint sought (1) the declaration of nullity of DBP's Leasehold Rights of plaintiff Lydia Cuba over the
appropriation of CUBA's rights, title, and interests over a 44-hectares fishpond in question;
fishpond located in Bolinao, Pangasinan, for being violative of Article
2088 of the Civil Code; (2) the annulment of the Deed of Conditional 6. After defendant DBP has appropriated the
Sale executed in her favor by DBP; (3) the annulment of DBP's sale Leasehold Rights of plaintiff Lydia Cuba over the
of the subject fishpond to Caperal; (4) the restoration of her rights, fishpond in question, defendant DBP, in turn,
title, and interests over the fishpond; and (5) the recovery of damages, executed a Deed of Conditional Sale of the Leasehold
attorney's fees, and expenses of litigation. Rights in favor of plaintiff Lydia Cuba over the same
fishpond in question;
After the joinder of issues following the filing by the parties of their
respective pleadings, the trial court conducted a pre-trial where CUBA 7. In the negotiation for repurchase, plaintiff Lydia
and DBP agreed on the following facts, which were embodied in the Cuba addressed two letters to the Manager DBP,
pre-trial order:2 Dagupan City dated November 6, 1979 and
December 20, 1979. DBP thereafter accepted the
offer to repurchase in a letter addressed to plaintiff 14. That the DBP thereafter executed a Deed of
dated February 1, 1982; Conditional Sale in favor of defendant Agripina
Caperal on August 16, 1984;
8. After the Deed of Conditional Sale was executed in
favor of plaintiff Lydia Cuba, a new Fishpond Lease 15. Thereafter, defendant Caperal was awarded
Agreement No. 2083-A dated March 24, 1980 was Fishpond Lease Agreement No. 2083-A on December
issued by the Ministry of Agriculture and Food in 28, 1984 by the Ministry of Agriculture and Food.
favor of plaintiff Lydia Cuba only, excluding her
husband; Defendant Caperal admitted only the facts stated in paragraphs 14 and
15 of the pre-trial order.3
9. Plaintiff Lydia Cuba failed to pay the amortizations
stipulated in the Deed of Conditional Sale; Trial was thereafter had on other matters.

10. After plaintiff Lydia Cuba failed to pay the The principal issue presented was whether the act of DBP in
amortization as stated in Deed of Conditional Sale, appropriating to itself CUBA's leasehold rights over the fishpond in
she entered with the DBP a temporary arrangement question without foreclosure proceedings was contrary to Article 2088
whereby in consideration for the deferment of the of the Civil Code and, therefore, invalid. CUBA insisted on an
Notarial Rescission of Deed of Conditional Sale, affirmative resolution. DBP stressed that it merely exercised its
plaintiff Lydia Cuba promised to make certain contractual right under the Assignments of Leasehold Rights, which
payments as stated in temporary Arrangement dated was not a contract of mortgage. Defendant Caperal sided with DBP.
February 23, 1982;
The trial court resolved the issue in favor of CUBA by declaring that
11. Defendant DBP thereafter sent a Notice of DBP's taking possession and ownership of the property without
Rescission thru Notarial Act dated March 13, 1984, foreclosure was plainly violative of Article 2088 of the Civil Code
and which was received by plaintiff Lydia Cuba; which provides as follows:

12. After the Notice of Rescission, defendant DBP Art. 2088. The creditor cannot appropriate the things
took possession of the Leasehold Rights of the given by way of pledge or mortgage, or dispose of
fishpond in question; them. Any stipulation to the contrary is null and void.

13. That after defendant DBP took possession of the It disagreed with DBP's stand that the Assignments of Leasehold
Leasehold Rights over the fishpond in question, DBP Rights were not contracts of mortgage because (1) they were given as
advertised in the SUNDAY PUNCH the public security for loans, (2) although the "fishpond land" in question is still
bidding dated June 24, 1984, to dispose of the a public land, CUBA's leasehold rights and interest thereon are
property; alienable rights which can be the proper subject of a mortgage; and (3)
the intention of the contracting parties to treat the Assignment of
Leasehold Rights as a mortgage was obvious and unmistakable; the said Bureau to terminate CUBA's leasehold rights and to approve
hence, upon CUBA's default, DBP's only right was to foreclose the the Deed of Conditional Sale in favor of CUBA. And considering that
Assignment in accordance with law. by reason of her unlawful ejectment by DBP, CUBA "suffered moral
shock, degradation, social humiliation, and serious anxieties for which
The trial court also declared invalid condition no. 12 of the she became sick and had to be hospitalized" the trial court found her
Assignment of Leasehold Rights for being a clear case of pactum entitled to moral and exemplary damages. The trial court also held that
commissorium expressly prohibited and declared null and void by CUBA was entitled to P100,000 attorney's fees in view of the
Article 2088 of the Civil Code. It then concluded that since DBP never considerable expenses she incurred for lawyers' fees and in view of
acquired lawful ownership of CUBA's leasehold rights, all acts of the finding that she was entitled to exemplary damages.
ownership and possession by the said bank were void. Accordingly,
the Deed of Conditional Sale in favor of CUBA, the notarial rescission In its decision of 31 January 1990,4 the trial court disposed as follows:
of such sale, and the Deed of Conditional Sale in favor of defendant
Caperal, as well as the Assignment of Leasehold Rights executed by WHEREFORE, judgment is hereby rendered in favor
Caperal in favor of DBP, were also void and ineffective. of plaintiff:

As to damages, the trial court found "ample evidence on record" that 1. DECLARING null and void and without any legal
in 1984 the representatives of DBP ejected CUBA and her caretakers effect the act of defendant Development Bank of the
not only from the fishpond area but also from the adjoining big house; Philippines in appropriating for its own interest,
and that when CUBA's son and caretaker went there on 15 September without any judicial or extra-judicial foreclosure,
1985, they found the said house unoccupied and destroyed and plaintiff's leasehold rights and interest over the
CUBA's personal belongings, machineries, equipment, tools, and fishpond land in question under her Fishpond Lease
other articles used in fishpond operation which were kept in the house Agreement No. 2083 (new);
were missing. The missing items were valued at about P550,000. It
further found that when CUBA and her men were ejected by DBP for 2. DECLARING the Deed of Conditional Sale dated
the first time in 1979, CUBA had stocked the fishpond with 250,000 February 21, 1980 by and between the defendant
pieces of bangus fish (milkfish), all of which died because the DBP Development Bank of the Philippines and plaintiff
representatives prevented CUBA's men from feeding the fish. At the (Exh. E and Exh. 1) and the acts of notarial rescission
conservative price of P3.00 per fish, the gross value would have been of the Development Bank of the Philippines relative
P690,000, and after deducting 25% of said value as reasonable to said sale (Exhs. 16 and 26) as void and ineffective;
allowance for the cost of feeds, CUBA suffered a loss of P517,500. It
then set the aggregate of the actual damages sustained by CUBA at 3. DECLARING the Deed of Conditional Sale dated
P1,067,500. August 16, 1984 by and between the Development
Bank of the Philippines and defendant Agripina
The trial court further found that DBP was guilty of gross bad faith in Caperal (Exh. F and Exh. 21), the Fishpond Lease
falsely representing to the Bureau of Fisheries that it had foreclosed Agreement No. 2083-A dated December 28, 1984 of
its mortgage on CUBA's leasehold rights. Such representation induced defendant Agripina Caperal (Exh. 23) and the
Assignment of Leasehold Rights dated February 12, 6. And ORDERING defendant Development Bank of
1985 executed by defendant Agripina Caperal in the Philippines to reimburse and pay to defendant
favor of the defendant Development Bank of the Agripina Caperal the sum of ONE MILLION FIVE
Philippines (Exh. 24) as void ab initio; HUNDRED THIRTY-TWO THOUSAND SIX
HUNDRED TEN PESOS AND SEVENTY-FIVE
4. ORDERING defendant Development Bank of the CENTAVOS (P1,532,610.75) representing the
Philippines and defendant Agripina Caperal, jointly amounts paid by defendant Agripina Caperal to
and severally, to restore to plaintiff the latter's defendant Development Bank of the Philippines
leasehold rights and interests and right of possession under their Deed of Conditional Sale.
over the fishpond land in question, without prejudice
to the right of defendant Development Bank of the CUBA and DBP interposed separate appeals from the decision to the
Philippines to foreclose the securities given by Court of Appeals. The former sought an increase in the amount of
plaintiff; damages, while the latter questioned the findings of fact and law of
the lower court.
5. ORDERING defendant Development Bank of the
Philippines to pay to plaintiff the following amounts: In its decision5 of 25 May 1994, the Court of Appeals ruled that (1)
the trial court erred in declaring that the deed of assignment was null
a) The sum of ONE MILLION and void and that defendant Caperal could not validly acquire the
SIXTY-SEVEN THOUSAND FIVE leasehold rights from DBP; (2) contrary to the claim of DBP, the
HUNDRED PESOS assignment was not a cession under Article 1255 of the Civil Code
(P1,067,500.00), as and for actual because DBP appeared to be the sole creditor to CUBA — cession
damages; presupposes plurality of debts and creditors; (3) the deeds of
assignment represented the voluntary act of CUBA in assigning her
b) The sum of ONE HUNDRED property rights in payment of her debts, which amounted to a novation
THOUSAND (P100,000.00) PESOS of the promissory notes executed by CUBA in favor of DBP; (4)
as moral damages; CUBA was estopped from questioning the assignment of the leasehold
rights, since she agreed to repurchase the said rights under a deed of
c) The sum of FIFTY THOUSAND conditional sale; and (5) condition no. 12 of the deed of assignment
(P50,000.00) PESOS, as and for was an express authority from CUBA for DBP to sell whatever right
exemplary damages; she had over the fishpond. It also ruled that CUBA was not entitled to
loss of profits for lack of evidence, but agreed with the trial court as
to the actual damages of P1,067,500. It, however, deleted the amount
d) And the sum of ONE HUNDRED
THOUSAND (P100,000.00) of exemplary damages and reduced the award of moral damages from
PESOS, as and for attorney's fees; P100,000 to P50,000 and attorney's fees, from P100,000 to P50,000.
The Court of Appeals thus declared as valid the following: (1) the act foreclosure of the mortgage securing this notes, I/We further bind
of DBP in appropriating Cuba's leasehold rights and interest under myself/ourselves, jointly and severally, to pay the deficiency, if any."7
Fishpond Lease Agreement No. 2083; (2) the deeds of assignment
executed by Cuba in favor of DBP; (3) the deed of conditional sale Simultaneous with the execution of the notes was the execution of
between CUBA and DBP; and (4) the deed of conditional sale between "Assignments of Leasehold Rights"8 where CUBA assigned her
DBP and Caperal, the Fishpond Lease Agreement in favor of Caperal, leasehold rights and interest on a 44-hectare fishpond, together with
and the assignment of leasehold rights executed by Caperal in favor of the improvements thereon. As pointed out by CUBA, the deeds of
DBP. It then ordered DBP to turn over possession of the property to assignment constantly referred to the assignor (CUBA) as "borrower";
Caperal as lawful holder of the leasehold rights and to pay CUBA the the assigned rights, as mortgaged properties; and the instrument itself,
following amounts: (a) P1,067,500 as actual damages; P50,000 as as mortgage contract. Moreover, under condition no. 22 of the deed, it
moral damages; and P50,000 as attorney's fees. was provided that "failure to comply with the terms and condition of
any of the loans shall cause all other loans to become due and
Since their motions for reconsideration were denied, 6 DBP and CUBA demandable and all mortgages shall be foreclosed." And, condition
filed separate petitions for review. no. 33 provided that if "foreclosure is actually accomplished, the usual
10% attorney's fees and 10% liquidated damages of the total
In its petition (G.R. No. 118342), DBP assails the award of actual and obligation shall be imposed." There is, therefore, no shred of doubt
moral damages and attorney's fees in favor of CUBA. that a mortgage was intended.

Upon the other hand, in her petition (G.R. No. 118367), CUBA Besides, in their stipulation of facts the parties admitted that the
contends that the Court of Appeals erred (1) in not holding that the assignment was by way of security for the payment of the loans; thus:
questioned deed of assignment was a pactum commissorium contrary
to Article 2088 of the Civil Code; (b) in holding that the deed of 3. As security for said loans, plaintiff Lydia P. Cuba
assignment effected a novation of the promissory notes; (c) in holding executed two Deeds of Assignment of her Leasehold
that CUBA was estopped from questioning the validity of the deed of Rights.
assignment when she agreed to repurchase her leasehold rights under
a deed of conditional sale; and (d) in reducing the amounts of moral In People's Bank & Trust Co. vs. Odom,9 this Court had the occasion
damages and attorney's fees, in deleting the award of exemplary to rule that an assignment to guarantee an obligation is in effect a
damages, and in not increasing the amount of damages. mortgage.

We agree with CUBA that the assignment of leasehold rights was a We find no merit in DBP's contention that the assignment novated the
mortgage contract. promissory notes in that the obligation to pay a sum of money the
loans (under the promissory notes) was substituted by the assignment
It is undisputed that CUBA obtained from DBP three separate loans of the rights over the fishpond (under the deed of assignment). As
totalling P335,000, each of which was covered by a promissory note. correctly pointed out by CUBA, the said assignment merely
In all of these notes, there was a provision that: "In the event of complemented or supplemented the notes; both could stand together.
The former was only an accessory to the latter. Contrary to DBP's
submission, the obligation to pay a sum of money remained, and the sell or otherwise dispose of whatever rights the
assignment merely served as security for the loans covered by the Assignor has or might have over said property and/or
promissory notes. Significantly, both the deeds of assignment and the its improvements and perform any other act which the
promissory notes were executed on the same dates the loans were Assignee may deem convenient to protect its interest.
granted. Also, the last paragraph of the assignment stated: "The All expenses advanced by the Assignee in connection
assignor further reiterates and states all terms, covenants, and with purpose above indicated which shall bear the
conditions stipulated in the promissory note or notes covering the same rate of interest aforementioned are also
proceeds of this loan, making said promissory note or notes, to all guaranteed by this Assignment. Any amount received
intent and purposes, an integral part hereof." from rents, administration, sale or disposal of said
property may be supplied by the Assignee to the
Neither did the assignment amount to payment by cession under payment of repairs, improvements, taxes,
Article 1255 of the Civil Code for the plain and simple reason that assessments and other incidental expenses and
there was only one creditor, the DBP. Article 1255 contemplates the obligations and the balance, if any, to the payment of
existence of two or more creditors and involves the assignment of all interest and then on the capital of the indebtedness
the debtor's property. secured hereby. If after disposal or sale of said
property and upon application of total amounts
Nor did the assignment constitute dation in payment under Article received there shall remain a deficiency, said
1245 of the civil Code, which reads: "Dation in payment, whereby Assignor hereby binds himself to pay the same to the
property is alienated to the creditor in satisfaction of a debt in money, Assignee upon demand, together with all interest
shall be governed by the law on sales." It bears stressing that the thereon until fully paid. The power herein granted
assignment, being in its essence a mortgage, was but a security and shall not be revoked as long as the Assignor is
not a satisfaction of indebtedness.10 indebted to the Assignee and all acts that may be
executed by the Assignee by virtue of said power are
We do not, however, buy CUBA's argument that condition no. 12 of hereby ratified.
the deed of assignment constituted pactum commissorium. Said
condition reads: The elements of pactum commissorium are as follows: (1) there should
be a property mortgaged by way of security for the payment of the
12. That effective upon the breach of any condition of principal obligation, and (2) there should be a stipulation for automatic
this assignment, the Assignor hereby appoints the appropriation by the creditor of the thing mortgaged in case of non-
Assignee his Attorney-in-fact with full power and payment of the principal obligation within the stipulated period. 11
authority to take actual possession of the property
above-described, together with all improvements Condition no. 12 did not provide that the ownership over the leasehold
thereon, subject to the approval of the Secretary of rights would automatically pass to DBP upon CUBA's failure to pay
Agriculture and Natural Resources, to lease the same the loan on time. It merely provided for the appointment of DBP as
or any portion thereof and collect rentals, to make attorney-in-fact with authority, among other things, to sell or
repairs or improvements thereon and pay the same, to otherwise dispose of the said real rights, in case of default by CUBA,
and to apply the proceeds to the payment of the loan. This provision guarantee an obligation, as in the present case, is virtually a mortgage
is a standard condition in mortgage contracts and is in conformity with and not an absolute conveyance of title which confers ownership on
Article 2087 of the Civil Code, which authorizes the mortgagee to the assignee. 12
foreclose the mortgage and alienate the mortgaged property for the
payment of the principal obligation. At any rate, DBP's act of appropriating CUBA's leasehold rights was
violative of Article 2088 of the Civil Code, which forbids a credit or
DBP, however, exceeded the authority vested by condition no. 12 of from appropriating, or disposing of, the thing given as security for the
the deed of assignment. As admitted by it during the pre-trial, it had payment of a debt.
"[w]ithout foreclosure proceedings, whether judicial or extrajudicial,
. . . appropriated the [l]easehold [r]ights of plaintiff Lydia Cuba over The fact that CUBA offered and agreed to repurchase her leasehold
the fishpond in question." Its contention that it limited itself to mere rights from DBP did not estop her from questioning DBP's act of
administration by posting caretakers is further belied by the deed of appropriation. Estoppel is unavailing in this case. As held by this
conditional sale it executed in favor of CUBA. The deed stated: Court in some cases,13 estoppel cannot give validity to an act that is
prohibited by law or against public policy. Hence, the appropriation
WHEREAS, the Vendor [DBP] by virtue of a deed of of the leasehold rights, being contrary to Article 2088 of the Civil
assignment executed in its favor by the herein Code and to public policy, cannot be deemed validated by estoppel.
vendees [Cuba spouses] the former acquired all the
right and interest of the latter over the above- Instead of taking ownership of the questioned real rights upon default
described property; by CUBA, DBP should have foreclosed the mortgage, as has been
stipulated in condition no. 22 of the deed of assignment. But, as
xxx xxx xxx admitted by DBP, there was no such foreclosure. Yet, in its letter dated
26 October 1979, addressed to the Minister of Agriculture and Natural
The title to the real estate property [sic] and all Resources and coursed through the Director of the Bureau of Fisheries
improvements thereon shall remain in the name of the and Aquatic Resources, DBP declared that it "had foreclosed the
Vendor until after the purchase price, advances and mortgage and enforced the assignment of leasehold rights on March
interest shall have been fully paid. (Emphasis 21, 1979 for failure of said spouses [Cuba spouces] to pay their loan
supplied). amortizations."14 This only goes to show that DBP was aware of the
necessity of foreclosure proceedings.
It is obvious from the above-quoted paragraphs that DBP had
appropriated and taken ownership of CUBA's leasehold rights merely In view of the false representation of DBP that it had already
on the strength of the deed of assignment. foreclosed the mortgage, the Bureau of Fisheries cancelled CUBA's
original lease permit, approved the deed of conditional sale, and issued
DBP cannot take refuge in condition no. 12 of the deed of assignment a new permit in favor of CUBA. Said acts which were predicated on
to justify its act of appropriating the leasehold rights. As stated earlier, such false representation, as well as the subsequent acts emanating
condition no. 12 did not provide that CUBA's default would operate from DBP's appropriation of the leasehold rights, should therefore be
to vest in DBP ownership of the said rights. Besides, an assignment to
set aside. To validate these acts would open the floodgates to could afford a basis for measuring whatever compensatory or actual
circumvention of Article 2088 of the Civil Code. damages are borne. 18

Even in cases where foreclosure proceedings were had, this Court had In the present case, the trial court awarded in favor of CUBA
not hesitated to nullify the consequent auction sale for failure to P1,067,500 as actual damages consisting of P550,000 which
comply with the requirements laid down by law, such as Act No. 3135, represented the value of the alleged lost articles of CUBA and
as amended.15 With more reason that the sale of property given as P517,500 which represented the value of the 230,000 pieces of bangus
security for the payment of a debt be set aside if there was no prior allegedly stocked in 1979 when DBP first ejected CUBA from the
fore closure proceeding. fishpond and the adjoining house. This award was affirmed by the
Court of Appeals.
Hence, DBP should render an accounting of the income derived from
the operation of the fishpond in question and apply the said income in We find that the alleged loss of personal belongings and equipment
accordance with condition no. 12 of the deed of assignment which was not proved by clear evidence. Other than the testimony of CUBA
provided: "Any amount received from rents, administration, . . . may and her caretaker, there was no proof as to the existence of those items
be applied to the payment of repairs, improvements, taxes, assessment, before DBP took over the fishpond in question. As pointed out by
and other incidental expenses and obligations and the balance, if any, DBP, there was not "inventory of the alleged lost items before the loss
to the payment of interest and then on the capital of the indebtedness. which is normal in a project which sometimes, if not most often, is left
. ." to the care of other persons." Neither was a single receipt or record of
acquisition presented.
We shall now take up the issue of damages.
Curiously, in her complaint dated 17 May 1985, CUBA included
Article 2199 provides: "losses of property" as among the damages resulting from DBP's take-
over of the fishpond. Yet, it was only in September 1985 when her son
Except as provided by law or by stipulation, one is and a caretaker went to the fishpond and the adjoining house that she
entitled to an adequate compensation only for such came to know of the alleged loss of several articles. Such claim for
pecuniary loss suffered by him as he has duly proved. "losses of property," having been made before knowledge of the
Such compensation is referred to as actual or alleged actual loss, was therefore speculative. The alleged loss could
compensatory damages. have been a mere afterthought or subterfuge to justify her claim for
actual damages.
Actual or compensatory damages cannot be presumed, but must be
proved with reasonable degree of certainty. 16 A court cannot rely on With regard to the award of P517,000 representing the value of the
speculations, conjectures, or guesswork as to the fact and amount of alleged 230,000 pieces of bangus which died when DBP took
damages, but must depend upon competent proof that they have been possession of the fishpond in March 1979, the same was not called for.
suffered by the injured party and on the best obtainable evidence of Such loss was not duly proved; besides, the claim therefor was delayed
the actual amount thereof.17 It must point out specific facts which unreasonably. From 1979 until after the filing of her complaint in court
in May 1985, CUBA did not bring to the attention of DBP the alleged Branch 54, in Civil Case No. A-1574 is MODIFIED setting aside the
loss. In fact, in her letter dated 24 October 1979, 19 she declared: finding that condition no. 12 of the deed of assignment
constituted pactum commissorium and the award of actual damages;
1. That from February to May 1978, I was then and by reducing the amounts of moral damages from P100,000 to
seriously ill in Manila and within the same period I P50,000; the exemplary damages, from P50,000 to P25,000; and the
neglected the management and supervision of the attorney's fees, from P100,000 to P20,000. The Development Bank of
cultivation and harvest of the produce of the aforesaid the Philippines is hereby ordered to render an accounting of the
fishpond thereby resulting to the irreparable loss in income derived from the operation of the fishpond in question.
the produce of the same in the amount of about
P500,000.00 to my great damage and prejudice due to Let this case be REMANDED to the trial court for the reception of the
fraudulent acts of some of my fishpond workers. income statement of DBP, as well as the statement of the account of
Lydia P. Cuba, and for the determination of each party's financial
Nowhere in the said letter, which was written seven months after DBP obligation to one another.
took possession of the fishpond, did CUBA intimate that upon DBP's
take-over there was a total of 230,000 pieces of bangus, but all of SO ORDERED.
which died because of DBP's representatives prevented her men from
feeding the fish.

The award of actual damages should, therefore, be struck down for

lack of sufficient basis.

In view, however, of DBP's act of appropriating CUBA's leasehold

rights which was contrary to law and public policy, as well as its false
representation to the then Ministry of Agriculture and Natural
Resources that it had "foreclosed the mortgage," an award of moral
damages in the amount of P50,000 is in order conformably with
Article 2219(10), in relation to Article 21, of the Civil Code.
Exemplary or corrective damages in the amount of P25,000 should
likewise be awarded by way of example or correction for the public
good.20 There being an award of exemplary damages, attorney's fees
are also recoverable.21

WHEREFORE, the 25 May 1994 Decision of the Court of Appeals in

CA-G.R. CV No. 26535 is hereby REVERSED, except as to the award
of P50,000 as moral damages, which is hereby sustained. The 31
January 1990 Decision of the Regional Trial Court of Pangasinan,
G.R. No. 107518 October 8, 1998 respondent sued the LSC and the Petroparcel captain, Edgardo
Doruelo, before the then Court of First Instance of Caloocan City,
PNOC SHIPPING AND TRANSPORT paying thereto the docket fee of one thousand two hundred fifty-two
CORPORATION, petitioner, pesos (P1,252.00) and the legal research fee of two pesos (P2.00). 8 In
vs. particular, private respondent prayed for an award of P692,680.00,
HONORABLE COURT OF APPEALS and MARIA EFIGENIA allegedly representing the value of the fishing nets, boat equipment
FISHING CORPORATION, respondents. and cargoes of M/V Maria Efigenia XV, with interest at the legal rate
plus 25% thereof as attorney's fees. Meanwhile, during the pendency
of the case, petitioner PNOC Shipping and Transport Corporation
sought to be substituted in place of LSC as it had already acquired
ROMERO, J.: ownership of the Petroparcel. 9

A party is entitled to adequate compensation only for such pecuniary For its part, private respondent later sought the amendment of its
loss actually suffered and duly proved. 1 Indeed, basic is the rule that complaint on the ground that the original complaint failed to plead for
to recover actual damages, the amount of loss must not only be capable the recovery of the lost value of the hull of M/V Maria Efigenia
of proof but must actually be proven with a reasonable degree of XV. 10 Accordingly, in the amended complaint, private respondent
certainty, premised upon competent proof or best evidence obtainable averred that M/V Maria Efigenia XV had an actual value of
of the actual amount thereof.2 The claimant is duty-bound to point out P800,000.00 and that, after deducting the insurance payment of
specific facts that afford a basis for measuring whatever compensatory P200,000.00, the amount of P600,000.00 should likewise be claimed.
damages are borne.3 A court cannot merely rely on speculations, The amended complaint also alleged that inflation resulting from the
conjectures, or guesswork as to the fact and amount of damages 4 as devaluation of the Philippine peso had affected the replacement value
well as hearsay5 or uncorroborated testimony whose truth is of the hull of the vessel, its equipment and its lost cargoes, such that
suspect.6 Such are the jurisprudential precepts that the Court now there should be a reasonable determination thereof. Furthermore, on
applies in resolving the instant petition. account of the sinking of the vessel, private respondent supposedly
incurred unrealized profits and lost business opportunities that would
The records disclose that in the early morning of September 21, 1977, thereafter be proven. 11
the M/V Maria Efigenia XV, owned by private respondent Maria
Efigenia Fishing Corporation, was navigating the waters near Fortune Subsequently, the complaint was further amended to include petitioner
Island in Nasugbu, Batangas on its way to Navotas, Metro Manila as a defendant 12 which the lower court granted in its order of
when it collided with the vessel Petroparcel which at the time was September 16,
13
owned by the Luzon Stevedoring Corporation (LSC). 1985. After petitioner had filed its answer to the second amended
complaint, on February 5, 1987, the lower court issued a pre-trial
After investigation was conducted by the Board of Marine Inquiry, order 14 containing, among other things, a stipulations of facts, to wit:
Philippine Coast Guard Commandant Simeon N. Alejandro rendered
a decision finding the Petroparcel at fault. Based on this finding by 1. On 21 September 1977, while the fishing boat
the Board and after unsuccessful demands on petitioner, 7 private "M/V MARIA EFIGENIA" owned by plaintiff was
navigating in the vicinity of Fortune Island in executed wherein Board of Marine Inquiry Case No.
Nasugbu, Batangas, on its way to Navotas, Metro 332 (involving the sea accident of 21 September
Manila, said fishing boat was hit by the LSCO tanker 1977) was specifically identified and assumed by the
"Petroparcel" causing the former to sink. latter.

2. The Board of Marine Inquiry conducted an 7. On 23 June 1979, the decision of Board of Marine
investigation of this marine accident and on 21 Inquiry was affirmed by the Ministry of National
November 1978, the Commandant of the Philippine Defense, in its decision dismissing the appeal of Capt.
Coast Guard, the Honorable Simeon N. Alejandro, Edgardo Doruelo and Chief mate Anthony Estenzo of
rendered a decision finding the cause of the accident LSCO "Petroparcel".
to be the reckless and imprudent manner in which
Edgardo Doruelo navigated the LSCO "Petroparcel" 8. LSCO "Petroparcel" is presently owned and
and declared the latter vessel at fault. operated by PNOC-STC and likewise Capt. Edgardo
Doruelo is still in their employ.
3. On 2 April 1978, defendant Luzon Stevedoring
Corporation (LUSTEVECO), executed in favor of 9. As a result of the sinking of M/V Maria Efigenia
PNOC Shipping and Transport Corporation a Deed of caused by the reckless and imprudent manner in
Transfer involving several tankers, tugboats, barges which LSCO Petroparcel was navigated by defendant
and pumping stations, among which was the LSCO Doruelo, plaintiff suffered actual damages by the loss
Petroparcel. of its fishing nets, boat equipments (sic) and cargoes,
which went down with the ship when it sank the
4. On the same date on 2 April 1979 (sic), defendant replacement value of which should be left to the
PNOC STC again entered into an Agreement of sound discretion of this Honorable Court.
Transfer with co-defendant Lusteveco whereby all
the business properties and other assets appertaining After trial, the lower court 15 rendered on November 18, 1989 its
to the tanker and bulk oil departments including the decision disposing of Civil Case No. C-9457 as follows:
motor tanker LSCO Petroparcel of defendant
Lusteveco were sold to PNOC STC. WHEREFORE, and in view of the foregoing,
judgment is hereby rendered in favor of the plaintiff
5. The aforesaid agreement stipulates, among others, and against the defendant PNOC Shipping &
that PNOC-STC assumes, without qualifications, all Transport Corporation, to pay the plaintiff:
obligations arising from and by virtue of all rights it
obtained over the LSCO "Petroparcel". a. The sum of P6,438,048.00
representing the value of the fishing
6. On 6 July 1979, another agreement between boat with interest from the date of the
defendant LUSTEVECO and PNOC-STC was
 filing of the complaint at the rate of (a) Exhibit A — certified xerox copy
6% per annum; of the certificate of ownership
of M/V Maria Efigenia XV;
b. The sum of P50,000.00 as and for
attorney's fees; and (b) Exhibit B — a document titled
"Marine Protest" executed by Delfin
c. The costs of suit. Villarosa, Jr. on September 22, 1977
stating that as a result of the collision,
The counterclaim is hereby DISMISSED for lack of the M/V Maria Efigenia XV sustained
merit. Likewise, the case against defendant Edgardo a hole at its left side that caused it to
Doruelo is hereby DISMISSED, for lack of sink with its cargo of
jurisdiction. 1,050 bañeras valued at
P170,000.00;
SO ORDERED.
(c) Exhibit C — a quotation for the
In arriving at the above disposition, the lower court cited the evidence construction of a 95-footer trawler
presented by private respondent consisting of the testimony of its issued by Isidoro A. Magalong of I.
general manager and sole witness, Edilberto del Rosario. Private A. Magalong Engineering and
respondent's witness testified that M/V Maria Efigenia XV was owned Construction on January 26, 1987 to
by private respondent per Exhibit A, a certificate of ownership issued Del Rosario showing that
by the Philippine Coast Guard showing that M/V Maria Efigenia construction of such trawler would
XV was a wooden motor boat constructed in 1965 with 128.23 gross cost P2,250,000.00;
tonnage. According to him, at the time the vessel sank, it was then
carrying 1,060 tubs (bañeras) of assorted fish the value of which was (d) Exhibit D — pro forma invoice
never recovered. Also lost with the vessel were two cummins engines No. PSPI-05/87-NAV issued by E.D.
(250 horsepower), radar, pathometer and compass. He further added Daclan of Power Systems,
that with the loss of his flagship vessel in his fishing fleet of fourteen Incorporated on January 20, 1987 to
(14) vessels, he was constrained to hire the services of counsel whom Del Rosario showing that two (2)
he paid P10,000 to handle the case at the Board of Marine Inquiry and units of CUMMINS Marine Engine
P50,000.00 for commencing suit for damages in the lower court. model N855-M, 195 bhp. at 1800
rpm. would cost P1,160,000.00;
As to the award of P6,438,048.00 in actual damages, the lower court
took into account the following pieces of documentary evidence that (e) Exhibit E — quotation of prices
private respondent proffered during trial: issued by Scan Marine Inc. on
January 20, 1987 to Del Rosario
showing that a unit of Furuno
Compact Daylight Radar, Model FR- 100mtrs., P70,000.00; 50 rolls of
604D, would cost P100,000.00 while 400/18 5kts. 100md x 100mtrs.,
a unit of Furuno Color Video P81,500.00; 50 rolls of 400/18 8kts.
Sounder, Model FCV-501 would 100md x 100mtrs., P116,000.00, and
cost P45,000.00 so that the two units 50 rolls of 400/18 10kts. 100md x
would cost P145,000.00; 100mtrs., P146,500 and bañera (tub)
at P65.00 per piece or a total of
(f) Exhibit F — quotation of prices P414,065.00.
issued by Seafgear Sales, Inc. on
January 21, 1987 to Del Rosario The lower court held that the prevailing replacement value of
showing that two (2) rolls of nylon P6,438,048.00 of the fishing boat and all its equipment would
rope (5" cir. X 300fl.) would cost regularly increase at 30% every year from the date the quotations were
P140,000.00; two (2) rolls of nylon given.
rope (3" cir. X 240fl.), P42,750.00;
one (1) binocular (7 x 50), On the other hand, the lower court noted that petitioner only presented
P1,400.00, one (1) compass (6"), Lorenzo Lazaro, senior estimator at PNOC Dockyard & Engineering
P4,000.00 and 50 pcs. of floats, Corporation, as sole witness and it did not bother at all to offer any
P9,000.00 or a total of P197,150.00; documentary evidence to support its position. Lazaro testified that the
price quotations submitted by private respondent were "excessive" and
(g) Exhibit G — retainer agreement that as an expert witness, he used the quotations of his suppliers in
between Del Rosario and F. making his estimates. However, he failed to present such quotations
Sumulong Associates Law Offices of prices from his suppliers, saying that he could not produce a
stipulating an acceptance fee of breakdown of the costs of his estimates as it was "a sort of secret
P5,000.00, per appearance fee of scheme." For this reason, the lower court concluded:
P400.00, monthly retainer of
P500.00, contingent fee of 20% of Evidently, the quotation of prices submitted by the
the total amount recovered and that plaintiff relative to the replacement value of the
attorney's fee to be awarded by the fishing boat and its equipments in the tune of
court should be given to Del Rosario; P6,438,048.00 which were lost due to the
and recklessness and imprudence of the herein defendants
were not rebutted by the latter with sufficient
(h) Exhibit H — price quotation evidence. The defendants through their sole witness
issued by Seafgear Sales, Inc. dated Lorenzo Lazaro relied heavily on said witness' bare
April 10, 1987 to Del Rosario claim that the amount afore-said is excessive or
showing the cost of poly nettings as: bloated, but they did not bother at all to present any
50 rolls of 400/18 3kts. 100md x documentary evidence to substantiate such claim.
 Evidence to be believed must not only proceed from presented as in the nature of market reports or quotations, trade
the mouth of the credible witness, but it must be journals, trade circulars and price lists, the Court of Appeals held, thus:
credible in itself. (Vda. de Bonifacio vs. B. L. T. Bus
Co., Inc. L-26810, August 31, 1970). Consequently, until such time as the Supreme Court
categorically rules on the admissibility or
Aggrieved, petitioner filed a motion for the reconsideration of the inadmissibility of this class of evidence, the reception
lower court's decision contending that: (1) the lower court erred in of these documentary exhibits (price quotations) as
holding it liable for damages; that the lower court did not acquire evidence rests on the sound discretion of the trial
jurisdiction over the case by paying only P1,252.00 as docket fee; (2) court. In fact, where the lower court is confronted
assuming that plaintiff was entitled to damages, the lower court erred with evidence which appears to be of doubtful
in awarding an amount greater than that prayed for in the second admissibility, the judge should declare in favor of
amended complaint; and (3) the lower court erred when it failed to admissibility rather than of non-admissibility (The
resolve the issues it had raised in its memorandum. 16 Petitioner Collector of Palakadhari, 124 [1899], p. 13, cited in
likewise filed a supplemental motion for reconsideration expounding Francisco, Revised Rules of Court, Evidence,
on whether the lower court acquired jurisdiction over the subject Volume VII, Part I, 1990 Edition, p. 18). Trial courts
matter of the case despite therein plaintiff's failure to pay the are enjoined to observe the strict enforcement of the
prescribed docket fee. 17 rules of evidence which crystallized through constant
use and practice and are very useful and effective aids
On January 25, 1990, the lower court declined reconsideration for lack in the search for truth and for the effective
of merit. 18 Apparently not having received the order denying its administration of justice. But in connection with
motion for reconsideration, petitioner still filed a motion for leave to evidence which may appear to be of doubtful
file a reply to private respondent's opposition to said motion. 19 Hence, relevancy or incompetency or admissibility, it is the
on February 12, 1990, the lower court denied said motion for leave to safest policy to be liberal, not rejecting them on
file a reply on the ground that by the issuance of the order of January doubtful or technical grounds, but admitting them
25, 1990, said motion had become moot and academic. 20 unless plainly irrelevant, immaterial or incompetent,
for the reason that their rejection places them beyond
Unsatisfied with the lower court's decision, petitioner elevated the the consideration of the court. If they are thereafter
matter to the Court of Appeals which, however, affirmed the same in found relevant or competent, can easily be remedied
toto on October 14, 1992. 21 On petitioner's assertion that the award of by completely discarding or ignoring them. (Banaria
P6,438,048.00 was not convincingly proved by competent and vs. Banaria, et al., C.A. No. 4142, May 31,
admissible evidence, the Court of Appeals ruled that it was not 1950; cited in Francisco, Supra). [Emphasis
necessary to qualify Del Rosario as an expert witness because as the supplied].
owner of the lost vessel, "it was well within his knowledge and
competency to identify and determine the equipment installed and the Stressing that the alleged inadmissible documentary exhibits were
cargoes loaded" on the vessel. Considering the documentary evidence never satisfactorily rebutted by appellant's own sole witness in the
person of Lorenzo Lazaro, the appellate court found that petitioner
ironically situated itself in an "inconsistent posture by the fact that its and actual value of damages sustained as a result of the 1977 collision
own witness, admittedly an expert one, heavily relies on the very same of the vessels. 23
pieces of evidence (price quotations) appellant has so vigorously
objected to as inadmissible evidence." Hence, it concluded: Under Article 2199 of the Civil Code, actual or compensatory
damages are those awarded in satisfaction of, or in recompense for,
. . . The amount of P6,438,048.00 was duly loss or injury sustained. They proceed from a sense of natural justice
established at the trial on the basis of appellee's and are designed to repair the wrong that has been done, to compensate
documentary exhibits (price quotations) which stood for the injury inflicted and not to impose a penalty. 24 In actions based
uncontroverted, and which already included the on torts or quasi-delicts, actual damages include all the natural and
amount by way of adjustment as prayed for in the probable consequences of the act or omission complained of. 25 There
amended complaint. There was therefore no need for are two kinds of actual or compensatory damages: one is the loss of
appellee to amend the second amended complaint in what a person already possesses (daño emergente), and the other is the
so far as to the claim for damages is concerned to failure to receive as a benefit that which would have pertained to him
conform with the evidence presented at the trial. The (lucro cesante). 26 Thus:
amount of P6,438,048.00 awarded is clearly within
the relief prayed for in appellee's second amended Where goods are destroyed by the wrongful act of the
complaint. defendant the plaintiff is entitled to their value at the
time of destruction, that is, normally, the sum of
On the issue of lack of jurisdiction, the respondent court held that money which he would have to pay in the market for
following the ruling in Sun Insurance Ltd. v. Asuncion, 22 the identical or essentially similar goods, plus in a proper
additional docket fee that may later on be declared as still owing the case damages for the loss of use during the period
court may be enforced as a lien on the judgment. before replacement. In other words, in the case of
profit-earning chattels, what has to be assessed is the
Hence, the instant recourse. value of the chattel to its owner as a going concern at
the time and place of the loss, and this means, at least
In assailing the Court of Appeals' decision, petitioner posits the view in the case of ships, that regard must be had to existing
that the award of P6,438,048 as actual damages should have been in and pending engagements, . . .
light of these considerations, namely: (1) the trial court did not base
such award on the actual value of the vessel and its equipment at the . . . . If the market value of the ship reflects the fact
time of loss in 1977; (2) there was no evidence on extraordinary that it is in any case virtually certain of profitable
inflation that would warrant an adjustment of the replacement cost of employment, then nothing can be added to that value
the lost vessel, equipment and cargo; (3) the value of the lost cargo in respect of charters actually lost, for to do so would
and the prices quoted in respondent's documentary evidence only be pro tanto to compensate the plaintiff twice over.
amount to P4,336,215.00; (4) private respondent's failure to adduce On the other hand, if the ship is valued without
evidence to support its claim for unrealized profit and business reference to its actual future engagements and only in
opportunities; and (5) private respondent's failure to prove the extent the light of its profit-earning potentiality, then it may
 be necessary to add to the value thus assessed the objections to the exhibits, the lower court admitted these pieces of
anticipated profit on a charter or other engagement evidence and gave them due weight to arrive at the award of
which it was unable to fulfill. What the court has to P6,438,048.00 as actual damages.
ascertain in each case is the "capitalised value of the
vessel as a profit-earning machine not in the abstract The exhibits were presented ostensibly in the course of Del Rosario's
but in view of the actual circumstances," without, of testimony. Private respondent did not present any other witnesses
course, taking into account considerations which especially those whose signatures appear in the price quotations that
were too remote at the time of the loss. 27 [Emphasis became the bases of the award. We hold, however, that the price
supplied]. quotations are ordinary private writings which under the Revised
Rules of Court should have been proffered along with the testimony
As stated at the outset, to enable an injured party to recover actual or of the authors thereof. Del Rosario could not have testified on the
compensatory damages, he is required to prove the actual amount of veracity of the contents of the writings even though he was the
loss with reasonable degree of certainty premised upon competent seasoned owner of a fishing fleet because he was not the one who
proof and on the best evidence available. 28 The burden of proof is on issued the price quotations. Section 36, Rule 130 of the Revised Rules
the party who would be defeated if no evidence would be presented of Court provides that a witness can testify only to those facts that he
on either side. He must establish his case by a preponderance of knows of his personal knowledge.
evidence which means that the evidence, as a whole, adduced by one
side is superior to that of the other. 29 In other words, damages cannot For this reason, Del Rosario's claim that private respondent incurred
be presumed and courts, in making an award must point out specific losses in the total amount of P6,438,048.00 should be admitted with
facts that could afford a basis for measuring whatever compensatory extreme caution considering that, because it was a bare assertion, it
or actual damages are borne. 30 should be supported by independent evidence. Moreover, because he
was the owner of private respondent corporation 32 whatever testimony
In this case, actual damages were proven through the sole testimony he would give with regard to the value of the lost vessel, its equipment
of private respondent's general manager and certain pieces of and cargoes should be viewed in the light of his self-interest therein.
documentary evidence. Except for Exhibit B where the value of the We agree with the Court of Appeals that his testimony as to the
1,050 bañeras of fish were pegged at their September 1977 value equipment installed and the cargoes loaded on the vessel should be
when the collision happened, the pieces of documentary evidence given credence 33 considering his familiarity thereto. However, we do
proffered by private respondent with respect to items and equipment not subscribe to the conclusion that his valuation of such equipment,
lost show similar items and equipment with corresponding prices in cargo and the vessel itself should be accepted as gospel truth. 34 We
early 1987 or approximately ten (10) years after the collision. must, therefore, examine the documentary evidence presented to
Noticeably, petitioner did not object to the exhibits in terms of the time support Del Rosario's claim as regards the amount of losses.
index for valuation of the lost goods and equipment. In objecting to
the same pieces of evidence, petitioner commented that these were not The price quotations presented as exhibits partake of the nature of
duly authenticated and that the witness (Del Rosario) did not have hearsay evidence considering that the persons who issued them were
personal knowledge on the contents of the writings and neither was he not presented as witnesses. 35 Any evidence, whether oral or
an expert on the subjects thereof. 31 Clearly ignoring petitioner's documentary, is hearsay if its probative value is not based on the
personal knowledge of the witness but on the knowledge of another Based on the above requisites, it is our considered view that Exhibits
person who is not on the witness stand. Hearsay evidence, whether B, C, D, E, F and H 39 are not "commercial lists" for these do not
objected to or not, has no probative value unless the proponent can belong to the category of "other published compilations" under
show that the evidence falls within the exceptions to the hearsay Section 45 aforequoted. Under the principle of ejusdem generis,
evidence rule. 36 On this point, we believe that the exhibits do not fall "(w)here general words follow an enumeration of persons or things,
under any of the exceptions provided under Sections 37 to 47 of Rule by words of a particular and specific meaning, such general words are
130. 37 not to be construed in their widest extent, but are to be held as applying
only to persons or things of the same kind or class as those specifically
It is true that one of the exceptions to the hearsay rule pertains to mentioned." 40 The exhibits mentioned are mere price quotations
"commercial lists and the like" under Section 45, Rule 130 of the issued personally to Del Rosario who requested for them from dealers
Revised Rules on Evidence. In this respect, the Court of Appeals of equipment similar to the ones lost at the collision of the two vessels.
considered private respondent's exhibits as "commercial lists." It These are not published in any list, register, periodical or other
added, however, that these exhibits should be admitted in evidence compilation on the relevant subject matter. Neither are these "market
"until such time as the Supreme Court categorically rules on the reports or quotations" within the purview of "commercial lists" as
admissibility or inadmissibility of this class of evidence" because "the these are not "standard handbooks or periodicals, containing data of
reception of these documentary exhibits (price quotations) as evidence everyday professional need and relied upon in the work of the
rests on the sound discretion of the trial court." 38 Reference to Section occupation." 41 These are simply letters responding to the queries of
45, Rule 130, however, would show that the conclusion of the Court Del Rosario. Thus, take for example Exhibit D which reads:
of Appeals on the matter was arbitrarily arrived at. This rule states:
January 20, 1987
Commercial lists and the like. — Evidence of
statements of matters of interest to persons engaged PROFORMA INVOICE NO. PSPI-05/87-NAV
in an occupation contained in a list, register,
periodical, or other published compilation is MARIA EFIGINIA FISHING CORPORATION
admissible as tending to prove the truth of any
relevant matter so stated if that compilation is Navotas, Metro Manila
published for use by persons engaged in that
occupation and is generally used and relied upon by Attention: MR. EDDIE DEL ROSARIO
them there.
Gentlemen:
Under Section 45 of the aforesaid Rule, a document is a commercial
list if: (1) it is a statement of matters of interest to persons engaged in In accordance to your request, we are pleated to quote
an occupation; (2) such statement is contained in a list, register,
our Cummins Marine Engine, to wit.
periodical or other published compilation; (3) said compilation is
published for the use of persons engaged in that occupation, and (4) it
Two (2) units
is generally used and relied upon by persons in the same occupation.
CUMMINS Marine
 Engine model WARRANTY : One (1) full year
N855-M, 195 bhp. against factory defect.
at 1800 rpm., 6-
cylinder in-line, 4-
stroke cycle, natural
aspirated, 5 1/2 in. x
6 in. bore and
stroke, 855 cu. In.
displacement, keel-
cooled, electric
starting coupled
with Twin-Disc
Marine gearbox
model MG-509,
4.5:1 reduction
ratio, includes oil
cooler, companion
flange, manual and
standard accessories
as per attached
sheet.

Price FOB Manila

P580,000.00/unit

Total FOB Manila

P1,160,000.00

TERMS : CASH

DELIVERY : 60-90 days from date

of order.

VALIDITY : Subject to our final

confirmation.
 Admissibility of evidence refers
( to the question of whether or not the
circumstance (or evidence) isSto considered at all. 45 On the other hand,
the probative value of evidenceg refers to the question of whether or
not it proves an issue. 46 Thus,
d a letter may be offered in evidence and
admitted as such but its .evidentiary weight depends upon the
observance of the rules on evidence.
) Accordingly, the author of the
letter should be presented as witness to provide the other party to the
litigation the opportunity to question
E him on the contents of the letter.
Being mere hearsay evidence,. failure to present the author of the letter
renders its contents suspect. D As earlier stated, hearsay evidence,
whether objected to or not, has. no probative value. Thus:
D
The courts adiffer as to the weight to be given to
hearsay evidence
c admitted without objection. Some
hold that whenl hearsay has been admitted without
objection, thea same may be considered as any other
properly admitted
n testimony. Others maintain that it
is entitled to no more consideration than if it had been
To be sure, letters and telegrams are admissible in evidence but these excluded.
are, however, subject to the general principles of evidence and to
various rules relating to documentary evidence. 42 Hence, in one case, The rule prevailing in this jurisdiction is the latter one.
it was held that a letter from an automobile dealer offering an Our Supreme Court held that although the question of
allowance for an automobile upon purchase of a new automobile after admissibility of evidence can not be raised for the first
repairs had been completed, was not a "price current" or "commercial time on appeal, yet if the evidence is hearsay it has no
list" within the statute which made such items presumptive evidence probative value and should be disregarded whether
of the value of the article specified therein. The letter was not objected to or not. "If no objection is made" —
admissible in evidence as a "commercial list" even though the clerk of quoting Jones on Evidence — "it (hearsay) becomes
the dealer testified that he had written the letter in due course of evidence by reason of the want of such objection even
business upon instructions of the dealer. 43 though its admission does not confer upon it any new
attribute in point of weight. Its nature and quality
But even on the theory that the Court of Appeals correctly ruled on the remain the same, so far as its intrinsic weakness and
admissibility of those letters or communications when it held that incompetency to satisfy the mind are concerned, and
unless "plainly irrelevant, immaterial or incompetent," evidence as opposed to direct primary evidence, the latter
should better be admitted rather than rejected on "doubtful or technical always prevails.
grounds," 44 the same pieces of evidence, however, should not have
been given probative weight. This is a distinction we wish to point out.
 The failure of the defense counsel to object to the Actually, nominal damages are damages in name only and not in fact.
presentation of incompetent evidence, like hearsay Where these are allowed, they are not treated as an equivalent of a
evidence or evidence that violates the rules of res wrong inflicted but simply in recognition of the existence of a
inter alios acta, or his failure to ask for the striking technical injury. 51 However, the amount to be awarded as nominal
out of the same does not give such evidence any damages shall be equal or at least commensurate to the injury
probative value. But admissibility of evidence should sustained by private respondent considering the concept and purpose
not be equated with weight of evidence. Hearsay of such damages. 52 The amount of nominal damages to be awarded
evidence whether objected to or not has no probative may also depend on certain special reasons extant in the case. 53
value. 47
Applying now such principles to the instant case, we have on record
Accordingly, as stated at the outset, damages may not be awarded on the fact that petitioner's vessel Petroparcel was at fault as well as
the basis of hearsay evidence. 48 private respondent's complaint claiming the amount of P692,680.00
representing the fishing nets, boat equipment and cargoes that sunk
Nonetheless, the non-admissibility of said exhibits does not mean that with the M/V Maria Efigenia XV. In its amended complaint, private
it totally deprives private respondent of any redress for the loss of its respondent alleged that the vessel had an actual value of P800,000.00
vessel. This is because in Lufthansa German Airlines v. Court of but it had been paid insurance in the amount of P200,000.00 and,
Appeals, 49 the Court said: therefore, it claimed only the amount of P600,000.00. Ordinarily, the
receipt of insurance payments should diminish the total value of the
In the absence of competent proof on the actual vessel quoted by private respondent in his complaint considering that
damage suffered, private respondent is "entitled to such payment is causally related to the loss for which it claimed
nominal damages which, as the law says, is compensation. This Court believes that such allegations in the original
adjudicated in order that a right of the plaintiff, which and amended complaints can be the basis for determination of a fair
has been violated or invaded by defendant, may be amount of nominal damages inasmuch as a complaint alleges the
vindicated and recognized, and not for the purpose of ultimate facts constituting the plaintiffs cause of
indemnifying the plaintiff for any loss suffered." action. 54 Private respondent should be bound by its allegations on the
[Emphasis supplied]. amount of its claims.

Nominal damages are awarded in every obligation arising from law, With respect to petitioner's contention that the lower court did not
contracts, quasi-contracts, acts or omissions punished by law, and acquire jurisdiction over the amended complaint increasing the
quasi-delicts, or in every case where property right has been amount of damages claimed to P600,000.00, we agree with the Court
invaded. 50 Under Article 2223 of the Civil Code, "(t)he adjudication of Appeals that the lower court acquired jurisdiction over the case
of nominal damages shall preclude further contest upon the right when private respondent paid the docket fee corresponding to its claim
involved and all accessory questions, as between the parties to the suit, in its original complaint. Its failure to pay the docket fee corresponding
or their respective heirs and assigns." to its increased claim for damages under the amended complaint
should not be considered as having curtailed the lower court's
jurisdiction. Pursuant to the ruling in Sun Insurance Office, Ltd.
(SIOL) v. Asuncion, 55 the unpaid docket fee should be considered as SO ORDERED.
a lien on the judgment even though private respondent specified the
amount of P600,000.00 as its claim for damages in its amended
complaint.

Moreover, we note that petitioner did not question at all the

jurisdiction of the lower court on the ground of insufficient docket fees
in its answers to both the amended complaint and the second amended
complaint. It did so only in its motion for reconsideration of the
decision of the lower court after it had received an adverse decision.
As this Court held in Pantranco North Express, Inc. v. Court of
Appeals, 56 participation in all stages of the case before the trial court,
that included invoking its authority in asking for affirmative relief,
effectively barred petitioner by estoppel from challenging the court's
jurisdiction. Notably, from the time it filed its answer to the second
amended complaint on April 16, 1985, 57 petitioner did not question
the lower court's jurisdiction. It was only on December 29,
1989 58 when it filed its motion for reconsideration of the lower court's
decision that petitioner raised the question of the lower court's lack of
jurisdiction. Petitioner thus foreclosed its right to raise the issue of
jurisdiction by its own inaction.

WHEREFORE, the challenged decision of the Court of Appeals dated

October 14, 1992 in CA-G.R. CV No. 26680 affirming that of the
Regional Trial Court of Caloocan City, Branch 121, is hereby
MODIFIED insofar as it awarded actual damages to private
respondent Maria Efigenia Fishing Corporation in the amount of
P6,438,048.00 for lack of evidentiary bases therefor. Considering the
fact, however, that: (1) technically petitioner sustained injury but
which, unfortunately, was not adequately and properly proved, and (2)
this case has dragged on for almost two decades, we believe that an
award of Two Million (P2,000,000.00) 59 in favor of private
respondent as and for nominal damages is in order.

No pronouncement as to costs.
G.R. No. 79578 March 13, 1991 Mrs. Hilario Midoranda, at Trinidad, Calbayog City, through
petitioner Radio Communications of the Philippines, Inc. (RCPI,
RADIO COMMUNICATIONS OF THE PHILIPPINES, INC. hereinafter) at Cubao, Quezon City, to convey their deepest sympathy
(RCPI), petitioner, for the recent death of the mother-in-law of Hilario Midoranda4 to wit:
vs.
HON. COURT OF APPEALS, and SPOUSES MINERVA MR. & MRS. HILARIO MIDORANDA
TIMAN and FLORES TIMAN, respondents. TRINIDAD, CALBAYOG CITY

Salalima, Trenas, Pagaoa & Associates for petitioner. MAY GOD GIVE YOU COURAGE AND STRENGTH TO BEAR
Paul P. Lentejas for private respondents. YOUR LOSS. OUR DEEPEST SYMPATHY TO YOU AND
MEMBERS OF THE FAMILY.
SARMIENTO, J.:
MINER & FLORY.5
A social condolence telegram sent through the facilities of the
petitioner gave rise to the present petition for review The condolence telegram was correctly transmitted as far as the
on certiorari assailing the decision1 of the respondent Court of written text was concerned. However, the condolence message as
Appeals which affirmed in toto the judgment2 of the trial court, dated communicated and delivered to the addressees was typewritten on a
February 14, 1985, the dispositive portion of which reads: "Happy Birthday" card and placed inside a "Christmasgram"
envelope. Believing that the transmittal to the addressees of the
WHEREFORE, premises considered, judgment is hereby rendered: aforesaid telegram in that nonsuch manner was done intentionally and
with gross breach of contract resulting to ridicule, contempt, and
1. Ordering the defendant RCPI to pay plaintiff the amount of humiliation of the private respondents and the addressees, including
P30,848.05 representing actual and compensatory damages; their friends and relatives, the spouses Timan demanded an
P10,000.00 as moral damages and P5,000.00 as exemplary explanation. Unsatisfied with RCPI's explanations in its letters, dated
damages. March 9 and April 20, 1983, the Timans filed a complaint for
damages.6
2. Awarding of attorney's fees in the sum of P5,000.00. Costs
against the defendant. The parties stipulated at the pre-trial that the issue to be resolved by
the trial court was:
SO ORDERED.3
WHETHER or not the act of delivering the condolence
The facts as gleaned from the records of the case are as follows: message in a Happy Birthday" card with a "Christmasgram"
envelope constitutes a breach of contract on the part of the
defendant. If in the affirmative, whether or not plaintiff is
On January 24, 1983, private respondents-spouses Minerva Timan and
Flores Timan sent a telegram of condolence to their cousins, Mr. and entitled to damages.7
The trial court rendered judgment in favor of the respondents Timans exercise that degree of diligence expected of it in the performance of
which was affirmed in toto by the Court of Appeals. RCPI now its obligation.9
submits the following assignment of errors:
One of RCPI's main arguments is that it still correctly transmitted the
I text of the telegram and was received by the addressees on time despite
the fact that there was "error" in the social form and envelope
THE RESPONDENT COURT ERRED IN CONDEMNING used.10 RCPI asserts that there was no showing that it has any motive
PETITIONER TO PAY ACTUAL AND COMPENSATORY to cause harm or damage on private respondents:
DAMAGES IN THE AMOUNT OF P30,848.05.
Petitioner humbly submits that the "error" in the social form
II used does not come within the ambit of fraud, malice or bad
faith as understood/defined under the law. 11
THE RESPONDENT COURT ERRED IN CONDEMNING
PETITIONER TO PAY MORAL DAMAGES IN THE We do not agree.
AMOUNT OF P10,000.00.
In a distinctly similar case,12 and oddly also involving the herein
III petitioner as the same culprit, we held:

THE RESPONDENT COURT ERRED IN CONDEMNING Petitioner is a domestic corporation engaged in the business
PETITIONER TO PAY EXEMPLARY DAMAGES IN THE of receiving and transmitting messages. Everytime a person
AMOUNT OF P5,000.00. transmits a message through the facilities of the petitioner, a
contract is entered into. Upon receipt of the rate or fee fixed,
IV the petitioner undertakes to transmit the message accurately .
. . As a corporation, the petitioner can act only through its
THE RESPONDENT COURT ERRED IN CONDEMNING employees. Hence the acts of its employees in receiving and
PETITIONER TO PAY ATTORNEYS FEES IN THE transmitting messages are the acts of the petitioner. To hold
AMOUNT OF P5,000.00 PLUS COSTS OF SUIT. 8 that the petitioner is not liable directly for the acts of its
employees in the pursuit of petitioner's business is to deprive
The four assigned errors are going to be discussed jointly because they the general public availing of the services of the petitioner of
are all based on the same findings of fact. an effective and adequate remedy. 13

We fully agree with the appellate court's endorsement of the trial Now, in the present case, it is self-evident that a telegram of
court's conclusion that RCPI, a corporation dealing in condolence is intended and meant to convey a message of sorrow and
sympathy. Precisely, it is denominated "telegram of condolence"
telecommunications and offering its services to the public, is engaged
in a business affected with public interest. As such, it is bound to because it tenders sympathy and offers to share another's grief. It
seems out of this world, therefore, to place that message of condolence
in a birthday card and deliver the same in a Christmas envelope for respondent Minerva Timan, he suffered nervousness and hypertension
such acts of carelessness and incompetence not only render violence resulting in his confinement for three days starting from April 4, 1983
to good taste and common sense, they depict a bizarre presentation of at the Capitol Medical Center in Quezon City. 15
the sender's feelings. They ridicule the deceased's loved ones and
destroy the atmosphere of grief and respect for the departed. The petitioner argues that "a court cannot rely on speculation,
conjectures or guess work as to the fact and amount of damages, but
Anyone who avails of the facilities of a telegram company like RCPI must depend on the actual proof that damages had been suffered and
can choose to send his message in the ordinary form or in a social evidence of the actual amount.16 In other words, RCPI insists that there
form. In the ordinary form, the text of the message is typed on plain is no causal relation of the illness suffered by Mr. Timan with the foul-
newsprint paper. On the other hand, a social telegram is placed in a up caused by the petitioner. But that is a question of fact. The findings
special form with the proper decorations and embellishments to suit of fact of the trial court and the respondent court concur in favor of the
the occasion and the message and delivered in an envelope matching private respondents. We are bound by such findings—that is the
the purpose of the occasion and the words and intent of the message. general rule well-established by a long line of cases. Nothing has been
The sender pays a higher amount for the social telegram than for one shown to convince us to justify the relaxation of this rule in the
in the ordinary form. It is clear, therefore, that when RCPI typed the petitioner's favor. On the contrary, these factual findings are supported
private respondents' message of condolence in a birthday card and by substantial evidence on record.
delivered the same in a colorful Christmasgram envelope, it
committed a breach of contract as well as gross negligence. Its excuse Anent the award of moral and exemplary damages assigned as errors,
that it had run out of social condolence cards and envelopes 14 is flimsy the findings of the respondent court are persuasive.
and unacceptable. It could not have been faulted had it delivered the
message in the ordinary form and reimbursed the difference in the cost . . . When plaintiffs placed an order for transmission of their
to the private respondents. But by transmitting it unfittingly—through social condolence telegram, defendant did not inform the
other special forms clearly, albeit outwardly, portraying the opposite plaintiff of the exhaustion of such social condolence forms.
feelings of joy and happiness and thanksgiving—RCPI only Defendant-appellant accepted through its authorized agent or
exacerbated the sorrowful situation of the addressees and the senders. agency the order and received the corresponding
It bears stress that this botchery exposed not only the petitioner's gross compensation therefor. Defendant did not comply with its
negligence but also its callousness and disregard for the sentiments of contract as intended by the parties and instead of transmitting
its clientele, which tantamount to wanton misconduct, for which it the condolence message in an ordinary form, in accordance
must be held liable for damages. with its guidelines, placed the condolence message expressing
sadness and sorrow in forms conveying joy and happiness.
It is not surprising that when the Timans' telegraphic message reached Under the circumstances, We cannot accept the defendant's
their cousin, it became the joke of the Midorandas' friends, relatives, plea of good faith predicated on such exhaustion of social
and associates who thought, and rightly so, that the unpardonable mix- condolence forms. Gross negligence or carelessness can be
up was a mockery of the death of the mother-in-law of the senders' attributed to defendant-appellant in not supplying its various
cousin. Thus it was not unexpected that because of this unusual stations with such sufficient and adequate social condolence
incident, which caused much embarrassment and distress to forms when it held out to the public sometime in January,
 1983, the availability of such social condolence forms and was time and again held liable for the same causes as in the present
accepted for a fee the transmission of messages on said forms. case breach of contract and gross negligence—the ineluctable
Knowing that there are no such forms as testified to by its conclusion is that it has not in any way reformed nor improved its
Material Control Manager Mateo Atienza, and entering into a services to the public. It must do so now or else next time the Court
contract for the transmission of messages in such forms, may be constrained to adjudge stricter sanctions.
defendant-appellant committed acts of bad faith, fraud or
malice. . . .17 WHEREFORE, premises considered, the decision appealed from is
AFFIRMED in toto.
RCPI's argument that it can not be held liable for exemplary damages,
being penal or punitive in character,18 is without merit. We have so Costs against the petitioner.
held in many cases, and oddly, quite a number of them likewise
involved the herein petitioner as the transgressor. SO ORDERED.

xxx xxx xxx

. . . In contracts and quasi-contracts, exemplary damages may

be awarded if the defendant acted in a wanton, fraudulent,
reckless, oppressive or malevolent manner. There was gross
negligence on the part of RCPI personnel in transmitting the
wrong telegram, of which RCPI must be held liable. Gross
carelessness or negligence constitutes wanton misconduct.

xxx xxx xxx

. . . punitive damages may be recovered for wilful or wantonly

negligent acts in respect of messages, even though those acts
are neither authorized nor ratified (Arkansas & L.R. Co. vs.
Stroude 91 SW 18; West vs. Western U. Tel. Co., 17 P807;
Peterson vs. Western U. Tel. Co., 77 NW 985; Brown vs.
Western U. Tel. Co., 6 SE 146). Thus, punitive damages have
been recovered for mistakes in the transmission of telegrams
(Pittman vs. Western Union Tel. Co., 66 SO 977; Painter vs.
Western Union Tel. Co., 84 SE 293) (emphasis supplied). 19

We wish to add a little footnote to this Decision. By merely reviewing

the number of cases that has reached this Court in which the petitioner
G.R. No. L-16439 July 20, 1961 proved to be inconvenient, she had herself aborted again by
the defendant in October 1953. Less than two years later, she
ANTONIO GELUZ, petitioner, again became pregnant. On February 21, 1955, accompanied
vs. by her sister Purificacion and the latter's daughter Lucida, she
THE HON. COURT OF APPEALS and OSCAR again repaired to the defendant's clinic on Carriedo and P.
LAZO, respondents. Gomez streets in Manila, where the three met the defendant
and his wife. Nita was again aborted, of a two-month old
Mariano H. de Joya for petitioner. foetus, in consideration of the sum of fifty pesos, Philippine
A.P. Salvador for respondents. currency. The plaintiff was at this time in the province of
Cagayan, campaigning for his election to the provincial board;
REYES, J.B.L., J.: he did not know of, nor gave his consent, to the abortion.

This petition for certiorari brings up for review question whether the It is the third and last abortion that constitutes plaintiff's basis in filing
husband of a woman, who voluntarily procured her abortion, could this action and award of damages. Upon application of the defendant
recover damages from physician who caused the same. Geluz we granted certiorari.

The litigation was commenced in the Court of First Instance of Manila The Court of Appeals and the trial court predicated the award of
by respondent Oscar Lazo, the of Nita Villanueva, against petitioner damages in the sum of P3,000.06 upon the provisions of the initial
Antonio Geluz, a physician. Convinced of the merits of the complaint paragraph of Article 2206 of the Civil Code of the Philippines. This
upon the evidence adduced, the trial court rendered judgment favor of we believe to be error, for the said article, in fixing a minimum award
plaintiff Lazo and against defendant Geluz, ordering the latter to pay of P3,000.00 for the death of a person, does not cover the case of an
P3,000.00 as damages, P700.00 attorney's fees and the costs of the unborn foetus that is not endowed with personality. Under the system
suit. On appeal, Court of Appeals, in a special division of five, of our Civil Code, "la criatura abortiva no alcanza la categoria de
sustained the award by a majority vote of three justices as against two, persona natural y en consscuencia es un ser no nacido a la vida del
who rendered a separate dissenting opinion. Derecho" (Casso-Cervera, "Diccionario de Derecho Privado", Vol. 1,
p. 49), being incapable of having rights and obligations.
The facts are set forth in the majority opinion as follows:
Since an action for pecuniary damages on account of personal injury
Nita Villanueva came to know the defendant (Antonio Geluz) or death pertains primarily to the one injured, it is easy to see that if
no action for such damages could be instituted on behalf of the unborn
for the first time in 1948 — through her aunt Paula Yambot.
In 1950 she became pregnant by her present husband before child on account of the injuries it received, no such right of action
they were legally married. Desiring to conceal her pregnancy could derivatively accrue to its parents or heirs. In fact, even if a cause
from her parent, and acting on the advice of her aunt, she had of action did accrue on behalf of the unborn child, the same was
herself aborted by the defendant. After her marriage with the extinguished by its pre-natal death, since no transmission to anyone
plaintiff, she again became pregnant. As she was then can take place from on that lacked juridical personality (or juridical
employed in the Commission on Elections and her pregnancy capacity as distinguished from capacity to act). It is no answer to
invoke the provisional personality of a conceived child (conceptus pro abortion, the appellee does not seem to have taken interest in the
nato habetur) under Article 40 of the Civil Code, because that same administrative and criminal cases against the appellant. His only
article expressly limits such provisional personality by imposing the concern appears to have been directed at obtaining from the doctor a
condition that the child should be subsequently born alive: "provided large money payment, since he sued for P50,000.00 damages and
it be born later with the condition specified in the following article". P3,000.00 attorney's fees, an "indemnity" claim that, under the
In the present case, there is no dispute that the child was dead when circumstances of record, was clearly exaggerated.
separated from its mother's womb.
The dissenting Justices of the Court of Appeals have aptly remarked
The prevailing American jurisprudence is to the same effect; and it is that:
generally held that recovery can not had for the death of an unborn
child (Stafford vs. Roadway Transit Co., 70 F. Supp. 555; Dietrich vs. It seems to us that the normal reaction of a husband who
Northampton, 52 Am. Rep. 242; and numerous cases collated in the righteously feels outraged by the abortion which his wife has
editorial note, 10 ALR, (2d) 639). deliberately sought at the hands of a physician would be
highminded rather than mercenary; and that his primary
This is not to say that the parents are not entitled to collect any concern would be to see to it that the medical profession was
damages at all. But such damages must be those inflicted directly upon purged of an unworthy member rather than turn his wife's
them, as distinguished from the injury or violation of the rights of the indiscretion to personal profit, and with that idea in mind to
deceased, his right to life and physical integrity. Because the parents press either the administrative or the criminal cases he had
can not expect either help, support or services from an unborn child, filed, or both, instead of abandoning them in favor of a civil
they would normally be limited to moral damages for the illegal arrest action for damages of which not only he, but also his wife,
of the normal development of the spes hominis that was the foetus, would be the beneficiaries.
i.e., on account of distress and anguish attendant to its loss, and the
disappointment of their parental expectations (Civ. Code Art. 2217), It is unquestionable that the appellant's act in provoking the abortion
as well as to exemplary damages, if the circumstances should warrant of appellee's wife, without medical necessity to warrant it, was a
them (Art. 2230). But in the case before us, both the trial court and the criminal and morally reprehensible act, that can not be too severely
Court of Appeals have not found any basis for an award of moral condemned; and the consent of the woman or that of her husband does
damages, evidently because the appellee's indifference to the previous not excuse it. But the immorality or illegality of the act does not justify
abortions of his wife, also caused by the appellant herein, clearly an award of damage that, under the circumstances on record, have no
indicates that he was unconcerned with the frustration of his parental factual or legal basis.
hopes and affections. The lower court expressly found, and the
majority opinion of the Court of Appeals did not contradict it, that the The decision appealed from is reversed, and the complaint ordered
appellee was aware of the second abortion; and the probabilities are dismissed. Without costs.
that he was likewise aware of the first. Yet despite the suspicious
repetition of the event, he appeared to have taken no steps to
investigate or pinpoint the causes thereof, and secure the punishment
of the responsible practitioner. Even after learning of the third
G.R. No. 97412 July 12, 1994 vessel "SS EASTERN COMET" owned by defendant
Eastern Shipping Lines under Bill of Lading
EASTERN SHIPPING LINES, INC., petitioner, No. YMA-8 (Exh. B). The shipment was insured
vs. under plaintiff's Marine Insurance Policy No.
HON. COURT OF APPEALS AND MERCANTILE 81/01177 for P36,382,466.38.
INSURANCE COMPANY, INC., respondents.
Upon arrival of the shipment in Manila on December
Alojada & Garcia and Jimenea, Dala & Zaragoza for petitoner. 12, 1981, it was discharged unto the custody of
defendant Metro Port Service, Inc. The latter
Zapa Law Office for private respondent. excepted to one drum, said to be in bad order, which
damage was unknown to plaintiff.

On January 7, 1982 defendant Allied Brokerage

VITUG, J.: Corporation received the shipment from defendant
Metro Port Service, Inc., one drum opened and
The issues, albeit not completely novel, are: (a) whether or not a claim without seal (per "Request for Bad Order Survey."
for damage sustained on a shipment of goods can be a solidary, or joint Exh. D).
and several, liability of the common carrier, the arrastre operator and
the customs broker; (b) whether the payment of legal interest on an On January 8 and 14, 1982, defendant Allied
award for loss or damage is to be computed from the time the Brokerage Corporation made deliveries of the
complaint is filed or from the date the decision appealed from is shipment to the consignee's warehouse. The latter
rendered; and (c) whether the applicable rate of interest, referred to excepted to one drum which contained spillages,
above, is twelve percent (12%) or six percent (6%). while the rest of the contents was adulterated/fake
(per "Bad Order Waybill" No. 10649, Exh. E).
The findings of the court a quo, adopted by the Court of Appeals, on
the antecedent and undisputed facts that have led to the controversy Plaintiff contended that due to the losses/damage
are hereunder reproduced: sustained by said drum, the consignee suffered losses
totaling P19,032.95, due to the fault and negligence
This is an action against defendants shipping of defendants. Claims were presented against
company, arrastre operator and broker-forwarder for defendants who failed and refused to pay the same
damages sustained by a shipment while in defendants' (Exhs. H, I, J, K, L).
custody, filed by the insurer-subrogee who paid the
consignee the value of such losses/damages. As a consequence of the losses sustained, plaintiff
was compelled to pay the consignee P19,032.95
On December 4, 1981, two fiber drums of riboflavin under the aforestated marine insurance policy, so that
were shipped from Yokohama, Japan for delivery it became subrogated to all the rights of action of said
 consignee against defendants (per "Form of whose respective custody, if
Subrogation", "Release" and Philbanking check, determinable);
Exhs. M, N, and O). (pp. 85-86, Rollo.)
3. Whether or not defendant(s)
There were, to be sure, other factual issues that confronted both courts. should be held liable for the
Here, the appellate court said: losses/damages (see plaintiff's pre-
Trial Brief, Records, p. 34; Allied's
Defendants filed their respective answers, traversing pre-Trial Brief, adopting plaintiff's
the material allegations of the complaint contending Records, p. 38).
that: As for defendant Eastern Shipping it alleged that
the shipment was discharged in good order from the As to the first issue, there can be no
vessel unto the custody of Metro Port Service so that doubt that the shipment sustained
any damage/losses incurred after the shipment was losses/damages. The two drums were
incurred after the shipment was turned over to the shipped in good order and condition,
latter, is no longer its liability (p. 17, Record); as clearly shown by the Bill of
Metroport averred that although subject shipment was Lading and Commercial Invoice
discharged unto its custody, portion of the same was which do not indicate any damages
already in bad order (p. 11, Record); Allied Brokerage drum that was shipped (Exhs. B and
alleged that plaintiff has no cause of action against it, C). But when on December 12, 1981
not having negligent or at fault for the shipment was the shipment was delivered to
already in damage and bad order condition when defendant Metro Port Service, Inc., it
received by it, but nonetheless, it still exercised extra excepted to one drum in bad order.
ordinary care and diligence in the handling/delivery
of the cargo to consignee in the same condition Correspondingly, as to the second
shipment was received by it. issue, it follows that the
losses/damages were sustained while
From the evidence the court found the following: in the respective and/or successive
custody and possession of
The issues are: defendants carrier (Eastern), arrastre
operator (Metro Port) and broker
1. Whether or not the shipment (Allied Brokerage). This becomes
sustained losses/damages; evident when the Marine Cargo
Survey Report (Exh. G), with its
2. Whether or not these "Additional Survey Notes", are
losses/damages were sustained while considered. In the latter notes, it is
in the custody of defendants (in stated that when the shipment was
"landed on vessel" to dock of Pier # Over Survey of Bad Order Cargoes"
15, South Harbor, Manila on (Exhs. 3-Eastern) states that on
December 12, 1981, it was observed December 12, 1981 one drum was
that "one (1) fiber drum (was) in found "open".
damaged condition, covered by the
vessel's Agent's Bad Order Tally and thus held:
Sheet No. 86427." The report further
states that when defendant Allied WHEREFORE, PREMISES
Brokerage withdrew the shipment CONSIDERED, judgment is hereby
from defendant arrastre operator's rendered:
custody on January 7, 1982, one
drum was found opened without seal, A. Ordering defendants to pay plaintiff, jointly and
cello bag partly torn but contents severally:
intact. Net unrecovered spillages was
15 kgs. The report went on to state 1. The amount of P19,032.95, with
that when the drums reached the the present legal interest of 12% per
consignee, one drum was found with
annum from October 1, 1982, the
adulterated/faked contents. It is date of filing of this complaints, until
obvious, therefore, that these fully paid (the liability of defendant
losses/damages occurred before the
Eastern Shipping, Inc. shall not
shipment reached the consignee exceed US$500 per case or the CIF
while under the successive custodies value of the loss, whichever is lesser,
of defendants. Under Art. 1737 of the while the liability of defendant Metro
New Civil Code, the common Port Service, Inc. shall be to the
carrier's duty to observe extent of the actual invoice value of
extraordinary diligence in the each package, crate box or container
vigilance of goods remains in full
in no case to exceed P5,000.00 each,
force and effect even if the goods are pursuant to Section 6.01 of the
temporarily unloaded and stored in Management Contract);
transit in the warehouse of the carrier
at the place of destination, until the
2. P3,000.00 as attorney's fees, and
consignee has been advised and has
had reasonable opportunity to
remove or dispose of the goods (Art. 3. Costs.
1738, NCC). Defendant Eastern
Shipping's own exhibit, the "Turn- B. Dismissing the
counterclaims and
 crossclaim of SHOULD COMMENCE FROM THE DATE OF
defendant/cross- THE FILING OF THE COMPLAINT AT THE
claimant Allied RATE OF TWELVE PERCENT PER
Brokerage ANNUM INSTEAD OF FROM THE DATE OF THE
Corporation. DECISION OF THE TRIAL COURT AND ONLY
AT THE RATE OF SIX PERCENT PER ANNUM,
SO ORDERED. (p. 207, Record). PRIVATE RESPONDENT'S CLAIM BEING
INDISPUTABLY UNLIQUIDATED.
Dissatisfied, defendant's recourse to US.
The petition is, in part, granted.
The appeal is devoid of merit.
In this decision, we have begun by saying that the questions raised by
After a careful scrutiny of the evidence on record. We petitioner carrier are not all that novel. Indeed, we do have a fairly
find that the conclusion drawn therefrom is correct. good number of previous decisions this Court can merely tack to.
As there is sufficient evidence that the shipment
sustained damage while in the successive possession The common carrier's duty to observe the requisite diligence in the
of appellants, and therefore they are liable to the shipment of goods lasts from the time the articles are surrendered to
appellee, as subrogee for the amount it paid to the or unconditionally placed in the possession of, and received by, the
consignee. (pp. 87-89, Rollo.) carrier for transportation until delivered to, or until the lapse of a
reasonable time for their acceptance by, the person entitled to receive
The Court of Appeals thus affirmed in toto the judgment of the court them (Arts. 1736-1738, Civil Code; Ganzon vs. Court of Appeals, 161
a quo. SCRA 646; Kui Bai vs. Dollar Steamship Lines, 52 Phil. 863). When
the goods shipped either are lost or arrive in damaged condition, a
In this petition, Eastern Shipping Lines, Inc., the common carrier, presumption arises against the carrier of its failure to observe that
attributes error and grave abuse of discretion on the part of the diligence, and there need not be an express finding of negligence to
appellate court when — hold it liable (Art. 1735, Civil Code; Philippine National Railways vs.
Court of Appeals, 139 SCRA 87; Metro Port Service vs. Court of
I. IT HELD PETITIONER CARRIER JOINTLY Appeals, 131 SCRA 365). There are, of course, exceptional cases
AND SEVERALLY LIABLE WITH THE when such presumption of fault is not observed but these cases,
enumerated in Article 17341 of the Civil Code, are exclusive, not one
ARRASTRE OPERATOR AND CUSTOMS
BROKER FOR THE CLAIM OF PRIVATE of which can be applied to this case.
RESPONDENT AS GRANTED IN THE
QUESTIONED DECISION; The question of charging both the carrier and the arrastre operator with
the obligation of properly delivering the goods to the consignee has,
II. IT HELD THAT THE GRANT OF INTEREST too, been passed upon by the Court. In Fireman's Fund Insurance
ON THE CLAIM OF PRIVATE RESPONDENT
vs. Metro Port Services (182 SCRA 455), we have explained, in Let us first see a chronological recitation of the major rulings of this
holding the carrier and the arrastre operator liable in solidum, thus: Court:

The legal relationship between the consignee and the The early case of Malayan Insurance Co., Inc., vs. Manila Port
arrastre operator is akin to that of a depositor and Service,2 decided3 on 15 May 1969, involved a suit for recovery of
warehouseman (Lua Kian v. Manila Railroad Co., 19 money arising out of short deliveries and pilferage of goods. In this
SCRA 5 [1967]. The relationship between the case, appellee Malayan Insurance (the plaintiff in the lower court)
consignee and the common carrier is similar to that of averred in its complaint that the total amount of its claim for the value
the consignee and the arrastre operator (Northern of the undelivered goods amounted to P3,947.20. This demand,
Motors, Inc. v. Prince Line, et al., 107 Phil. 253 however, was neither established in its totality nor definitely
[1960]). Since it is the duty of the ARRASTRE to ascertained. In the stipulation of facts later entered into by the parties,
take good care of the goods that are in its custody and in lieu of proof, the amount of P1,447.51 was agreed upon. The trial
to deliver them in good condition to the consignee, court rendered judgment ordering the appellants (defendants) Manila
such responsibility also devolves upon the Port Service and Manila Railroad Company to pay appellee Malayan
CARRIER. Both the ARRASTRE and the CARRIER Insurance the sum of P1,447.51 with legal interest thereon from the
are therefore charged with the obligation to deliver date the complaint was filed on 28 December 1962 until full payment
the goods in good condition to the consignee. thereof. The appellants then assailed, inter alia, the award of legal
interest. In sustaining the appellants, this Court ruled:
We do not, of course, imply by the above pronouncement that the
arrastre operator and the customs broker are themselves always and Interest upon an obligation which calls for the
necessarily liable solidarily with the carrier, or vice-versa, nor that payment of money, absent a stipulation, is the legal
attendant facts in a given case may not vary the rule. The instant rate. Such interest normally is allowable from the date
petition has been brought solely by Eastern Shipping Lines, which, of demand, judicial or extrajudicial. The trial court
being the carrier and not having been able to rebut the presumption of opted for judicial demand as the starting point.
fault, is, in any event, to be held liable in this particular case. A factual
finding of both the court a quo and the appellate court, we take note, But then upon the provisions of Article 2213 of the
is that "there is sufficient evidence that the shipment sustained damage Civil Code, interest "cannot be recovered upon
while in the successive possession of appellants" (the herein petitioner unliquidated claims or damages, except when the
among them). Accordingly, the liability imposed on Eastern Shipping demand can be established with reasonable
Lines, Inc., the sole petitioner in this case, is inevitable regardless of certainty." And as was held by this Court in Rivera
whether there are others solidarily liable with it. vs. Perez,4 L-6998, February 29, 1956, if the suit were
for damages, "unliquidated and not known until
It is over the issue of legal interest adjudged by the appellate court that definitely ascertained, assessed and determined by
deserves more than just a passing remark. the courts after proof (Montilla c. Corporacion de
P.P. Agustinos, 25 Phil. 447; Lichauco v. Guzman,
 38 Phil. 302)," then, interest "should be from the date this was when the trial court issued its assailed resolution
of the decision." (Emphasis supplied) which applied the 6% interest per annum prescribed in Article
2209 of the Civil Code. In their petition for review
The case of Reformina vs. Tomol,5 rendered on 11 October 1985, was on certiorari, the petitioners contended that Central Bank
for "Recovery of Damages for Injury to Person and Loss of Circular
Property." After trial, the lower court decreed: No. 416, providing thus —

WHEREFORE, judgment is hereby rendered in favor By virtue of the authority granted to it under Section
of the plaintiffs and third party defendants and against 1 of Act 2655, as amended, Monetary Board in its
the defendants and third party plaintiffs as follows: Resolution No. 1622 dated July 29, 1974, has
prescribed that the rate of interest for the loan, or
Ordering defendants and third party plaintiffs Shell forbearance of any money, goods, or credits and the
and Michael, Incorporated to pay jointly and rate allowed in judgments, in the absence of express
severally the following persons: contract as to such rate of interest, shall be twelve
(12%) percent per annum. This Circular shall take
xxx xxx xxx effect immediately. (Emphasis found in the text) —

(g) Plaintiffs Pacita F. Reformina and Francisco should have, instead, been applied. This Court6 ruled:
Reformina the sum of P131,084.00 which is the value
of the boat F B Pacita III together with its accessories, The judgments spoken of and referred to are
fishing gear and equipment minus P80,000.00 which judgments in litigations involving loans or
is the value of the insurance recovered and the amount forbearance of any money, goods or credits. Any
of P10,000.00 a month as the estimated monthly loss other kind of monetary judgment which has nothing
suffered by them as a result of the fire of May 6, 1969 to do with, nor involving loans or forbearance of any
up to the time they are actually paid or already the money, goods or credits does not fall within the
total sum of P370,000.00 as of June 4, 1972 with legal coverage of the said law for it is not within the ambit
interest from the filing of the complaint until paid and of the authority granted to the Central Bank.
to pay attorney's fees of P5,000.00 with costs against
defendants and third party plaintiffs. (Emphasis xxx xxx xxx
supplied.)
Coming to the case at bar, the decision herein sought
On appeal to the Court of Appeals, the latter modified the to be executed is one rendered in an Action for
amount of damages awarded but sustained the trial court in Damages for injury to persons and loss of property
adjudging legal interest from the filing of the complaint until and does not involve any loan, much less
fully paid. When the appellate court's decision became final, forbearances of any money, goods or credits. As
the case was remanded to the lower court for execution, and correctly argued by the private respondents, the law
 applicable to the said case is Article 2209 of the New WHEREFORE, the decision appealed from is hereby
Civil Code which reads — MODIFIED and considering the special and
environmental circumstances of this case, we deem it
Art. 2209. — If the obligation reasonable to render a decision imposing, as We do
consists in the payment of a sum of hereby impose, upon the defendant and the third-
money, and the debtor incurs in party defendants (with the exception of Roman
delay, the indemnity for damages, Ozaeta) a solidary (Art. 1723, Civil Code, Supra.
there being no stipulation to the p. 10) indemnity in favor of the Philippine Bar
contrary, shall be the payment of Association of FIVE MILLION (P5,000,000.00)
interest agreed upon, and in the Pesos to cover all damages (with the exception to
absence of stipulation, the legal attorney's fees) occasioned by the loss of the building
interest which is six percent per (including interest charges and lost rentals) and an
annum. additional ONE HUNDRED THOUSAND
(P100,000.00) Pesos as and for attorney's fees, the
The above rule was reiterated in Philippine Rabbit Bus Lines, Inc., total sum being payable upon the finality of this
v. Cruz,7 promulgated on 28 July 1986. The case was for damages decision. Upon failure to pay on such finality, twelve
occasioned by an injury to person and loss of property. The trial court (12%) per cent interest per annum shall be imposed
awarded private respondent Pedro Manabat actual and compensatory upon aforementioned amounts from finality until
damages in the amount of P72,500.00 with legal interest thereon from paid. Solidary costs against the defendant and third-
the filing of the complaint until fully paid. Relying on the Reformina party defendants (Except Roman Ozaeta). (Emphasis
v. Tomol case, this Court8 modified the interest award from 12% to 6% supplied)
interest per annum but sustained the time computation thereof, i.e.,
from the filing of the complaint until fully paid. A motion for reconsideration was filed by United
Construction, contending that "the interest of twelve (12%)
In Nakpil and Sons vs. Court of Appeals,9 the trial court, in an action per cent per annum imposed on the total amount of the
for the recovery of damages arising from the collapse of a building, monetary award was in contravention of law." The
ordered, Court10 ruled out the applicability of the Reformina and
inter alia, the "defendant United Construction Co., Inc. (one of the Philippine Rabbit Bus Lines cases and, in its resolution of 15
petitioners) April 1988, it explained:
. . . to pay the plaintiff, . . . , the sum of P989,335.68 with interest at
the legal rate from November 29, 1968, the date of the filing of the There should be no dispute that the imposition of 12%
complaint until full payment . . . ." Save from the modification of the interest pursuant to Central Bank Circular No. 416 . .
amount granted by the lower court, the Court of Appeals sustained the . is applicable only in the following: (1) loans; (2)
trial court's decision. When taken to this Court for review, the case, on forbearance of any money, goods or credit; and
03 October 1986, was decided, thus: (3) rate allowed in judgments (judgments spoken of
refer to judgments involving loans or forbearance of
 any money, goods or credits. (Philippine Rabbit Bus Reformina came into fore again in the 21 February 1989 case
Lines Inc. v. Cruz, 143 SCRA 160-161 [1986]; of Florendo v. Ruiz13 which arose from a breach of employment
Reformina v. Tomol, Jr., 139 SCRA 260 [1985]). It is contract. For having been illegally dismissed, the petitioner was
true that in the instant case, there is neither a loan or awarded by the trial court moral and exemplary damages without,
a forbearance, but then no interest is actually however, providing any legal interest thereon. When the decision was
imposed provided the sums referred to in the appealed to the Court of Appeals, the latter held:
judgment are paid upon the finality of the judgment. It
is delay in the payment of such final judgment, that WHEREFORE, except as modified hereinabove the
will cause the imposition of the interest. decision of the CFI of Negros Oriental dated October
31, 1972 is affirmed in all respects, with the
It will be noted that in the cases already adverted to, modification that defendants-appellants, except
the rate of interest is imposed on the total sum, from defendant-appellant Merton Munn, are ordered to
the filing of the complaint until paid; in other words, pay, jointly and severally, the amounts stated in the
as part of the judgment for damages. Clearly, they are dispositive portion of the decision, including the sum
not applicable to the instant case. (Emphasis of P1,400.00 in concept of compensatory damages,
supplied.) with interest at the legal rate from the date of the
filing of the complaint until fully paid (Emphasis
The subsequent case of American Express International, Inc., supplied.)
vs. Intermediate Appellate Court11 was a petition for review
on certiorari from the decision, dated 27 February 1985, of the then The petition for review to this Court was denied. The records
Intermediate Appellate Court reducing the amount of moral and were thereupon transmitted to the trial court, and an entry of
exemplary damages awarded by the trial court, to P240,000.00 and judgment was made. The writ of execution issued by the trial
P100,000.00, respectively, and its resolution, dated 29 April 1985, court directed that only compensatory damages should earn
restoring the amount of damages awarded by the trial court, i.e., interest at 6% per annum from the date of the filing of the
P2,000,000.00 as moral damages and P400,000.00 as exemplary complaint. Ascribing grave abuse of discretion on the part of
damages with interest thereon at 12% per annum from notice of the trial judge, a petition for certiorari assailed the said order.
judgment, plus costs of suit. In a decision of 09 November 1988, this This Court said:
Court, while recognizing the right of the private respondent to recover
damages, held the award, however, for moral damages by the trial . . . , it is to be noted that the Court of Appeals ordered
court, later sustained by the IAC, to be inconceivably large. The the payment of interest "at the legal rate" from the
Court12 thus set aside the decision of the appellate court and rendered time of the filing of the complaint. . . Said circular
a new one, "ordering the petitioner to pay private respondent the sum [Central Bank Circular No. 416] does not apply to
of One Hundred Thousand (P100,000.00) Pesos as moral damages, actions based on a breach of employment contract like
with the case at bar. (Emphasis supplied)
six (6%) percent interest thereon computed from the finality of this
decision until paid. (Emphasis supplied)
 The Court reiterated that the 6% interest per annum on the group" would be Malayan Insurance Company v. Manila Port
damages should be computed from the time the complaint was Service (1969), Nakpil and Sons v. Court of
filed until the amount is fully paid. Appeals (1988), and American Express International v. Intermediate
Appellate Court (1988).
Quite recently, the Court had another occasion to rule on the
matter. National Power Corporation vs. Angas,14 decided on 08 May In the "first group", the basic issue focuses on the application of either
1992, involved the expropriation of certain parcels of land. After the 6% (under the Civil Code) or 12% (under the Central Bank
conducting a hearing on the complaints for eminent domain, the trial Circular) interest per annum. It is easily discernible in these cases that
court ordered the petitioner to pay the private respondents certain sums there has been a consistent holding that the Central Bank Circular
of money as just compensation for their lands so expropriated "with imposing the 12% interest per annum applies only to loans or
legal interest thereon . . . until fully paid." Again, in applying the 6% forbearance16 of money, goods or credits, as well as to judgments
legal interest per annum under the Civil Code, the Court15 declared: involving such loan or forbearance of money, goods or credits, and
that the 6% interest under the Civil Code governs when the transaction
. . . , (T)he transaction involved is clearly not a loan involves the payment of indemnities in the concept of damage arising
or forbearance of money, goods or credits but from the breach or a delay in the performance of obligations in
expropriation of certain parcels of land for a public general. Observe, too, that in these cases, a common time frame in the
purpose, the payment of which is without stipulation computation of the 6% interest per annum has been applied, i.e., from
regarding interest, and the interest adjudged by the the time the complaint is filed until the adjudged amount is fully paid.
trial court is in the nature of indemnity for damages.
The legal interest required to be paid on the amount The "second group", did not alter the pronounced rule on the
of just compensation for the properties expropriated application of the 6% or 12% interest per annum,17 depending on
is manifestly in the form of indemnity for damages whether or not the amount involved is a loan or forbearance, on the
for the delay in the payment thereof. Therefore, since one hand, or one of indemnity for damage, on the other hand. Unlike,
the kind of interest involved in the joint judgment of however, the "first group" which remained consistent in holding that
the lower court sought to be enforced in this case is the running of the legal interest should be from the time of the filing
interest by way of damages, and not by way of of the complaint until fully paid, the "second group" varied on the
earnings from loans, etc. Art. 2209 of the Civil Code commencement of the running of the legal interest.
shall apply.
Malayan held that the amount awarded should bear legal interest from
Concededly, there have been seeming variances in the above holdings. the date of the decision of the court a quo, explaining that "if the suit
The cases can perhaps be classified into two groups according to the were for damages, 'unliquidated and not known until definitely
similarity of the issues involved and the corresponding rulings ascertained, assessed and determined by the courts after proof,' then,
rendered by the court. The "first group" would consist of the cases interest 'should be from the date of the decision.'" American Express
of Reformina v. Tomol (1985), Philippine Rabbit Bus Lines International v. IAC, introduced a different time frame for reckoning
v. Cruz (1986), Florendo v. Ruiz (1989) the 6% interest by ordering it to be "computed from the finality of (the)
and National Power Corporation v. Angas (1992). In the "second decision until paid." The Nakpil and Sons case ruled that 12%
interest per annum should be imposed from the finality of the decision from the time the claim is made judicially or extrajudicially (Art.
until the judgment amount is paid. 1169, Civil Code) but when such certainty cannot be so reasonably
established at the time the demand is made, the interest shall begin to
The ostensible discord is not difficult to explain. The factual run only from the date the judgment of the court is made (at which
circumstances may have called for different applications, guided by time the quantification of damages may be deemed to have been
the rule that the courts are vested with discretion, depending on the reasonably ascertained). The actual base for the computation of legal
equities of each case, on the award of interest. Nonetheless, it may not interest shall, in any case, be on the amount finally adjudged.
be unwise, by way of clarification and reconciliation, to suggest the
following rules of thumb for future guidance. 3. When the judgment of the court awarding a sum of money becomes
final and executory, the rate of legal interest, whether the case falls
I. When an obligation, regardless of its source, i.e., law, contracts, under paragraph 1 or paragraph 2, above, shall be 12% per
quasi-contracts, delicts or quasi-delicts18 is breached, the contravenor annum from such finality until its satisfaction, this interim period
can be held liable for damages.19 The provisions under Title XVIII on being deemed to be by then an equivalent to a forbearance of credit.
"Damages" of the Civil Code govern in determining the measure of
recoverable damages. 20 WHEREFORE, the petition is partly GRANTED. The appealed
decision is AFFIRMED with the MODIFICATION that the legal
II. With regard particularly to an award of interest in the concept of interest to be paid is SIX PERCENT (6%) on the amount due
actual and compensatory damages, the rate of interest, as well as the computed from the decision, dated
accrual thereof, is imposed, as follows: 03 February 1988, of the court a quo. A TWELVE PERCENT (12%)
interest, in lieu of SIX PERCENT (6%), shall be imposed on such
1. When the obligation is breached, and it consists in the payment of amount upon finality of this decision until the payment thereof.
a sum of money, i.e., a loan or forbearance of money, the interest due
should be that which may have been stipulated in SO ORDERED.
writing.21 Furthermore, the interest due shall itself earn legal interest
from the time it is judicially demanded.22 In the absence of stipulation,
the rate of interest shall be 12% per annum to be computed from
default, i.e., from judicial or extrajudicial demand under and subject
to the provisions of Article 1169 23 of the Civil Code.

2. When an obligation, not constituting a loan or forbearance of

money, is breached, an interest on the amount of damages awarded
may be imposed at the discretion of the court24 at the rate of 6% per
annum.25 No interest, however, shall be adjudged on unliquidated
claims or damages except when or until the demand can be established
with reasonable certainty.26 Accordingly, where the demand is
established with reasonable certainty, the interest shall begin to run
G.R. No. 189871 August 13, 2013 relationship between the parties, and his apparent reluctance to be
reinstated, computed only up to promulgation of this decision as
DARIO NACAR, PETITIONER, follows:
vs.
GALLERY FRAMES AND/OR FELIPE BORDEY, SEPARATION PAY
JR., RESPONDENTS.
Date Hired = August 1990
DECISION
Rate = ₱198/day
PERALTA, J.: Date of Decision = Aug. 18, 1998

This is a petition for review on certiorari assailing the Decision1 dated Length of Service = 8 yrs. & 1 month
September 23, 2008 of the Court of Appeals (CA) in CA-G.R. SP No.
98591, and the Resolution2 dated October 9, 2009 denying petitioner’s ₱198.00 x 26 days x 8 months = ₱41,184.00
motion for reconsideration. BACKWAGES

The factual antecedents are undisputed. Date Dismissed = January 24, 1997

Petitioner Dario Nacar filed a complaint for constructive dismissal Rate per day = ₱196.00
before the Arbitration Branch of the National Labor Relations Date of Decisions = Aug. 18, 1998
Commission (NLRC) against respondents Gallery Frames (GF) and/or
Felipe Bordey, Jr., docketed as NLRC NCR Case No. 01-00519-97. a) 1/24/97 to 2/5/98 = 12.36 mos.

On October 15, 1998, the Labor Arbiter rendered a Decision3 in favor ₱196.00/day x 12.36 mos. = ₱62,986.56
of petitioner and found that he was dismissed from employment b) 2/6/98 to 8/18/98 = 6.4 months
without a valid or just cause. Thus, petitioner was awarded backwages
and separation pay in lieu of reinstatement in the amount of Prevailing Rate per day = ₱62,986.00
₱158,919.92. The dispositive portion of the decision, reads:
₱198.00 x 26 days x 6.4 mos. = ₱32,947.20
With the foregoing, we find and so rule that respondents failed to TOTAL = ₱95.933.76
discharge the burden of showing that complainant was dismissed from
employment for a just or valid cause. All the more, it is clear from the
records that complainant was never afforded due process before he xxxx
was terminated. As such, we are perforce constrained to grant
complainant’s prayer for the payments of separation pay in lieu of
reinstatement to his former position, considering the strained
WHEREFORE, premises considered, judgment is hereby rendered On November 5, 2002, petitioner filed a Motion for Correct
finding respondents guilty of constructive dismissal and are therefore, Computation, praying that his backwages be computed from the date
ordered: of his dismissal on January 24, 1997 up to the finality of the Resolution
of the Supreme Court on May 27, 2002.11 Upon recomputation, the
To pay jointly and severally the complainant the amount of sixty-two Computation and Examination Unit of the NLRC arrived at an updated
thousand nine hundred eighty-six pesos and 56/100 (₱62,986.56) amount in the sum of ₱471,320.31.12
Pesos representing his separation pay;
On December 2, 2002, a Writ of Execution13 was issued by the Labor
To pay jointly and severally the complainant the amount of nine (sic) Arbiter ordering the Sheriff to collect from respondents the total
five thousand nine hundred thirty-three and 36/100 (₱95,933.36) amount of ₱471,320.31. Respondents filed a Motion to Quash Writ of
representing his backwages; and Execution, arguing, among other things, that since the Labor Arbiter
awarded separation pay of ₱62,986.56 and limited backwages of
All other claims are hereby dismissed for lack of merit. ₱95,933.36, no more recomputation is required to be made of the said
awards. They claimed that after the decision becomes final and
SO ORDERED.4 executory, the same cannot be altered or amended anymore.14 On
January 13, 2003, the Labor Arbiter issued an Order 15 denying the
Respondents appealed to the NLRC, but it was dismissed for lack of motion. Thus, an Alias Writ of Execution16 was issued on January 14,
merit in the Resolution5 dated February 29, 2000. Accordingly, the 2003.
NLRC sustained the decision of the Labor Arbiter. Respondents filed
a motion for reconsideration, but it was denied. 6 Respondents again appealed before the NLRC, which on June 30,
2003 issued a Resolution17 granting the appeal in favor of the
Dissatisfied, respondents filed a Petition for Review on Certiorari respondents and ordered the recomputation of the judgment award.
before the CA. On August 24, 2000, the CA issued a Resolution
dismissing the petition. Respondents filed a Motion for On August 20, 2003, an Entry of Judgment was issued declaring the
Reconsideration, but it was likewise denied in a Resolution dated May Resolution of the NLRC to be final and executory. Consequently,
8, 2001.7 another pre-execution conference was held, but respondents failed to
appear on time. Meanwhile, petitioner moved that an Alias Writ of
Respondents then sought relief before the Supreme Court, docketed as Execution be issued to enforce the earlier recomputed judgment award
G.R. No. 151332. Finding no reversible error on the part of the CA, in the sum of ₱471,320.31.18
this Court denied the petition in the Resolution dated April 17, 2002. 8
The records of the case were again forwarded to the Computation and
Examination Unit for recomputation, where the judgment award of
An Entry of Judgment was later issued certifying that the resolution
became final and executory on May 27, 2002. 9 The case was, petitioner was reassessed to be in the total amount of only
thereafter, referred back to the Labor Arbiter. A pre-execution ₱147,560.19.
conference was consequently scheduled, but respondents failed to
appear.10
Petitioner then moved that a writ of execution be issued ordering enforce the said judgment. Consequently, it can no longer be modified
respondents to pay him the original amount as determined by the in any respect, except to correct clerical errors or mistakes.
Labor Arbiter in his Decision dated October 15, 1998, pending the
final computation of his backwages and separation pay. Petitioner filed a Motion for Reconsideration, but it was denied in the
Resolution25 dated October 9, 2009.
On January 14, 2003, the Labor Arbiter issued an Alias Writ of
Execution to satisfy the judgment award that was due to petitioner in Hence, the petition assigning the lone error:
the amount of ₱147,560.19, which petitioner eventually received.
I
Petitioner then filed a Manifestation and Motion praying for the re-
computation of the monetary award to include the appropriate WITH DUE RESPECT, THE HONORABLE COURT OF APPEALS
interests.19 SERIOUSLY ERRED, COMMITTED GRAVE ABUSE OF
DISCRETION AND DECIDED CONTRARY TO LAW IN
On May 10, 2005, the Labor Arbiter issued an Order 20 granting the UPHOLDING THE QUESTIONED RESOLUTIONS OF THE
motion, but only up to the amount of ₱11,459.73. The Labor Arbiter NLRC WHICH, IN TURN, SUSTAINED THE MAY 10, 2005
reasoned that it is the October 15, 1998 Decision that should be ORDER OF LABOR ARBITER MAGAT MAKING THE
enforced considering that it was the one that became final and DISPOSITIVE PORTION OF THE OCTOBER 15, 1998 DECISION
executory. However, the Labor Arbiter reasoned that since the OF LABOR ARBITER LUSTRIA SUBSERVIENT TO AN
decision states that the separation pay and backwages are computed OPINION EXPRESSED IN THE BODY OF THE SAME
only up to the promulgation of the said decision, it is the amount of DECISION.26
₱158,919.92 that should be executed. Thus, since petitioner already
received ₱147,560.19, he is only entitled to the balance of ₱11,459.73. Petitioner argues that notwithstanding the fact that there was a
computation of backwages in the Labor Arbiter’s decision, the same
Petitioner then appealed before the NLRC,21 which appeal was denied is not final until reinstatement is made or until finality of the decision,
by the NLRC in its Resolution22 dated September 27, 2006. Petitioner in case of an award of separation pay. Petitioner maintains that
filed a Motion for Reconsideration, but it was likewise denied in the considering that the October 15, 1998 decision of the Labor Arbiter
Resolution23 dated January 31, 2007. did not become final and executory until the April 17, 2002 Resolution
of the Supreme Court in G.R. No. 151332 was entered in the Book of
Aggrieved, petitioner then sought recourse before the CA, docketed as Entries on May 27, 2002, the reckoning point for the computation of
CA-G.R. SP No. 98591. the backwages and separation pay should be on May 27, 2002 and not
when the decision of the Labor Arbiter was rendered on October 15,
On September 23, 2008, the CA rendered a Decision24 denying the 1998. Further, petitioner posits that he is also entitled to the payment
petition. The CA opined that since petitioner no longer appealed the of interest from the finality of the decision until full payment by the
October 15, 1998 Decision of the Labor Arbiter, which already respondents.
became final and executory, a belated correction thereof is no longer
allowed. The CA stated that there is nothing left to be done except to
On their part, respondents assert that since only separation pay and payment because it continued with the litigation until final judgment
limited backwages were awarded to petitioner by the October 15, 1998 at the CA level.
decision of the Labor Arbiter, no more recomputation is required to be
made of said awards. Respondents insist that since the decision clearly A source of misunderstanding in implementing the final decision in
stated that the separation pay and backwages are "computed only up this case proceeds from the way the original labor arbiter framed his
to [the] promulgation of this decision," and considering that petitioner decision. The decision consists essentially of two parts.
no longer appealed the decision, petitioner is only entitled to the award
as computed by the Labor Arbiter in the total amount of ₱158,919.92. The first is that part of the decision that cannot now be disputed
Respondents added that it was only during the execution proceedings because it has been confirmed with finality. This is the finding of the
that the petitioner questioned the award, long after the decision had illegality of the dismissal and the awards of separation pay in lieu of
become final and executory. Respondents contend that to allow the reinstatement, backwages, attorney's fees, and legal interests.
further recomputation of the backwages to be awarded to petitioner at
this point of the proceedings would substantially vary the decision of The second part is the computation of the awards made. On its face,
the Labor Arbiter as it violates the rule on immutability of judgments. the computation the labor arbiter made shows that it was time-bound
as can be seen from the figures used in the computation. This part,
The petition is meritorious. being merely a computation of what the first part of the decision
established and declared, can, by its nature, be re-computed. This is
The instant case is similar to the case of Session Delights Ice Cream the part, too, that the petitioner now posits should no longer be re-
and Fast Foods v. Court of Appeals (Sixth Division),27 wherein the computed because the computation is already in the labor arbiter's
issue submitted to the Court for resolution was the propriety of the decision that the CA had affirmed. The public and private respondents,
computation of the awards made, and whether this violated the on the other hand, posit that a re-computation is necessary because the
principle of immutability of judgment. Like in the present case, it was relief in an illegal dismissal decision goes all the way up to
a distinct feature of the judgment of the Labor Arbiter in the above- reinstatement if reinstatement is to be made, or up to the finality of the
cited case that the decision already provided for the computation of decision, if separation pay is to be given in lieu reinstatement.
the payable separation pay and backwages due and did not further
order the computation of the monetary awards up to the time of the That the labor arbiter's decision, at the same time that it found that an
finality of the judgment. Also in Session Delights, the dismissed illegal dismissal had taken place, also made a computation of the
employee failed to appeal the decision of the labor arbiter. The Court award, is understandable in light of Section 3, Rule VIII of the then
clarified, thus: NLRC Rules of Procedure which requires that a computation be made.
This Section in part states:
In concrete terms, the question is whether a re-computation in the
course of execution of the labor arbiter's original computation of the [T]he Labor Arbiter of origin, in cases involving monetary awards and
awards made, pegged as of the time the decision was rendered and at all events, as far as practicable, shall embody in any such decision
confirmed with modification by a final CA decision, is legally proper. or order the detailed and full amount awarded.
The question is posed, given that the petitioner did not immediately
pay the awards stated in the original labor arbiter's decision; it delayed
Clearly implied from this original computation is its currency up to We see no error in the CA decision confirming that a re-computation
the finality of the labor arbiter's decision. As we noted above, this is necessary as it essentially considered the labor arbiter's original
implication is apparent from the terms of the computation itself, and decision in accordance with its basic component parts as we discussed
no question would have arisen had the parties terminated the case and above. To reiterate, the first part contains the finding of illegality and
implemented the decision at that point. its monetary consequences; the second part is the computation of the
awards or monetary consequences of the illegal dismissal, computed
However, the petitioner disagreed with the labor arbiter's findings on as of the time of the labor arbiter's original decision. 28
all counts - i.e., on the finding of illegality as well as on all the
consequent awards made. Hence, the petitioner appealed the case to Consequently, from the above disquisitions, under the terms of the
the NLRC which, in turn, affirmed the labor arbiter's decision. By law, decision which is sought to be executed by the petitioner, no essential
the NLRC decision is final, reviewable only by the CA on change is made by a recomputation as this step is a necessary
jurisdictional grounds. consequence that flows from the nature of the illegality of dismissal
declared by the Labor Arbiter in that decision. 29 A recomputation (or
The petitioner appropriately sought to nullify the NLRC decision on an original computation, if no previous computation has been made)
jurisdictional grounds through a timely filed Rule 65 petition for is a part of the law – specifically, Article 279 of the Labor Code and
certiorari. The CA decision, finding that NLRC exceeded its authority the established jurisprudence on this provision – that is read into the
in affirming the payment of 13th month pay and indemnity, lapsed to decision. By the nature of an illegal dismissal case, the reliefs continue
finality and was subsequently returned to the labor arbiter of origin for to add up until full satisfaction, as expressed under Article 279 of the
execution. Labor Code. The recomputation of the consequences of illegal
dismissal upon execution of the decision does not constitute an
It was at this point that the present case arose. Focusing on the core alteration or amendment of the final decision being implemented. The
illegal dismissal portion of the original labor arbiter's decision, the illegal dismissal ruling stands; only the computation of monetary
implementing labor arbiter ordered the award re-computed; he consequences of this dismissal is affected, and this is not a violation
apparently read the figures originally ordered to be paid to be the of the principle of immutability of final judgments. 30
computation due had the case been terminated and implemented at the
labor arbiter's level. Thus, the labor arbiter re-computed the award to That the amount respondents shall now pay has greatly increased is a
include the separation pay and the backwages due up to the finality of consequence that it cannot avoid as it is the risk that it ran when it
the CA decision that fully terminated the case on the merits. continued to seek recourses against the Labor Arbiter's decision.
Unfortunately, the labor arbiter's approved computation went beyond Article 279 provides for the consequences of illegal dismissal in no
the finality of the CA decision (July 29, 2003) and included as well uncertain terms, qualified only by jurisprudence in its interpretation of
the payment for awards the final CA decision had deleted - when separation pay in lieu of reinstatement is allowed. When that
specifically, the proportionate 13th month pay and the indemnity happens, the finality of the illegal dismissal decision becomes the
awards. Hence, the CA issued the decision now questioned in the reckoning point instead of the reinstatement that the law decrees. In
present petition. allowing separation pay, the final decision effectively declares that the
employment relationship ended so that separation pay and backwages
are to be computed up to that point.31
Finally, anent the payment of legal interest. In the landmark case of 3. When the judgment of the court awarding a sum of money
Eastern Shipping Lines, Inc. v. Court of Appeals, 32 the Court laid becomes final and executory, the rate of legal interest,
down the guidelines regarding the manner of computing legal interest, whether the case falls under paragraph 1 or paragraph 2,
to wit: above, shall be 12% per annum from such finality until its
satisfaction, this interim period being deemed to be by then an
II. With regard particularly to an award of interest in the concept of equivalent to a forbearance of credit.33
actual and compensatory damages, the rate of interest, as well as the
accrual thereof, is imposed, as follows: Recently, however, the Bangko Sentral ng Pilipinas Monetary Board
(BSP-MB), in its Resolution No. 796 dated May 16, 2013, approved
1. When the obligation is breached, and it consists in the the amendment of Section 234 of Circular No. 905, Series of 1982 and,
payment of a sum of money, i.e., a loan or forbearance of accordingly, issued Circular No. 799,35 Series of 2013, effective July
money, the interest due should be that which may have been 1, 2013, the pertinent portion of which reads:
stipulated in writing. Furthermore, the interest due shall itself
earn legal interest from the time it is judicially demanded. In The Monetary Board, in its Resolution No. 796 dated 16 May 2013,
the absence of stipulation, the rate of interest shall be 12% per approved the following revisions governing the rate of interest in the
annum to be computed from default, i.e., from judicial or absence of stipulation in loan contracts, thereby amending Section 2
extrajudicial demand under and subject to the provisions of of Circular No. 905, Series of 1982:
Article 1169 of the Civil Code.
Section 1. The rate of interest for the loan or forbearance of any
2. When an obligation, not constituting a loan or forbearance money, goods or credits and the rate allowed in judgments, in the
of money, is breached, an interest on the amount of damages absence of an express contract as to such rate of interest, shall be six
awarded may be imposed at the discretion of the court at the percent (6%) per annum.
rate of 6% per annum. No interest, however, shall be adjudged
on unliquidated claims or damages except when or until the Section 2. In view of the above, Subsection X305.136 of the Manual of
demand can be established with reasonable certainty. Regulations for Banks and Sections 4305Q.1, 37 4305S.338 and
Accordingly, where the demand is established with 4303P.139 of the Manual of Regulations for Non-Bank Financial
reasonable certainty, the interest shall begin to run from the Institutions are hereby amended accordingly.
time the claim is made judicially or extrajudicially (Art. 1169,
Civil Code) but when such certainty cannot be so reasonably This Circular shall take effect on 1 July 2013.
established at the time the demand is made, the interest shall
begin to run only from the date the judgment of the court is Thus, from the foregoing, in the absence of an express stipulation as
made (at which time the quantification of damages may be to the rate of interest that would govern the parties, the rate of legal
deemed to have been reasonably ascertained). The actual base interest for loans or forbearance of any money, goods or credits and
for the computation of legal interest shall, in any case, be on the rate allowed in judgments shall no longer be twelve percent (12%)
the amount finally adjudged. per annum - as reflected in the case of Eastern Shipping Lines40 and
Subsection X305.1 of the Manual of Regulations for Banks and
Sections 4305Q.1, 4305S.3 and 4303P.1 of the Manual of Regulations provisions under Title XVIII on "Damages" of the Civil Code
for Non-Bank Financial Institutions, before its amendment by BSP- govern in determining the measure of recoverable damages.
MB Circular No. 799 - but will now be six percent (6%) per annum
effective July 1, 2013. It should be noted, nonetheless, that the new II. With regard particularly to an award of interest in the
rate could only be applied prospectively and not retroactively. concept of actual and compensatory damages, the rate of
Consequently, the twelve percent (12%) per annum legal interest shall interest, as well as the accrual thereof, is imposed, as follows:
apply only until June 30, 2013. Come July 1, 2013 the new rate of six
percent (6%) per annum shall be the prevailing rate of interest when When the obligation is breached, and it consists in the payment of a
applicable. sum of money, i.e., a loan or forbearance of money, the interest due
should be that which may have been stipulated in writing.
Corollarily, in the recent case of Advocates for Truth in Lending, Inc. Furthermore, the interest due shall itself earn legal interest from the
and Eduardo B. Olaguer v. Bangko Sentral Monetary Board, 41 this time it is judicially demanded. In the absence of stipulation, the rate
Court affirmed the authority of the BSP-MB to set interest rates and of interest shall be 6% per annum to be computed from default, i.e.,
to issue and enforce Circulars when it ruled that "the BSP-MB may from judicial or extrajudicial demand under and subject to the
prescribe the maximum rate or rates of interest for all loans or provisions of Article 1169 of the Civil Code.
renewals thereof or the forbearance of any money, goods or credits,
including those for loans of low priority such as consumer loans, as When an obligation, not constituting a loan or forbearance of money,
well as such loans made by pawnshops, finance companies and similar is breached, an interest on the amount of damages awarded may be
credit institutions. It even authorizes the BSP-MB to prescribe imposed at the discretion of the court at the rate of 6% per annum. No
different maximum rate or rates for different types of borrowings, interest, however, shall be adjudged on unliquidated claims or
including deposits and deposit substitutes, or loans of financial damages, except when or until the demand can be established with
intermediaries." reasonable certainty. Accordingly, where the demand is established
with reasonable certainty, the interest shall begin to run from the time
Nonetheless, with regard to those judgments that have become final the claim is made judicially or extrajudicially (Art. 1169, Civil Code),
and executory prior to July 1, 2013, said judgments shall not be but when such certainty cannot be so reasonably established at the
disturbed and shall continue to be implemented applying the rate of time the demand is made, the interest shall begin to run only from the
interest fixed therein. date the judgment of the court is made (at which time the
quantification of damages may be deemed to have been reasonably
To recapitulate and for future guidance, the guidelines laid down in ascertained). The actual base for the computation of legal interest
the case of Eastern Shipping Lines42 are accordingly modified to shall, in any case, be on the amount finally adjudged.
embody BSP-MB Circular No. 799, as follows:
When the judgment of the court awarding a sum of money becomes
I. When an obligation, regardless of its source, i.e., law, final and executory, the rate of legal interest, whether the case falls
contracts, quasi-contracts, delicts or quasi-delicts is breached, under paragraph 1 or paragraph 2, above, shall be 6% per annum from
the contravenor can be held liable for damages. The such finality until its satisfaction, this interim period being deemed to
be by then an equivalent to a forbearance of credit.
And, in addition to the above, judgments that have become final and
executory prior to July 1, 2013, shall not be disturbed and shall
continue to be implemented applying the rate of interest fixed therein.

WHEREFORE, premises considered, the Decision dated September

23, 2008 of the Court of Appeals in CA-G.R. SP No. 98591, and the
Resolution dated October 9, 2009 are REVERSED and SET ASIDE.
Respondents are Ordered to Pay petitioner:

(1) backwages computed from the time petitioner was

illegally dismissed on January 24, 1997 up to May 27, 2002,
when the Resolution of this Court in G.R. No. 151332 became
final and executory;

(2) separation pay computed from August 1990 up to May 27,

2002 at the rate of one month pay per year of service; and

(3) interest of twelve percent (12%) per annum of the total

monetary awards, computed from May 27, 2002 to June 30,
2013 and six percent (6%) per annum from July 1, 2013 until
their full satisfaction.

The Labor Arbiter is hereby ORDERED to make another

recomputation of the total monetary benefits awarded and due to
petitioner in accordance with this Decision.

SO ORDERED.
G.R. No. 175139 April 18, 2012 On October 3, 1993, petitioner Hermojina Estores and respondent-
spouses Arturo and Laura Supangan entered into a Conditional Deed
HERMOJINA ESTORES, Petitioner, of Sale5 whereby petitioner offered to sell, and respondent-spouses
vs. offered to buy, a parcel of land covered by Transfer Certificate of Title
SPOUSES ARTURO and LAURA SUPANGAN, Respondents. No. TCT No. 98720 located at Naic, Cavite for the sum of ₱4.7
million. The parties likewise stipulated, among others, to wit:
DECISION
xxxx
DEL CASTILLO, J.:
1. Vendor will secure approved clearance from DAR
The only issue posed before us is the propriety of the imposition of requirements of which are (sic):
interest and attorney’s fees.
a) Letter request
1
Assailed in this Petition for Review filed under Rule 45 of the Rules
of Court is the May 12, 2006 Decision2 of the Court of Appeals (CA) b) Title
in CA-G.R. CV No. 83123, the dispositive portion of which reads:
c) Tax Declaration
WHEREFORE, the appealed decision is MODIFIED. The rate of
interest shall be six percent (6%) per annum, computed from d) Affidavit of Aggregate Landholding –
September 27, 2000 until its full payment before finality of the Vendor/Vendee
judgment. If the adjudged principal and the interest (or any part
thereof) remain unpaid thereafter, the interest rate shall be adjusted to e) Certification from the Prov’l. Assessor’s as to
twelve percent (12%) per annum, computed from the time the Landholdings of Vendor/Vendee
judgment becomes final and executory until it is fully satisfied. The
award of attorney’s fees is hereby reduced to ₱100,000.00. Costs f) Affidavit of Non-Tenancy
against the defendants-appellants.
g) Deed of Absolute Sale
SO ORDERED.3
xxxx
Also assailed is the August 31, 2006 Resolution4 denying the motion
for reconsideration. 4. Vendee shall be informed as to the status of DAR clearance
within 10 days upon signing of the documents.
Factual Antecedents
xxxx
 6. Regarding the house located within the perimeter of the interest of 12% compounded annually shall be imposed on the ₱3.5
subject [lot] owned by spouses [Magbago], said house shall million.9 When petitioner still failed to return the amount despite
be moved outside the perimeter of this subject property to the demand, respondent-spouses were constrained to file a Complaint10 for
300 sq. m. area allocated for [it]. Vendor hereby accepts the sum of money before the Regional Trial Court (RTC) of Malabon
responsibility of seeing to it that such agreement is carried out against herein petitioner as well as Roberto U. Arias (Arias) who
before full payment of the sale is made by vendee. allegedly acted as petitioner’s agent. The case was docketed as Civil
Case No. 3201-MN and raffled off to Branch 170. In their complaint,
7. If and after the vendor has completed all necessary respondent-spouses prayed that petitioner and Arias be ordered to:
documents for registration of the title and the vendee fails to
complete payment as per agreement, a forfeiture fee of 25% 1. Pay the principal amount of ₱3,500,000.00 plus interest of
or downpayment, shall be applied. However, if the vendor 12% compounded annually starting October 1, 1993 or an
fails to complete necessary documents within thirty days estimated amount of ₱8,558,591.65;
without any sufficient reason, or without informing the
vendee of its status, vendee has the right to demand return of 2. Pay the following items of damages:
full amount of down payment.
a) Moral damages in the amount of ₱100,000.00;
xxxx
b) Actual damages in the amount of ₱100,000.00;
9. As to the boundaries and partition of the lots (15,018 sq. m.
and 300 sq. m.) Vendee shall be informed immediately of its c) Exemplary damages in the amount of ₱100,000.00;
approval by the LRC.
d) [Attorney’s] fee in the amount of ₱50,000.00 plus
10. The vendor assures the vendee of a peaceful transfer of 20% of recoverable amount from the [petitioner].
ownership.
e) [C]ost of suit.11
6
xxxx
In their Answer with Counterclaim, 12 petitioner and Arias averred that
After almost seven years from the time of the execution of the contract they are willing to return the principal amount of ₱3.5 million but
and notwithstanding payment of ₱3.5 million on the part of without any interest as the same was not agreed upon. In their Pre-
respondent-spouses, petitioner still failed to comply with her Trial Brief,13 they reiterated that the only remaining issue between the
obligation as expressly provided in paragraphs 4, 6, 7, 9 and 10 of the parties is the imposition of interest. They argued that since the
contract. Hence, in a letter 7 dated September 27, 2000, respondent- Conditional Deed of Sale provided only for the return of the
spouses demanded the return of the amount of ₱3.5 million within 15 downpayment in case of breach, they cannot be held liable to pay legal
days from receipt of the letter. In reply, 8 petitioner acknowledged interest as well.14
receipt of the ₱3.5 million and promised to return the same within 120
days. Respondent-spouses were amenable to the proposal provided an
In its Pre-Trial Order15 dated June 29, 2001, the RTC noted that "the SO ORDERED.22
parties agreed that the principal amount of 3.5 million pesos should be
returned to the [respondent-spouses] by the [petitioner] and the issue Ruling of the Court of Appeals
remaining [is] whether x x x [respondent-spouses] are entitled to legal
interest thereon, damages and attorney’s fees."16 Aggrieved, petitioner and Arias filed their notice of appeal.23 The CA
noted that the only issue submitted for its resolution is "whether it is
Trial ensued thereafter. After the presentation of the respondent- proper to impose interest for an obligation that does not involve a loan
spouses’ evidence, the trial court set the presentation of Arias and or forbearance of money in the absence of stipulation of the parties." 24
petitioner’s evidence on September 3, 2003.17 However, despite
several postponements, petitioner and Arias failed to appear hence On May 12, 2006, the CA rendered the assailed Decision affirming
they were deemed to have waived the presentation of their evidence. the ruling of the RTC finding the imposition of 6% interest
Consequently, the case was deemed submitted for decision.18 proper.25 However, the same shall start to run only from September 27,
2000 when respondent-spouses formally demanded the return of their
Ruling of the Regional Trial Court money and not from October 1993 when the contract was executed as
held by the RTC. The CA also modified the RTC’s ruling as regards
On May 7, 2004, the RTC rendered its Decision19 finding respondent- the liability of Arias. It held that Arias could not be held solidarily
spouses entitled to interest but only at the rate of 6% per annum and liable with petitioner because he merely acted as agent of the latter.
not 12% as prayed by them. 20 It also found respondent-spouses entitled Moreover, there was no showing that he expressly bound himself to
to attorney’s fees as they were compelled to litigate to protect their be personally liable or that he exceeded the limits of his authority.
interest.21 More importantly, there was even no showing that Arias was
authorized to act as agent of petitioner.26 Anent the award of attorney’s
The dispositive portion of the RTC Decision reads: fees, the CA found the award by the trial court (₱50,000.00 plus 20%
of the recoverable amount) excessive27 and thus reduced the same to
WHEREFORE, premises considered, judgment is hereby rendered in ₱100,000.00.28
favor of the [respondent-spouses] and ordering the [petitioner and
Roberto Arias] to jointly and severally: The dispositive portion of the CA Decision reads:

1. Pay [respondent-spouses] the principal amount of Three Million WHEREFORE, the appealed decision is MODIFIED. The rate of
Five Hundred Thousand pesos (₱3,500,000.00) with an interest of 6% interest shall be six percent (6%) per annum, computed from
compounded annually starting October 1, 1993 and attorney’s fee in September 27, 2000 until its full payment before finality of the
the amount of Fifty Thousand pesos (₱50,000.00) plus 20% of the judgment. If the adjudged principal and the interest (or any part
recoverable amount from the defendants and cost of the suit. thereof) remain[s] unpaid thereafter, the interest rate shall be adjusted
to twelve percent (12%) per annum, computed from the time the
The Compulsory Counter Claim is hereby dismissed for lack of factual judgment becomes final and executory until it is fully satisfied. The
evidence. award of attorney’s fees is hereby reduced to ₱100,000.00. Costs
against the [petitioner].
SO ORDERED.29 Interest may be imposed even in the absence of stipulation in the
contract.
Petitioner moved for reconsideration which was denied in the August
31, 2006 Resolution of the CA. We sustain the ruling of both the RTC and the CA that it is proper to
impose interest notwithstanding the absence of stipulation in the
Hence, this petition raising the sole issue of whether the imposition of contract. Article 2210 of the Civil Code expressly provides that
interest and attorney’s fees is proper. "[i]nterest may, in the discretion of the court, be allowed upon
damages awarded for breach of contract." In this case, there is no
Petitioner’s Arguments question that petitioner is legally obligated to return the ₱3.5 million
because of her failure to fulfill the obligation under the Conditional
Petitioner insists that she is not bound to pay interest on the ₱3.5 Deed of Sale, despite demand. She has in fact admitted that the
million because the Conditional Deed of Sale only provided for the conditions were not fulfilled and that she was willing to return the full
return of the downpayment in case of failure to comply with her amount of ₱3.5 million but has not actually done so. Petitioner enjoyed
obligations. Petitioner also argues that the award of attorney’s fees in the use of the money from the time it was given to her 30 until now.
favor of the respondent-spouses is unwarranted because it cannot be Thus, she is already in default of her obligation from the date of
said that the latter won over the former since the CA even sustained demand, i.e., on September 27, 2000.
her contention that the imposition of 12% interest compounded
annually is totally uncalled for. The interest at the rate of 12% is applicable in the instant case.

Respondent-spouses’ Arguments Anent the interest rate, the general rule is that the applicable rate of
interest "shall be computed in accordance with the stipulation of the
Respondent-spouses aver that it is only fair that interest be imposed parties."31 Absent any stipulation, the applicable rate of interest shall
on the amount they paid considering that petitioner failed to return the be 12% per annum "when the obligation arises out of a loan or a
amount upon demand and had been using the ₱3.5 million for her forbearance of money, goods or credits. In other cases, it shall be six
benefit. Moreover, it is undisputed that petitioner failed to perform her percent (6%)."32 In this case, the parties did not stipulate as to the
obligations to relocate the house outside the perimeter of the subject applicable rate of interest. The only question remaining therefore is
property and to complete the necessary documents. As regards the whether the 6% as provided under Article 2209 of the Civil Code, or
attorney’s fees, they claim that they are entitled to the same because 12% under Central Bank Circular No. 416, is due.
they were forced to litigate when petitioner unjustly withheld the
amount. Besides, the amount awarded by the CA is even smaller The contract involved in this case is admittedly not a loan but a
compared to the filing fees they paid. Conditional Deed of Sale. However, the contract provides that the
seller (petitioner) must return the payment made by the buyer
Our Ruling (respondent-spouses) if the conditions are not fulfilled. There is no
question that they have in fact, not been fulfilled as the seller
(petitioner) has admitted this. Notwithstanding demand by the buyer
The petition lacks merit.
(respondent-spouses), the seller (petitioner) has failed to return the Petitioner’s unwarranted withholding of the money which rightfully
money and pertains to respondent-spouses amounts to forbearance of money
which can be considered as an involuntary loan. Thus, the applicable
should be considered in default from the time that demand was made rate of interest is 12% per annum. In Eastern Shipping Lines, Inc. v.
on September 27, 2000. Court of Appeals,35 cited in Crismina Garments, Inc. v. Court of
Appeals,36 the Court suggested the following guidelines:
Even if the transaction involved a Conditional Deed of Sale, can the
stipulation governing the return of the money be considered as a I. When an obligation, regardless of its source, i.e., law,
forbearance of money which required payment of interest at the rate contracts, quasi-contracts, delicts or quasi-delicts is breached,
of 12%? We believe so. the contravenor can be held liable for damages. The
provisions under Title XVIII on ‘Damages’ of the Civil Code
In Crismina Garments, Inc. v. Court of Appeals,33 "forbearance" was govern in determining the measure of recoverable damages.
defined as a "contractual obligation of lender or creditor to refrain
during a given period of time, from requiring the borrower or debtor II. With regard particularly to an award of interest in the
to repay a loan or debt then due and payable." This definition describes concept of actual and compensatory damages, the rate of
a loan where a debtor is given a period within which to pay a loan or interest, as well as the accrual thereof, is imposed, as follows:
debt. In such case, "forbearance of money, goods or credits" will have
no distinct definition from a loan. We believe however, that the phrase 1. When the obligation is breached, and it consists in
"forbearance of money, goods or credits" is meant to have a separate the payment of a sum of money, i.e., a loan or
meaning from a loan, otherwise there would have been no need to add forbearance of money, the interest due should be that
that phrase as a loan is already sufficiently defined in the Civil which may have been stipulated in writing.
Code. 34 Forbearance of money, goods or credits should therefore refer Furthermore, the interest due shall itself earn legal
to arrangements other than loan agreements, where a person interest from the time it is judicially demanded. In the
acquiesces to the temporary use of his money, goods or credits absence of stipulation, the rate of interest shall be
pending happening of certain events or fulfillment of certain 12% per annum to be computed from default, i.e.,
conditions. In this case, the respondent-spouses parted with their from judicial or extrajudicial demand under and
money even before the conditions were fulfilled. They have therefore subject to the provisions of Article 1169 of the Civil
allowed or granted forbearance to the seller (petitioner) to use their Code.
money pending fulfillment of the conditions. They were deprived of
the use of their money for the period pending fulfillment of the 2. When an obligation, not constituting a loan or
conditions and when those conditions were breached, they are entitled forbearance of money, is breached, an interest on the
not only to the return of the principal amount paid, but also to amount of damages awarded may be imposed at the
compensation for the use of their money. And the compensation for discretion of the court at the rate of 6% per annum.
the use of their money, absent any stipulation, should be the same rate No interest, however, shall be adjudged on
of legal interest applicable to a loan since the use or deprivation of unliquidated claims or damages except when or until
funds is similar to a loan. the demand can be established with reasonable
 certainty. Accordingly, where the demand is Under Article 2208 of the Civil Code, attorney’s fees may be
established with reasonable certainty, the interest recovered:
shall begin to run from the time the claim is made
judicially or extrajudicially (Art. 1169, Civil Code) xxxx
but when such certainty cannot be so reasonably
established at the time the demand is made, the (2) When the defendant’s act or omission has compelled the
interest shall begin to run only from the date the plaintiff to litigate with third persons or to incur expenses to
judgment of the court is made (at which time the protect his interest;
quantification of damages may be deemed to have
been reasonably ascertained). The actual base for the xxxx
computation of legal interest shall, in any case, be on
the amount finally adjudged. (11) In any other case where the court deems it just and
equitable that attorney’s fees and expenses of litigation should
3. When the judgment of the court awarding a sum of be recovered.
money becomes final and executory, the rate of legal
interest, whether the case falls under paragraph 1 or In all cases, the attorney’s fees and expenses of litigation must be
paragraph 2, above, shall be 12% per annum from
reasonable.
such finality until its satisfaction, this interim period
being deemed to be by then an equivalent to a
Considering the circumstances of the instant case, we find respondent-
forbearance of credit.37
spouses entitled to recover attorney’s fees. There is no doubt that they
were forced to litigate to protect their interest, i.e., to recover their
Eastern Shipping Lines, Inc. v. Court of Appeals38 and its predecessor money. However, we find the amount of ₱50,000.00 more appropriate
case, Reformina v. Tongol39 both involved torts cases and hence, there in line with the policy enunciated in Article 2208 of the Civil Code
was no forbearance of money, goods, or credits. Further, the amount
that the award of attorney’s fees must always be reasonable.
claimed (i.e., damages) could not be established with reasonable
certainty at the time the claim was made. Hence, we arrived at a
WHEREFORE, the Petition for Review is DENIED. The May 12,
different ruling in those cases.
2006 Decision of the Court of Appeals in CA-G.R. CV No. 83123 is
AFFIRMED with MODIFICATIONS that the rate of interest shall be
Since the date of demand which is September 27, 2000 was twelve percent (12%) per annum, computed from September 27, 2000
satisfactorily established during trial, then the interest rate of 12%
until fully satisfied. The award of attorney’s fees is further reduced to
should be reckoned from said date of demand until the principal
₱50,000.00.
amount and the interest thereon is fully satisfied.1âwphi1
SO ORDERED.
The award of attorney’s fees is warranted.
G.R. No. 151339 January 31, 2006 was contained in a Contract of Lease, was to subsist for 15 years
commencing retroactively from 1 October 1983.
EDITHA M. FRANCISCO, Petitioner,
vs. Five (5) years after the execution of the Compromise Agreement and
ROQUE CO and/or MARIANO CO, Respondents. Contract of Lease, the heirs of Baetiong filed a Motion with the
Quezon City, RTC, Branch 101, wherein they alleged that respondents
DECISION were actually occupying a larger portion of their land than the 30,000
square meter limit agreed upon in the Compromise Agreement. They
TINGA, J.: prayed that a commission be constituted for the proper enforcement of
the Compromise Agreement.
The parcel of land that lies at the center of this case is covered by
Transfer Certificate of Title (TCT) No. 44546, issued by the Quezon The RTC granted the motion, but this action was challenged by
City Register of Deeds registered in the name of Pastora Baetiong.1 It respondents by way of a Petition for Certiorari and Prohibition which
has spawned at least three (3) different cases involving the parties, was docketed as CA-G.R. SP. No. 18032. This is the second of the
spanning the course of three (3) decades. Before this Court is the third three (3) cases earlier referred to. In a Decision rendered on 12 July
of the cases, the resolution of which ultimately hearkens back to the 1990, the Court of Appeals reversed the RTC and declared that the
pronouncements made in the first two (2) cases. Appropriately, the judgment by compromise rendered in Civil Case No. Q-38464 "was
main issue before us is the applicability of res judicata. finally terminated and executed".3 The appellate court concluded that
the constitution of a commission for the purpose of delineating the
The legal controversy was first sparked after the death of Pastora bounds of the leased portion of the property would serve no purpose,
Baetiong in 1975 by a complaint for accion publiciana filed against considering that the Compromise Agreement itself mandated that the
the heirs of Baetiong, including petitioner, by respondents Roque Co parties immediately conduct a delineation of the subject property for
and Mariano Co, involving the above-mentioned parcel of land, and proper inclusion in the Contract of Lease. According to the Court of
another property, covered by TCT No. 63531 issued by the Caloocan Appeals, when the Contract of Lease was executed on the same day,
City Register of Deeds. The case was docketed as Civil Case No. Q- the Compromise Agreement was already deemed to have been fully
38464 and assigned to the Quezon City Regional Trial Court (RTC), implemented and duly enforced.4
Branch 101.
The Court of Appeals made several other conclusions which are
The said complaint was settled when the parties entered into a worthy of note. It ruled that since the Contract of Lease specified that
Compromise Agreement dated 10 November 1983, which was duly the leased portion had an area of "approximately" three (3) hectares
approved by the Branch 101.2 In the Compromise Agreement, the (or 30,000 sq.m.), the area occupied by respondents was the same
parties acknowledged the heirs of Baetiong as the owner of the subject property agreed upon for lease by the parties in the Compromise
properties. Further, it was agreed upon that the heirs of Baetiong Agreement. On the claim that the area leased was actually in excess of
would lease to respondents a portion of the properties, totaling 7,659 sq. meters, the Court of Appeals held that the heirs of Baetiong
between 25,000 square meters to 30,000 square meters, covering land were precluded by laches and negligence from asserting such claim,
then already occupied by respondents. The lease agreement, which
as they had remained silent for almost five years in contesting the of Lease expressly delineated the coverage of the lease agreement as
subject area. totaling only three (3) hectares, which according to the MeTC,
excluded Lot No. 2-F-4 of the subdivision plan.8 On the issue of res
In sum, the Court of Appeals set aside the RTC order constituting a judicata, the MeTC and RTC found that res judicata did not apply,
commission, and declared "the judgment by compromise rendered in owing to the absence of the requisite of identity of causes of action.
Civil Case No. Q-38464 as finally terminated and executed." This Both courts noted that the instant action concerned a complaint for
Decision attained finality after the Supreme Court declined to give due forcible entry, while the earlier case pertained to the execution of a
course to a petition for review filed by the heirs of Baetiong, through contract of lease.
a Resolution dated 10 June 1991.
The MeTC ordered the respondents to pay petitioner the amount
Four (4) years later, or on 24 July 1995, petitioner filed a complaint of P500.00 per day beginning 21 July 1995 as reasonable
for forcible entry against respondents before the Metropolitan Trial compensation until the vacation of the property. The RTC likewise
Court (MeTC) of Quezon City, docketed as Civil Case No. 13158. ordered that the case be remanded to the MeTC for immediate
This is the instant case and the third of the cases earlier adverted to. execution, and it appears that the judgment was executed while the
Petitioner alleged therein that she was the owner in fee simple of a case was litigated before the Court of Appeals.
parcel of land, denominated as Lot No. 2-F-4, with an area of 5,679
square meters, encompassed under TCT No. 44546, which she On 17 August 2000, the Court of Appeals Thirteenth Division issued
inherited from her mother per a 1978 Extra-Judicial Settlement of its Decision9 reversing the rulings of the lower courts. The Court of
Estate which caused the subdivision of the property into several lots. Appeals ruled that the complaint for forcible entry was indeed barred
by res judicata. It was held that while there was a difference in the
Petitioner maintained that on 19 July 1995, respondents, through forms of the two actions, there was nonetheless a similarity of causes
agents, entered Lot No. 2-F-4 and started fencing the said property. In of action in the two cases, as the same evidence would support and
their answer, respondents alleged that the property over which establish both the former and present causes of action. It was observed
petitioner was asserting her rights was covered under the Contract of that the evidence to be presented by the contending parties in both
Lease which had been executed pursuant to the earlier Compromise actions was that which would support their allegation of having a
Agreement. Respondents also cast doubt on the validity of the 1978 better right to the possession of the subject property.
Extra-Judicial Settlement of Estate.5 Respondents also pointed out that
assuming petitioner had a cause of action against them, the same was The appellate court expounded that that matter of preference of right
barred by res judicata, particularly the 12 July 1990 Decision of the of petitioners over the property by virtue of the lease contract was
Court of Appeals which had since attained finality. already settled by the Court of Appeals in CA-G.R. SP No. 18032. As
the Contract of Lease was still in effect at the time of the supposed
The MeTC ruled in favor of petitioner in a Decision6 dated 13 forcible entry, petitioner was declared as having no basis in alleging
November 1996, such disposition being subsequently affirmed by the such infraction. Moreover, the Court of Appeals ruled that the
RTC on 31 March 1999.7 The MeTC ruled that petitioner was indeed contention that Lot No. 2-F-4 was not included in the Contract of
the owner and prior possessor of Lot No. 2-F-4, as evidenced by the Lease had also been resolved in CA-G.R. SP. No 18032, particularly
Extra-Judicial Settlement. The MeTC also concluded that the Contract the declarations therein that:
It is very clear that the area now occupied by the lessee petitioners is ratiocinations of the lower courts center on whether there was identity
the property that was actually agreed upon by the lessees-petitioners in the causes of action in the case for execution of the lease contract
and private respondents-lessors as stipulated in said contract of lease.10 and that of forcible entry. If the case hinges on that point alone, it is
easy to force a simplistic reading that a complaint for forcible entry
The Court of Appeals also concluded that due to malicious involves a different cause of action or right-duty correlative from that
prosecution, respondents were liable for moral damages concerning the enforcement of a lease contract, as well as for different
of P30,000.00, exemplary damages of P20,000.00, and attorney’s fees reliefs.
of P20,000.00.
However, the Court of Appeals, in reversing the lower courts, invoked
Hence the present petition. Mendiola v. Court of Appeals,13 which involved the application of the
first kind of res judicata or "bar by prior judgment."14 In particular, the
Petitioner insists that res judicata does not apply in this case, owing to appellate court cited the rule from Mendiola that "[t]he test of identity
the difference between the two causes of actions. Petitioner also of causes of action lies not in the form of an action but on whether the
claims that Lot No. 2-F-4 stands outside the lots covered by the lease same evidence would support and establish the former and present
contract. Petitioner also argues that res judicata could apply only to causes of action."15 Applying this test, it does appear that the present
facts and circumstances as they existed at the time the judgment was ejectment case could be barred by the prior judgment in CA-G.R. SP
rendered. On this point, petitioner points out that four (4) years had No. 18032. The earlier case attempted to establish that respondents
elapsed between the final judgment in CA-G.R. SP No. 18032 and the were entitled to lease not more than three (3) hectares of TCT No.
filing of the instant complaint, which was governed by new facts and 44546. In the present case, petitioner is obliged to establish that
conditions due to the intrusion by respondents into Lot No. 2-F-4. respondent has no legal right to occupy the portion of TCT No. 44546
denominated as Lot No. 2-F-4. It is possible that the same evidence
The central issue obviously concerns the binding force of the decision may be used to establish that petitioners could occupy in excess of
in CA-G.R. SP No. 18032, which respondents claim bars the present three (3) hectares of TCT No. 44546 and they could also occupy Lot
complaint due to res judicata. On this score, the matter would be best No. 2-F-4.
illuminated by pointing out that there are two aspects to the doctrine
of res judicata. The first, known as "bar by prior judgment," is the Still, the Court considers the second facet of res judicata,
effect of a judgment as a bar to the prosecution of a second action upon "conclusiveness of judgment" as controlling in this case.
the same claim, demand or cause of action. The second, known as Conclusiveness of judgment operates as a bar even if there is no
"conclusiveness of judgment," issues actually and directly resolved in identity as between the first and second causes of judgment. Under the
a former suit cannot again be raised in any future case between the doctrine, any right, fact, or matter in issue directly adjudicated or
same parties involving a different cause of action.11 necessarily involved in the determination of an action before a
competent court in which judgment is rendered on the merits is
The lower courts, in considering the question of res judicata, seem to conclusively settled by the judgment therein and cannot again be
have taken into account only the first kind of res judicata, "bar by prior litigated between the parties and their privies whether or not the claim,
judgment," which involves identity of parties, subject matter, and demand, purpose, or subject matter of the two actions is the same. 16
causes of action.12 Indeed, the arguments of the parties, and the
Evidently, "conclusiveness of judgment" may operate to bar the Hence, the constitution of a commission for the purpose of delineating
second case even if there is no identity of causes of action. The the bounds of the property will serve no other purpose.
judgment is conclusive in the second case, only as to those matters
actually and directly controverted and determined, and not as to As regards the contention of the private respondent that the
matters merely involved therein.17 inclusion of the land in the Contract of Lease is in excess of what
was really agreed upon deserves no scant consideration. The fact
In that regard, we now consider the effect of the declarations on remains that the contract of lease specifically stipulates, thus:
several questions of fact and law earlier made by the Court of Appeals
in its Decision in CA-G.R. SP No. 18032, a judgment that has since " . . . certain portions of the above-mentioned parcels of land now
lapsed into finality. The relevant portion of the ruling stated: actually occupied by the LESSEES with the warehouses/buildings
constructed and owned by said LESSEESS, with a road and fences
In the case at bar, the parties in pursuance of the judgment by constructed by them, with an approximate area of Three (3)
compromise, the substantive portion of which reads: hectares more or less which is hereby delineated as per plan,"
(Underscoring supplied).
" . . . d. Area to be leased is that portion actually occupied with
building constructions thereon in possession of defendants, more It is very clear that the area now occupied by the lessees-
specifically bounded by the road with fence. This may be the subject petitioners is the property that was actually agreed upon by the
of an ocular inspection by the parties’./p. 1, Supplemental Pre-Trial lessees-petitioners and private respondents-lessors as stipulated in
Brief of Defendants/ which area be duly delineated by a geodetic said Contract of Lease.
survey immediately to be conducted by a geodetic engineer chosen
mutually by the parties, and in case of disagreement, by a team Granting that the area leased is really in excess of 7,659.84 sq.
composed of three geodetic surveyors/engineers, 1 chosen by meters as claimed by respondents, the same is already precluded
plaintiffs, 1 chosen by defendants, and the third to be from asserting such contention. Records of the case show that
chosen/commissioned by the Court, whose findings shall be final and respondents-lessors by their silence and inaction for almost five
binding between the parties, without right of any appeal, the costs of years in contesting the area subject of the lease constitutes laches
which shall be defrayed by the parties on a 50-50 basis’. that places them in estoppel to assert their alleged right under the
(Underscoring supplied.) compromise agreement. The Motion for Constitution of Commission
to delineate the boundaries of the area subject matter of the lease
executed simultaneously a lease contract, incorporating therein the should have been brought earlier before the execution of the contract
terms and conditions agreed upon. of lease. Failure to assert this fact within a reasonable time warrants a
presumption that the respondents either has abandoned it or declined
The Compromise Agreement speaks for itself. The delineation of to assert it.18
the subject property was immediately to be conducted by both
parties for proper inclusion in the Contract of Lease. Thus, when There are important conclusions drawn from the quoted
the Contract of Lease was executed, the Compromise Agreement pronouncement which are of binding force in this case. First,
have (sic) already been fully implemented and duly enforced. the Compromise Agreement, which provided that the leased area be
delineated by a geodetic survey instituted by both parties, was already Lessors and Mariano and Roque Co, as Lessees, the same covers only
deemed as fully implemented and enforced through the simultaneous portions of the parcels of land being actually occupied by the
execution of the Contract of Lease. Second, the Contract of Lease defendants with the warehouses/buildings/fences constructed thereon
established that the area covered by the agreement constituted those by them at that time with an area of three (3) hectares or 30,000 sq.
portions of TCT No. 44546 then occupied by respondents, which as meters. As shown by the subdivision plan, the said area covers only
approximated as more or less three (3) hectares in area. Third, Lots 2-E, 2-F-1 and 2-F-2, with a total area of 31,624 sq. meters.
assuming that the area actually leased to respondents exceeded the Hence, the intrusion of the defendants into Lot 2-F-4 with an area of
stipulated three (3) hectares by 7,659.84 sq. meters (or .76 hectares), 5,679 sq. meters, which is not covered by the said lease contract,
the heirs of Baetiong, petitioner among them, had since been barred clearly shows their unlawful deprivation of plaintiffs’ possession over
from asserting such contention by reason of laches. said property.22

It should be understood that these pronouncements contained in the Evidently, the MeTC considered Lot No. 2-F-4 as beyond the scope
earlier Court of Appeals decision have the force of law between the of the lease agreement because the leased area, as shown by the
parties. Since this decision establishes the right of respondents to subdivision plan, covered only three (3) particular lots, namely Lots
occupy by way of lease a portion of TCT No. 44546 which may even No. 2-E, 2-F-1, and 2-F-2, with these three lots covering a total area
exceed three (3) hectares, it thus becomes imperative for petitioner to of 3.1 hectares. But that was contrary to the decision of the Court of
establish her cause of action which is that respondent had beyond that Appeals. Hence, in order that the trial court could rule in favor of
which they were entitled to occupy according to the decision of the petitioner without unsettling the earlier final and executory decision
Court of Appeals. Following the Court of Appeals decision, of the Court of Appeals, it should have been able to establish that Lot
respondents would be entitled to remain in possession of the portion No. 2-F-4 was outside the coverage of the Contract of Lease as
which they were actually occupying at the time of the execution of the construed by the appellate court.
Contract of Lease even if such portion exceeded three (3) hectares.
This being the case, it was not enough for petitioner to establish that
The instant complaint predicated petitioner’s cause of action on her she was the owner of Lot No. 2-F-4 which is the sole allegation in her
alleged ownership of Lot No. 2-F-4, without any reference to the complaint in support of her cause of action. Neither would it have been
subsisting Contract of Lease.19 In answer, respondents asserted that sufficient on her part to prove that the three (3) hectares contemplated
they had been in actual possession of the said portion since 1962.20 The in the Contract of Lease consisted only of Lots No. 2-E, 2-F-1, and 2-
decision of the MTC did not dwell on this claim of respondents. F-2. By reason of the conclusiveness of the final judgment of the Court
Instead, it proceeded from the initial premise that petitioner’s right of of Appeals, it was essential on her part to establish that Lot No. 2-F-4
ownership over Lot No. 2-F-4 was evidenced by the Extra-Judicial was not among that portion which respondents had been occupying at
Settlement,21 then followed it with the following observations the time of the execution of the Contract of Lease. Had respondents
regarding the Contract of Lease: not been occupying Lot No. 2-F-4 when the Contract of Lease was
executed, petitioner would have had the right to seek the ejectment of
As could be gleaned from the Contract of Lese dated November 10, respondents from the said lot, as the said portion would not have been
1993, executed between Roman Macabagdal, Edlinda Macabagdal- among that which the Court of Appeals had earlier ruled respondents
Francisco and Editha Macabagdal-Francisco (herein plaintiff) as were entitled to possess by way of lease. However, since the right to
institute an action for forcible entry or unlawful detainer extends only already occupied by respondents when the lease contract was
in the absence of the right to hold possession, whether by virtue of any executed, her complaint may have been sustained. However, this
contract or otherwise, or upon the expiration of such right, the burden question of fact was not preponderantly established in the lower
lies on petitioner as plaintiff to establish that respondents had no legal courts, and there is no basis for the Court to now make such a de novo
right to enter into possession of Lot No. 2-F-4. Such burden is further factual finding.
militated by the earlier binding declarations of the Court of Appeals
on the scope in area of the Contract of Lease. One last point. We must reverse the Court of Appeals when it awarded
moral and exemplary damages, as well as attorney’s fees to
Moreover, the Court of Appeals also ruled that petitioner was barred respondents. In ruling that petitioner was in bad faith in filing the
from challenging the possession in lease by respondents of an area instant suit, the appellate court predicated this conclusion on the
exceeding the stipulated three (3) hectare limit. Certainly, petitioner observation that "respondent was well-aware that the issue involved
cannot predicate her right to withhold Lot No. 2-F-4 from in this case has already been settled by the courts. Due to this,
respondents’ possession on the basis that such lot exceeds the three (3) petitioners understandably suffered mental anguish and serious
hectares as stipulated in the compromise and lease agreements. As anxiety, thereby entitling them to moral damages."23
earlier stated, given the binding effect of the earlier Court of Appeals
decision, the fact that petitioner would have to establish to accord The Court is not wont to uphold awards of moral damages based on
merit to her complaint is that the subject lot was not in the possession haphazard conjectures on the awardee’s resultant mental state. We
of respondents at the time of the execution of the Contract of Lease, cannot agree with the appellate court that bad faith on the part of
and thus not subject to the said contract. petitioner had been preponderantly established in this case. Bad faith
does not simply connote bad judgment or negligence, but it imports a
Unfortunately for petitioner, not only did she fail to establish such fact, dishonest purpose or some moral obliquity and conscious doing of a
her very cause of action is not even premised on that ground. The wrong.24 It should be established by clear and convincing evidence
lower courts erred in maintaining blissful ignorance of the Court of since the law always presumes good faith.25 In ascertaining the
Appeals decision in CA-G.R. SP No. 18032 and ruling for petitioner, intention of the person accused of acting in bad faith, the courts must
despite the pronouncements made in that final and executory decision. carefully examine the evidence as to the conduct and outward acts
Indeed, in order that ejectment could be justified, it was imperative on from which the inward motive may be determined. 26 Certainly, it does
the lower courts to declare, after duly considering the earlier Court of not appear that the Court of Appeals has conducted the mandated
Appeals Decision, that respondents had no existing legal right to careful examination of evidence that would sustain the award of moral
possess Lot No. 2-F-4. No conclusion was drawn on such premises; damages. Nothing in the record establishes any right to moral damages
thus, the reversal made by the Court of Appeals must be sustained. by respondents.

It must be noted that the earlier Court of Appeals decision sustained Neither should exemplary damages avail under the circumstances. The
respondents’ right to occupy only a segregate portion of TCT No. plaintiff must show that he is entitled to moral, temperate or
44546, particularly that which they had already been occupying at the compensatory damages before the court may consider the question of
time the Contract of Lease was executed. Had petitioner been able to whether exemplary damages should be awarded.27 If the court has no
establish before the trial court that Lot No. 2-F-4 is outside that portion proof or evidence upon which the claim for moral damages could be
based, such indemnity could not be outrightly awarded. The same
holds true with respect to the award of exemplary damages where it
must be shown that the party acted in a wanton, oppressive or
malevolent manner. Furthermore, this specie of damages is allowed
only in addition to moral damages such that no exemplary damages
can be awarded unless the claimant first establishes his clear right to
moral damages.28

Contrary to the pronouncement of the Court of Appeals, the mere fact

that petitioners were constrained to litigate in order to protect and
assert their rights does not ipso facto entitle them to attorney’s fees.
What Article 2208 (2) of the Civil Code provides, in order that
attorney’s fees may be awarded, is that "the defendant’s act or
omission has compelled the plaintiff to litigate with third persons or
to incur expenses to protect his interest". It is settled that the fact that
the party was "compelled to litigate and incur expenses to protect and
enforce their claim does not justify the award of attorney's fees. The
general rule is that attorney's fees cannot be recovered as part of
damages because of the public policy that no premium should be
placed on the right to litigate. The award of attorney's fees must be
deleted where the award of moral and exemplary damages are
eliminated."29

WHEREFORE, the PETITION is GRANTED in PART. The Decision

of the Court of Appeals dated 17 August 2000 is AFFIRMED with the
MODIFICATION that the award of moral, exemplary damages and
attorney’s fees are DELETED. No costs.

SO ORDERED.
G.R. No. 152040 March 31, 2006 (1) The front exterior and the right side concrete columns of
the covered terrace were vertically displaced from its original
MARIKINA AUTO LINE TRANSPORT CORPORATION and position causing exposure of the vertical reinforcement.
FREDDIE L. SUELTO, Petitioners,
vs. (2) The beams supporting the roof and parapet walls are found
PEOPLE OF THE PHILIPPINES and ERLINDA V. with cracks on top of the displaced columns.
VALDELLON, Respondents.
(3) The 6″ CHB walls at [the] right side of the covered terrace
DECISION were found with cracks caused by this accident.

CALLEJO, SR., J.: (4) The front iron grills and concrete balusters were found
totally damaged and the later [sic] beyond repair. 4
Before the Court is a Petition for Review on Certiorari of the
Decision1 of the Court of Appeals (CA) in CA-G.R. CR No. 16739 He recommended that since the structural members made of concrete
affirming the Joint Decision of the Regional Trial Court (RTC) in had been displaced, the terrace would have to be demolished "to keep
Criminal Case No. Q-93-42629 and Civil Case No. Q-93-16051, its monolithicness, and to insure the safety and stability of the
where Freddie Suelto was convicted of reckless imprudence resulting building."5
in damages to property.
Photographs6 of the damaged terrace were taken. Valdellon
Erlinda V. Valdellon is the owner of a two-door commercial apartment commissioned Engr. Jesus R. Regal, Jr. to estimate the cost of repairs,
located at No. 31 Kamias Road, Quezon City. The Marikina Auto Line inclusive of labor and painting, and the latter pegged the cost
Transport Corporation (MALTC) is the owner-operator of a passenger at P171,088.46.7
bus with Plate Number NCV-849. Suelto, its employee, was assigned
as the regular driver of the bus.2 In a letter dated October 19, 1992 addressed to the bus company and
Suelto, Valdellon demanded payment of P148,440.00, within 10 days
At around 2:00 p.m. on October 3, 1992, Suelto was driving the from receipt thereof, to cover the cost of the damage to the
aforementioned passenger bus along Kamias Road, Kamuning, terrace.8 The bus company and Suelto offered a P30,000.00 settlement
Quezon City, going towards Epifanio de los Santos Avenue (EDSA). which Valdellon refused. 9
The bus suddenly swerved to the right and struck the terrace of the
commercial apartment owned by Valdellon located along Kamuning Valdellon filed a criminal complaint for reckless imprudence resulting
Road.3 Upon Valdellon’s request, the court ordered Sergio Pontiveros, in damage to property against Suelto. After the requisite preliminary
the Senior Building Inspection Officer of the City Engineer’s Office, investigation, an Information was filed with the RTC of Quezon City.
to inspect the damaged terrace. Pontiveros submitted a report The accusatory portion of the Information reads:
enumerating and describing the damages:
That on or about the 3rd day of October 1992, in Quezon City,
Philippines, the said accused, being then the driver and/or person in
charge of a Marikina Auto Line bus bearing Plate No. NVC-849, did c) the sum of P20,000.00 as attorney’s fees and the sum
then and there unlawfully, and feloniously drive, manage, and operate of P1,000.00 for each appearance of plaintiff’s counsel; and
the same along Kamias Road, in said City, in a careless, reckless, costs of suit;
negligent, and imprudent manner, by then and there making the said
vehicle run at a speed greater than was reasonable and proper without PLAINTIFF further prays for such other reliefs as may be just and
taking the necessary precaution to avoid accident to person/s and equitable in the premises.11
damage to property, and considering the condition of the traffic at said
place at the time, causing as a consequence of his said carelessness, A joint trial of the two cases was ordered by the trial court. 12
negligence, imprudence and lack of precaution, the said vehicle so
driven, managed and operated by him to hit and bump, as in fact it hit The trial court conducted an ocular inspection of the damaged terrace,
and bump a commercial apartment belonging to ERLINDA V. where defendants offered to have it repaired and restored to its original
VALDELLON located at No. 31 Kamias Road, this City, thereby state. Valdellon, however, disagreed because she wanted the building
causing damages to said apartment in the total amount of P171,088.46, demolished to give way for the construction of a new one. 13
Philippine Currency, to her damage and prejudice in the total amount
aforementioned. During the trial, Valdellon testified on the damage caused to the
terrace of her apartment, and, in support thereof, adduced in evidence
CONTRARY TO LAW.10 a receipt for P35,000.00, dated October 20, 1993, issued by the BB
Construction and Steel Fabricator for "carpentry, masonry, welding
Valdellon also filed a separate civil complaint against Suelto and the job and electrical [work]."14
bus company for damages. She prayed that after due proceedings,
judgment be rendered in her favor, thus: Pontiveros of the Office of the City Engineer testified that there was a
need to change the column of the terrace, but that the building should
WHEREFORE, it is respectfully prayed of this Honorable Court to also be demolished because "if concrete is destroyed, [one] cannot
issue a writ of preliminary attachment against the defendants upon have it restored to its original position."15
approval of plaintiff’s bond, and after trial on the merits, to render a
decision in favor of the plaintiff, ordering the defendants, jointly and Engr. Jesus Regal, Jr., the proprietor of the SSP Construction, declared
severally, to pay – that he inspected the terrace and estimated the cost of repairs,
including labor, at P171,088.46.
a) the total sum of P171,088.46 constituting the expenses for
the repair of the damaged apartment of plaintiff, with interests Suelto testified that at 2:00 p.m. on October 3, 1992, he was driving
to be charged thereon at the legal rate from the date of the the bus on its way to Ayala Avenue, Makati, Metro Manila. When he
formal demand until the whole obligation is fully paid; reached the corner of K-H Street at Kamias Road, Quezon City, a
passenger jeepney suddenly crossed from EDSA going to V. Luna and
b) the sum of not less than P20,000.00 each as compensatory swerved to the lane occupied by the bus. Suelto had to swerve the bus
and exemplary damages; to the right upon which it hit the side front of the terrace of Valdellon’s
two-door apartment.16 Based on his estimate, the cost to the damage
on the terrace of the apartment amounted to P40,000.00.17 On cross- MALTC and Suelto, now appellants, appealed the decision to the CA,
examination, Suelto declared that he saw the passenger jeepney when alleging that the prosecution failed to prove Suelto’s guilt beyond
it was a meter away from the bus. Before then, he had seen some reasonable doubt. They averred that the prosecution merely relied on
passenger jeepneys on the right trying to overtake one another. 18 Valdellon, who testified only on the damage caused to the terrace of
her apartment which appellants also alleged was excessive. Appellant
Architect Arnulfo Galapate testified that the cost of the repair of the Suelto further alleged that he should be acquitted in the criminal case
damaged terrace amounted to P55,000.00.19 for the prosecution’s failure to prove his guilt beyond reasonable
doubt. He maintained that, in an emergency case, he was not, in law,
On April 28, 1994, the trial court rendered judgment finding Suelto negligent. Even if the appellate court affirmed his conviction, the
guilty beyond reasonable doubt of reckless imprudence resulting in penalty of imprisonment imposed on him by the trial court is contrary
damage to property, and ordered MALTC and Suelto to pay, jointly to law.
and severally, P150,000.00 to Valdellon, by way of actual and
compensatory damages, as well as attorney’s fees and costs of suit. In its Brief for the People of the Philippines, the Office of the Solicitor
The fallo of the decision reads: General (OSG) submitted that the appealed decision should be
affirmed with modification. On Suelto’s claim that the prosecution
WHEREFORE, finding the accused FREDDIE SUELTO Y LIWAG failed to prove his guilt for the crime of reckless imprudence resulting
guilty beyond reasonable doubt of the crime of Reckless Imprudence in damage to property, the OSG contended that, applying the principle
Resulting in Damage to Property, said accused is hereby sentenced to of res ipsa loquitur, the prosecution was able to prove that he drove
suffer imprisonment of ONE (1) YEAR. the bus with negligence and recklessness. The OSG averred that the
prosecution was able to prove that Suelto’s act of swerving the bus to
With respect to the civil liability, judgment is hereby rendered in favor the right was the cause of damage to the terrace of Valdellon’s
of plaintiff Erlinda Valdellon and against defendant Marikina Auto apartment, and in the absence of an explanation to the contrary, the
Line Transport Corporation and accused Freddie Suelto, where both accident was evidently due to appellant’s want of care. Consequently,
are ordered, jointly and severally, to pay plaintiff: the OSG posited, the burden was on the appellant to prove that, in
swerving the bus to the right, he acted on an emergency, and failed to
a. the sum of P150,000.00, as reasonable compensation discharge this burden. However, the OSG averred that the trial court
sustained by plaintiff for her damaged apartment; erred in sentencing appellant to a straight penalty of one year, and
recommended a penalty of fine.
b. the sum of P20,000.00, as compensatory and exemplary
damages; On June 20, 2000, the CA rendered judgment affirming the decision
of the trial court, but the award for actual damages was reduced
to P100,000.00. The fallo of the decision reads:
c. the sum of P20,000.00, as attorney’s fees; and,
WHEREFORE, premises considered, the decision dated April 28,
d. the costs of suit.
1994, rendered by the court a quo is AFFIRMED with the
modification that the sum of P150,000.00 as compensation sustained
SO ORDERED.20
by the plaintiff-appellee for her damaged apartment be reduced Suelto swerved the bus to the right with recklessness, thereby causing
to P100,000.00 without pronouncement as to costs. damage to the terrace of private respondent’s apartment. Although she
did not testify to seeing the incident as it happened, petitioner Suelto
SO ORDERED.21 himself admitted this in his answer to the complaint in Civil Case No.
Q-93-16051, and when he testified in the trial court.
Appellants filed a Motion for Reconsideration, but the CA denied the
same.22 Suelto narrated that he suddenly swerved the bus to the right of the
road causing it to hit the column of the terrace of private respondent.
MALTC and Suelto, now petitioners, filed the instant petition Petitioners were burdened to prove that the damage to the terrace of
reiterating its submissions in the CA: (a) the prosecution failed to private respondent was not the fault of petitioner Suelto.
prove the crime charged against petitioner Suelto; (b) the prosecution
failed to adduce evidence to prove that respondent suffered actual We have reviewed the evidence on record and find that, as ruled by
damages in the amount of P100,000.00; and (c) the trial court erred in the trial court and the appellate court, petitioners failed to prove that
sentencing petitioner Suelto to one (1) year prison term. petitioner acted on an emergency caused by the sudden intrusion of a
passenger jeepney into the lane of the bus he was driving.
On the first issue, petitioners aver that the prosecution was mandated
to prove that petitioner Suelto acted with recklessness in swerving the It was the burden of petitioners herein to prove petitioner Suelto’s
bus to the right thereby hitting the terrace of private respondent’s defense that he acted on an emergency, that is, he had to swerve the
apartment. However, the prosecution failed to discharge its burden. bus to the right to avoid colliding with a passenger jeep coming from
On the other hand, petitioner Suelto was able to prove that he acted in EDSA that had overtaken another vehicle and intruded into the lane of
an emergency when a passenger jeepney coming from EDSA towards the bus. The sudden emergency rule was enunciated by this Court in
the direction of the bus overtook another vehicle and, in the process, Gan v. Court of Appeals,23 thus:
intruded into the lane of the bus.
[O]ne who suddenly finds himself in a place of danger, and is required
On the second issue, petitioners insist that private respondent was able to act without time to consider the best means that may be adopted to
to prove only the amount of P35,000.00 by way of actual damages; avoid the impending danger, is not guilty of negligence if he fails to
hence, the award of P100,000.00 is barren of factual basis. adopt what subsequently and upon reflection may appear to have been
a better method unless the emergency in which he finds himself is
On the third issue, petitioner Suelto posits that the straight penalty of brought about by his own negligence.
imprisonment recommended by the trial court, and affirmed by the
CA, is contrary to Article 365 of the Revised Penal Code. Under Section 37 of Republic Act No. 4136, as amended, otherwise
known as the Land Transportation and Traffic Code, motorists are
The petition is partially granted. mandated to drive and operate vehicles on the right side of the road or
highway:
On the first issue, we find and so resolve that respondent People of the
Philippines was able to prove beyond reasonable doubt that petitioner
SEC. 37. Driving on right side of highway. – Unless a different course It is clear from the photographs submitted by the prosecution (Exhs.
of action is required in the interest of the safety and the security of life, C, D, G, H & I) that the commercial apartment of Dr. Valdellon
person or property, or because of unreasonable difficulty of operation sustained heavy damage caused by the bus being driven by Suelto. "It
in compliance herewith, every person operating a motor vehicle or an seems highly improbable that the said damages were not caused by a
animal-drawn vehicle on a highway shall pass to the right when strong impact. And, it is quite reasonable to conclude that, at the time
meeting persons or vehicles coming toward him, and to the left when of the impact, the bus was traveling at a high speed when Suelto tried
overtaking persons or vehicles going the same direction, and when to avoid the passenger jeepney." Such a conclusion finds support in
turning to the left in going from one highway to another, every vehicle the decision of the Supreme Court in People vs. Ison, 173 SCRA 118,
shall be conducted to the right of the center of the intersection of the where the Court stated that "physical evidence is of the highest order.
highway. It speaks more eloquently than a hundred witnesses." The pictures
submitted do not lie, having been taken immediately after the incident.
Section 35 of the law provides, thus: The damages could not have been caused except by a speeding bus.
Had the accused not been speeding, he could have easily reduced his
Sec. 35. Restriction as to speed.—(a) Any person driving a motor speed and come to a full stop when he noticed the jeep. Were he more
vehicle on a highway shall drive the same at a careful and prudent prudent in driving, he could have avoided the incident or even if he
speed, not greater nor less than is reasonable and proper, having due could not avoid the incident, the damages would have been less severe.
regard for the traffic, the width of the highway, and of any other
condition then and there existing; and no person shall drive any motor In addition to this, the accused has made conflicting statements in his
vehicle upon a highway at such a speed as to endanger the life, limb counter-affidavit and his testimony in court. In the former, he stated
and property of any person, nor at a speed greater than will permit him that the reason why he swerved to the right was because he wanted to
to bring the vehicle to a stop within the assured clear distance ahead avoid the passenger jeepney in front of him that made a sudden stop.
(emphasis supplied). But, in his testimony in court, he said that it was to avoid a passenger
jeepney coming from EDSA that was overtaking by occupying his
In relation thereto, Article 2185 of the New Civil Code provides that lane. Such glaring inconsistencies on material points render the
"unless there is proof to the contrary, it is presumed that a person testimony of the witness doubtful and shatter his credibility.
driving a motor vehicle has been negligent, if at the time of mishap, Furthermore, the variance between testimony and prior statements
he was violating any traffic regulation." By his own admission, renders the witness unreliable. Such inconsistency results in the loss
petitioner Suelto violated the Land Transportation and Traffic Code in the credibility of the witness and his testimony as to his prudence
when he suddenly swerved the bus to the right, thereby causing and diligence.
damage to the property of private respondent.
As already maintained and concluded, the severe damages sustained
However, the trial court correctly rejected petitioner Suelto’s defense, could not have resulted had the accused acted as a reasonable and
in light of his contradictory testimony vis-à-vis his Counter-Affidavit prudent man would. The accused was not diligent as he claims to be.
submitted during the preliminary investigation: What is more probable is that the accused had to swerve to the right
and hit the commercial apartment of the plaintiff because he could not
make a full stop as he was driving too fast in a usually crowded The damaged portions of the apartment in question are not disputed.
street.24
Considering the aforesaid damages which are the direct result of the
Moreover, if the claim of petitioners were true, they should have filed accident, the reasonable, and adequate compensation due is hereby
a third-party complaint against the driver of the offending passenger fixed at P100,000.00.25
jeepney and the owner/operator thereof.
Under Article 2199 of the New Civil Code, actual damages include all
Petitioner Suelto’s reliance on the sudden emergency rule to escape the natural and probable consequences of the act or omission
conviction for the crime charged and his civil liabilities based thereon complained of, classified as one for the loss of what a person already
is, thus, futile. possesses (daño emergente) and the other, for the failure to receive, as
a benefit, that which would have pertained to him (lucro cesante). As
On the second issue, we agree with the contention of petitioners that expostulated by the Court in PNOC Shipping and Transport
respondents failed to prove that the damages to the terrace caused by Corporation v. Court of Appeals:26
the incident amounted to P100,000.00. The only evidence adduced by
respondents to prove actual damages claimed by private respondent Under Article 2199 of the Civil Code, actual or compensatory
were the summary computation of damage made by Engr. Jesus R. damages are those awarded in satisfaction of, or in recompense for,
Regal, Jr. amounting to P171,088.46 and the receipt issued by the BB loss or injury sustained. They proceed from a sense of natural justice
Construction and Steel Fabricator to private respondent and are designed to repair the wrong that has been done, to compensate
for P35,000.00 representing cost for carpentry works, masonry, for the injury inflicted and not to impose a penalty. In actions based
welding, and electrical works. Respondents failed to present Regal to on torts or quasi-delicts, actual damages include all the natural and
testify on his estimation. In its five-page decision, the trial court probable consequences of the act or omission complained of. There
awarded P150,000.00 as actual damages to private respondent but are two kinds of actual or compensatory damages: one is the loss of
failed to state the factual basis for such award. Indeed, the trial court what a person already possesses (daño emergente), and the other is the
merely declared in the decretal portion of its decision that the "sum failure to receive as a benefit that which would have pertained to him
of P150,000.00 as reasonable compensation sustained by plaintiff for (lucro cesante).27
her damaged apartment." The appellate court, for its part, failed to
explain how it arrived at the amount of P100,000.00 in its three-page The burden of proof is on the party who would be defeated if no
decision. Thus, the appellate court merely declared: evidence would be presented on either side. The burden is to establish
one’s case by a preponderance of evidence which means that the
With respect to the civil liability of the appellants, they contend that evidence, as a whole, adduced by one side, is superior to that of the
there was no urgent necessity to completely demolish the apartment in other. Actual damages are not presumed. The claimant must prove the
question considering the nature of the damages sustained as a result of actual amount of loss with a reasonable degree of certainty premised
the accident. Consequently, appellants continue, the award upon competent proof and on the best evidence obtainable. Specific
of P150,000.00 as compensation sustained by the plaintiff-appellee for facts that could afford a basis for measuring whatever compensatory
her damaged apartment is an unconscionable amount. or actual damages are borne must be pointed out. Actual damages
cannot be anchored on mere surmises, speculations or conjectures. As We agree with the Court of Appeals that his testimony as to the
the Court declared: equipment installed and the cargoes loaded on the vessel should be
given credence considering his familiarity thereto. However, we do
As stated at the outset, to enable an injured party to recover actual or not subscribe to the conclusion that his valuation of such equipment,
compensatory damages, he is required to prove the actual amount of cargo, and the vessel itself should be accepted as gospel truth. We
loss with reasonable degree of certainty premised upon competent must, therefore, examine the documentary evidence presented to
proof and on the best evidence available. The burden of proof is on the support Del Rosario’s claim as regards the amount of losses. 30
party who would be defeated if no evidence would be presented on
either side. He must establish his case by a preponderance of evidence An estimate of the damage cost will not suffice:
which means that the evidence, as a whole, adduced by one side is
superior to that of the other. In other words, damages cannot be Private respondents failed to adduce adequate and competent proof of
presumed and courts, in making an award, must point out specific facts the pecuniary loss they actually incurred. It is not enough that the
that could afford a basis for measuring whatever compensatory or damage be capable of proof but must be actually proved with a
actual damages are borne.28 reasonable degree of certainty, pointing out specific facts that afford a
basis for measuring whatever compensatory damages are borne.
The Court further declared that "where goods are destroyed by the Private respondents merely sustained an estimated amount needed for
wrongful act of defendant, the plaintiff is entitled to their value at the the repair of the roof of their subject building. What is more, whether
time of the destruction, that is, normally, the sum of money which he the necessary repairs were caused only by petitioner’s alleged
would have to pay in the market for identical or essentially similar negligence in the maintenance of its school building, or included the
goods, plus in a proper case, damages for the loss of the use during the ordinary wear and tear of the house itself, is an essential question that
period before replacement.29 remains indeterminable.31

While claimants’ bare testimonial assertions in support of their claims We note, however, that petitioners adduced evidence that, in their
for damages should not be discarded altogether, however, the same view, the cost of the damage to the terrace of private respondent would
should be admitted with extreme caution. Their testimonies should be amount to P55,000.00.32 Accordingly, private respondent is entitled
viewed in light of claimants’ self-interest, hence, should not be taken to P55,000.00 actual damages.
as gospel truth. Such assertion should be buttressed by independent
evidence. In the language of the Court: We also agree with petitioner Suelto’s contention that the trial court
erred in sentencing him to suffer a straight penalty of one (1) year.
For this reason, Del Rosario’s claim that private respondent incurred This is so because under the third paragraph of Article 365 of the
losses in the total amount of P6,438,048.00 should be admitted with Revised Penal Code, the offender must be sentenced to pay a fine
extreme caution considering that, because it was a bare assertion, it when the execution of the act shall have only resulted in damage to
should be supported by independent evidence. Moreover, because he property. The said provision reads in full:
was the owner of private respondent corporation whatever testimony
he would give with regard to the value of the lost vessel, its equipment ART. 365. Imprudence and negligence. – Any person who, by reckless
and cargoes should be viewed in the light of his self-interest therein. imprudence, shall commit any act which, had it been intentional,
would constitute a grave felony, shall suffer the penalty of arresto circumstances, we rule that private respondent Valdellon is entitled to
mayor in its maximum period, to prision correccional in its medium only P20,000.00 by way of exemplary damages.
period; if it would have constituted a less grave felony, the penalty of
arresto mayor in its minimum and medium periods shall be imposed; IN LIGHT OF ALL THE FOREGOING, the petition is PARTIALLY
if it would have constituted a light felony, the penalty of arresto menor GRANTED. The joint decision of the Regional Trial Court of Quezon
in its maximum period shall be imposed. City is AFFIRMED WITH THE MODIFICATION that petitioner
Suelto is sentenced to pay a fine of P55,000.00 with subsidiary
Any person who, by simple imprudence or negligence, shall commit imprisonment in case of insolvency. Petitioners are ORDERED to pay
an act which would, otherwise, constitute a grave felony, shall suffer to Erlinda V. Valdellon, jointly and severally, the total amount
the penalty of arresto mayor in its medium and maximum periods; if of P55,000.00 by way of actual damages, and P20,000.00 by way of
it would have constituted a less serious felony, the penalty of arresto exemplary damages.
mayor in its minimum period shall be imposed.
No pronouncement as to costs.
When the execution of the act covered by this article shall have only
resulted in damage to the property of another, the offender shall be SO ORDERED.
punished by a fine ranging from an amount equal to the value of said
damages to three times such value, but which shall in no case be less
than 25 pesos.

A fine not exceeding two hundred pesos and censure shall be imposed
upon any person who, by simple imprudence or negligence, shall
cause some wrong which, if done maliciously, would have constituted
a light felony.

In the imposition of these penalties, the courts shall exercise their

sound discretion, without regard to the rules prescribed in Article 64
(Emphasis supplied).

In the present case, the only damage caused by petitioner Suelto’s act
was to the terrace of private respondent’s apartment,
costing P55,000.00. Consequently, petitioner’s contention that the CA
erred in awarding P100,000.00 by way of actual damages to private
respondent is correct. We agree that private respondent is entitled to
exemplary damages, and find that the award given by the trial court,
as affirmed by the CA, is reasonable. Considering the attendant
G.R. No. 132659 February 12, 2007 another, with intent to gain and with the use of force upon things by
then and there making a hole on the lower portion of the kitchen’s door
CONRADO MAGBANUA and ROSEMARIE MAGBANUA- of the house of the herein offended party, Dra. Pilar S. Junsay, situated
TABORADA, the latter assisted by her husband ARTEMIO at Bata Subdivision, Bacolod City, through which opening made (sic)
TABORADA,Petitioners, them, said accused gained entrance thereto and once inside the said
vs. house, did, then and there willfully, unlawfully and feloniously take,
PILAR S. JUNSAY, asssisted by her husband VICENTE rob and carry away with them, assorted jewelries and cash, valued all
JUNSAY, IBARRA LOPEZ, and JUANITO in all in the amount of ₱29,624.00, Pesos, Philippine Currency, to the
JACELA, Respondents. damage and prejudice of the herein offended party in the
aforementioned amount.3
DECISION
The records show that only petitioner Rosemarie was tried in Criminal
CHICO-NAZARIO, J.: Case No. 28. Her co-accused, Ernesto Fernandez and a certain Gudo,
remain at large.
This is an Appeal by Certiorari from the Decision,1 dated 26 January
1998, of the Court of Appeals in CA-G.R. CV No. 51750, which The case for the prosecution relied on an alleged confession made by
affirmed in toto the Decision,2 dated 25 July 1995, of the Regional petitioner Rosemarie, admitting her participation in the crime of
Trial Court (RTC), Branch 51, Bacolod City, in Civil Case No. 4361, Robbery. The defense contested the admissibility of the confession,
dismissing the Complaint for Damages for malicious prosecution, and averred that the same was made under duress.
filed by petitioners against respondents. The RTC rendered judgment
declaring that the prosecution was not prompted by sinister design to On 20 December 1985, the RTC, Branch XLI of Bacolod City,
vex and humiliate petitioner Rosemarie Magbanua. The Court of rendered a Decision,4 acquitting petitioner Rosemarie of the crime of
Appeals similarly found the appeal without merit. Robbery. The RTC held:

The following are the antecedent facts: The evidence for accused [herein petitioner Rosemarie] more
particularly the Medical Certificate and the testimony of the attending
Petitioner Rosemarie Magbanua, who worked as a housemaid in the physician as well as the Decision of the NAPOLCOM finding the
residence of complainant and herein respondent Pilar S. Junsay was investigating officers guilty has clearly establish (sic) the fact that
charged as a co-accused with the crime of Robbery before the RTC, accused was physically maltreated by the investigating officers in an
Branch XLI of Bacolod City in Criminal Case No. 28 entitled, People attempt to force her to confess her participation in the robbery.
of the Philippines v. Rosemarie Magbanua, et al., by virtue of an Whatever declaration of accused therefore against her interest is
Information, which recites, thus: inadmissible in evidence against her, hence, the alleged admission of
the accused that she participated in the commission of the Robbery
That on or about the 18th day of July, 1982, in the City of Bacolod, made to the police investigator and complainant [complainant
Philippines, and within the jurisdiction of this Honorable Court, the respondent Pilar] even if it is true cannot be used against her.
herein accused, conspiring, confederating and mutually helping one Notwithstanding however, accused could still be found guilty if the
evidence for the prosecution is sufficient to establish her participation The Complaint, alleged, inter alia, that by reason of respondents’ false,
in the crime without said alleged admission by the accused. Record, malicious, and illegal actuations in filing Criminal Case No. 28 for
however, shows that other than the alleged admission of the accused Robbery against petitioner Rosemarie, the latter suffered untold pain,
made to the police investigator and the complainant, the only evidence shame, humiliation, worry, and mental anguish, which if assessed in
to establish the participation of the accused in the robbery is the monetary terms will not be less than ₱200,000.00. 8 It was further
testimony of the complaining witness that after accused informed her alleged therein that Conrado, Rosemarie’s father, lost his job and his
that part of the jewelry stolen was inside her bag at her room, the entire family suffered.9 Petitioners maintained that Rosemarie suffered
complaining witness searched the room of accused and found one (1) physical pain and mental torture due to the filing of the false criminal
piece of gold necklace. On this point, the evidence adduced shows that charge against her.10 They sought moral and exemplary damages,
the police authorities went at (sic) the scene of the robbery and including attorney’s fees and litigation expenses, as well as loss of
thoroughly investigated the incident including dusting for fingerprints, earnings and expenses incurred in connection with Rosemarie’s
tending to show that the investigation of the police authorities was defense in Criminal Case No. 28 for Robbery.11 They similarly prayed
extensive, hence, it was quite improbable and difficult to believe that for payment of the expenses incurred in the prosecution of the instant
the police investigator would fail to search the bag nor the room of case.
accused. This Court[,] therefore[,] find said testimony of the
complaining witness on this point discredited.5 Subsequently, petitioners filed a Petition to litigate as pauper which
the RTC granted in its Order dated 9 March 1987, it appearing that
The decretal portion of the 20 December 1985 RTC Decision they had no means to prosecute their action. 12
pronounced:
Respondent Pilar filed a Motion to Dismiss, 13 on the ground that the
IN VIEW OF THE FOREGOING THEREFORE, this Court finds the cause of action is barred by the Statute of Limitations, as crystallized
evidence for the prosecution not only insufficient to prove the guilt of in Article 114614 of the Civil Code. From the time the cause of action
the accused beyond reasonable doubt but even insufficient to establish arose to the filing of the Complaint, four years and eight months had
a prima facie case against her for having participated in the robbery already lapsed.
subject of the above entitled case and therefore ACQUITS accused on
the ground of insufficiency of evidence. The bailbond of the accused Petitioners filed an Opposition to the Motion to Dismiss, 15 contending
for her provisional liberty is hereby ordered cancelled. 6 that their cause of action is not for damages based on the physical
injuries suffered by Rosemarie during the investigation of the criminal
On 9 March 1987, petitioner Rosemarie, assisted by Artemio case nor the violation of her rights for the indignities foisted upon her
Taborada, and together with co-petitioner Conrado Magbanua by the respondents from 18 July 1982, and several days
(Rosemarie’s father) filed with the RTC, Branch 51, Bacolod City, a thereafter.16 They posited that the damages sought are for the
Complaint for Damages 7 against respondent Pilar, assisted by her malicious prosecution of Rosemarie. They reasoned that the baseless
husband Vicente Junsay, Ibarra Lopez, and Juanito Jacela. Respondent filing of the criminal case for Robbery against Rosemarie, despite her
Pilar was the employer of petitioner Rosemarie, while respondents protestations of innocence and the lack of evidence against her, caused
Ibarra and Juanito were members of the police force of Bacolod City, her family to incur expenses and subjected her to untold shame and
and assigned at the Police Station in Taculing, Bacolod City. humiliation.17 Petitioners clarified that the allegations about the
violation of Rosemarie’s rights as a person were included only to Petitioners filed a Reply and Answer to Counterclaim, 22 reiterating the
demonstrate respondents’ palpable malice in the filing of the said allegation in the Complaint, that respondent Pilar actually participated
criminal case against her. Petitioners postulated that as the Complaint in the maltreatment of petitioner Rosemarie, and she cannot deny her
for Damages is for malicious prosecution, the prescriptive period participation as she was always present in the police station during the
should be counted from the date of Rosemarie’s acquittal in Criminal investigation. Petitioners alleged that respondent Pilar cannot claim
Case No. 28, or on 20 December 1985, and not from 18 July 1982, the lack of knowledge of the maltreatment and indignities suffered by
date when respondents injured the rights of Rosemarie. From the time petitioner Rosemarie because she herself participated in such
judgment in Criminal Case No. 28 was rendered to the filing of the maltreatment. Petitioners further contended, inter alia, that they have
Complaint in the instant case, not more than one year and three months a proper and valid cause of action against the respondents, including
had passed.18 petitioner Conrado who suffered and incurred expenses to defend his
daughter, Rosemarie, who was then a minor against unjust accusation,
On 24 March 1988, the RTC issued an Order 19 denying respondents’ maltreatment and torture.
Motion to Dismiss for lack of merit. It found that the cause of action
of petitioners’ Complaint was based on malicious prosecution; hence, On 9 September 1988, at the pre-trial, the parties entered into a
the prescriptive period shall be counted from the date of petitioner stipulation of facts. Counsel for the petitioners manifested that they
Rosemarie’s acquittal. According to the RTC, the allegations about were claiming damages not for physical injuries which petitioner
the wanton violation of the rights of Rosemarie as a person were to Rosemarie allegedly suffered in the hands of respondents during her
show the pattern of respondents’ malice. investigation, but for her malicious prosecution. 23 In concurrence
thereto, counsel for respondents declared that the main issue was
Respondent Pilar filed before the RTC an Answer, 20 dated 18 May whether Rosemarie was maliciously prosecuted with the filing of the
1988, disclaiming petitioners’ allegation that she maltreated petitioner criminal case for Robbery.24 Following the stipulations and counter-
Rosemarie while the latter was being investigated by the police stipulation of facts, pre-trial was terminated.
authorities. She posited, inter alia: that she was not present during the
investigation, and was subsequently informed of petitioner Meanwhile, respondents Ibarra and Juanito, members of the police
Rosemarie’s participation in the robbery by the investigators, the same force of Bacolod City, filed an Answer and Manifestation, 25 adopting
being reflected in the Joint Affidavit of the police investigators; that the Answer filed by their co-respondent Pilar, dated 18 May 1988,
she never laid a hand on petitioner Rosemarie before, during, or after insofar as the allegations therein were applicable to them, and further
the investigation, as, in fact, she had no inkling of her participation in adopting the counterclaim interposed in the aforesaid action.
the crime; that she had no hand in the filing of the case except to
execute an affidavit regarding her ownership of the lost jewelry; and Trial, thereafter, ensued.
that she has no liability whatsoever to petitioner Rosemarie, much less,
to her father, petitioner Conrado, who does not appear to have any Seeking to fortify their case, petitioners offered the following exhibits,
involvement in the matter.21 By way of counterclaim, she sought to wit:
damages, including attorney’s fees, and costs of suit from the
petitioners.
Exhibit "A" – The medical certificate issued by Dr. Teodoro 28 entitled, "People of the Philippines vs. Rosemarie
S. Lavasa, Medico-legal officer and Chief, Crime Laboratory, Magbanua, et al." dated December 20, 1985.
Bacolod Metro Police District, dated July 27, 1982.
Exhibit "D-1" – The portion appearing on page 4 of said
This exhibit is offered to show the many injuries sustained by decision stating that, "IN VIEW OF THE FOREGOING
[herein petitioner] Rosemarie Magbanua at the hands of the THEREFORE, this Court finds the evidence for the
[herein respondents] in their joint effort to make her admit the prosecution not only insufficient to prove the guilt of the
crime in the absence of proof that she participated therein and accused beyond reasonable doubt but even insufficient to
despite her protestations of innocence. establish a prima facie case against her for having participated
in the robbery subject of the above entitled case and therefore
Exhibit "B" – The note of Dr. Teodoro S. Lavada to the jail ACQUITS accused on the ground of insufficiency of
warden. evidence. The bailbond of the accused for her provisional
liberty is hereby ordered cancelled."
This exhibit is offered to show the result of the maltreatment
and/or physical injuries inflicted by the [respondents] on the This exhibit with its sub-marking is offered to show that the
person of [petitioner] Rosemarie Magbanua – hemoptysis, [petitioner] Rosemarie Magbanua was acquitted of the crime
fever, and body pains - which made the medico-legal officer charged because the evidence for the prosecution was not only
recommend hospitalization for her. insufficient to prove the guilt of the accused beyond
reasonable doubt but even insufficient to establish a prima
Exhibit "C" – The information filed by Fiscal Ricardo F. facie evidence against her for having participated in the
Tornilla, 2nd Asst. City Fiscal, Bacolod City, dated July 20, robbery, thus glaringly exposing the utter lack of basis for
1982. charging and/or prosecuting Rosemarie Magbanua for the
crime of robbery which was nevertheless filed at the behest of
This exhibit is offered to show the result of the [respondents’] the [respondents] who knowing fully the bereftness of their
confederated efforts for Rosemarie Magbanua to be stand even tried to concoct additional evidence of having
prosecuted for the crime she did not commit, including untrue found still more jewelry in [petitioner] Rosemarie
affidavits, a biased and false investigation report mentioning Magbanua’s handbag, a maneuver which was debunked by
Rosemarie Magbanua’s alleged confession of her the honorable Court in its decision.
participation in the robbery when she never did, despite the
injuries and indignities to which she was subjected, all of Exhibit "E" – The decision of the National Police Commission
which made the Asst. City Fiscal Ricardo F. Tornilla file the Adjudication Board No. 11 in Adm. Case No. 83-0888 finding
information against said plaintiff Rosemarie Magbanua. the respondent PFC Ibarra Lopez and respondent Patrolman
Juanito Jacela, two of the defendants, guilty of grave
Exhibit "D" – The Decision rendered by Hon. Quirino D. misconduct and ordering their suspension for two (2) months
Abad Santos, Jr., Judge, Regional Trial Court of Negros without pay.
Occidental, Branch XLI Bacolod City, in Criminal Case No.
 Exhibit "E-1" – The bracketed dispositive portion of the including respondents Ibarra and Juanito, proceeded to the residence
decision appearing on page 3 thereof which is as follows: of respondent Pilar. It ratiocinated that there was no legal malice on
the part of the latter as victim of the crime of robbery for bringing the
"IN VIEW OF THE FOREGOING, this Board finds respondents PFC same to the attention of the police authorities. The RTC similarly did
IBARRA LOPEZ AND PAT JUANITO JACELA guilty of not find legal malice on the part of her co-respondents, Ibarra and
Misconduct and they are hereby ordered SUSPENDED FOR TWO (2) Juanito, as they were merely performing their duties when they
MONTHS WITHOUT PAY WITH WARNING THAT A conducted the investigation; and subsequently filed the case against
REPETITION OF THE SAME OFFENSE SHALL BE PENALIZED petitioner Rosemarie and her co-accused pursuant thereto.
MORE SEVERELY."
In denying petitioners’ prayer for damages arising from malicious
This exhibit with its submarking is offered to show that the two (2) prosecution, the RTC ruled that:
[respondents], PFC Ibarra Lopez and Patrolman Juanito Jacela,
employed unnecessary force on the person of the [petitioner] In the course of the investigation, Rosemarie Magbanua admitted her
Rosemarie Magbanua just to make her admit and/or confess to a crime participation in the robbery together with a certain Ernesto Fernandez
she did not commit, thus contributing to and even making possible the and a person named "Gudo." The necklace given to her as her share
unnecessary, baseless, and malicious prosecution of the [petitioner]. 26 was recovered in her shoulder bag.

On 25 January 1991, the RTC issued an Order, 27 admitting Exhibits After the police authorities had completed their investigation, they
"A" to "E," including the sub-markings thereon for the purposes for filed a case for robbery with the office of the City Fiscal of Bacolod
which they had been offered and for such purpose as may serve the City (now City Prosecutor) against Rosemarie Magbanua, Ernesto
court a quo in the resolution of the case. 28 Fernandez and a certain "Gudo." The Office of the City Fiscal after
conducting a preliminary investigation filed a case for robbery against
On 25 July 1995, the RTC rendered a Decision dismissing the the three suspects. After trial, as against then accused now [herein
Complaint. The RTC applied the established rule that for a malicious petitioner] Rosemarie Magbanua, the Court acquitted her.
prosecution suit to succeed, two indispensable elements must be
shown to exist, to wit: (a) malice and (b) absence of probable cause. It [Herein respondent] Dra. Pilar Junsay, cannot be faulted for reporting
found that the elements were not successfully shown by petitioners. It to the police. She was robbed of valuables worth ₱29,974.00. Besides,
held that the mere filing of a suit does not render a person liable for she did not tell the police that she was robbed by herein [petitioner]
malicious prosecution should he be unsuccessful for the law could not Rosemarie Magbanua. And, there is no legal malice for a victim of a
have meant to impose a penalty on the right to litigate. 29 crime to report the matter to the police. Furthermore, the mere filing
of a suit does not render a person liable for malicious prosecution
In sustaining the respondents, the RTC said that the filing of the should he be unsuccessful for the law could not have meant to impose
criminal complaint against petitioner Rosemarie was not prompted a penalty on the right to litigate (Albenson Enterprises Corp. vs. Court
with a sinister design to vex, or humiliate her. It reasoned that of Appeals, 217 SCRA 16).
respondent Pilar reported the robbery which occurred on 17 July 1982
to the Bacolod Police Station; consequently, police investigators,
Neither can [respondents] police investigator Ibarra Lopez and Juanito In the present case, there was no proof that the prosecution was
Jacela be faulted for filing a complaint of robbery with the Office of prompted by a design to vex and humiliate the [herein petitioner]
the City Fiscal, against herein plaintiff Rosemarie Magbanua, Ernesto Rosemarie Magbanua. The crime of robbery was actually committed
Fernandez and a certain "Gudo." It is part of their duties to conduct an and [petitioner] Rosemarie Magbanua admitted her participation
investigation of a case reported to their office. And Rosemarie therein. There was nothing illegal, sinister or malicious in prosecuting
Magbanua admitted to them her participation to the commission of the her on the part of [herein respondent] Dra. Junsay who, as a victim of
crime together with her co-accused Ernesto Fernandez and Gudo. the crime of robbery, reported the incident to the police authorities. In
Thus, there was probable cause of the crime of robbery against said fact, the [respondent] did not suspect that the [petitioner] was one of
accused. Their finding of a probable cause against the accused was those who committed the crime.
shared by the City Fiscal’s Office when an Information for robbery
against said accused was filed after conducting a preliminary On the part of the police investigators, they were only performing their
investigation. duties in accordance with the standard procedure of their office. They
came to know the victim Dra. Junsay and [petitioner] Rosemarie
[Respondents] police investigators Ibarra Lopez and Juanito Jacela do Magbanua only during the investigation. The fact was that Rosemarie
not know [respondent] Dra.Pilar Junsay nor [petitioner] Rosemarie Magbanua admitted participation in the commission of the crime.
Magbanua, prior to July 18, 1982, when the crime was reported by the Finding that there was a prima facie case, the City Fiscal who
former to their office. And, the criminal complaint filed by them was investigated the case filed a case for robbery in the then Court of First
not only against Rosemarie Magbanua, but also against Ernesto Instance of Bacolod (now RTC).31
Fernandez and a certain "Gudo." Hence, it cannot be said that they
were prompted by a sinister design to vex, and humiliate [petitioner] The Court of Appeals was also convinced that there was probable
Rosemarie Magbanua.30 cause to believe that the robbery was committed by petitioner
Rosemarie and her co-accused. The finding of probable cause,
Petitioners filed a Notice of Appeal on the 25 July 1995 Decision of according to the appellate court, was confirmed by the filing of the
the RTC. Thus, the records of the case were subsequently forwarded Information for Robbery by the City Fiscal’s Office after the
to the Court of Appeals. preliminary investigation.32

The Court of Appeals affirmed the RTC in toto. The Court of Appeals disposed:

The appellate court declared that the design to vex and humiliate WHEREFORE, the Decision of the trial court dated July 25, 1995 is
petitioner Rosemarie in the prosecution of Criminal Case No. 28 was hereby AFFIRMED IN TOTO. Costs against the [herein petitioners]. 33
wanting. It held that respondent Pilar as complaining witness merely
reported the matter to the police authorities; while respondents Ibarra Hence, petitioners come to the succor of this Court via the instant
and Juanito were merely performing their duties as investigating Appeal by Certiorari to assail the Decision of the Court of Appeals,
police officers. Thus: which affirmed the Decision of the RTC, that there was no malicious
prosecution.
For our resolution is the issue of whether petitioners are entitled to "One begun in malice without probable cause to believe the charges
damages for malicious prosecution. However, before we could resolve can be sustained (Eustace v. Dechter, 28 Cal. App. 2d. 706, 83 P. 2d.
said issue, we should first determine whether the filing of a criminal 525). Instituted with intention of injuring defendant and without
case for Robbery against petitioner Rosemarie constituted malicious probable cause, and which terminates in favor of the person
prosecution. prosecuted. For this injury an action on the case lies, called the action
of malicious prosecution (Hicks v. Brantley, 29 S.E. 459, 102 Ga. 264;
It is petitioners’ submission that the prosecution of petitioner Eggett v. Allen, 96 N.W. 803, 119 Wis. 625)."
Rosemarie was founded upon baseless accusations. 34 Petitioners posit
that the charges were based on false affidavits and false police reports, In Philippine jurisdiction, it has been defined as:
without which the criminal case against petitioner Rosemarie would
not have been filed.35 Petitioners further decry the maltreatment which "An action for damages brought by one against whom a criminal
petitioner Rosemarie allegedly suffered from the hands of prosecution, civil suit, or other legal proceeding has been instituted
respondents. According to petitioners, Rosemarie was maltreated to maliciously and without probable cause, after the termination of such
extract a confession from her, and to make her admit to a crime she prosecution, suit, or other proceeding in favor of the defendant therein.
did not commit. They reasoned that petitioner Rosemarie, who was The gist of the action is the putting of legal process in force, regularly,
then a minor, an uneducated farm girl, and a stranger in Bacolod City, for the mere purpose of vexation or injury (Cabasaan v. Anota, 14169-
was subjected to torture and inhumane treatment.36 Petitioners contend R, November 19, 1956)."
further that respondent Pilar employed her privileged status in the
society as a medical doctor; and her co-respondents Ibarra and Juanito The statutory basis for a civil action for damages for malicious
utilized their positions as members of the Bacolod City Police to prosecution are found in the provisions of the New Civil Code on
secure an admission from petitioner Rosemarie. 37 Human Relations and on damages particularly Articles 19, 20, 21, 26,
29, 32, 33, 35, 2217 and 2219 (8). To constitute malicious prosecution,
In this jurisdiction, the term "malicious prosecution" has been defined however, there must be proof that the prosecution was prompted by a
as "an action for damages brought by one against whom a criminal sinister design to vex and humiliate a person, and that it was initiated
prosecution, civil suit, or other legal proceeding has been instituted deliberately by the defendant knowing that his charges were false and
maliciously and without probable cause, after the termination of such groundless. Concededly, the mere act of submitting a case to the
prosecution, suit, or other proceeding in favor of the defendant authorities for prosecution does not make one liable for malicious
therein."38 While generally associated with unfounded criminal prosecution.
actions, the term has been expanded to include unfounded civil suits
instituted just to vex and humiliate the defendant despite the absence This Court has drawn the four elements that must be shown to concur
of a cause of action or probable cause.39 to recover damages for malicious prosecution. Therefore, for a
malicious prosecution suit to prosper, the plaintiff must prove the
This Court, in Drilon v. Court of Appeals, 40 elucidated, viz: following: (1) the prosecution did occur, and the defendant was
himself the prosecutor or that he instigated its commencement; (2) the
The term malicious prosecution has been defined in various ways. In criminal action finally ended with an acquittal; (3) in bringing the
American jurisdiction, it is defined as: action, the prosecutor acted without probable cause; and (4) the
prosecution was impelled by legal malice -- an improper or a sinister Robbery against petitioner Rosemarie showed that she admitted to
motive.41 The gravamen of malicious prosecution is not the filing of a receiving instruction from her co-accused Ernesto Fernandez and a
complaint based on the wrong provision of law, but the deliberate certain Gudo to leave the barrel belt of the kitchen door unlocked,46 so
initiation of an action with the knowledge that the charges were false her co-accused can gain entry to the house of respondent
and groundless.42 Pilar.1avvphi1.net Moreover, she admitted that after her co-accused
had taken the pieces of jewelry owned by respondent Pilar, they gave
We shall proceed to determine whether in the prosecution of petitioner her a necklace which she kept in a shoulder bag. During the
Rosemarie for the crime of Robbery, all four elements were in investigation, she was shown the said necklace, and she positively
attendance. identified the same to be the necklace her co-accused had given
her.47 On the basis of the said admission, the Office of the Prosecutor
It is not disputed that the first and second elements are present. found basis and probable cause to file the appropriate Information with
the RTC against petitioner Rosemarie and her co-accused Ernesto
The prosecution of petitioner Rosemarie for the crime of robbery did Fernandez and a certain Gudo. The inadmissibility of the aforesaid
occur, and respondents Pilar, Ibarra and Juanito instigated its admission on the ground that the same was extracted under duress was
commencement. On 20 December 1985, the RTC, Branch XLI, an evidentiary matter, which does not detract from the fact that based
Bacolod City, rendered a Decision acquitting Rosemarie Magbanua on petitioner Rosemarie’s admission, there was reason for the
on the ground of insufficiency of evidence. respondents to believe that the suit was not unfounded, and that the
crime was committed.
On the question of probable cause, this Court has ruled that for
purposes of malicious prosecution, "probable cause" means "such Finally, in an action to recover damages based on malicious
facts and circumstances as would excite the belief, in a reasonable prosecution, it must be established that the prosecution was impelled
mind, acting on the facts within the knowledge of the prosecutor, that by legal malice. There is necessity of proof that the suit was so patently
the person charged was guilty of the crime for which he was malicious as to warrant the award of damages under Articles 19 to
prosecuted."43 It is merely based on opinion and reasonable 21,48 of the Civil Code, or that the suit was grounded on malice or bad
belief.44 Thus, a finding of probable cause does not require an inquiry faith.49 Moreover, it is a doctrine well-entrenched in jurisprudence that
into whether there is sufficient evidence to procure a conviction.45 the mere act of submitting a case to the authorities for prosecution does
not make one liable for malicious prosecution, for the law would not
Anent the question of whether the prosecutor acted without probable have meant to impose a penalty on the right to litigate. 50 1awphi1.net
cause in bringing the action against petitioner Rosemarie, we find no
reason to depart from the conclusions reached by the RTC and the Applying the rule to the case at bar, we affirm the findings of the RTC
Court of Appeals. The filing of Criminal Case No. 28 for Robbery was and the Court of Appeals that there was no proof of a sinister design
not without probable cause. on the part of the respondents to vex or humiliate petitioner Rosemarie
by instituting the criminal case against her and her co-accused.
Respondent Pilar who was robbed of her valuable belongings can only
Indeed, during the investigation petitioner Rosemarie admitted her
be expected to bring the matter to the authorities. There can be no evil
participation in the commission of the incident complained of. The
investigation report, which prompted the filing of the Information for motive that should be attributed to one, who, as victim of a crime
institutes the necessary legal proceedings. At the risk of redundancy, SO ORDERED.
we stress that the proscription against the imposition of penalty on the
right to litigate must not be violated. Mere filing of a suit does not
render a person liable for malicious prosecution should he be
unsuccessful, for the law could not have meant to impose a penalty on
the right to litigate.51 There was no other explanation or motive as to
why respondents would institute baseless prosecution of petitioner
Rosemarie. No evidence was shown that there was bad blood between
respondent Pilar and petitioner Rosemarie prior to the supposed
robbery.

We also do not find the actuations of respondents Ibarra and Juanito

to be impelled by legal malice. Their commencement of the action
against petitioner Rosemarie and her co-accused was pursuant to their
duties as police officers. The same was made subsequent to the report
of respondent Pilar of the commission of the crime, and the
investigation on the person of petitioner Rosemarie. Even then,
mistakes committed by a public officer are not actionable absent any
clear showing that they were motivated by malice or gross negligence
amounting to bad faith,52 which was not established in the case at bar.

Moreover, as was clear from the outset, the instant case is a suit
seeking damages for malicious prosecution, and not for the violations
and maltreatment that respondents allegedly committed against
petitioner Rosemarie in extracting the admission from her. At any rate,
the RTC had ruled that the instant case is not an action on the injuries
allegedly suffered by petitioner Rosemarie, but rather for malicious
prosecution. Otherwise, an action seeking damages for her injuries
should have been deemed prescribed.53

WHEREFORE, the Appeal is DENIED. The Decision, dated 26

January 1998, of the Court of Appeals in CA-G.R. CV No. 51750,
which affirmed in toto the Decision, dated 25 July 1995, of the RTC,
Branch 51, Bacolod City, in Civil Case No. 4361, is AFFIRMED.
Costs against petitioners.
G.R. No. 141011 July 19, 2001 requisition slip with the obligatory particulars, except for his current
account number which he could not remember. He expressed his
CITYTRUST BANKING CORPORATION (now Bank of the predicament to a lady customer service representative of the BANK,
Philippine Islands), petitioner, who in turn assured him that she could supply the information from
vs. the BANK’s account records. After signing the requisition slip, he
ISAGANI C. VILLANUEVA, respondent. gave it to her.1

x---------------------------------------------------------x Pia Rempillo, another customer service representative of the BANK,

saw VILLANUEVA’s checkbook requisition slip. She took it and
G.R. No. 141028 July 19, 2001 proceeded to check the BANK’s checkbook register which contained
all the names and account numbers of the BANK’s clients who were
ISAGANI C. VILLANUEVA, petitioner, issued checkbooks. Upon seeing the name "Isagani Villanueva --
vs. Account No. 33-00446-3" in the checkbook register, Rempillo copied
CITYTRUST BANKING CORPORATION, respondent. the aforesaid account number on the space intended for it in
VILLANUEVA’s requisition slip.2
DAVIDE, JR., C.J.:
On 17 June 1986, VILLANUEVA received from the BANK his
In these consolidated cases, the Court is called upon to determine requested checkbook. On the same day, he immediately signed Check
whether the repeated dishonor of a check drawn against a well-funded No. 396701 bearing the amount of P50,000 payable to the order of
account but bearing the account number of another depositor with the Kingly Commodities Traders and Multi Resources, Inc. (hereafter
Kingly Commodities). VILLANUEVA thereafter delivered the check
same name and surname as the drawer would entitle the drawer to
to Helen Chu, his investment consultant at Kingly Commodities, with
compensatory and moral damages and to attorney’s fees.
his express instruction to use said check in placing a trading order at
Kingly Commodities’ future trading business as soon as a favorable
The antecedent facts are as follows:
opportunity presented itself.3
Sometime in February 1984, Isagani C. Villanueva (hereafter
Two days later, or on 19 June 1986, VILLANUEVA received a call
VILLANUEVA) opened a savings account and a current account with
from Helen Chu, informing him that she had already placed a trading
Citytrust Banking Corporation (hereafter the BANK), which were
order in his behalf and delivered the check to Kingly Commodities.
assigned account numbers 1-033-02337-1 and 33-00977-5,
The check was deposited with the China Banking Corporation. The
respectively, with an automatic transfer arrangement.
next day, he deposited P31,600 in cash to his savings account to cover
the full amount of the check he issued. His deposits in both accounts
On 21 May 1986, VILLANUEVA deposited some money in his totalled P51,304.91.4
savings account with the BANK’s Legaspi Village Branch in Makati,
Metro Manila. Realizing that he had run out of blank checks,
However, on 23 June 1986, VILLANUEVA’s Check No. 396701 was
VILLANUEVA requested a new checkbook from one of the BANK’s
dishonored due to insufficiency of funds and disparity in the signature.
customer service representatives. He then filled up a checkbook
VILLANUEVA called Kingly Commodities and explained that there To resolve the matter, Genuino promised to send to Kingly
was a mistake in the dishonor of the check because he had sufficient Commodities a manager’s check for P50,000 before 5:30 p.m., the
funds. Forthwith on the same day, VILLANUEVA called up the deadline given to VILLANUEVA. She also personally called Kingly
BANK’s Legaspi Village Branch Operations Manager, Maritess Commodities and explained the reason for the dishonor of the check. 8
Gamboa, and inquired about the dishonor of his well-funded check.
Gamboa promised to look into the matter and instructed On 30 June 1986, VILLANUEVA sent a letter 9 to the BANK
VILLANUEVA to advise his payee, Kingly Commodities, to re- addressed to the President, Jose Facundo, demanding indemnification
deposit the check. Gamboa assured VILLANUEVA that the check for alleged losses and damages suffered by him as a result of the
would be honored after the sufficiency of the funds was ascertained.5 dishonor of his well-funded check. He demanded the amount of
P70,000 as indemnification for actual damages in the form of lost
On 26 June 1986 at about 4:00 p.m., VILLANUEVA learned that his profits and P2 Million for moral and other damages.
check was again dishonored due to insufficiency of funds and a stop-
payment order he allegedly issued. Dismayed by the turn of events, On 10 July 1986, in answer to VILLANUEVA’s letter, Gregorio
VILLANUEVA called up the BANK and inquired from Gamboa the Anonas III, the BANK’s Senior Vice-President, apologized for the
reason for the dishonor of his well-funded check and the alleged stop- unfortunate oversight, but reminded VILLANUEVA that the dishonor
payment order which he never issued. Gamboa promised to of his check was due to his failure to state his current account number
investigate the matter and to call VILLANUEVA in fifteen (15) in his requisition slip. Anonas further stated that as soon as the mistake
minutes.6 In the meantime, she advised VILLANUEVA to re-deposit was discovered, the BANK promptly sent a manager’s check to
the check. Kingly Commodities before 5:30 p.m. on 26 June 1986 to avoid any
damage the dishonor of the check might have caused.10
VILLANUEVA then requested Lawrence Chin of Kingly
Commodities to give him until 5:30 p.m. that same day to make good Failing to obtain from the BANK a favorable action on his demand for
his P50,000 check. He then proceeded to the BANK’s Legaspi Village indemnification, VILLANUEVA filed on 27 August 1986 a complaint
Branch Office, together with his investment consultant and his trading for damages based on breach of contract and/or quasi-delict before the
partner, to personally inquire into the matter. They were met by Regional Trial Court of Makati City. The case was docketed as Civil
Marilou Genuino, the BANK’s Branch Manager. There he Case No. 14749 and was raffled to Branch 63 thereof.
complained that his trading order was rejected because of the dishonor
of the check and that Kingly Commodities threatened to close his VILLANUEVA alleged in his complaint that the BANK breached its
trading account unless his check payment would be made good before contractual obligation to him as a depositor because of its repeated
5:30 p.m. that day. After making the necessary investigation, Genuino dishonor of his valid and well-funded check. The breach arose from
related to VILLANUEVA that the reason for the dishonor of the check the BANK’s gross negligence and culpable recklessness in supplying
was that the account number assigned to his new checkbook was the the wrong account number. As a consequence, he suffered and
account number of another depositor also named "Isagani Villanueva" sustained (1) actual damages consisting of loss of profits in the amount
but with a different middle initial.7 of at least P240,000, for he was not allowed to trade by Kingly
Commodities; and (2) P2 Million as moral damages because of the
intolerable physical inconvenience, discomfort, extreme humiliation,
indignities, etc., that he had borne before his peers and colleagues in top of one of the tables of the BANK; and (e) verify the account
the firm, his trading partners, and the officers of Kingly Commodities. number of the new set of checks when it was delivered to him. These
He prayed for an additional award of P500,000 for exemplary omissions directly resulted in the dishonor of his check drawn from an
damages, attorney’s fees, litigation expenses and costs of the suit. 11 account bearing the account number of another BANK client whose
name and surname were similar to his. VILLANUEVA then must bear
In its answer, the BANK alleged that VILLANUEVA suffered no the consequent damages and losses he allegedly suffered.
actionable injury, much less damages, considering his blatant
irresponsibility in not remembering his current account number and in The trial court conceded, however, that the BANK was negligent when
failing to bring his checkbook re-order slip form on which his account it failed to supply VILLANUEVA’s correct account number despite
number was inscribed when he requested a new set of checks. His its promise to do so; but its negligence was merely contributory, which
negligence in verifying the account number of the new set of checks would have "reduced the damages recoverable" by VILLANUEVA
issued to him also contributed to the dishonor of his check. The BANK had the latter proved his claims for actual, moral and exemplary
claimed that it acted in good faith when it twice dishonored the check. damages, and attorney’s fees.
It further asserted that VILLANUEVA’s negligence was the
proximate cause of his self-proclaimed injury; and the alleged losses Likewise, the trial court doubted that VILLANUEVA sustained actual
and damages could not likewise be deemed the natural and probable damages in the amount of P240,000 due to loss of profits as averred
consequences of the BANK’s breach of obligation, had there been any. in the complaint considering that his initial claim against the BANK
Finally, it claimed that VILLANUEVA acted with malice in filing the for actual loss was merely P70, 00014 and the evidence presented in
case, and interposed counterclaims of P500,000 as exemplary support thereof was hearsay, unreliable and not the best evidence.
damages; P250,000 as attorney’s fees; and actual damages as may be
determined by the court.12 VILLANUEVA appealed to the Court of Appeals. The appeal was
docketed as CA-G.R. CV No. 40931.
After due proceedings, the trial court rendered on 3 July 1992 a
decision13 dismissing the complaint and the compulsory counterclaim In his appeal, VILLANUEVA maintained that the BANK was guilty
for lack of merit. To the trial court, the basic issue was whether it was of gross or culpable negligence amounting to bad faith when its
VILLANUEVA’s or the BANK’s negligence which was the customer service representative furnished an erroneous account
proximate cause of the former’s alleged injury. After an evaluation of number. He further contended that the same was the proximate cause
the respective allegations and evidence of the parties, the trial court of the repeated dishonor of his check. He should, therefore, be entitled
found that VILLANUEVA’s negligence set the chain of events which to an award of actual, moral and exemplary damages, including
resulted in his alleged losses and damages. His negligence consisted attorney’s fees and costs of the suit.
in his failure to (a) indicate his current account number when he filled
up his requisition slip for a new set of checks; (b) remember his The Court of Appeals, in its decision of 2 February 1999, 15 ruled that
account number; (c) bring the used checkbook to which was attached when the BANK voluntarily processed the requisition slip without the
the pre-order requisition slip on which the account number was pre- requisite account number being supplied by the applicant, it in effect
indicated; (d) give the requisition slip to the care and custody of a took upon itself the obligation to supply the correct account number.
BANK officer or employee instead of leaving the requisition slip on Thus, when the new checkbook was released to VILLANUEVA on 17
June 1986, the BANK was deemed to have waived any defect in the In his petition, VILLANUEVA asserts that the Court of Appeals erred
requisition slip and estopped from putting the blame on in holding that his actual losses in the amount of P234,059.04 was not
VILLANUEVA’s failure to indicate his account number. sufficiently proved with reasonable certainty. Had his fully-funded
VILLANUEVA had every right to assume that everything was in check not been dishonored twice, his four trading orders with Kingly
order in his application for a new checkbook; for, after all, he was Commodities consisting of two (2) open sell positions on 17 and 18 of
banking with a world class universal bank. The banking industry is June 1986 and two (2) settle buy orders on 26 June 1986 would have
imbued with public interest and is mandated by law to serve its clients earned him profits in the amount he claimed. He emphatically
with extraordinary care and diligence. maintains that the loss had been satisfactorily proved by the testimony
of Helen Chu, his investment consultant. Ms. Chu’s testimony was not
The Court of Appeals also considered the BANK’s voluntary controverted; hence, it should have been considered and admitted as
processing of the requisition slip as the "cause which in the natural and factually true. Considering that his claim for actual damages has been
continuous sequence, unbroken by any efficient intervening cause, adequately established and that the BANK committed gross
produced the injury and without which the result would not have negligence amounting to bad faith, his concomitant demand for
occurred."16 However, although it conceded that the BANK‘s exemplary damages should likewise be awarded.
negligence was not attended with malice and bad faith, it nonetheless
awarded moral damages in the amount of P100,000. It also awarded The issue of whether VILLANUEVA suffered actual or compensatory
attorney’s fees in the amount of P50,000, since VILLANUEVA was damages in the form of loss of profits is factual. Both the Court of
compelled to incur expenses to protect his interests by reason of the Appeals and the trial court have ascertained that VILLANUEVA was
unjustified act or omission of the BANK. However, it rejected unable to prove his demand for compensatory damages arising from
VILLANUEVA’s claim for compensatory damages and affirmed the loss. His evidence thereon was found inadequate, uncorroborated,
trial court’s finding thereon. speculative, hearsay and not the best evidence. Basic is the
jurisprudential principle that in determining actual damages, the court
Upon the denial17 of their respective motions for reconsideration, both cannot rely on mere assertions, speculations, conjectures or guesswork
VILLANUEVA and the BANK appealed to us by way of petition for but must depend on competent proof and on the best obtainable
review. evidence of the actual amount of the loss.18 Actual damages cannot be
presumed but must be duly proved with reasonable certainty.19
In its petition, the BANK ascribes to the Court of Appeals as reversible
errors its (1) reversal of the court a quo’s decision; (2) declaration that It must also be stressed that the unanimity on the factual ascertainment
the proximate and efficient cause of the injury allegedly suffered by on this point by the trial court and the Court of Appeals bars us from
VILLANUEVA was the BANK’s processing of the checkbook and supplanting their finding and substituting it with our own assessment.
assigning an erroneous account number, and not the negligent act of Well-entrenched in our jurisprudence is the doctrine that the factual
VILLANUEVA in leaving the checkbook requisition slip on top of determinations of the lower courts are conclusive and binding upon
one of the desks with the account number entry blank; and (3) award appellate courts and hence should not be disturbed. None of the
of moral damages and attorney’s fees despite the absence of a finding recognized exceptions to said principle exists in this case to warrant a
of bad faith on the part of the BANK. reexamination of such finding. Besides, our jurisdiction in cases
brought before us from the Court of Appeals is limited to the review account would be closed at 5:30 p.m. on 26 June 1986. The BANK
of errors of law.20 was able to issue a manager’s check in favor of Kingly Commodities
before the deadline. It was able to likewise explain to Kingly
Nonetheless, is VILLANUEVA entitled to the moral damages and Commodities the circumstances surrounding the unfortunate situation.
attorney’s fees granted by the Court of Appeals? Verily, the alleged embarrassment or inconvenience caused to
VILLANUEVA as a result of the incident was timely and adequately
Moral damages include physical suffering, mental anguish, fright, contained, corrected, mitigated, if not entirely eradicated.
serious anxiety, besmirched reputation, wounded feelings, moral VILLANUEVA, thus, failed to support his claim for moral damages.
shock, social humiliation, and similar injury.21 Although incapable of In short, none of the circumstances mentioned in Article 2219 of the
pecuniary computation, moral damages may be recovered if they are Civil Code exists to sanction the award for moral damages.
the proximate result of the defendant’s wrongful act or
omission.22 Thus, case law establishes the requisites for the award of The award of attorney’s fees should likewise be deleted. The general
moral damages, viz: (1) there must be an injury, whether physical, rule is that attorney’s fees cannot be recovered as part of damages
mental or psychological, clearly sustained by the claimant; (2) there because of the policy that no premium should be placed on the right
must be a culpable act or omission factually established; (3) the to litigate. They are not to be awarded every time a party wins a suit.
wrongful act or omission of the defendant is the proximate cause of The power of the court to award attorney’s fees under Article 2208 of
the injury sustained by the claimant; and (4) the award of damages is the Civil Code demands factual, legal and equitable justification. Even
predicated on any of the cases stated in Article 2219 of the Civil when a claimant is compelled to litigate with third persons or to incur
Code. 23 expenses to protect his rights, still attorney’s fees may not be awarded
where there is no sufficient showing of bad faith in the parties’
It is beyond cavil that VILLANUEVA had sufficient funds for the persistence of a case other than an erroneous conviction of the
check. Had his account number been correct, the check would not have righteousness of his cause.24
been dishonored. Hence, we can say that VILLANUEVA’s injury
arose from the dishonor of his well-funded check. We have already In view of the foregoing discussion, we need not deliberate on the
ruled that the dishonor of the check does not entitle him to dispute as to whether it was the BANK’s or VILLANUEVA’s
compensatory damages. But, could the dishonor result in his alleged negligence which was the proximate cause of the latter’s injury
"intolerable physical inconvenience and discomfort, extreme because, in the first place, he did not sustain any compensable injury.
humiliation, indignities, etc, which he had borne before his peers, If any damage had been suffered at all, it could be equivalent
trading partners and officers of Kingly Commodities?" True, we find to damnum absque injuria, i.e., damage without injury or damage or
that under the circumstances of this case, VILLANUEVA might have injury inflicted without injustice, or loss or damage without violation
suffered some form of inconvenience and discomfort as a result of the of a legal right, or a wrong done to a man for which the law provides
dishonor of his check. However, the same could not have been so no remedy. 25
grave or intolerable as he attempts to portray or impress upon us.
WHEREFORE, the decision of the Court of Appeals in CA-G.R. CV
Further, it is clear from the records that the BANK was able to remedy No. 40931 is hereby REVERSED, and the judgment of the Regional
the caveat of Kingly Commodities to VILLANUEVA that his trading Trial Court of Makati City, Branch 63, in Civil Case No. 14749
dismissing the complaint and the counterclaim is hereby
REINSTATED.

No costs.

SO ORDERED.
G.R. No. 124354 December 29, 1999 Plaintiff Erlinda Ramos was, until the afternoon of
June 17, 1985, a 47-year old (Exh. "A") robust
ROGELIO E. RAMOS and ERLINDA RAMOS, in their own woman (TSN, October 19, 1989, p. 10). Except for
behalf and as natural guardians of the minors, ROMMEL occasional complaints of discomfort due to pains
RAMOS, ROY RODERICK RAMOS and RON RAYMOND allegedly caused by the presence of a stone in her gall
RAMOS, petitioners, bladder (TSN, January 13, 1988, pp. 4-5), she was as
vs. normal as any other woman. Married to Rogelio E.
COURT OF APPEALS, DELOS SANTOS MEDICAL CENTER, Ramos, an executive of Philippine Long Distance
DR. ORLINO HOSAKA and DRA. PERFECTA Telephone Company, she has three children whose
GUTIERREZ, respondents. names are Rommel Ramos, Roy Roderick Ramos and
Ron Raymond Ramos (TSN, October 19, 1989, pp. 5-
6).

KAPUNAN, J.: Because the discomforts somehow interfered with her

normal ways, she sought professional advice. She was
The Hippocratic Oath mandates physicians to give primordial advised to undergo an operation for the removal of a
consideration to the health and welfare of their patients. If a doctor stone in her gall bladder (TSN, January 13, 1988, p.
fails to live up to this precept, he is made accountable for his acts. A 5). She underwent a series of examinations which
mistake, through gross negligence or incompetence or plain human included blood and urine tests (Exhs. "A" and "C")
error, may spell the difference between life and death. In this sense, which indicated she was fit for surgery.
the doctor plays God on his patient's fate. 1
Through the intercession of a mutual friend, Dr.
In the case at bar, the Court is called upon to rule whether a surgeon, Buenviaje (TSN, January 13, 1988, p. 7), she and her
an anesthesiologist and a hospital should be made liable for the husband Rogelio met for the first time Dr. Orlino
unfortunate comatose condition of a patient scheduled for Hozaka (should be Hosaka; see TSN, February 20,
cholecystectomy. 2 1990, p. 3), one of the defendants in this case, on June
10, 1985. They agreed that their date at the operating
table at the DLSMC (another defendant), would be on
Petitioners seek the reversal of the decision 3 of the Court of Appeals,
dated 29 May 1995, which overturned the decision 4 of the Regional June 17, 1985 at 9:00 A.M.. Dr. Hosaka decided that
Trial Court, dated 30 January 1992, finding private respondents liable she should undergo a "cholecystectomy" operation
for damages arising from negligence in the performance of their after examining the documents (findings from the
Capitol Medical Center, FEU Hospital and DLSMC)
professional duties towards petitioner Erlinda Ramos resulting in her
comatose condition. presented to him. Rogelio E. Ramos, however, asked
Dr. Hosaka to look for a good anesthesiologist. Dr.
Hosaka, in turn, assured Rogelio that he will get a
The antecedent facts as summarized by the trial court are reproduced
good anesthesiologist. Dr. Hosaka charged a fee of
hereunder:
P16,000.00, which was to include the prospect of a delay in the arrival of Dr. Hosaka.
anesthesiologist's fee and which was to be paid after Herminda then went back to the patient who asked,
the operation (TSN, October 19, 1989, pp. 14-15, 22- "Mindy, wala pa ba ang Doctor"? The former replied,
23, 31-33; TSN, February 27, 1990, p. 13; and TSN, "Huwag kang mag-alaala, darating na iyon" (Ibid.).
November 9, 1989, pp. 3-4, 10, 17).
Thereafter, Herminda went out of the operating room
A day before the scheduled date of operation, she was and informed the patient's husband, Rogelio, that the
admitted at one of the rooms of the DLSMC, located doctor was not yet around (id., p. 13). When she
along E. Rodriguez Avenue, Quezon City (TSN, returned to the operating room, the patient told her,
October 19,1989, p. 11). "Mindy, inip na inip na ako, ikuha mo ako ng ibang
Doctor." So, she went out again and told Rogelio
At around 7:30 A.M. of June 17, 1985 and while still about what the patient said (id., p. 15). Thereafter, she
in her room, she was prepared for the operation by the returned to the operating room.
hospital staff. Her sister-in-law, Herminda Cruz, who
was the Dean of the College of Nursing at the Capitol At around 10:00 A.M., Rogelio E. Ramos was
Medical Center, was also there for moral support. She "already dying [and] waiting for the arrival of the
reiterated her previous request for Herminda to be doctor" even as he did his best to find somebody who
with her even during the operation. After praying, she will allow him to pull out his wife from the operating
was given injections. Her hands were held by room (TSN, October 19, 1989, pp. 19-20). He also
Herminda as they went down from her room to the thought of the feeling of his wife, who was inside the
operating room (TSN, January 13, 1988, pp. 9-11). operating room waiting for the doctor to arrive (ibid.).
Her husband, Rogelio, was also with her (TSN, At almost 12:00 noon, he met Dr. Garcia who
October 19, 1989, p. 18). At the operating room, remarked that he (Dr. Garcia) was also tired of
Herminda saw about two or three nurses and Dr. waiting for Dr. Hosaka to arrive (id., p. 21). While
Perfecta Gutierrez, the other defendant, who was to talking to Dr. Garcia at around 12:10 P.M., he came
administer anesthesia. Although not a member of the to know that Dr. Hosaka arrived as a nurse remarked,
hospital staff, Herminda introduced herself as Dean "Nandiyan na si Dr. Hosaka, dumating na raw." Upon
of the College of Nursing at the Capitol Medical hearing those words, he went down to the lobby and
Center who was to provide moral support to the waited for the operation to be completed (id., pp. 16,
patient, to them. Herminda was allowed to stay inside 29-30).
the operating room.
At about 12:15 P.M., Herminda Cruz, who was inside
At around 9:30 A.M., Dr. Gutierrez reached a nearby the operating room with the patient, heard somebody
phone to look for Dr. Hosaka who was not yet in say that "Dr. Hosaka is already here." She then saw
(TSN, January 13, 1988, pp. 11-12). Dr. Gutierrez people inside the operating room "moving, doing this
thereafter informed Herminda Cruz about the and that, [and] preparing the patient for the operation"
(TSN, January 13, 1988, p. 16). As she held the hand (TSN, January 13, 1988, p. 20). At almost 3:00 P.M.
of Erlinda Ramos, she then saw Dr. Gutierrez of that fateful day, she saw the patient taken to the
intubating the hapless patient. She thereafter heard Intensive Care Unit (ICU).
Dr. Gutierrez say, "ang hirap ma-intubate nito, mali
yata ang pagkakapasok. O lumalaki ang tiyan" (id., p. About two days thereafter, Rogelio E. Ramos was
17). Because of the remarks of Dra. Gutierrez, she able to talk to Dr. Hosaka. The latter informed the
focused her attention on what Dr. Gutierrez was former that something went wrong during the
doing. She thereafter noticed bluish discoloration of intubation. Reacting to what was told to him, Rogelio
the nailbeds of the left hand of the hapless Erlinda reminded the doctor that the condition of his wife
even as Dr. Hosaka approached her. She then heard would not have happened, had he (Dr. Hosaka)
Dr. Hosaka issue an order for someone to call Dr. looked for a good anesthesiologist (TSN, October 19,
Calderon, another anesthesiologist (id., p. 19). After 1989, p. 31).
Dr. Calderon arrived at the operating room, she saw
this anesthesiologist trying to intubate the patient. Doctors Gutierrez and Hosaka were also asked by the
The patient's nailbed became bluish and the patient hospital to explain what happened to the patient. The
was placed in a trendelenburg position — a position doctors explained that the patient had bronchospasm
where the head of the patient is placed in a position (TSN, November 15, 1990, pp. 26-27).
lower than her feet which is an indication that there is
a decrease of blood supply to the patient's brain (Id., Erlinda Ramos stayed at the ICU for a month. About
pp. 19-20). Immediately thereafter, she went out of four months thereafter or on November 15, 1985, the
the operating room, and she told Rogelio E. Ramos patient was released from the hospital.
"that something wrong was . . . happening" (Ibid.).
Dr. Calderon was then able to intubate the patient During the whole period of her confinement, she
(TSN, July 25, 1991, p. 9). incurred hospital bills amounting to P93,542.25
which is the subject of a promissory note and affidavit
Meanwhile, Rogelio, who was outside the operating of undertaking executed by Rogelio E. Ramos in
room, saw a respiratory machine being rushed favor of DLSMC. Since that fateful afternoon of June
towards the door of the operating room. He also saw 17, 1985, she has been in a comatose condition. She
several doctors rushing towards the operating room. cannot do anything. She cannot move any part of her
When informed by Herminda Cruz that something body. She cannot see or hear. She is living on
wrong was happening, he told her (Herminda) to be mechanical means. She suffered brain damage as a
back with the patient inside the operating room (TSN, result of the absence of oxygen in her brain for four
October 19, 1989, pp. 25-28). to five minutes (TSN, November 9, 1989, pp. 21-22).
After being discharged from the hospital, she has
Herminda Cruz immediately rushed back, and saw been staying in their residence, still needing constant
that the patient was still in trendelenburg position medical attention, with her husband Rogelio incurring
 a monthly expense ranging from P8,000.00 to only intubating the patient, but also in not repeating
P10,000.00 (TSN, October 19, 1989, pp. 32-34). She the administration of atropine (TSN, August 20,
was also diagnosed to be suffering from "diffuse 1991, pp. 5-10), without due regard to the fact that the
cerebral parenchymal damage" (Exh. "G"; see patient was inside the operating room for almost three
also TSN, December 21, 1989, (3) hours. For after she committed a mistake in
p. 6). 5 intubating [the] patient, the patient's nailbed became
bluish and the patient, thereafter, was placed in
Thus, on 8 January 1986, petitioners filed a civil case 6 for damages trendelenburg position, because of the decrease of
with the Regional Trial Court of Quezon City against herein private blood supply to the patient's brain. The evidence
respondents alleging negligence in the management and care of further shows that the hapless patient suffered brain
Erlinda Ramos. damage because of the absence of oxygen in her
(patient's) brain for approximately four to five
During the trial, both parties presented evidence as to the possible minutes which, in turn, caused the patient to become
cause of Erlinda's injury. Plaintiff presented the testimonies of Dean comatose.
Herminda Cruz and Dr. Mariano Gavino to prove that the sustained
by Erlinda was due to lack of oxygen in her brain caused by the faulty On the part of Dr. Orlino Hosaka, this Court finds that
management of her airway by private respondents during the he is liable for the acts of Dr. Perfecta Gutierrez
anesthesia phase. On the other hand, private respondents primarily whom he had chosen to administer anesthesia on the
relied on the expert testimony of Dr. Eduardo Jamora, a patient as part of his obligation to provide the patient
pulmonologist, to the effect that the cause of brain damage was a good anesthesiologist', and for arriving for the
Erlinda's allergic reaction to the anesthetic agent, Thiopental Sodium scheduled operation almost three (3) hours late.
(Pentothal).
On the part of DLSMC (the hospital), this Court finds
After considering the evidence from both sides, the Regional Trial that it is liable for the acts of negligence of the doctors
Court rendered judgment in favor of petitioners, to wit: in their "practice of medicine" in the operating room.
Moreover, the hospital is liable for failing through its
After evaluating the evidence as shown in the finding responsible officials, to cancel the scheduled
of facts set forth earlier, and applying the aforecited operation after Dr. Hosaka inexcusably failed to
provisions of law and jurisprudence to the case at bar, arrive on time.
this Court finds and so holds that defendants are liable
to plaintiffs for damages. The defendants were guilty In having held thus, this Court rejects the defense
of, at the very least, negligence in the performance of raised by defendants that they have acted with due
their duty to plaintiff-patient Erlinda Ramos. care and prudence in rendering medical services to
plaintiff-patient. For if the patient was properly
On the part of Dr. Perfecta Gutierrez, this Court finds intubated as claimed by them, the patient would not
that she omitted to exercise reasonable care in not have become comatose. And, the fact that another
anesthesiologist was called to try to intubate the Private respondents seasonably interposed an appeal to the Court of
patient after her (the patient's) nailbed turned bluish, Appeals. The appellate court rendered a Decision, dated 29 May 1995,
belie their claim. Furthermore, the defendants should reversing the findings of the trial court. The decretal portion of the
have rescheduled the operation to a later date. This, decision of the appellate court reads:
they should have done, if defendants acted with due
care and prudence as the patient's case was an WHEREFORE, for the foregoing premises the
elective, not an emergency case. appealed decision is hereby REVERSED, and the
complaint below against the appellants is hereby
xxx xxx xxx ordered DISMISSED. The counterclaim of appellant
De Los Santos Medical Center is GRANTED but
WHEREFORE, and in view of the foregoing, only insofar as appellees are hereby ordered to pay the
judgment is rendered in favor of the plaintiffs and unpaid hospital bills amounting to P93,542.25, plus
against the defendants. Accordingly, the latter are legal interest for justice must be tempered with
ordered to pay, jointly and severally, the former the mercy.
following sums of money, to wit:
SO ORDERED. 8
1) the sum of P8,000.00 as actual
monthly expenses for the plaintiff The decision of the Court of Appeals was received on 9 June 1995 by
Erlinda Ramos reckoned from petitioner Rogelio Ramos who was mistakenly addressed as "Atty.
November 15, 1985 or in the total Rogelio Ramos." No copy of the decision, however, was sent nor
sum of P632,000.00 as of April 15, received by the Coronel Law Office, then counsel on record of
1992, subject to its being updated; petitioners. Rogelio referred the decision of the appellate court to a
new lawyer, Atty. Ligsay, only on 20 June 1995, or four (4) days
2) the sum of P100,000.00 as before the expiration of the reglementary period for filing a motion for
reasonable attorney's fees; reconsideration. On the same day, Atty. Ligsay, filed with the
appellate court a motion for extension of time to file a motion for
3) the sum of P800,000.00 by way of reconsideration. The motion for reconsideration was submitted on 4
moral damages and the further sum July 1995. However, the appellate court denied the motion for
of P200,000,00 by way of exemplary extension of time in its Resolution dated 25 July 1995. 9 Meanwhile,
damages; and, petitioners engaged the services of another counsel, Atty. Sillano, to
replace Atty. Ligsay. Atty. Sillano filed on 7 August 1995 a motion to
4) the costs of the suit. admit the motion for reconsideration contending that the period to file
the appropriate pleading on the assailed decision had not yet
commenced to run as the Division Clerk of Court of the Court of
SO ORDERED. 7
Appeals had not yet served a copy thereof to the counsel on record.
Despite this explanation, the appellate court still denied the motion to
admit the motion for reconsideration of petitioners in its Resolution, Petitioners assail the decision of the Court of Appeals on the following
dated 29 March 1996, primarily on the ground that the fifteen-day (15) grounds:
period for filing a motion for reconsideration had already expired, to
wit: I

We said in our Resolution on July 25, 1995, that the IN PUTTING MUCH RELIANCE ON THE
filing of a Motion for Reconsideration cannot be TESTIMONIES OF RESPONDENTS DRA.
extended; precisely, the Motion for Extension (Rollo, GUTIERREZ, DRA. CALDERON AND DR.
p. 12) was denied. It is, on the other hand, admitted in JAMORA;
the latter Motion that plaintiffs/appellees received a
copy of the decision as early as June 9, 1995. II
Computation wise, the period to file a Motion for
Reconsideration expired on June 24. The Motion for IN FINDING THAT THE NEGLIGENCE OF THE
Reconsideration, in turn, was received by the Court of RESPONDENTS DID NOT CAUSE THE
Appeals already on July 4, necessarily, the 15-day UNFORTUNATE COMATOSE CONDITION OF
period already passed. For that alone, the latter should PETITIONER ERLINDA RAMOS;
be denied.
III
Even assuming admissibility of the Motion for the
Reconsideration, but after considering the IN NOT APPLYING THE DOCTRINE OF RES
Comment/Opposition, the former, for lack of merit, is
IPSA LOQUITUR. 11
hereby DENIED.
Before we discuss the merits of the case, we shall first dispose of the
SO ORDERED. 10 procedural issue on the timeliness of the petition in relation to the
motion for reconsideration filed by petitioners with the Court of
A copy of the above resolution was received by Atty. Sillano on 11 Appeals. In their
April 1996. The next day, or on 12 April 1996, Atty. Sillano filed 12
Comment, private respondents contend that the petition should not
before this Court a motion for extension of time to file the present be given due course since the motion for reconsideration of the
petition for certiorari under Rule 45. The Court granted the motion petitioners on the decision of the Court of Appeals was validly
for extension of time and gave petitioners additional thirty (30) days dismissed by the appellate court for having been filed beyond the
after the expiration of the fifteen-day (15) period counted from the reglementary period. We do not agree.
receipt of the resolution of the Court of Appeals within which to
submit the petition. The due date fell on 27 May 1996. The petition A careful review of the records reveals that the reason behind the delay
was filed on 9 May 1996, well within the extended period given by the in filing the motion for reconsideration is attributable to the fact that
Court. the decision of the Court of Appeals was not sent to then counsel on
record of petitioners, the Coronel Law Office. In fact, a copy of the
decision of the appellate court was instead sent to and received by a presumption of negligence, or make out a plaintiff's prima facie case,
petitioner Rogelio Ramos on 9 June 1995 wherein he was mistakenly and present a question of fact for defendant to meet with an
addressed as Atty. Rogelio Ramos. Based on the other explanation. 13 Where the thing which caused the injury complained
communications received by petitioner Rogelio Ramos, the appellate of is shown to be under the management of the defendant or his
court apparently mistook him for the counsel on record. Thus, no copy servants and the accident is such as in ordinary course of things does
of the decision of the counsel on record. Petitioner, not being a lawyer not happen if those who have its management or control use proper
and unaware of the prescriptive period for filing a motion for care, it affords reasonable evidence, in the absence of explanation by
reconsideration, referred the same to a legal counsel only on 20 June the defendant, that the accident arose from or was caused by the
1995. defendant's want of care. 14

It is elementary that when a party is represented by counsel, all notices The doctrine of res ipsa loquitur is simply a recognition of the
should be sent to the party's lawyer at his given address. With a few postulate that, as a matter of common knowledge and experience, the
exceptions, notice to a litigant without notice to his counsel on record very nature of certain types of occurrences may justify an inference of
is no notice at all. In the present case, since a copy of the decision of negligence on the part of the person who controls the instrumentality
the appellate court was not sent to the counsel on record of petitioner, causing the injury in the absence of some explanation by the defendant
there can be no sufficient notice to speak of. Hence, the delay in the who is charged with negligence. 15 It is grounded in the superior logic
filing of the motion for reconsideration cannot be taken against of ordinary human experience and on the basis of such experience or
petitioner. Moreover, since the Court of Appeals already issued a common knowledge, negligence may be deduced from the mere
second Resolution, dated 29 March 1996, which superseded the earlier occurrence of the accident itself. 16 Hence, res ipsa loquitur is applied
resolution issued on 25 July 1995, and denied the motion for in conjunction with the doctrine of common knowledge.
reconsideration of petitioner, we believed that the receipt of the former
should be considered in determining the timeliness of the filing of the However, much has been said that res ipsa loquitur is not a rule of
present petition. Based on this, the petition before us was submitted substantive law and, as such, does not create or constitute an
on time. independent or separate ground of liability. 17 Instead, it is considered
as merely evidentiary or in the nature of a procedural rule. 18 It is
After resolving the foregoing procedural issue, we shall now look into regarded as a mode of proof, or a mere procedural of convenience
the merits of the case. For a more logical presentation of the discussion since it furnishes a substitute for, and relieves a plaintiff of, the burden
we shall first consider the issue on the applicability of the doctrine of producing specific proof of negligence. 19 In other words, mere
of res ipsa loquitur to the instant case. Thereafter, the first two invocation and application of the doctrine does not dispense with the
assigned errors shall be tackled in relation to the res ipsa requirement of proof of negligence. It is simply a step in the process
loquitur doctrine. of such proof, permitting the plaintiff to present along with the proof
of the accident, enough of the attending circumstances to invoke the
Res ipsa loquitur is a Latin phrase which literally means "the thing or doctrine, creating an inference or presumption of negligence, and to
the transaction speaks for itself." The phrase "res ipsa loquitur'' is a thereby place on the defendant the burden of going forward with the
maxim for the rule that the fact of the occurrence of an injury, taken proof. 20 Still, before resort to the doctrine may be allowed, the
with the surrounding circumstances, may permit an inference or raise following requisites must be satisfactorily shown:
 1. The accident is of a kind which clearly within the domain of medical science, and not to matters that
ordinarily does not occur in the are within the common knowledge of mankind which may be testified
absence of someone's negligence; to by anyone familiar with the facts. 28 Ordinarily, only physicians and
surgeons of skill and experience are competent to testify as to whether
2. It is caused by an instrumentality a patient has been treated or operated upon with a reasonable degree
within the exclusive control of the of skill and care. However, testimony as to the statements and acts of
defendant or defendants; and physicians and surgeons, external appearances, and manifest
conditions which are observable by any one may be given by non-
3. The possibility of contributing expert witnesses. 29 Hence, in cases where the res ipsa loquitur is
conduct which would make the applicable, the court is permitted to find a physician negligent upon
plaintiff responsible is eliminated. 21 proper proof of injury to the patient, without the aid of expert
testimony, where the court from its fund of common knowledge can
In the above requisites, the fundamental element is the "control of determine the proper standard of care. 30 Where common knowledge
instrumentality" which caused the damage. 22 Such element of control and experience teach that a resulting injury would not have occurred
must be shown to be within the dominion of the defendant. In order to to the patient if due care had been exercised, an inference of
have the benefit of the rule, a plaintiff, in addition to proving injury or negligence may be drawn giving rise to an application of the doctrine
damage, must show a situation where it is applicable, and must of res ipsa loquitur without medical evidence, which is ordinarily
establish that the essential elements of the doctrine were present in a required to show not only what occurred but how and why it
particular incident. 23 occurred. 31 When the doctrine is appropriate, all that the patient must
do is prove a nexus between the particular act or omission complained
Medical malpractice 24 cases do not escape the application of this of and the injury sustained while under the custody and management
doctrine. Thus, res ipsa loquitur has been applied when the of the defendant without need to produce expert medical testimony to
circumstances attendant upon the harm are themselves of such a establish the standard of care. Resort to res ipsa loquitur is allowed
character as to justify an inference of negligence as the cause of that because there is no other way, under usual and ordinary conditions, by
harm. 25 The application of res ipsa loquitur in medical negligence which the patient can obtain redress for injury suffered by him.
cases presents a question of law since it is a judicial function to
determine whether a certain set of circumstances does, as a matter of Thus, courts of other jurisdictions have applied the doctrine in the
law, permit a given inference. 26 following situations: leaving of a foreign object in the body of the
patient after an operation, 32 injuries sustained on a healthy part of the
body which was not under, or in the area, of treatment, 33 removal of
Although generally, expert medical testimony is relied upon in
malpractice suits to prove that a physician has done a negligent act or the wrong part of the body when another part was
that he has deviated from the standard medical procedure, when the intended, 34 knocking out a tooth while a patient's jaw was under
doctrine of res ipsa loquitur is availed by the plaintiff, the need for anesthetic for the removal of his tonsils, 35 and loss of an eye while the
expert medical testimony is dispensed with because the injury itself patient plaintiff was under the influence of anesthetic, during or
provides the proof of negligence. 27 The reason is that the general rule following an operation for appendicitis, 36 among others.
on the necessity of expert testimony applies only to such matters
Nevertheless, despite the fact that the scope of res ipsa loquitur has her brain prior to a scheduled gall bladder operation presents a case
been measurably enlarged, it does not automatically apply to all cases for the application of res ipsa loquitur.
of medical negligence as to mechanically shift the burden of proof to
the defendant to show that he is not guilty of the ascribed A case strikingly similar to the one before us is Voss
negligence. Res ipsa loquitur is not a rigid or ordinary doctrine to be vs. Bridwell, 43 where the Kansas Supreme Court in applying the res
perfunctorily used but a rule to be cautiously applied, depending upon ipsa loquitur stated:
the circumstances of each case. It is generally restricted to situations
in malpractice cases where a layman is able to say, as a matter of The plaintiff herein submitted himself for a mastoid
common knowledge and observation, that the consequences of operation and delivered his person over to the care,
professional care were not as such as would ordinarily have followed custody and control of his physician who had
if due care had been complete and exclusive control over him, but the
exercised. 37 A distinction must be made between the failure to secure operation was never performed. At the time of
results, and the occurrence of something more unusual and not submission he was neurologically sound and
ordinarily found if the service or treatment rendered followed the usual physically fit in mind and body, but he suffered
procedure of those skilled in that particular practice. It must be irreparable damage and injury rendering him
conceded that the doctrine of res ipsa loquitur can have no application decerebrate and totally incapacitated. The injury was
in a suit against a physician or surgeon which involves the merits of a one which does not ordinarily occur in the process of
diagnosis or of a scientific treatment. 38 The physician or surgeon is a mastoid operation or in the absence of negligence in
not required at his peril to explain why any particular diagnosis was the administration of an anesthetic, and in the use and
not correct, or why any particular scientific treatment did not produce employment of an endoctracheal tube. Ordinarily a
the desired result. 39 Thus, res ipsa loquitur is not available in a person being put under anesthesia is not rendered
malpractice suit if the only showing is that the desired result of an decerebrate as a consequence of administering such
operation or treatment was not accomplished. 40 The real question, anesthesia in the absence of negligence. Upon these
therefore, is whether or not in the process of the operation any facts and under these circumstances a layman would
extraordinary incident or unusual event outside of the routine be able to say, as a matter of common knowledge and
performance occurred which is beyond the regular scope of customary observation, that the consequences of professional
professional activity in such operations, which, if unexplained would treatment were not as such as would ordinarily have
themselves reasonably speak to the average man as the negligent cause followed if due care had been exercised.
or causes of the untoward consequence. 41 If there was such extraneous
interventions, the doctrine of res ipsa loquitur may be utilized and the Here the plaintiff could not have been guilty of
defendant is called upon to explain the matter, by evidence of contributory negligence because he was under the
exculpation, if he could. 42 influence of anesthetics and unconscious, and the
circumstances are such that the true explanation of
We find the doctrine of res ipsa loquitur appropriate in the case at bar. event is more accessible to the defendants than to the
As will hereinafter be explained, the damage sustained by Erlinda in plaintiff for they had the exclusive control of the
instrumentalities of anesthesia.
 Upon all the facts, conditions and circumstances observation, if negligence attended the management and care of the
alleged in Count II it is held that a cause of action is patient. Moreover, the liability of the physicians and the hospital in
stated under the doctrine of res ipsa loquitur. 44 this case is not predicated upon an alleged failure to secure the desired
results of an operation nor on an alleged lack of skill in the diagnosis
Indeed, the principles enunciated in the aforequoted case apply with or treatment as in fact no operation or treatment was ever performed
equal force here. In the present case, Erlinda submitted herself for on Erlinda. Thus, upon all these initial determination a case is made
cholecystectomy and expected a routine general surgery to be out for the application of the doctrine of res ipsa loquitur.
performed on her gall bladder. On that fateful day she delivered her
person over to the care, custody and control of private respondents Nonetheless, in holding that res ipsa loquitur is available to the present
who exercised complete and exclusive control over her. At the time of case we are not saying that the doctrine is applicable in any and all
submission, Erlinda was neurologically sound and, except for a few cases where injury occurs to a patient while under anesthesia, or to any
minor discomforts, was likewise physically fit in mind and body. and all anesthesia cases. Each case must be viewed in its own light and
However, during the administration of anesthesia and prior to the scrutinized in order to be within the res ipsa loquitur coverage.
performance of cholecystectomy she suffered irreparable damage to
her brain. Thus, without undergoing surgery, she went out of the Having in mind the applicability of the res ipsa loquitur doctrine and
operating room already decerebrate and totally incapacitated. the presumption of negligence allowed therein, the Court now comes
Obviously, brain damage, which Erlinda sustained, is an injury which to the issue of whether the Court of Appeals erred in finding that
does not normally occur in the process of a gall bladder operation. In private respondents were not negligent in the care of Erlinda during
fact, this kind of situation does not in the absence of negligence of the anesthesia phase of the operation and, if in the affirmative, whether
someone in the administration of anesthesia and in the use of the alleged negligence was the proximate cause of Erlinda's comatose
endotracheal tube. Normally, a person being put under anesthesia is condition. Corollary thereto, we shall also determine if the Court of
not rendered decerebrate as a consequence of administering such Appeals erred in relying on the testimonies of the witnesses for the
anesthesia if the proper procedure was followed. Furthermore, the private respondents.
instruments used in the administration of anesthesia, including the
endotracheal tube, were all under the exclusive control of private In sustaining the position of private respondents, the Court of Appeals
respondents, who are the physicians-in-charge. Likewise, petitioner relied on the testimonies of Dra. Gutierrez, Dra. Calderon and Dr.
Erlinda could not have been guilty of contributory negligence because Jamora. In giving weight to the testimony of Dra. Gutierrez, the Court
she was under the influence of anesthetics which rendered her of Appeals rationalized that she was candid enough to admit that she
unconscious. experienced some difficulty in the endotracheal intubation 45 of the
patient and thus, cannot be said to be covering her negligence with
Considering that a sound and unaffected member of the body (the falsehood. The appellate court likewise opined that private
brain) is injured or destroyed while the patient is unconscious and respondents were able to show that the brain damage sustained by
under the immediate and exclusive control of the physicians, we hold Erlinda was not caused by the alleged faulty intubation but was due to
that a practical administration of justice dictates the application of res the allergic reaction of the patient to the drug Thiopental Sodium
ipsa loquitur. Upon these facts and under these circumstances the (Pentothal), a short-acting barbiturate, as testified on by their expert
Court would be able to say, as a matter of common knowledge and witness, Dr. Jamora. On the other hand, the appellate court rejected
the testimony of Dean Herminda Cruz offered in favor of petitioners A: In particular, I could see that she
that the cause of the brain injury was traceable to the wrongful was intubating the patient.
insertion of the tube since the latter, being a nurse, was allegedly not
knowledgeable in the process of intubation. In so holding, the Q: Do you know what happened to
appellate court returned a verdict in favor of respondents physicians that intubation process administered
and hospital and absolved them of any liability towards Erlinda and by Dra. Gutierrez?
her family.
ATTY. ALCERA:
We disagree with the findings of the Court of Appeals. We hold that
private respondents were unable to disprove the presumption of She will be incompetent Your
negligence on their part in the care of Erlinda and their negligence was Honor.
the proximate cause of her piteous condition.
COURT:
In the instant case, the records are helpful in furnishing not only the
logical scientific evidence of the pathogenesis of the injury but also in Witness may answer if she knows.
providing the Court the legal nexus upon which liability is based. As
will be shown hereinafter, private respondents' own testimonies which A: As have said, I was with the
are reflected in the transcript of stenographic notes are replete of patient, I was beside the stretcher
signposts indicative of their negligence in the care and management holding the left hand of the patient
of Erlinda. and all of a sudden heard some
remarks coming from Dra. Perfecta
With regard to Dra. Gutierrez, we find her negligent in the care of Gutierrez herself. She was saying
Erlinda during the anesthesia phase. As borne by the records, "Ang hirap ma-intubate nito, mali
respondent Dra. Gutierrez failed to properly intubate the patient. This yata ang pagkakapasok. O lumalaki
fact was attested to by Prof. Herminda Cruz, Dean of the Capitol ang tiyan.
Medical Center School of Nursing and petitioner's sister-in-law, who
was in the operating room right beside the patient when the tragic
xxx xxx xxx
event occurred. Witness Cruz testified to this effect:
ATTY. PAJARES:
ATTY. PAJARES:
Q: From whom did you hear those
Q: In particular, what did Dra.
words "lumalaki ang tiyan"?
Perfecta Gutierrez do, if any on the
patient?
A: From Dra. Perfecta Gutierrez.
xxx xxx xxx A: When Dr. Calderon try (sic) to
intubate the patient, after a while the
Q: After hearing the phrase patient's nailbed became bluish and I
"lumalaki ang tiyan," what did you saw the patient was placed in
notice on the person of the patient? trendelenburg position.

A: I notice (sic) some bluish xxx xxx xxx

discoloration on the nailbeds of the
left hand where I was at. Q: Do you know the reason why the
patient was placed in that
Q: Where was Dr. Orlino Ho[s]aka trendelenburg position?
then at that particular time?
A: As far as I know, when a patient
A: I saw him approaching the patient is in that position, there is a decrease
during that time. of blood supply to the brain. 46

Q: When he approached the patient, xxx xxx xxx

what did he do, if any?
The appellate court, however, disbelieved Dean Cruz's testimony in
A: He made an order to call on the the trial court by declaring that:
anesthesiologist in the person of Dr.
Calderon. A perusal of the standard nursing curriculum in our
country will show that intubation is not taught as part
Q: Did Dr. Calderon, upon being of nursing procedures and techniques. Indeed, we
called, arrive inside the operating take judicial notice of the fact that nurses do not, and
room? cannot, intubate. Even on the assumption that she is
fully capable of determining whether or not a patient
A: Yes sir. is properly intubated, witness Herminda Cruz,
admittedly, did not peep into the throat of the patient.
Q: What did [s]he do, if any? (TSN, July 25, 1991, p. 13). More importantly, there
is no evidence that she ever auscultated the patient or
that she conducted any type of examination to check
A: [S]he tried to intubate the patient.
if the endotracheal tube was in its proper place, and to
determine the condition of the heart, lungs, and other
Q: What happened to the patient?
organs. Thus, witness Cruz's categorical statements
that appellant Dra. Gutierrez failed to intubate the
 appellee Erlinda Ramos and that it was Dra. Calderon same were delivered in a straightforward manner, with the kind of
who succeeded in doing so clearly suffer from lack of detail, clarity, consistency and spontaneity which would have been
sufficient factual bases. 47 difficult to fabricate. With her clinical background as a nurse, the
Court is satisfied that she was able to demonstrate through her
In other words, what the Court of Appeals is trying to impress is that testimony what truly transpired on that fateful day.
being a nurse, and considered a layman in the process of intubation,
witness Cruz is not competent to testify on whether or not the Most of all, her testimony was affirmed by no less than respondent
intubation was a success. Dra. Gutierrez who admitted that she experienced difficulty in
inserting the tube into Erlinda's trachea, to wit:
We do not agree with the above reasoning of the appellate court.
Although witness Cruz is not an anesthesiologist, she can very well ATTY. LIGSAY:
testify upon matters on which she is capable of observing such as, the
statements and acts of the physician and surgeon, external Q: In this particular case, Doctora,
appearances, and manifest conditions which are observable by any while you were intubating at your
one. 48 This is precisely allowed under the doctrine of res ipsa first attempt (sic), you did not
loquitur where the testimony of expert witnesses is not required. It is immediately see the trachea?
the accepted rule that expert testimony is not necessary for the proof
of negligence in non-technical matters or those of which an ordinary DRA. GUTIERREZ:
person may be expected to have knowledge, or where the lack of skill
or want of care is so obvious as to render expert testimony A: Yes sir.
unnecessary. 49 We take judicial notice of the fact that anesthesia
procedures have become so common, that even an ordinary person can Q: Did you pull away the tube
tell if it was administered properly. As such, it would not be too immediately?
difficult to tell if the tube was properly inserted. This kind of
observation, we believe, does not require a medical degree to be
A: You do not pull the . . .
acceptable.
Q: Did you or did you not?
At any rate, without doubt, petitioner's witness, an experienced
clinical nurse whose long experience and scholarship led to her
appointment as Dean of the Capitol Medical Center School at Nursing, A: I did not pull the tube.
was fully capable of determining whether or not the intubation was a
success. She had extensive clinical experience starting as a staff nurse Q: When you said "mahirap yata ito,"
in Chicago, Illinois; staff nurse and clinical instructor in a teaching what were you referring to?
hospital, the FEU-NRMF; Dean of the Laguna College of Nursing in
San Pablo City; and then Dean of the Capitol Medical Center School A: "Mahirap yata itong i-intubate,"
of Nursing. 50 Reviewing witness Cruz' statements, we find that the that was the patient.
 Q: So, you found some difficulty in that could make tracheal intubation difficult should be
inserting the tube? studied. 57 Where the need arises, as when initial assessment indicates
possible problems (such as the alleged short neck and protruding teeth
A: Yes, because of (sic) my first of Erlinda) a thorough examination of the patient's airway would go a
attempt, I did not see right away. 51 long way towards decreasing patient morbidity and mortality.

Curiously in the case at bar, respondent Dra. Gutierrez made the In the case at bar, respondent Dra. Gutierrez admitted that she saw
haphazard defense that she encountered hardship in the insertion of Erlinda for the first time on the day of the operation itself, on 17 June
the tube in the trachea of Erlinda because it was positioned more 1985. Before this date, no prior consultations with, or pre-operative
anteriorly (slightly deviated from the normal anatomy of a evaluation of Erlinda was done by her. Until the day of the operation,
person) 52 making it harder to locate and, since Erlinda is obese and respondent Dra. Gutierrez was unaware of the physiological make-up
has a short neck and protruding teeth, it made intubation even more and needs of Erlinda. She was likewise not properly informed of the
difficult. possible difficulties she would face during the administration of
anesthesia to Erlinda. Respondent Dra. Gutierrez' act of seeing her
The argument does not convince us. If this was indeed observed, patient for the first time only an hour before the scheduled operative
private respondents adduced no evidence demonstrating that they procedure was, therefore, an act of exceptional negligence and
proceeded to make a thorough assessment of Erlinda's airway, prior to professional irresponsibility. The measures cautioning prudence and
the induction of anesthesia, even if this would mean postponing the vigilance in dealing with human lives lie at the core of the physician's
procedure. From their testimonies, it appears that the observation was centuries-old Hippocratic Oath. Her failure to follow this medical
made only as an afterthought, as a means of defense. procedure is, therefore, a clear indicia of her negligence.

The pre-operative evaluation of a patient prior to the administration of Respondent Dra. Gutierrez, however, attempts to gloss over this
anesthesia is universally observed to lessen the possibility of omission by playing around with the trial court's ignorance of clinical
anesthetic accidents. Pre-operative evaluation and preparation for procedure, hoping that she could get away with it. Respondent Dra.
anesthesia begins when the anesthesiologist reviews the patient's Gutierrez tried to muddle the difference between an elective surgery
medical records and visits with the patient, traditionally, the day and an emergency surgery just so her failure to perform the required
before elective surgery. 53 It includes taking the patient's medical pre-operative evaluation would escape unnoticed. In her testimony she
history, review of current drug therapy, physical examination and asserted:
interpretation of laboratory data. 54 The physical examination
performed by the anesthesiologist is directed primarily toward the ATTY. LIGSAY:
central nervous system, cardiovascular system, lungs and upper
airway. 55 A thorough analysis of the patient's airway normally Q: Would you agree, Doctor, that it
involves investigating the following: cervical spine mobility, is good medical practice to see the
temporomandibular mobility, prominent central incisors, diseased or patient a day before so you can
artificial teeth, ability to visualize uvula and the thyromental introduce yourself to establish good
distance. 56 Thus, physical characteristics of the patient's upper airway doctor-patient relationship and gain
 the trust and confidence of the Having established that respondent Dra. Gutierrez failed to perform
patient? pre-operative evaluation of the patient which, in turn, resulted to a
wrongful intubation, we now determine if the faulty intubation is truly
DRA. GUTIERREZ: the proximate cause of Erlinda's comatose condition.

A: As I said in my previous Private respondents repeatedly hammered the view that the cerebral
statement, it depends on the anoxia which led to Erlinda's coma was due to
operative procedure of the bronchospasm 59 mediated by her allergic response to the drug,
anesthesiologist and in my case, with Thiopental Sodium, introduced into her system. Towards this end,
elective cases and normal cardio- they presented Dr. Jamora, a Fellow of the Philippine College of
pulmonary clearance like that, I Physicians and Diplomate of the Philippine Specialty Board of
usually don't do it except on Internal Medicine, who advanced private respondents' theory that the
emergency and on cases that have an oxygen deprivation which led to anoxic encephalopathy, 60 was due to
abnormalities (sic). 58 an unpredictable drug reaction to the short-acting barbiturate. We find
the theory of private respondents unacceptable.
However, the exact opposite is true. In an emergency procedure, there
is hardly enough time available for the fastidious demands of pre- First of all, Dr. Jamora cannot be considered an authority in the field
operative procedure so that an anesthesiologist is able to see the of anesthesiology simply because he is not an anesthesiologist. Since
patient only a few minutes before surgery, if at all. Elective Dr. Jamora is a pulmonologist, he could not have been capable of
procedures, on the other hand, are operative procedures that can wait properly enlightening the court about anesthesia practice and
for days, weeks or even months. Hence, in these cases, the procedure and their complications. Dr. Jamora is likewise not an
anesthesiologist possesses the luxury of time to be at the patient's allergologist and could not therefore properly advance expert opinion
beside to do a proper interview and clinical evaluation. There is ample on allergic-mediated processes. Moreover, he is not a pharmacologist
time to explain the method of anesthesia, the drugs to be used, and and, as such, could not have been capable, as an expert would, of
their possible hazards for purposes of informed consent. Usually, the explaining to the court the pharmacologic and toxic effects of the
pre-operative assessment is conducted at least one day before the supposed culprit, Thiopental Sodium (Pentothal).
intended surgery, when the patient is relaxed and cooperative.
The inappropriateness and absurdity of accepting Dr. Jamora's
Erlinda's case was elective and this was known to respondent Dra. testimony as an expert witness in the anesthetic practice of Pentothal
Gutierrez. Thus, she had all the time to make a thorough evaluation of administration is further supported by his own admission that he
Erlinda's case prior to the operation and prepare her for anesthesia. formulated his opinions on the drug not from the practical experience
However, she never saw the patient at the bedside. She herself gained by a specialist or expert in the administration and use of
admitted that she had seen petitioner only in the operating room, and Sodium Pentothal on patients, but only from reading certain
only on the actual date of the cholecystectomy. She negligently failed references, to wit:
to take advantage of this important opportunity. As such, her attempt
to exculpate herself must fail. ATTY. LIGSAY:
Q: In your line of expertise on can testify on pentothal here with
pulmonology, did you have any medical authority?
occasion to use pentothal as a
method of management? A: No. That is why I used references
to support my claims. 61
DR. JAMORA:
An anesthetic accident caused by a rare drug-induced bronchospasm
A: We do it in conjunction with the properly falls within the fields of anesthesia, internal medicine-
anesthesiologist when they have to allergy, and clinical pharmacology. The resulting anoxic
intubate our patient. encephalopathy belongs to the field of neurology. While admittedly,
many bronchospastic-mediated pulmonary diseases are within the
Q: But not in particular when you expertise of pulmonary medicine, Dr. Jamora's field, the anesthetic
practice pulmonology? drug-induced, allergic mediated bronchospasm alleged in this case is
within the disciplines of anesthesiology, allergology and
A: No. pharmacology. On the basis of the foregoing transcript, in which the
pulmonologist himself admitted that he could not testify about the
Q: In other words, your knowledge drug with medical authority, it is clear that the appellate court erred in
about pentothal is based only on giving weight to Dr. Jamora's testimony as an expert in the
what you have read from books and administration of Thiopental Sodium.
not by your own personal application 62
of the medicine pentothal? The provision in the rules of evidence regarding expert witnesses
states:
A: Based on my personal experience
also on pentothal. Sec. 49. Opinion of expert witness. — The opinion of
a witness on a matter requiring special knowledge,
Q: How many times have you used skill, experience or training which he is shown to
pentothal? possess, may be received in evidence.

A: They used it on me. I went into Generally, to qualify as an expert witness, one must have acquired
bronchospasm during my special knowledge of the subject matter about which he or she is to
appendectomy. testify, either by the study of recognized authorities on the subject or
by practical experience. 63 Clearly, Dr. Jamora does not qualify as an
Q: And because they have used it on expert witness based on the above standard since he lacks the
you and on account of your own necessary knowledge, skill, and training in the field of anesthesiology.
personal experience you feel that you Oddly, apart from submitting testimony from a specialist in the wrong
field, private respondents' intentionally avoided providing testimony the chain of events leading to Erlinda's brain damage and, ultimately,
by competent and independent experts in the proper areas. her comatosed condition.

Moreover, private respondents' theory, that Thiopental Sodium may Private respondents themselves admitted in their testimony that the
have produced Erlinda's coma by triggering an allergic mediated first intubation was a failure. This fact was likewise observed by
response, has no support in evidence. No evidence of stridor, skin witness Cruz when she heard respondent Dra. Gutierrez remarked,
reactions, or wheezing — some of the more common accompanying "Ang hirap ma-intubate nito, mali yata ang pagkakapasok. O lumalaki
signs of an allergic reaction — appears on record. No laboratory data ang tiyan." Thereafter, witness Cruz noticed abdominal distention on
were ever presented to the court. the body of Erlinda. The development of abdominal distention,
together with respiratory embarrassment indicates that the
In any case, private respondents themselves admit that Thiopental endotracheal tube entered the esophagus instead of the respiratory tree.
induced, allergic-mediated bronchospasm happens only very rarely. If In other words, instead of the intended endotracheal intubation what
courts were to accept private respondents' hypothesis without actually took place was an esophageal intubation. During intubation,
supporting medical proof, and against the weight of available such distention indicates that air has entered the gastrointestinal tract
evidence, then every anesthetic accident would be an act of God. through the esophagus instead of the lungs through the trachea. Entry
Evidently, the Thiopental-allergy theory vigorously asserted by into the esophagus would certainly cause some delay in oxygen
private respondents was a mere afterthought. Such an explanation was delivery into the lungs as the tube which carries oxygen is in the wrong
advanced in order to advanced in order to absolve them of any and all place. That abdominal distention had been observed during the first
responsibility for the patient's condition. intubation suggests that the length of time utilized in inserting the
endotracheal tube (up to the time the tube was withdrawn for the
In view of the evidence at hand, we are inclined to believe petitioners' second attempt) was fairly significant. Due to the delay in the delivery
stand that it was the faulty intubation which was the proximate cause of oxygen in her lungs Erlinda showed signs of cyanosis. 66 As stated
of Erlinda's comatose condition. in the testimony of Dr. Hosaka, the lack of oxygen became apparent
only after he noticed that the nailbeds of Erlinda were already
Proximate cause has been defined as that which, in natural and blue. 67 However, private respondents contend that a second intubation
continuous sequence, unbroken by any efficient intervening cause, was executed on Erlinda and this one was successfully done. We do
produces injury, and without which the result would not have not think so. No evidence exists on record, beyond private
occurred. 64 An injury or damage is proximately caused by an act or a respondents' bare claims, which supports the contention that the
failure to act, whenever it appears from the evidence in the case, that second intubation was successful. Assuming that the endotracheal
the act or omission played a substantial part in bringing about or tube finally found its way into the proper orifice of the trachea, the
actually causing the injury or damage; and that the injury or damage same gave no guarantee of oxygen delivery, the hallmark of a
was either a direct result or a reasonably probable consequence of the successful intubation. In fact, cyanosis was again observed
act or omission. 65 It is the dominant, moving or producing cause. immediately after the second intubation. Proceeding from this event
(cyanosis), it could not be claimed, as private respondents insist, that
Applying the above definition in relation to the evidence at hand, the second intubation was accomplished. Even granting that the tube
faulty intubation is undeniably the proximate cause which triggered was successfully inserted during the second attempt, it was obviously
too late. As aptly explained by the trial court, Erlinda already suffered Erlinda's cholecystectomy, and was in fact over three hours late for the
brain damage as a result of the inadequate oxygenation of her brain latter's operation. Because of this, he had little or no time to confer
for about four to five minutes. 68 with his anesthesiologist regarding the anesthesia delivery. This
indicates that he was remiss in his professional duties towards his
The above conclusion is not without basis. Scientific studies point out patient. Thus, he shares equal responsibility for the events which
that intubation problems are responsible for one-third (1/3) of deaths resulted in Erlinda's condition.
and serious injuries associated with anesthesia. 69 Nevertheless,
ninety-eight percent (98%) or the vast majority of difficult intubations We now discuss the responsibility of the hospital in this particular
may be anticipated by performing a thorough evaluation of the incident. The unique practice (among private hospitals) of filling up
patient's airway prior to the operation. 70 As stated beforehand, specialist staff with attending and visiting "consultants," 74 who are
respondent Dra. Gutierrez failed to observe the proper pre-operative allegedly not hospital employees, presents problems in apportioning
protocol which could have prevented this unfortunate incident. Had responsibility for negligence in medical malpractice cases. However,
appropriate diligence and reasonable care been used in the pre- the difficulty is only more apparent than real.
operative evaluation, respondent physician could have been much
more prepared to meet the contingency brought about by the perceived In the first place, hospitals exercise significant control in the hiring
anatomic variations in the patient's neck and oral area, defects which and firing of consultants and in the conduct of their work within the
would have been easily overcome by a prior knowledge of those hospital premises. Doctors who apply for "consultant" slots, visiting
variations together with a change in technique. 71 In other words, an or attending, are required to submit proof of completion of residency,
experienced anesthesiologist, adequately alerted by a thorough pre- their educational qualifications; generally, evidence of accreditation
operative evaluation, would have had little difficulty going around the by the appropriate board (diplomate), evidence of fellowship in most
short neck and protruding teeth. 72 Having failed to observe common cases, and references. These requirements are carefully scrutinized by
medical standards in pre-operative management and intubation, members of the hospital administration or by a review committee set
respondent Dra. Gutierrez' negligence resulted in cerebral anoxia and up by the hospital who either accept or reject the application. 75 This
eventual coma of Erlinda. is particularly true with respondent hospital.

We now determine the responsibility of respondent Dr. Orlino Hosaka After a physician is accepted, either as a visiting or attending
as the head of the surgical team. As the so-called "captain of the consultant, he is normally required to attend clinico-pathological
ship," 73 it is the surgeon's responsibility to see to it that those under conferences, conduct bedside rounds for clerks, interns and residents,
him perform their task in the proper manner. Respondent Dr. Hosaka's moderate grand rounds and patient audits and perform other tasks and
negligence can be found in his failure to exercise the proper authority responsibilities, for the privilege of being able to maintain a clinic in
(as the "captain" of the operative team) in not determining if his the hospital, and/or for the privilege of admitting patients into the
anesthesiologist observed proper anesthesia protocols. In fact, no hospital. In addition to these, the physician's performance as a
evidence on record exists to show that respondent Dr. Hosaka verified specialist is generally evaluated by a peer review committee on the
if respondent Dra. Gutierrez properly intubated the patient. basis of mortality and morbidity statistics, and feedback from patients,
Furthermore, it does not escape us that respondent Dr. Hosaka had nurses, interns and residents. A consultant remiss in his duties, or a
scheduled another procedure in a different hospital at the same time as consultant who regularly falls short of the minimum standards
acceptable to the hospital or its peer review committee, is normally similar nature, respondent hospital thereby failed to discharge its
politely terminated. burden under the last paragraph of Article 2180. Having failed to do
this, respondent hospital is consequently solidarily responsible with its
In other words, private hospitals, hire, fire and exercise real control physicians for Erlinda's condition.
over their attending and visiting "consultant" staff. While
"consultants" are not, technically employees, a point which respondent Based on the foregoing, we hold that the Court of Appeals erred in
hospital asserts in denying all responsibility for the patient's condition, accepting and relying on the testimonies of the witnesses for the
the control exercised, the hiring, and the right to terminate consultants private respondents. Indeed, as shown by the above discussions,
all fulfill the important hallmarks of an employer-employee private respondents were unable to rebut the presumption of
relationship, with the exception of the payment of wages. In assessing negligence. Upon these disquisitions we hold that private respondents
whether such a relationship in fact exists, the control test is are solidarily liable for damages under Article 2176 79 of the Civil
determining. Accordingly, on the basis of the foregoing, we rule that Code.
for the purpose of allocating responsibility in medical negligence
cases, an employer-employee relationship in effect exists between We now come to the amount of damages due petitioners. The trial
hospitals and their attending and visiting physicians. This being the court awarded a total of P632,000.00 pesos (should be P616,000.00)
case, the question now arises as to whether or not respondent hospital in compensatory damages to the plaintiff, "subject to its being
is solidarily liable with respondent doctors for petitioner's condition. 76 updated" covering the period from 15 November 1985 up to 15 April
1992, based on monthly expenses for the care of the patient estimated
The basis for holding an employer solidarily responsible for the at P8,000.00.
negligence of its employee is found in Article 2180 of the Civil Code
which considers a person accountable not only for his own acts but At current levels, the P8000/monthly amount established by the trial
also for those of others based on the former's responsibility under a court at the time of its decision would be grossly inadequate to cover
relationship of patria potestas. 77 Such responsibility ceases when the the actual costs of home-based care for a comatose individual. The
persons or entity concerned prove that they have observed the calculated amount was not even arrived at by looking at the actual cost
diligence of a good father of the family to prevent damage. 78 In other of proper hospice care for the patient. What it reflected were the actual
words, while the burden of proving negligence rests on the plaintiffs, expenses incurred and proved by the petitioners after they were forced
once negligence is shown, the burden shifts to the respondents (parent, to bring home the patient to avoid mounting hospital bills.
guardian, teacher or employer) who should prove that they observed
the diligence of a good father of a family to prevent damage. And yet ideally, a comatose patient should remain in a hospital or be
transferred to a hospice specializing in the care of the chronically ill
In the instant case, respondent hospital, apart from a general denial of for the purpose of providing a proper milieu adequate to meet
its responsibility over respondent physicians, failed to adduce minimum standards of care. In the instant case for instance, Erlinda
evidence showing that it exercised the diligence of a good father of a has to be constantly turned from side to side to prevent bedsores and
family in the hiring and supervision of the latter. It failed to adduce hypostatic pneumonia. Feeding is done by nasogastric tube. Food
evidence with regard to the degree of supervision which it exercised preparation should be normally made by a dietitian to provide her with
over its physicians. In neglecting to offer such proof, or proof of a the correct daily caloric requirements and vitamin supplements.
Furthermore, she has to be seen on a regular basis by a physical can and should be awarded on top of actual or compensatory damages
therapist to avoid muscle atrophy, and by a pulmonary therapist to in instances where the injury is chronic and continuing. And because
prevent the accumulation of secretions which can lead to respiratory of the unique nature of such cases, no incompatibility arises when both
complications. actual and temperate damages are provided for. The reason is that
these damages cover two distinct phases.
Given these considerations, the amount of actual damages recoverable
in suits arising from negligence should at least reflect the correct As it would not be equitable — and certainly not in the best interests
minimum cost of proper care, not the cost of the care the family is of the administration of justice — for the victim in such cases to
usually compelled to undertake at home to avoid bankruptcy. constantly come before the courts and invoke their aid in seeking
However, the provisions of the Civil Code on actual or compensatory adjustments to the compensatory damages previously awarded —
damages present us with some difficulties. temperate damages are appropriate. The amount given as temperate
damages, though to a certain extent speculative, should take into
Well-settled is the rule that actual damages which may be claimed by account the cost of proper care.
the plaintiff are those suffered by him as he has duly proved. The Civil
Code provides: In the instant case, petitioners were able to provide only home-based
nursing care for a comatose patient who has remained in that condition
Art. 2199. — Except as provided by law or by for over a decade. Having premised our award for compensatory
stipulation, one is entitled to an adequate damages on the amount provided by petitioners at the onset of
compensation only for such pecuniary loss suffered litigation, it would be now much more in step with the interests of
by him as he has duly proved. Such compensation is justice if the value awarded for temperate damages would allow
referred to as actual or compensatory damages. petitioners to provide optimal care for their loved one in a facility
which generally specializes in such care. They should not be
Our rules on actual or compensatory damages generally assume that compelled by dire circumstances to provide substandard care at home
at the time of litigation, the injury suffered as a consequence of an act without the aid of professionals, for anything less would be grossly
of negligence has been completed and that the cost can be liquidated. inadequate. Under the circumstances, an award of P1,500,000.00 in
However, these provisions neglect to take into account those temperate damages would therefore be reasonable. 81
situations, as in this case, where the resulting injury might be
continuing and possible future complications directly arising from the In Valenzuela vs. Court of Appeals, 82 this Court was confronted with
injury, while certain to occur, are difficult to predict. a situation where the injury suffered by the plaintiff would have led to
expenses which were difficult to estimate because while they would
In these cases, the amount of damages which should be awarded, if have been a direct result of the injury (amputation), and were certain
they are to adequately and correctly respond to the injury caused, to be incurred by the plaintiff, they were likely to arise only in the
should be one which compensates for pecuniary loss incurred and future. We awarded P1,000,000.00 in moral damages in that case.
proved, up to the time of trial; and one which would meet pecuniary
loss certain to be suffered but which could not, from the nature of the Describing the nature of the injury, the Court therein stated:
case, be made with certainty. 80 In other words, temperate damages
As a result of the accident, Ma. Lourdes Valenzuela A prosthetic devise, however technologically
underwent a traumatic amputation of her left lower advanced, will only allow a reasonable amount of
extremity at the distal left thigh just above the knee. functional restoration of the motor functions of the
Because of this, Valenzuela will forever be deprived lower limb. The sensory functions are forever lost.
of the full ambulatory functions of her left extremity, The resultant anxiety, sleeplessness, psychological
even with the use of state of the art prosthetic injury, mental and physical pain are inestimable. 83
technology. Well beyond the period of hospitalization
(which was paid for by Li), she will be required to The injury suffered by Erlinda as a consequence of private
undergo adjustments in her prosthetic devise due to respondents' negligence is certainly much more serious than the
the shrinkage of the stump from the process of amputation in the Valenzuela case.
healing.
Petitioner Erlinda Ramos was in her mid-forties when the incident
These adjustments entail costs, prosthetic occurred. She has been in a comatose state for over fourteen years
replacements and months of physical and now. The burden of care has so far been heroically shouldered by her
occupational rehabilitation and therapy. During the husband and children, who, in the intervening years have been
lifetime, the prosthetic devise will have to be replaced deprived of the love of a wife and a mother.
and readjusted to changes in the size of her lower limb
effected by the biological changes of middle-age, Meanwhile, the actual physical, emotional and financial cost of the
menopause and aging. Assuming she reaches care of petitioner would be virtually impossible to quantify. Even the
menopause, for example, the prosthetic will have to temperate damages herein awarded would be inadequate if petitioner's
be adjusted to respond to the changes in bone condition remains unchanged for the next ten years.
resulting from a precipitate decrease in calcium levels
observed in the bones of all post-menopausal women. We recognized, in Valenzuela that a discussion of the victim's actual
In other words, the damage done to her would not injury would not even scratch the surface of the resulting moral
only be permanent and lasting, it would also be damage because it would be highly speculative to estimate the amount
permanently changing and adjusting to the of emotional and moral pain, psychological damage and injury
physiologic changes which her body would normally suffered by the victim or those actually affected by the victim's
undergo through the years. The replacements, condition. 84 The husband and the children, all petitioners in this case,
changes, and adjustments will require corresponding will have to live with the day to day uncertainty of the patient's illness,
adjustive physical and occupational therapy. All of knowing any hope of recovery is close to nil. They have fashioned
these adjustments, it has been documented, are their daily lives around the nursing care of petitioner, altering their
painful. long term goals to take into account their life with a comatose patient.
They, not the respondents, are charged with the moral responsibility
xxx xxx xxx of the care of the victim. The family's moral injury and suffering in
this case is clearly a real one. For the foregoing reasons, an award of
P2,000,000.00 in moral damages would be appropriate.
Finally, by way of example, exemplary damages in the amount of
P100,000.00 are hereby awarded. Considering the length and nature
of the instant suit we are of the opinion that attorney's fees valued at
P100,000.00 are likewise proper.

Our courts face unique difficulty in adjudicating medical negligence

cases because physicians are not insurers of life and, they rarely set
out to intentionally cause injury or death to their patients. However,
intent is immaterial in negligence cases because where negligence
exists and is proven, the same automatically gives the injured a right
to reparation for the damage caused.

Established medical procedures and practices, though in constant flux

are devised for the purpose of preventing complications. A physician's
experience with his patients would sometimes tempt him to deviate
from established community practices, and he may end a distinguished
career using unorthodox methods without incident. However, when
failure to follow established procedure results in the evil precisely
sought to be averted by observance of the procedure and a nexus is
made between the deviation and the injury or damage, the physician
would necessarily be called to account for it. In the case at bar, the
failure to observe pre-operative assessment protocol which would
have influenced the intubation in a salutary way was fatal to private
respondents' case.

WHEREFORE, the decision and resolution of the appellate court

appealed from are hereby modified so as to award in favor of
petitioners, and solidarily against private respondents the following:
1) P1,352,000.00 as actual damages computed as of the date of
promulgation of this decision plus a monthly payment of P8,000.00
up to the time that petitioner Erlinda Ramos expires or miraculously
survives; 2) P2,000,000.00 as moral damages, 3) P1,500,000.00 as
temperate damages; 4) P100,000.00 each as exemplary damages and
attorney's fees; and, 5) the costs of the suit.

SO ORDERED.
G.R. No. 136722 April 12, 2000 1. Ordering the defendants D.M. Transit Corporation, D.M.
Consortium Inc. and Eduardo Diaz y Mendoza jointly and
INDUSTRIAL INSURANCE COMPANY, Inc., petitioner, severally, to pay plaintiff Industrial Insurance Co., Inc.:
vs.
PABLO BONDAD and LIGORIO BONDAD, respondents. (a) The sum of P29,800.00 representing the amount it
had to pay to Grace Ladaw Morales under its
Insurance Policy No. 00857, with interest thereon at
the legal rate from April 12, 1985 until fully paid;

PANGANIBAN, J.: (b) The sum of P2,000 as litigation and adjustment

expenses; and
No person should be penalized for the exercise of the right to litigate.
This right, however, must be exercised in good faith. Absence of good (c) The sum of P15,000.00 as and for attorney's fees;
faith in the present case is shown by the fact that petitioner clearly has
no cause of action against respondents but it recklessly filed suit 2. Ordering the plaintiff Industrial Insurance Co., Inc., to pay
anyway and wantonly pursued pointless appeals, thereby causing the to the defendants-counterclaimants Pablo Bondad and Ligorio
latter to spend valuable time, money and effort in unnecessarily Bondad jointly and severally:
defending themselves, incurring damages in the process.
(a) The sum of P15,000.00 representing their
The Case attorney's fees, and P6,300.00 as appearance fees;

Before us is a Petition for Review under Rule 45 assailing the July 29, (b) The sum of P10,500.00 representing their
1998 Decision1 of the Court of Appeals2 (CA), as well as its December expenses for the twenty-one hearings consisting of
4, 1998 Resolution in CA-GR CR CV No. 50573. In its Decision, the jeepney hire and meals;
CA ruled:3
(c) The sum of P75,000.00 in the concept of moral
WHEREFORE, the Decision appealed from is AFFIRMED damages for their having been recklessly and without
with the MODIFICATION that the award for attending basis being impleaded by the plaintiff inspite of the
hearings in the amount of P10,500.00 is deleted; and the clear language in the Traffic Investigation Report
award for moral and exemplary damages is reduced to (Exhibit "1-A") submitted by Pfc. Agapito Domingo;
P50,000.00 and P10,000.00, respectively. and

The trial court ruling4 modified by the CA reads as follows: (d) The sum of P25,000.00 by way of exemplary
damages.
WHEREFORE, from all the foregoing findings, the Court
hereby renders judgment as follows:
 3. Ordering the cross-defendants jointly and severally to pay Investigation disclosed that shortly before the accident took
the cross-claimants Bondads the sum of P8,000.00 place, V-3 (D.M. Transit Bus) was traveling along South
representing the cost of repairs of the jeepney, with interest at Expressway coming from Alabang towards the general
the legal rate from April 2, 1985 until fully paid. direction of Makati. When upon reaching a place at KM Post
14 [in front] of Merville Subd., said V-3 hit and bumped the
4. Dismissed for lack of merit are: rear left side portion of V-1 [Bondads' jeepney] which was
then at [stop] position due to flat tire[;] due to the severe
(a) the cross-claim against the Bondads; impact cause by V-3 it swerved to the left and collided with
the right side portion of V-2 [Morales' car] which was
(b) the third party complaint against the GSIS; travelling [in] the same direction taking the innermost lane[;]
V-2 was dragged to its left side and hit the concrete wall. All
(c) the cross-claims against the GSIS; and vehicles incurred damages and sustaining injuries to the
occupant of V-1 and the passengers of V-3. Victims were
brought to the hospital for treatment.6
(d) the counterclaim interposed by the defendants
except that of the Bondads.
Before the Regional Trial Court of Makati on April 12, 1985,
Petitioner Industrial Insurance Company, Inc. and Grace Ladaw
5. The claim made by plaintiff Grace Ladaw Morales is
Morales filed a Complaint for damages 7 against DM Transit
likewise dismissed for lack of evidence in support thereof. She
Corporation, Eduardo Diaz, Pablo Bondad and Ligorio Bondad.
is not held liable in favor of Pablo Bondad and Ligorio
Petitioner contended that it had paid Morales P29,800 for the damages
Bondad for lack of proof that she authorized the filing of this
to her insured car. It also asserted that the December 17, 1984 accident
suit.5 had been caused "solely and proximately" by the "joint gross and
wanton negligence, carelessness and imprudence of both defendant
The December 4, 1998 CA Resolution denied petitioner's Motion for drivers Eduardo Diaz y Mendoza and Ligorio Bondad y Hernandez,
Reconsideration. who failed to exercise and observe the diligence required by law in the
management and operation of their respective vehicles and by their
The Facts defendant employers; D.M. Transit Corporation and Pablo Bondad,
respectively, for their failure to exercise the diligence required of them
The present Petition finds its roots in an incident which involved three by law in the selection and supervision of their employees including
vehicles: a Galant Sigma car driven by Grace Ladaw Morales, a their aforementioned involved drivers.8
packed passenger jeepney originally driven by Ligorio Bondad, and a
DM Transit Bus driven by Eduardo Mendoza. On June 6, 1985, Respondents Pablo and Ligorio Bondad filed their
Answer9 denying any responsibility or liability to petitioner and
Pfc. Agapito L. Domingo of the Southern Police District investigated Morales. They asserted that their vehicle was on full stop because of
the accident and filed the following report: a flat tire. Thus, it was the bus which hit Morales' car. 10 In their
Counterclaim, they contended that petitioner had acted in bad faith in
impleading them and that, contrary to its allegation, no prior demand Proximate cause is that which, in natural and continuous
had been made upon them. 11 sequence, unbroken by an efficient intervening cause,
produces injury without which the result would not have
In its October 14, 1991 Decision, the trial court exculpated the occurred. (Sabena Belgian World Airline, 255 SCRA 38;
Bondads and ordered petitioner to pay them actual, moral and Pilipinas Bank vs. Court of Appeals, 234 SCRA 435) As
exemplary damages, as well as attorney's fees. borne out by the evidence in this case, the proximate cause of
the damage to the car of plaintiff Morales was the negligence
Petitioner appealed to the Court of Appeals, which affirmed the ruling of the driver of the DM Transit bus. Plaintiff-appellant had no
of the trial court with modification. valid cause of action against defendants Bondad.

Hence, this Petition for Review. 12 The CA, however, reduced the lower court's award of damages to the
Bondads, ratiocinating as follows:
The CA Ruling
We agree with the trial court when it granted the counter-
The appellate court debunked petitioner's assertion that it had a cause claim of defendants Bondad. The plaintiff-appellant insurance
of action against the Bondads, whose negligence was allegedly the company did not verify the facts before impleading the
proximate cause of the damage to the insured vehicle. Bondads in this action for damages. The trial court noted that
plaintiff-appellant failed to even make a formal demand from
The records are clear, however, that soon after the D.M. the defendants Bondad before it filed the present case. As
Transit Bus hit the jeepney of the defendant Bondad, the bus stated by the trial court in the aforequoted decision, had a
formal demand been made by the plaintiffs on the Bondads,
swerved to the left hitting the car of plaintiff Morales. This
fact was supported by the investigation report made by Pfc. matters could have been clarified. As it were, the Bondads had
Agapito L. Domingo of the Southern Police District (Exh. to come to Makati from Alaminos every time this case was set
"A") as well as the testimony of defendant Ligorio Bondad for hearing and not only suffered inconvenience but incurred
which was supported by photographs of defendant Bondad's expenses, particularly for attorney's fees.
jeepney which were taken immediately after the incident.
(Exh. "3") It was shown that the jeepney remained at the right We, however, believe that the expenses for attending the
shoulder of the expressway (northbound) even after it had hearings should be deleted, the same not having been
been hit forward from its position as a result of the impact. sufficiently proven. Likewise, moral and exemplary damages
According to Ligorio Bondad, when he noticed that his tire should be reduced to the more reasonable amounts of
was flat, he slowed down and drove towards the rightmost P50,000.00 and P10,000.00, respectively.
lane of the expressway with great difficulty until he was able
to stop at the right shoulder of the road. (TSN, pp. 55-62, Issues
March 21, 1989) This was consistent with the affidavit he had
13
made at the Traffic Bureau Station in Fort Bonifacio on the In its Memorandum, petitioner presents the following issues for
same day of the accident, December 17, 1984. (Exh. "2-A") resolution:
 A) Whether or not the assailed decision and resolution of the under any of them. There is no contrariety between the findings of the
Honorable Court of Appeals were scrutinized closely with the trial court and those of the CA as to what and who had caused the
legal aspect of law, Articles 2202, 2203, 2219 and 2220 of the December 17, 1984 accident. We find no reason to modify or reverse
Civil Code, in light of the evidence presented in making its both courts' finding that the mishap was caused by the negligence of
decision and its resolution. Eduardo Diaz, the bus driver.

B) Whether or not the Honorable Court of Appeals with due Main Issue:
respect, went out of the "path of law" and disregarded past
precedents applicable to the case at bar. Award of Damages and Attorney's Fees

In the main, the core issue is the propriety of the award of moral and In justifying the award of attorney's fees and other litigation expenses,
exemplary damages, as well as attorney's fees, to the respondents. We the appellate court held that respondents were compelled to litigate an
shall also discuss a preliminary matter: the cause of the accident. unfounded suit because of petitioner's negligence and lack of prudence
in not verifying the facts before filing this action. In affirming the
The Court's Ruling award of moral damages, it accepted the trial court's justification that
respondents had "been recklessly and without basis . . . impleaded by
The Petition is not meritorious. the plaintiff in spite of the clear language in the Traffic Investigation
Report . . . submitted by Pfc. Agapito Domingo." 16
Preliminary Issue:
We agree.
Cause of Accident
Attorney's fees may be awarded by a court if one who claims it is
Petitioner insists that the negligence of Ligorio and Pablo Bondad was compelled to litigate with third persons or to incur expenses to protect
the proximate cause of the accident that damaged the insured vehicle one's interests by reason of an unjustified act or omission on the part
of Grace Ladaw Morales. of the party from whom it is sought. 17

This argument deserves scant consideration. Questions regarding the In this case, the records show that petitioner's suit against respondents
cause of the accident and the persons responsible for it are factual was manifestly unjustified. In the first place, the contact between the
issues which we cannot pass upon. It is jurisprudentially settled that, vehicles of respondents and of Morales was completely due to the
as a rule, the jurisdiction of this Court is limited to a review of errors impact of the onrushing bus. This fact is manifest in the police
of law allegedly committed by the appellate court. It is not bound to investigation report and, significantly, in the findings of facts of both
analyze and weigh all over again the evidence already considered in lower courts.
the proceedings below. 14
Moreover, even a cursory examination of the events would show that
True, there are instances when this Court may review factual respondents were not even remotely the cause of the accident. Their
issues, 15 but petitioner has failed to demonstrate why his case falls vehicle was on the shoulder of the road because of a flat tire. In view
of their emergency situation, they could not have done anything to defendants, and if the jeepney had in any way caused, or
avoid getting hit by the bus. Verily, an ordinary person has no reason contributed to, the accident, it could very well be impleaded
to think that respondents could have caused the accident. It is difficult by the D.M. Transit Bus operator. Worse, no demand for
to imagine how petitioner could have thought so. payment was ever made by the plaintiffs on the Bondads. Had
a formal demand been made by the plaintiffs on the Bondads,
More significantly, petitioner knew that respondents were not the the latter's role could have been clarified. As it is, they had to
cause of the accident. This is evident from its failure to even make a face a lawsuit and were constrained to come all the way to
prior formal demand on them before initiating the suit. Indeed, the Makati from Alaminos for not to do so could place them in a
cause of the accident was the negligence of the DM Transit bus driver. situation where judgment may be rendered against them. 18
In this light, we agree with the following findings of the trial court:
In impleading respondents, petitioner clearly acted in wanton
It is the Court's findings that the D.M. Transit Bus in question disregard of facts that were as obvious then as they are now. To repeat,
was recklessly engaged in a race with a Baliuag Transit Bus even a cursory examination of the police investigation report and other
and tried to outrun the former by using the shoulder of the pertinent data at the time would show that there was no reason to
road, a tactic that is very common along the South implead respondents. The carelessness and lack of diligence of
Expressway. Unfortunately for the D.M. Transit Bus, petitioner destroy its claim of good faith. Accordingly, the award of
defendant Pablo Bondad's jeepney was at a stop at the attorney's fees should be sustained.
shoulder along the path to be taken by the erring bus[;] it was
not parked, but was at an emergency stop, the emergency In the same vein, we affirm the award of moral damages. To sustain
being a flat tire. The consequence of this rash action was the this award, it must be shown that (1) the claimant suffered injury, and
accident to the Bondad jeepney and subsequently to the (2) such injury sprung from any of the cases listed in Articles 2219
Lancer car owned and operated by one Grace Morales Ladaw and 2220 of the Civil Code. It is not enough that the claimant alleges
which vehicle was pinned by the D.M. Transit to the concrete mental anguish, serious anxiety, wounded feelings, social humiliation,
island dividing the road. There can be no question that the and the like as a result of the acts of the other party. It is necessary that
driver of the D.M. Transit Bus was at fault for the accident. such acts be shown to have been tainted with bad faith or ill motive. 19

It is further the Court's finding that the plaintiffs have In the case at bar, it has been shown that the petitioner acted in bad
absolutely no cause of action against the faith in compelling respondents to litigate an unfounded claim. As a
Bondads.1âwphi1 The latter's jeepney never got into contact result, Respondent Ligorio Bondad "could no longer concentrate on
with Ms. Morales' car. While it is true that before the D.M. his job." Moreover, Pablo Bondad became sick and even suffered a
Transit Bus hit Ms. Morales car, it had gotten involved in an mild stroke. Indeed, respondents' anxiety is not difficult to understand.
accident with the Bondad jeepney[;] it is equally true that at They were innocently attending to a flat tire on the shoulder of the
the time of the accident the Bondad jeepney was at an road; the next thing they knew, they were already being blamed for an
emergency stop. This fact was obvious not only from the accident. Worse, they were forced to commute all the way from
scene of the accident but also from the police investigation Laguna to Makati in order to attend the hearings. Under the
report. There was no need to implead the Bondads as circumstances of this case, the award of moral damages is justified.
Likewise, we affirm the award of exemplary damages because
petitioner's conduct needlessly dragged innocent bystanders into an
unfounded litigation. Indeed, exemplary damages are imposed by way
of example or correction for the public good, in addition to moral,
temperate, liquidated or compensatory damages. 20

In sum, the Court affirms the award of moral damages, exemplary

damages, attorney's fees and litigation expenses. The facts of this case
clearly show that petitioner was motivated by bad faith in impleading
respondents. Indeed, a person's right to litigate, as a rule, should not
be penalized. This right, however, must be exercised in good faith. 21

One final note. Respondents pray that the amount of actual, moral and
exemplary damages awarded by the trial court be reinstated. 22 We
cannot do so in this case because they did not appeal the CA Decision.
Jurisprudentially, they are deemed to be satisfied with it and thus
cannot be allowed to attack it belatedly in their Memorandum.

WHEREFORE, the Petition is hereby DENIED and the assailed

Decision AFFIRMED. Double costs against petitioner.

SO ORDERED.
G.R. No. 139875 December 4, 2000 "It appears from the records that at around 2:00 o'clock [o]n
the afternoon of August 9, 1986, Ananias Sumayang was
GREGORIO PESTAÑO and METRO CEBU AUTOBUS riding a motorcycle along the national highway in Ilihan,
CORPORATION, petitioners, Tabagon, Cebu. Riding with him was his friend Manuel
vs. Romagos. As they came upon a junction where the highway
Spouses TEOTIMO SUMAYANG and PAZ C. connected with the road leading to Tabagon, they were hit by
SUMAYANG, respondents. a passenger bus driven by [Petitioner] Gregorio Pestaño and
owned by [Petitioner] Metro Cebu Autobus Corporation
PANGANIBAN, J.: (Metro Cebu, for brevity), which had tried to overtake them,
sending the motorcycle and its passengers hurtling upon the
Factual findings of the Court of Appeals, affirming those of the trial pavement. Both Ananias Sumayang and Manuel Romagos
judge, are binding on this Court. In quasi-delicts, such findings are were rushed to the hospital in Sogod, where Sumayang was
crucial because negligence is largely a matter of evidence. In pronounced dead on arrival. Romagos was transferred to the
computing an award for lost earning capacity, the life expectancy of Cebu Doctors' Hospital, but he succumbed to his injuries the
the deceased, not that of the heir, is used as basis. day after.

The Case "Apart from the institution of criminal charges against

Gregorio Pestaño, [Respondents] Teotimo and Paz
Before us is a Petition for Review on Certiorari under Rule 45 of the Sumayang, as heirs of Ananias Sumayang, filed this civil
Rules of Court, assailing the April 21, 1999 Decision and the August action for damages against Gregorio Pestaño, as driver of the
6, 1999 Resolution of the Court of Appeals 1 (CA) in CA-GR CV No. passenger bus that rammed the deceased's motorcycle, Metro
Cebu, as owner and operator of the said bus, and Perla
30289. The questioned Decision disposed as follows:
Compania de Seguros, as insurer of Metro Cebu. The case was
docketed as Civil Case No. CEB-6108.
"WHEREFORE, premises considered, the instant appeal is
hereby DENIED. The assailed Decision of the lower court is
hereby AFFIRMED with the aforesaid modification regarding "On November 9, 1987, upon motion of [Petitioner] Pestaño,
the award of death penalty." Judge Pedro C. Son ordered the consolidation of the said case
with Criminal Case No. 10624, pending in Branch 16 of the
same Court, involving the criminal prosecution of Gregorio
The Resolution of August 6, 1999 denied reconsideration. 2
Pestaño for [d]ouble [h]omicide thru [r]eckless [i]mprudence.
Joint trial of the two cases thereafter ensued, where the
The Facts following assertions were made:
The events leading to this Petition were summarized by the '[Respondents] rely mainly on the testimonies of
Court of Appeals as follows: Ignacio Neis, Pat. Aquilino Dinoy and Teotimo
Sumayang, father of the deceased. Neis declared that
he saw the incident while he was sitting on a bench ahead went to the right side of the highway that he
beside the highway; that both vehicles c[a]me from again blew the horn and accelerated in order to
the North; that as the motorcycle approached the overtake the motorcycle; that when he was just one
junction to Tab[a]gon, the driver Ananias Sumayang meter behind, the motorcycle suddenly turned left
signalled with his left arm to indicate that he was towards the Tab[a]gon [R]oad and was bumped by his
taking the Tab[a]gon Road; that the motorcycle did bus; that he was able to apply his break only after the
turn left but as it did so, it was bumped by an impact. Pestaño's testimony was corroborated by
overspeeding bus; that the force of the impact threw Ireneo Casilia who declared that he was one of the
Ananias Sumayang and his companion Manuel passengers of the bus; that the motorcycle suddenly
Romagos about 14 meters away. The motorcycle, turned left towards Tab[a]gon [R]oad without giving
Neis continued, was badly damaged as it was dragged any signal to indicate its maneuver; that the bus was
by the bus. going at 40 kph when the accident occurred.

'On the other hand, Pat. Dinoy testified that he was in 'To substantiate its defense of bonos pater
the nearby house of Ruben Tiu [when] he heard the familias [petitioner] [c]orporation recalled to the
sound or noise caused by the collision; that he witness box Gregorio Pestaño who explained how his
immediately went to the scene where he found driving experience and ability were tested by the
Ananias Sumayang and Manuel Romagos lying on company before he was hired. He further declared
the road bleeding and badly injured; that he requested that the management gave regular lectures to drivers
the driver of a PU vehicle to take them to a hospital; and conductors touching on various topics like
that he took note of the various distances which he speeding, parking, loading and treatment of
included in his sketch (Exh. J) that the probable point passengers, and that before he took to the road at 2:30
of impact was at the left lane of the highway and right AM of that day he checked together with the
at the junction to Tab[a]gon (Exh J-11); that he based mechanic the tires, brake, signal lights as well as the
his conclusion on the 'scratches' caused by the tools to be brought along. He did the same thing
motorcycle's footrest on the asphalt pavement; that he before commencing his return trip from Hagnaya, San
described the damage caused to the motorcycle in his Remegio later in the day.
sketch (Exh J); that on the part of the bus, the right
end of its front bumper was bent and the right portion 'The corporation also presented its maintenance
of the radiator grill was dented. Pat. Dinoy supervisor, Agustin Pugeda, Jr., and its manager,
acknowledged that he met at the scene Ignacio Neis Alfonso Corominas, Jr. who corroborated Pestaño's
who informed him that he saw the incident. testimony that his driving ability was thoroughly
tested, and that all drivers underwent periodic lecture
'On the contrary, Pestaño blamed Sumayang for the on various aspects of safety driving including
accident. He testified that when he first blew the horn pertinent traffic regulations. They also confirmed the
the motorcycle which was about 15 or 20 meters thorough checkup of every vehicle before it would
 depart and that the performance of the drivers was at a junction, where adjoining roads had brought about merging and
being monitored by several inspectors posted at diverging traffic.
random places along the route.'
The appellate court opined that Metro Cebu had shown laxity in the
"In judgment, the lower court found [petitioners] liable to the conduct of its operations and in the supervision of its employees. By
[respondents], in the amounts of P30,000.00 for death allowing the bus to ply its route despite the defective speedometer,
indemnity, P829,079 for loss of earning capacity of the said petitioner showed its indifference towards the proper
deceased Ananias Sumayang, and P36,000.00 for necessary maintenance of its vehicles. Having failed to observe the extraordinary
interment expenses. The liability of defendant Perla diligence required of public transportation companies, it was held
Compania de Seguros, Inc., however, was limited only to the vicariously liable to the victims of the vehicular accident.
amount stipulated in the insurance policy, which [was]
P12,000 for death indemnity and P4,500.00 for burial In accordance with prevailing jurisprudence, the CA raised to P50,000
expenses. the granted indemnity for the death of the victim. It also affirmed the
award of loss of earning capacity based on his life expectancy. Such
"In so ruling, the lower court found [Petitioner] Pestaño to liability was assessed, not as a pension for the claiming heirs, but as a
have been negligent in driving the passenger bus that hit the penalty and an indemnity for the driver's negligent act.
deceased. It was shown that Pestaño negligently attempted to
overtake the motorcycle at a dangerous speed as they were Hence, this Petition.4
coming upon a junction in the road, and as the motorcycle was
about to turn left towards Tabagon. The court likewise found Issues
Metro Cebu directly and primarily liable, along with Pestaño,
the latter's employer under Article 2180 of the Civil Code, as Petitioners submit the following issues 5 for our consideration:
[Petitioner] Metro Cebu failed to present evidence to prove
that it had observed . . . [the] diligence of a good father of a 1) The Court of Appeals misapplied facts of weight and
family to prevent damage. Nor has Metro Cebu proven that it
substance affecting the result of the case.
had exercised due diligence in the supervision of its
employees and in the maintenance of vehicles."3
2) The Court of Appeals misapplied R.A. 4136 as regards the
behavior of the deceased at the time of the accident.
Ruling of the Court of Appeals
3) The Court of Appeals erred in ruling that the award of
The CA affirmed respondent's liability for the accident and for damages representing income that deceased could have
Sumayang's death. Pestaño was negligent when he tried to overtake
earned be considered a penalty.
the victim's motorcycle at the Tabagon junction. As a professional
driver operating a public transport vehicle, he should have taken extra
4) The Court of Appeals, contrary to Article 2204, Civil Code,
precaution to avoid accidents, knowing that it was perilous to overtake
raised the award of P30,000.00 damages representing
indemnity for death to P50,000.00.
 5) The Court of Appeals used as basis for the loss of earning left arm to signal that he was turning left to Tabagon, but that the latter
capacity, the life expectancy of the [d]eceased instead of that and his companion were thrown off the motorcycle after it was
of the respondents which was shorter."6 bumped by the overspeeding bus.

In short, they raise these questions: whether the CA erred (1) in These contentions have already been passed upon by the trial and the
applying Section 45 of RA 4136 when it ruled that negligence in appellate courts. We find no cogent reason to reverse or modify their
driving was the proximate cause of the accident; (2) in increasing the factual findings. The CA agreed with the trial court that the vehicular
civil indemnity from P30,000 to P50,000; and (3) in using the life collision was caused by Pestaño's negligence when he attempted to
expectancy of the deceased instead of the life expectancies of overtake the motorcycle. As a professional driver operating a public
respondents. transport bus, he should have anticipated that overtaking at a junction
was a perilous maneuver and should thus have exercised extreme
The Court's Ruling caution.

The Petition has no merit. Factual findings of the CA affirming those of the trial court are
conclusive and binding on this Court. Petitioners failed to demonstrate
First Issue: Negligence that this case falls under any of the recognized exceptions to this
rule.7 Indeed, the issue of negligence is basically factual and, in quasi-
Petitioners contend that Pestaño was not under any obligation to slow delicts, crucial in the award of damages.
down when he overtook the motorcycle, because the deceased had
given way to him upon hearing the bus horn. Seeing that the left side Petitioners aver that the CA was wrong in attributing the accident to a
of the road was clearly visible and free of oncoming traffic, Pestaño faulty speedometer and in implying that the accident could have been
accelerated his speed to pass the motorcycle. Having given way to the avoided had this instrument been properly functioning.
bus, the motorcycle driver should have slowed down until he had been
overtaken. This contention has no factual basis. Under Articles 2180 and 2176 of
the Civil Code, owners and managers are responsible for damages
They further contend that the motorcycle was not in the middle of the caused by their employees. When an injury is caused by the negligence
road nearest to the junction as found by the trial and the appellate of a servant or an employee, the master or employer is presumed to be
courts, but was on the inner lane. This explains why the damage on negligent either in the selection or in the supervision of that employee.
the bus were all on the right side - the right end of the bumper and the This presumption may be overcome only by satisfactorily showing
right portion of the radiator grill were bent and dented. Hence, they that the employer exercised the care and the diligence of a good father
insist that it was the victim who was negligent. of a family in the selection and the supervision of its employee. 8

We disagree. Petitioners are raising a question of fact based on The CA said that allowing Pestaño to ply his route with a defective
Pestaño's testimony contradicting that of Eyewitness Ignacio Neis and speedometer showed laxity on the part of Metro Cebu in the operation
on the location of the dents on the bumper and the grill. Neis testified of its business and in the supervision of its employees. The negligence
that as the two vehicles approached the junction, the victim raised his alluded to here is in its supervision over its driver, not in that which
directly caused the accident. The fact that Pestaño was able to use a The award for loss of earning capacity is based on two factors: (1) the
bus with a faulty speedometer shows that Metro Cebu was remiss in number of years on which the computation of damages is based and
the supervision of its employees and in the proper care of its vehicles. (2) the rate at which the loss sustained by the heirs is fixed. 14 The first
It had thus failed to conduct its business with the diligence required factor refers to the life expectancy, which takes into consideration the
by law. nature of the victim's work, lifestyle, age and state of health prior to
the accident. The second refers to the victim's earning capacity minus
Second Issue: Life Indemnity the necessary living expenses. Stated otherwise, the amount
recoverable is that portion of the earnings of the deceased which the
Petitioners aver that the CA erred in increasing the award for life beneficiary would have received — the net earnings of the deceased.15
indemnity from P30,000 to P50,000, without specifying any
aggravating circumstance to justify the increment as provided in the WHEREFORE, the Petition is DENIED and the assailed Decision and
Civil Code.9 Resolution AFFIRMED. Cost against petitioners.

This contention is untenable. The indemnity for death caused by a

quasi-delict used to be pegged at P3,000, based on Article 2206 of the
Civil Code. However, the amount has been gradually increased
through the years because of the declining value of our currency. At
present, prevailing jurisprudence fixes the amount at P50,000. 10

Third Issue: Loss of Earning Capacity

Petitioners cite Villa Rey Transit, Inc. v. Court of Appeals, 11 which

held:

"The determination of the indemnity to be awarded to the heirs of a

deceased person has therefore no fixed basis. . . . The life expectancy
of the deceased or of the beneficiary, whichever is shorter, is an
important factor . . . "

They contend that the CA used the wrong basis for its computation of
earning capacity.

We disagree. The Court has consistently computed the loss of earning

capacity based on the life expectancy of the deceased, 12 and not on that
of the heir.13 Even Villa Rey Transit did likewise.
G.R. No. 139436 January 25, 2006 Pawnshop agreed to the extension of the maturity date to June 30,
1992, provided the Salvadors pay 20% of their second loan obligation
ENRICO B. VILLANUEVA and EVER PAWNSHOP, Petitioners, on or before June 4, 1992, failing which the securing items shall be
vs. auctioned as scheduled. Unlike in the first loan, however, a new pawn
SPS. ALEJO SALVADOR and VIRGINIA ticket was not issued for the second loan.
SALVADOR, Respondents.
In the meantime, Ever Pawnshop issued a notice announcing the
DECISION public auction sale on June 4, 1992 of all January 1 to 31, 1992
unredeemed pledges. The notice appeared in the Classified Ads
GARCIA, J.: Section of the Manila Bulletin on June 4, 1992, the very day of the
auction itself.
Assailed and sought to be set aside in this petition for review
on certiorari under Rule 45 of the Rules of Court is the July 16, 1999 On July 1, 1992, the Salvadors repaired to the pawnshop in a bid to
decision1 of the Court of Appeals (CA) in CA-G.R. CV No. 49965, renew the second loan by tendering the aforesaid 20% of the amount
which affirmed in toto an earlier decision2 of the Regional Trial Court due thereon, only to be informed that the pledged jewelry had already
(RTC) at Pasig in Civil Case No. 62334. been auctioned as scheduled on June 4, 1992. As found by the CA,
however, pieces of the pawned jewelry items were still in the
The pertinent facts: shop, 3 indicating that Ever Pawnshop either bought some of the
unredeemed pledges or did not sell them.
On December 20, 1991, herein respondents, the spouses Alejo
Salvador and Virginia Salvador (Salvadors, collectively), secured a A month after, Mrs. Salvador attempted to redeem the jewelry items
loan of P7,650.00 from petitioner Ever Pawnshop owned and managed pledged for the first loan, as renewed, but all she got in response were
by co-petitioner Enrico B. Villanueva (Villanueva). On January 23, unclear information as to their whereabouts.
1992, the Salvadors took out a second loan of P5,400.00 pledging, just
like in the first loan transaction, jewelry items. Pawnshop Ticket No. On August 7, 1992, Mr. Salvador tendered payment of the amount due
29919, covering the first loan, indicated April 10, 1992 as the last day on both loans, with a demand for the return of the jewelry thus
to redeem the jewelries pawned, whereas the redemption period for pledged. Ever Pawnshop, however, refused to accept the tender.
the items given as security for the second loan under Pawnshop Ticket
No. 30792 fell on May 22, 1992. Such was the state of things when, on August 11, 1992, at the RTC-
Pasig City, the Salvadors filed a complaint for damages against
The separate redemption periods came and went, but the Salvadors Villanueva and Ever Pawnshop arising from the sale without notice of
failed to redeem the pawned pieces of jewelry. Nonetheless, on June the two (2) sets of jewelry pledged as security for both loans. The
1, 1992, their son paid Ever Pawnshop P7,000.00, the amount to be complaint, docketed as Civil Case No. 62334, was eventually raffled
applied against the first loan of P7,650.00. On account of this to Branch 164 of the court.
development, Pawnshop Ticket No. 29919 was cancelled and replaced
by Pawnshop Ticket No. 34932. Vis-à-vis the second loan, Ever
Barely two days after Villanueva et al., received summons, their The counterclaim of the defendants is dismissed.
counsel informed the Salvadors of his clients’ willingness to accept
payment heretofore tendered for the redemption of the jewelry SO ORDERED. (Words in bracket added.)
pledged to secure the first loan. The Salvadors, however, turned down
this belated offer. Therefrom, petitioners went on appeal to the CA whereat their
recourse was docketed as CA-G.R. CV No. 49965.
Answering, Villanueva and Ever Pawnshop, as defendants a quo,
averred, inter alia, that by letters dated March 23, 1992 and May 5, As stated at the threshold hereof, the CA, in its decision of July 16,
1992, Ever Pawnshop reminded the Salvadors of the maturity dates 1999, affirmed in toto that of the trial court, the affirmance being
and redemption period of their loans. Also alleged in the answer with predicated on the following main justifications:
counterclaim for damages was the publication in the June 4, 1992 issue
of the Manila Bulletin of the notice of public auction of all As the trial court correctly pointed out, the May 5, 1992 "List of
unredeemed pledges from January 1 to 31, 1992. Notified Clients" (Exhs. 6, 6-A, 6-B ) . . . including the names of the
[respondents] and Ticket Nos. 29919 and 30792 is not proof that
Eventually, in a decision4 dated January 25, 1995, the trial court, on notices were actually sent to [respondents]. While the list contains 132
its finding that the set of jewelry covered by the renewed first and names, only 98 [postage] stamps were purchased, hence, it cannot be
second loans were sold without the necessary notice, rendered determined who among the 132 people were sent notices.
judgment for the Salvadors, to wit:
And as surmised by the trial court, the set of jewelry pledged to secure
WHEREFORE, the Court hereby renders judgment in favor of the the first loan must have been auctioned, as scheduled on May 7, 1992,
plaintiffs [Salvadors] and against the defendants [Villanueva and Ever but that by mistake the pledge was renewed (on June 1, 1992), that is
Pawnshop]. Defendants are hereby ordered to pay to the plaintiffs: why it was only after the [petitioners] received the summons in late
August 1992 when probably they recovered the pledged jewelry that
1. The sum of P20,000.00 by way of moral damages; they expressed willingness to accept the [respondents’] tender of
payment for the redemption of said pledge jewelry securing the first
2. The sum of P5,400.00 as the value of the jewelry sold under (renewed) loan.
the second loan;
Admittedly, the [respondents] did not pay their loans on maturity. But
3. The sum of P5,000.00 as and for attorney’s fees; and [petitioners] breached their contractual and legal obligation to inform
the [respondents] of the public auction of the jewelry securing it.
4. The costs of suit.
Furthermore, [petitioners] failed to comply with the requirements . . .
Defendants are also ordered to restore to the possession of the that the notice must be published during the week preceding the sale
[Salvadors] the jewelry that they pawned under the first loan, covered in two daily newspapers of general circulation in the city or
by pawn ticket nos. 29919 and 34932, upon payment by the plaintiffs municipality. The paid notice of public auction to be held on June 4,
of the redemption price due last 10 August 1992. 1992 by Ever Pawnshop was published only on even date, and only in
one newspaper, the Manila Bulletin. And particularly with respect to – on the disposition of the set of jewelry covered by Pawnshop Ticket
the second loan, why was the jewelry pledged to secure it included in No. 34932. Such issue is beyond the province of the Court to review
the June 4, 1992 auction when plaintiffs had up to that date to pay 20% since it is not its function to analyze or weigh all over again the
of the amount due thereunder as a condition to its renewal? evidence or premises supportive of such factual determination. 5 The
Court has consistently held that the findings of the CA must be
xxx xxx xxx accorded great weight and shall not be disturbed on appeal, save for
the most compelling and cogent reasons,6 like when manifest error has
Anent the questioned award of moral damages: Even assuming that been committed.7
[respondents’] failure to pay their obligation on maturity amounts to
contributory negligence, that does not abate the award of moral As nothing in the record indicates any of such exceptions, the factual
damages in their favor given the [petitioners’] failure to comply with conclusion of the CA that petitioners indeed sold the jewelry items
the contractual and statutory requirements before the pledged jewelry given to secure the first loan must be affirmed.
was auctioned which failure amounts to misconduct contemplated in
Article 2220 of the New Civil Code – basis of the award thereof Indeed, petitioner pawnshop expressed willingness to accept tender of
(Laguna Tayabas Bus Company v. Cornista 11 SCRA 181- 182 payment and to return the pawned jewelry only after being served with
(Words in bracket added) summons. Apparently, Ever Pawnshop had found a way to recover
said jewelry by that time. If, as aptly observed by the CA, the jewelry
Hence, this petition on the following issues: had never been sold, as petitioners so allege, but had been in their
possession all along, they could have provided a plausible explanation
1. Whether the items of jewelry under the first loan were for the initial refusal to accept tender of payment and to return the
actually sold by the petitioners; jewelry. Petitioners’ belated overture to accept payment after spurning
the initial offer to pay can only be due to the fact that, when
2. Whether valid notice of the sale of the pledged jewelry was respondents offered to pay the first time around, they (petitioners) no
effected; longer had possession of the jewelry items in question, having
previously disposed of them.
3. Whether the award of P20,000.00 as moral damages
and P5,000.00 as attorneys fees are proper; and Moving on to the second issue, petitioners argue that the respondents
were effectively put on notice of the sale of the pledged jewelries, the
4. Whether the trial and appellate courts erred in ordering both maturity date and expiry date of redemption period of the two loans
being indicated on the face of each of the covering pawnshop tickets.
the petitioners to pay damages.
Pressing the point, petitioners invite attention to the caveat printed on
the dorsal side of the tickets stating that the pledged items shall be
Under the first issue, petitioners fault the CA in holding that the
auctioned off in the event they are not redeemed before the expiry date
jewelry pledged under the first loan was sold by them.
of the redemption period.
Doubtless, the first issue raised by petitioners relates to the correctness
We are not persuaded by petitioners’ faulty argument.
of the factual finding of the CA – confirmatory of that of the trial court
Section 13 of Presidential Decree (P.D.) 114, otherwise known as While proof of pecuniary loss is unnecessary to justify an award of
the Pawnshop Regulation Act, and even the terms and conditions of moral damages, the amount of indemnity being left to the sound
the pledge itself, accord the pawner a 90-day grace period from the discretion of the court, it is, nevertheless, essential that the claimant
date of maturity of the loan obligation within which to redeem the satisfactorily proves the existence of the factual basis of the
pawn. But even before the lapse of the 90-day period, the same Decree damages9 and its causal connection to defendant’s wrongful act or
requires the pawnbroker to notify the defaulting debtor of the proposed omission. This is so because moral damages, albeit incapable of
auction sale. Section 14 thereof provides: pecuniary estimation, are designed to compensate the claimant for
actual injury suffered and not to impose a penalty on the
Section 14. Disposition of pawn on default of pawner.—In the event wrongdoer.10 There is thus merit on petitioners’ assertion that proof of
the pawner fails to redeem the pawn within ninety days from the date moral suffering must precede a moral damage award. 11
of maturity of the obligation . . ., the pawnbroker may sell . . . any
article taken or received by him in pawn: Provided, however, that the The conditions required in awarding moral damages are: (1) there
pawner shall be duly notified of such sale on or before the termination must be an injury, whether physical, mental or psychological, clearly
of the ninety-day period, the notice particularly stating the date, hour sustained by the claimant; (2) there must be a culpable act or omission
and place of the sale. factually established; (3) the wrongful act or omission of the defendant
must be the proximate cause of the injury sustained by the claimant;
However, over and above the foregoing prescription is the mandatory and (4) the award of damages is predicated on any of the cases stated
requirement for the publication of such notice once in at least two daily in Article 2219 of the Civil Code. 12
newspapers during the week preceding the date of the auction sale.8
While there need not be a showing that the defendant acted in a wanton
The CA cannot really be faulted for making short shrift of petitioners’ or malevolent manner, as this is a requirement for an award
posture respecting their alleged compliance with the notice of exemplary damages,13 there must still be proof of fraudulent action
requirement in question. As it were, petitioner Ever Pawnshop, as or bad faith for a claim for moral damages to succeed. 14 Then, too,
determined by the CA, only caused publication of the auction in one moral damages are generally not recoverable in culpa
newspaper, i.e., the Manila Bulletin, and on the very day of the contractual except when bad faith supervenes and is proven.15
scheduled auction sale itself, instead of a week preceding the sale as
prescribed by Section 15 of P.D. 114. Verily, a notice of an auction Bad faith does not simply connote bad judgment or negligence; it
sale made on the very scheduled auction day itself defeats the purpose imports a dishonest purpose or some moral obliquity and conscious
of the notice, which is to inform a pawner beforehand that a sale is to doing of a wrong, a breach of known duty through some motive or
occur so that he may have that last chance to redeem his pawned items. interest or ill-will that partakes of the nature of the fraud.16 And to the
person claiming moral damages rests the onus of proving by
This brings us to the issue of the award of moral damages which convincing evidence the existence of bad faith, for good faith is
petitioners correctly tag as erroneous, and, therefore, should be presumed.17
deleted.
As aptly pointed out by petitioners, the trial court concluded that the
respondents’ "cause of action arose merely from the negligence of the
herein [petitioners]."18 It may be that gross negligence may sometimes the factual, legal or equitable justification for the award must be set
amount to bad faith.19 But what is before us is a matter of simple forth in the text of the decision.22 The matter of attorney’s fees cannot
negligence only, it being the trial court’s categorical finding that the be touched only in the fallo of the decision, else the award should be
case came about owing to petitioners’ mistake in renewing the loan thrown out for being speculative and conjectural. 23
when the sale of the article to secure the loan had already been
effected. Wrote the trial court: Certainly not lost on the Court is the fact that petitioners, after being
served with summons, made an attempt to obviate litigation by
"What must have happened next was that the jewelry under the first offering to accept tender of payment and return the jewelry. This offer,
loan was sold, as scheduled, on 7 May 1992. Due to an oversight, the however belated, could have saved much expense on the part of both
defendants mistakenly renewed the first loan on 1 June 1992, issuing parties, as well as the precious time of the court itself. The respondents
pawn ticket number 34932 in the process."20 [Emphasis supplied] chose to turn down this offer and pursue judicial recourse. With this
in mind, it hardly seems fair to award them attorneys fees at
The CA’s reliance on Article 2220 of the Civil Code in affirming the petitioners’ expense.
award of moral damages is misplaced. Said article provides:
The final issue relating to the question of whether or not both
Art. 2220. Willful injury to property may be a legal ground for respondents are liable for damages has, for all intent and purposes,
awarding moral damages if the court should find that, under the been rendered moot and academic by the disposition just made. We
circumstances, such damages are justly due. The same rule applies to need not dwell on it any further. Besides, this particular issue has only
breaches of contract where the defendant acted fraudulently or in bad made its debut in the present recourse. And it is a well-entrenched rule
faith. that issues not raised below cannot be resolved on review in higher
courts.24 A question that was never raised in the court below cannot be
Clear it is from the above that before moral damages may be assessed allowed to be raised for the first time on appeal without offending
thereunder, the defendant’s act must be vitiated by bad faith or that basic rules of fair play, justice and due process. 25
there is willful intent to injure. Simply put, moral damages cannot
arise from simple negligence. WHEREFORE, with the MODIFICATION that the awards of
moral damages and attorneys fees are deleted, the decision under
The award of attorney’s fees should, likewise, be struck down, both review is hereby AFFIRMED.
the CA and trial court having failed to explain respondents’
entitlement thereto. As a matter of sound practice, an award of No pronouncement as to cost.
attorney’s fee has always been regarded as the exception rather than
the rule. Counsel’s fees are, to be sure, not awarded every time a party SO ORDERED.
prevails in a suit because of the policy that no premium should be
placed on the right to litigate. Attorney’s fees, as part of damages, are
assessed only in the instances specified in Article 2208 of the Civil
Code. 21 And it is necessary for the trial court to make express findings
of fact and law that would bring the case within the exception. In short,
G.R. No. 127957 February 21, 2001 At 1:30 in the afternoon of February 14, 1978, a limousine service of
the travel agency fetched petitioner Morris at his house in Urdaneta
COLLIN A. MORRIS and THOMAS P. WHITTIER, petitioner, Village, Makati City. Thereafter, they went to Merville Park,
vs. Parañaque and fetched petitioner Whittier, arriving there at around
COURT OF APPEALS (Tenth Division) and SCANDINAVIAN 2:00 in the afternoon. From Parañaque, they went to the Manila
AIRLINES SYSTEM, respondents. International Airport and arrived at 2:35 in the afternoon.

PARDO, J.: Upon arrival at the airport, representatives of the travel agency met
petitioners. It took petitioners two to three minutes to clear their bags
Petitioners appeal via certiorari from the decision1 of the Court of at the customs section. After that, they proceed to the SAS check-in
Appeals, which reversed the decision of the trial court and ordered the counter and presented their tickets, passports, immigration cards and
dismissal of petitioners' complaint for damages against respondent for travel documents to Ms. Erlinda Ponce at the reception desk.
breach of contract of air carriage.
After about fifteen (15) minutes, petitioners noticed that their travel
On February 14, 1978, petitioners filed with the Regional Trial Court, documents were not being processed at the check-in counter. They
Makati branch 143 an action for damages for breach of contract of air were informed that there were no more seats on the plane for which
carriage against respondent airline because they were bumped off reason they could not be accommodated on the flight.
from SAS Flight SK 893, Manila-Tokyo, on February 14, 1978,
despite a confirmed booking in the first class section of the flight. Petitioner Morris contacted Staats Travel Service and asked the latter
to contact the management of SAS to find out what was the problem.
Petitioners Collin A. Morris and Thomas P. Whittier were American After ten (10) minutes, Staats Travel Service called and confirmed
citizens; the vice-president for technical service and the director for their booking. Thereafter, petitioner Morris and Whittier returned to
quality assurance, respectively, of Sterling Asia, a foreign corporation respondent's check-in counter anticipating that they would be allowed
with regional headquarters at No. 8741 Paseo de Roxas, Makati City. to check-in. However, the check-in counter was closed. When they
informed Ms. Ponce, in charge at the check-in counter that
Respondent Scandinavian Airline System (SAS for brevity) is and at arrangements had been made with respondents office, she ignored
times material hereto has been engaged in the commercial air transport them. Even respondent's supervisor, Raul Basa, ignored them and
of passengers globally. refused to answer their question why they could not be accomodated
in the flight despite their confirmed booking.
Petitioner Morris and co-petitioner Whittier had a series of business
meetings with Japanese businessmen in Japan from February 14 to When petitioners went to the supervisor's desk to check the flight
February 22, 1978. They requested their travel agent, Staats Travel manifest, they saw that their names on top of the list of the first class
Service. Inc. to book them as first class passengers in SAS Manila- section had been crossed out. They pressed the supervisor to allow
Tokyo flight on February 14, 1978. Respondent booked them as first- them in the flight as they had confirmed tickets. Mr. Basa informed
class passengers on Flight SK 893, Manila-Tokyo flight on February them that it could not be done because the flight was closed and it was
14, 1978, at 3:50 in the afternoon. too late to do anything. They checked in at exactly 3:10 in the
afternoon and the flight was scheduled to leave Manila International He learned from Ms. Ponce that petitioners checked in late after the
Airport at 3:50 in the afternoon.2 flight manifest had been closed, after which time waitlisted passengers
from the economy class had been upgraded. He explained to
Petitioner Morris said that they were advised to be at the airport at petitioners that they could not be accommodated on the plane because
least an hour before departure time. This has been respondent's policy the seats were all filled up. He admitted that there were about six (6)
in petitioner's previous travels abroad.3 passengers in the counter who were refused boarding because
waitlisted passengers had been accepted. Most of those who were
Ms. Erlinda Ponce, SAS employee on duty at the check-in counter on refused boarding came in late.6
February 14, 1978 testified that the economy class of SAS Flight SK
893 was overbooked; however, the first class section was open. She Alice Magtulac, another witness of the respondent, testified that she
met petitioners, who were booked in the first class section, when they was supervisor of ticketing and reservation section. She said that
approached the counter to check-in. They not accomodated on the petitioners Morris and Whittier had confirmed reservation tickets to
flight because they checked-in after the flight manifest had been the first class section of SAS Flight SK 893, Manila-Tokyo flight, on
closed forty (40) minutes prior to the plane's departure. Petitioners' February 14, 1978. She confirmed that Ms. Thelma Lorraine Sayer
seats were given to economy class passengers who were upgraded to was one of the economy class passengers who was not able to leave
first class.4 because the flight was overbooked on the economy class.

Upon cross-examination, Ms. Ponce sait that petitioners might have Ms. Magtulac said that it was not SAS' policy to upgrade economy
arrive at the airport earlier than 3:10 in the afternoon when the flight passenger to first class if passengers booked for first class did not show
manifest was closed; she was sure that they arrived at the check-in up.7
counter at past 3:10 in the afternoon. The first class seats ot petitioners
were given to upgraded economy class passengers three (3) minutes On August 24, 1988, the trial court rendered a judgement against
before the flight manifest was closed.5 respondent and in favor of petitioners Morris and Whittier. The
dispositive portion reads:
Raul Cruz Basa, a supervisor of respondent airline company, testified
that SAS Flight SK 893 on February 14, 1978 was overbooked in the "WHEREFORE, in view of the foregoing, the Court
economy class. Petitioner. Morris and Whittier were among the names hereby renders judgement in favor of the plaintiffs
listed in the first class section of the flight manifest. However, their and against defendant, ordering the latter to pay the
names were crossed out and the symbols "NOSH", meaning NO former the following:
SHOW, written after their names. The "NO SHOW" notation could
mean either that the booked passengers of his travel documents were 1. Moral damages to plaintiff Collin A. Morris in the
not at the counter at the time of the closing of the flight manifest. amount of P1,000,000.00 and to plaintiff Thomas P.
Whittier the sum of P750,000.00;
Mr. Basa said that he talked to petitioners at about 3:20 in the
afternoon after receiving a radio call from the ground staff at the 2. Exemplary damages in the sum of P200,00.00;
check-in counter about complaints from passengers.
 3. Attorney's fees in the amount of P300,000.00, plus "Makati, Metro Manila, February 26, 1992.
the costs of suit.
[ORIGINAL SIGNED]
"Makati, Metro Manila, August 24, 1988

[ORIGINAL SIGNED]
TEOFILO GUADIZ, JR.
J u d g d e"11

TEOFILO GUADIZ, JR. Respondent's appeal rested mainly on the ground that the trial court
J u d g d e"8 misappreciated the facts and evidence adduced during the trial. The
thrust of its defense was petitioners' lack of cause of action,
On October 5, 1988, respondent filed a notice of appeal. 9 considering that they checked-in at the SAS counter at the Manila
International Airport after the flight manifest was closed and after their
Meanwhile, on October 6, 1988, petitioners Morris and Whittier first class seats were given to waitlisted economy class passengers.12
moved for reconsideration of the decision as regards the award of
damages. On January 21, 1997, the Court of Appeals Promulgated a decision
reversing the decision of the court a quo, and ordering the dismissal
On November 2, 1988, respondent opposed the motion for of the complaint for damages. The dispositive portion of the decision
reconsideration. 10 provides:

On February 26, 1992, the trial court issued an order granting "WHEREFORE, the appealed decision is hereby
petitioners' motion for reconsideration, the decretal portion of which REVERSED and SET ASIDE and another one
is quoted herein, to wit: rendered dismissing plaintiffs-appellees' complaint.

"WHEREFORE, in view of the foregoing, the Court SO ORDERED."13

hereby grants the "Motion for Reconsideration". The
dispositive portion of the "Decision" is hereby In reversing the trial court's decision, the Court of Appeals found
amended with respect to the amount of moral petitioners' statement self-serving. Petitioners failed to prove that they
damages, ordering the defendant to pay moral checked-in on time. The appellate court lent credence to respondent's
damages to Collin Morris in the amount of claim that petitioners were denied boarding on SAS Flight SK 893
P1,500,000.00 and to Thomas whittier the amount of because of their late arrival for check-in at the international airport.
P1,000.000.00. Respondent's employee, Ms. Erlinda Ponce, testified that petitioners
checked in after the flight manifest was closed.
"SO ORDERED.
Hence, this petition.14 the same damages may be recovered when reach of contract of
carriage results in the death of a passenger."19
Petitioners allege that the Court of Appeals gravely erred in dismissing
their complaint for damages and in finding their testimonies self- "The award of exemplary damages has likewise no factual basis. It is
serving. They contend that the trial court did not act arbitrarily in requisite that the act must be accompanied by bad faith or done in
lending credence to their testimonies and finding their evidence wanton, fraudulent or malevolent manner—circumstances which are
sufficient to warrant the award of damages against respondent. In sum, absent in this case. In addition, exemplary damages cannot be awarded
they claim to be entitled to the award for damages because, as found as the requisite element of compensatory damages was not present." 20
by the trial court, they were wrongfully and in bad faith, "bumped-off"
from SAS Flight SK 893 on February 14, 1978, despite their timely In the instant case, assuming arguendo that breach of contract of
arrival at the airport for check-in and confirmed bookings as first class carriage may be attributed to respondent, petitioners' travails were
passengers.15 directly traceable to their failure to check-in on time, which lewd to
respondent's refusal to accommodate them on the flight.
The petition has no merit.
"The rule is that moral damages are recoverable in a damage suit
"To begin with, it must be emphasized that a contract to transport predicated upon a breach of contract of carriage only where (a) the
passengers is quite different kind and degree from any other mishap result in the death of a passenger and (b) it is proved that the
contractual relations, and this is because relation, which an air carrier carrier was guilty of fraud and bad faith even if death does not
sustains with the public. Its business is mainly with the travelling result."21
public. It invites people business is mainly with the traveling public.
It invites people to avail [themselves] of the comforts and advantages For having arrived at the airport after the closure of the flight manifest,
it offers. The contract of air carriage, therefore, generates a relation respondent's employee could not be faulted for not entertaining
attended wit h a pubic duty. Neglect or malfeasance of the carrier's petitioners' tickets and travel documents for processing, as the
employees naturally could give ground for an action for damages." 16 checking in of passengers for SAS Flight SK 893 was finished, there
was no fraud or bad faith as would justify the court's award or normal
"In awarding moral damages for breach of contract of carriage, the damages.
breach must be wanton and deliberately injurious or the one
responsible acted fraudulently or with malice or bad faith."17 "Where "Bad faith does not simply connote bad judgement or negligence, it
in breaching the contract of carriage the defendant airline is not shown imports a dishonest purpose or some moral obliquity and conscious
to have acted fraudulently or in bad faith, liability for damages is doing of a wrong, a breach of known duty through some motive or
limited to the natural and probable consequences of the breach of interest or ill will that partakes of the nature of fraud."22
obligation which the parties had foreseen or could have reasonably
foreseen. In that case, such liability does not include moral and In the instant case, respondent's denial of petitioners' boarding on SAS
exemplary damages."18 "Moral damages are generally not recoverable Flight 893 was not attended by bad faith or malice.
in culpa contractual except when bad faith had been proven. However,
To the contrary, facts revealed that they were not allowed to board the
plane due to their failure to check-in on time. Petitioner Morris
admitted that they were at the check-in counter at around 3:10, exactly
the same time the flight manifest was closed, but still too late to be
accommodated on the plane. Respondent's supervisor, Raul C. Basa,
testified that he met petitioners at about 3:20 in the afternoon after
receiving a radio call from the ground staff regarding petitioners'
complaints. Clearly did not arrive on time for check-in.

As we find petitioners not entitled to moral damages, "an award of

exemplary damages is likewise baseless."23 "Where the award of
moral and exemplary damages is eliminated, so must the award for
attorney's fees be deleted."24

WHEREFORE, the Court DENIES the petition for lack of merit. The
Court AFFIRMS in toto decision of the Court of Appeals in CA-G.R.
CV. No. 38684.

No Costs.

SO ORDERED.
FILIPINAS BROADCASTING NETWORK, INC., petitioner, damages7 against FBNI, Rima and Alegre on 27 February 1990.
vs. Quoted are portions of the allegedly libelous broadcasts:
AGO MEDICAL AND EDUCATIONAL CENTER-BICOL
CHRISTIAN COLLEGE OF MEDICINE, (AMEC-BCCM) and JUN ALEGRE:
ANGELITA F. AGO, respondents.
Let us begin with the less burdensome: if you have children taking
DECISION medical course at AMEC-BCCM, advise them to pass all subjects
because if they fail in any subject they will repeat their year level,
CARPIO, J.: taking up all subjects including those they have passed already.
Several students had approached me stating that they had consulted
The Case with the DECS which told them that there is no such regulation. If
[there] is no such regulation why is AMEC doing the same?
This petition for review1 assails the 4 January 1999 Decision2 and 26
January 2000 Resolution of the Court of Appeals in CA-G.R. CV No. xxx
40151. The Court of Appeals affirmed with modification the 14
December 1992 Decision3 of the Regional Trial Court of Legazpi City, Second: Earlier AMEC students in Physical Therapy had
Branch 10, in Civil Case No. 8236. The Court of Appeals held complained that the course is not recognized by DECS. xxx
Filipinas Broadcasting Network, Inc. and its broadcasters Hermogenes
Alegre and Carmelo Rima liable for libel and ordered them to Third: Students are required to take and pay for the subject even
solidarily pay Ago Medical and Educational Center-Bicol Christian if the subject does not have an instructor - such greed for money
College of Medicine moral damages, attorney’s fees and costs of suit. on the part of AMEC’s administration. Take the subject Anatomy:
students would pay for the subject upon enrolment because it is
The Antecedents offered by the school. However there would be no instructor for such
subject. Students would be informed that course would be moved to a
"Exposé" is a radio documentary4 program hosted by Carmelo ‘Mel’ later date because the school is still searching for the appropriate
Rima ("Rima") and Hermogenes ‘Jun’ Alegre ("Alegre"). 5 Exposé is instructor.
aired every morning over DZRC-AM which is owned by Filipinas
Broadcasting Network, Inc. ("FBNI"). "Exposé" is heard over Legazpi xxx
City, the Albay municipalities and other Bicol areas. 6
It is a public knowledge that the Ago Medical and Educational Center
In the morning of 14 and 15 December 1989, Rima and Alegre has survived and has been surviving for the past few years since its
exposed various alleged complaints from students, teachers and inception because of funds support from foreign foundations. If you
parents against Ago Medical and Educational Center-Bicol Christian will take a look at the AMEC premises you’ll find out that the names
College of Medicine ("AMEC") and its administrators. Claiming that of the buildings there are foreign soundings. There is a McDonald
the broadcasts were defamatory, AMEC and Angelita Ago ("Ago"), Hall. Why not Jose Rizal or Bonifacio Hall? That is a very concrete
as Dean of AMEC’s College of Medicine, filed a complaint for and undeniable evidence that the support of foreign foundations for
AMEC is substantial, isn’t it? With the report which is the basis of the xxx My friends based on the expose, AMEC is a dumping ground for
expose in DZRC today, it would be very easy for detractors and moral and physically misfit people. What does this mean? Immoral
enemies of the Ago family to stop the flow of support of foreign and physically misfits as teachers.
foundations who assist the medical school on the basis of the latter’s
purpose. But if the purpose of the institution (AMEC) is to deceive May I say I’m sorry to Dean Justita Lola. But this is the truth. The
students at cross purpose with its reason for being it is possible for truth is this, that your are no longer fit to teach. You are too old. As an
these foreign foundations to lift or suspend their donations aviation, your case is zero visibility. Don’t insist.
temporarily.8
xxx Why did AMEC still absorb her as a teacher, a dean, and chairman
xxx of the scholarship committee at that. The reason is practical cost
saving in salaries, because an old person is not fastidious, so long as
On the other hand, the administrators of AMEC-BCCM, AMEC she has money to buy the ingredient of beetle juice. The elderly can
Science High School and the AMEC-Institute of Mass get by – that’s why she (Lola) was taken in as Dean.
Communication in their effort to minimize expenses in terms of
salary are absorbing or continues to accept "rejects". For example xxx
how many teachers in AMEC are former teachers of Aquinas
University but were removed because of immorality? Does it mean xxx On our end our task is to attend to the interests of students. It is
that the present administration of AMEC have the total definite moral likely that the students would be influenced by evil. When they
foundation from catholic administrator of Aquinas University. I will become members of society outside of campus will be liabilities
prove to you my friends, that AMEC is a dumping ground, garbage, rather than assets. What do you expect from a doctor who while
not merely of moral and physical misfits. Probably they only qualify studying at AMEC is so much burdened with unreasonable
in terms of intellect. The Dean of Student Affairs of AMEC is Justita imposition? What do you expect from a student who aside from
Lola, as the family name implies. She is too old to work, being an old peculiar problems – because not all students are rich – in their struggle
woman. Is the AMEC administration exploiting the very [e]nterprising to improve their social status are even more burdened with false
or compromising and undemanding Lola? Could it be that AMEC is regulations. xxx9 (Emphasis supplied)
just patiently making use of Dean Justita Lola were if she is very old.
As in atmospheric situation – zero visibility – the plane cannot land, The complaint further alleged that AMEC is a reputable learning
meaning she is very old, low pay follows. By the way, Dean Justita institution. With the supposed exposés, FBNI, Rima and Alegre
Lola is also the chairman of the committee on scholarship in AMEC. "transmitted malicious imputations, and as such, destroyed plaintiffs’
She had retired from Bicol University a long time ago but AMEC has (AMEC and Ago) reputation." AMEC and Ago included FBNI as
patiently made use of her. defendant for allegedly failing to exercise due diligence in the
selection and supervision of its employees, particularly Rima and
xxx Alegre.

MEL RIMA: On 18 June 1990, FBNI, Rima and Alegre, through Atty. Rozil
Lozares, filed an Answer10 alleging that the broadcasts against AMEC
were fair and true. FBNI, Rima and Alegre claimed that they were controversial utterances, which are not found by this court to be
plainly impelled by a sense of public duty to report the "goings-on in really very serious and damaging, and there being no showing that
AMEC, [which is] an institution imbued with public interest." indeed the enrollment of plaintiff school dropped, defendants
Hermogenes "Jun" Alegre, Jr. and Filipinas Broadcasting Network
Thereafter, trial ensued. During the presentation of the evidence for (owner of the radio station DZRC), are hereby jointly and severally
the defense, Atty. Edmundo Cea, collaborating counsel of Atty. ordered to pay plaintiff Ago Medical and Educational Center-Bicol
Lozares, filed a Motion to Dismiss11 on FBNI’s behalf. The trial court Christian College of Medicine (AMEC-BCCM) the amount of
denied the motion to dismiss. Consequently, FBNI filed a separate ₱300,000.00 moral damages, plus ₱30,000.00 reimbursement of
Answer claiming that it exercised due diligence in the selection and attorney’s fees, and to pay the costs of suit.
supervision of Rima and Alegre. FBNI claimed that before hiring a
broadcaster, the broadcaster should (1) file an application; (2) be SO ORDERED. 13 (Emphasis supplied)
interviewed; and (3) undergo an apprenticeship and training program
after passing the interview. FBNI likewise claimed that it always Both parties, namely, FBNI, Rima and Alegre, on one hand, and
reminds its broadcasters to "observe truth, fairness and objectivity in AMEC and Ago, on the other, appealed the decision to the Court of
their broadcasts and to refrain from using libelous and indecent Appeals. The Court of Appeals affirmed the trial court’s judgment
language." Moreover, FBNI requires all broadcasters to pass with modification. The appellate court made Rima solidarily liable
the Kapisanan ng mga Brodkaster sa Pilipinas ("KBP") accreditation with FBNI and Alegre. The appellate court denied Ago’s claim for
test and to secure a KBP permit. damages and attorney’s fees because the broadcasts were directed
against AMEC, and not against her. The dispositive portion of the
On 14 December 1992, the trial court rendered a Decision12 finding Court of Appeals’ decision reads:
FBNI and Alegre liable for libel except Rima. The trial court held that
the broadcasts are libelous per se. The trial court rejected the WHEREFORE, the decision appealed from is hereby AFFIRMED,
broadcasters’ claim that their utterances were the result of straight subject to the modification that broadcaster Mel Rima
reporting because it had no factual basis. The broadcasters did not is SOLIDARILY ADJUDGED liable with FBN[I] and
even verify their reports before airing them to show good faith. In Hermo[g]enes Alegre.
holding FBNI liable for libel, the trial court found that FBNI failed to
exercise diligence in the selection and supervision of its employees. SO ORDERED.14

In absolving Rima from the charge, the trial court ruled that Rima’s FBNI, Rima and Alegre filed a motion for reconsideration which the
only participation was when he agreed with Alegre’s exposé. The trial Court of Appeals denied in its 26 January 2000 Resolution.
court found Rima’s statement within the "bounds of freedom of
speech, expression, and of the press." The dispositive portion of the Hence, FBNI filed this petition.15
decision reads:
The Ruling of the Court of Appeals
WHEREFORE, premises considered, this court finds for the
plaintiff. Considering the degree of damages caused by the
The Court of Appeals upheld the trial court’s ruling that the questioned FBNI raises the following issues for resolution:
broadcasts are libelous per se and that FBNI, Rima and Alegre failed
to overcome the legal presumption of malice. The Court of Appeals I. WHETHER THE BROADCASTS ARE LIBELOUS;
found Rima and Alegre’s claim that they were actuated by their moral
and social duty to inform the public of the students’ gripes as II. WHETHER AMEC IS ENTITLED TO MORAL
insufficient to justify the utterance of the defamatory remarks. DAMAGES;

Finding no factual basis for the imputations against AMEC’s III. WHETHER THE AWARD OF ATTORNEY’S FEES IS
administrators, the Court of Appeals ruled that the broadcasts were PROPER; and
made "with reckless disregard as to whether they were true or false."
The appellate court pointed out that FBNI, Rima and Alegre failed to IV. WHETHER FBNI IS SOLIDARILY LIABLE WITH
present in court any of the students who allegedly complained against RIMA AND ALEGRE FOR PAYMENT OF MORAL
AMEC. Rima and Alegre merely gave a single name when asked to DAMAGES, ATTORNEY’S FEES AND COSTS OF SUIT.
identify the students. According to the Court of Appeals, these
circumstances cast doubt on the veracity of the broadcasters’ claim
The Court’s Ruling
that they were "impelled by their moral and social duty to inform the
public about the students’ gripes."
We deny the petition.
The Court of Appeals found Rima also liable for libel since he
This is a civil action for damages as a result of the allegedly
remarked that "(1) AMEC-BCCM is a dumping ground for morally
defamatory remarks of Rima and Alegre against AMEC. 17 While
and physically misfit teachers; (2) AMEC obtained the services of
AMEC did not point out clearly the legal basis for its complaint, a
Dean Justita Lola to minimize expenses on its employees’ salaries;
reading of the complaint reveals that AMEC’s cause of action is based
and (3) AMEC burdened the students with unreasonable imposition
on Articles 30 and 33 of the Civil Code. Article 3018 authorizes a
and false regulations."16
separate civil action to recover civil liability arising from a criminal
offense. On the other hand, Article 3319 particularly provides that the
The Court of Appeals held that FBNI failed to exercise due diligence injured party may bring a separate civil action for damages in cases of
in the selection and supervision of its employees for allowing Rima defamation, fraud, and physical injuries. AMEC also invokes Article
and Alegre to make the radio broadcasts without the proper KBP 1920 of the Civil Code to justify its claim for damages. AMEC cites
accreditation. The Court of Appeals denied Ago’s claim for damages Articles 217621 and 218022 of the Civil Code to hold FBNI solidarily
and attorney’s fees because the libelous remarks were directed against
liable with Rima and Alegre.
AMEC, and not against her. The Court of Appeals adjudged FBNI,
Rima and Alegre solidarily liable to pay AMEC moral damages,
I.
attorney’s fees and costs of suit.
Whether the broadcasts are libelous
Issues
A libel23 is a public and malicious imputation of a crime, or of a vice about nor confirm the purported irregularities in AMEC from the
or defect, real or imaginary, or any act or omission, condition, status, Department of Education, Culture and Sports. Alegre testified that he
or circumstance tending to cause the dishonor, discredit, or contempt merely went to AMEC to verify his report from an alleged AMEC
of a natural or juridical person, or to blacken the memory of one who official who refused to disclose any information. Alegre simply relied
is dead.24 on the words of the students "because they were many and not because
there is proof that what they are saying is true."28 This plainly shows
There is no question that the broadcasts were made public and imputed Rima and Alegre’s reckless disregard of whether their report was true
to AMEC defects or circumstances tending to cause it dishonor, or not.
discredit and contempt. Rima and Alegre’s remarks such as "greed for
money on the part of AMEC’s administrators"; "AMEC is a dumping Contrary to FBNI’s claim, the broadcasts were not "the result of
ground, garbage of xxx moral and physical misfits"; and AMEC straight reporting." Significantly, some courts in the United States
students who graduate "will be liabilities rather than assets" of the apply the privilege of "neutral reportage" in libel cases involving
society are libelous per se. Taken as a whole, the broadcasts suggest matters of public interest or public figures. Under this privilege, a
that AMEC is a money-making institution where physically and republisher who accurately and disinterestedly reports certain
morally unfit teachers abound. defamatory statements made against public figures is shielded from
liability, regardless of the republisher’s subjective awareness of the
However, FBNI contends that the broadcasts are not malicious. FBNI truth or falsity of the accusation.29 Rima and Alegre cannot invoke the
claims that Rima and Alegre were plainly impelled by their civic duty privilege of neutral reportage because unfounded comments abound
to air the students’ gripes. FBNI alleges that there is no evidence that in the broadcasts. Moreover, there is no existing controversy involving
ill will or spite motivated Rima and Alegre in making the broadcasts. AMEC when the broadcasts were made. The privilege of neutral
FBNI further points out that Rima and Alegre exerted efforts to obtain reportage applies where the defamed person is a public figure who is
AMEC’s side and gave Ago the opportunity to defend AMEC and its involved in an existing controversy, and a party to that controversy
administrators. FBNI concludes that since there is no malice, there is makes the defamatory statement.30
no libel.
However, FBNI argues vigorously that malice in law does not apply
FBNI’s contentions are untenable. to this case. Citing Borjal v. Court of Appeals,31 FBNI contends that
the broadcasts "fall within the coverage of qualifiedly privileged
Every defamatory imputation is presumed malicious.25 Rima and communications" for being commentaries on matters of public
Alegre failed to show adequately their good intention and justifiable interest. Such being the case, AMEC should prove malice in fact or
motive in airing the supposed gripes of the students. As hosts of a actual malice. Since AMEC allegedly failed to prove actual malice,
documentary or public affairs program, Rima and Alegre should have there is no libel.
presented the public issues "free from inaccurate and misleading
information."26 Hearing the students’ alleged complaints a month FBNI’s reliance on Borjal is misplaced. In Borjal, the Court
before the exposé,27 they had sufficient time to verify their sources and elucidated on the "doctrine of fair comment," thus:
information. However, Rima and Alegre hardly made a thorough
investigation of the students’ alleged gripes. Neither did they inquire
[F]air commentaries on matters of public interest are privileged and Secondly, there is reason to believe that defendant radio broadcasters,
constitute a valid defense in an action for libel or slander. The doctrine contrary to the mandates of their duties, did not verify and analyze the
of fair comment means that while in general every discreditable truth of the reports before they aired it, in order to prove that they are
imputation publicly made is deemed false, because every man is in good faith.
presumed innocent until his guilt is judicially proved, and every false
imputation is deemed malicious, nevertheless, when the discreditable Alegre contended that plaintiff school had no permit and is not
imputation is directed against a public person in his public capacity, it accredited to offer Physical Therapy courses. Yet, plaintiff produced
is not necessarily actionable. In order that such discreditable a certificate coming from DECS that as of Sept. 22, 1987 or more than
imputation to a public official may be actionable, it must either be 2 years before the controversial broadcast, accreditation to offer
a false allegation of fact or a comment based on a false supposition. Physical Therapy course had already been given the plaintiff, which
If the comment is an expression of opinion, based on established certificate is signed by no less than the Secretary of Education and
facts, then it is immaterial that the opinion happens to be mistaken, as Culture herself, Lourdes R. Quisumbing (Exh. C-rebuttal). Defendants
long as it might reasonably be inferred from the facts. 32 (Emphasis could have easily known this were they careful enough to verify. And
supplied) yet, defendants were very categorical and sounded too positive when
they made the erroneous report that plaintiff had no permit to offer
True, AMEC is a private learning institution whose business of Physical Therapy courses which they were offering.
educating students is "genuinely imbued with public interest." The
welfare of the youth in general and AMEC’s students in particular is The allegation that plaintiff was getting tremendous aids from foreign
a matter which the public has the right to know. Thus, similar to the foundations like Mcdonald Foundation prove not to be true also. The
newspaper articles in Borjal, the subject broadcasts dealt with matters truth is there is no Mcdonald Foundation existing. Although a big
of public interest. However, unlike in Borjal, the questioned building of plaintiff school was given the name Mcdonald building,
broadcasts are not based on established facts. The record supports the that was only in order to honor the first missionary in Bicol of
following findings of the trial court: plaintiffs’ religion, as explained by Dr. Lita Ago. Contrary to the claim
of defendants over the air, not a single centavo appears to be received
xxx Although defendants claim that they were motivated by consistent by plaintiff school from the aforementioned McDonald Foundation
reports of students and parents against plaintiff, yet, defendants have which does not exist.
not presented in court, nor even gave name of a single student who
made the complaint to them, much less present written complaint or Defendants did not even also bother to prove their claim, though
petition to that effect. To accept this defense of defendants is too denied by Dra. Ago, that when medical students fail in one subject,
dangerous because it could easily give license to the media to malign they are made to repeat all the other subject[s], even those they have
people and establishments based on flimsy excuses that there were already passed, nor their claim that the school charges laboratory fees
reports to them although they could not satisfactorily establish it. Such even if there are no laboratories in the school. No evidence was
laxity would encourage careless and irresponsible broadcasting which presented to prove the bases for these claims, at least in order to give
is inimical to public interests. semblance of good faith.
As for the allegation that plaintiff is the dumping ground for misfits, misleading information. x x x Furthermore, the station shall
and immoral teachers, defendant[s] singled out Dean Justita Lola who strive to present balanced discussion of issues. x x x.
is said to be so old, with zero visibility already. Dean Lola testified in
court last Jan. 21, 1991, and was found to be 75 years old. xxx Even xxx
older people prove to be effective teachers like Supreme Court Justices
who are still very much in demand as law professors in their late years. 7. The station shall be responsible at all times in the
Counsel for defendants is past 75 but is found by this court to be still supervision of public affairs, public issues and commentary
very sharp and effective. So is plaintiffs’ counsel. programs so that they conform to the provisions and standards
of this code.
Dr. Lola was observed by this court not to be physically decrepit yet,
nor mentally infirmed, but is still alert and docile. 8. It shall be the responsibility of the newscaster,
commentator, host and announcer to protect public interest,
The contention that plaintiffs’ graduates become liabilities rather than general welfare and good order in the presentation of public
assets of our society is a mere conclusion. Being from the place affairs and public issues.36 (Emphasis supplied)
himself, this court is aware that majority of the medical graduates of
plaintiffs pass the board examination easily and become prosperous The broadcasts fail to meet the standards prescribed in the Radio Code,
and responsible professionals.33 which lays down the code of ethical conduct governing practitioners
in the radio broadcast industry. The Radio Code is a voluntary code of
Had the comments been an expression of opinion based on established conduct imposed by the radio broadcast industry on its own members.
facts, it is immaterial that the opinion happens to be mistaken, as long The Radio Code is a public warranty by the radio broadcast industry
as it might reasonably be inferred from the facts. 34 However, the that radio broadcast practitioners are subject to a code by which their
comments of Rima and Alegre were not backed up by facts. Therefore, conduct are measured for lapses, liability and sanctions.
the broadcasts are not privileged and remain libelous per se.
The public has a right to expect and demand that radio broadcast
The broadcasts also violate the Radio Code35 of the Kapisanan ng mga practitioners live up to the code of conduct of their profession, just like
Brodkaster sa Pilipinas, Ink. ("Radio Code"). Item I(B) of the Radio other professionals. A professional code of conduct provides the
Code provides: standards for determining whether a person has acted justly, honestly
and with good faith in the exercise of his rights and performance of
B. PUBLIC AFFAIRS, PUBLIC ISSUES AND his duties as required by Article 1937 of the Civil Code. A professional
COMMENTARIES code of conduct also provides the standards for determining whether
a person who willfully causes loss or injury to another has acted in a
1. x x x manner contrary to morals or good customs under Article 2138 of the
Civil Code.
4. Public affairs program shall present public issues free
from personal bias, prejudice and inaccurate and II.
Whether AMEC is entitled to moral damages III.

FBNI contends that AMEC is not entitled to moral damages because Whether the award of attorney’s fees is proper
it is a corporation.39
FBNI contends that since AMEC is not entitled to moral damages,
A juridical person is generally not entitled to moral damages because, there is no basis for the award of attorney’s fees. FBNI adds that the
unlike a natural person, it cannot experience physical suffering or such instant case does not fall under the enumeration in Article 220848 of
sentiments as wounded feelings, serious anxiety, mental anguish or the Civil Code.
moral shock.40 The Court of Appeals cites Mambulao Lumber Co. v.
PNB, et al.41 to justify the award of moral damages. However, the The award of attorney’s fees is not proper because AMEC failed to
Court’s statement in Mambulao that "a corporation may have a good justify satisfactorily its claim for attorney’s fees. AMEC did not
reputation which, if besmirched, may also be a ground for the award adduce evidence to warrant the award of attorney’s fees. Moreover,
of moral damages" is an obiter dictum.42 both the trial and appellate courts failed to explicitly state in their
respective decisions the rationale for the award of attorney’s
Nevertheless, AMEC’s claim for moral damages falls under item 7 of fees.49 In Inter-Asia Investment Industries, Inc. v. Court of
Article 221943 of the Civil Code. This provision expressly authorizes Appeals ,50 we held that:
the recovery of moral damages in cases of libel, slander or any other
form of defamation. Article 2219(7) does not qualify whether the [I]t is an accepted doctrine that the award thereof as an item of
plaintiff is a natural or juridical person. Therefore, a juridical person damages is the exception rather than the rule, and counsel’s fees are
such as a corporation can validly complain for libel or any other form not to be awarded every time a party wins a suit. The power of the
of defamation and claim for moral damages. 44 court to award attorney’s fees under Article 2208 of the Civil Code
demands factual, legal and equitable justification, without which
Moreover, where the broadcast is libelous per se, the law implies the award is a conclusion without a premise, its basis being
damages.45 In such a case, evidence of an honest mistake or the want improperly left to speculation and conjecture. In all events, the
of character or reputation of the party libeled goes only in mitigation court must explicitly state in the text of the decision, and not only in
of damages.46 Neither in such a case is the plaintiff required to the decretal portion thereof, the legal reason for the award of
introduce evidence of actual damages as a condition precedent to the attorney’s fees. 51 (Emphasis supplied)
recovery of some damages.47 In this case, the broadcasts are
libelous per se. Thus, AMEC is entitled to moral damages. While it mentioned about the award of attorney’s fees by stating that
it "lies within the discretion of the court and depends upon the
However, we find the award of ₱300,000 moral damages circumstances of each case," the Court of Appeals failed to point out
unreasonable. The record shows that even though the broadcasts were any circumstance to justify the award.
libelous per se, AMEC has not suffered any substantial or material
damage to its reputation. Therefore, we reduce the award of moral IV.
damages from ₱300,000 to ₱150,000.
Whether FBNI is solidarily liable with Rima and Alegre for moral defamatory statements published by radio or television may be had
damages, attorney’s fees and costs of suit from the owner of the station, a licensee, the operator of the station,
or a person who procures, or participates in, the making of the
FBNI contends that it is not solidarily liable with Rima and Alegre for defamatory statements."54 An employer and employee are solidarily
the payment of damages and attorney’s fees because it exercised due liable for a defamatory statement by the employee within the course
diligence in the selection and supervision of its employees, and scope of his or her employment, at least when the employer
particularly Rima and Alegre. FBNI maintains that its broadcasters, authorizes or ratifies the defamation.55 In this case, Rima and Alegre
including Rima and Alegre, undergo a "very regimented process" were clearly performing their official duties as hosts of FBNI’s radio
before they are allowed to go on air. "Those who apply for broadcaster program Exposé when they aired the broadcasts. FBNI neither alleged
are subjected to interviews, examinations and an apprenticeship nor proved that Rima and Alegre went beyond the scope of their work
program." at that time. There was likewise no showing that FBNI did not
authorize and ratify the defamatory broadcasts.
FBNI further argues that Alegre’s age and lack of training are
irrelevant to his competence as a broadcaster. FBNI points out that the Moreover, there is insufficient evidence on record that FBNI exercised
"minor deficiencies in the KBP accreditation of Rima and Alegre do due diligence in the selection and supervision of its employees,
not in any way prove that FBNI did not exercise the diligence of a particularly Rima and Alegre. FBNI merely showed that it exercised
good father of a family in selecting and supervising them." Rima’s diligence in the selection of its broadcasters without introducing any
accreditation lapsed due to his non-payment of the KBP annual fees evidence to prove that it observed the same diligence in
while Alegre’s accreditation card was delayed allegedly for reasons the supervision of Rima and Alegre. FBNI did not show how it
attributable to the KBP Manila Office. FBNI claims that membership exercised diligence in supervising its broadcasters. FBNI’s alleged
in the KBP is merely voluntary and not required by any law or constant reminder to its broadcasters to "observe truth, fairness and
government regulation. objectivity and to refrain from using libelous and indecent language"
is not enough to prove due diligence in the supervision of its
FBNI’s arguments do not persuade us. broadcasters. Adequate training of the broadcasters on the industry’s
code of conduct, sufficient information on libel laws, and continuous
The basis of the present action is a tort. Joint tort feasors are jointly evaluation of the broadcasters’ performance are but a few of the many
and severally liable for the tort which they commit. 52 Joint tort feasors ways of showing diligence in the supervision of broadcasters.
are all the persons who command, instigate, promote, encourage,
advise, countenance, cooperate in, aid or abet the commission of a tort, FBNI claims that it "has taken all the precaution in the selection of
or who approve of it after it is done, if done for their benefit. 53 Thus, Rima and Alegre as broadcasters, bearing in mind their
AMEC correctly anchored its cause of action against FBNI on Articles qualifications." However, no clear and convincing evidence shows
2176 and 2180 of the Civil Code. that Rima and Alegre underwent FBNI’s "regimented process" of
application. Furthermore, FBNI admits that Rima and Alegre had
As operator of DZRC-AM and employer of Rima and Alegre, FBNI deficiencies in their KBP accreditation,56 which is one of FBNI’s
is solidarily liable to pay for damages arising from the libelous requirements before it hires a broadcaster. Significantly, membership
broadcasts. As stated by the Court of Appeals, "recovery for in the KBP, while voluntary, indicates the broadcaster’s strong
commitment to observe the broadcast industry’s rules and regulations.
Clearly, these circumstances show FBNI’s lack of diligence in
selecting and supervising Rima and Alegre. Hence, FBNI is solidarily
liable to pay damages together with Rima and Alegre.

WHEREFORE, we DENY the instant petition. We AFFIRM the

Decision of 4 January 1999 and Resolution of 26 January 2000 of the
Court of Appeals in CA-G.R. CV No. 40151 with the
MODIFICATION that the award of moral damages is reduced from
₱300,000 to ₱150,000 and the award of attorney’s fees is deleted.
Costs against petitioner.

SO ORDERED.
EXPERTRAVEL & TOURS, INC., petitioner, demands were ignored by Lo, Expertravel filed a court complaint for
vs. recovery of the amount claimed plus damages.
THE HON. COURT OF APPEALS and RICARDO
LO, respondents. Respondent Lo explained, in his answer, that his account with
Expertravel had already been fully paid. The outstanding account was
remitted to Expertravel through its then Chairperson, Ms. Ma. Rocio
de Vega, who was theretofore authorized to deal with the clients of
VITUG, J.: Expertravel. The payment was evidenced by a Monte de Piedad Check
No. 291559, dated 06 October 1987, for P42,175.20 for which Ms. de
Petitioner, Expertravel and Tours, Inc., seeks in the instant petition for Vega, in turn, issued City Trust Check No. 417920 in favor of
review on certiorari a modification of the decision, dated 20 March Expertravel for the amount of P50,000.00, with the notation
1997, of the Court of Appeals affirming in toto the 07th November "placement advance for Ricardo Lo, etc." Per its own invoice,
1994 judgment of the Regional Trial Court (Branch 5) of Manila, the Expertravel received the sum on 10 October 1987.
dispositive portion of which reads:
The trial court, affirmed by the appellate court, held that the payment
WHEREFORE, in view of all the foregoing, made by Lo was valid and bidding on petitioner Expertravel. Even on
judgment is rendered declaring the instant suit the assumption that Ms. de Vera had not been specifically authorized
DISMISSED, and hereby orders the plaintiff to pay by Expertravel, both courts said, the fact that the amount "delivered to
defendant Ricardo Lo moral damages in the amount the latter remain(ed) in its possession up to the present, mean(t) that
of P30,000.00; attorney's fees in the amount of the amount redounded to the benefit of petitioner Expertravel, in view
P10,000.00, and to pay the costs of the suit. of the second paragraph of Article 1241 of the Civil Code to the effect
that payment made to a third person shall also be valid in so far as it
No pronouncement as to other damages for lack of has rebounded to the benefit of the creditor."
evidence to warrant the same. 1
In this recourse, petitioner confines itself to the following related legal
The factual and case settings of the controversy are culled from the issues; viz.:
pleadings on record and the assailed decision of the appellate court
and that of the court a quo. I. Can moral damages be recovered in a clearly
unfounded suit?
On 07 October 1987, Expertravel & Tours, Inc., ("Expertravel"), a
domestic corporation engaged in the travel agency business, issued to II. Can moral damages be awarded for negligence or
private respondent Ricardo Lo four round-trip plane tickets for quasi-delict that did not result to physical injury to the
Hongkong, together with hotel accommodations and transfers, for a offended party?2
total cost of P39,677.20. Alleging that Lo had failed to pay the amount
due, Expertravel caused several demands to be made. Since the There is merit in the petition.
Moral damages are not punitive in nature but are designed to Although the institution of a clearly unfounded civil suit can at times
compensate3 and alleviate in some way the physical suffering, mental be a legal justification for an award of attorney's fees, 10 such filing,
anguish, fright, serious anxiety, besmirched reputation, wounded however, has almost invariably been held not to be a ground for an
feelings, moral shock, social humiliation, and similar injury unjustly award of moral
11
caused to a person. Although incapable of pecuniary computation, damages. The rationale for the rule is that the law could not have
moral damages, nevertheless, must somehow be proportional to and in meant to impose a penalty on the right to litigate. The anguish suffered
approximation of the suffering inflicted. 4 Such damages, to be by a person for having been made a defendant in a civil suit would be
recoverable, must be the proximate result of a wrongful act or no different from the usual worry and anxiety suffered by anyone who
omission the factual basis for which is satisfactorily established by the is haled to court, a situation that cannot by itself be a cogent reason for
aggrieved party.5 An award of moral damages would require certain the award of moral damages. 12 If the rule were otherwise, then moral
conditions to be met; to wit: (1) First, there must be an injury, whether damages must every time be awarded in favor of the prevailing
physical, mental or psychological, clearly sustained by the claimant; defendant against an unsuccessful plaintiff.13
(2) second, there must be a culpable act or omission factually
established; (3) third, the wrongful act or omission of the defendant is The Court confirms, once again, the foregoing rules.
the proximate cause of the injury sustained by the claimant; and
(4) fourth, the award of damages is predicated on any of the cases WHEREFORE, the petition is GRANTED and the award of moral
stated in Article 2219.6 Under the provisions of this law, in culpa damages to respondent Ricardo Lo under the assailed decision is
contractual or breach of contract, moral damages may be recovered DELETED. In its other aspects, the appealed decision shall remain
when the defendant acted in bad faith or was guilty of gross negligence undisturbed. No costs.
(amounting to bad faith) or in wanton disregard of his contractual
obligation and, exceptionally, when the act of breach of contract itself SO ORDERED
is constitutive of tort resulting in physical injuries.7 By special rule in
Article 1764, in relation to Article 2206, of the Civil Code, moral
damages may also be awarded in case the death of a passenger results
from a breach of carriage. In culpa aquiliana, or quasi-delict, (a) when
an act or omission causes physical injuries, or (b) where the defendant
is guilty of intentional tort,8 moral damages may aptly be recovered.
This rule also applies, as aforestated, to contracts when breached by
tort. In culpa criminal, moral damages could be lawfully due when the
accused is found guilty of physical injuries, lascivious acts, adultery
or concubinage, illegal or arbitrary detention, illegal arrest, illegal
search, or defamation. Malicious prosecution can also give rise to a
claim for moral damages. The term "analogous cases," referred to in
Article 2219, following the ejusdem generis rule, must be held similar
to those expressly enumerated by the law. 9
G.R. No. 142029 February 28, 2001 "On the day of the wedding, December 14, 1992, plaintiffs
arrived at the Cebu Country Club around 6:00 o'clock in the
ERLINDA FRANCISCO, doing business in the name and style of evening. They immediately notice the absence of the wedding
Cebu Fountainhead Bakeshop and JULIANA cake.
PAMAONG, petitioners,
vs. "At 7:00 o'clock in the evening they made a follow-up call to
RICARDO FERRER, JR., ANNETTE FERRER, ERNESTO LO Fountainhead Bakeshop and was informed that it was
AND REBECCA LO, respondents. probably late because of the traffic.

PARDO, J.: "At 8:00 o'clock they were informed that no wedding cake
will be delivered because the order slip got lost. Plaintiffs
Appeal via certiorari1 taken by petitioners from the decision of the were then compelled to buy the only available cake at the
Court of Appeals 2 increasing the trial court's award of moral damages Cebu Country Club which was a sans rival. Even though they
to Ricardo Ferrer, Jr., Annette Ferrer, Ernesto Lo and Rebecca Lo to felt that it was a poor substitute to a wedding cake, the cutting
two hundred fifty thousand pesos (P250,000.00) and awarding of the cake is always a part of the ceremony.
exemplary damages in the amount of one hundred thousand pesos
(P100,000.00), in addition to the following: "At 10:00 o'clock in the evening, the wedding cake arrived but
plaintiffs declined to accept it, besides their order was a three-
"1. The cost of the wedding cake in the amount of P3,175.00; layered cake and what was actually delivered was a two-
layered one.
"2. Attorney's fees in the amount of P10,000.00; and
"Subsequently, defendant Erlinda Francisco sent a letter of
"3. Cost of litigation." apology accompanied with a P5,000.00 check, however, the
same was declined by plaintiffs because they felt it was
The facts, as found by the Court of Appeals, 3 are as follows: inadequate.

"On November 19, 1992 Mrs. Rebecca Lo and her daughter "Two weeks after the wedding, defendant Erlinda Francisco
Annette Ferrer ordered a three-layered cake from called Mrs. Rebecca Lo and apologized.
Fountainhead Bakeshop, Mango Avenue Branch. It was then
agreed that the wedding cake shall be delivered at 5:00 o'clock "Ricardo Ferrer, son-in-law of Rebecca Lo corroborated the
in the afternoon at the Cebu Country Club, Cebu City, stating latter's testimony, stating that two weeks after the wedding, as
clearly that the wedding is scheduled on December 14, 1992. a result of the non-delivery of the wedding cake, Ramon
Montinola, the son-in-law of Erlinda Francisco, went to
"Plaintiffs made their first deposit in the amount of P1,000.00 Rebecca Lo's residence and offered the sum of P5,000.00 to
on November 19, 1992 and two weeks thereafter made a full indemnify for the damage done, but it was rejected."4
payment on the remaining balance.
On March 12, 1993, respondents filed with the Regional Trial Court, thousand pesos (P250,000.00); and (2) whether the Court of Appeals
Cebu City an action for breach of contract with damages against was justified in awarding in addition to moral damages, exemplary
petitioners.5 damages of one hundred thousand pesos (P100,000.00).1âwphi1.nêt

After due trial, on May 19, 1995, the trial court rendered a decision in Petitioners submit that the Court of Appeals and the trial court erred
favor of plaintiffs [herein defendants], the dispositive portion of which in awarding moral damages in favor of respondents because moral
reads as follows: damages are recoverable in breach of contract cases only where the
breach was palpably wanton, reckless, malicious, in bad faith,
"THE FOREGOING CONSIDERED, judgment is hereby oppressive or abusive.10
rendered in favor of the plaintiffs and against Erlinda
Francisco. We agree. "To recover moral damages in an action for breach of
contract, the breach must be palpably wanton, reckless, malicious, in
"Directing the latter to pay the former the following: bad faith, oppressive or abusive."11

"1. The cost of the wedding cake in the amount of P3,175.00; "Under the provisions of this law,12 in culpa contractual or breach of
contract, moral damages may be recovered when the defendant acted
"2. Moral damages in the amount of P30,000.00; in bad faith or was guilty of gross negligence (amounting to bad faith)
or in wanton disregard of his contractual obligation and, exceptionally,
"3. Attorney's fees in the amount of P10,000.00; and when the act of breach of contract itself is constitutive of tort resulting
in physical injuries."13
"4. Cost of litigation.
"Moral damages may be awarded in breaches of contracts where the
"SO ORDERED." 6 defendant acted fraudulently or in bad faith."14

"Bad faith does not simply connote bad judgment or negligence, it

On May 25, 1995, petitioners appealed to the Court of Appeals. 7
imports a dishonest purpose or some moral obliquity and conscious
doing of a wrong, a breach of known duty through some motive or
After due proceedings, on July 05, 1999, the Court of Appeals
interest or ill will that partakes of the nature of fraud."15
promulgated its decision modifying the appealed decision as set out in
the opening paragraph of this opinion.8
In this case, "[w]e find no such fraud or bad faith."16
Hence, this appeal.9
"Moral damages are in the category of an award designed to
compensate the claimant for actual injury suffered and not to impose
The issues raised are (1) whether the Court of Appeals erred in
a penalty on the wrongdoer."17
affirming the trial court's award of moral damages and increasing the
amount from thirty thousand (30,000.00) to two hundred fifty
"The person claiming moral damages must prove the existence of bad determination depending upon the amount of compensatory damages
faith by clear and convincing evidence for the law always presumes that may be awarded to the claimant; (3) the act must be accompanied
good faith. It is not enough that one merely suffered sleepless nights, by bad faith or done in a wanton, fraudulent, oppressive or malevolent
mental anguish, serious anxiety as the result of the actuations of the manner."26
other party. Invariably such action must be shown to have been
willfully done in bad faith or will ill motive."18 "Mere allegations of Nevertheless, the facts show that when confronted with their failure to
besmirched reputation, embarrassment and sleepless nights are deliver on the wedding day the wedding cake ordered and paid for,
insufficient to warrant an award for moral damages. It must be shown petitioners gave the lame excuse that delivery was probably delayed
that the proximate cause thereof was the unlawful act or omission of because of the traffic, when in truth, no cake could be delivered
the [private respondent] petitioners."19 because the order slip got lost. For such prevarication, petitioners must
be held liable for nominal damages for insensitivity, inadvertence or
"An award of moral damages would require certain conditions to be inattention to their customer's anxiety and need of the hour. "Nominal
met, to wit: (1) first, there must be an injury, whether physical, mental damages are 'recoverable where a legal right is technically violated
or psychological, clearly sustained by the claimant; (2) second, there and must be vindicated against an invasion that has produced no actual
must be culpable act or omission factually established; (3) third, the present loss of any kind or where there has been a breach of contract
wrongful act or omission of the defendant is the proximate cause of and no substantial injury or actual damages whatsoever have been or
the injury sustained by the claimant; and (4) fourth, the award of can be shown.'"27 Nominal damages may be awarded "to a plaintiff
damages is predicated on any of the cases stated in Article 2219" of whose right has been violated or invaded by the defendant, for the
the Civil Code.21 purpose of vindicating or recognizing that right, not for indemnifying
the plaintiff for any loss suffered."28
"It must again be stressed that moral damages are emphatically not
intended to enrich a plaintiff at the expense of the defendant."22 "When WHEREFORE, the Court GRANTS the petition. The
awarded, moral damages must not be palpably and scandalously Court REVERSES the decision of the Court of Appeals in CA-G. R.
excessive as to indicate that it was the result of passion, prejudice or CV No. 50894, and in lieu thereof, sentences petitioners to pay
corruption on the part of the trial court judge"23 or appellate court respondents, as follows:
justices.24
1. The cost of the wedding cake in the amount of P3,175.00;
In the same fashion, to warrant the award of exemplary damages,
"[t]he wrongful act must be accompanied by bad faith, and an award 2. Nominal damages in the amount of P10,000.00;
of damages would be allowed only if the guilty party acted in a
wanton, fraudulent, reckless or malevolent manner."25 3. Attorney's fees in the amount of P10,000.00; and

"The requirements of an award of exemplary damages are: (1) they 4. Costs of litigation.
may be imposed by way of example in addition to compensatory
damages, and only after the claimant's right to them has been No costs in this instance.
established; (2) that they can not be recovered as a matter of right, their
SO ORDERED.
G.R. No. 122039 May 31, 2000 wedging were done under sedation. Her confinement in the hospital
lasted from August 23 to September 7, 1989. Her attending physician,
VICENTE CALALAS, petitioner, Dr. Danilo V. Oligario, an orthopedic surgeon, certified she would
vs. remain on a cast for a period of three months and would have to
COURT OF APPEALS, ELIZA JUJEURCHE SUNGA and ambulate in crutches during said period.
FRANCISCO SALVA, respondents.
On October 9, 1989, Sunga filed a complaint for damages against
Calalas, alleging violation of the contract of carriage by the former in
failing to exercise the diligence required of him as a common carrier.
Calalas, on the other hand, filed a third-party complaint against
MENDOZA, J.: Francisco Salva, the owner of the Isuzu truck.

This is a petition for review on certiorari of the decision1 of the Court The lower court rendered judgment against Salva as third-party
of Appeals, dated March 31, 1991, reversing the contrary decision of defendant and absolved Calalas of liability, holding that it was the
the Regional Trial Court, Branch 36, Dumaguete City, and awarding driver of the Isuzu truck who was responsible for the accident. It took
damages instead to private respondent Eliza Jujeurche Sunga as cognizance of another case (Civil Case No. 3490), filed by Calalas
plaintiff in an action for breach of contract of carriage. against Salva and Verena, for quasi-delict, in which Branch 37 of the
same court held Salva and his driver Verena jointly liable to Calalas
The facts, as found by the Court of Appeals, are as follows: for the damage to his jeepney.

At 10 o'clock in the morning of August 23, 1989, private respondent On appeal to the Court of Appeals, the ruling of the lower court was
Eliza Jujeurche G. Sunga, then a college freshman majoring in reversed on the ground that Sunga's cause of action was based on a
Physical Education at the Siliman University, took a passenger contract of carriage, not quasi-delict, and that the common carrier
jeepney owned and operated by petitioner Vicente Calalas. As the failed to exercise the diligence required under the Civil Code. The
jeepney was filled to capacity of about 24 passengers, Sunga was appellate court dismissed the third-party complaint against Salva and
given by the conductor an "extension seat," a wooden stool at the back adjudged Calalas liable for damages to Sunga. The dispositive portion
of the door at the rear end of the vehicle. of its decision reads:

On the way to Poblacion Sibulan, Negros Occidental, the jeepney WHEREFORE, the decision appealed from is hereby
stopped to let a passenger off. As she was seated at the rear of the REVERSED and SET ASIDE, and another one is
vehicle, Sunga gave way to the outgoing passenger. Just as she was entered ordering defendant-appellee Vicente Calalas
doing so, an Isuzu truck driven by Iglecerio Verena and owned by to pay plaintiff-appellant:
Francisco Salva bumped the left rear portion of the jeepney. As a
result, Sunga was injured. She sustained a fracture of the "distal third (1) P50,000.00 as actual and compensatory damages;
of the left tibia-fibula with severe necrosis of the underlying skin."
Closed reduction of the fracture, long leg circular casting, and case (2) P50,000.00 as moral damages;
 (3) P10,000.00 as attorney's fees; and of the contract and the fact that the obligor, in this case the common
carrier, failed to transport his passenger safely to his destination. 2 In
(4) P1,000.00 as expenses of litigation; and case of death or injuries to passengers, Art. 1756 of the Civil Code
provides that common carriers are presumed to have been at fault or
(5) to pay the costs. to have acted negligently unless they prove that they observed
extraordinary diligence as defined in Arts. 1733 and 1755 of the Code.
SO ORDERED. This provision necessarily shifts to the common carrier the burden of
proof.
Hence, this petition. Petitioner contends that the ruling in Civil Case
No. 3490 that the negligence of Verena was the proximate cause of There is, thus, no basis for the contention that the ruling in Civil Case
the accident negates his liability and that to rule otherwise would be No. 3490, finding Salva and his driver Verena liable for the damage
to make the common carrier an insurer of the safety of its passengers. to petitioner's jeepney, should be binding on Sunga. It is immaterial
He contends that the bumping of the jeepney by the truck owned by that the proximate cause of the collision between the jeepney and the
Salva was a caso fortuito. Petitioner further assails the award of moral truck was the negligence of the truck driver. The doctrine of proximate
damages to Sunga on the ground that it is not supported by evidence. cause is applicable only in actions for quasi-delict, not in actions
involving breach of contract. The doctrine is a device for imputing
liability to a person where there is no relation between him and another
The petition has no merit.
party. In such a case, the obligation is created by law itself. But, where
there is a pre-existing contractual relation between the parties, it is the
The argument that Sunga is bound by the ruling in Civil Case No. 3490
parties themselves who create the obligation, and the function of the
finding the driver and the owner of the truck liable for quasi-delict
law is merely to regulate the relation thus created. Insofar as contracts
ignores the fact that she was never a party to that case and, therefore,
of carriage are concerned, some aspects regulated by the Civil Code
the principle of res judicata does not apply.
are those respecting the diligence required of common carriers with
regard to the safety of passengers as well as the presumption of
Nor are the issues in Civil Case No. 3490 and in the present case the negligence in cases of death or injury to passengers. It provides:
same. The issue in Civil Case No. 3490 was whether Salva and his
driver Verena were liable for quasi-delict for the damage caused to
Art. 1733. Common carriers, from the nature of their
petitioner's jeepney. On the other hand, the issue in this case is whether
business and for reasons of public policy, are bound
petitioner is liable on his contract of carriage. The first, quasi-delict,
to observe extraordinary diligence in the vigilance
also known as culpa aquiliana or culpa extra contractual, has as its
over the goods and for the safety of the passengers
source the negligence of the tortfeasor. The second, breach of contract
transported by them, according to all the
or culpa contractual, is premised upon the negligence in the
circumstances of each case.
performance of a contractual obligation.
Such extraordinary diligence in the vigilance over the
Consequently, in quasi-delict, the negligence or fault should be clearly
goods is further expressed in articles 1734, 1735, and
established because it is the basis of the action, whereas in breach of
1746, Nos. 5, 6, and 7, while the extraordinary
contract, the action can be prosecuted merely by proving the existence
 diligence for the safety of the passengers is further set unloading freight, obstruct the free passage of other
forth in articles 1755 and 1756. vehicles on the highway.

Art. 1755. A common carrier is bound to carry the Second, it is undisputed that petitioner's driver took in more
passengers safely as far as human care and foresight passengers than the allowed seating capacity of the jeepney, a
can provide, using the utmost diligence of very violation of §32(a) of the same law. It provides:
cautious persons, with due regard for all the
circumstances. Exceeding registered capacity. — No person
operating any motor vehicle shall allow more
Art. 1756. In case of death of or injuries to passengers or more freight or cargo in his vehicle than
passengers, common carriers are presumed to have its registered capacity.
been at fault or to have acted negligently, unless they
prove that they observed extraordinary diligence as The fact that Sunga was seated in an "extension seat" placed her in a
prescribed by articles 1733 and 1755. peril greater than that to which the other passengers were exposed.
Therefore, not only was petitioner unable to overcome the
In the case at bar, upon the happening of the accident, the presumption presumption of negligence imposed on him for the injury sustained by
of negligence at once arose, and it became the duty of petitioner to Sunga, but also, the evidence shows he was actually negligent in
prove that he had to observe extraordinary diligence in the care of his transporting passengers.
passengers.
We find it hard to give serious thought to petitioner's contention that
Now, did the driver of jeepney carry Sunga "safely as far as human Sunga's taking an "extension seat" amounted to an implied assumption
care and foresight could provide, using the utmost diligence of very of risk. It is akin to arguing that the injuries to the many victims of the
cautious persons, with due regard for all the circumstances" as tragedies in our seas should not be compensated merely because those
required by Art. 1755? We do not think so. Several factors militate passengers assumed a greater risk of drowning by boarding an
against petitioner's contention. overloaded ferry. This is also true of petitioner's contention that the
jeepney being bumped while it was improperly parked
First, as found by the Court of Appeals, the jeepney was not properly constitutes caso fortuito. A caso fortuito is an event which could not
parked, its rear portion being exposed about two meters from the broad be foreseen, or which, though foreseen, was inevitable. 3 This requires
shoulders of the highway, and facing the middle of the highway in a that the following requirements be present: (a) the cause of the breach
diagonal angle. This is a violation of the R.A. No. 4136, as amended, is independent of the debtor's will; (b) the event is unforeseeable or
or the Land Transportation and Traffic Code, which provides: unavoidable; (c) the event is such as to render it impossible for the
debtor to fulfill his obligation in a normal manner, and (d) the debtor
Sec. 54. Obstruction of Traffic. — No person shall did not take part in causing the injury to the
drive his motor vehicle in such a manner as to obstruct creditor.4 Petitioner should have foreseen the danger of parking his
or impede the passage of any vehicle, nor, while jeepney with its body protruding two meters into the highway.
discharging or taking on passengers or loading or
Finally, petitioner challenges the award of moral damages alleging the death of a passenger, as provided in Art. 1764, in relation to Art.
that it is excessive and without basis in law. We find this contention 2206(3) of the Civil Code; and (2) in the cases in which the carrier is
well taken. guilty of fraud or bad faith, as provided in Art. 2220. 6

In awarding moral damages, the Court of Appeals stated: In this case, there is no legal basis for awarding moral damages since
there was no factual finding by the appellate court that petitioner acted
Plaintiff-appellant at the time of the accident was a in bad faith in the performance of the contract of carriage. Sunga's
first-year college student in that school year 1989- contention that petitioner's admission in open court that the driver of
1990 at the Silliman University, majoring in Physical the jeepney failed to assist her in going to a nearby hospital cannot be
Education. Because of the injury, she was not able to construed as an admission of bad faith. The fact that it was the driver
enroll in the second semester of that school year. She of the Isuzu truck who took her to the hospital does not imply that
testified that she had no more intention of continuing petitioner was utterly indifferent to the plight of his injured passenger.
with her schooling, because she could not walk and If at all, it is merely implied recognition by Verena that he was the one
decided not to pursue her degree, major in Physical at fault for the accident.
Education "because of my leg which has a defect
already." WHEREFORE, the decision of the Court of Appeals, dated March 31,
1995, and its resolution, dated September 11, 1995, are AFFIRMED,
Plaintiff-appellant likewise testified that even while with the MODIFICATION that the award of moral damages is
she was under confinement, she cried in pain because DELETED.
of her injured left foot. As a result of her injury, the
Orthopedic Surgeon also certified that she has SO ORDERED.
"residual bowing of the fracture side." She likewise
decided not to further pursue Physical Education as
her major subject, because "my left leg . . . has a
defect already."

Those are her physical pains and moral sufferings, the

inevitable bedfellows of the injuries that she suffered.
Under Article 2219 of the Civil Code, she is entitled
to recover moral damages in the sum of P50,000.00,
which is fair, just and reasonable.

As a general rule, moral damages are not recoverable in actions for

damages predicated on a breach of contract for it is not one of the items
enumerated under Art. 2219 of the Civil Code.5 As an exception, such
damages are recoverable: (1) in cases in which the mishap results in
G.R. No. 202124 and Claudine Divina, a minor, 3 ½ years of age, who suffered the
following:
PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee,
vs. "Gunshot wound -
IRENEO JUGUETA, Accused-Appellant.
Point of Entry - 9th ICS along the mid-axillary line, right, 1 cm.
DECISION diameter

PERALTA, J.: Point of Exit - 7th ICS mid-axillary line, left;"

This resolves the appeal from the Decision 1 of the Court of Appeals which directly caused their instant death.
(CA) dated January 30, 2012 in CA-G.R. CR HC No. 03252. The CA
affirmed the judgments of the Regional Trial Court (RTC), Branch 61, That the crime committed in the dwelling of the offended party who
Gumaca, Quezon, finding accused-appellant Ireneo Jugueta y Flores had not given provocation for the attack and the accused took
guilty beyond reasonable doubt of Double Murder in Criminal Case advantage of nighttime to facilitate the commission of the offense.
No. 7698-G and Multiple Attempted Murder in Criminal Case No.
7702-G. Contrary to law.2

In Criminal Case No. 7698-G, appellant was charged with Double In Criminal Case No. 7702-G, appellant, together with Gilbert Estores
Murder, defined and penalized under Article 248 of the Revised Penal and Roger San Miguel, was charged with Multiple Attempted Murder,
Code, allegedly committed as follows: allegedly committed as follows:

That on or about the 6th day of June 2002, at about 9:00 o'clock in the That on or about 9:00 o’clock in the evening of 6th day of June, 2002,
evening, at Barangay Caridad Ilaya, Municipality of Atimonan, at Barangay Caridad Ilaya, Municipality of Atimonan, Province of
Province of Quezon, Philippines, and within the jurisdiction of this Quezon, Philippines and within the jurisdiction of this Honorable
Honorable Court, the above-named accused, armed with a caliber.22 Court, the above-named accused, conspiring and confederating
firearm, with intent to kill, qualified by treachery and evident together and mutually helping one another, armed with short firearms
premeditation, did then and there willfully, unlawfully and feloniously of undetermined calibres, with intent to kill, qualified by treachery,
attack, assault and shoot with said firearm Mary Grace Divina, a with evident premeditation and abuse of superior strength, did then
minor, 13 years old, who suffered the following: and there wilfully, unlawfully and feloniously attack, assault, and
shoot with the said firearms the house occupied by the family of
"Gunshot wound - Norberto Divina, thereby commencing the commission of the crime
of Murder, directly by overt acts, but did not perform all the acts of
Point of Entry – lower abdomen, right, 2 cm. from the midline and 6 execution which would have produced it by reason of some cause or
cm. from the level of the umbilicus, directed upward toward the left accident other than the spontaneous desistance of the accused, that is,
upper abdomen." the occupants Norberto Divina, his wife Maricel Divina and children
Elizabeth Divina and Judy Ann Divina, both elementary pupils and The 3 men ordered Norberto to come down from his house, but he
who are minors, were not hit. refused to do so. The men then uttered, "Magdasal ka na at katapusan
mo na ngayon." Norberto pleaded with them, saying, "Maawa kayo sa
CONTRARY TO LAW.3 amin, matanda na ako at marami akong anak. Anong kasalanan ko sa
inyo?" Despite such plea for mercy, a gunshot was fired, and Norberto
Roger San Miguel, however, moved for reinvestigation of the case immediately threw his body over his children and wife in an attempt
against them. At said proceedings, one Danilo Fajarillo submitted his to protect them from being hit. Thereafter, he heard successive
sworn statement stating that on June 6, 2002, he saw appellant with a gunshots being fired in the direction where his family huddled together
certain "Hapon" and Gilbert Estores at the crime scene, but it was only in their hut.7
appellant who was carrying a firearm while the other two had no
participation in the shooting incident. Fajarillo further stated that When the volley of shots ceased and the three (3) men left, Norberto
Roger San Miguel was not present at the crime scene. Based on the saw that his two (2) young daughters were wounded. His wife went
sworn statement of Fajarillo, the Provincial Prosecutor found no prima out of their house to ask for help from neighbors, while he and his
facie case against Gilbert Estores and Roger San Miguel.4 Thus, upon older daughter carried the two (2) wounded children out to the street.
motion of the prosecution, the case for Attempted Murder against His daughter Mary Grace died on the way to the hospital, while
Gilbert Estores and Roger San Miguel was dismissed, and trial Claudine expired at the hospital despite the doctors' attempts to revive
proceeded only as to appellant.5 her.8

At the trial, the prosecution presented the testimonies of Norberto In answer to questions of what could have prompted such an attack
Divina, the victim, and Dr. Lourdes Taguinod who executed the from appellant, Norberto replied that he had a previous altercation
Medico-Legal Certificate and confirmed that the children of Norberto, with appellant who was angered by the fact that he (Norberto) filed a
namely, Mary Grace and Claudine, died from gunshot wounds. Dr. case against appellant's two other brothers for molesting his daughter. 9
Taguinod noted that the trajectory of the bullet wounds showed that
the victims were at a higher location than the shooter, but she could On the other hand, appellant was only able to proffer denial and alibi
not tell what kind of ammunitions were used. 6 as his defense. Appellant's testimony, along with those of Gilbert
Estores, Roger San Miguel, Isidro San Miguel and Ruben Alegre, was
Norberto testified that the appellant is his brother-in-law. He that he (appellant) was just watching TV at the house of Isidro San
recounted that in the evening of June 6, 2002, as his entire family lay Miguel, where he had been living for several years, at the time the
down on the floor of their one-room nipa hut to sleep, the "sack" shooting incident occurred. However, he and the other witnesses
walling of their hut was suddenly stripped off, and only the supporting admitted that said house was a mere five-minute walk away from the
bamboo (fences) remained. With the covering of the wall gone, the crime scene. 10
three (3) men responsible for the deed came into view. Norberto
clearly saw their faces which were illuminated by the light of a gas Finding appellant’s defense to be weak, and ascribing more credence
lamp hanging in their small hut. Norberto identified the 3 men as to the testimony of Norberto, the trial court ruled that the evidence
appellant, Gilbert Estores and Roger San Miguel. clearly established that appellant, together with two other assailants,
conspired to shoot and kill the family of Norberto. Appellant was then
convicted of Double Murder in Criminal Case No. 7698-G and Aggrieved by the trial court's judgments, appellant appealed to the
Multiple Attempted Murder in Criminal Case No. 7702-G. CA. On January 30, 2012, the CA rendered a Decision affirming
appellant's conviction for the crimes charged. 13
The dispositive portion of the trial court’s judgment in Criminal Case
No. 7698-G reads: Dissatisfied with the CA Decision, appellant elevated the case to this
Court. On July 30, 2012, the Court issued a Resolution14 notifying the
WHEREFORE and in view of all the foregoing, the Court finds parties that they may submit their respective Supplemental Briefs.
accused Ireneo Jugueta guilty beyond reasonable doubt for Double Both parties manifested that they will no longer submit supplemental
Murder defined and punished under Article 248 of the Revised Penal briefs since they had exhaustively discussed their positions before the
Code and is hereby sentenced to suffer Reclusion Perpetua for the CA.15
death of Mary Grace Divina and to indemnify her heirs in the amount
of Php50,000.00 and another to suffer Reclusion Perpetua for the The main issue advanced in the Appellant's Brief deals with the
death of Claudine Divina and accused is further ordered to indemnify inconsistencies in Norberto's testimony, such as his failure to state
the heirs of Claudine Divina in the sum of Php50,000.00. In addition, from the beginning that all three assailants had guns, and to
he is hereby ordered to pay the heirs of the victims actual damages in categorically identify appellant as the one holding the gun used to kill
the amount of Php16,150.00 and to pay for the costs. Norberto’s children.

SO ORDERED.11 The appeal is unmeritorious.

On the other hand, the dispositive portion of the trial court’s judgment At the outset, it must be stressed that factual findings of the trial court,
in Criminal Case No. 7702-G, reads: its assessment of the credibility of witnesses and the probative weight
of their testimonies, and the conclusions based on these factual
WHEREFORE and in view of all the foregoing, the Court finds findings are to be given the highest respect. Thus, generally, the Court
accused Ireneo Jugueta guilty beyond reasonable doubt for Multiple will not recalibrate and re-examine evidence that had been analyzed
Attempted Murder defined and penalized under Article 248 in relation and ruled upon by the trial court and affirmed by the CA. 16
to Article 51 of the Revised Penal Code and is hereby sentenced to
suffer the penalty of FOUR (4) YEARS and TWO (2) MONTHS The evidence on record fully supports the trial court's factual finding,
of Prision Correccional as minimum to EIGHT (8) YEARS and ONE as affirmed by the CA, that appellant acted in concert with two other
(1) DAY of Prision Mayor as maximum for each of the offended individuals, all three of them carrying firearms and simultaneously
parties; Norberto Divina, Maricel Divina, Elizabeth Divina and Judy firing at Norberto and his family, killing his two young daughters.
Ann Divina. Further, accused is ordered to pay for the costs of the suit. Norberto clearly saw all of the three assailants with their firearms as
there is illumination coming from a lamp inside their house that had
SO ORDERED.12 been laid bare after its walling was stripped off, to wit:

Q: When the wall of your house was stripped off by these three
persons at the same time, do you have light in your house?
A: Yes, sir. A: All of them.

Q: What kind of light was there? Q: You mean to tell the honorable court that these three persons were

A: A gas lamp. having one firearm each?

Q: Where was the gas lamp placed at that time? A: Yes, sir.

A: In the middle of our house. Q: And they fired shots at the same time?

xxxx A: Yes, sir.

Q: when did they fire a shot? Q: To what direction these three persons fired (sic) their firearms
during that night?
A: On the same night, when they had stripped off the wallings.
A: To the place where we were.
Q: How many gunshots did you hear?
Q: When those three persons were firing their respective firearms,
A: Only one. what was your position then?

Q: Do you know the sound of a gunshot? A firearm? A: I ordered my children to lie down.

A: Yes, sir, it is loud? (sic) Q: How about you, what was your position when you were ordering
your children to lie down?
xxxx
A: (witness demonstrated his position as if covering his children with
Q: After the first shot, was there any second shot? his body and ordering them to line (sic) down face down)

A: After that, successive fire shot (sic) followed and my youngest and Q: Mr. Witness, for how long did these three persons fire shots at your
eldest daughters were hit. house?

xxxx A: Less than five minutes, sir.

Q: How many of the three were holding guns at that time? Q: After they fired their shots, they left your house?
A: Yes, sir. their house and when he refused despite his plea for mercy, they fired
at them having hit and killed his two (2) daughters. The family of
Q: And when these persons left your house, you inspected your Norberto Divina were unarmed and his children were at very tender
children to see what happened to them? ages. Mary Grace Divina and Claudine who were shot and killed were
13 years old and 3 ½ years old respectively. In this case, the victims
A: Yes, sir, they were hit. were defenseless and manifestly overpowered by armed assailants
when they were gunned down. There was clear showing that the attack
x x x17 was made suddenly and unexpectedly as to render the victims helpless
and unable to defend themselves. Norberto and his wife and his
Appellant and the two other malefactors are equally responsible for children could have already been asleep at that time of the night. x x
the death of Norberto's daughters because, as ruled by the trial court, x 21
they clearly conspired to kill Norberto's family. Conspiracy exists
when two or more persons come to an agreement regarding the Verily, the presence of treachery qualified the killing of the hapless
commission of a crime and decide to commit it. Proof of a prior children to murder. As held in People v. Fallorina,22 the essence of
meeting between the perpetrators to discuss the commission of the treachery is the sudden and unexpected attack on an unsuspecting
crime is not necessary as long as their concerted acts reveal a common victim without the slightest provocation on his part. Minor children,
design and unity of purpose. In such case, the act of one is the act of who by reason of their tender years, cannot be expected to put up a
all.18 Here, the three men undoubtedly acted in concert as they went defense. When an adult person illegally attacks a child, treachery
to the house of Norberto together, each with his own firearm. It is, exists.
therefore, no longer necessary to identify and prove that it is the bullet
particularly fired from appellant's firearm that killed the children. As to the charge of multiple attempted murder, the last paragraph of
Article 6 of the Revised Penal Code states that a felony is attempted
Murder is defined under Article 248 of the Revised Penal Code as the when the offender commences the commission of a felony directly by
unlawful killing of a person, which is not parricide or infanticide, overt acts, and does not perform all the acts of execution which should
attended by circumstances such as treachery or evident produce the felony by reason of some cause or accident other than his
premeditation.19 The presence of any one of the circumstances own spontaneous desistance. In Esqueda v. People,23 the Court held:
enumerated in Article 248 of the Code is sufficient to qualify a killing
as murder.20 The trial court correctly ruled that appellant is liable for If one inflicts physical injuries on another but the latter survives, the
murder because treachery attended the killing of Norberto’s two crime committed is either consummated physical injuries, if the
children, thus: offender had no intention to kill the victim, or frustrated or attempted
homicide or frustrated murder or attempted murder if the offender
x x x Evidence adduced show that the family of Norberto Divina, were intends to kill the victim. Intent to kill may be proved by evidence of:
all lying down side by side about to sleep on June 6, 2002 at around (a) motive; (b) the nature or number of weapons used in the
9:00 o’clock in the evening, when suddenly their wall made of sack commission of the crime; (c) the nature and number of wounds
was stripped off by [appellant] Ireneo Jugueta, Roger San Miguel and inflicted on the victim; (d) the manner the crime was committed; and
Gilberto Alegre (sic) [Gilbert Estores]. They ordered him to go out of
(e) the words uttered by the offender at the time the injuries are Time and again, this Court has deferred to the trial court's
inflicted by him on the victim. factual findings and evaluation of the credibility of witnesses,
especially when affirmed by the CA, in the absence of any
In this case, the prosecution has clearly established the intent to kill on clear showing that the trial court overlooked or misconstrued
the part of appellant as shown by the use of firearms, the words cogent facts and circumstances that would justify altering or
uttered24during, as well as the manner of, the commission of the crime. revising such findings and evaluation. This is because the trial
The Court thus quotes with approval the trial court’s finding that court's determination proceeds from its first-hand opportunity
appellant is liable for attempted murder, viz.: to observe the demeanor of the witnesses, their conduct and
attitude under grilling examination, thereby placing the trial
In the case at bar, the perpetrators who acted in concert commenced court in unique position to assess the witnesses' credibility and
the felony of murder first by suddenly stripping off the wall of their to appreciate their truthfulness, honesty and candor x x x. 29
house, followed by successive firing at the intended victims when
Norberto Divina refused to go out of the house as ordered by them. If The records of this case, particularly the testimonies of the witnesses,
only there were good in aiming their target, not only Mary Grace and reveal no outstanding or exceptional circumstance to justify a
Claudine had been killed but surely all the rest of the family would deviation from such long-standing principle. There is no cogent reason
surely have died. Hence, perpetrators were liable for Murder of Mary to overturn the trial court's ruling that the prosecution evidence,
Grace Divina and Claudine Divina but for Multiple Attempted Murder particularly the testimony of Norberto Divina identifying appellant as
for Norberto Divina, Maricel Divina, Elizabeth Divina and Judy Ann one of the assailants, is worthy of belief. Thus, the prosecution
Divina. But as [appellant] Ireneo Jugueta was the only one charged in evidence established beyond any reasonable doubt that appellant is
this case, he alone is liable for the crime committed. 25 one of the perpetrators of the crime.

Meanwhile, the supposed inconsistencies in Norberto's testimony, i.e., However, the Court must make a clarification as to the nomenclature
that he failed to state from the very beginning that all three assailants used by the trial court to identify the crimes for which appellant was
were carrying firearms, and that it was the shots from appellant’s penalized. There is some confusion caused by the trial court's use of
firearm that killed the children, are too trivial and inconsequential to the terms "Double Murder" and "Multiple Attempted Murder" in
put a dent on said witness's credibility. An examination of Norberto's convicting appellant, and yet imposing penalties which nevertheless
testimony would show that there are no real inconsistencies to speak show that the trial court meant to penalize appellant for two (2)
of. As ruled in People v. Cabtalan,26 "[m]inor inconsistencies and separate counts of Murder and four (4) counts of Attempted Murder.
discrepancies pertaining to trivial matters do not affect the credibility
of witnesses, as well as their positive identification of the accused as The facts, as alleged in the Information in Criminal Case No. 7698-G,
the perpetrators of the crime."27 Both the trial court and the CA found and as proven during trial, show that appellant is guilty of 2 counts of
Norberto's candid and straightforward testimony to be worthy of belief the crime of Murder and not Double Murder, as the killing of the
and this Court sees no reason why it should not conform to the victims was not the result of a single act but of several acts of appellant
principle reiterated in Medina, Jr. v. People28 that: and his cohorts. In the same vein, appellant is also guilty of 4 counts
of the crime of Attempted Murder and not Multiple Attempted Murder
in Criminal Case No. 7702-G. It bears stressing that the Informations
in this case failed to comply with the requirement in Section 13, Rule Appellant can therefore be held liable for all the crimes alleged in the
110 of the Revised Rules of Court that an information must charge Informations in Criminal Case Nos. 7698-G and 7702-G, i.e., 2 counts
only one offense. of murder and 4 counts of attempted murder, respectively, and proven
during trial.
As a general rule, a complaint or information must charge only one
offense, otherwise, the same is defective. The reason for the rule is Meanwhile, in People v. Nelmida,32 the Court explained the concept
stated in People of the Philippines and AAA v. Court of Appeals, 21st of a complex crime as defined in Article 4833 of the Revised Penal
Division, Mindanao Station, et al.,30 thus: Code, thus:

The rationale behind this rule prohibiting duplicitous complaints or In a complex crime, two or more crimes are actually committed,
informations is to give the accused the necessary knowledge of the however, in the eyes of the law and in the conscience of the offender
charge against him and enable him to sufficiently prepare for his they constitute only one crime, thus, only one penalty is imposed.
defense. The State should not heap upon the accused two or more There are two kinds of complex crime. The first is known as a
charges which might confuse him in his defense. Non-compliance compound crime, or when a single act constitutes two or more grave
with this rule is a ground for quashing the duplicitous complaint or or less grave felonies while the other is known as a complex crime
information under Rule 117 of the Rules on Criminal Procedure and proper, or when an offense is a necessary means for committing the
the accused may raise the same in a motion to quash before he enters other. The classic example of the first kind is when a single bullet
his plea, otherwise, the defect is deemed waived. results in the death of two or more persons. A different rule governs
where separate and distinct acts result in a number killed. Deeply
However, since appellant entered a plea of not guilty during rooted is the doctrine that when various victims expire from separate
arraignment and failed to move for the quashal of the Informations, he shot, such acts constitute separate and distinct crimes. 34
is deemed to have waived his right to question the same. Section 9 of
Rule 117 provides that "[t]he failure of the accused to assert any Here, the facts surrounding the shooting incident clearly show that
ground of a motion to quash before he pleads to the complaint or appellant and the two others, in firing successive and indiscriminate
information, either because he did not file a motion to quash or failed shots at the family of Norberto from their respective firearms, intended
to allege the same in said motion, shall be deemed a waiver of any to kill not only Norberto, but his entire family. When several gunmen,
objections except those based on the grounds provided for in as in this case, indiscriminately fire a series of shots at a group of
paragraphs (a), (b), (g), and (i) of Section 3 of this Rule." people, it shows their intention to kill several individuals. Hence, they
are committing not only one crime. What appellant and his cohorts
It is also well-settled that when two or more offenses are charged in a committed cannot be classified as a complex crime because as held
single complaint or information but the accused fails to object to it in People v. Nelmida,35 "each act by each gunman pulling the trigger
before trial, the court may convict him of as many offenses as are of their respective firearms, aiming each particular moment at
charged and proved, and impose upon him the proper penalty for each different persons constitute distinct and individual acts which cannot
offense.31 give rise to a complex crime."36
Furthermore, the Court notes that both the trial court and the CA failed court should have appreciated dwelling as an ordinary aggravating
to take into account dwelling as an ordinary, aggravating circumstance.
circumstance, despite the fact that the Informations in Criminal Case
Nos. 7698-G and 7702-G contain sufficient allegations to that effect, In view of the attendant ordinary aggravating circumstance, the Court
to wit: must modify the penalties imposed on appellant. Murder is punishable
by reclusion perpetua to death, thus, with an ordinary aggravating
Criminal Case No. 7698-G for Double Murder: circumstance of dwelling, the imposable penalty is death for each of
two (2) counts of murder.41 However, pursuant to Republic Act (RA)
That the crime was committed in the dwelling of the offended No. 9346, proscribing the imposition of the death penalty, the penalty
party who had not given provocation for the attack and the accused to be imposed on appellant should be reclusion perpetua for each of
took advantage of nighttime to facilitate the commission of the the two (2) counts of murder without eligibility for parole. With regard
offense.37 to the four (4) counts of attempted murder, the penalty prescribed for
each count is prision mayor. With one ordinary aggravating
Criminal Case No. 7702-G for Multiple Attempted Murder: circumstance, the penalty should be imposed in its maximum period.
Applying the Indeterminate Sentence Law, the maximum penalty
x x x the above-named accused, conspiring and confederating together should be from ten (10) years and one (1) day to twelve (12) years
and mutually helping one another, armed with short firearms of of prision mayor, while the minimum shall be taken from the penalty
undetermined calibres, with intent to kill, qualified by treachery, with next lower in degree, i.e., prision correccional, in any of its periods,
evident premeditation and abuse of superior strength, did then and or anywhere from six (6) months and one (1) day to six (6) years. This
there wilfully, unlawfully and feloniously attack, assault, and shoot Court finds it apt to impose on appellant the indeterminate penalty of
with the said firearms the house occupied by the family of Norberto four (4) years, two (2) months and one (1) day of prision
Divina, thereby commencing the commission of the crime of Murder, correccional, as minimum, to ten (10) years and one (1) day of prision
directly by overt acts, but did not perform all the acts of execution mayor, as minimum, for each of the four (4) counts of attempted
which would have produced it by reason of some cause or accident murder.
other than the spontaneous desistance of the accused x x x38
Anent the award of damages, the Court deems it proper to address the
39
In People v. Agcanas, the Court stressed that "[i]t has been held in a matter in detail as regards criminal cases where the imposable penalty
long line of cases that dwelling is aggravating because of the sanctity is reclusion perpetua to death. Generally, in these types of criminal
of privacy which the law accords to human abode. He who goes to cases, there are three kinds of damages awarded by the Court; namely:
another's house to hurt him or do him wrong is more guilty than he civil indemnity, moral, and exemplary damages. Likewise, actual
who offends him elsewhere." Dwelling aggravates a felony where the damages may be awarded or temperate damages in some instances.
crime is committed in the dwelling of the offended party provided that
the latter has not given provocation therefor. 40 The testimony of First, civil indemnity ex delicto is the indemnity authorized in our
Norberto established the fact that the group of appellant violated the criminal law for the offended party, in the amount authorized by the
victims' home by destroying the same and attacking his entire family prevailing judicial policy and apart from other proven actual damages,
therein, without provocation on the part of the latter. Hence, the trial which itself is equivalent to actual or compensatory damages in civil
law.42 This award stems from Article 100 of the RPC which states, Thus, in a crime where a person dies, in addition to the penalty of
"Every person criminally liable for a felony is also civilly liable." imprisonment imposed to the offender, the accused is also ordered to
pay the victim a sum of money as restitution. Also, it is apparent from
It is to be noted that civil indemnity is, technically, not a penalty or a Article 2206 that the law only imposes a minimum amount for awards
fine; hence, it can be increased by the Court when of civil indemnity, which is ₱3,000.00. The law did not provide for a
appropriate.43 Article 2206 of the Civil Code provides: ceiling. Thus, although the minimum amount for the award cannot be
changed, increasing the amount awarded as civil indemnity can be
Art. 2206. The amount of damages for death caused by a crime or validly modified and increased when the present circumstance
quasi-delict shall be at least three thousand pesos, even though there warrants it.44
may have been mitigating circumstances. In addition:
The second type of damages the Court awards are moral damages,
(1) The defendant shall be liable for the loss of the which are also compensatory in nature. Del Mundo v. Court of
earning capacity of the deceased, and the indemnity Appeals45 expounded on the nature and purpose of moral
shall be paid to the heirs of the latter; such indemnity damages, viz.:
shall in every case be assessed and awarded by the
court, unless the deceased on account of permanent Moral damages, upon the other hand, may be awarded to compensate
physical disability not caused by the defendant, had one for manifold injuries such as physical suffering, mental anguish,
no earning capacity at the time of his death; serious anxiety, besmirched reputation, wounded feelings and social
humiliation. These damages must be understood to be in the concept
(2) If the deceased was obliged to give support of grants, not punitive or corrective in nature, calculated to
according to the provisions of Article 291, the compensate the claimant for the injury suffered. Although incapable
recipient who is not an heir called to the decedent's of exactness and no proof of pecuniary loss is necessary in order that
inheritance by the law of testate or intestate moral damages may be awarded, the amount of indemnity being left
succession, may demand support from the person to the discretion of the court, it is imperative, nevertheless, that (1)
causing the death, for a period not exceeding five injury must have been suffered by the claimant, and (2) such injury
years, the exact duration to be fixed by the court; must have sprung from any of the cases expressed in Article
221946 and Article 222047 of the Civil Code. x x x.
(3) The spouse, legitimate and illegitimate
descendants and ascendants of the deceased may Similarly, in American jurisprudence, moral damages are treated as
demand moral damages for mental anguish by reason "compensatory damages awarded for mental pain and suffering or
of the death of the deceased. mental anguish resulting from a wrong."48 They may also be
considered and allowed "for resulting pain and suffering, and for
In our jurisdiction, civil indemnity is awarded to the offended party as humiliation, indignity, and vexation suffered by the plaintiff as result
a kind of monetary restitution or compensation to the victim for the of his or her assailant's conduct, as well as the factors of provocation,
damage or infraction that was done to the latter by the accused, which the reasonableness of the force used, the attendant humiliating
in a sense only covers the civil aspect. Precisely, it is civil indemnity. circumstances, the sex of the victim, [and] mental distress."49
The rationale for awarding moral damages has been explained associated with such circumstances as willfulness, wantonness,
in Lambert v. Heirs of Rey Castillon: "[T]he award of moral damages malice, gross negligence or recklessness, oppression, insult or fraud
is aimed at a restoration, within the limits possible, of the spiritual or gross fraud54 – that intensifies the injury. The terms punitive or
status quo ante; and therefore, it must be proportionate to the suffering vindictive damages are often used to refer to those species of damages
inflicted."50 that may be awarded against a person to punish him for his outrageous
conduct. In either case, these damages are intended in good measure
Corollarily, moral damages under Article 222051 of the Civil Code also to deter the wrongdoer and others like him from similar conduct in the
does not fix the amount of damages that can be awarded. It is future.55
discretionary upon the court, depending on the mental anguish or the
suffering of the private offended party. The amount of moral damages The term aggravating circumstances used by the Civil Code, the law
can, in relation to civil indemnity, be adjusted so long as it does not not having specified otherwise, is to be understood in its broad or
exceed the award of civil indemnity.52 generic sense. The commission of an offense has a two-pronged effect,
one on the public as it breaches the social order and the other upon the
Finally, the Civil Code of the Philippines provides, in respect to private victim as it causes personal sufferings, each of which is
exemplary damages, thus: addressed by, respectively, the prescription of heavier punishment for
the accused and by an award of additional damages to the victim. The
ART. 2229. Exemplary or corrective damages are imposed, by way of increase of the penalty or a shift to a graver felony underscores the
example or correction for the public good, in addition to the moral, exacerbation of the offense by the attendance of aggravating
temperate, liquidated or compensatory damages. circumstances, whether ordinary or qualifying, in its commission.
Unlike the criminal liability which is basically a State concern, the
ART. 2230. In criminal offenses, exemplary damages as a part of the award of damages, however, is likewise, if not primarily, intended for
civil liability may be imposed when the crime was committed with one the offended party who suffers thereby. It would make little sense for
or more aggravating circumstances. Such damages are separate and an award of exemplary damages to be due the private offended party
distinct from fines and shall be paid to the offended party. when the aggravating circumstance is ordinary but to be withheld
when it is qualifying. Withal, the ordinary or qualifying nature of an
Also known as "punitive" or "vindictive" damages, exemplary or aggravating circumstance is a distinction that should only be of
corrective damages are intended to serve as a deterrent to serious consequence to the criminal, rather than to the civil, liability of the
wrong doings, and as a vindication of undue sufferings and wanton offender. In fine, relative to the civil aspect of the case, an aggravating
circumstance, whether ordinary or qualifying, should entitle the
invasion of the rights of an injured or a punishment for those guilty of
offended party to an award of exemplary damages within the unbridled
outrageous conduct. These terms are generally, but not always, used
interchangeably. In common law, there is preference in the use of meaning of Article 2230 of the Civil Code. 56
exemplary damages when the award is to account for injury to feelings
and for the sense of indignity and humiliation suffered by a person as The reason is fairly obvious as to why the Revised Rules of Criminal
a result of an injury that has been maliciously and wantonly Procedure57 requires aggravating circumstances, whether ordinary or
inflicted,53 the theory being that there should be compensation for the qualifying, to be stated in the complaint or information. It is in order
hurt caused by the highly reprehensible conduct of the defendant – not to trample on the constitutional right of an accused to be informed
of the nature of the alleged offense that he or she has committed. A Before awarding any of the above mentioned damages, the Court,
criminal complaint or information should basically contain the however, must first consider the penalty imposed by law. Under RA
elements of the crime, as well as its qualifying and ordinary 7659 or An Act to Impose the Death Penalty on Certain Heinous
aggravating circumstances, for the court to effectively determine the Crimes, Amending for that Purpose the Revised Penal Laws, and for
proper penalty it should impose. This, however, is not similar in the Other Purposes, certain crimes under the RPC and special penal laws
recovery of civil liability. In the civil aspect, the presence of an were amended to impose the death penalty under certain
aggravating circumstance, even if not alleged in the information but circumstances.65 Under the same law, the following crimes are
proven during trial would entitle the victim to an award of exemplary punishable by reclusion perpetua: piracy in general,66 mutiny on the
damages. high seas,67 and simple rape.68 For the following crimes, RA 7659 has
imposed the penalty of reclusion perpetua to death: qualified
Being corrective in nature, exemplary damages, therefore, can be piracy;69 qualified bribery under certain
awarded, not only due to the presence of an aggravating circumstance, circumstances;70 parricide;71 murder;72 infanticide, except when
but also where the circumstances of the case show the highly committed by the mother of the child for the purpose of concealing
reprehensible or outrageous conduct of the offender. In much the same her dishonor or either of the maternal grandparents for the same
way as Article 2230 prescribes an instance when exemplary damages purpose;73 kidnapping and serious illegal detention under certain
may be awarded, Article 2229, the main provision, lays down the very circumstances;74 robbery with violence against or intimidation of
basis of the award. Thus, in People v. Matrimonio,58 the Court persons under certain circumstances;75 destructive arson, except when
imposed exemplary damages to deter other fathers with perverse death results as a consequence of the commission of any of the acts
tendencies or aberrant sexual behavior from sexually abusing their penalized under the article; 76 attempted or frustrated rape, when a
own daughters. Also, in People v. Cristobal,59 the Court awarded homicide is committed by reason or on occasion thereof;
exemplary damages on account of the moral corruption, perversity and plunder;77 and carnapping, when the driver or occupant of the
wickedness of the accused in sexually assaulting a pregnant married carnapped motor vehicle is killed or raped in the course of the
woman. In People v. Cañada,60 People v. Neverio61 and People v. commission of the carnapping or on the occasion thereof. 78 Finally,
Layco, Sr.,62 the Court awarded exemplary damages to set a public RA 7659 imposes the death penalty on the following crimes:
example, to serve as deterrent to elders who abuse and corrupt the
youth, and to protect the latter from sexual abuse. (a) In qualified bribery, when it is the public officer who asks
or demands the gift or present.
Existing jurisprudence pegs the award of exemplary damages at
₱30,000.00,63 despite the lack of any aggravating circumstance. The (b) In kidnapping and serious illegal detention: (i) when the
Court finds it proper to increase the amount to ₱50,000.00 in order to kidnapping or detention was committed for the purpose of
deter similar conduct. extorting ransom from the victim or any other person; (ii)
when the victim is killed or dies as a consequence of the
If, however, the penalty for the crime committed is death, which detention; (iii) when the victim is raped, subjected to torture
cannot be imposed because of the provisions of R.A. No. 9346, or dehumanizing acts.
prevailing jurisprudence64 sets the amount of ₱100,000.00 as
exemplary damages.
 (c) In destructive arson, when as a consequence of the 1. when in the commission of the deed there is present only
commission of any of the acts penalized under Article 320, one aggravating circumstance, the greater penalty shall be
death results. applied.

(d) In rape: (i) when by reason or on occasion of the rape, the 2. when there are neither mitigating nor aggravating
victim becomes insane or homicide is committed; (ii) when circumstances in the commission of the deed, the lesser
committed with any of the following attendant circumstances: penalty shall be applied.
(1) when the victim is under eighteen (18) years of age and
the offender is a parent, ascendant, step-parent, guardian, 3. when the commission of the act is attended by some
relative by consanguinity or affinity within the third civil mitigating circumstance and there is no aggravating
degree, or the common-law-spouse of the parent of the victim; circumstance, the lesser penalty shall be applied.
(2) when the victim is under the custody of the police or
military authorities; (3) when the rape is committed in full 4. when both mitigating and aggravating circumstances
view of the husband, parent, any of the children or other attended the commission of the act, the courts shall reasonably
relatives within the third degree of consanguinity; (4) when allow them to offset one another in consideration of their
the victim is a religious or a child below seven years old; (5) number and importance, for the purpose of applying the
when the offender knows that he is afflicted with Acquired penalty in accordance with the preceding rules, according to
Immune Deficiency Syndrome (AIDS) disease; (6) when the result of such compensation. (Revised Penal Code, Art.
committed by any member of the Armed Forces of the 63)
Philippines or the Philippine National Police or any law
enforcement agency; and (7) when by reason or on the Thus, in order to impose the proper penalty, especially in cases of
occasion of the rape, the victim has suffered permanent indivisible penalties, the court has the duty to ascertain the presence
physical mutilation. of any mitigating or aggravating circumstances. Accordingly, in
crimes where the imposable penalty is reclusion perpetua to death, the
From these heinous crimes, where the imposable penalties consist of court can impose either reclusion perpetua or death, depending on the
two (2) indivisible penalties or single indivisible penalty, all of them mitigating or aggravating circumstances present.
must be taken in relation to Article 63 of the RPC, which provides:
But with the enactment of RA 9346 or An Act Prohibiting the
Article 63. Rules for the application of indivisible penalties. - In all Imposition of Death Penalty in the Philippines, the imposition of death
cases in which the law prescribes a single indivisible penalty, it shall penalty is now prohibited. It provides that in lieu of the death penalty,
be applied by the courts regardless of any mitigating or aggravating the penalty of reclusion perpetua shall be imposed when the law
circumstances that may have attended the commission of the deed. violated makes use of the nomenclature of the penalties of the RPC. 79

In all cases in which the law prescribes a penalty composed of two As a result, the death penalty can no longer be imposed. Instead, they
indivisible penalties, the following rules shall be observed in the have to impose reclusion perpetua. Despite this, the principal
application thereof: consideration for the award of damages, following the ruling in People
v. Salome80 and People v. Quiachon,81 is "the penalty provided by law awarded as exemplary damages aside from civil indemnity and moral
or imposable for the offense because of its heinousness, not the public damages. Regardless of the attendance of qualifying aggravating
penalty actually imposed on the offender."82 circumstance, the exemplary damages shall be fixed at ₱100,000.00.
"[T]his is not only a reaction to the apathetic societal perception of the
When the circumstances surrounding the crime would justify the penal law and the financial fluctuation over time, but also an
imposition of the death penalty were it not for RA 9346, the Court has expression of the displeasure of the Court over the incidence of
ruled, as early as July 9, 1998 in People v. Victor,83 that the award of heinous crimes x x x."91
civil indemnity for the crime of rape when punishable by death should
be ₱75,000.00 We reasoned that "[t]his is not only a reaction to the When the circumstances surrounding the crime call for the imposition
apathetic societal perception of the penal law and the financial of reclusion perpetua only, there being no ordinary aggravating
fluctuations over time, but also an expression of the displeasure of the circumstance, the Court rules that the proper amounts should be
Court over the incidence of heinous crimes against chastity."84 Such ₱75,000.00 as civil indemnity, ₱75,000.00 as moral damages and
reasoning also applies to all heinous crimes found in RA 7659. The ₱75,000.00 exemplary damages, regardless of the number of
amount was later increased to ₱100,000.00.85 qualifying aggravating circumstances present.

In addition to this, the Court likewise awards moral damages. When it comes to compound and complex crimes, although the single
In People v. Arizapa,86 ₱50,000.00 was awarded as moral damages act done by the offender caused several crimes, the fact that those were
without need of pleading or proving them, for in rape cases, it is the result of a single design, the amount of civil indemnity and moral
recognized that the victim's injury is concomitant with and necessarily damages will depend on the penalty and the number of victims. For
results from the odious crime of rape to warrant per se the award of each of the victims, the heirs should be properly compensated. If it is
moral damages.87 Subsequently, the amount was increased to multiple murder without any ordinary aggravating circumstance but
₱75,000.00 in People v. Soriano88 and P100,000.00 in People v. merely a qualifying aggravating circumstance, but the penalty
Gambao.89 imposed is death because of Art. 48 of the RPC wherein the maximum
penalty shall be imposed,92 then, for every victim who dies, the heirs
Essentially, despite the fact that the death penalty cannot be imposed shall be indemnified with ₱100,000.00 as civil indemnity,
because of RA 9346, the imposable penalty as provided by the law for ₱100,000.00 as moral damages and ₱100,000.00 as exemplary
the crime, such as those found in RA 7569, must be used as the basis damages.
for awarding damages and not the actual penalty imposed.1avvphi1
In case of a special complex crime, which is different from a complex
Again, for crimes where the imposable penalty is death in view of the crime under Article 48 of the RPC, the following doctrines are
attendance of an ordinary aggravating circumstance but due to the noteworthy:
prohibition to impose the death penalty, the actual penalty imposed
is reclusion perpetua, the latest jurisprudence90 pegs the amount of In People of the Philippines v. Conrado Laog,93 this Court ruled that
₱100,000.00 as civil indemnity and ₱100,0000.00 as moral damages. special complex crime, or more properly, a composite crime, has its
For the qualifying aggravating circumstance and/or the ordinary own definition and special penalty in the Revised Penal Code, as
aggravating circumstances present, the amount of ₱100,000.00 is amended. Justice Regalado, in his Separate Opinion in the case
of People v. Barros,94 explained that composite crimes are "neither of with homicide. The word "homicide" is used in its generic sense.
the same legal basis as nor subject to the rules on complex crimes in Homicide, thus, includes murder, parricide, and infanticide. 97
Article 48 [of the Revised Penal Code], since they do not consist of a
single act giving rise to two or more grave or less grave felonies In the special complex crime of rape with homicide, the term
[compound crimes] nor do they involve an offense being a necessary "homicide" is to be understood in its generic sense, and includes
means to commit another [complex crime proper]. However, just like murder and slight physical injuries committed by reason or on
the regular complex crimes and the present case of aggravated illegal occasion of the rape.98 Hence, even if any or all of the circumstances
possession of firearms, only a single penalty is imposed for each of (treachery, abuse of superior strength and evident premeditation)
such composite crimes although composed of two or more offenses."95 alleged in the information have been duly established by the
prosecution, the same would not qualify the killing to murder and the
In People v. De Leon,96 we expounded on the special complex crime crime committed by appellant is still rape with homicide. As in the
of robbery with homicide, as follows: case of robbery with homicide, the aggravating circumstance of
treachery is to be considered as a generic aggravating circumstance
In robbery with homicide, the original criminal design of the only. Thus we ruled in People v. Macabales:99
malefactor is to commit robbery, with homicide perpetrated on the
occasion or by reason of the robbery. The intent to commit robbery Finally, appellants contend that the trial court erred in concluding that
must precede the taking of human life. The homicide may take place the aggravating circumstance of treachery is present. They aver that
before, during or after the robbery. It is only the result obtained, treachery applies to crimes against persons and not to crimes against
without reference or distinction as to the circumstances, causes or property. However, we find that the trial court in this case correctly
modes or persons intervening in the commission of the crime that has characterized treachery as a generic aggravating, rather than
to be taken into consideration. There is no such felony of robbery with qualifying, circumstance. Miguel was rendered helpless by appellants
homicide through reckless imprudence or simple negligence. The in defending himself when his arms were held by two of the attackers
constitutive elements of the crime, namely, robbery with homicide, before he was stabbed with a knife by appellant Macabales, as their
must be consummated. other companions surrounded them. In People v. Salvatierra, we ruled
that when alevosia (treachery) obtains in the special complex crime of
It is immaterial that the death would supervene by mere accident; or robbery with homicide, such treachery is to be regarded as a generic
that the victim of homicide is other than the victim of robbery, or that aggravating circumstance.
two or more persons are killed, or that aside from the homicide, rape,
intentional mutilation, or usurpation of authority, is committed by Robbery with homicide is a composite crime with its own definition
reason or on the occasion of the crime. Likewise immaterial is the fact and special penalty in the Revised Penal Code. There is no special
that the victim of homicide is one of the robbers; the felony would still complex crime of robbery with murder under the Revised Penal Code.
be robbery with homicide. Once a homicide is committed by or on the Here, treachery forms part of the circumstances proven concerning the
occasion of the robbery, the felony committed is robbery with actual commission of the complex crime. Logically it could not
homicide. All the felonies committed by reason of or on the occasion qualify the homicide to murder but, as generic aggravating
of the robbery are integrated into one and indivisible felony of robbery circumstance, it helps determine the penalty to be imposed. 100
Applying the above discussion on special complex crimes, if the There is an attempt when the offender commences the commission of
penalty is death but it cannot be imposed due to RA 9346 and what is a felony directly by overt acts, and does not perform all the acts of
actually imposed is the penalty of reclusion perpetua, the civil execution which should produce the felony by reason of some cause
indemnity and moral damages will be ₱100,000.00 each, and another or accident other than his own spontaneous desistance.
₱100,000.00 as exemplary damages in view of the heinousness of the
crime and to set an example. If there is another composite crime As discussed earlier, when the crime proven is consummated and the
included in a special complex crime and the penalty imposed is death, penalty imposed is death but reduced to reclusion perpetua because of
an additional ₱100,000.00 as civil indemnity, ₱100,000.00 moral R.A. 9346, the civil indemnity and moral damages that should be
damages and ₱100,000.00 exemplary damages shall be awarded for awarded will each be ₱100,000.00 and another ₱100,000.00 for
each composite crime committed. exemplary damages or when the circumstances of the crime call for
the imposition of reclusion perpetua only, the civil indemnity and
For example, in case of Robbery with Homicide101 wherein three (3) moral damages should be ₱75,000.00 each, as well as exemplary
people died as a consequence of the crime, the heirs of the victims damages in the amount of ₱75,000.00. If, however, the crime proven
shall be entitled to the award of damages as discussed earlier. This is is in its frustrated stage, the civil indemnity and moral damages that
true, however, only if those who were killed were the victims of the should be awarded will each be ₱50,000.00, and an award of
robbery or mere bystanders and not when those who died were the ₱25,000.00 civil indemnity and ₱25,000.00 moral damages when the
perpetrators or robbers themselves because the crime of robbery with crime proven is in its attempted stage. The difference in the amounts
homicide may still be committed even if one of the robbers awarded for the stages is mainly due to the disparity in the outcome of
dies.102 This is also applicable in robbery with rape where there is more the crime committed, in the same way that the imposable penalty
than one victim of rape. varies for each stage of the crime. The said amounts of civil indemnity
and moral damages awarded in cases of felonies in their frustrated or
In awarding civil indemnity and moral damages, it is also important to attempted stages shall be the bases when the crimes committed
determine the stage in which the crime was committed and proven constitute complex crime under Article 48 of the RPC. For example,
during the trial. Article 6 of the RPC provides: in a crime of murder with attempted murder, the amount of civil
indemnity, moral damages and exemplary damages is ₱100,000.00
Art. 6. Consummated, frustrated, and attempted felonies. - each, while in the attempted murder, the civil indemnity, moral
Consummated felonies, as well as those which are frustrated and damages and exemplary damages is ₱25,000.00 each.
attempted, are punishable.
In a special complex crime, like robbery with homicide, if, aside from
A felony is consummated when all the elements necessary for its homicide, several victims (except the robbers) sustained injuries, they
execution and accomplishment are present; and it is frustrated when shall likewise be indemnified. It must be remembered that in a special
an offender performs all the acts of execution which would produce complex crime, unlike in a complex crime, the component crimes have
the felony as a consequence but which, nevertheless, do not produce no attempted or frustrated stages because the intention of the
it by reason of causes independent of the will of the perpetrator. offender/s is to commit the principal crime which is to rob but in the
process of committing the said crime, another crime is committed. For
example, if on the occasion of a robbery with homicide, other victims
sustained injuries, regardless of the severity, the crime committed is victims are innocent, defenseless minors – one is a mere 3½-year-old
still robbery with homicide as the injuries become part of the crime, toddler, and the other a 13-year-old girl. The increase in the amount
"Homicide", in the special complex crime of robbery with homicide, of awards for damages is befitting to show not only the Court's, but all
is understood in its generic sense and now forms part of the essential of society's outrage over such crimes and wastage of lives.
element of robbery,103 which is the use of violence or the use of force
upon anything. Hence, the nature and severity of the injuries sustained In summary:
by the victims must still be determined for the purpose of awarding
civil indemnity and damages. If a victim suffered mortal wounds and I. For those crimes106 like, Murder,107 Parricide,108 Serious
could have died if not for a timely medical intervention, the victim Intentional Mutilation,109 Infanticide,110 and other crimes
should be awarded civil indemnity, moral damages, and exemplary involving death of a victim where the penalty consists of
damages equivalent to the damages awarded in a frustrated stage, and indivisible penalties:
if a victim suffered injuries that are not fatal, an award of civil
indemnity, moral damages and exemplary damages should likewise be 1.1 Where the penalty imposed is death but reduced
awarded equivalent to the damages awarded in an attempted stage. to reclusion perpetua because of RA 9346:

In other crimes that resulted in the death of a victim and the penalty a. Civil indemnity – ₱100,000.00
consists of divisible penalties, like homicide, death under tumultuous
affray, reckless imprudence resulting to homicide, the civil indemnity b. Moral damages – ₱100,000.00
awarded to the heirs of the victim shall be ₱50,000.00 and ₱50,000.00
moral damages without exemplary damages being awarded. However,
c. Exemplary damages – ₱100,000.00
an award of ₱50,000.00 exemplary damages in a crime of homicide
shall be added if there is an aggravating circumstance present that has
been proven but not alleged in the information. 1.2 Where the crime committed was not
consummated:
Aside from those discussed earlier, the Court also awards temperate
damages in certain cases. The award of ₱25,000.00 as temperate a. Frustrated:
damages in homicide or murder cases is proper when no evidence of
burial and funeral expenses is presented in the trial court. 104 Under i. Civil indemnity – ₱75,000.00
Article 2224 of the Civil Code, temperate damages may be recovered,
as it cannot be denied that the heirs of the victims suffered pecuniary ii. Moral damages – ₱75,000.00
loss although the exact amount was not proved. 105 In this case, the
Court now increases the amount to be awarded as temperate damages iii. Exemplary damages –
to ₱50,000.00. ₱75,000.00

In the case at bar, the crimes were aggravated by dwelling, and the b. Attempted:
murders committed were further made atrocious by the fact that the
 i. Civil indemnity – ₱50,000.00 iii. Exemplary damages –
₱25,000.00
ii. Exemplary damages – ₱50,000.00
II. For Simple Rape/Qualified Rape:
iii. Exemplary damages –
₱50,000.00 1.1 Where the penalty imposed is Death but reduced
to reclusion perpetua because of RA 9346:
2.1 Where the penalty imposed is reclusion
perpetua, other than the above-mentioned: a. Civil indemnity – ₱100,000.00

a. Civil indemnity – ₱75,000.00 b. Moral damages – ₱100,000.00

b. Moral damages – ₱75,000.00 c. Exemplary damages111 – ₱100,000.00

c. Exemplary damages – ₱75,000.00 1.2 Where the crime committed was not
consummated but merely attempted:112
2.2 Where the crime committed was not
consummated: a. Civil indemnity – ₱50,000.00

a. Frustrated: b. Moral damages – ₱50,000.00

i. Civil indemnity – ₱50,000.00 c. Exemplary damages – ₱50,000.00

ii. Moral damages – ₱50,000.00 2.1 Where the penalty imposed is reclusion
perpetua, other than the above-mentioned:
iii. Exemplary damages –
₱50,000.00 a. Civil indemnity – ₱75,000.00

b. Attempted: b. Moral damages – ₱75,000.00

i. Civil indemnity – ₱25,000.00 c. Exemplary damages – ₱75,000.00

ii. Moral damages – ₱25,000.00 2.2 Where the crime committed was not
consummated, but merely attempted:
 a. Civil indemnity – ₱25,000.00 exemplary damages depend on the prescribed penalty
and the penalty imposed, as the case may be.
b. Moral damages – ₱25,000.00
IV. For Special Complex Crimes like Robbery with
c. Exemplary damages – ₱25,000.00 Homicide, 113 Robbery with Rape,114 Robbery with Intentional
Mutilation, 115 Robbery with
III. For Complex crimes under Article 48 of the Revised Penal
Code where death, injuries, or sexual abuse results, the civil Arson,116 Rape with Homicide, 117 Kidnapping with
indemnity, moral damages and exemplary damages will Murder,118 Carnapping with Homicide119 or Carnapping with
depend on the penalty, extent of violence and sexual abuse; Rape,120 Highway Robbery with Homicide, 121 Qualified
and the number of victims where the penalty consists of Piracy,122 Arson with Homicide,123 Hazing with Death, Rape,
indivisible penalties: Sodomy or Mutilation124 and other crimes with death, injuries,
and sexual abuse as the composite crimes, where the penalty
1.1 Where the penalty imposed is Death but reduced consists of indivisible penalties:
to reclusion perpetua because of RA 9346:
1.1 Where the penalty imposed is Death but reduced
a. Civil indemnity – ₱100,000.00 to reclusion perpetua because of RA 9346:

b. Moral damages – ₱100,000.00 a. Civil indemnity – ₱100,000.00

c. Exemplary damages – ₱100,000.00 b. Moral damages – ₱100,000.00

1.2 Where the penalty imposed is reclusion c. Exemplary damages – ₱100,000.00

perpetua, other than the above-mentioned:
In Robbery with Intentional Mutilation, the amount of
a. Civil indemnity – ₱75,000.00 damages is the same as the above if the penalty
imposed is Death but reduced to reclusion
b. Moral damages – ₱75,000.00 perpetua although death did not occur.

c. Exemplary damages – ₱75,000.00 1.2 For the victims who suffered mortal/fatal
wounds125 and could have died if not for a timely
The above Rules apply to every victim who dies as a medical intervention, the following shall be awarded:
result of the crime committed. In other complex
crimes where death does not result, like in Forcible a. Civil indemnity – ₱75,000.00
Abduction with Rape, the civil indemnity, moral and
 b. Moral damages – ₱75,000.00 2.3 For the victims who suffered non-mortal/non-fatal
injuries:
c. Exemplary damages – ₱75,000.00
a. Civil indemnity – ₱25,000.00
1.3 For the victims who suffered non-mortal/non-fatal
injuries: b. Moral damages – ₱25,000.00

a. Civil indemnity – ₱50,000.00 c. Exemplary damages – ₱25,000.00

b. Moral damages – ₱50,000.00 In Robbery with Physical Injuries,126 the amount of

damages shall likewise be dependent on the
c. Exemplary damages – ₱50,000.00 nature/severity of the wounds sustained, whether fatal
or non-fatal.
2.1 Where the penalty imposed is reclusion
perpetua, other than the above-mentioned: The above Rules do not apply if in the crime of
Robbery with Homicide, the robber/s or perpetrator/s
a. Civil indemnity – ₱75,000.00 are themselves killed or injured in the incident.

b. Moral damages – ₱75,000.00 Where the component crime is rape, the above Rules
shall likewise apply, and that for every additional rape
c. Exemplary damages – ₱75,000.00 committed, whether against the same victim or other
victims, the victims shall be entitled to the same
In Robbery with Intentional Mutilation, the amount of damages unless the other crimes of rape are treated as
damages is the same as the above if the penalty separate crimes, in which case, the damages awarded
imposed is reclusion perpetua. to simple rape/qualified rape shall apply.

2.2 For the victims who suffered mortal/fatal wounds V. In other crimes that result in the death of a victim and the
and could have died if not for a timely medical penalty consists of divisible penalties, i.e., Homicide, Death
under Tumultuous Affray, Infanticide to conceal the
intervention, the following shall be awarded:
dishonour of the offender,127 Reckless Imprudence Resulting
to Homicide, Duel, Intentional Abortion and Unintentional
a. Civil indemnity – ₱50,000.00
Abortion, etc.:
b. Moral damages – ₱50,000.00
1.1 Where the crime was consummated:
c. Exemplary damages – ₱50,000.00
a. Civil indemnity – ₱50,000.00
 b. Moral damages – ₱50,000.00 b. Moral damages – ₱100,000.00

1.2 Where the crime committed was not c. Exemplary damages – ₱100,000.00130
consummated, except those crimes where there are no
stages, i.e., Reckless Imprudence and Death under B. For the victims who suffered mortal/fatal wounds
tumultuous affray: in the course of the rebellion and could have died if
not for a timely medical intervention, the following
a. Frustrated: shall be awarded:

i. Civil indemnity – ₱30,000.00 a. Civil indemnity – ₱75,000.00

ii. Moral damages – ₱30,000.00 b. Moral damages – ₱75,000.00

b. Attempted: c. Exemplary damages – ₱75,000.00

i. Civil indemnity – ₱20,000.00 C. For the victims who suffered non-mortal/non-fatal

injuries:
ii. Moral damages – ₱20,000.00
a. Civil indemnity – ₱50,000.00
If an aggravating circumstance was proven
during the trial, even if not alleged in the b. Moral damages – ₱50,000.00
Information,128 in addition to the above
mentioned amounts as civil indemnity and c. Exemplary damages – ₱50,000.00
moral damages, the amount of ₱50,000.00
exemplary damages for consummated; VII. In all of the above instances, when no documentary
₱30,000.00 for frustrated; and ₱20,000.00 for evidence of burial or funeral expenses is presented in court,
attempted, shall be awarded. the amount of ₱50,000.00 as temperate damages shall be
awarded.
VI. A. In the crime of Rebellion where the imposable penalty
is reclusion perpetua and death occurs in the course of the To reiterate, Article 2206 of the Civil Code provides that the minimum
rebellion, the heirs of those who died are entitled to the amount for awards of civil indemnity is P3,000.00, but does not
following:129 provide for a ceiling. Thus, although the minimum amount cannot be
changed, increasing the amount awarded as civil indemnity can be
a. Civil indemnity – ₱100,000.00 validly modified and increased when the present circumstance
warrants it.131
Prescinding from the foregoing, for the two (2) counts of murder, After all, such reinvestigation would not subject Estores and San
attended by the ordinary aggravating circumstance of dwelling, Miguel to double jeopardy because the same only attaches if the
appellant should be ordered to pay the heirs of the victims the following requisites are present: (1) a first jeopardy has attached
following damages: (1) ₱100,000.00 as civil indemnity for each of the before the second; (2) the first jeopardy has been validly terminated;
two children who died; (2) ₱100,000.00 as moral damages for each of and (3) a second jeopardy is for the same offense as in the first. In turn,
the two victims; (3) another ₱100,000.00 as exemplary damages for a first jeopardy attaches only (a) after a valid indictment; (b) before a
each of the two victims; and (4) temperate damages in the amount of competent court; (c) after arraignment; (d) when a valid plea has been
₱50,000.00 for each of the two deceased. For the four (4) counts of entered; and (e) when the accused has been acquitted or convicted, or
Attempted Murder, appellant should pay ₱50,000.00 as civil the case dismissed or otherwise terminated without his express
indemnity, ₱50,000.00 as moral damages and ₱50,000.00 as consent.133 In this case, the case against Estores and San Miguel was
exemplary damages for each of the four victims. In addition, the civil dismissed before they were arraigned. Thus, there can be no double
indemnity, moral damages, exemplary damages and temperate jeopardy to speak of. Let true justice be served by reinvestigating the
damages payable by the appellant are subject to interest at the rate of real participation, if any, of Estores and San Miguel in the killing of
six percent (6%) per annum from the finality of this decision until fully Mary Grace and Claudine Divina.
paid.132
WHEREFORE, the instant appeal is DISMISSED. The Decision of
Lastly, this Court echoes the concern of the trial court regarding the the Court of Appeals dated January 30, 2012 in CA-G.R. CR HC No.
dismissal of the charges against Gilberto Estores and Roger San 03252 is AFFIRMED with the following MODIFICATIONS:
Miguel who had been identified by Norberto Divina as the
companions of appellant on the night the shooting occurred. Norberto (1) In Criminal Case No. 7698-G, the Court finds accused-
had been very straightforward and unwavering in his identification of appellant Ireneo Jugueta GUILTY beyond reasonable doubt
Estores and San Miguel as the two other people who fired the gunshots of two (2) counts of the crime of murder defined under Article
at his family. More significantly, as noted by the prosecutor, the 248 of the Revised Penal Code, attended by the aggravating
testimonies of Estores and San Miguel, who insisted they were not at circumstance of dwelling, and hereby sentences him to suffer
the crime scene, tended to conflict with the sworn statement of Danilo two (2) terms of reclusion perpetua without eligibility for
Fajarillo, which was the basis for the Provincial Prosecutor's ruling parole under R.A. 9346. He is ORDERED to PAY the heirs
that he finds no probable cause against the two. Danilo Fajarillo's of Mary Grace Divina and Claudine Divina the following
sworn statement said that on June 6, 2002, he saw appellant with a amounts for each of the two victims: (a) ₱100,000.00 as civil
certain "Hapon" and Gilbert Estores at the crime scene, but it was only indemnity; (b) ₱100,000.00 as moral damages; (c)
appellant who was carrying a firearm and the two other people with ₱100,000.00 as exemplary damages; and (d) ₱50,000.00 as
him had no participation in the shooting incident. Said circumstances temperate damages.
bolster the credibility of Norberto Divina's testimony that Estores and
San Miguel may have been involved in the killing of his two young (2) In Criminal Case No. 7702-G, the Court finds accused-
daughters. appellant Ireneo Jugueta GUILTY beyond reasonable doubt
of four (4) counts of the crime of attempted murder defined
and penalized under Article 248 in relation to Article 51 of the
 Revised Penal Code, attended by the aggravating
circumstance of dwelling, and sentences him to suffer the
indeterminate penalty of four (4) years, two (2) months and
one (1) day of prision correccional, as minimum, to ten (10)
years and one (1) day of prision mayor, as maximum, for each
of the four (4) counts of attempted murder. He is ORDERED
to PAY moral damages in the amount of P50,000.00, civil
indemnity of P50,000.00 and exemplary damages of
PS0,000.00 to each of the four victims, namely, Norberto
Divina, Maricel Divina, Elizabeth Divina and Judy Ann
Divina.

(3) Accused-appellant Ireneo Jugueta is also ORDERED to

PAY interest at the rate of six percent (6%) per annum from
the time of finality of this decision until fully paid, to be
imposed on the civil indemnity, moral damages, exemplary
damages and temperate damages.

(4) Let the Office of the Prosecutor General, through the

Department of Justice, be FURNISHED a copy of this
Decision. The Prosecutor General is DIRECTED to
immediately conduct a REINVESTIGATION on the
possible criminal liability of Gilbert Estores and Roger San
Miguel regarding this case. Likewise, let a copy of this
Decision be furnished the Secretary of Justice for his
information and guidance.

SO ORDERED.