TORTS AND DAMAGES

(FULL TEXT)
a. Torts
iv. Definition under Philippine Law
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION

G.R. No. 116123 March 13, 1997

SERGIO F. NAGUIAT, doing business under the name and style SERGIO F. NAGUIAT ENT., INC., &
CLARK FIELD TAXI, INC., petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION (THIRD DIVISION), NATIONAL ORGANIZATION OF
WORKINGMEN and its members, LEONARDO T. GALANG, et al., respondents.

PANGANIBAN, J.:
Are private respondent-employees of petitioner Clark Field Taxi, Inc., who were separated from service
due the closure of Clark Air Base, entitled to separation pay and, if so, in what amount? Are officers of
corporations ipso facto liable jointly and severally with the companies they represent for the payment of
separation pay?
These questions are answered by the Court in resolving this petition for certiorari under Rule 65 of the
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Rules of Court assailing the Resolutions of the National Labor Relations Commission (Third Division)
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promulgated on February 28, 1994, and May 31, 1994. The February 28, 1994 Resolution affirmed with
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modifications the decision of Labor Arbiter Ariel C. Santos in NLRC Case No. RAB-III-12-2477-91. The
second Resolution denied the motion for reconsideration of herein petitioners.
The NLRC modified the decision of the labor arbiter by granting separation pay to herein individual
respondents in the increased amount of US$120.00 for every year of service or its peso equivalent, and
holding Sergio F. Naguiat Enterprises, Inc., Sergio F. Naguiat and Antolin T. Naguiat, jointly and severally
liable with Clark Field Taxi, Inc. ("CFTI").
The Facts
The following facts are derived from the records of the case:
Petitioner CFTI held a concessionaire's contract with the Army Air Force Exchange Services ("AAFES")
for the operation of taxi services within Clark Air Base. Sergio F. Naguiat was CFTI's president, while

Antolin T. Naguiat was its vice-president. Like Sergio F. Naguiat Enterprises, Incorporated ("Naguiat
Enterprises"), a trading firm, it was a family-owned corporation.
Individual respondents were previously employed by CFTI as taxicab drivers. During their employment,
they were required to pay a daily "boundary fee" in the amount of US$26.50 for those working from 1:00
a.m. to 12:00 noon, and US$27.00 for those working from 12:00 noon to 12:00 midnight. All incidental
expenses for the maintenance of the vehicles they were driving were accounted against them, including
gasoline expenses.
The drivers worked at least three to four times a week, depending on the availability of taxicabs. They
earned not less than US$15.00 daily.
In excess of that amount, however, they were required to make cash deposits to the company, which they
could later withdraw every fifteen days.
Due to the phase-out of the US military bases in the Philippines, from which Clark Air Base was not
spared, the AAFES was dissolved, and the services of individual respondents were officially terminated
on November 26, 1991.
The AAFES Taxi Drivers Association ("drivers' union"), through its local president, Eduardo Castillo, and
CFTI held negotiations as regards separation benefits that should be awarded in favor of the drivers.
They arrived at an agreement that the separated drivers will be given P500.00 for every year of service as
severance pay. Most of the drivers accepted said amount in December 1991 and January 1992.
However, individual respondents herein refused to accept theirs.
Instead, after disaffiliating themselves from the drivers' union, individual respondents, through the
National Organization of Workingmen ("NOWM"), a labor organization which they subsequently joined,
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filed a complaint against "Sergio F. Naguiat doing business under the name and style Sergio F. Naguiat
Enterprises, Inc., Army-Air Force Exchange Services (AAFES) with Mark Hooper as Area Service
Manager, Pacific Region, and AAFES Taxi Drivers Association with Eduardo Castillo as President," for
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payment of separation pay due to termination/phase-out. Said complaint was later amended to include
additional taxi drivers who were similarly situated as complainants, and CFTI with Antolin T. Naguiat as
vice president and general manager, as party respondent.
In their complaint, herein private respondents alleged that they were regular employees of Naguiat
Enterprises, although their individual applications for employment were approved by CFTI. They claimed
to have been assigned to Naguiat Enterprises after having been hired by CFTI, and that the former
thence managed, controlled and supervised their employment. They averred further that they were
entitled to separation pay based on their latest daily earnings of US$15.00 for working sixteen (16) days a
month.
In their position paper submitted to the labor arbiter, herein petitioners claimed that the cessation of
business of CFTI on November 26, 1991, was due to "great financial losses and lost business
opportunity" resulting from the phase-out of Clark Air Base brought about by the Mt. Pinatubo eruption
and the expiration of the RP-US military bases agreement. They admitted that CFTI had agreed with the
drivers' union, through its President Eduardo Castillo who claimed to have had blanket authority to
negotiate with CFTI in behalf of union members, to grant its taxi driver-employees separation pay
equivalent to P500.00 for every year of service.
The labor arbiter, finding the individual complainants to be regular workers of CFTI, ordered the latter to
pay them P1,200.00 for every year of service "for humanitarian consideration," setting aside the earlier
agreement between CFTI and the drivers' union of P500.00 for every year of service. The labor arbiter
rejected the allegation of CFTI that it was forced to close business due to "great financial losses and lost
business opportunity" since, at the time it ceased operations, CFTI was profitably earning and the

cessation of its business was due to the untimely closure of Clark Air Base. In not awarding separation
pay in accordance with the Labor Code, the labor arbiter explained:
To allow respondents exemption from its (sic) obligation to pay separation pay would be
inhuman to complainants but to impose a monetary obligation to an employer whose
profitable business was abruptly shot (sic) down by force majeure would be unfair and
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unjust to say the least.
and thus, simply awarded an amount for "humanitarian consideration."
Herein individual private respondents appealed to the NLRC. In its Resolution, the NLRC modified the
decision of the labor arbiter by granting separation pay to the private respondents. The concluding
paragraphs of the NLRC Resolution read:
The contention of complainant is partly correct. One-half month salary should be
US$120.00 but this amount can not be paid to the complainant in U.S. Dollar which is not
the legal tender in the Philippines. Paras, in commenting on Art. 1249 of the New Civil
Code, defines legal tender as "that which a debtor may compel a creditor to accept in
payment of the debt. The complainants who are the creditors in this instance can be
compelled to accept the Philippine peso which is the legal tender, in which case, the table
of conversion (exchange rate) at the time of payment or satisfaction of the judgment
should be used. However, since the choice is left to the debtor, (respondents) they may
choose to pay in US dollar." (Phoenix Assurance Co. vs. Macondray & Co. Inc., L-25048,
May 13, 1975)
In discharging the above obligations, Sergio F. Naguiat Enterprises, which is headed by
Sergio F. Naguiat and Antolin Naguiat, father and son at the same time the President and
Vice-President and General Manager, respectively, should be joined as indispensable
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party whose liability is joint and several. (Sec. 7, Rule 3, Rules of Court)
As mentioned earlier, the motion for reconsideration of herein petitioners was denied by the NLRC.
Hence, this petition with prayer for issuance of a temporary restraining order. Upon posting by the
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petitioners of a surety bond, a temporary restraining order was issued by this Court enjoining execution
of the assailed Resolutions.
Issues
The petitioners raise the following issues before this Court for resolution:
I. Whether or not public respondent NLRC (3rd Div.) committed grave abuse of discretion
amounting to lack of jurisdiction in issuing the appealed resolution;
II. Whether or not Messrs. Teofilo Rafols and Romeo N. Lopez could validly represent
herein private respondents; and,
III. Whether or not the resolution issued by public respondent is contrary to law.
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Petitioners also submit two additional issues by way of a supplement to their petition, to wit: that
Petitioners Sergio F. Naguiat and Antolin Naguiat were denied due process; and that petitioners were not
furnished copies of private respondents' appeal to the NLRC. As to the procedural lapse of insufficient
copies of the appeal, the proper forum before which petitioners should have raised it is the NLRC. They,
however, failed to question this in their motion for reconsideration. As a consequence, they are deemed
to have waived the same and voluntarily submitted themselves to the jurisdiction of the appellate body.

Anent the first issue raised in their original petition, petitioners contend that NLRC committed grave abuse
of discretion amounting to lack or excess of jurisdiction in unilaterally increasing the amount of severance
pay granted by the labor arbiter. They claim that this was not supported by substantial evidence since it
was based simply on the self-serving allegation of respondents that their monthly take-home pay was not
lower than $240.00.
On the second issue, petitioners aver that NOWM cannot make legal representations in behalf of
individual respondents who should, instead, be bound by the decision of the union (AAFES Taxi Drivers
Association) of which they were members.
As to the third issue, petitioners incessantly insist that Sergio F. Naguiat Enterprises, Inc. is a separate
and distinct juridical entity which cannot be held jointly and severally liable for the obligations of CFTI.
And similarly, Sergio F. Naguiat and Antolin Naguiat were merely officers and stockholders of CFTI and,
thus, could not be held personally accountable for corporate debts.
Lastly, Sergio and Antolin Naguiat assail the Resolution of NLRC holding them solidarily liable despite not
having been impleaded as parties to the complaint.
Individual respondents filed a comment separate from that of NOWM. In sum, both aver that petitioners
had the opportunity but failed to refute, the taxi drivers' claim of having an average monthly earning of
$240.00; that individual respondents became members of NOWM after disaffiliating themselves from the
AAFES Taxi Drivers Association which, through the manipulations of its President Eduardo Castillo,
unconscionably compromised their separation pay; and that Naguiat Enterprises, being their indirect
employer, is solidarily liable under the law for violation of the Labor Code, in this case, for nonpayment of
their separation pay.
The Solicitor General unqualifiedly supports the allegations of private respondents. In addition, he
submits that the separate personalities of respondent corporations and their officers should be
disregarded and considered one and the same as these were used to perpetrate injustice to their
employees.
The Court's Ruling
As will be discussed below, the petition is partially meritorious.
First Issue: Amount of Separation Pay
Firmly, we reiterate the rule that in a petition for certiorari filed pursuant to Rule 65 of the Rules of Court,
which is the only way a labor case may reach the Supreme Court, the petitioner/s must clearly show that
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the NLRC acted without or in excess of jurisdiction or with grave abuse of discretion.
Long-standing and well-settled in Philippine jurisprudence is the judicial dictum that findings of fact of
administrative agencies and quasi-judicial bodies, which have acquired expertise because their
jurisdiction is confined to specific matters, are generally accorded not only great respect but even finality;
and are binding upon this Court unless there is a showing of grave abuse of discretion, or where it is
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clearly shown that they were arrived at arbitrarily or in disregard of the evidence on record.
Nevertheless, this Court carefully perused the records of the instant case if only to determine whether
public respondent committed grave abuse of discretion, amounting to lack of jurisdiction, in granting the
clamor of private respondents that their separation pay should be based on the amount of $240.00,
allegedly their minimum monthly earnings as taxi drivers of petitioners.

In their amended complaint before the Regional Arbitration Branch in San Fernando, Pampanga, herein
private respondents set forth in detail the work schedule and financial arrangement they had with their
employer. Therefrom they inferred that their monthly take-home pay amounted to not less than $240.00.
Herein petitioners did not bother to refute nor offer any evidence to controvert said allegations. Remaining
undisputed, the labor arbiter adopted such facts in his decision. Petitioners did not even appeal from the
decision of the labor arbiter nor manifest any error in his findings and conclusions. Thus, petitioners are in
estoppel for not having questioned such facts when they had all opportunity to do so. Private
respondents, like petitioners, are bound by the factual findings of Respondent Commission.
Petitioners also claim that the closure of their taxi business was due to great financial losses brought
about by the eruption of Mt. Pinatubo which made the roads practically impassable to their taxicabs.
Likewise well-settled is the rule that business losses or financial reverses, in order to sustain
retrenchment of personnel or closure of business and warrant exemption from payment of separation pay,
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must be proved with clear and satisfactory evidence. The records, however, are devoid of such
evidence.
The labor arbiter, as affirmed by NLRC, correctly found that petitioners stopped their taxi business within
Clark Air Base because of the phase-out of U.S. military presence thereat. It was not due to any great
financial loss because petitioners' taxi business was earning profitably at the time of its closure.
With respect to the amount of separation pay that should be granted, Article 283 of the Labor Code
provides:
. . . In case of retrenchment to prevent losses and in cases of closures or cessation of
operations of establishment or undertaking not due to serious business losses or financial
reverses, the separation pay shall be equivalent to one (1) month pay or at least one-half
(1/2) month pay for every year of service, whichever is higher. A fraction of at least six (6)
months shall be considered one (1) whole year.
Considering the above, we find that NLRC did not commit grave abuse of discretion in ruling that
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individual respondents were entitled to separation pay in the amount $120.00 (one-half of $240.00
monthly pay) or its peso equivalent for every year of service.
Second Issue: NOWM's Personality to
Represent Individual Respondents-Employees
On the question of NOWM's authority to represent private respondents, we hold petitioners in estoppel for
not having seasonably raised this issue before the labor arbiter or the NLRC. NOWM was already a partylitigant as the organization representing the taxi driver-complainants before the labor arbiter. But
petitioners who were party-respondents in said complaint did not assail the juridical personality of NOWM
and the validity of its representations in behalf of the complaining taxi drivers before the quasi-judicial
bodies. Therefore, they are now estopped from raising such question before this Court. In any event,
petitioners acknowledged before this Court that the taxi drivers allegedly represented by NOWM, are
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themselves parties in this case.
Third Issue: Liability of PetitionerCorporations and Their Respective Officers
The resolution of this issue involves another factual finding that Naguiat Enterprises actually managed,
supervised and controlled employment terms of the taxi drivers, making it their indirect employer. As
adverted to earlier, factual findings of quasi-judicial bodies are binding upon the court in the absence of a
showing of grave abuse of discretion.

Unfortunately, the NLRC did not discuss or give any explanation for holding Naguiat Enterprises and its
officers jointly and severally liable in discharging CFTI's liability for payment of separation pay. We again
remind those concerned that decisions, however concisely written, must distinctly and clearly set forth the
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facts and law upon which they are based. This rule applies as well to dispositions by quasi-judicial and
administrative bodies.
Naguiat Enterprise Not Liable
In impleading Naguiat Enterprises as solidarily liable for the obligations of CFTI, respondents rely on
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Articles 106, 107 and 109 of the Labor Code.
Based on factual submissions of the parties, the labor arbiter, however, found that individual respondents
were regular employees of CFTI who received wages on a boundary or commission basis.
We find no reason to make a contrary finding. Labor-only contracting exists where: (1) the person
supplying workers to an employer does not have substantial capital or investment in the form of tools,
equipment, machinery, and work premises, among others; and (2) the workers recruited and placed by
such person are performing activities which are directly related to the principal business of the employer.
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Independent contractors, meanwhile, are those who exercise independent employment, contracting to
do a piece of work according to their own methods without being subject to control of their employer
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except as to the result of their Work.
From the evidence proffered by both parties, there is no substantial basis to hold that Naguiat Enterprises
is an indirect employer of individual respondents much less a labor only contractor. On the contrary,
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petitioners submitted documents such as the drivers' applications for employment with CFTI, and social
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security remittances and payroll of Naguiat Enterprises showing that none of the individual
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respondents were its employees. Moreover, in the contract between CFTI and AAFES, the former, as
concessionaire, agreed to purchase from AAFES for a certain amount within a specified period a fleet of
vehicles to be "ke(pt) on the road" by CFTI, pursuant to their concessionaire's contract. This indicates that
CFTI became the owner of the taxicabs which became the principal investment and asset of the
company.
Private respondents failed to substantiate their claim that Naguiat Enterprises managed, supervised and
controlled their employment. It appears that they were confused on the personalities of Sergio F. Naguiat
as an individual who was the president of CFTI, and Sergio F. Naguiat Enterprises, Inc., as a separate
corporate entity with a separate business. They presumed that Sergio F. Naguiat, who was at the same
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time a stockholder and director of Sergio F. Naguiat Enterprises, Inc., was managing and controlling
the taxi business on behalf of the latter. A closer scrutiny and analysis of the records, however, evince the
truth of the matter: that Sergio F. Naguiat, in supervising the taxi drivers and determining their
employment terms, was rather carrying out his responsibilities as president of CFTI. Hence, Naguiat
Enterprises as a separate corporation does not appear to be involved at all in the taxi business.
To illustrate further, we refer to the testimony of a driver-claimant on cross examination.
Atty. Suarez
Is it not true that you applied not with Sergio F. Naguiat but with Clark
Field Taxi?
Witness
I applied for (sic) Sergio F. Naguiat.

Atty. Suarez
Sergio F. Naguiat as an individual or the corporation?
Witness
Sergio F. Naguiat na tao.
Atty. Suarez
Who is Sergio F. Naguiat?
Witness
He is the one managing the Sergio F. Naguiat Enterprises and he is the
one whom we believe as our employer
Atty. Suarez
What is exactly the position of Sergio F. Naguiat with the Sergio F.
Naguiat Enterprises?
Witness
He is the owner, sir.
Atty. Suarez
How about with Clark Field Taxi Incorporated what is the position of Mr.
Naguiat?
Witness
What I know is that he is a concessionaire.
xxx xxx xxx
Atty. Suarez
But do you also know that Sergio F. Naguiat is the President of Clark
Field Taxi, Incorporated?
Witness
Yes, sir.
Atty. Suarez
How about Mr. Antolin Naguiat what is his role in the taxi services, the
operation of the Clark Field Taxi, Incorporated?

Witness
He is the vice president.

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And, although the witness insisted that Naguiat Enterprises was his employer, he could not deny that he
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received his salary from the office of CFTI inside the base.
Another driver-claimant admitted, upon the prodding of counsel for the corporations, that Naguiat
30
Enterprises was in the trading business while CFTI was in taxi services.
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In addition, the Constitution of CFTI-AAFES Taxi Drivers Association which, admittedly, was the union
of individual respondents while still working at Clark Air Base, states that members thereof are the
employees of CFTI and "(f)or collective bargaining purposes, the definite employer is the Clark Field Taxi
Inc."
From the foregoing, the ineludible conclusion is that CFTI was the actual and direct employer of individual
respondents, and that Naguiat Enterprises was neither their indirect employer nor labor-only contractor. It
was not involved at all in the taxi business.
CFTI president
solidarily liable
Petitioner-corporations would likewise want to avoid the solidary liability of their officers. To bolster their
position, Sergio F. Naguiat and Antolin T. Naguiat specifically aver that they were denied due process
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since they were not parties to the complaint below. In the broader interest of justice, we, however, hold
that Sergio F. Naguiat, in his capacity as president of CFTI, cannot be exonerated from joint and several
liability in the payment of separation pay to individual respondents.
33

A.C. Ransom Labor Union-CCLU vs. NLRC is the case in point. A.C. Ransom Corporation was a family
corporation, the stockholders of which were members of the Hernandez family. In 1973, it filed an
application for clearance to close or cease operations, which was duly granted by the Ministry of Labor
and Employment, without prejudice to the right of employees to seek redress of grievance, if any.
Backwages of 22 employees, who engaged in a strike prior to the closure, were subsequently computed
at P164,984.00. Up to September 1976, the union filed about ten (10) motions for execution against the
corporation, but none could be implemented, presumably for failure to find leviable assets of said
corporation. In its last motion for execution, the union asked that officers and agents of the company be
held personally liable for payment of the backwages. This was granted by the labor arbiter. In the
corporation's appeal to the NLRC, one of the issues raised was: "Is the judgment against a corporation to
reinstate its dismissed employees with backwages, enforceable against its officer and agents, in their
individual, private and personal capacities, who were not parties in the case where the judgment was
rendered!" The NLRC answered in the negative, on the ground that officers of a corporation are not liable
personally for official acts unless they exceeded the scope of their authority.
On certiorari, this Court reversed the NLRC and upheld the labor arbiter. In imposing joint and several
liability upon the company president, the Court, speaking through Mme. Justice Ameurfina MelencioHerrera, ratiocinated this wise:
(b) How can the foregoing (Articles 265 and 273 of the Labor Code) provisions be
implemented when the employer is a corporation? The answer is found in Article 212(c)
of the Labor Code which provides:

(c) "Employer" includes any person acting in the interest of an employer, directly or
indirectly. The term shall not include any labor organization or any of its officers or agents
except when acting as employer.
The foregoing was culled from Section 2 of RA 602, the Minimum Wage Law. Since
RANSOM is an artificial person, it must have an officer who can be presumed to be the
employer, being the "person acting in the interest of (the) employer" RANSOM. The
corporation, only in the technical sense, is the employer.
The responsible officer of an employer corporation can be held personally, not to say
even criminally, liable for nonpayment of back wages. That is the policy of the law. . . .
(c) If the policy of the law were otherwise, the corporation employer can have devious
ways for evading payment of back wages. . . .
(d) The record does not clearly identify "the officer or officers" of RANSOM directly
responsible for failure to pay the back wages of the 22 strikers. In the absence of definite
Proof in that regard, we believe it should be presumed that the responsible officer is the
President of the corporation who can be deemed the chief operation officer thereof. Thus,
in RA 602, criminal responsibility is with the "Manager or in his default, the person acting
as such." In RANSOM. the President appears to be the Manager. (Emphasis supplied.)
Sergio F. Naguiat, admittedly, was the president of CFTI who actively managed the business. Thus,
applying the ruling in A.C. Ransom, he falls within the meaning of an "employer" as contemplated by the
Labor Code, who may be held jointly and severally liable for the obligations of the corporation to its
dismissed employees.
Moreover, petitioners also conceded that both CFTI and Naguiat Enterprises were "close family
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corporations" owned by the Naguiat family. Section 100, paragraph 5, (under Title XII on Close
Corporations) of the Corporation Code, states:
(5) To the extent that the stockholders are actively engage(d) in the management or
operation of the business and affairs of a close corporation, the stockholders shall be
held to strict fiduciary duties to each other and among themselves. Said stockholders
shall be personally liable for corporate torts unless the corporation has obtained
reasonably adequate liability insurance. (emphasis supplied)
Nothing in the records show whether CFTI obtained "reasonably adequate liability insurance;"
thus, what remains is to determine whether there was corporate tort.
Our jurisprudence is wanting as to the definite scope of "corporate tort." Essentially, "tort" consists in the
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violation of a right given or the omission of a duty imposed by law. Simply stated, tort is a breach of a
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legal duty. Article 283 of the Labor Code mandates the employer to grant separation pay to employees
in case of closure or cessation of operations of establishment or undertaking not due to serious business
losses or financial reverses, which is the condition obtaining at bar. CFTI failed to comply with this lawimposed duty or obligation. Consequently, its stockholder who was actively engaged in the management
or operation of the business should be held personally liable.
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Furthermore, in MAM Realty Development vs. NLRC, the Court recognized that a director or officer
may still be held solidarily liable with a corporation by specific provision of law. Thus:
. . . A corporation, being a juridical entity, may act only through its directors, officers and
employees. Obligations incurred by them, acting as such corporate agents, are not theirs

but the direct accountabilities of the corporation they represent. True, solidary liabilities
may at times be incurred but only when exceptional circumstances warrant such as,
generally, in the following cases:
xxx xxx xxx
4. When a director, trustee or officer is made, by specific provision of law, personally
liable for his corporate action. (footnotes omitted)
As pointed out earlier, the fifth paragraph of Section 100 of the Corporation Code specifically imposes
personal liability upon the stockholder actively managing or operating the business and affairs of the
close corporation.
In fact, in posting the surety bond required by this Court for the issuance of a temporary restraining order
enjoining the execution of the assailed NLRC Resolutions, only Sergio F. Naguiat, in his individual and
personal capacity, principally bound himself to comply with the obligation thereunder, i.e., "to guarantee
the payment to private respondents of any damages which they may incur by reason of the issuance of a
temporary restraining order sought, if it should be finally adjudged that said principals were not entitled
38
thereto.
The Court here finds no application to the rule that a corporate officer cannot be held solidarily liable with
39
a corporation in the absence of evidence that he had acted in bad faith or with malice. In the present
case, Sergio Naguiat is held solidarily liable for corporate tort because he had actively engaged in the
management and operation of CFTI, a close corporation.
Antolin Naguiat not personally liable
Antolin T. Naguiat was the vice president of the CFTI. Although he carried the title of "general manager"
as well, it had not been shown that he had acted in such capacity. Furthermore, no evidence on the
extent of his participation in the management or operation of the business was preferred. In this light, he
cannot be held solidarily liable for the obligations of CFTI and Sergio Naguiat to the private respondents.
Fourth Issue: No Denial of Due Process
Lastly, in petitioners' Supplement to their original petition, they assail the NLRC Resolution holding Sergio
F. Naguiat and Antolin T. Naguiat jointly and severally liable with petitioner-corporations in the payment of
separation pay, averring denial of due process since the individual Naguiats were not impleaded as
parties to the complaint.
We advert to the case of A.C. Ransom once more. The officers of the corporation were not parties to the
case when the judgment in favor of the employees was rendered. The corporate officers raised this issue
when the labor arbiter granted the motion of the employees to enforce the judgment against them. In spite
of this, the Court held the corporation president solidarily liable with the corporation.
Furthermore, Sergio and Antolin Naguiat voluntarily submitted themselves to the jurisdiction of the labor
40
arbiter when they, in their individual capacities, filed a position paper together with CFTI, before the
arbiter. They cannot now claim to have been denied due process since they availed of the opportunity to
present their positions.
WHEREFORE, the foregoing premises considered, the petition is PARTLY GRANTED. The assailed
February 28, 1994 Resolution of the NLRC is hereby MODIFIED as follows:

(1) Petitioner Clark Field Taxi, Incorporated, and Sergio F. Naguiat, president and co-owner thereof, are
ORDERED to pay, jointly and severally, the individual respondents their separation pay computed at
US$120.00 for every year of service, or its peso equivalent at the time of payment or satisfaction of the
judgment;
(2) Petitioner Sergio F. Naguiat Enterprises, Incorporated, and Antolin T. Naguiat are ABSOLVED from
liability in the payment of separation pay to individual respondents.
SO ORDERED.
Narvasa, C.J., Davide, Jr., Melo and Francisco, JJ., concur.

v. Elements
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 168512

March 20, 2007

ORLANDO D. GARCIA, JR., doing business under the name and style COMMUNITY DIAGNOSTIC
1
CENTER and BU CASTRO, Petitioners,
vs.
RANIDA D. SALVADOR and RAMON SALVADOR, Respondents.
DECISION
YNARES-SANTIAGO, J.:
2

This is a petition for review under Rule 45 of the Rules of Court assailing the February 27, 2004
3
Decision of the Court of Appeals in CA-G.R. CV No. 58668 finding petitioner Orlando D. Garcia liable for
4
gross negligence; and its June 16, 2005 Resolution denying petitioners motion for reconsideration.
On October 1, 1993, respondent Ranida D. Salvador started working as a trainee in the Accounting
Department of Limay Bulk Handling Terminal, Inc. (the Company). As a prerequisite for regular
employment, she underwent a medical examination at the Community Diagnostic Center (CDC). Garcia
who is a medical technologist, conducted the HBs Ag (Hepatitis B Surface Antigen) test and on October
5
22, 1993, CDC issued the test result indicating that Ranida was "HBs Ag: Reactive." The result bore the
name and signature of Garcia as examiner and the rubber stamp signature of Castro as pathologist.
When Ranida submitted the test result to Dr. Sto. Domingo, the Company physician, the latter apprised
her that the findings indicated that she is suffering from Hepatitis B, a liver disease. Thus, based on the
6
medical report submitted by Sto. Domingo, the Company terminated Ranidas employment for failing the
7
physical examination.
When Ranida informed her father, Ramon, about her ailment, the latter suffered a heart attack and was
confined at the Bataan Doctors Hospital. During Ramons confinement, Ranida underwent another HBs
8
Ag test at the said hospital and the result indicated that she is non-reactive. She informed Sto. Domingo

of this development but was told that the test conducted by CDC was more reliable because it used the
Micro-Elisa Method.
Thus, Ranida went back to CDC for confirmatory testing, and this time, the Anti-HBs test conducted on
9
her indicated a "Negative" result.
Ranida also underwent another HBs Ag test at the Bataan Doctors Hospital using the Micro-Elisa Method.
10
The result indicated that she was non-reactive.
Ranida submitted the test results from Bataan Doctors Hospital and CDC to the Executive Officer of the
Company who requested her to undergo another similar test before her re-employment would be
11
considered. Thus, CDC conducted another HBs Ag test on Ranida which indicated a "Negative" result.
Ma. Ruby G. Calderon, Med-Tech Officer-in-Charge of CDC, issued a Certification correcting the initial
result and explaining that the examining medical technologist (Garcia) interpreted the delayed reaction as
12
positive or reactive.
Thereafter, the Company rehired Ranida.
13

On July 25, 1994, Ranida and Ramon filed a complaint for damages against petitioner Garcia and a
purportedly unknown pathologist of CDC, claiming that, by reason of the erroneous interpretation of the
results of Ranidas examination, she lost her job and suffered serious mental anxiety, trauma and
sleepless nights, while Ramon was hospitalized and lost business opportunities.
On September 26, 1994, respondents amended their complaint
pathologist."

14

by naming Castro as the "unknown

Garcia denied the allegations of gross negligence and incompetence and reiterated the scientific
explanation for the "false positive" result of the first HBs Ag test in his December 7, 1993 letter to the
15
respondents.
For his part, Castro claimed that as pathologist, he rarely went to CDC and only when a case was
referred to him; that he did not examine Ranida; and that the test results bore only his rubber-stamp
signature.
16

On September 1, 1997, the trial court dismissed the complaint for failure of the respondents to present
sufficient evidence to prove the liability of Garcia and Castro. It held that respondents should have
presented Sto. Domingo because he was the one who interpreted the test result issued by CDC.
Likewise, respondents should have presented a medical expert to refute the testimonies of Garcia and
17
Castro regarding the medical explanation behind the conflicting test results on Ranida.
Respondents appealed to the Court of Appeals which reversed the trial courts findings, the dispositive
portion of which states:
WHEREFORE, the decision appealed from is REVERSED and SET ASIDE and another one entered
ORDERING defendant-appellee Orlando D. Garcia, Jr. to pay plaintiff-appellant Ranida D. Salvador
moral damages in the amount of P50,000.00, exemplary damages in the amount of P50,000.00 and
attorneys fees in the amount of P25,000.00.
SO ORDERED.

18

The appellate court found Garcia liable for damages for negligently issuing an erroneous HBs Ag result.
On the other hand, it exonerated Castro for lack of participation in the issuance of the results.

After the denial of his motion for reconsideration, Garcia filed the instant petition.
The main issue for resolution is whether the Court of Appeals, in reversing the decision of the trial court,
correctly found petitioner liable for damages to the respondents for issuing an incorrect HBsAG test
result.
Garcia maintains he is not negligent, thus not liable for damages, because he followed the appropriate
laboratory measures and procedures as dictated by his training and experience; and that he did
everything within his professional competence to arrive at an objective, impartial and impersonal result.
At the outset, we note that the issues raised are factual in nature. Whether a person is negligent or not is
a question of fact which we cannot pass upon in a petition for review on certiorari which is limited to
19
reviewing errors of law.
Negligence is the failure to observe for the protection of the interest of another person that degree of
20
care, precaution and vigilance which the circumstances justly demand, whereby such other person
suffers injury. For health care providers, the test of the existence of negligence is: did the health care
provider either fail to do something which a reasonably prudent health care provider would have done, or
that he or she did something that a reasonably prudent health care provider would not have done; and
21
that failure or action caused injury to the patient; if yes, then he is guilty of negligence.
Thus, the elements of an actionable conduct are: 1) duty, 2) breach, 3) injury, and 4) proximate causation.
All the elements are present in the case at bar.
Owners and operators of clinical laboratories have the duty to comply with statutes, as well as rules and
regulations, purposely promulgated to protect and promote the health of the people by preventing the
operation of substandard, improperly managed and inadequately supported clinical laboratories and by
22
improving the quality of performance of clinical laboratory examinations. Their business is impressed
with public interest, as such, high standards of performance are expected from them.
In F.F. Cruz and Co., Inc. v. Court of Appeals, we found the owner of a furniture shop liable for the
destruction of the plaintiffs house in a fire which started in his establishment in view of his failure to
comply with an ordinance which required the construction of a firewall. In Teague v. Fernandez, we stated
that where the very injury which was intended to be prevented by the ordinance has happened, noncompliance with the ordinance was not only an act of negligence, but also the proximate cause of the
23
death.
In fine, violation of a statutory duty is negligence. Where the law imposes upon a person the duty to do
something, his omission or non-performance will render him liable to whoever may be injured thereby.
Section 2 of Republic Act (R.A.) No. 4688, otherwise known as The Clinical Laboratory Law, provides:
Sec. 2. It shall be unlawful for any person to be professionally in-charge of a registered clinical laboratory
unless he is a licensed physician duly qualified in laboratory medicine and authorized by the Secretary of
Health, such authorization to be renewed annually.
No license shall be granted or renewed by the Secretary of Health for the operation and maintenance of a
clinical laboratory unless such laboratory is under the administration, direction and supervision of an
authorized physician, as provided for in the preceding paragraph.

Corollarily, Sections 9(9.1)(1), 11 and 25(25.1)(1) of the DOH Administrative Order No. 49-B Series of
1988, otherwise known as the Revised Rules and Regulations Governing the Registration, Operation and
Maintenance of Clinical Laboratories in the Philippines, read:
Sec. 9. Management of the Clinical Laboratory:
9.1 Head of the Clinical Laboratory: The head is that person who assumes technical and administrative
supervision and control of the activities in the laboratory.
For all categories of clinical laboratories, the head shall be a licensed physician certified by the Philippine
Board of Pathology in either Anatomic or Clinical Pathology or both provided that:
(1) This shall be mandatory for all categories of free-standing clinical laboratories; all tertiary category
hospital laboratories and for all secondary category hospital laboratories located in areas with sufficient
available pathologist.
xxxx
Sec. 11. Reporting: All laboratory requests shall be considered as consultations between the requesting
physician and pathologist of the laboratory. As such all laboratory reports on various examinations of
human specimens shall be construed as consultation report and shall bear the name of the pathologist or
his associate. No person in clinical laboratory shall issue a report, orally or in writing, whole portions
thereof without a directive from the pathologist or his authorized associate and only to the requesting
physician or his authorized representative except in emergencies when the results may be released as
authorized by the pathologist.
xxxx
Sec. 25. Violations:
25.1 The license to operate a clinical laboratory may be suspended or revoked by the Undersecretary of
Health for Standards and Regulation upon violation of R.A. 4688 or the rules and regulations issued in
pursuance thereto or the commission of the following acts by the persons owning or operating a clinical
laboratory and the persons under their authority.
(1) Operation of a Clinical Laboratory without a certified pathologist or qualified licensed physician
authorized by the Undersecretary of Health or without employing a registered medical technologist or a
person not registered as a medical technologist in such a position.
And Section 29(b) of R.A. No. 5527, otherwise known as The Philippine Medical Technology Act of 1969,
reads:
Section 29. Penal Provisions.- Without prejudice to the provision of the Medical Act of 1959, as amended
relating to illegal practice of Medicine, the following shall be punished by a fine of not less than two
thousand pesos nor more than five thousand pesos, or imprisonment for not less than six months nor
more than two years, or both, in the discretion of the court:
xxxx
(b) Any medical technologist, even if duly registered, who shall practice medical technology in the
Philippines without the necessary supervision of a qualified pathologist or physician authorized by the
Department of Health;

From the foregoing laws and rules, it is clear that a clinical laboratory must be administered, directed and
supervised by a licensed physician authorized by the Secretary of Health, like a pathologist who is
specially trained in methods of laboratory medicine; that the medical technologist must be under the
supervision of the pathologist or a licensed physician; and that the results of any examination may be
released only to the requesting physician or his authorized representative upon the direction of the
laboratory pathologist.
These rules are intended for the protection of the public by preventing performance of substandard
clinical examinations by laboratories whose personnel are not properly supervised. The public demands
no less than an effective and efficient performance of clinical laboratory examinations through compliance
with the quality standards set by laws and regulations.
We find that petitioner Garcia failed to comply with these standards.
First, CDC is not administered, directed and supervised by a licensed physician as required by law, but by
24
Ma. Ruby C. Calderon, a licensed Medical Technologist. In the License to Open and Operate a Clinical
Laboratory for the years 1993 and 1996 issued by Dr. Juan R. Naagas, M.D., Undersecretary for Health
25
Facilities, Standards and Regulation, defendant-appellee Castro was named as the head of CDC.
However, in his Answer with Counterclaim, he stated:
3. By way of affirmative and special defenses, defendant pathologist further avers and plead as follows:
Defendant pathologist is not the owner of the Community Diagnostic Center nor an employee of the same
nor the employer of its employees. Defendant pathologist comes to the Community Diagnostic Center
when and where a problem is referred to him. Its employees are licensed under the Medical Technology
Law (Republic Act No. 5527) and are certified by, and registered with, the Professional Regulation
Commission after having passed their Board Examinations. They are competent within the sphere of their
own profession in so far as conducting laboratory examinations and are allowed to sign for and in behalf
of the clinical laboratory. The defendant pathologist, and all pathologists in general, are hired by
laboratories for purposes of complying with the rules and regulations and orders issued by the
Department of Health through the Bureau of Research and Laboratories. Defendant pathologist does not
stay that long period of time at the Community Diagnostic Center but only periodically or whenever a case
is referred to him by the laboratory. Defendant pathologist does not appoint or select the employees of
26
the laboratory nor does he arrange or approve their schedules of duty.
Castros infrequent visit to the clinical laboratory barely qualifies as an effective administrative supervision
and control over the activities in the laboratory. "Supervision and control" means the authority to act
directly whenever a specific function is entrusted by law or regulation to a subordinate; direct the
performance of duty; restrain the commission of acts; review, approve, revise or modify acts and
27
decisions of subordinate officials or units.
Second, Garcia conducted the HBsAG test of respondent Ranida without the supervision of defendantappellee Castro, who admitted that:
[He] does not know, and has never known or met, the plaintiff-patient even up to this time nor has he
personally examined any specimen, blood, urine or any other tissue, from the plaintiff-patient otherwise
his own handwritten signature would have appeared in the result and not merely stamped as shown in
28
Annex "B" of the Amended Complaint.
Last, the disputed HBsAG test result was released to respondent Ranida without the authorization of
29
defendant-appellee Castro.
Garcia may not have intended to cause the consequences which followed after the release of the HBsAG
test result. However, his failure to comply with the laws and rules promulgated and issued for the

protection of public safety and interest is failure to observe that care which a reasonably prudent health
care provider would observe. Thus, his act or omission constitutes a breach of duty.
Indubitably, Ranida suffered injury as a direct consequence of Garcias failure to comply with the mandate
of the laws and rules aforequoted. She was terminated from the service for failing the physical
examination; suffered anxiety because of the diagnosis; and was compelled to undergo several more
tests. All these could have been avoided had the proper safeguards been scrupulously followed in
conducting the clinical examination and releasing the clinical report.
Article 20 of the New Civil Code provides:
Art. 20. Every person who, contrary to law, willfully or negligently causes damage to another, shall
indemnify the latter for the same.
The foregoing provision provides the legal basis for the award of damages to a party who suffers damage
30
whenever one commits an act in violation of some legal provision. This was incorporated by the Code
Commission to provide relief to a person who suffers damage because another has violated some legal
31
provision.
We find the Court of Appeals award of moral damages reasonable under the circumstances bearing in
mind the mental trauma suffered by respondent Ranida who thought she was afflicted by Hepatitis B,
32
making her "unfit or unsafe for any type of employment." Having established her right to moral
damages, we see no reason to disturb the award of exemplary damages and attorneys fees. Exemplary
damages are imposed, by way of example or correction for the public good, in addition to moral,
33
temperate, liquidated or compensatory damages, and attorneys fees may be recovered when, as in the
34
instant case, exemplary damages are awarded.
WHEREFORE, the Decision of the Court of Appeals in CA-G.R. CV No. 58668 dated February 27, 2004
finding petitioner Orlando D. Garcia, Jr. guilty of gross negligence and liable to pay to respondents
P50,000.00 as moral damages, P50,000.00 as exemplary damages, and P25,000.00 as attorneys fees,
is AFFIRMED.
SO ORDERED.
CONSUELO YNARES-SANTIAGO
Associate Justice

II. QUASI-DELICT
a. Historical Background
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-48006

July 8, 1942

FAUSTO BARREDO, petitioner,

vs.
SEVERINO GARCIA and TIMOTEA ALMARIO, respondents.
Celedonio P. Gloria and Antonio Barredo for petitioner.
Jose G. Advincula for respondents.
BOCOBO, J.:
This case comes up from the Court of Appeals which held the petitioner herein, Fausto Barredo, liable in
damages for the death of Faustino Garcia caused by the negligence of Pedro Fontanilla, a taxi driver
employed by said Fausto Barredo.
At about half past one in the morning of May 3, 1936, on the road between Malabon and Navotas,
Province of Rizal, there was a head-on collision between a taxi of the Malate Taxicab driven by Pedro
Fontanilla and a carretela guided by Pedro Dimapalis. The carretela was overturned, and one of its
passengers, 16-year-old boy Faustino Garcia, suffered injuries from which he died two days later. A
criminal action was filed against Fontanilla in the Court of First Instance of Rizal, and he was convicted
and sentenced to an indeterminate sentence of one year and one day to two years of prision correccional.
The court in the criminal case granted the petition that the right to bring a separate civil action be
reserved. The Court of Appeals affirmed the sentence of the lower court in the criminal case. Severino
Garcia and Timotea Almario, parents of the deceased on March 7, 1939, brought an action in the Court of
First Instance of Manila against Fausto Barredo as the sole proprietor of the Malate Taxicab and
employer of Pedro Fontanilla. On July 8, 1939, the Court of First Instance of Manila awarded damages in
favor of the plaintiffs for P2,000 plus legal interest from the date of the complaint. This decision was
modified by the Court of Appeals by reducing the damages to P1,000 with legal interest from the time the
action was instituted. It is undisputed that Fontanilla 's negligence was the cause of the mishap, as he
was driving on the wrong side of the road, and at high speed. As to Barredo's responsibility, the Court of
Appeals found:
... It is admitted that defendant is Fontanilla's employer. There is proof that he exercised the
diligence of a good father of a family to prevent damage. (See p. 22, appellant's brief.) In fact it is
shown he was careless in employing Fontanilla who had been caught several times for violation
of the Automobile Law and speeding (Exhibit A) violation which appeared in the records of the
Bureau of Public Works available to be public and to himself. Therefore, he must indemnify
plaintiffs under the provisions of article 1903 of the Civil Code.
The main theory of the defense is that the liability of Fausto Barredo is governed by the Revised Penal
Code; hence, his liability is only subsidiary, and as there has been no civil action against Pedro
Fontanilla, the person criminally liable, Barredo cannot be held responsible in the case. The petitioner's
brief states on page 10:
... The Court of Appeals holds that the petitioner is being sued for his failure to exercise all the
diligence of a good father of a family in the selection and supervision of Pedro Fontanilla to
prevent damages suffered by the respondents. In other words, The Court of Appeals insists on
applying in the case article 1903 of the Civil Code. Article 1903 of the Civil Code is found in
Chapter II, Title 16, Book IV of the Civil Code. This fact makes said article to a civil liability arising
from a crime as in the case at bar simply because Chapter II of Title 16 of Book IV of the Civil
Code, in the precise words of article 1903 of the Civil Code itself, is applicable only to "those
(obligations) arising from wrongful or negligent acts or commission not punishable by law.
The gist of the decision of the Court of Appeals is expressed thus:

... We cannot agree to the defendant's contention. The liability sought to be imposed upon him in
this action is not a civil obligation arising from a felony or a misdemeanor (the crime of Pedro
Fontanilla,), but an obligation imposed in article 1903 of the Civil Code by reason of his
negligence in the selection or supervision of his servant or employee.
The pivotal question in this case is whether the plaintiffs may bring this separate civil action against
Fausto Barredo, thus making him primarily and directly, responsible under article 1903 of the Civil Code
as an employer of Pedro Fontanilla. The defendant maintains that Fontanilla's negligence being
punishable by the Penal Code, his (defendant's) liability as an employer is only subsidiary, according to
said Penal code, but Fontanilla has not been sued in a civil action and his property has not been
exhausted. To decide the main issue, we must cut through the tangle that has, in the minds of many
confused and jumbled together delitos and cuasi delitos, or crimes under the Penal Code and fault or
negligence under articles 1902-1910 of the Civil Code. This should be done, because justice may be lost
in a labyrinth, unless principles and remedies are distinctly envisaged. Fortunately, we are aided in our
inquiry by the luminous presentation of the perplexing subject by renown jurists and we are likewise
guided by the decisions of this Court in previous cases as well as by the solemn clarity of the
consideration in several sentences of the Supreme Tribunal of Spain.
Authorities support the proposition that a quasi-delict or "culpa aquiliana " is a separate legal institution
under the Civil Code with a substantivity all its own, and individuality that is entirely apart and
independent from delict or crime. Upon this principle and on the wording and spirit article 1903 of the Civil
Code, the primary and direct responsibility of employers may be safely anchored.
The pertinent provisions of the Civil Code and Revised Penal Code are as follows:
CIVIL CODE
ART. 1089 Obligations arise from law, from contracts and quasi-contracts, and from acts and
omissions which are unlawful or in which any kind of fault or negligence intervenes.
xxx

xxx

xxx

ART. 1092. Civil obligations arising from felonies or misdemeanors shall be governed by the
provisions of the Penal Code.
ART. 1093. Those which are derived from acts or omissions in which fault or negligence, not
punishable by law, intervenes shall be subject to the provisions of Chapter II, Title XVI of this
book.
xxx

xxx

xxx

ART 1902. Any person who by an act or omission causes damage to another by his fault or
negligence shall be liable for the damage so done.
ART. 1903. The obligation imposed by the next preceding article is enforcible, not only for
personal acts and omissions, but also for those of persons for whom another is responsible.
The father and in, case of his death or incapacity, the mother, are liable for any damages caused
by the minor children who live with them.
Guardians are liable for damages done by minors or incapacitated persons subject to their
authority and living with them.

Owners or directors of an establishment or business are equally liable for any damages caused
by their employees while engaged in the branch of the service in which employed, or on occasion
of the performance of their duties.
The State is subject to the same liability when it acts through a special agent, but not if the
damage shall have been caused by the official upon whom properly devolved the duty of doing
the act performed, in which case the provisions of the next preceding article shall be applicable.
Finally, teachers or directors of arts trades are liable for any damages caused by their pupils or
apprentices while they are under their custody.
The liability imposed by this article shall cease in case the persons mentioned therein prove that
they are exercised all the diligence of a good father of a family to prevent the damage.
ART. 1904. Any person who pays for damage caused by his employees may recover from the
latter what he may have paid.
REVISED PENAL CODE
ART. 100. Civil liability of a person guilty of felony. Every person criminally liable for a felony is
also civilly liable.
ART. 101. Rules regarding civil liability in certain cases. The exemption from criminal liability
established in subdivisions 1, 2, 3, 5, and 6 of article 12 and in subdivision 4 of article 11 of this
Code does not include exemption from civil liability, which shall be enforced to the following rules:
First. In cases of subdivision, 1, 2 and 3 of article 12 the civil liability for acts committed by any
imbecile or insane person, and by a person under nine years of age, or by one over nine but
under fifteen years of age, who has acted without discernment shall devolve upon those having
such person under their legal authority or control, unless it appears that there was no fault or
negligence on their part.
Should there be no person having such insane, imbecile or minor under his authority, legal
guardianship, or control, or if such person be insolvent, said insane, imbecile, or minor shall
respond with their own property, excepting property exempt from execution, in accordance with
the civil law.
Second. In cases falling within subdivision 4 of article 11, the person for whose benefit the harm
has been prevented shall be civilly liable in proportion to the benefit which they may have
received.
The courts shall determine, in their sound discretion, the proportionate amount for which each one shall
be liable.
When the respective shares can not be equitably determined, even approximately, or when the liability
also attaches to the Government, or to the majority of the inhabitants of the town, and, in all events,
whenever the damage has been caused with the consent of the authorities or their agents,
indemnification shall be made in the manner prescribed by special laws or regulations.
Third. In cases falling within subdivisions 5 and 6 of article 12, the persons using violence or causing the
fear shall be primarily liable and secondarily, or, if there be no such persons, those doing the act shall be
liable, saving always to the latter that part of their property exempt from execution.

ART. 102. Subsidiary civil liability of innkeepers, tavern keepers and proprietors of establishment.
In default of persons criminally liable, innkeepers, tavern keepers, and any other persons or
corporation shall be civilly liable for crimes committed in their establishments, in all cases where a
violation of municipal ordinances or some general or special police regulation shall have been
committed by them or their employees.
Innkeepers are also subsidiarily liable for the restitution of goods taken by robbery or theft within
their houses lodging therein, or the person, or for the payment of the value thereof, provided that
such guests shall have notified in advance the innkeeper himself, or the person representing him,
of the deposit of such goods within the inn; and shall furthermore have followed the directions
which such innkeeper or his representative may have given them with respect to the care of and
vigilance over such goods. No liability shall attach in case of robbery with violence against or
intimidation against or intimidation of persons unless committed by the innkeeper's employees.
ART. 103. Subsidiary civil liability of other persons. The subsidiary liability established in the
next preceding article shall also apply to employers, teachers, persons, and corporations
engaged in any kind of industry for felonies committed by their servants, pupils, workmen,
apprentices, or employees in the discharge of their duties.
xxx

xxx

xxx

ART. 365. Imprudence and negligence. Any person who, by reckless imprudence, shall
commit any act which, had it been intentional, would constitute a grave felony, shall suffer the
penalty of arresto mayor in its maximum period to prision correccional in its minimum period; if it
would have constituted a less grave felony, the penalty of arresto mayor in its minimum and
medium periods shall be imposed.
Any person who, by simple imprudence or negligence, shall commit an act which would otherwise
constitute a grave felony, shall suffer the penalty of arresto mayor in its medium and maximum
periods; if it would have constituted a less serious felony, the penalty of arresto mayor in its
minimum period shall be imposed."
It will thus be seen that while the terms of articles 1902 of the Civil Code seem to be broad enough to
cover the driver's negligence in the instant case, nevertheless article 1093 limits cuasi-delitos to acts or
omissions "not punishable by law." But inasmuch as article 365 of the Revised Penal Code punishes not
only reckless but even simple imprudence or negligence, the fault or negligence under article 1902 of the
Civil Code has apparently been crowded out. It is this overlapping that makes the "confusion worse
confounded." However, a closer study shows that such a concurrence of scope in regard to negligent acts
does not destroy the distinction between the civil liability arising from a crime and the responsibility for
cuasi-delitos or culpa extra-contractual. The same negligent act causing damages may produce civil
liability arising from a crime under article 100 of the Revised Penal Code, or create an action for cuasidelito or culpa extra-contractual under articles 1902-1910 of the Civil Code.
The individuality of cuasi-delito or culpa extra-contractual looms clear and unmistakable. This legal
institution is of ancient lineage, one of its early ancestors being the Lex Aquilia in the Roman Law. In fact,
in Spanish legal terminology, this responsibility is often referred to as culpa aquiliana. The Partidas also
contributed to the genealogy of the present fault or negligence under the Civil Code; for instance, Law 6,
Title 15, of Partida 7, says: "Tenudo es de fazer emienda, porque, como quier que el non fizo a
sabiendas en dao al otro, pero acaescio por su culpa."
The distinctive nature of cuasi-delitos survives in the Civil Code. According to article 1089, one of the five
sources of obligations is this legal institution of cuasi-delito or culpa extra-contractual: "los actos . . . en
que intervenga cualquier genero de culpa o negligencia." Then article 1093 provides that this kind of

obligation shall be governed by Chapter II of Title XVI of Book IV, meaning articles 1902-0910. This
portion of the Civil Code is exclusively devoted to the legal institution of culpa aquiliana.
Some of the differences between crimes under the Penal Code and the culpa aquiliana or cuasi-delito
under the Civil Code are:
1. That crimes affect the public interest, while cuasi-delitos are only of private concern.
2. That, consequently, the Penal Code punishes or corrects the criminal act, while the Civil Code, by
means of indemnification, merely repairs the damage.
3. That delicts are not as broad as quasi-delicts, because the former are punished only if there is a penal
law clearly covering them, while the latter, cuasi-delitos, include all acts in which "any king of fault or
negligence intervenes." However, it should be noted that not all violations of the penal law produce civil
responsibility, such as begging in contravention of ordinances, violation of the game laws, infraction of the
rules of traffic when nobody is hurt. (See Colin and Capitant, "Curso Elemental de Derecho Civil," Vol. 3,
p. 728.)
Let us now ascertain what some jurists say on the separate existence of quasi-delicts and the employer's
primary and direct liability under article 1903 of the Civil Code.
Dorado Montero in his essay on "Responsibilidad" in the "Enciclopedia Juridica Espaola" (Vol. XXVII, p.
414) says:
El concepto juridico de la responsabilidad civil abarca diversos aspectos y comprende a
diferentes personas. Asi, existe una responsabilidad civil propiamente dicha, que en ningun casl
lleva aparejada responsabilidad criminal alguna, y otra que es consecuencia indeclinable de la
penal que nace de todo delito o falta."
The juridical concept of civil responsibility has various aspects and comprises different persons.
Thus, there is a civil responsibility, properly speaking, which in no case carries with it any criminal
responsibility, and another which is a necessary consequence of the penal liability as a result of
every felony or misdemeanor."
Maura, an outstanding authority, was consulted on the following case: There had been a collision
between two trains belonging respectively to the Ferrocarril Cantabrico and the Ferrocarril del Norte. An
employee of the latter had been prosecuted in a criminal case, in which the company had been made a
party as subsidiarily responsible in civil damages. The employee had been acquitted in the criminal case,
and the employer, the Ferrocarril del Norte, had also been exonerated. The question asked was whether
the Ferrocarril Cantabrico could still bring a civil action for damages against the Ferrocarril del Norte.
Maura's opinion was in the affirmative, stating in part (Maura, Dictamenes, Vol. 6, pp. 511-513):
Quedando las cosas asi, a proposito de la realidad pura y neta de los hechos, todavia menos
parece sostenible que exista cosa juzgada acerca de la obligacion civil de indemnizar los
quebrantos y menoscabos inferidos por el choque de los trenes. El titulo en que se funda la
accion para demandar el resarcimiento, no puede confundirse con las responsabilidades civiles
nacidas de delito, siquiera exista en este, sea el cual sea, una culpa rodeada de notas
agravatorias que motivan sanciones penales, mas o menos severas. La lesion causada por delito
o falta en los derechos civiles, requiere restituciones, reparaciones o indemnizaciones, que cual
la pena misma ataen al orden publico; por tal motivo vienen encomendadas, de ordinario, al
Ministerio Fiscal; y claro es que si por esta via se enmiendan los quebrantos y menoscabos, el
agraviado excusa procurar el ya conseguido desagravio; pero esta eventual coincidencia de los
efectos, no borra la diversidad originaria de las acciones civiles para pedir indemnizacion.

Estas, para el caso actual (prescindiendo de culpas contractuales, que no vendrian a cuento y
que tiene otro regimen), dimanan, segun el articulo 1902 del Codigo Civil, de toda accion u
omision, causante de daos o perjuicios, en que intervenga culpa o negligencia. Es trivial que
acciones semejantes son ejercitadas ante los Tribunales de lo civil cotidianamente, sin que la
Justicia punitiva tenga que mezclarse en los asuntos. Los articulos 18 al 21 y 121 al 128 del
Codigo Penal, atentos al espiritu y a los fines sociales y politicos del mismo, desenvuelven y
ordenan la materia de responsabilidades civiles nacidas de delito, en terminos separados del
regimen por ley comun de la culpa que se denomina aquiliana, por alusion a precedentes
legislativos del Corpus Juris. Seria intempestivo un paralelo entre aquellas ordenaciones, y la de
la obligacion de indemnizar a titulo de culpa civil; pero viene al caso y es necesaria una de las
diferenciaciones que en el tal paralelo se notarian.
Los articulos 20 y 21 del Codigo Penal, despues de distribuir a su modo las responsabilidades
civiles, entre los que sean por diversos conceptos culpables del delito o falta, las hacen
extensivas a las empresas y los establecimientos al servicio de los cuales estan los delincuentes;
pero con caracter subsidiario, o sea, segun el texto literal, en defecto de los que sean
responsables criminalmente. No coincide en ello el Codigo Civil, cuyo articulo 1903, dice; La
obligacion que impone el articulo anterior es exigible, no solo por los actos y omisiones propios,
sino por los de aquellas personas de quienes se debe responder; personas en la enumeracion
de las cuales figuran los dependientes y empleados de los establecimientos o empresas, sea por
actos del servicio, sea con ocasion de sus funciones. Por esto acontece, y se observa en la
jurisprudencia, que las empresas, despues de intervenir en las causas criminales con el caracter
subsidiario de su responsabilidad civil por razon del delito, son demandadas y condenadas
directa y aisladamente, cuando se trata de la obligacion, ante los tribunales civiles.
Siendo como se ve, diverso el titulo de esta obligacion, y formando verdadero postulado de
nuestro regimen judicial la separacion entre justicia punitiva y tribunales de lo civil, de suerte que
tienen unos y otros normas de fondo en distintos cuerpos legales, y diferentes modos de
proceder, habiendose, por aadidura, abstenido de asistir al juicio criminal la Compaia del
Ferrocarril Cantabrico, que se reservo ejercitar sus acciones, parece innegable que la de
indemnizacion por los daos y perjuicios que le irrogo el choque, no estuvo sub judice ante el
Tribunal del Jurado, ni fue sentenciada, sino que permanecio intacta, al pronunciarse el fallo de
21 de marzo. Aun cuando el veredicto no hubiese sido de inculpabilidad, mostrose mas arriba,
que tal accion quedaba legitimamente reservada para despues del proceso; pero al declararse
que no existio delito, ni responsabilidad dimanada de delito, materia unica sobre que tenian
jurisdiccion aquellos juzgadores, se redobla el motivo para la obligacion civil ex lege, y se
patentiza mas y mas que la accion para pedir su cumplimiento permanece incolume, extraa a la
cosa juzgada.
As things are, apropos of the reality pure and simple of the facts, it seems less tenable that there
should be res judicata with regard to the civil obligation for damages on account of the losses
caused by the collision of the trains. The title upon which the action for reparation is based cannot
be confused with the civil responsibilities born of a crime, because there exists in the latter,
whatever each nature, a culpa surrounded with aggravating aspects which give rise to penal
measures that are more or less severe. The injury caused by a felony or misdemeanor upon civil
rights requires restitutions, reparations, or indemnifications which, like the penalty itself, affect
public order; for this reason, they are ordinarily entrusted to the office of the prosecuting attorney;
and it is clear that if by this means the losses and damages are repaired, the injured party no
longer desires to seek another relief; but this coincidence of effects does not eliminate the
peculiar nature of civil actions to ask for indemnity.
Such civil actions in the present case (without referring to contractual faults which are not
pertinent and belong to another scope) are derived, according to article 1902 of the Civil Code,
from every act or omission causing losses and damages in which culpa or negligence intervenes.
It is unimportant that such actions are every day filed before the civil courts without the criminal

courts interfering therewith. Articles 18 to 21 and 121 to 128 of the Penal Code, bearing in mind
the spirit and the social and political purposes of that Code, develop and regulate the matter of
civil responsibilities arising from a crime, separately from the regime under common law, of culpa
which is known as aquiliana, in accordance with legislative precedent of the Corpus Juris. It
would be unwarranted to make a detailed comparison between the former provisions and that
regarding the obligation to indemnify on account of civil culpa; but it is pertinent and necessary to
point out to one of such differences.
Articles 20 and 21 of the Penal Code, after distriburing in their own way the civil responsibilities
among those who, for different reasons, are guilty of felony or misdemeanor, make such civil
responsibilities applicable to enterprises and establishments for which the guilty parties render
service, but with subsidiary character, that is to say, according to the wording of the Penal Code,
in default of those who are criminally responsible. In this regard, the Civil Code does not coincide
because article 1903 says: "The obligation imposed by the next preceding article is demandable,
not only for personal acts and omissions, but also for those of persons for whom another is
responsible." Among the persons enumerated are the subordinates and employees of
establishments or enterprises, either for acts during their service or on the occasion of their
functions. It is for this reason that it happens, and it is so observed in judicial decisions, that the
companies or enterprises, after taking part in the criminal cases because of their subsidiary civil
responsibility by reason of the crime, are sued and sentenced directly and separately with regard
to the obligation, before the civil courts.
Seeing that the title of this obligation is different, and the separation between punitive justice and
the civil courts being a true postulate of our judicial system, so that they have different
fundamental norms in different codes, as well as different modes of procedure, and inasmuch as
the Compaa del Ferrocarril Cantabrico has abstained from taking part in the criminal case and
has reserved the right to exercise its actions, it seems undeniable that the action for
indemnification for the losses and damages caused to it by the collision was not sub judice before
the Tribunal del Jurado, nor was it the subject of a sentence, but it remained intact when the
decision of March 21 was rendered. Even if the verdict had not been that of acquittal, it has
already been shown that such action had been legitimately reserved till after the criminal
prosecution; but because of the declaration of the non-existence of the felony and the nonexistence of the responsibility arising from the crime, which was the sole subject matter upon
which the Tribunal del Jurado had jurisdiction, there is greater reason for the civil obligation ex
lege, and it becomes clearer that the action for its enforcement remain intact and is not res
judicata.
Laurent, a jurist who has written a monumental work on the French Civil Code, on which the Spanish Civil
Code is largely based and whose provisions on cuasi-delito or culpa extra-contractual are similar to those
of the Spanish Civil Code, says, referring to article 1384 of the French Civil Code which corresponds to
article 1903, Spanish Civil Code:
The action can be brought directly against the person responsible (for another), without including
the author of the act. The action against the principal is accessory in the sense that it implies the
existence of a prejudicial act committed by the employee, but it is not subsidiary in the sense that
it can not be instituted till after the judgment against the author of the act or at least, that it is
subsidiary to the principal action; the action for responsibility (of the employer) is in itself a
principal action. (Laurent, Principles of French Civil Law, Spanish translation, Vol. 20, pp. 734735.)
Amandi, in his "Cuestionario del Codigo Civil Reformado" (Vol. 4, pp. 429, 430), declares that the
responsibility of the employer is principal and not subsidiary. He writes:
Cuestion 1. La responsabilidad declarada en el articulo 1903 por las acciones u omisiones de
aquellas personas por las que se debe responder, es subsidiaria? es principal? Para contestar a

esta pregunta es necesario saber, en primer lugar, en que se funda el precepto legal. Es que
realmente se impone una responsabilidad por una falta ajena? Asi parece a primera vista; pero
semejante afirmacion seria contraria a la justicia y a la maxima universal, segun la que las faltas
son personales, y cada uno responde de aquellas que le son imputables. La responsabilidad de
que tratamos se impone con ocasion de un delito o culpa, pero no por causa de ellos, sino por
causa del causi delito, esto es, de la imprudencia o de la negligencia del padre, del tutor, del
dueo o director del establecimiento, del maestro, etc. Cuando cualquiera de las personas que
enumera el articulo citado (menores de edad, incapacitados, dependientes, aprendices) causan
un dao, la ley presume que el padre, el tutor, el maestro, etc., han cometido una falta de
negligencia para prevenir o evitar el dao. Esta falta es la que la ley castiga. No hay, pues,
responsabilidad por un hecho ajeno, sino en la apariencia; en realidad la responsabilidad se
exige por un hecho propio. La idea de que esa responsabilidad sea subsidiaria es, por lo tanto,
completamente inadmisible.
Question No. 1. Is the responsibility declared in article 1903 for the acts or omissions of those
persons for who one is responsible, subsidiary or principal? In order to answer this question it is
necessary to know, in the first place, on what the legal provision is based. Is it true that there is a
responsibility for the fault of another person? It seems so at first sight; but such assertion would
be contrary to justice and to the universal maxim that all faults are personal, and that everyone is
liable for those faults that can be imputed to him. The responsibility in question is imposed on the
occasion of a crime or fault, but not because of the same, but because of the cuasi-delito, that is
to say, the imprudence or negligence of the father, guardian, proprietor or manager of the
establishment, of the teacher, etc. Whenever anyone of the persons enumerated in the article
referred to (minors, incapacitated persons, employees, apprentices) causes any damage, the law
presumes that the father, guardian, teacher, etc. have committed an act of negligence in not
preventing or avoiding the damage. It is this fault that is condemned by the law. It is, therefore,
only apparent that there is a responsibility for the act of another; in reality the responsibility
exacted is for one's own act. The idea that such responsibility is subsidiary is, therefore,
completely inadmissible.
Oyuelos, in his "Digesto: Principios, Doctrina y Jurisprudencia, Referentes al Codigo Civil Espaol," says
in Vol. VII, p. 743:
Es decir, no responde de hechos ajenos, porque se responde solo de su propia culpa, doctrina
del articulo 1902; mas por excepcion, se responde de la ajena respecto de aquellas personas
con las que media algun nexo o vinculo, que motiva o razona la responsabilidad. Esta
responsabilidad, es directa o es subsidiaria? En el orden penal, el Codigo de esta clase distingue
entre menores e incapacitados y los demas, declarando directa la primera (articulo 19) y
subsidiaria la segunda (articulos 20 y 21); pero en el orden civil, en el caso del articulo 1903, ha
de entenderse directa, por el tenor del articulo que impone la responsabilidad precisamente "por
los actos de aquellas personas de quienes se deba responder."
That is to say, one is not responsible for the acts of others, because one is liable only for his own
faults, this being the doctrine of article 1902; but, by exception, one is liable for the acts of those
persons with whom there is a bond or tie which gives rise to the responsibility. Is this
responsibility direct or subsidiary? In the order of the penal law, the Penal Code distinguishes
between minors and incapacitated persons on the one hand, and other persons on the other,
declaring that the responsibility for the former is direct (article 19), and for the latter, subsidiary
(articles 20 and 21); but in the scheme of the civil law, in the case of article 1903, the
responsibility should be understood as direct, according to the tenor of that articles, for precisely it
imposes responsibility "for the acts of those persons for whom one should be responsible."
Coming now to the sentences of the Supreme Tribunal of Spain, that court has upheld the principles
above set forth: that a quasi-delict or culpa extra-contractual is a separate and distinct legal institution,

independent from the civil responsibility arising from criminal liability, and that an employer is, under
article 1903 of the Civil Code, primarily and directly responsible for the negligent acts of his employee.
One of the most important of those Spanish decisions is that of October 21, 1910. In that case, Ramon
Lafuente died as the result of having been run over by a street car owned by the "compaia Electric
Madrilea de Traccion." The conductor was prosecuted in a criminal case but he was acquitted.
Thereupon, the widow filed a civil action against the street car company, paying for damages in the
amount of 15,000 pesetas. The lower court awarded damages; so the company appealed to the Supreme
Tribunal, alleging violation of articles 1902 and 1903 of the Civil Code because by final judgment the nonexistence of fault or negligence had been declared. The Supreme Court of Spain dismissed the appeal,
saying:
Considerando que el primer motivo del recurso se funda en el equivocado supuesto de que el
Tribunal a quo, al condonar a la compaia Electrica Madrilea al pago del dao causado con la
muerte de Ramon La fuente Izquierdo, desconoce el valor y efectos juridicos de la sentencia
absolutoria deictada en la causa criminal que se siguio por el mismo hecho, cuando es lo cierto
que de este han conocido las dos jurisdicciones bajo diferentes as pectos, y como la de lo
criminal declrao dentro de los limites de su competencia que el hecho de que se trata no era
constitutivo de delito por no haber mediado descuido o negligencia graves, lo que no excluye,
siendo este el unico fundamento del fallo absolutorio, el concurso de la culpa o negligencia no
califacadas, fuente de obligaciones civiles segun el articulo 1902 del Codigo, y que alcanzan,
segun el 1903, netre otras perosnas, a los Directores de establecimientos o empresas por los
daos causados por sus dependientes en determinadas condiciones, es manifesto que la de lo
civil, al conocer del mismo hehco baho este ultimo aspecto y al condenar a la compaia
recurrente a la indemnizacion del dao causado por uno de sus empleados, lejos de infringer los
mencionados textos, en relacion con el articulo 116 de la Ley de Enjuciamiento Criminal, se ha
atenido estrictamente a ellos, sin invadir atribuciones ajenas a su jurisdiccion propia, ni contrariar
en lo mas minimo el fallo recaido en la causa.
Considering that the first ground of the appeal is based on the mistaken supposition that the trial
court, in sentencing the Compaia Madrilea to the payment of the damage caused by the death
of Ramon Lafuente Izquierdo, disregards the value and juridical effects of the sentence of
acquittal rendered in the criminal case instituted on account of the same act, when it is a fact that
the two jurisdictions had taken cognizance of the same act in its different aspects, and as the
criminal jurisdiction declared within the limits of its authority that the act in question did not
constitute a felony because there was no grave carelessness or negligence, and this being the
only basis of acquittal, it does no exclude the co-existence of fault or negligence which is not
qualified, and is a source of civil obligations according to article 1902 of the Civil Code, affecting,
in accordance with article 1903, among other persons, the managers of establishments or
enterprises by reason of the damages caused by employees under certain conditions, it is
manifest that the civil jurisdiccion in taking cognizance of the same act in this latter aspect and in
ordering the company, appellant herein, to pay an indemnity for the damage caused by one of its
employees, far from violating said legal provisions, in relation with article 116 of the Law of
Criminal Procedure, strictly followed the same, without invading attributes which are beyond its
own jurisdiction, and without in any way contradicting the decision in that cause. (Emphasis
supplied.)
It will be noted, as to the case just cited:
First. That the conductor was not sued in a civil case, either separately or with the street car company.
This is precisely what happens in the present case: the driver, Fontanilla, has not been sued in a civil
action, either alone or with his employer.
Second. That the conductor had been acquitted of grave criminal negligence, but the Supreme Tribunal of
Spain said that this did not exclude the co-existence of fault or negligence, which is not qualified, on the

part of the conductor, under article 1902 of the Civil Code. In the present case, the taxi driver was found
guilty of criminal negligence, so that if he had even sued for his civil responsibility arising from the crime,
he would have been held primarily liable for civil damages, and Barredo would have been held
subsidiarily liable for the same. But the plaintiffs are directly suing Barredo, on his primary responsibility
because of his own presumed negligence which he did not overcome under article 1903. Thus,
there were two liabilities of Barredo: first, the subsidiary one because of the civil liability of the taxi driver
arising from the latter's criminal negligence; and, second, Barredo's primary liability as an employer under
article 1903. The plaintiffs were free to choose which course to take, and they preferred the second
remedy. In so doing, they were acting within their rights. It might be observed in passing, that the plaintiff
choose the more expeditious and effective method of relief, because Fontanilla was either in prison, or
had just been released, and besides, he was probably without property which might be seized in
enforcing any judgment against him for damages.
Third. That inasmuch as in the above sentence of October 21, 1910, the employer was held liable civilly,
notwithstanding the acquittal of the employee (the conductor) in a previous criminal case, with greater
reason should Barredo, the employer in the case at bar, be held liable for damages in a civil suit filed
against him because his taxi driver had been convicted. The degree of negligence of the conductor in the
Spanish case cited was less than that of the taxi driver, Fontanilla, because the former was acquitted in
the previous criminal case while the latter was found guilty of criminal negligence and was sentenced to
an indeterminate sentence of one year and one day to two years of prision correccional.
(See also Sentence of February 19, 1902, which is similar to the one above quoted.)
In the Sentence of the Supreme Court of Spain, dated February 14, 1919, an action was brought against
a railroad company for damages because the station agent, employed by the company, had unjustly and
fraudulently, refused to deliver certain articles consigned to the plaintiff. The Supreme Court of Spain held
that this action was properly under article 1902 of the Civil Code, the court saying:
Considerando que la sentencia discutida reconoce, en virtud de los hechos que consigna con
relacion a las pruebas del pleito: 1., que las expediciones facturadas por la compaia ferroviaria
a la consignacion del actor de las vasijas vacias que en su demanda relacionan tenian como fin
el que este las devolviera a sus remitentes con vinos y alcoholes; 2., que llegadas a su destino
tales mercanias no se quisieron entregar a dicho consignatario por el jefe de la estacion sin
motivo justificado y con intencion dolosa, y 3., que la falta de entrega de estas expediciones al
tiempo de reclamarlas el demandante le originaron daos y perjuicios en cantidad de bastante
importancia como expendedor al por mayor que era de vinos y alcoholes por las ganancias que
dejo de obtener al verse privado de servir los pedidos que se le habian hecho por los remitentes
en los envases:
Considerando que sobre esta base hay necesidad de estimar los cuatro motivos que integran
este recurso, porque la demanda inicial del pleito a que se contrae no contiene accion que nazca
del incumplimiento del contrato de transporte, toda vez que no se funda en el retraso de la
llegada de las mercancias ni de ningun otro vinculo contractual entre las partes contendientes,
careciendo, por tanto, de aplicacion el articulo 371 del Codigo de Comercio, en que
principalmente descansa el fallo recurrido, sino que se limita a pedir la reparaction de los daos y
perjuicios producidos en el patrimonio del actor por la injustificada y dolosa negativa del
porteador a la entrega de las mercancias a su nombre consignadas, segun lo reconoce la
sentencia, y cuya responsabilidad esta claramente sancionada en el articulo 1902 del Codigo
Civil, que obliga por el siguiente a la Compaia demandada como ligada con el causante de
aquellos por relaciones de caracter economico y de jurarquia administrativa.
Considering that the sentence, in question recognizes, in virtue of the facts which it declares, in
relation to the evidence in the case: (1) that the invoice issued by the railroad company in favor of
the plaintiff contemplated that the empty receptacles referred to in the complaint should be
returned to the consignors with wines and liquors; (2) that when the said merchandise reached

their destination, their delivery to the consignee was refused by the station agent without
justification and with fraudulent intent, and (3) that the lack of delivery of these goods when they
were demanded by the plaintiff caused him losses and damages of considerable importance, as
he was a wholesale vendor of wines and liquors and he failed to realize the profits when he was
unable to fill the orders sent to him by the consignors of the receptacles:
Considering that upon this basis there is need of upholding the four assignments of error, as the
original complaint did not contain any cause of action arising from non-fulfillment of a contract of
transportation, because the action was not based on the delay of the goods nor on any
contractual relation between the parties litigant and, therefore, article 371 of the Code of
Commerce, on which the decision appealed from is based, is not applicable; but it limits to asking
for reparation for losses and damages produced on the patrimony of the plaintiff on account of the
unjustified and fraudulent refusal of the carrier to deliver the goods consigned to the plaintiff as
stated by the sentence, and the carrier's responsibility is clearly laid down in article 1902 of the
Civil Code which binds, in virtue of the next article, the defendant company, because the latter is
connected with the person who caused the damage by relations of economic character and by
administrative hierarchy. (Emphasis supplied.)
The above case is pertinent because it shows that the same act may come under both the Penal Code
and the Civil Code. In that case, the action of the agent was unjustified and fraudulent and therefore could
have been the subject of a criminal action. And yet, it was held to be also a proper subject of a civil action
under article 1902 of the Civil Code. It is also to be noted that it was the employer and not the employee
who was being sued.
Let us now examine the cases previously decided by this Court.
In the leading case of Rakes vs. Atlantic Gulf and Pacific Co. (7 Phil., 359, 362-365 [year 1907]), the trial
court awarded damages to the plaintiff, a laborer of the defendant, because the latter had negligently
failed to repair a tramway in consequence of which the rails slid off while iron was being transported, and
caught the plaintiff whose leg was broken. This Court held:
It is contended by the defendant, as its first defense to the action that the necessary conclusion
from these collated laws is that the remedy for injuries through negligence lies only in a criminal
action in which the official criminally responsible must be made primarily liable and his employer
held only subsidiarily to him. According to this theory the plaintiff should have procured the arrest
of the representative of the company accountable for not repairing the track, and on his
prosecution a suitable fine should have been imposed, payable primarily by him and secondarily
by his employer.
This reasoning misconceived the plan of the Spanish codes upon this subject. Article 1093 of the
Civil Code makes obligations arising from faults or negligence not punished by the law, subject to
the provisions of Chapter II of Title XVI. Section 1902 of that chapter reads:
"A person who by an act or omission causes damage to another when there is fault or
negligence shall be obliged to repair the damage so done.
"SEC. 1903. The obligation imposed by the preceeding article is demandable, not only for
personal acts and omissions, but also for those of the persons for whom they should be
responsible.
"The father, and on his death or incapacity, the mother, is liable for the damages caused
by the minors who live with them.
xxx

xxx

xxx

"Owners or directors of an establishment or enterprise are equally liable for the damages
caused by their employees in the service of the branches in which the latter may be
employed or in the performance of their duties.
xxx

xxx

xxx

"The liability referred to in this article shall cease when the persons mentioned therein
prove that they employed all the diligence of a good father of a family to avoid the
damage."
As an answer to the argument urged in this particular action it may be sufficient to point out that
nowhere in our general statutes is the employer penalized for failure to provide or maintain safe
appliances for his workmen. His obligation therefore is one 'not punished by the laws' and falls
under civil rather than criminal jurisprudence. But the answer may be a broader one. We should
be reluctant, under any conditions, to adopt a forced construction of these scientific codes, such
as is proposed by the defendant, that would rob some of these articles of effect, would shut out
litigants against their will from the civil courts, would make the assertion of their rights dependent
upon the selection for prosecution of the proper criminal offender, and render recovery doubtful
by reason of the strict rules of proof prevailing in criminal actions. Even if these articles had
always stood alone, such a construction would be unnecessary, but clear light is thrown upon
their meaning by the provisions of the Law of Criminal Procedure of Spain (Ley de Enjuiciamiento
Criminal), which, though never in actual force in these Islands, was formerly given a suppletory or
explanatory effect. Under article 111 of this law, both classes of action, civil and criminal, might
be prosecuted jointly or separately, but while the penal action was pending the civil was
suspended. According to article 112, the penal action once started, the civil remedy should be
sought therewith, unless it had been waived by the party injured or been expressly reserved by
him for civil proceedings for the future. If the civil action alone was prosecuted, arising out of a
crime that could be enforced only on private complaint, the penal action thereunder should be
extinguished. These provisions are in harmony with those of articles 23 and 133 of our Penal
Code on the same subject.
An examination of this topic might be carried much further, but the citation of these articles
suffices to show that the civil liability was not intended to be merged in the criminal nor even to be
suspended thereby, except as expressly provided in the law. Where an individual is civilly liable
for a negligent act or omission, it is not required that the injured party should seek out a third
person criminally liable whose prosecution must be a condition precedent to the enforcement of
the civil right.
Under article 20 of the Penal Code the responsibility of an employer may be regarded as
subsidiary in respect of criminal actions against his employees only while they are in process of
prosecution, or in so far as they determine the existence of the criminal act from which liability
arises, and his obligation under the civil law and its enforcement in the civil courts is not barred
thereby unless by the election of the injured person. Inasmuch as no criminal proceeding had
been instituted, growing our of the accident in question, the provisions of the Penal Code can not
affect this action. This construction renders it unnecessary to finally determine here whether this
subsidiary civil liability in penal actions has survived the laws that fully regulated it or has been
abrogated by the American civil and criminal procedure now in force in the Philippines.
The difficulty in construing the articles of the code above cited in this case appears from the briefs
before us to have arisen from the interpretation of the words of article 1093, "fault or negligence
not punished by law," as applied to the comprehensive definition of offenses in articles 568 and
590 of the Penal Code. It has been shown that the liability of an employer arising out of his
relation to his employee who is the offender is not to be regarded as derived from negligence
punished by the law, within the meaning of articles 1902 and 1093. More than this, however, it
cannot be said to fall within the class of acts unpunished by the law, the consequence of which

are regulated by articles 1902 and 1903 of the Civil Code. The acts to which these articles are
applicable are understood to be those not growing out of pre-existing duties of the parties to one
another. But where relations already formed give rise to duties, whether springing from contract
or quasi contract, then breaches of those duties are subject to articles 1101, 1103, and 1104 of
the same code. A typical application of this distinction may be found in the consequences of a
railway accident due to defective machinery supplied by the employer. His liability to his
employee would arise out of the contract of employment, that to the passengers out of the
contract for passage, while that to the injured bystander would originate in the negligent act itself.
In Manzanares vs. Moreta, 38 Phil., 821 (year 1918), the mother of the 8 of 9-year-old child Salvador
Bona brought a civil action against Moreta to recover damages resulting from the death of the child, who
had been run over by an automobile driven and managed by the defendant. The trial court rendered
judgment requiring the defendant to pay the plaintiff the sum of P1,000 as indemnity: This Court in
affirming the judgment, said in part:
If it were true that the defendant, in coming from the southern part of Solana Street, had to stop
his auto before crossing Real Street, because he had met vehicles which were going along the
latter street or were coming from the opposite direction along Solana Street, it is to be believed
that, when he again started to run his auto across said Real Street and to continue its way along
Solana Street northward, he should have adjusted the speed of the auto which he was operating
until he had fully crossed Real Street and had completely reached a clear way on Solana Street.
But, as the child was run over by the auto precisely at the entrance of Solana Street, this accident
could not have occurred if the auto had been running at a slow speed, aside from the fact that the
defendant, at the moment of crossing Real Street and entering Solana Street, in a northward
direction, could have seen the child in the act of crossing the latter street from the sidewalk on the
right to that on the left, and if the accident had occurred in such a way that after the automobile
had run over the body of the child, and the child's body had already been stretched out on the
ground, the automobile still moved along a distance of about 2 meters, this circumstance shows
the fact that the automobile entered Solana Street from Real Street, at a high speed without the
defendant having blown the horn. If these precautions had been taken by the defendant, the
deplorable accident which caused the death of the child would not have occurred.
It will be noticed that the defendant in the above case could have been prosecuted in a criminal case
because his negligence causing the death of the child was punishable by the Penal Code. Here is
therefore a clear instance of the same act of negligence being a proper subject-matter either of a criminal
action with its consequent civil liability arising from a crime or of an entirely separate and independent civil
action for fault or negligence under article 1902 of the Civil Code. Thus, in this jurisdiction, the separate
individually of a cuasi-delito or culpa aquiliana under the Civil Code has been fully and clearly recognized,
even with regard to a negligent act for which the wrongdoer could have been prosecuted and convicted in
a criminal case and for which, after such a conviction, he could have been sued for this civil liability
arising from his crime.
Years later (in 1930) this Court had another occasion to apply the same doctrine. In Bernal and Enverso
vs. House and Tacloban Electric & Ice Plant, Ltd., 54 Phil., 327, the parents of the five-year-old child,
Purificacion Bernal, brought a civil action to recover damages for the child's death as a result of burns
caused by the fault and negligence of the defendants. On the evening of April 10, 1925, the Good Friday
procession was held in Tacloban, Leyte. Fortunata Enverso with her daughter Purificacion Bernal had
come from another municipality to attend the same. After the procession the mother and the daughter
with two others were passing along Gran Capitan Street in front of the offices of the Tacloban Electric &
Ice Plant, Ltd., owned by defendants J. V. House, when an automobile appeared from the opposite
direction. The little girl, who was slightly ahead of the rest, was so frightened by the automobile that she
turned to run, but unfortunately she fell into the street gutter where hot water from the electric plant was
flowing. The child died that same night from the burns. The trial courts dismissed the action because of
the contributory negligence of the plaintiffs. But this Court held, on appeal, that there was no contributory

negligence, and allowed the parents P1,000 in damages from J. V. House who at the time of the tragic
occurrence was the holder of the franchise for the electric plant. This Court said in part:
Although the trial judge made the findings of fact hereinbefore outlined, he nevertheless was led
to order the dismissal of the action because of the contributory negligence of the plaintiffs. It is
from this point that a majority of the court depart from the stand taken by the trial judge. The
mother and her child had a perfect right to be on the principal street of Tacloban, Leyte, on the
evening when the religious procession was held. There was nothing abnormal in allowing the
child to run along a few paces in advance of the mother. No one could foresee the coincidence of
an automobile appearing and of a frightened child running and falling into a ditch filled with hot
water. The doctrine announced in the much debated case of Rakes vs. Atlantic Gulf and Pacific
Co. ([1907]), 7 Phil., 359), still rule. Article 1902 of the Civil Code must again be enforced. The
contributory negligence of the child and her mother, if any, does not operate as a bar to recovery,
but in its strictest sense could only result in reduction of the damages.
It is most significant that in the case just cited, this Court specifically applied article 1902 of the Civil
Code. It is thus that although J. V. House could have been criminally prosecuted for reckless or simple
negligence and not only punished but also made civilly liable because of his criminal negligence,
nevertheless this Court awarded damages in an independent civil action for fault or negligence under
article 1902 of the Civil Code.
In Bahia vs. Litonjua and Leynes (30 Phil., 624 [year 1915), the action was for damages for the death of
the plaintiff's daughter alleged to have been caused by the negligence of the servant in driving an
automobile over the child. It appeared that the cause of the mishap was a defect in the steering gear. The
defendant Leynes had rented the automobile from the International Garage of Manila, to be used by him
in carrying passengers during the fiesta of Tuy, Batangas. Leynes was ordered by the lower court to pay
P1,000 as damages to the plaintiff. On appeal this Court reversed the judgment as to Leynes on the
ground that he had shown that the exercised the care of a good father of a family, thus overcoming the
presumption of negligence under article 1903. This Court said:
As to selection, the defendant has clearly shown that he exercised the care and diligence of a
good father of a family. He obtained the machine from a reputable garage and it was, so far as
appeared, in good condition. The workmen were likewise selected from a standard garage, were
duly licensed by the Government in their particular calling, and apparently thoroughly competent.
The machine had been used but a few hours when the accident occurred and it is clear from the
evidence that the defendant had no notice, either actual or constructive, of the defective condition
of the steering gear.
The legal aspect of the case was discussed by this Court thus:
Article 1903 of the Civil Code not only establishes liability in cases of negligence, but also
provides when the liability shall cease. It says:
"The liability referred to in this article shall cease when the persons mentioned therein
prove that they employed all the diligence of a good father of a family to avoid the
damage."
From this article two things are apparent: (1) That when an injury is caused by the negligence of a
servant or employee there instantly arises a presumption of law that there was negligence on the
part of the matter or employer either in the selection of the servant or employee, or in supervision
over him after the selection, or both; and (2) that presumption is juris tantum and not juris et de
jure, and consequently, may be rebutted. It follows necessarily that if the employer shows to the
satisfaction of the court that in selection and supervision he has exercised the care and diligence
of a good father of a family, the presumption is overcome and he is relieve from liability.

This theory bases the responsibility of the master ultimately on his own negligence and not on
that of his servant.
The doctrine of the case just cited was followed by this Court in Cerf vs. Medel (33 Phil., 37 [year 1915]).
In the latter case, the complaint alleged that the defendant's servant had so negligently driven an
automobile, which was operated by defendant as a public vehicle, that said automobile struck and
damaged the plaintiff's motorcycle. This Court, applying article 1903 and following the rule in Bahia vs.
Litonjua and Leynes, said in part (p. 41) that:
The master is liable for the negligent acts of his servant where he is the owner or director of a
business or enterprise and the negligent acts are committed while the servant is engaged in his
master's employment as such owner.
Another case which followed the decision in Bahia vs. Litonjua and Leynes was Cuison vs. Norton &
Harrison Co., 55 Phil., 18 (year 1930). The latter case was an action for damages brought by Cuison for
the death of his seven-year-old son Moises. The little boy was on his way to school with his sister
Marciana. Some large pieces of lumber fell from a truck and pinned the boy underneath, instantly killing
him. Two youths, Telesforo Binoya and Francisco Bautista, who were working for Ora, an employee of
defendant Norton & Harrison Co., pleaded guilty to the crime of homicide through reckless negligence
and were sentenced accordingly. This Court, applying articles 1902 and 1903, held:
The basis of civil law liability is not respondent superior but the relationship of pater familias. This
theory bases the liability of the master ultimately on his own negligence and not on that of his
servant. (Bahia vs. Litonjua and Leynes [1915], 30 Phil., 624; Cangco vs. Manila Railroad Co.
[1918], 38 Phil., 768.)
In Walter A. Smith & Co. vs. Cadwallader Gibson Lumber Co., 55 Phil., 517 (year 1930) the plaintiff
brought an action for damages for the demolition of its wharf, which had been struck by the steamer
Helen C belonging to the defendant. This Court held (p. 526):
The evidence shows that Captain Lasa at the time the plaintiff's wharf collapsed was a duly
licensed captain, authorized to navigate and direct a vessel of any tonnage, and that the appellee
contracted his services because of his reputation as a captain, according to F. C. Cadwallader.
This being so, we are of the opinion that the presumption of liability against the defendant has
been overcome by the exercise of the care and diligence of a good father of a family in selecting
Captain Lasa, in accordance with the doctrines laid down by this court in the cases cited above,
and the defendant is therefore absolved from all liability.
It is, therefore, seen that the defendant's theory about his secondary liability is negatived by the six cases
above set forth. He is, on the authority of these cases, primarily and directly responsible in damages
under article 1903, in relation to article 1902, of the Civil Code.
Let us now take up the Philippine decisions relied upon by the defendant. We study first, City of Manila
vs. Manila Electric Co., 52 Phil., 586 (year 1928). A collision between a truck of the City of Manila and a
street car of the Manila Electric Co. took place on June 8, 1925. The truck was damaged in the amount of
P1,788.27. Sixto Eustaquio, the motorman, was prosecuted for the crime of damage to property and
slight injuries through reckless imprudence. He was found guilty and sentenced to pay a fine of P900, to
indemnify the City of Manila for P1,788.27, with subsidiary imprisonment in case of insolvency. Unable to
collect the indemnity from Eustaquio, the City of Manila filed an action against the Manila Electric
Company to obtain payment, claiming that the defendant was subsidiarily liable. The main defense was
that the defendant had exercised the diligence of a good father of a family to prevent the damage. The
lower court rendered judgment in favor of the plaintiff. This Court held, in part, that this case was
governed by the Penal Code, saying:

With this preliminary point out of the way, there is no escaping the conclusion that the provisions
of the Penal Code govern. The Penal Code in easily understandable language authorizes the
determination of subsidiary liability. The Civil Code negatives its application by providing that civil
obligations arising from crimes or misdemeanors shall be governed by the provisions of the Penal
Code. The conviction of the motorman was a misdemeanor falling under article 604 of the Penal
Code. The act of the motorman was not a wrongful or negligent act or omission not punishable by
law. Accordingly, the civil obligation connected up with the Penal Code and not with article 1903
of the Civil Code. In other words, the Penal Code affirms its jurisdiction while the Civil Code
negatives its jurisdiction. This is a case of criminal negligence out of which civil liability arises and
not a case of civil negligence.
xxx

xxx

xxx

Our deduction, therefore, is that the case relates to the Penal Code and not to the Civil Code.
Indeed, as pointed out by the trial judge, any different ruling would permit the master to escape
scot-free by simply alleging and proving that the master had exercised all diligence in the
selection and training of its servants to prevent the damage. That would be a good defense to a
strictly civil action, but might or might not be to a civil action either as a part of or predicated on
conviction for a crime or misdemeanor. (By way of parenthesis, it may be said further that the
statements here made are offered to meet the argument advanced during our deliberations to the
effect that article 0902 of the Civil Code should be disregarded and codal articles 1093 and 1903
applied.)
It is not clear how the above case could support the defendant's proposition, because the Court of
Appeals based its decision in the present case on the defendant's primary responsibility under article
1903 of the Civil Code and not on his subsidiary liability arising from Fontanilla's criminal negligence. In
other words, the case of City of Manila vs. Manila Electric Co., supra, is predicated on an entirely different
theory, which is the subsidiary liability of an employer arising from a criminal act of his employee, whereas
the foundation of the decision of the Court of Appeals in the present case is the employer's primary
liability under article 1903 of the Civil Code. We have already seen that this is a proper and independent
remedy.
Arambulo vs. Manila Electric Co. (55 Phil., 75), is another case invoked by the defendant. A motorman in
the employ of the Manila Electric Company had been convicted o homicide by simple negligence and
sentenced, among other things, to pay the heirs of the deceased the sum of P1,000. An action was then
brought to enforce the subsidiary liability of the defendant as employer under the Penal Code. The
defendant attempted to show that it had exercised the diligence of a good father of a family in selecting
the motorman, and therefore claimed exemption from civil liability. But this Court held:
In view of the foregoing considerations, we are of opinion and so hold, (1) that the exemption
from civil liability established in article 1903 of the Civil Code for all who have acted with the
diligence of a good father of a family, is not applicable to the subsidiary civil liability provided in
article 20 of the Penal Code.
The above case is also extraneous to the theory of the defendant in the instant case, because the action
there had for its purpose the enforcement of the defendant's subsidiary liability under the Penal Code,
while in the case at bar, the plaintiff's cause of action is based on the defendant's primary and direct
responsibility under article 1903 of the Civil Code. In fact, the above case destroys the defendant's
contention because that decision illustrates the principle that the employer's primary responsibility under
article 1903 of the Civil Code is different in character from his subsidiary liability under the Penal Code.
In trying to apply the two cases just referred to, counsel for the defendant has failed to recognize the
distinction between civil liability arising from a crime, which is governed by the Penal Code, and the

responsibility for cuasi-delito or culpa aquiliana under the Civil Code, and has likewise failed to give the
importance to the latter type of civil action.
The defendant-petitioner also cites Francisco vs. Onrubia (46 Phil., 327). That case need not be set forth.
Suffice it to say that the question involved was also civil liability arising from a crime. Hence, it is as
inapplicable as the two cases above discussed.
The foregoing authorities clearly demonstrate the separate individuality of cuasi-delitos or culpa aquiliana
under the Civil Code. Specifically they show that there is a distinction between civil liability arising from
criminal negligence (governed by the Penal Code) and responsibility for fault or negligence under articles
1902 to 1910 of the Civil Code, and that the same negligent act may produce either a civil liability arising
from a crime under the Penal Code, or a separate responsibility for fault or negligence under articles 1902
to 1910 of the Civil Code. Still more concretely, the authorities above cited render it inescapable to
conclude that the employer in this case the defendant-petitioner is primarily and directly liable under
article 1903 of the Civil Code.
The legal provisions, authors, and cases already invoked should ordinarily be sufficient to dispose of this
case. But inasmuch as we are announcing doctrines that have been little understood in the past, it might
not be inappropriate to indicate their foundations.
Firstly, the Revised Penal Code in article 365 punishes not only reckless but also simple negligence. If we
were to hold that articles 1902 to 1910 of the Civil Code refer only to fault or negligence not punished by
law, according to the literal import of article 1093 of the Civil Code, the legal institution of culpa aquiliana
would have very little scope and application in actual life. Death or injury to persons and damage to
property through any degree of negligence even the slightest would have to be indemnified only
through the principle of civil liability arising from a crime. In such a state of affairs, what sphere would
remain for cuasi-delito or culpa aquiliana? We are loath to impute to the lawmaker any intention to bring
about a situation so absurd and anomalous. Nor are we, in the interpretation of the laws, disposed to
uphold the letter that killeth rather than the spirit that giveth life. We will not use the literal meaning of the
law to smother and render almost lifeless a principle of such ancient origin and such full-grown
development as culpa aquiliana or cuasi-delito, which is conserved and made enduring in articles 1902 to
1910 of the Spanish Civil Code.
Secondly, to find the accused guilty in a criminal case, proof of guilt beyond reasonable doubt is required,
while in a civil case, preponderance of evidence is sufficient to make the defendant pay in damages.
There are numerous cases of criminal negligence which can not be shown beyond reasonable doubt, but
can be proved by a preponderance of evidence. In such cases, the defendant can and should be made
responsible in a civil action under articles 1902 to 1910 of the Civil Code. Otherwise, there would be
many instances of unvindicated civil wrongs. Ubi jus ibi remedium.
Thirdly, to hold that there is only one way to make defendant's 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 1903 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 similar public conveyance
usually do not have sufficient means with which to pay damages. Why, then, should the plaintiff be
required in all cases to go through this roundabout, unnecessary, and probably useless procedure? In
construing the laws, courts have endeavored to shorten and facilitate the pathways of right and justice.
At this juncture, it should be said that the primary and direct responsibility of employers and their
presumed negligence are principles calculated to protect society. Workmen and employees should be
carefully chosen and supervised in order to avoid injury to the public. It is the masters or employers who

principally reap the profits resulting from the services of these servants and employees. It is but right that
they should guarantee the latter's careful conduct for the personnel and patrimonial safety of others. As
Theilhard has said, "they should reproach themselves, at least, some for their weakness, others for their
poor selection and all for their negligence." And according to Manresa, "It is much more equitable and just
that such responsibility should fall upon the principal or director who could have chosen a careful and
prudent employee, and not upon the injured person who could not exercise such selection and who used
such employee because of his confidence in the principal or director." (Vol. 12, p. 622, 2nd Ed.) Many
jurists also base this primary responsibility of the employer on the principle of representation of the
principal by the agent. Thus, Oyuelos says in the work already cited (Vol. 7, p. 747) that before third
persons the employer and employee "vienen a ser como una sola personalidad, por refundicion de la del
dependiente en la de quien le emplea y utiliza." ("become as one personality by the merging of the
person of the employee in that of him who employs and utilizes him.") All these observations acquire a
peculiar force and significance when it comes to motor accidents, and there is need of stressing and
accentuating the responsibility of owners of motor vehicles.
Fourthly, because of the broad sweep of the provisions of both the Penal Code and the Civil Code on this
subject, which has given rise to the overlapping or concurrence of spheres already discussed, and for
lack of understanding of the character and efficacy of the action for culpa aquiliana, there has grown up a
common practice to seek damages only by virtue of the civil responsibility arising from a crime, forgetting
that there is another remedy, which is by invoking articles 1902-1910 of the Civil Code. Although this
habitual method is allowed by our laws, it has nevertheless rendered practically useless and nugatory the
more expeditious and effective remedy based on culpa aquiliana or culpa extra-contractual. In the present
case, we are asked to help perpetuate this usual course. But we believe it is high time we pointed out to
the harm done by such practice and to restore the principle of responsibility for fault or negligence under
articles 1902 et seq. of the Civil Code to its full rigor. It is high time we caused the stream of quasi-delict
or culpa aquiliana to flow on its own natural channel, so that its waters may no longer be diverted into that
of a crime under the Penal Code. This will, it is believed, make for the better safeguarding of private rights
because it re-establishes an ancient and additional remedy, and for the further reason that an
independent civil action, not depending on the issues, limitations and results of a criminal prosecution,
and entirely directed by the party wronged or his counsel, is more likely to secure adequate and
efficacious redress.
In view of the foregoing, the judgment of the Court of Appeals should be and is hereby affirmed, with
costs against the defendant-petitioner.
Yulo, C.J., Moran, Ozaeta and Paras, JJ., concur.

b. Definition

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-12219

March 15, 1918

AMADO PICART, plaintiff-appellant,

vs.
FRANK SMITH, JR., defendant-appellee.

Alejo Mabanag for appellant.

G. E. Campbell for appellee.
STREET, J.:
In this action the plaintiff, Amado Picart, seeks to recover of the defendant, Frank Smith, jr., the sum of
P31,000, as damages alleged to have been caused by an automobile driven by the defendant. From a
judgment of the Court of First Instance of the Province of La Union absolving the defendant from liability
the plaintiff has appealed.
The occurrence which gave rise to the institution of this action took place on December 12, 1912, on the
Carlatan Bridge, at San Fernando, La Union. It appears that upon the occasion in question the plaintiff
was riding on his pony over said bridge. Before he had gotten half way across, the defendant approached
from the opposite direction in an automobile, going at the rate of about ten or twelve miles per hour. As
the defendant neared the bridge he saw a horseman on it and blew his horn to give warning of his
approach. He continued his course and after he had taken the bridge he gave two more successive
blasts, as it appeared to him that the man on horseback before him was not observing the rule of the
road.
The plaintiff, it appears, saw the automobile coming and heard the warning signals. However, being
perturbed by the novelty of the apparition or the rapidity of the approach, he pulled the pony closely up
against the railing on the right side of the bridge instead of going to the left. He says that the reason he
did this was that he thought he did not have sufficient time to get over to the other side. The bridge is
shown to have a length of about 75 meters and a width of 4.80 meters. As the automobile approached,
the defendant guided it toward his left, that being the proper side of the road for the machine. In so doing
the defendant assumed that the horseman would move to the other side. The pony had not as yet
exhibited fright, and the rider had made no sign for the automobile to stop. Seeing that the pony was
apparently quiet, the defendant, instead of veering to the right while yet some distance away or slowing
down, continued to approach directly toward the horse without diminution of speed. When he had gotten
quite near, there being then no possibility of the horse getting across to the other side, the defendant
quickly turned his car sufficiently to the right to escape hitting the horse alongside of the railing where it as
then standing; but in so doing the automobile passed in such close proximity to the animal that it became
frightened and turned its body across the bridge with its head toward the railing. In so doing, it as struck
on the hock of the left hind leg by the flange of the car and the limb was broken. The horse fell and its
rider was thrown off with some violence. From the evidence adduced in the case we believe that when
the accident occurred the free space where the pony stood between the automobile and the railing of the
bridge was probably less than one and one half meters. As a result of its injuries the horse died. The
plaintiff received contusions which caused temporary unconsciousness and required medical attention for
several days.
The question presented for decision is whether or not the defendant in maneuvering his car in the manner
above described was guilty of negligence such as gives rise to a civil obligation to repair the damage
done; and we are of the opinion that he is so liable. As the defendant started across the bridge, he had
the right to assume that the horse and the rider would pass over to the proper side; but as he moved
toward the center of the bridge it was demonstrated to his eyes that this would not be done; and he must
in a moment have perceived that it was too late for the horse to cross with safety in front of the moving
vehicle. In the nature of things this change of situation occurred while the automobile was yet some
distance away; and from this moment it was not longer within the power of the plaintiff to escape being
run down by going to a place of greater safety. The control of the situation had then passed entirely to the
defendant; and it was his duty either to bring his car to an immediate stop or, seeing that there were no
other persons on the bridge, to take the other side and pass sufficiently far away from the horse to avoid
the danger of collision. Instead of doing this, the defendant ran straight on until he was almost upon the
horse. He was, we think, deceived into doing this by the fact that the horse had not yet exhibited fright.
But in view of the known nature of horses, there was an appreciable risk that, if the animal in question
was unacquainted with automobiles, he might get exited and jump under the conditions which here

confronted him. When the defendant exposed the horse and rider to this danger he was, in our opinion,
negligent in the eye of the law.
The test by which to determine the existence of negligence in a particular case may be stated as follows:
Did the defendant in doing the alleged negligent act use that person would have used in the same
situation? If not, then he is guilty of negligence. The law here in effect adopts the standard supposed to
be supplied by the imaginary conduct of the discreet paterfamilias of the Roman law. The existence of
negligence in a given case is not determined by reference to the personal judgment of the actor in the
situation before him. The law considers what would be reckless, blameworthy, or negligent in the man of
ordinary intelligence and prudence and determines liability by that.
The question as to what would constitute the conduct of a prudent man in a given situation must of course
be always determined in the light of human experience and in view of the facts involved in the particular
case. Abstract speculations cannot here be of much value but this much can be profitably said:
Reasonable men govern their conduct by the circumstances which are before them or known to them.
They are not, and are not supposed to be, omniscient of the future. Hence they can be expected to take
care only when there is something before them to suggest or warn of danger. Could a prudent man, in the
case under consideration, foresee harm as a result of the course actually pursued? If so, it was the duty
of the actor to take precautions to guard against that harm. Reasonable foresight of harm, followed by
ignoring of the suggestion born of this prevision, is always necessary before negligence can be held to
exist. Stated in these terms, the proper criterion for determining the existence of negligence in a given
case is this: Conduct is said to be negligent when a prudent man in the position of the tortfeasor would
have foreseen that an effect harmful to another was sufficiently probable to warrant his foregoing conduct
or guarding against its consequences.
Applying this test to the conduct of the defendant in the present case we think that negligence is clearly
established. A prudent man, placed in the position of the defendant, would in our opinion, have
recognized that the course which he was pursuing was fraught with risk, and would therefore have
foreseen harm to the horse and the rider as reasonable consequence of that course. Under these
circumstances the law imposed on the defendant the duty to guard against the threatened harm.
It goes without saying that the plaintiff himself was not free from fault, for he was guilty of antecedent
negligence in planting himself on the wrong side of the road. But as we have already stated, the
defendant was also negligent; and in such case the problem always is to discover which agent is
immediately and directly responsible. It will be noted that the negligent acts of the two parties were not
contemporaneous, since the negligence of the defendant succeeded the negligence of the plaintiff by an
appreciable interval. Under these circumstances the law is that the person who has the last fair chance to
avoid the impending harm and fails to do so is chargeable with the consequences, without reference to
the prior negligence of the other party.
The decision in the case of Rkes vs. Atlantic, Gulf and Pacific Co. (7 Phil. Rep., 359) should perhaps be
mentioned in this connection. This Court there held that while contributory negligence on the part of the
person injured did not constitute a bar to recovery, it could be received in evidence to reduce the
damages which would otherwise have been assessed wholly against the other party. The defendant
company had there employed the plaintiff, as a laborer, to assist in transporting iron rails from a barge in
Manila harbor to the company's yards located not far away. The rails were conveyed upon cars which
were hauled along a narrow track. At certain spot near the water's edge the track gave way by reason of
the combined effect of the weight of the car and the insecurity of the road bed. The car was in
consequence upset; the rails slid off; and the plaintiff's leg was caught and broken. It appeared in
evidence that the accident was due to the effects of the typhoon which had dislodged one of the supports
of the track. The court found that the defendant company was negligent in having failed to repair the bed
of the track and also that the plaintiff was, at the moment of the accident, guilty of contributory negligence
in walking at the side of the car instead of being in front or behind. It was held that while the defendant
was liable to the plaintiff by reason of its negligence in having failed to keep the track in proper repair
nevertheless the amount of the damages should be reduced on account of the contributory negligence in

the plaintiff. As will be seen the defendant's negligence in that case consisted in an omission only. The
liability of the company arose from its responsibility for the dangerous condition of its track. In a case like
the one now before us, where the defendant was actually present and operating the automobile which
caused the damage, we do not feel constrained to attempt to weigh the negligence of the respective
parties in order to apportion the damage according to the degree of their relative fault. It is enough to say
that the negligence of the defendant was in this case the immediate and determining cause of the
accident and that the antecedent negligence of the plaintiff was a more remote factor in the case.
A point of minor importance in the case is indicated in the special defense pleaded in the defendant's
answer, to the effect that the subject matter of the action had been previously adjudicated in the court of a
justice of the peace. In this connection it appears that soon after the accident in question occurred, the
plaintiff caused criminal proceedings to be instituted before a justice of the peace charging the defendant
with the infliction of serious injuries (lesiones graves). At the preliminary investigation the defendant was
discharged by the magistrate and the proceedings were dismissed. Conceding that the acquittal of the
defendant at the trial upon the merits in a criminal prosecution for the offense mentioned would be res
adjudicata upon the question of his civil liability arising from negligence -- a point upon which it is
unnecessary to express an opinion -- the action of the justice of the peace in dismissing the criminal
proceeding upon the preliminary hearing can have no effect. (See U. S. vs. Banzuela and Banzuela, 31
Phil. Rep., 564.)
From what has been said it results that the judgment of the lower court must be reversed, and judgment
is her rendered that the plaintiff recover of the defendant the sum of two hundred pesos (P200), with
costs of other instances. The sum here awarded is estimated to include the value of the horse, medical
expenses of the plaintiff, the loss or damage occasioned to articles of his apparel, and lawful interest on
the whole to the date of this recovery. The other damages claimed by the plaintiff are remote or otherwise
of such character as not to be recoverable. So ordered.
Arellano, C.J., Torres, Carson, Araullo, Avancea, and Fisher, JJ., concur.
Johnson, J., reserves his vote.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-29889 May 31, 1979
VICTORINO CUSI and PILAR POBRE, plaintiffs-appellees,
vs.
PHILIPPINE NATIONAL RAILWAYS, defendant-appellant.
Leopoldo M. Abellera for appellant.
Francisco V. Marasigan for appellees.

GUERRERO, J.:
Direct appeal from the decision of the Court of First Instance of Rizal ordering defendant-appellant to
indemnify the plaintiffs- appellees in the total amount of Two Hundred Thirty-Nine Thousand and Six
Hundred Forty-Eight Pesos, and Seventy-Two Centavos (P239,648.72) for injuries received in a collision

caused by the gross negligence of defendant-appellant, plus Ten Thousand Pesos (P10,000.00) as
attorney's fees and expenses of litigation.
Upon the amended and supplemental complaints for damages filed by plaintiffs-appellees, the spouses
Victorino Cusi and Pilar Pobre before the Court of First Instance of Rizal against the Manila Railroad
Company, now the Philippine National Railways and duly answered by the latter and after due hearing.
the following facts appear as undisputed: On the night of October 5, 1963, plaintiffs-appellees attended a
birthday party inside the United Housing Subdivision in Paranaque, Rizal. After the party which broke up
at about 11 o'clock that evening, the plaintiffs-appellees proceeded home in their Vauxhall car with
Victorino Cusi at the wheel. Upon reaching the railroad tracks, finding that the level crossing bar was
raised and seeing that there was no flashing red light, and hearing no whistle from any coming train, Cusi
merely slack ened his speed and proceeded to cross the tracks. At the same time, a train bound for
Lucena traversed the crossing, resulting in a collision between the two. The impact threw the plaintiffsappellees out of their car which was smashed. One Benjamin Franco, who came from the same party and
was driving a vehicle right behind them, rushed to their aid and brought them. to San Juan de Dios
Hospital for emergency treatment. Later, the plaintiffs-appellees were transferred to the Philippine
General Hospital. A week later, Mrs. Cusi transferred to the Manila Doctors Hospital where Dr. Manuel
Rivera, head of the Orthopedic and Fracture Service of the Philippine General Hospital performed on her
a second operation and continued to treat her until her discharge from the hospital on November 2, 1963.
Thereafter, Dr. Rivera treated her as an out-patient until the end of February, 1964 although by that time
the fractured bones had not yet healed. Mrs. Cusi was also operated on by Dr. Francisco Aguilar, Director
of the National Orthopedic Hospital, in May, 1964 and in August, 1965, after another operation in her
upper body from the chest to the abdomen, she was placed in cast for some three (3) months and her
right arm immobilized by reason of the past
As enumerated in the Medical Certificate (Exh. "J"), Mrs. Cusi suffered the following:
(1) Fracture open middle third humerus right
(2) Fracture mandible right paramedian
(3) Fracture fibula left distal
(4) Concussion, cerebral
(5) Abrasions, multiple (face, head, lumbosacral and extremities)
(6) Lacerations (2) right temporal
(7) Contusions with hematoma left forehead and parieto occipital right.
For these injuries, she underwent a total of four surgical opera. petitions in a period of two years. As a
result of the fracture on her right arm, there was a shortening of about 1 cm. of that arm. She lost the
flexibility of her wrist, elbow and shoulder. Up to the time she took the witness stand in August, 1966, she
still had an intermedullary nail in the bone of her right arm Likewise, Victorino Cusi suffered brain injuries
which affected his speech, memory, sense of hearing and neck movement. For a long period, he also felt
pain all over his body.
Victorino Cusi claimed that prior to the accident he was a successful businessman the Special
Assistant to the Dolor Lopez Enterprises, the managing partner of Cusi and Rivera Partnership, the
manager of his ricemill, and with substantial investments in other business enterprises. As a result of his
injuries, he was unable to properly attend to his various business undertakings. On the other hand, his
wife, Pilar, was a skilled music and piano teacher. After the accident, she lost the dexterity of her fingers

forcing her to quit her profession. She also bore ugly scars on several parts of her body, and she suffered
anxiety of a possible miscarriage being then five (5) months pregnant at the time of the accident.
The defense is centered on the proposition that the gross negligence of Victorino Cusi was the proximate
cause of the collision; that had he made a full stop before traversing the crossing as required by section
56(a) of Act 3992 (Motor Vehicle Law), he could have seen and heard the approach of the train, and thus,
there would have been no collision.
After a protracted trial, the lower court rendered the decision now subject of the appeal. Defendantappellant seeks the reversal of said decision; but should we affirm the same, that the award be reduced
to a reasonable amount.
1

As the action is predicated on negligence, the New Civil Code making clear that "whoever by act or
omission causes damage to another, there being fault or negligence, is obliged to pay for the damage
done the crucial question posed in the petition at bar is the existence of negligence on the part of
defendant-appellant as found by the lower court.
1. The question of negligence being one of fact, the lower court's finding of negligence on the part of the
defendant-appellant deserves serious consideration by the Court. It commands great respect and weight,
the reason being that the trial judge, having the advantage of hearing the parties testify and of observing
their demeanor on the witness stand, is better situated to make conclusions of facts. Thus, it has been the
standing practice of appellate courts to accord lower court's judgments the presumption of correctness.
And unless it can be shown that error or errors, substantial in character, be shown in the conclusion
arrived at, or that there was abuse in judicial scrutiny, We are bound by their judgments. On this ground
2
alone We can rest the affirmance of the judgment appealed from.
2. Nor is the result different even if no such presumption were indulged in, that is, even if We were to
resolve whether or not there exist compelling reasons for an ultimate reversal.
The judicial pronouncement below that the gross negligence of defendant-appellant was the proximate
cause of the collision has been thoroughly reviewed by this Court and we fully affirm the same.
3

Negligence has been defined by Judge Cooley in his work on Torts 3d ed sec. 1324 as "the failure to
observe for the protection of the interests of another person that degree of care, precaution, and vigilance
which the circumstances justly demand, whereby such other person suffers injury." By such a test, it can
readily be seen that there is no hard and fast rule whereby such degree of care and vigilance is
measured, it is dependent upon the circumstances in which a person finds himself so situated. All that the
law requires is that it is always incumbent upon a person to use that care and diligence expected of
reasonable men under similar circumstances.
These are the circumstances attendant to the collision. Undisputably, the warning devices installed at the
railroad crossing were manually operated; there were only 2 shifts of guards provided for the operation
thereof one, the 7:00 A.M. to 3:00 P. M. shift, and the other, the 3:00 P.M. to 11:00 P.M. shift. On the
night of the accident, the train for Lucena was on an unscheduled trip after 11:00 P.M. During that precise
hour, the warning devices were not operating for no one attended to them. Also, as observed by the lower
court, the locomotive driver did not blow his whistle, thus: "... he simply sped on without taking an extra
precaution of blowing his whistle from a distance of 50 to 10 meters from the crossing. That the train was
running at full speed is attested to by the fact that notwithstanding the application of the emergency
brakes, the train did not stop until it reached a distance of around 100 meters."
These facts assessed together show the inadequacy, nay, the absence, of precautions taken by the
defendant-appellant to warn the travelling public of the impending danger. It is clear to Us that as the
signal devices were wholly manually-operated, there was an urgent need for a flagman or guard to man
the crossing at all times. As it was, the crossing was left unattended to after eleven o'clock every night

and on the night of the accident. We cannot in all reason justify or condone the act of the defendantappellant allowing the subject locomotive to travel through the unattended crossing with inoperative signal
devices, but without sending any of its employees to operate said signal devices so as to warn oncoming
motorists of the approach of one of its locomotives. It is not surprising therefore that the in operation of
the warning devices created a situation which was misunderstood by the riding public to mean safe
passage. Jurisprudence recognizes that if warning devices are installed in railroad crossings, the
travelling public has the right to rely on such warning devices to put them on their guard and take the
necessary precautions before crossing the tracks. A need, therefore, exists for the railroad company to
use reasonable care to keep such devices in good condition and in working order, or to give notice that
4
they are not operating, since if such a signal is misunderstood it is a menace. Thus, it has been held that
if a railroad company maintains a signalling device at a crossing to give warning of the approach of a
train, the failure of the device to operate is generally held to be evidence of negligence, which maybe
considered with all the circumstances of the case in determining whether the railroad company was
5
negligent as a matter of fact.
The set of circumstances surrounding the collision subject of this case is very much similar to that of Lilius
v. Manila Railroad Company, 59 Phil. 758 (1934), where this Court upheld the lower court's finding of
negligence on the part of defendant locomotive company upon the following facts
... on the part of the defendant company, for not having had on that occasion any
semaphore at the crossing at Dayap to serve as a warning to passersby of its existence
in order that they might take the necessary precautions before crossing the railroad; and,
on the part of its employees the flagman and switchman, for not having remained at
his post at the crossing in question to warn passersby of the approaching train; the
station master, for failure to send the said flagman and switchman to his post on time;
and the engineer, for not having taken the necessary precautions to avoid an accident, in
view of the absence of said flagman and switchman, by slackening his speed and
continuously ringing the bell and blowing the whistle before arriving at the crossing.
Defendant-appellant rests its defense mainly on Section 56(a) of the Motor Vehicle Law. Thus:
Section 56(a) Traversing through streets and railroad crossing, etc, All vehicles
moving on the public highways shall be brought to a full stop before traversing any
'through street' or railroad crossing. Whenever any such 'through street' or crossing is so
designated and signposted, it shall be unlawful for the driver of any vehicle to fail to stop
within twenty meters but not less than two and one-half meters from such through street
or railroad crossing.
The defense presupposes that the failure of plaintiffs-appellees to stop before proceeding to traverse the
crossing constitutes contributory negligence, thereby precluding them from recovering indemnity for their
injuries and damages.
The candor of defendant-appellant in interposing such a defense is doubtful. As seemingly observed by
the lower court, the defense, through inadvertence or deliberateness, did not pursue further the excepting
clause of the same section thus to go on:
Provided, however, that the driver of a passenger automobile or motorcycle may instead
of coming to a full stop, slow down to not more than ten kilometers per hour whenever it
is apparent that no hazard exists.
After a thorough perusal of the facts attendant to the case, this Court is in fun accord with the lower court.
Plaintiff-appellee Victorino Cusi had exercised all the necessary precautions required of him as to avoid
injury to -himself and to others. We find no need for him to have made a full stop; relying on his faculties
of sight and hearing, Victorino Cusi had no reason to anticipate the impending danger. The record shows

that the spouses Cusi previously knew of the existence of the railroad crossing, having stopped at the
guardhouse to ask for directions before proceeding to the party. At the crossing, they found the level bar
raised, no warning lights flashing nor warning bells ringing, nor whistle from an oncoming train. They
safely traversed the crossing. On their return home, the situation at the crossing did not in the least
change, except for the absence of the guard or flagman. Hence, on the same impression that the
crossing was safe for passage as before, plaintiff-appellee Victorino Cusi merely slackened his speed and
proceeded to cross the tracks, driving at the proper rate of speed for going over railroad crossings. Had
defendant-appellant been successful in establishing that its locomotive driver blew his whistle to warn
motorists of his approach to compensate for the absence of the warning signals, and that Victorino Cusi,
instead of stopping or slackening his speed, proceeded with reckless speed and regardless of possible or
threatened danger, then We would have been put in doubt as to the degree of prudence exercised by him
6
and would have, in all probability, declared him negligent. But as the contrary was established, we
remain convinced that Victorino Cusi had not, through his own negligence, contributed to the accident so
as to deny him damages from the defendant-appellant.
The only question that now remains to be resolved is the reasonableness of the amount awarded as
damages to the plaintiffs- appellees.
The following actual expenses and losses are fully substantiated:
(a) Hospital bills of Mrs. Cusi from October, 1963 to May, 1964 in the amount of Thirteen
Thousand Five Hundred Fifty Pesos and Five Centavos (P13,550.05);
(b) Another hospital bill of Mrs. Cusi in 1965 in the amount of Three Thousand and One
Pesos and Ninety Centavos (P3,001.90);
(c) Doctor's fees for two surgical operations performed on Mrs. Cusi by one Dr. Manuel
Rivera in the amount of One Thousand and Five Hundred Pesos (Pl,500.00);
(d) Loss of Victorino's wrist watch valued at Two Hundred and Fifty Pesos (P250.00);
(e) Loss of Pilar's half of her pair of demand earrings(l-carrats) valued at Two Thousand
Seven Hundred and Fifty Pesos (P2,750,00);
(f) Repair of the damaged Vauxhall car in the amount of Two Thousand Eight Hundred
and Ninety Four Pesos and Seventy- Seven Centavos (P2,894.77).
The total award of actual damages in the amount of Twenty Three Thousand Nine Hundred Forty-Six
Pesos and Seventy-Two Centavos (P23,946.72) is, therefore, correct.
The lower court awarded Twenty-One Thousand Six Hundred Pesos (P21,600.00) to Mrs. Cusi for loss of
income for the three years that she was under constant medical treatment, and Fourteen Thousand
Pesos (P14,000.00) for impairment of her earning capacity; and Forty Thousand Pesos (P 40,000.00) to
Mr. Cusi for loss of income for the eight months that he was disabled and impairment of his earning
capacity. We find the award reasonable. The records show that Mrs. Cusi, previously a skilled piano
teacher averaging a monthly income of Six Hundred Pesos (P600.00), cannot now teach nor play the
piano since the accident which resulted in the loss of the dexterity of her fingers; likewise, Mr. Cusi cannot
now vigorously attend to his businesses which previously netted him a monthly average income of Five
Thousand Pesos (P5,000.00).
As regards the award of Twenty Thousand Pesos (P20,000.00) for profits which Victorino Cusi failed to
realize from a certain real estate transaction with the Dolor Lopez Enterprises, we affirm the same as the

defendant-appellant has failed to present an iota of evidence to overcome plaintiffs-appellees' evidence

credited by the lower court as to the certainty of the materialization of the stated transaction.
The award of Seventy Thousand Pesos (P70,000.00) to Mrs. Cusi and Fifty Thousand Pesos
(P50,000.00) to Victorino Cusi as moral damages is not excessive. In their own respective fields of
endeavor, both were successful. Now they have to bear throughout their whole lifetime the humiliation
wrought by their physical deformities which no doubt affected, and will continue to do so, their social lives,
their financial undertakings, and even their mental attitudes.
Likewise, the amount of Ten Thousand Pesos (P10,000.00) given as attorney's fees and expenses of
litigation is not unreasonable. The total amount of damages awarded by the trial court should bear legal
interest at 6% from the rendition of the j judgment, which was on March 26, 1968.
WHEREFORE, the judgment of the lower court is hereby AFFIRMED with the modification that the total
amount of damages shall bear legal interest at six per cent (6%) from the rendition of the decision dated
March 26, 1968.
SO ORDERED.
Teehankee, (Chairman), Makasiar, Fernandez, De Castro, and Melencio-Herrera, JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 129792 December 21, 1999

JARCO MARKETING CORPORATION, LEONARDO KONG, JOSE TIOPE and ELISA PANELO,
petitioners,
vs.
HONORABLE COURT OF APPEALS, CONRADO C. AGUILAR and CRISELDA R. AGUILAR,
respondents.

DAVIDE, JR., J.:

In this petition for review on certiorari under Rule 45 of the Rules of Court, petitioners seek the reversal of
1
2
the 17 June 1996 decision of the Court of Appeals in C.A. G.R. No. CV 37937 and the resolution
denying their motion for reconsideration. The assailed decision set aside the 15 January 1992 judgment
of the Regional Trial Court (RTC), Makati City, Branch 60 in Civil Case No. 7119 and ordered petitioners
to pay damages and attorney's fees to private respondents Conrado and Criselda (CRISELDA) Aguilar.
Petitioner Jarco Marketing Corporation is the owner of Syvel's Department Store, Makati City. Petitioners
Leonardo Kong, Jose Tiope and Elisa Panelo are the store's branch manager, operations manager, and
supervisor, respectively. Private respondents are spouses and the parents of Zhieneth Aguilar
(ZHIENETH).

In the afternoon of 9 May 1983, CRISELDA and ZHIENETH were at the 2nd floor of Syvel's Department
Store, Makati City. CRISELDA was signing her credit card slip at the payment and verification counter
when she felt a sudden gust of wind and heard a loud thud. She looked behind her. She then beheld her
daughter ZHIENETH on the floor, her young body pinned by the bulk of the store's gift-wrapping
counter/structure. ZHIENETH was crying and screaming for help. Although shocked, CRISELDA was
quick to ask the assistance of the people around in lifting the counter and retrieving ZHIENETH from the
3
floor.
ZHIENETH was quickly rushed to the Makati Medical Center where she was operated on. The next day
ZHIENETH lost her speech and thereafter communicated with CRISELDA by writing on a magic slate.
The injuries she sustained took their toil on her young body. She died fourteen (14) days after the
4
accident or on 22 May 1983, on the hospital bed. She was six years old.
The cause of her death was attributed to the injuries she sustained. The provisional medical certificate
issued by ZHIENETH's attending doctor described the extent of her injuries:

Diagnoses:
1. Shock, severe, sec. to intra-abdominal injuries due to
blunt injury
2. Hemorrhage, massive, intraperitoneal sec. to
laceration, (L) lobe liver
3. Rupture, stomach, anterior & posterior walls
4. Complete transection, 4th position, duodenum
5. Hematoma, extensive, retroperitoneal
6. Contusion, lungs, severe
CRITICAL
After the burial of their daughter, private respondents demanded upon petitioners the reimbursement of
6
the hospitalization, medical bills and wake and funeral expenses which they had incurred. Petitioners
refused to pay. Consequently, private respondents filed a complaint for damages, docketed as Civil Case
No. 7119 wherein they sought the payment of P157,522.86 for actual damages, P300,000 for moral
damages, P20,000 for attorney's fees and an unspecified amount for loss of income and exemplary
damages.
In their answer with counterclaim, petitioners denied any liability for the injuries and consequent death of
ZHIENETH. They claimed that CRISELDA was negligent in exercising care and diligence over her
daughter by allowing her to freely roam around in a store filled with glassware and appliances.
ZHIENETH too, was guilty of contributory negligence since she climbed the counter, triggering its
eventual collapse on her. Petitioners also emphasized that the counter was made of sturdy wood with a
strong support; it never fell nor collapsed for the past fifteen years since its construction.
Additionally, petitioner Jarco Marketing Corporation maintained that it observed the diligence of a good
father of a family in the selection, supervision and control of its employees. The other petitioners likewise
raised due care and diligence in the performance of their duties and countered that the complaint was
malicious for which they suffered besmirched reputation and mental anguish. They sought the dismissal
of the complaint and an award of moral and exemplary damages and attorney's fees in their favor.

In its decision the trial court dismissed the complaint and counterclaim after finding that the
preponderance of the evidence favored petitioners. It ruled that the proximate cause of the fall of the
counter on ZHIENETH was her act of clinging to it. It believed petitioners' witnesses who testified that
ZHIENETH clung to the counter, afterwhich the structure and the girl fell with the structure falling on top of
her, pinning her stomach. In contrast, none of private respondents' witnesses testified on how the counter
fell. The trial court also held that CRISELDA's negligence contributed to ZHIENETH's accident.
In absolving petitioners from any liability, the trial court reasoned that the counter was situated at the end
or corner of the 2nd floor as a precautionary measure hence, it could not be considered as an attractive
8
nuisance. The counter was higher than ZHIENETH. It has been in existence for fifteen years. Its
structure was safe and well-balanced. ZHIENETH, therefore, had no business climbing on and clinging to
it.
Private respondents appealed the decision, attributing as errors of the trial court its findings that: (1) the
proximate cause of the fall of the counter was ZHIENETH's misbehavior; (2) CRISELDA was negligent in
her care of ZHIENETH; (3) petitioners were not negligent in the maintenance of the counter; and (4)
petitioners were not liable for the death of ZHIENETH.
Further, private respondents asserted that ZHIENETH should be entitled to the conclusive presumption
that a child below nine (9) years is incapable of contributory negligence. And even if ZHIENETH, at six (6)
years old, was already capable of contributory negligence, still it was physically impossible for her to have
propped herself on the counter. She had a small frame (four feet high and seventy pounds) and the
counter was much higher and heavier than she was. Also, the testimony of one of the store's former
employees, Gerardo Gonzales, who accompanied ZHIENETH when she was brought to the emergency
room of the Makati Medical Center belied petitioners' theory that ZHIENETH climbed the counter.
Gonzales claimed that when ZHIENETH was asked by the doctor what she did, ZHIENETH replied,
9
"[N]othing, I did not come near the counter and the counter just fell on me." Accordingly, Gonzales'
testimony on ZHIENETH's spontaneous declaration should not only be considered as part of res gestae
but also accorded credit.
Moreover, negligence could not be imputed to CRISELDA for it was reasonable for her to have let go of
ZHIENETH at the precise moment that she was signing the credit card slip.
Finally, private respondents vigorously maintained that the proximate cause of ZHIENETH's death, was
petitioners' negligence in failing to institute measures to have the counter permanently nailed.
On the other hand, petitioners argued that private respondents raised purely factual issues which could
no longer be disturbed. They explained that ZHIENETH's death while unfortunate and tragic, was an
accident for which neither CRISELDA nor even ZHIENETH could entirely be held faultless and blameless.
Further, petitioners adverted to the trial court's rejection of Gonzales' testimony as unworthy of credence.
As to private respondent's claim that the counter should have been nailed to the ground, petitioners
justified that it was not necessary. The counter had been in existence for several years without any prior
accident and was deliberately placed at a corner to avoid such accidents. Truth to tell, they acted without
10
fault or negligence for they had exercised due diligence on the matter. In fact, the criminal case for
homicide through simple negligence filed by private respondents against the individual petitioners was
dismissed; a verdict of acquittal was rendered in their favor.
The Court of Appeals, however, decided in favor of private respondents and reversed the appealed
judgment. It found that petitioners were negligent in maintaining a structurally dangerous counter. The
11
counter was shaped like an inverted "L" with a top wider than the base. It was top heavy and the weight
of the upper portion was neither evenly distributed nor supported by its narrow base. Thus, the counter
was defective, unstable and dangerous; a downward pressure on the overhanging portion or a push from
the front could cause the counter to fall. Two former employees of petitioners had already previously

brought to the attention of the management the danger the counter could cause. But the latter ignored
their concern. The Court of Appeals faulted the petitioners for this omission, and concluded that the
incident that befell ZHIENETH could have been avoided had petitioners repaired the defective counter. It
was inconsequential that the counter had been in use for some time without a prior incident.
The Court of Appeals declared that ZHIENETH, who was below seven (7) years old at the time of the
incident, was absolutely incapable of negligence or other tort. It reasoned that since a child under nine (9)
years could not be held liable even for an intentional wrong, then the six-year old ZHIENETH could not be
made to account for a mere mischief or reckless act. It also absolved CRISELDA of any negligence,
finding nothing wrong or out of the ordinary in momentarily allowing ZHIENETH to walk while she signed
the document at the nearby counter.
The Court of Appeals also rejected the testimonies of the witnesses of petitioners. It found them biased
and prejudiced. It instead gave credit to the testimony of disinterested witness Gonzales. The Court of
Appeals then awarded P99,420.86 as actual damages, the amount representing the hospitalization
12
expenses incurred by private respondents as evidenced by the hospital's statement of account. It
denied an award for funeral expenses for lack of proof to substantiate the same. Instead, a compensatory
damage of P50,000 was awarded for the death of ZHIENETH.
We quote the dispositive portion of the assailed decision,

13

thus:

WHEREFORE, premises considered, the judgment of the lower court is SET ASIDE and
another one is entered against [petitioners], ordering them to pay jointly and severally
unto [private respondents] the following:
1. P50,000.00 by way of compensatory damages for the
death of Zhieneth Aguilar, with legal interest (6% p.a.)
from 27 April 1984;
2. P99,420.86 as reimbursement for hospitalization
expenses incurred; with legal interest (6% p.a.) from 27
April 1984;
3. P100,000.00 as moral and exemplary damages;
4. P20,000.00 in the concept of attorney's fees; and
5. Costs.
Private respondents sought a reconsideration of the decision but the same was denied in the Court of
14
Appeals' resolution of 16 July 1997.
Petitioners now seek the reversal of the Court of Appeals' decision and the reinstatement of the judgment
of the trial court. Petitioners primarily argue that the Court of Appeals erred in disregarding the factual
findings and conclusions of the trial court. They stress that since the action was based on tort, any finding
of negligence on the part of the private respondents would necessarily negate their claim for damages,
where said negligence was the proximate cause of the injury sustained. The injury in the instant case was
the death of ZHIENETH. The proximate cause was ZHIENETH's act of clinging to the counter. This act in
turn caused the counter to fall on her. This and CRISELDA's contributory negligence, through her failure
to provide the proper care and attention to her child while inside the store, nullified private respondents'
claim for damages. It is also for these reasons that parents are made accountable for the damage or
injury inflicted on others by their minor children. Under these circumstances, petitioners could not be held
responsible for the accident that befell ZHIENETH.

Petitioners also assail the credibility of Gonzales who was already separated from Syvel's at the time he
testified; hence, his testimony might have been tarnished by ill-feelings against them.
For their part, private respondents principally reiterated their arguments that neither ZHIENETH nor
CRISELDA was negligent at any time while inside the store; the findings and conclusions of the Court of
Appeals are substantiated by the evidence on record; the testimony of Gonzales, who heard ZHIENETH
comment on the incident while she was in the hospital's emergency room should receive credence; and
finally, ZHIENETH's part of the res gestae declaration "that she did nothing to cause the heavy structure
to fall on her" should be considered as the correct version of the gruesome events.
We deny the petition.
The two issues to be resolved are: (1) whether the death of ZHIENETH was accidental or attributable to
negligence; and (2) in case of a finding of negligence, whether the same was attributable to private
respondents for maintaining a defective counter or to CRISELDA and ZHIENETH for failing to exercise
due and reasonable care while inside the store premises.
15

An accident pertains to an unforeseen event in which no fault or negligence attaches to the defendant.
It is "a fortuitous circumstance, event or happening; an event happening without any human agency, or if
happening wholly or partly through human agency, an event which under the circumstances is unusual or
16
unexpected by the person to whom it happens."
On the other hand, negligence is the omission to do something which a reasonable man, guided by those
considerations which ordinarily regulate the conduct of human affairs, would do, or the doing of
17
something which a prudent and reasonable man would not do. Negligence is "the failure to observe, for
the protection of the interest of another person, that degree of care, precaution and vigilance which the
18
circumstances justly demand, whereby such other person suffers injury."
Accident and negligence are intrinsically contradictory; one cannot exist with the other. Accident occurs
when the person concerned is exercising ordinary care, which is not caused by fault of any person and
19
which could not have been prevented by any means suggested by common prudence.
The test in determining the existence of negligence is enunciated in the landmark case of Plicart v. Smith,
20
thus: Did the defendant in doing the alleged negligent act use that reasonable care and caution which
an ordinarily prudent person would have used in the same situation? If not, then he is guilty of negligence.
21

We rule that the tragedy which befell ZHIENETH was no accident and that ZHIENETH's death could only
be attributed to negligence.
We quote the testimony of Gerardo Gonzales who was at the scene of the incident and accompanied
CRISELDA and ZHIENETH to the hospital:
Q While at the Makati Medical Center, did you hear or notice anything
while the child was being treated?
A At the emergency room we were all surrounding the child. And when
the doctor asked the child "what did you do," the child said "nothing, I did
not come near the counter and the counter just fell on me."
Q (COURT TO ATTY. BELTRAN)
You want the words in Tagalog to be translated?

ATTY. BELTRAN
Yes, your Honor.
COURT
Granted. Intercalate "wala po, hindi po ako lumapit doon. Basta
bumagsak." 22
This testimony of Gonzales pertaining to ZHIENETH's statement formed (and should be admitted as) part
of the res gestae under Section 42, Rule 130 of the Rules of Court, thus:
Part of res gestae. Statements made by a person while a startling occurrence is taking
place or immediately prior or subsequent thereto with respect to the circumstances
thereof, may be given in evidence as part of the res gestae. So, also, statements
accompanying an equivocal act material to the issue, and giving it a legal significance,
may be received as part of the res gestae.
It is axiomatic that matters relating to declarations of pain or suffering and statements made to a
23
physician are generally considered declarations and admissions. All that is required for their
admissibility as part of the res gestae is that they be made or uttered under the influence of a startling
event before the declarant had the time to think and concoct a falsehood as witnessed by the person who
testified in court. Under the circumstances thus described, it is unthinkable for ZHIENETH, a child of such
tender age and in extreme pain, to have lied to a doctor whom she trusted with her life. We therefore
accord credence to Gonzales' testimony on the matter, i.e., ZHIENETH performed no act that facilitated
her tragic death. Sadly, petitioners did, through their negligence or omission to secure or make stable the
counter's base.
Gonzales' earlier testimony on petitioners' insistence to keep and maintain the structurally unstable giftwrapping counter proved their negligence, thus:
Q When you assumed the position as gift wrapper at the second floor,
will you please describe the gift wrapping counter, were you able to
examine?
A Because every morning before I start working I used to clean that
counter and since not nailed and it was only standing on the floor, it was
shaky.
xxx xxx xxx
Q Will you please describe the counter at 5:00 o'clock [sic] in the
afternoon on [sic] May 9 1983?
A At that hour on May 9, 1983, that counter was standing beside the
verification counter. And since the top of it was heavy and considering
that it was not nailed, it can collapse at anytime, since the top is heavy.
xxx xxx xxx
Q And what did you do?

A I informed Mr. Maat about that counter which is [sic] shaky and since
Mr. Maat is fond of putting display decorations on tables, he even told
me that I would put some decorations. But since I told him that it not [sic]
nailed and it is shaky he told me "better inform also the company about
it." And since the company did not do anything about the counter, so I
24
also did not do anything about the counter. [Emphasis supplied]
Ramon Guevarra, another former employee, corroborated the testimony of Gonzales, thus:
Q Will you please described [sic] to the honorable Court the counter
where you were assigned in January 1983?
xxx xxx xxx
A That counter assigned to me was when my supervisor ordered me to
carry that counter to another place. I told him that the counter needs
nailing and it has to be nailed because it might cause injury or accident
to another since it was shaky.
Q When that gift wrapping counter was transferred at the second floor on
February 12, 1983, will you please describe that to the honorable Court?
A I told her that the counter wrapper [sic] is really in good [sic] condition;
it was shaky. I told her that we had to nail it.
Q When you said she, to whom are you referring to [sic]?
A I am referring to Ms. Panelo, sir.
Q And what was the answer of Ms. Panelo when you told her that the
counter was shaky?
A She told me "Why do you have to teach me. You are only my
subordinate and you are to teach me?" And she even got angry at me
when I told her that.
xxx xxx xxx
Q From February 12, 1983 up to May 9, 1983, what if any, did Ms.
Panelo or any employee of the management do to that (sic)
xxx xxx xxx
Witness:
None, sir. They never nailed the counter. They only nailed the counter
25
after the accident happened. [Emphasis supplied]
Without doubt, petitioner Panelo and another store supervisor were personally informed of the danger
posed by the unstable counter. Yet, neither initiated any concrete action to remedy the situation nor
ensure the safety of the store's employees and patrons as a reasonable and ordinary prudent man would

have done. Thus, as confronted by the situation petitioners miserably failed to discharge the due diligence
required of a good father of a family.
On the issue of the credibility of Gonzales and Guevarra, petitioners failed to establish that the former's
testimonies were biased and tainted with partiality. Therefore, the allegation that Gonzales and
Guevarra's testimonies were blemished by "ill feelings" against petitioners since they (Gonzales and
Guevarra) were already separated from the company at the time their testimonies were offered in court
was but mere speculation and deserved scant consideration.
It is settled that when the issue concerns the credibility of witnesses, the appellate courts will not as a
general rule disturb the findings of the trial court, which is in a better position to determine the same. The
trial court has the distinct advantage of actually hearing the testimony of and observing the deportment of
26
the witnesses. However, the rule admits of exceptions such as when its evaluation was reached
arbitrarily or it overlooked or failed to appreciate some facts or circumstances of weight and substance
27
which could affect the result of the case. In the instant case, petitioners failed to bring their claim within
the exception.
Anent the negligence imputed to ZHIENETH, we apply the conclusive presumption that favors children
28
below nine (9) years old in that they are incapable of contributory negligence. In his book, former Judge
Cezar S. Sangco stated:
In our jurisdiction, a person under nine years of age is conclusively presumed to have
acted without discernment, and is, on that account, exempt from criminal liability. The
same presumption and a like exemption from criminal liability obtains in a case of a
person over nine and under fifteen years of age, unless it is shown that he has acted with
discernment. Since negligence may be a felony and a quasi-delict and required
discernment as a condition of liability, either criminal or civil, a child under nine years of
age is, by analogy, conclusively presumed to be incapable of negligence; and that the
presumption of lack of discernment or incapacity for negligence in the case of a child over
nine but under fifteen years of age is a rebuttable one, under our law. The rule, therefore,
is that a child under nine years of age must be conclusively presumed incapable of
contributory negligence as a matter of law. [Emphasis supplied]
Even if we attribute contributory negligence to ZHIENETH and assume that she climbed over the counter,
no injury should have occurred if we accept petitioners' theory that the counter was stable and sturdy. For
if that was the truth, a frail six-year old could not have caused the counter to collapse. The physical
29
analysis of the counter by both the trial court and Court of Appeals and a scrutiny of the evidence on
record reveal otherwise, i.e., it was not durable after all. Shaped like an inverted "L," the counter was
heavy, huge, and its top laden with formica. It protruded towards the customer waiting area and its base
30
was not secured.
CRISELDA too, should be absolved from any contributory negligence. Initially, ZHIENETH held on to
31
CRISELDA's waist, later to the latter's hand. CRISELDA momentarily released the child's hand from
her clutch when she signed her credit card slip. At this precise moment, it was reasonable and usual for
CRISELDA to let go of her child. Further, at the time ZHIENETH was pinned down by the counter, she
was just a foot away from her mother; and the gift-wrapping counter was just four meters away from
32
CRISELDA. The time and distance were both significant. ZHIENETH was near her mother and did not
loiter as petitioners would want to impress upon us. She even admitted to the doctor who treated her at
the hospital that she did not do anything; the counter just fell on her.
WHEREFORE, in view of all the foregoing, the instant petition is DENIED and the challenged decision of
the Court of Appeals of 17 June 1996 in C.A. G.R. No. CV 37937 is hereby AFFIRMED.
Costs against petitioners.

SO ORDERED.
Puno, Kapunan, Pardo and Ynares-Santiago, JJ., concur.
Republic of the Philippines
SUPREME COURT
FIRST DIVISION
G.R. No. 150920 November 25, 2005
CHILD LEARNING CENTER, INC. and SPOUSES EDGARDO L. LIMON and SYLVIA S. LIMON,
Petitioners,
vs.
TIMOTHY TAGARIO, assisted by his parents BASILIO TAGORIO and HERMINIA TAGORIO,
Respondents.
DECISION
AZCUNA, J.:
This petition started with a tort case filed with the Regional Trial Court of Makati by Timothy Tagorio and
his parents, Basilio R. Tagorio and Herminia Tagorio, docketed as Civil Case No. 91-1389. The
1
complaint alleged that during the school year 1990-1991, Timothy was a Grade IV student at Marymount
School, an academic institution operated and maintained by Child Learning Center, Inc. (CLC). In the
afternoon of March 5, 1991, between 1 and 2 p.m., Timothy entered the boys comfort room at the third
floor of the Marymount building to answer the call of nature. He, however, found himself locked inside and
unable to get out. Timothy started to panic and so he banged and kicked the door and yelled several
times for help. When no help arrived he decided to open the window to call for help. In the process of
opening the window, Timothy went right through and fell down three stories. Timothy was hospitalized
and given medical treatment for serious multiple physical injuries.
An action under Article 2176 of the Civil Code was filed by respondents against the CLC, the members of
its Board of Directors, namely Spouses Edgardo and Sylvia Limon, Alfonso Cruz, Carmelo Narciso and
2
Luningning Salvador, and the Administrative Officer of Marymount School, Ricardo Pilao. In its defense,
CLC maintained that there was nothing defective about the locking mechanism of the door and that the
fall of Timothy was not due to its fault or negligence. CLC further maintained that it had exercised the due
care and diligence of a good father of a family to ensure the safety, well-being and convenience of its
students.
After trial, the court a quo found in favor of respondents and ordered petitioners CLC and Spouses Limon
to pay respondents, jointly and severally, P200,253.12 as actual and compensatory damages, P200,000
as moral damages, P50,000 as exemplary damages, P100,000 as attorneys fees and the costs of the
suit. The trial court disregarded the corporate fiction of CLC and held the Spouses Limon personally liable
because they were the ones who actually managed the affairs of the CLC.
Petitioners CLC and the Spouses Limon appealed the decision to the Court of Appeals.
3

On September 28, 2001, the Court of Appeals affirmed the decision in toto. Petitioners elevated the case
to this Court under Rule 45 of the Rules of Court, after their motion for reconsideration was denied by
4
Resolution of November 23, 2001.

Petitioners question several factual findings of the trial court, which were affirmed by the Court of
5
Appeals, namely:
1. That respondent was allegedly trapped inside the boys comfort room located at the third floor of the
school building on March 5, 1991;
2. That respondent allegedly banged and kicked the door of said comfort room several times to attract
attention and that he allegedly yelled thereat for help which never came;
3. That respondent was allegedly forced to open the window of said comfort room to seek help;
4. That the lock set installed at the boys comfort room located in the third floor of the school building on
March 5, 1991 was allegedly defective and that the same lock set was involved in previous incidents of
alleged malfunctioning;
5. That petitioner Child Learning Center, Inc. allegedly failed to install iron grills in the window of the boys
comfort room at the third floor of the school building;
6. That petitioner Child Learning Center, Inc. allegedly failed to exercise the due care of a good father of a
family in the selection and supervision of its employees;
7. That the proximate cause of respondents accident was allegedly not due to his own contributory
negligence;
8. That there was an alleged basis to apply the legal principle of "piercing the veil of corporate entity" in
resolving the issue of alleged liability of petitioners Edgardo L. Limon and Sylvia S. Limon;
9. That there was alleged basis for petitioners to pay respondent actual, moral and exemplary damages,
plus attorneys fees;
10. That there was an alleged basis in not awarding petitioners prayer for moral and exemplary
damages, including attorneys fees.
Generally, factual findings of the trial court, affirmed by the Court of Appeals, are final and conclusive and
may not be reviewed on appeal. The established exceptions are: (1) when the inference made is
manifestly mistaken, absurd or impossible; (2) when there is grave abuse of discretion; (3) when the
findings are grounded entirely on speculations, surmises or conjectures; (4) when the judgment of the
Court of Appeals is based on misapprehension of facts; (5) when the findings of fact are conflicting; (6)
when the Court of Appeals, in making its findings, went beyond the issues of the case and the same is
contrary to the admissions of both appellant and appellee; (7) when the findings of fact are conclusions
without citation of specific evidence on which they are based; (8) when the Court of Appeals manifestly
overlooked certain relevant facts not disputed by the parties and which, if properly considered, would
justify a different conclusion; and (9) when the findings of fact of the Court of Appeals are premised on the
6
absence of evidence and are contradicted by the evidence on record.
On the basis of the records of this case, this Court finds no justification to reverse the factual findings and
consider this case as an exception to the general rule.
In every tort case filed under Article 2176 of the Civil Code, plaintiff has to prove by a preponderance of
evidence: (1) the damages suffered by the plaintiff; (2) the fault or negligence of the defendant or some
other person for whose act he must respond; and (3) the connection of cause and effect between the fault
7
or negligence and the damages incurred.

Fault, in general, signifies a voluntary act or omission which causes damage to the right of another giving
rise to an obligation on the part of the actor to repair such damage. Negligence is the failure to observe
for the protection of the interest of another person that degree of care, precaution and vigilance which the
circumstances justly demand. Fault requires the execution of a positive act which causes damage to
8
another while negligence consists of the omission to do acts which result in damage to another.
In this tort case, respondents contend that CLC failed to provide precautionary measures to avoid harm
and injury to its students in two instances: (1) failure to fix a defective door knob despite having been
notified of the problem; and (2) failure to install safety grills on the window where Timothy fell from.
The trial court found that the lock was defective on March 5, 1991:

The door knob was defective. After the incident of March 5, 1991, said door knob was taken off the door
of the toilet where Timothy was in. The architect who testified during the trial declared that although there
were standard specifications for door knobs for comfort room[s], and he designed them according to that
requirement, he did not investigate whether the door knob specified in his plans during the construction
[was] actually put in place. This is so because he did not verify whether the door knob he specified w[as]
actually put in place at the particular comfort room where Timothy was barred from getting outside. (TSN,
pp. 19-20, December 8, 1994).
The Court of Appeals held that there was no reason to disturb the factual assessment:

10

After having perused the records, We fail to see any indication of whim or arbitrariness on the part of the
trial magistrate in his assessment of the facts of the case. That said, We deem it not to be within Our
business to recast the factual conclusions reached by the court below.
Petitioners would make much of the point that no direct evidence was presented to prove that the door
knob was indeed defective on the date in question.
The fact, however, that Timothy fell out through the window shows that the door could not be opened
from the inside. That sufficiently points to the fact that something was wrong with the door, if not the door
knob, under the principle of res ipsa loquitor. The doctrine of res ipsa loquitor applies where (1) the
accident was of such character as to warrant an inference that it would not have happened except for the
defendants negligence; (2) the accident must have been caused by an agency or instrumentality within
the exclusive management or control of the person charged with the negligence complained of; and (3)
the accident must not have been due to any voluntary action or contribution on the part of the person
11
injured. Petitioners are clearly answerable for failure to see to it that the doors of their school toilets are
at all times in working condition. The fact that a student had to go through the window, instead of the
door, shows that something was wrong with the door.
As to the absence of grills on the window, petitioners contend that there was no such requirement under
the Building Code. Nevertheless, the fact is that such window, as petitioners themselves point out, was
approximately 1.5 meters from the floor, so that it was within reach of a student who finds the regular exit,
the door, not functioning. Petitioners, with the due diligence of a good father of the family, should have
anticipated that a student, locked in the toilet by a non-working door, would attempt to use the window to
call for help or even to get out. Considering all the circumstances, therefore, there is sufficient basis to
sustain a finding of liability on petitioners part.
Petitioners argument that CLC exercised the due diligence of a good father of a family in the selection
and supervision of its employees is not decisive. Due diligence in the selection and supervision of
employees is applicable where the employer is being held responsible for the acts or omissions of others
12
under Article 2180 of the Civil Code. In this case, CLCs liability is under Article 2176 of the Civil Code,
premised on the fact of its own negligence in not ensuring that all its doors are properly maintained.

Our pronouncement that Timothy climbed out of the window because he could not get out using the door,
negates petitioners other contention that the proximate cause of the accident was Timothys own
negligence. The injuries he sustained from the fall were the product of a natural and continuous
sequence, unbroken by any intervening cause, that originated from CLCs own negligence.
We, however, agree with petitioners that there was no basis to pierce CLCs separate corporate
personality. To disregard the corporate existence, the plaintiff must prove: (1) Control by the individual
owners, not mere majority or complete stock ownership, resulting in complete domination not only of
finances but of policy and business practice in respect to a transaction so that the corporate entity as to
this transaction had at the time no separate mind, will or existence of its own; (2) such control must have
been used by the defendant to commit fraud or wrong, to perpetuate the violation of a statutory or other
positive legal duty, or a dishonest and unjust act in contravention of the plaintiffs legal right; and (3) the
control and breach of duty must proximately cause the injury or unjust loss complained of. The absence
13
of these elements prevents piercing the corporate veil. The evidence on record fails to show that these
elements are present, especially given the fact that plaintiffs complaint had pleaded that CLC is a
corporation duly organized and existing under the laws of the Philippines.
On 9th and 10th points raised concerning the award of damages, the resolution would rest on factual
determinations by the trial court, affirmed by the Court of Appeals, and no legal issue warrants our
intervention.
WHEREFORE, the petition is partly granted and the Decision and Resolution of the Court of Appeals in
CA-G.R. CV No. 50961 dated September 28, 2001 and November 23, 2001, respectively, are MODIFIED
in that petitioners Spouses Edgardo and Sylvia Limon are absolved from personal liability. The Decision
and Resolution are AFFIRMED in all other respects. No pronouncement as to costs.
SO ORDERED.
ADOLFO S. AZCUNA
Associate Justice

c. Degree of Negligence
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 172406

October 11, 2007

CONCEPCION ILAO-ORETA, Petitioner,

vs.
SPOUSES EVA MARIE and BENEDICTO NOEL RONQUILLO, Respondents.
DECISION
CARPIO MORALES, J.:

Respondents, spouses Eva Marie Ronquillo (Eva Marie) and Noel Benedicto (Noel) Ronquillo (the
Ronquillo spouses or the spouses), had not been blessed with a child despite several years of marriage.
They thus consulted petitioner, Dr. Concepcion Ilao-Oreta (Dr. Ilao-Oreta), an obstetrician-gynecologistconsultant at the St. Lukes Medical Center where she was, at the time material to the case, the chief of
the Reproductive Endocrinology and Infertility Section.
Upon Dr. Ilao-Oretas advice, Eva Marie agreed to undergo a laparoscopic procedure whereby a
laparascope would be inserted through the patients abdominal wall to get a direct view of her internal
reproductive organ in order to determine the real cause of her infertility.
The procedure was scheduled on April 5, 1999 at 2:00 p.m., to be performed by Dr. Ilao-Oreta. At around
7:00 a.m. of said date, Eva Marie, accompanied by her husband Noel, checked in at the St. Lukes
Medical Center and underwent pre-operative procedures including the administration of intravenous fluid
and enema.
Dr. Ilao-Oreta did not arrive at the scheduled time for the procedure, however, and no prior notice of its
cancellation was received. It turned out that the doctor was on a return flight from Hawaii to, and arrived
at 10:00 p.m. of April 5, 1999 in, Manila.
1

On May 18, 1999, the Ronquillo spouses filed a complaint against Dr. Ilao-Oreta and the St. Lukes
Medical Center for breach of professional and service contract and for damages before the Regional Trial
Court (RTC) of Batangas City. They prayed for the award of actual damages including alleged loss of
income of Noel while accompanying his wife to the hospital, moral damages, exemplary damages, the
2
costs of litigation, attorneys fees, and other available reliefs and remedies.
3

In her Answer, Dr. Ilao-Oreta gave her side of the case as follows: She went on a honeymoon to Hawaii
and was scheduled to leave Hawaii at 3:00 p.m. of April 4, 1999 for Manila. Aware that her trip from
Hawaii to Manila would take about 12 hours, inclusive of a stop-over at the Narita Airport in Japan, she
estimated that she would arrive in Manila in the early morning of April 5, 1999. She thus believed in
utmost good faith that she would be back in Manila in time for the scheduled conduct of the laparoscopic
procedure. She failed to consider the time difference between Hawaii and the Philippines, however.
4

In its Answer, the St. Lukes Medical Center contended that the spouses have no cause of action against
it since it performed the pre-operative procedures without delay, and any cause of action they have would
be against Dr. Ilao-Oreta.
5

By Decision of March 9, 2001, Branch 84 of the Batangas RTC, finding that the failure of the doctor to
arrive on time was not intentional, awarded Eva Marie only actual damages in the total amount of P9,939
and costs of suit. It found no adequate proof that Noel had been deprived of any job contract while
attending to his wife in the hospital.
6

On appeal by the spouses, the Court of Appeals, by Decision of April 21, 2006, finding Dr. Ilao-Oreta
7
grossly negligent, modified the trial courts decision as follows:
WHEREFORE, the trial Courts decision dated March 9, 2001 is affirmed, subject to the modification that
the amount of actual damages, for which both defendants-appellees are jointly and severally liable to
plaintiffs-appellants, is increased to P16,069.40. Furthermore, defendant-appellee Dr. Ilao-Oreta is also
held liable to pay plaintiff-appellants the following:
(a) P50,000.00 as moral damages;
(b) P25,000.00 as exemplary damages; and

(c) P20,000.00 as attorneys fees.

8

SO ORDERED. (Underscoring supplied)

9

Hence, the present Petition for Review of Dr. Ilao-Oreta raising the following arguments:
The court a quo erred in finding petitioner to have acted with gross negligence and awarding moral
10
damages to respondents.
The court a quo erred in awarding Exemplary Damages to respondents.
The court a quo [erred] in awarding Attorneys Fees to respondents.

11

12

The court a quo erred in increasing the award of actual damages in favor of respondents.

13

"Gross negligence" implies a want or absence of or failure to exercise slight care or diligence, or the
entire absence of care. It evinces a thoughtless disregard of consequences without exerting any effort to
14
avoid them. It is characterized by want of even slight care, acting or omitting to act in a situation where
there is a duty to act, not inadvertently but willfully and intentionally with a conscious indifference to
15
consequences in so far as other persons may be affected.
The records show that before leaving for Hawaii, Dr. Ilao-Oreta left an admitting order with her secretary
for one of the spouses to pick up, apprised Eva Marie of the necessary preparations for the procedure,
16
and instructed the hospital staff to perform pre-operative treatments. These acts of the doctor reflect an
earnest intention to perform the procedure on the day and time scheduled.
The records also show that on realizing that she missed the scheduled procedure, Dr. Ilao-Oreta, upon
arrival in Manila, immediately sought to rectify the same, thus:
[ATTY SINJAN] Q: So, can you tell us the reason why you missed that operation?
[DR. ILAO-ORETA] A: When I scheduled her for the surgery, I looked at my ticket and so I was to leave
Hawaii on April 4 at around 4:00 oclock in the afternoon, so I was computing 12 hours of travel including
stop-over, then probably I would be in Manila early morning of April 5, then I have so much time and I can
easily do the case at 2:00 oclock, you know it skipped my mind the change in time.
Q: So when you arrived at 10:00 [PM] in Manila, what did you do?
A: I called immediately the hospital and I talked with the nurses, I asked about the patient, Mrs. Ronquillo,
and they told me that she has already left at around 7:00.
Q: And after calling the hospital, what happened?
A: I wanted to call the plaintiffs, but I didnt have their number at that time, so in the morning I went to my
office early at 8:00 and looked for her chart, because her telephone number was written in the chart. So, I
called them right away.
Q: Were you able to contact them?
A: I was able to reach Mr. Ronquillo.
Q: In the course of your conversation, what did you tell Mr. Ronquillo?

A: I apologized to him, I said I was sorry about the time that I missed the surgery, and I told him that I can
do the case right that same day without Mrs. Ronquillo having to undergo another [b]arium enema.
Q: What else did you tell him, if any?
A: I asked him whether I can talk with Mrs. Ronquillo because I wanted to apologize to her personally.
Q: And what did he say?
A: I could hear on the background that Mrs. Ronquillo was shouting angrily that she didnt want to talk to
me, and that she didnt want re-scheduling of the surgery . . .
ATTY LONTOK: May we move, your Honor, for the striking out of the answer, this is purely hearsay.
COURT: Remain on the record.
WITNESS [DR. ILAO-ORETA]: . . . and then Mr. Ronquillo told me "Im sorry, Dra., we cannot re17
schedule the surgery." (Underscoring supplied)
Noel admitted that indeed Dr. Ilao-Oreta called him up after she arrived in Manila as related by her.

18

The evidence then shows that Dr. Ilao-Oreta, who had traveled more than twice to the United States
where she obtained a fellowship in Reproductive Endocrinology and Infertility was indeed negligent when
she scheduled to perform professional service at 2:00 p.m. on April 5, 1999 without considering the time
difference between the Philippines and Hawaii.
The doctors act did not, however, reflect gross negligence as defined above. Her argument that
Although petitioner failed to take into consideration the time difference between the Philippines and
Hawaii, the situation then did not present any clear and apparent harm or injury that even a careless
person may perceive. Unlike in situations where the Supreme Court had found gross negligence to exist,
petitioner could not have been conscious of any foreseeable danger that may occur since she actually
believed that she would make it to the operation that was elective in nature, the only purpose of which
was to determine the real cause of infertility and not to treat and cure a life threatening disease. Thus, in
merely fixing the date of her appointment with respondent Eva Marie Ronquillo, petitioner was not in the
pursuit or performance of conduct which any ordinary person may deem to probably and naturally result
19
in injury, (Underscoring in original)
thus persuades.
It bears noting that when she was scheduling the date of her performance of the procedure, Dr. Ilao-Oreta
20
had just gotten married and was preparing for her honeymoon, and it is of common human knowledge
that excitement attends its preparations. Her negligence could then be partly attributed to human frailty
which rules out its characterization as gross.
The doctors negligence not being gross, the spouses are not entitled to recover moral damages.
Neither are the spouses entitled to recover exemplary damages in the absence of a showing that Dr. Ilao21
Oreta acted in a wanton, fraudulent, reckless, oppressive or malevolent manner, nor to award of
attorneys fees as, contrary to the finding of the Court of Appeals that the spouses "were compelled to
22
litigate and incur expenses to protect their interest," the records show that they did not exert enough
efforts to settle the matter before going to court. Eva Marie herself testified:

ATTY. SINJIAN:
Q: Isnt it true that before instituting this present case, you did not make any demand on Dr. IlaoOreta regarding the claims which you have allegedly incurred, because of the failed laparoscopic
surgery operation?
A [EVA MARIE]: I will tell the truth. Dr. Augusto Reyes of St. Lukes . . .
Q: But did you demand?
A: No, I did not demand because
ATTY. SINJIAN: That will be all, your Honor.
ATTY. LONTOK: The witness is still explaining.
WITNESS: Im explaining first. Dr. Augusto Reyes told me that he will hold the meeting for me
and Dr. Oreta to settle things and reimburse all the money that I spent from the hospital, and he
even suggested Dr. Oreta to personally talk to me.
ATTY. SINJIAN:
Q: So it was to Dr. Augusto Reyes that you talked?
A: Yes.
Q: But you did not demand anything or write to Dr. Oreta?
A: No.
Q: Before instituting this case?
23

A: No. (Underscoring supplied)

Finally, Dr. Ilao-Oretas prayer for the reduction of actual damages is well-taken. Article 2201 of the Civil
Code provides:
In contracts and quasi-contracts, the damages for which the obligor who acted in good faith is liable shall
be those which are the natural and probable consequences of the breach of the obligation, and which the
parties have foreseen or could have reasonably foreseen at the time the obligation was constituted.
In fixing the amount of actual damages, the Court of Appeals and the trial court included expenses which
24
the spouses incurred prior to April 5, 1999 when the breach of contract complained of occurred. The
Court of Appeals also included the alleged P300 spent on fuel consumption from the spouses residence
at San Pascual, Batangas to the St. Lukes Medical Center in Quezon City and the alleged P500 spent on
25
food in the hospital canteen, both of which are unsubstantiated by independent or competent proof. The
26
only piece of documentary evidence supporting the food and fuel expenses is an unsigned listing. As
the fuel and food expenses are not adequately substantiated, they cannot be included in the computation
27
of the amount of actual damages. So Premiere Development Bank v. Court of Appeals instructs:
In the instant case, the actual damages were proven through the sole testimony of Themistocles
Ruguero, the vice president for administration of Panacor. In his testimony, the witness affirmed that

Panacor incurred losses, specifically, in terms of training and seminars, leasehold acquisition,
procurement of vehicles and office equipment without, however, adducing receipts to substantiate the
same. The documentary evidence marked as Exhibit "W," which was an ordinary private writing allegedly
itemizing the capital expenditures and losses from the failed operation of Panacor, was not testified to by
any witness to ascertain the veracity of its content. Although the lower court fixed the sum of
P4,520,000.00 as the total expenditures incurred by Panacor, it failed to show how and in what manner
the same were substantiated by the claimant with reasonable certainty. Hence, the claim for actual
damages should be received with extreme caution since it is only based on bare assertion without
support from independent evidence. Premieres failure to prove actual expenditure consequently
conduces to a failure of its claim. In determining actual damages, the court cannot rely on mere
assertions, speculations, conjectures or guesswork but must depend on competent proof and on the best
28
evidence obtainable regarding the actual amount of loss. (Underscoring supplied)
The list of expenses cannot replace receipts when they should have been issued as a matter of course in
29
business transactions as in the case of purchase of gasoline and of food.1wphi1
The documented claim for hospital and medical expenses of the spouses is detailed in the Statement of
Account issued by the hospital, the pertinent entries of which read:
xxxx
GROSS HOSPITAL CHARGES 2,416.50
4/5/1999

1699460 DEPOSITOFFICIAL
RECEIPT

(5,000.00)
(5,000.00)

4/5/1999 SECOND 0284893 UNUSED MED

0439534
FLOOR
HINOX 500 MG CAP

(65.55)

SECOND 0284894 UNUSED MED

FLOOR
PHENERGAN 2 ML

(62.25)

50MG

0439893

________ (127.80)
30

BALANCE DUE

(2,711.30)
==========

As extrapolated from the above-quoted entries in the Statement of Account, P2,288.70 (the gross hospital
charges of P2,416.50 less the unused medicine in the amount of P127.80) was debited from the P5,000
31
deposit to thus leave a balance of the deposit in the amount of P2,711.30, which the trial court
erroneously denominated as "confinement fee." The remaining balance of P2,711.30 was the amount
refundable to the spouses.
32

Following Eastern Shipping Lines, Inc. v. Court of Appeals, this Court awards interest on the actual
damages to be paid by Dr. Ilao-Oreta at the rate of 6% per annum from the time of the filing of the
complaint on May 18, 1999, and at 12% per annum from the finality of this judgment until its satisfaction.
WHEREFORE, the petition is GRANTED. The decision appealed from is MODIFIED in that

1) the award to respondents-spouses Noel and Eva Marie Ronquillo of actual damages is
REDUCED to P2,288.70, to bear interest at a rate of 6% per annum from the time of the filing of
the complaint on May 18, 1999 and, upon finality of this judgment, at the rate of 12% per annum
until satisfaction; and
2) The award of moral and exemplary damages and attorneys fees is DELETED.
SO ORDERED.
CONCHITA CARPIO MORALES
Associate Justice
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-6870

May 24, 1954

ELENA AMEDO, plaintiff-appellant,

vs.
RIO Y OLABARRIETA, INC., defendant-appellee.
Cesareo Perez and Meliton C. Parducho for appellant.
M. Almario and Jose T. Lajom for appellee.
CONCEPCION, J.:
This case was instituted on October 18, 1950. In her original complaint, plaintiff Elena Amedo sought to
collect from defendant Rio y Olabarrieta, Inc., the sum of P2,038.40 as compensation for the death of her
son, Filomeno Managuit, who worked for the defendant as a seaman of the M/S Pilar II. The main
allegation of said original complaint was:
That on May 27, 1949 at about 11:30 o'clock in the morning, while the deceased Filomeno
Managuit was on board M/S "Pilar II" as such seaman, he jumped into the water to retrieve a 2peso bill belonging to him, and as a consequence of which, he was drowned.
On November 1, 1950, defendant filed a motion to dismiss upon the ground that said allegation does not
show that the death of plaintiff's son was due to an "accident arising out of and in the course of
employment," and that, accordingly, the complaint does not state a cause of action. This motion was
granted and the complaint dismissed, accordingly, by an order dated December 11, 1950. A motion for
the reconsideration of this order having been denied, plaintiff appealed to this Court, which, on October
30, 1952, rendered a decision affirming the order appealed from, but "without prejudice to the right of the
plaintiff, the mother of the deceased seaman, to file an amended complaint within fifteen (15) days from
notice by the clerk of the trial court that the record of this case had been remanded to and received by the
trial court, without costs." Hence, on December 22, 1952, plaintiff filed an amended complaint, paragraph
4 of which alleges:
That on May 27, 1949, at or about 11:30 o'clock in the morning while the said Filomeno Managuit
was in the course of his employment, performing his duties as such ordinary seaman on
defendant's M/S "Pilar II", which was anchored then about 1 1/2 miles from the seashore of Arceli

Dumarang, Palawan, his two-peso bill was blown by the breeze into the sea and in his effort to
retrieve the same from the waters he was drowned.
A motion to dismiss this amended complaint upon the ground of failure to state a cause of action was
granted and the case, consequently, dismissed without costs. Are consideration of this action having
been denied, the case is once again before us on appeal.
Plaintiff's claim is admittedly predicated upon Act No. 3428, otherwise known as the Workmen's
Compensation Act. The same was amended, first, by Act No. 3812, then, by Commonwealth Act No. 210
and, lastly, by Republic Act 772. The latter, however, took effect on June 20,1952 or after the accident
upon which plaintiff bases her cause of action. Hence, in the consideration of this case, we shall
disregard the provisions of said Republic Act No. 772. Sections 2 and 4 of Act No. 2428, prior to its latest
amendment, read:
Sec. 2. Grounds for compensation. When any employee receives a personal injury from any
accident arising out of and in the course of the employment, or contracts any illness directly
caused by such employment, or the result of the nature of such employment, his employer shall
pay compensation in the sums and to the persons hereinafter specified.
Sec. 4. Injuries not covered. Compensation shall not be allowed for injuries caused (1) by the
voluntary intent of the employee to inflict such injury upon himself or another person; (2) by
drunkenness on the part of the laborer who had the accident; (3) by notorious negligence of the
same.
Pursuant to these provisions in so far as pertinent to the case at bar three conditions are essential
to hold an employer liable to compensate his employee for a personal injury sustained by him from an
accident, namely: (1) the accident must arise out of the employment; (2) it must happen in the course of
the employment; and (3) it must not be caused by the "notorious negligence" of the employee.
Admittedly, the death of Filomeno Managuit was due to an accident. The point in issue is whether such
accident occurred under the three (3) conditions aforementioned. Referring to the first two requirements,
we said, in Afable et al. vs. Singer Sewing Machine Co. (58 Phil., 39, 42):
The phrase "due to and in the pursuance of" used in section 2 of Act No. 3428 was changed in
Act No. 3812 to "arising out of and in the course of". Discussing this phrase, the Supreme Court
of Illinois in the case of Muller Construction Co. vs. Industrial Board (283 Ill., 148; 118 N. E.,
1028; 1 W. C. L., 943), said:
"The words "arising out of" refer to the origin or cause of the accident and are descriptive of its
character, while the words `in the course of' refer to the time, place, and circumstances under
which the accident takes place. (Fitzgerald vs. Clarke & Sons, 1 B.W.C.C., 197 Dietzen Co. vs.
Industrial Board, 279 Ill. 11; 116 N.E. 684.) By the use of these words it was not the intention of
the legislature to make the employer an insurer against all accidental injuries which might happen
to an employee while in the course of the employment, but only for such injuries arising from or
growing out of the risks peculiar to the nature of work in the scope of the workmen's employment
or incidental to such employment, and accidents in which it is possible to trace the injury to some
risk or hazard to which the employee is exposed ina special degree by reason of such
employment. Risks to which all persons similarly situated are equally exposed and not traceable
in some special degree to the particular employment are excluded."
Adopting a liberal view, it may be conceded that the death of Filomeno took place "in the course of" his
employment, in that it happened at the "time" when, and at the "place" where-according to the amended
complaint-he was working. However, the accident which produced this tragic result did not "arise out of"
his employment. Indeed, the latter was not "the origin or cause of said accident. The blowing of his 2-

peso bill may have grown out of, or arisen from, his employment. It was the result of a risk peculiar to his
work as a seaman or incidental to such work. But, his death was the consequence of his decision to jump
into the water to retrieve said bill. The hazardous nature of this act was not due specially to the nature of
his employment. It was a risk to which any person on board the M/S Pilar II, such as a passenger thereof
or an ordinary visitor, would have been exposed had he, likewise, jumped into the sea, as Filomeno had.
Irrespective of whether or not the accident in question arose out of, or took place in the course of the
employment, was it caused by his "notorious negligence"? The phrase "notorious negligence" has been
held to be tantamount to "gross negligence", which, in turn, has been defined as follows:
Gross negligence is define to be the want of even slight care and diligence. (Mobile and M. R. Co.
vs. Aschcraft [1872] 48 Ala., 15.)
By gross negligence is meant "such entire want of care as to raise a presumption that the person
in fault is conscious of the probable consequences of carelessness, and is indifferent, or worse,
to the danger of injury to person or property of others." ... The negligence must amount to a
reckless disregard of the safety of person or property." (Wall vs. Cameron [1882] 6 Colo., 275;
see, also, The Law Governing Labor Disputes in the Philippines by Francisco, 2nd ed., p. 877.)
It cannot be denied that in jumping into the sea, one mile and a half from the seashore of Arceli,
Dumarang, Palawan, Filomeno failed to exercise "even slight care and diligence," that he displayed a
"reckless disregard of the safety" of his person, that he could not have been but conscious of the probable
consequences" of his carelessness and that he was "indifferent, or worse, to the danger of injury.
Thus, in the case of Government of the Philippines vs. The Manila Electric Co. (40 Off. Gaz., 9th Suppl.,
232),an employee of the Bureau of Posts who died by electrocution, as the lines which he was repairing
came into contact with those of the Manila Electric, was held to be guilty of gross negligence, he having
been previously warned that the service of electric light had been reestablished and that he should,
therefore be careful in handling the wires. The same conclusion was reached in De la Cruz vs. Hijos de I.
de la Rama and Co. (62 Phil., 653), involving a truck driver who died, because his truck fell into a ditch in
consequence of a false manuever he made to avoid collision with another car which unexpectedly
appeared on the road, while he was driving on the wrong side of the highway, at a speed of 40 to 50 km.
an hour.
To the same effect was the decision in Jahara vs. Mindanao Lumber Co. (57 Phil., 853), referring to a
laborer who was run over by a car, as he fell therefrom, when he tried to board it while moving backward.
Similarly, the death of a carpenter as he slipped from the roof of a building he was repairing was blamed
on his gross negligence in Caunan vs. Compania General de Tabacos (56 Phil., 542,545), he having
worn rubber shoes despite the fact that the roof was wet.
The case of Reyes vs. The City of Manila (G. R. No. 29112, July 18, 1933) referred to a watchman
assigned to a road-roller, who sat on a piece of board one end of which was over a box placed on the
hind wheels of the road-roller and the other end over a box of tools on the same rollert two meters above
the ground. As he tried to drive away the mosquitoes and flying ants which bothered him, the board
slipped off the wheel of the roller. So, he fell to the ground and his knee and left pelvis bumped against
the cement sidewalk, sustaining physical injuries as a consequence thereof. It was held that he had been
grossly negligent in seating on the piece of board which was precariously placed and in making motions
for the purpose of driving away the mosquitoes and flying ants. Again in Guilas vs. The Province of
Pampanga (G. R. No. 37744, July 21, 1933), a laborer on board a truck who stood up as it was
approaching a curve and fell over when the vehicle turned the curved, was held guilty of gross
negligence.

In none of these cases was the danger as apparent or imminent as when Filomeno Managuit jumped into
the sea to recover his 2-peso bill. Hence, there is more reason to hold that his death was caused by his
notorious negligence.
His case is easily distinguishable from that of Cuevo vs. Barredo (G.R. No. 45669, decided February 24,
1938, the employee involved therein, who appeared to be a good swimmer, having acted in obedience to
an order of his foreman, to save or protect a property of the employer. It is, also, distinguishable from
accidents occurring while the laborer or employee is answering a call of nature, or throwing away his
cigarette (Columbia Casualty Co. vs. Parham, 69 Ga. App. 258), or picking up his pipe, which had fallen,
or retrieving his shoes from a car into which a fellow worker had thrown it (Donovan vs. Bush Terminal
Co., 6 N. Y. S. 2nd 860, 255 App. Div. 737), these acts not being dangerous per se and the employee
being legally justified or supposed to perform either of them in the course of his employment. So, also, if,
while Filomeno Managuit was working, his 2-peso bill merely fell from his pocket, and as he picked up the
bill from the floor something accidentally fell upon him and injured him, he would surely be entitled to
compensation, his act being obviously innocent. In such case, it could be said, in the words of the Lord
President in Lauchlan vs. Anderson (S. C. 529), that "He had the right to be at the place ...; he was within
the time during which he was employed ...;and he was doing a thing which a man while working may
reasonably do-a workman of his sort may reasonably smoke, he may reasonably drop his pipe, and he
may reasonably pick it up again." (See Ramos vs. Poblete et al., 40 Off. Gaz., 3474). Jumping into the
sea, however, is entirely different, the danger which it entails being clear, potent and obvious.
In view of the foregoing the decision appealed from is hereby affirmed, without special pronouncement as
to costs.
It is so ordered.
Paras, C.J., Bengzon, Montemayor, Reyes, A., Jugo, Bautista Angelo, and Labrador, JJ., concur.

d. Standard of Conduct
1. General Rule
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 159617

August 8, 2007

ROBERTO C. SICAM and AGENCIA de R.C. SICAM, INC., petitioners,

vs.
LULU V. JORGE and CESAR JORGE, respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
Before us is a Petition for Review on Certiorari filed by Roberto C. Sicam, Jr. (petitioner Sicam) and
1
Agencia de R.C. Sicam, Inc. (petitioner corporation) seeking to annul the Decision of the Court of
2
Appeals dated March 31, 2003, and its Resolution dated August 8, 2003, in CA G.R. CV No. 56633.

It appears that on different dates from September to October 1987, Lulu V. Jorge (respondent Lulu)
pawned several pieces of jewelry with Agencia de R. C. Sicam located at No. 17 Aguirre Ave., BF Homes
Paraaque, Metro Manila, to secure a loan in the total amount of P59,500.00.
On October 19, 1987, two armed men entered the pawnshop and took away whatever cash and jewelry
were found inside the pawnshop vault. The incident was entered in the police blotter of the Southern
Police District, Paraaque Police Station as follows:
Investigation shows that at above TDPO, while victims were inside the office, two (2) male
unidentified persons entered into the said office with guns drawn. Suspects(sic) (1) went straight
inside and poked his gun toward Romeo Sicam and thereby tied him with an electric wire while
suspects (sic) (2) poked his gun toward Divina Mata and Isabelita Rodriguez and ordered them to
lay (sic) face flat on the floor. Suspects asked forcibly the case and assorted pawned jewelries
items mentioned above.
Suspects after taking the money and jewelries fled on board a Marson Toyota unidentified plate
3
number.
Petitioner Sicam sent respondent Lulu a letter dated October 19, 1987 informing her of the loss of her
jewelry due to the robbery incident in the pawnshop. On November 2, 1987, respondent Lulu then wrote a
4
letter to petitioner Sicam expressing disbelief stating that when the robbery happened, all jewelry
pawned were deposited with Far East Bank near the pawnshop since it had been the practice that before
they could withdraw, advance notice must be given to the pawnshop so it could withdraw the jewelry from
the bank. Respondent Lulu then requested petitioner Sicam to prepare the pawned jewelry for withdrawal
on November 6, 1987 but petitioner Sicam failed to return the jewelry.
On September 28, 1988, respondent Lulu joined by her husband, Cesar Jorge, filed a complaint against
petitioner Sicam with the Regional Trial Court of Makati seeking indemnification for the loss of pawned
jewelry and payment of actual, moral and exemplary damages as well as attorney's fees. The case was
docketed as Civil Case No. 88-2035.
Petitioner Sicam filed his Answer contending that he is not the real party-in-interest as the pawnshop was
incorporated on April 20, 1987 and known as Agencia de R.C. Sicam, Inc; that petitioner corporation had
exercised due care and diligence in the safekeeping of the articles pledged with it and could not be made
liable for an event that is fortuitous.
Respondents subsequently filed an Amended Complaint to include petitioner corporation.
Thereafter, petitioner Sicam filed a Motion to Dismiss as far as he is concerned considering that he is not
the real party-in-interest. Respondents opposed the same. The RTC denied the motion in an Order dated
5
November 8, 1989.
6

After trial on the merits, the RTC rendered its Decision dated January 12, 1993, dismissing respondents
complaint as well as petitioners counterclaim. The RTC held that petitioner Sicam could not be made
personally liable for a claim arising out of a corporate transaction; that in the Amended Complaint of
respondents, they asserted that "plaintiff pawned assorted jewelries in defendants' pawnshop"; and that
as a consequence of the separate juridical personality of a corporation, the corporate debt or credit is not
the debt or credit of a stockholder.
The RTC further ruled that petitioner corporation could not be held liable for the loss of the pawned
jewelry since it had not been rebutted by respondents that the loss of the pledged pieces of jewelry in the
possession of the corporation was occasioned by armed robbery; that robbery is a fortuitous event which
7
exempts the victim from liability for the loss, citing the case of Austria v. Court of Appeals; and that the

parties transaction was that of a pledgor and pledgee and under Art. 1174 of the Civil Code, the
pawnshop as a pledgee is not responsible for those events which could not be foreseen.
Respondents appealed the RTC Decision to the CA. In a Decision dated March 31, 2003, the CA
reversed the RTC, the dispositive portion of which reads as follows:
WHEREFORE, premises considered, the instant Appeal is GRANTED, and the Decision dated
January 12, 1993,of the Regional Trial Court of Makati, Branch 62, is hereby REVERSED and
SET ASIDE, ordering the appellees to pay appellants the actual value of the lost jewelry
8
amounting to P272,000.00, and attorney' fees of P27,200.00.
In finding petitioner Sicam liable together with petitioner corporation, the CA applied the doctrine of
piercing the veil of corporate entity reasoning that respondents were misled into thinking that they were
dealing with the pawnshop owned by petitioner Sicam as all the pawnshop tickets issued to them bear the
words "Agencia de R.C. Sicam"; and that there was no indication on the pawnshop tickets that it was the
petitioner corporation that owned the pawnshop which explained why respondents had to amend their
complaint impleading petitioner corporation.
The CA further held that the corresponding diligence required of a pawnshop is that it should take steps
to secure and protect the pledged items and should take steps to insure itself against the loss of articles
which are entrusted to its custody as it derives earnings from the pawnshop trade which petitioners failed
to do; that Austria is not applicable to this case since the robbery incident happened in 1961 when the
criminality had not as yet reached the levels attained in the present day; that they are at least guilty of
contributory negligence and should be held liable for the loss of jewelries; and that robberies and holdups are foreseeable risks in that those engaged in the pawnshop business are expected to foresee.
The CA concluded that both petitioners should be jointly and severally held liable to respondents for the
loss of the pawned jewelry.
Petitioners motion for reconsideration was denied in a Resolution dated August 8, 2003.
Hence, the instant petition for review with the following assignment of errors:
THE COURT OF APPEALS ERRED AND WHEN IT DID, IT OPENED ITSELF TO REVERSAL,
WHEN IT ADOPTED UNCRITICALLY (IN FACT IT REPRODUCED AS ITS OWN WITHOUT IN
THE MEANTIME ACKNOWLEDGING IT) WHAT THE RESPONDENTS ARGUED IN THEIR
BRIEF, WHICH ARGUMENT WAS PALPABLY UNSUSTAINABLE.
THE COURT OF APPEALS ERRED, AND WHEN IT DID, IT OPENED ITSELF TO REVERSAL
BY THIS HONORABLE COURT, WHEN IT AGAIN ADOPTED UNCRITICALLY (BUT WITHOUT
ACKNOWLEDGING IT) THE SUBMISSIONS OF THE RESPONDENTS IN THEIR BRIEF
WITHOUT ADDING ANYTHING MORE THERETO DESPITE THE FACT THAT THE SAID
ARGUMENT OF THE RESPONDENTS COULD NOT HAVE BEEN SUSTAINED IN VIEW OF
9
UNREBUTTED EVIDENCE ON RECORD.
Anent the first assigned error, petitioners point out that the CAs finding that petitioner Sicam is personally
liable for the loss of the pawned jewelries is "a virtual and uncritical reproduction of the arguments set out
10
on pp. 5-6 of the Appellants brief."
Petitioners argue that the reproduced arguments of respondents in their Appellants Brief suffer from
infirmities, as follows:

(1) Respondents conclusively asserted in paragraph 2 of their Amended Complaint that Agencia
de R.C. Sicam, Inc. is the present owner of Agencia de R.C. Sicam Pawnshop, and therefore, the
CA cannot rule against said conclusive assertion of respondents;
(2) The issue resolved against petitioner Sicam was not among those raised and litigated in the
trial court; and
(3) By reason of the above infirmities, it was error for the CA to have pierced the corporate veil
since a corporation has a personality distinct and separate from its individual stockholders or
members.
Anent the second error, petitioners point out that the CA finding on their negligence is likewise an
unedited reproduction of respondents brief which had the following defects:
(1) There were unrebutted evidence on record that petitioners had observed the diligence
required of them, i.e, they wanted to open a vault with a nearby bank for purposes of safekeeping
the pawned articles but was discouraged by the Central Bank (CB) since CB rules provide that
they can only store the pawned articles in a vault inside the pawnshop premises and no other
place;
(2) Petitioners were adjudged negligent as they did not take insurance against the loss of the
pledged jelweries, but it is judicial notice that due to high incidence of crimes, insurance
companies refused to cover pawnshops and banks because of high probability of losses due to
robberies;
(3) In Hernandez v. Chairman, Commission on Audit (179 SCRA 39, 45-46), the victim of robbery
was exonerated from liability for the sum of money belonging to others and lost by him to robbers.
Respondents filed their Comment and petitioners filed their Reply thereto. The parties subsequently
submitted their respective Memoranda.
We find no merit in the petition.
To begin with, although it is true that indeed the CA findings were exact reproductions of the arguments
raised in respondents (appellants) brief filed with the CA, we find the same to be not fatally infirmed.
Upon examination of the Decision, we find that it expressed clearly and distinctly the facts and the law on
which it is based as required by Section 8, Article VIII of the Constitution. The discretion to decide a case
one way or another is broad enough to justify the adoption of the arguments put forth by one of the
11
parties, as long as these are legally tenable and supported by law and the facts on records.
Our jurisdiction under Rule 45 of the Rules of Court is limited to the review of errors of law committed by
the appellate court. Generally, the findings of fact of the appellate court are deemed conclusive and we
are not duty-bound to analyze and calibrate all over again the evidence adduced by the parties in the
12
court a quo. This rule, however, is not without exceptions, such as where the factual findings of the
13
Court of Appeals and the trial court are conflicting or contradictory as is obtaining in the instant case.
However, after a careful examination of the records, we find no justification to absolve petitioner Sicam
from liability.
The CA correctly pierced the veil of the corporate fiction and adjudged petitioner Sicam liable together
with petitioner corporation. The rule is that the veil of corporate fiction may be pierced when made as a
14
shield to perpetrate fraud and/or confuse legitimate issues. The theory of corporate entity was not
15
meant to promote unfair objectives or otherwise to shield them.

Notably, the evidence on record shows that at the time respondent Lulu pawned her jewelry, the
pawnshop was owned by petitioner Sicam himself. As correctly observed by the CA, in all the pawnshop
receipts issued to respondent Lulu in September 1987, all bear the words "Agencia de R. C. Sicam,"
notwithstanding that the pawnshop was allegedly incorporated in April 1987. The receipts issued after
such alleged incorporation were still in the name of "Agencia de R. C. Sicam," thus inevitably misleading,
or at the very least, creating the wrong impression to respondents and the public as well, that the
pawnshop was owned solely by petitioner Sicam and not by a corporation.
16

Even petitioners counsel, Atty. Marcial T. Balgos, in his letter dated October 15, 1987 addressed to the
Central Bank, expressly referred to petitioner Sicam as the proprietor of the pawnshop notwithstanding
the alleged incorporation in April 1987.
We also find no merit in petitioners' argument that since respondents had alleged in their Amended
Complaint that petitioner corporation is the present owner of the pawnshop, the CA is bound to decide the
case on that basis.
Section 4 Rule 129 of the Rules of Court provides that an admission, verbal or written, made by a party in
the course of the proceedings in the same case, does not require proof. The admission may be
contradicted only by showing that it was made through palpable mistake or that no such admission was
made.
Thus, the general rule that a judicial admission is conclusive upon the party making it and does not
require proof, admits of two exceptions, to wit: (1) when it is shown that such admission was made
through palpable mistake, and (2) when it is shown that no such admission was in fact made. The latter
17
exception allows one to contradict an admission by denying that he made such an admission.
The Committee on the Revision of the Rules of Court explained the second exception in this wise:
x x x if a party invokes an "admission" by an adverse party, but cites the admission "out of
context," then the one making the "admission" may show that he made no "such" admission, or
that his admission was taken out of context.
x x x that the party can also show that he made no "such admission", i.e., not in the sense
in which the admission is made to appear.
That is the reason for the modifier "such" because if the rule simply states that the admission may
be contradicted by showing that "no admission was made," the rule would not really be providing
18
for a contradiction of the admission but just a denial. (Emphasis supplied).
While it is true that respondents alleged in their Amended Complaint that petitioner corporation is the
present owner of the pawnshop, they did so only because petitioner Sicam alleged in his Answer to the
original complaint filed against him that he was not the real party-in-interest as the pawnshop was
incorporated in April 1987. Moreover, a reading of the Amended Complaint in its entirety shows that
respondents referred to both petitioner Sicam and petitioner corporation where they (respondents)
pawned their assorted pieces of jewelry and ascribed to both the failure to observe due diligence
commensurate with the business which resulted in the loss of their pawned jewelry.
Markedly, respondents, in their Opposition to petitioners Motion to Dismiss Amended Complaint, insofar
as petitioner Sicam is concerned, averred as follows:
Roberto C. Sicam was named the defendant in the original complaint because the pawnshop
tickets involved in this case did not show that the R.C. Sicam Pawnshop was a corporation. In

paragraph 1 of his Answer, he admitted the allegations in paragraph 1 and 2 of the Complaint. He
merely added "that defendant is not now the real party in interest in this case."
It was defendant Sicam's omission to correct the pawnshop tickets used in the subject
transactions in this case which was the cause of the instant action. He cannot now ask for the
dismissal of the complaint against him simply on the mere allegation that his pawnshop business
is now incorporated. It is a matter of defense, the merit of which can only be reached after
19
consideration of the evidence to be presented in due course.
Unmistakably, the alleged admission made in respondents' Amended Complaint was taken "out of
context" by petitioner Sicam to suit his own purpose. Ineluctably, the fact that petitioner Sicam continued
to issue pawnshop receipts under his name and not under the corporation's name militates for the
piercing of the corporate veil.
We likewise find no merit in petitioners' contention that the CA erred in piercing the veil of corporate fiction
of petitioner corporation, as it was not an issue raised and litigated before the RTC.
Petitioner Sicam had alleged in his Answer filed with the trial court that he was not the real party-ininterest because since April 20, 1987, the pawnshop business initiated by him was incorporated and
known as Agencia de R.C. Sicam. In the pre-trial brief filed by petitioner Sicam, he submitted that as far
as he was concerned, the basic issue was whether he is the real party in interest against whom the
20
complaint should be directed. In fact, he subsequently moved for the dismissal of the complaint as to
him but was not favorably acted upon by the trial court. Moreover, the issue was squarely passed upon,
although erroneously, by the trial court in its Decision in this manner:
x x x The defendant Roberto Sicam, Jr likewise denies liability as far as he is concerned for the
reason that he cannot be made personally liable for a claim arising from a corporate transaction.
This Court sustains the contention of the defendant Roberto C. Sicam, Jr. The amended
complaint itself asserts that "plaintiff pawned assorted jewelries in defendant's pawnshop." It has
been held that " as a consequence of the separate juridical personality of a corporation, the
corporate debt or credit is not the debt or credit of the stockholder, nor is the stockholder's debt or
21
credit that of a corporation.
Clearly, in view of the alleged incorporation of the pawnshop, the issue of whether petitioner Sicam is
personally liable is inextricably connected with the determination of the question whether the doctrine of
piercing the corporate veil should or should not apply to the case.
The next question is whether petitioners are liable for the loss of the pawned articles in their possession.
Petitioners insist that they are not liable since robbery is a fortuitous event and they are not negligent at
all.
We are not persuaded.
Article 1174 of the Civil Code provides:
Art. 1174. Except in cases expressly specified by the law, or when it is otherwise declared by
stipulation, or when the nature of the obligation requires the assumption of risk, no person shall
be responsible for those events which could not be foreseen or which, though foreseen, were
inevitable.

Fortuitous events by definition are extraordinary events not foreseeable or avoidable. It is therefore, not
enough that the event should not have been foreseen or anticipated, as is commonly believed but it must
be one impossible to foresee or to avoid. The mere difficulty to foresee the happening is not impossibility
22
to foresee the same.
To constitute a fortuitous event, the following elements must concur: (a) the cause of the unforeseen and
unexpected occurrence or of the failure of the debtor to comply with obligations must be independent of
human will; (b) it must be impossible to foresee the event that constitutes the caso fortuito or, if it can be
foreseen, it must be impossible to avoid; (c) the occurrence must be such as to render it impossible for
the debtor to fulfill obligations in a normal manner; and, (d) the obligor must be free from any participation
23
in the aggravation of the injury or loss.
24

The burden of proving that the loss was due to a fortuitous event rests on him who invokes it. And, in
order for a fortuitous event to exempt one from liability, it is necessary that one has committed no
25
negligence or misconduct that may have occasioned the loss.
It has been held that an act of God cannot be invoked to protect a person who has failed to take steps to
forestall the possible adverse consequences of such a loss. One's negligence may have concurred with
an act of God in producing damage and injury to another; nonetheless, showing that the immediate or
proximate cause of the damage or injury was a fortuitous event would not exempt one from liability. When
the effect is found to be partly the result of a person's participation -- whether by active intervention,
neglect or failure to act -- the whole occurrence is humanized and removed from the rules applicable to
26
acts of God.
Petitioner Sicam had testified that there was a security guard in their pawnshop at the time of the robbery.
He likewise testified that when he started the pawnshop business in 1983, he thought of opening a vault
with the nearby bank for the purpose of safekeeping the valuables but was discouraged by the Central
Bank since pawned articles should only be stored in a vault inside the pawnshop. The very measures
which petitioners had allegedly adopted show that to them the possibility of robbery was not only
foreseeable, but actually foreseen and anticipated. Petitioner Sicams testimony, in effect, contradicts
petitioners defense of fortuitous event.
Moreover, petitioners failed to show that they were free from any negligence by which the loss of the
pawned jewelry may have been occasioned.
Robbery per se, just like carnapping, is not a fortuitous event. It does not foreclose the possibility of
27
negligence on the part of herein petitioners. In Co v. Court of Appeals, the Court held:
It is not a defense for a repair shop of motor vehicles to escape liability simply because the
damage or loss of a thing lawfully placed in its possession was due to carnapping. Carnapping
per se cannot be considered as a fortuitous event. The fact that a thing was unlawfully and
forcefully taken from another's rightful possession, as in cases of carnapping, does not
automatically give rise to a fortuitous event. To be considered as such, carnapping entails
more than the mere forceful taking of another's property. It must be proved and
established that the event was an act of God or was done solely by third parties and that
neither the claimant nor the person alleged to be negligent has any participation. In
accordance with the Rules of Evidence, the burden of proving that the loss was due to a
fortuitous event rests on him who invokes it which in this case is the private
respondent. However, other than the police report of the alleged carnapping incident, no other
evidence was presented by private respondent to the effect that the incident was not due to its
fault. A police report of an alleged crime, to which only private respondent is privy, does not
suffice to establish the carnapping. Neither does it prove that there was no fault on the part of
private respondent notwithstanding the parties' agreement at the pre-trial that the car was

carnapped. Carnapping does not foreclose the possibility of fault or negligence on the part of
28
private respondent.
Just like in Co, petitioners merely presented the police report of the Paraaque Police Station on the
robbery committed based on the report of petitioners' employees which is not sufficient to establish
robbery. Such report also does not prove that petitioners were not at fault.
On the contrary, by the very evidence of petitioners, the CA did not err in finding that petitioners are guilty
of concurrent or contributory negligence as provided in Article 1170 of the Civil Code, to wit:
Art. 1170. Those who in the performance of their obligations are guilty of fraud, negligence, or
29
delay, and those who in any manner contravene the tenor thereof, are liable for damages.
Article 2123 of the Civil Code provides that with regard to pawnshops and other establishments which are
engaged in making loans secured by pledges, the special laws and regulations concerning them shall be
observed, and subsidiarily, the provisions on pledge, mortgage and antichresis.
The provision on pledge, particularly Article 2099 of the Civil Code, provides that the creditor shall take
care of the thing pledged with the diligence of a good father of a family. This means that petitioners must
take care of the pawns the way a prudent person would as to his own property.
In this connection, Article 1173 of the Civil Code further provides:
Art. 1173. The fault or negligence of the obligor consists in the omission of that diligence which is
required by the nature of the obligation and corresponds with the circumstances of the persons,
of time and of the place. When negligence shows bad faith, the provisions of Articles 1171 and
2201, paragraph 2 shall apply.
If the law or contract does not state the diligence which is to be observed in the performance, that
which is expected of a good father of a family shall be required.
30

We expounded in Cruz v. Gangan that negligence is the omission to do something which a reasonable
man, guided by those considerations which ordinarily regulate the conduct of human affairs, would do; or
31
the doing of something which a prudent and reasonable man would not do. It is want of care required by
the circumstances.
A review of the records clearly shows that petitioners failed to exercise reasonable care and caution that
an ordinarily prudent person would have used in the same situation. Petitioners were guilty of negligence
in the operation of their pawnshop business. Petitioner Sicam testified, thus:
Court:
Q. Do you have security guards in your pawnshop?
A. Yes, your honor.
Q. Then how come that the robbers were able to enter the premises when according to you there
was a security guard?
A. Sir, if these robbers can rob a bank, how much more a pawnshop.

Q. I am asking you how were the robbers able to enter despite the fact that there was a security
guard?
A. At the time of the incident which happened about 1:00 and 2:00 o'clock in the afternoon and it
happened on a Saturday and everything was quiet in the area BF Homes Paraaque they
pretended to pawn an article in the pawnshop, so one of my employees allowed him to come in
and it was only when it was announced that it was a hold up.
Q. Did you come to know how the vault was opened?
A. When the pawnshop is official (sic) open your honor the pawnshop is partly open. The
combination is off.
Q. No one open (sic) the vault for the robbers?
A. No one your honor it was open at the time of the robbery.
Q. It is clear now that at the time of the robbery the vault was open the reason why the robbers
were able to get all the items pawned to you inside the vault.
A. Yes sir.

32

revealing that there were no security measures adopted by petitioners in the operation of the pawnshop.
Evidently, no sufficient precaution and vigilance were adopted by petitioners to protect the pawnshop
from unlawful intrusion. There was no clear showing that there was any security guard at all. Or if there
was one, that he had sufficient training in securing a pawnshop. Further, there is no showing that the
alleged security guard exercised all that was necessary to prevent any untoward incident or to ensure that
no suspicious individuals were allowed to enter the premises. In fact, it is even doubtful that there was a
security guard, since it is quite impossible that he would not have noticed that the robbers were armed
33
with caliber .45 pistols each, which were allegedly poked at the employees. Significantly, the alleged
security guard was not presented at all to corroborate petitioner Sicam's claim; not one of petitioners'
employees who were present during the robbery incident testified in court.
Furthermore, petitioner Sicam's admission that the vault was open at the time of robbery is clearly a proof
of petitioners' failure to observe the care, precaution and vigilance that the circumstances justly
demanded. Petitioner Sicam testified that once the pawnshop was open, the combination was already off.
Considering petitioner Sicam's testimony that the robbery took place on a Saturday afternoon and the
area in BF Homes Paraaque at that time was quiet, there was more reason for petitioners to have
exercised reasonable foresight and diligence in protecting the pawned jewelries. Instead of taking the
precaution to protect them, they let open the vault, providing no difficulty for the robbers to cart away the
pawned articles.
We, however, do not agree with the CA when it found petitioners negligent for not taking steps to insure
themselves against loss of the pawned jewelries.
Under Section 17 of Central Bank Circular No. 374, Rules and Regulations for Pawnshops, which took
effect on July 13, 1973, and which was issued pursuant to Presidential Decree No. 114, Pawnshop
Regulation Act, it is provided that pawns pledged must be insured, to wit:
Sec. 17. Insurance of Office Building and Pawns- The place of business of a pawnshop and the
pawns pledged to it must be insured against fire and against burglary as well as for the
latter(sic), by an insurance company accredited by the Insurance Commissioner.

However, this Section was subsequently amended by CB Circular No. 764 which took effect on October
1, 1980, to wit:
Sec. 17 Insurance of Office Building and Pawns The office building/premises and pawns of a
pawnshop must be insured against fire. (emphasis supplied).
where the requirement that insurance against burglary was deleted. Obviously, the Central Bank
considered it not feasible to require insurance of pawned articles against burglary.
The robbery in the pawnshop happened in 1987, and considering the above-quoted amendment, there is
no statutory duty imposed on petitioners to insure the pawned jewelry in which case it was error for the
CA to consider it as a factor in concluding that petitioners were negligent.
Nevertheless, the preponderance of evidence shows that petitioners failed to exercise the diligence
required of them under the Civil Code.
The diligence with which the law requires the individual at all times to govern his conduct varies with the
34
nature of the situation in which he is placed and the importance of the act which he is to perform. Thus,
35
36
the cases of Austria v. Court of Appeals, Hernandez v. Chairman, Commission on Audit and Cruz v.
37
Gangan cited by petitioners in their pleadings, where the victims of robbery were exonerated from
liability, find no application to the present case.
In Austria, Maria Abad received from Guillermo Austria a pendant with diamonds to be sold on
commission basis, but which Abad failed to subsequently return because of a robbery committed upon
her in 1961. The incident became the subject of a criminal case filed against several persons. Austria filed
an action against Abad and her husband (Abads) for recovery of the pendant or its value, but the Abads
set up the defense that the robbery extinguished their obligation. The RTC ruled in favor of Austria, as the
Abads failed to prove robbery; or, if committed, that Maria Abad was guilty of negligence. The CA,
however, reversed the RTC decision holding that the fact of robbery was duly established and declared
the Abads not responsible for the loss of the jewelry on account of a fortuitous event. We held that for the
Abads to be relieved from the civil liability of returning the pendant under Art. 1174 of the Civil Code, it
would only be sufficient that the unforeseen event, the robbery, took place without any concurrent fault on
the debtors part, and this can be done by preponderance of evidence; that to be free from liability for
reason of fortuitous event, the debtor must, in addition to the casus itself, be free of any concurrent or
38
contributory fault or negligence.
We found in Austria that under the circumstances prevailing at the time the Decision was promulgated in
1971, the City of Manila and its suburbs had a high incidence of crimes against persons and property that
rendered travel after nightfall a matter to be sedulously avoided without suitable precaution and
protection; that the conduct of Maria Abad in returning alone to her house in the evening carrying jewelry
of considerable value would have been negligence per se and would not exempt her from responsibility in
the case of robbery. However we did not hold Abad liable for negligence since, the robbery happened ten
years previously; i.e., 1961, when criminality had not reached the level of incidence obtaining in 1971.
In contrast, the robbery in this case took place in 1987 when robbery was already prevalent and
petitioners in fact had already foreseen it as they wanted to deposit the pawn with a nearby bank for
safekeeping. Moreover, unlike in Austria, where no negligence was committed, we found petitioners
negligent in securing their pawnshop as earlier discussed.
In Hernandez, Teodoro Hernandez was the OIC and special disbursing officer of the Ternate Beach
Project of the Philippine Tourism in Cavite. In the morning of July 1, 1983, a Friday, he went to Manila to
encash two checks covering the wages of the employees and the operating expenses of the project.
However for some reason, the processing of the check was delayed and was completed at about 3 p.m.
Nevertheless, he decided to encash the check because the project employees would be waiting for their

pay the following day; otherwise, the workers would have to wait until July 5, the earliest time, when the
main office would open. At that time, he had two choices: (1) return to Ternate, Cavite that same
afternoon and arrive early evening; or (2) take the money with him to his house in Marilao, Bulacan,
spend the night there, and leave for Ternate the following day. He chose the second option, thinking it
was the safer one. Thus, a little past 3 p.m., he took a passenger jeep bound for Bulacan. While the jeep
was on Epifanio de los Santos Avenue, the jeep was held up and the money kept by Hernandez was
taken, and the robbers jumped out of the jeep and ran. Hernandez chased the robbers and caught up
with one robber who was subsequently charged with robbery and pleaded guilty. The other robber who
held the stolen money escaped. The Commission on Audit found Hernandez negligent because he had
not brought the cash proceeds of the checks to his office in Ternate, Cavite for safekeeping, which is the
normal procedure in the handling of funds. We held that Hernandez was not negligent in deciding to
encash the check and bringing it home to Marilao, Bulacan instead of Ternate, Cavite due to the lateness
of the hour for the following reasons: (1) he was moved by unselfish motive for his co-employees to
collect their wages and salaries the following day, a Saturday, a non-working, because to encash the
check on July 5, the next working day after July 1, would have caused discomfort to laborers who were
dependent on their wages for sustenance; and (2) that choosing Marilao as a safer destination, being
nearer, and in view of the comparative hazards in the trips to the two places, said decision seemed logical
at that time. We further held that the fact that two robbers attacked him in broad daylight in the jeep while
it was on a busy highway and in the presence of other passengers could not be said to be a result of his
imprudence and negligence.
Unlike in Hernandez where the robbery happened in a public utility, the robbery in this case took place in
the pawnshop which is under the control of petitioners. Petitioners had the means to screen the persons
who were allowed entrance to the premises and to protect itself from unlawful intrusion. Petitioners had
failed to exercise precautionary measures in ensuring that the robbers were prevented from entering the
pawnshop and for keeping the vault open for the day, which paved the way for the robbers to easily cart
away the pawned articles.
In Cruz, Dr. Filonila O. Cruz, Camanava District Director of Technological Education and Skills
Development Authority (TESDA), boarded the Light Rail Transit (LRT) from Sen. Puyat Avenue to
Monumento when her handbag was slashed and the contents were stolen by an unidentified person.
Among those stolen were her wallet and the government-issued cellular phone. She then reported the
incident to the police authorities; however, the thief was not located, and the cellphone was not
recovered. She also reported the loss to the Regional Director of TESDA, and she requested that she be
freed from accountability for the cellphone. The Resident Auditor denied her request on the ground that
she lacked the diligence required in the custody of government property and was ordered to pay the
purchase value in the total amount of P4,238.00. The COA found no sufficient justification to grant the
request for relief from accountability. We reversed the ruling and found that riding the LRT cannot per se
be denounced as a negligent act more so because Cruzs mode of transit was influenced by time and
money considerations; that she boarded the LRT to be able to arrive in Caloocan in time for her 3 pm
meeting; that any prudent and rational person under similar circumstance can reasonably be expected to
do the same; that possession of a cellphone should not hinder one from boarding the LRT coach as Cruz
did considering that whether she rode a jeep or bus, the risk of theft would have also been present; that
because of her relatively low position and pay, she was not expected to have her own vehicle or to ride a
taxicab; she did not have a government assigned vehicle; that placing the cellphone in a bag away from
covetous eyes and holding on to that bag as she did is ordinarily sufficient care of a cellphone while
traveling on board the LRT; that the records did not show any specific act of negligence on her part and
negligence can never be presumed.
Unlike in the Cruz case, the robbery in this case happened in petitioners' pawnshop and they were
negligent in not exercising the precautions justly demanded of a pawnshop.
WHEREFORE, except for the insurance aspect, the Decision of the Court of Appeals dated March 31,
2003 and its Resolution dated August 8, 2003, are AFFIRMED.

Costs against petitioners.

SO ORDERED.
Ynares-Santiago, Chairperson, Chico-Nazario, Nachura, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 160795

June 27, 2008

CORINTHIAN GARDENS ASSOCIATION, INC., petitioner,

vs.
SPOUSES REYNALDO and MARIA LUISA TANJANGCO, and SPOUSES FRANK and TERESITA
CUASO, respondent.
DECISION
NACHURA, J.:
1

Before this Court is a Petition for Review on Certiorari under Rule 45 of the Rules of Civil Procedure
2
seeking the reversal of the Court of Appeals (CA) Decision dated January 31, 2003 in CA-G.R. CV No.
3
43217, which reversed and set aside the Decision of the Regional Trial Court (RTC) of Quezon City,
dated March 30, 1993.
The Antecedents:
Respondents-spouses Reynaldo and Maria Luisa Tanjangco (the Tanjangcos) own Lots 68 and 69
4
5
covered by Transfer Certificates of Title (TCT) No. 242245 and 282961 respectively, located at
Corinthian Gardens Subdivision, Quezon City, which is managed by petitioner Corinthian Gardens
Association, Inc. (Corinthian). On the other hand, respondents-spouses Frank and Teresita Cuaso (the
Cuasos) own Lot 65 which is adjacent to the Tanjangcos lots.
Before the Cuasos constructed their house on Lot 65, a relocation survey was necessary. As Geodetic
Engineer Democrito De Dios (Engr. De Dios), operating under the business name D.M. De Dios Realty
and Surveying, conducted all the previous surveys for the subdivision's developer, Corinthian referred
Engr. De Dios to the Cuasos. Before, during and after the construction of the said house, Corinthian
conducted periodic ocular inspections in order to determine compliance with the approved plans pursuant
6
to the Manual of Rules and Regulations of Corinthian. Unfortunately, after the Cuasos constructed their
house employing the services of C.B. Paraz & Construction Co., Inc. (C.B. Paraz) as builder, their
perimeter fence encroached on the Tanjangcos Lot 69 by 87 square meters.
No amicable settlement was reached between the parties. Thus, the Tanjangcos demanded that the
Cuasos demolish the perimeter fence but the latter failed and refused, prompting the Tanjangcos to file
7
with the RTC a suit against the Cuasos for Recovery of Possession with Damages.
8

Eventually, the Cuasos filed a Third-Party Complaint against Corinthian, C.B. Paraz and Engr. De Dios.
The Cuasos ascribed negligence to C.B. Paraz for its failure to ascertain the proper specifications of their
house, and to Engr. De Dios for his failure to undertake an accurate relocation survey, thereby, exposing
them to litigation. The Cuasos also faulted Corinthian for approving their relocation survey and building

plans without verifying their accuracy and in making representations as to Engr. De Dios' integrity and
competence. The Cuasos alleged that had Corinthian exercised diligence in performing its duty, they
would not have been involved in a boundary dispute with the Tanjangcos. Thus, the Cuasos opined that
Corinthian should also be held answerable for any damages that they might incur as a result of such
construction.
On March 30, 1993, the RTC rendered a Decision in favor of the Tanjangcos. It ruled that the Cuasos
perimeter wall encroached on the land of the Tanjangos by 87 square meters. It, however, ruled that the
Cuasos were builders in good faith, and gave the Tanjangcos the option to sell and the Cuasos the option
to buy the encroaching portion of the land, at a price to be agreed upon by the parties within sixty (60)
days from receipt of the said Decision. In the event that the Cuasos were unable and unwilling to
purchase the said portion, the perimeter wall should be demolished at the latters expense. The RTC also
ordered the Cuasos to pay monthly rentals of P2,000.00 commencing from the time of the filing of the
complaint. The RTC likewise held that C.B. Paraz was grossly negligent in not taking into account the
correct boundaries of Cuasos lot when it constructed the house. It, thus, ordered C.B. Paraz to pay moral
and exemplary damages as well as attorneys fees to the Tanjangcos and the Cuasos. The third-party
complaint against Corinthian and Engr. De Dios, on the other hand, was dismissed for lack of cause of
action.
9

The Tanjangcos filed a Motion for Reconsideration of the said RTC Decision which the RTC, however,
10
denied in its Order dated June 28, 1993.
Dissatisfied with the RTC ruling, the Tanjangcos, the Cuasos, and C.B. Paraz all appealed to the CA.
On appeal, the CA reversed and set aside the RTC Decision. It held that the Cuasos acted in bad faith in
land-grabbing the 87 square meter-portion of Lot 69 as of April 5, 1989. Correlatively, the CA allowed the
Tanjangcos to exercise the rights granted under Articles 449, 450, 451 and 549 of the New Civil Code,
which include the right to demand the demolition of the offending perimeter wall after reimbursing the
Cuasos the necessary expenses for the preservation of the encroached area. The Cuasos were ordered
to pay monthly rentals of P10,000.00 for the use, enjoyment and occupancy of the lot from 1989 up to the
time they vacate the property considering the location and category of the same. They were, likewise,
ordered to pay the Tanjangcos P100,000.00, as moral damages, P50,000.00 as exemplary damages,
and P150,000.00 as attorneys fees. The CA also imposed six percent (6%) interest per annum on all the
awards. The Cuasos appeal against the Tanjangcos, on the other hand, was dismissed for lack of merit.
On the third-party complaints, Corinthian, C.B. Paraz and Engr. De Dios were all found negligent in
performing their respective duties and so they were ordered to contribute five percent (5%) each, or a
total of fifteen percent (15%) to all judgment sums and amounts that the Cuasos shall eventually pay
under the decision, also with interest of six percent (6%) per annum.
11

Only Corinthian filed a Motion for Reconsideration of the CA Decision within the 15-day reglementary
period. No motion for reconsideration was filed by the Cuasos, C.B. Paraz and/or Engr. De Dios.
About six (6) months later, or on August 12, 2003, the Cuasos filed a Comment/Manifestation
that they be allowed to adopt Corinthians Motion for Reconsideration.
In its Resolution

13

12

praying

dated November 14, 2003, the CA denied Corinthians Motion for Reconsideration.

Hence, Corinthian filed the instant Petition for Review on Certiorari assailing the CA Decision and
Resolution, and impleading the Cuasos as one of the respondents being the third-party plaintiffs in the
RTC.
This Court gave due course to Corinthians petition and required the parties to submit their respective
14
15
memorandum. In compliance, the Cuasos submitted their Memorandum and Supplement to

16

Memorandum, which were both noted by this Court in its Resolutions dated January 10, 2005
18
February 2, 2005, respectively.

17

and

In the meantime, the Tanjangcos moved for partial entry of judgment of the CA Decision which was
19
granted by the CA in its Resolution dated May 26, 2006, directing the issuance of an Entry of Judgment
and a Certification that its Decision dated January 31 2003 has become final and executory with respect
to the Cuasos, C.B. Paraz and Engr. De Dios for their failure to file an appeal assailing the said Decision
before this Court.
The Tanjangcos then moved for the execution of the judgment against the Cuasos, specifically the
20
21
demolition of the perimeter fence, which was also granted by the RTC in its Order dated December
18, 2006.
22

23

Other than the filing of an Opposition and a Motion for Reconsideration before the RTC, the Cuasos
prayed for the issuance of a temporary restraining order (TRO) and/or preliminary injunction before this
Court to enjoin the demolition of the perimeter fence. They averred that the premature demolition of the
alleged encroaching perimeter wall and other improvements will cause grave and irreparable damage to
them, because what is sought to be demolished is part of their residence. They claimed that no amount of
money will compensate for the damage they stand to suffer should any demolition subsequently prove to
be wrongful. They argued that before any execution can be carried out, it is necessary to first determine
whether or not Corinthian was negligent in approving the building plan and whether or not it acted in good
faith in doing so. Such determination, according to the Cuasos, will in turn determine whether or not they
24
were in good faith in constructing the house.
The Tanjangcos opposed the Cuasos' application for TRO. They countered that the only pending matter
with this Court is the appeal by Corinthian; hence, the implementation of the January 31, 2003 Decision of
the CA against the Cuasos will not preempt the outcome of the said pending incidents. Also, any action
taken by this Court on Corinthians petition would not benefit the Cuasos for they did not appeal the
adverse decision against them. Accordingly, they cannot obtain affirmative relief from this Court by
reason or on account of the appeal taken by Corinthian. The appeal, they added, is personal to
Corinthian. Finally, they argued that the Cuasos are now estopped from questioning the enforcement of
25
the CA Decision since they issued a managers check to pay the money judgment.
In this Court's Resolution dated July 18, 2007, we denied the Cuasos' application for TRO and/or writ of
preliminary injunction for lack of merit.
The denial was based on sound legal principles. It is axiomatic that to be entitled to the injunctive writ,
one must show that there exists a right to be protected which is directly threatened by the act sought to
be enjoined. Furthermore, there must be a showing that the invasion of the right is material and
substantial, that the right of complainant is clear and unmistakable, and that there is an urgent and
26
paramount necessity for the writ to issue in order to prevent serious damage.
In the Cuasos case, their right to injunctive relief had not been clearly and unmistakably demonstrated.
They failed to show proof that there is material and substantial invasion of their right to warrant the
issuance of an injunctive writ. Indeed, the enforcement of the writ of execution, which would demolish the
Cuasos perimeter fence, is manifestly prejudicial to their interest. However, they possess no clear and
27
unmistakable legal right that merits protection through the writ of preliminary injunction. Their right to
maintain the said fence had been declared inferior to the Tanjangcos right to the demolition of the fence,
after the CA judgment had become final and executory as to the Cuasos.
It bears stressing that the Cuasos failed to appeal the ruling of the CA. This failure to contest the CA
decision before this Court was fatal to their cause. It had the effect of an admission that they indeed acted
in bad faith, as they accepted the CA ruling. The decision of the CA, therefore, became binding and final
28
as to them. As a matter of fact, the CA already issued a partial entry of judgment against the Cuasos.

An injunction to stay a final and executory decision is unavailing except only after a showing that facts
and circumstances exist which would render execution unjust or inequitable, or that a change in the
29
situation of the parties occurred. Here, no such exception exists as shown by the facts earlier narrated.
While it is true that this Court noted the Memorandum and Supplemental Memorandum filed by the
Cuasos, such notation was made only insofar as Corinthian made them respondents in this petition. This
Court cannot grant to the Cuasos any affirmative relief as they did not file a petition questioning the CA
ruling. Consequently, the Decision of the CA holding that the Cuasos acted in bad faith and that the
perimeter fence may now be demolished cannot be put in issue by the Cuasos. It is a fundamental
principle that a party who does not appeal, or file a petition for certiorari, is not entitled to any affirmative
30
relief. An appellee who is not an appellant may assign errors in his brief where his purpose is to
maintain the judgment, but he cannot seek modification or reversal of the judgment or claim affirmative
31
relief unless he has also appealed. This applies to C.B. Paraz and Engr. De Dios who likewise failed to
assail the aforementioned CA Decision.
With this matter put to rest, we now go to the main issues raised by Corinthian, the sole petitioner in this
case, to wit:
a) Whether or not there is legal basis for the Court of Appeals to hold petitioner Corinthian
Gardens Association, Inc. liable to pay 5% of the judgment money to Sps. Tanjangco on account
of the encroachment made by Sps. Cuaso[; and]
b) Whether or not the Court of Appeals has legal basis to increase unilaterally and without proof
the amount prayed for in the Complaint, i.e., P2,000.00, as reasonable compensation for the use
32
and enjoyment of the portion of the lot encroached upon, to P10,000.00.
Corinthian claims that the approval of the building plan of the Cuasos was not tainted with negligence as
it did not approve the survey relocation plan but merely the architectural, structural and sanitary plans for
Cuasos' house; that the purpose of the said approval is not to ensure that the house to be erected on a
particular lot is constructed within its boundaries but only to ensure compliance with the Manual of Rules
and Regulations; that while Corinthian conducts actual site inspections, the inspection and approval of the
building plans are limited to "table inspection" only; that the survey relocation plan was never submitted
for Corinthian's approval; that the acceptance of the builder's bond did not make Corinthian automatically
liable for the encroachment and for damages; and that Corinthian approved the building plan with the
good faith and due diligence required under the circumstances. It, thus, concludes that it cannot be held
liable to pay five
percent (5%) of the money judgment to the Tanjangcos on account of the encroachment made by the
Cuasos. Likewise, it finds no legal basis for the CA to unilaterally increase the amount of the adjudged
rent from P2,000.00 to P10,000.00 which was not prayed for by the Tanjangcos in their complaint and in
33
the absence of evidence adduced by the parties.
On the other hand, the Tanjangcos stand by the ruling of the CA and opine that Corinthian was negligent
in approving the building plan of the Cuasos. They submit that Corinthian's claim that it merely conducts
"table inspections" of buildings further bolsters their argument that Corinthian was negligent in
conveniently and unilaterally restricting and limiting the coverage of its approval, contrary to its own
Manual of Rules and Regulations; that the acceptance of a builder's bond does not automatically make
Corinthian liable but the same affirms the fact that a homeowner can hold it liable for the consequences of
the approval of a building plan; and that Corinthian, by regularly demanding and accepting membership
dues, must be wary of its responsibility to protect the rights and interests of its members. Lastly, the
Tanjangcos contend that a court can take judicial notice of the general increase in the rentals of real
estate, as in this case, where the CA considered the value of their lot in the "posh-and-swank" Corinthian
Gardens Subdivision and the fact that they were deprived of it for almost two decades. The Tanjangcos
34
pray that this Court sustain the ruling of the CA.

The instant case is obviously one for tort, as governed by Article 2176 of the Civil Code, which provides:
ART. 2176. Whoever by act or omission causes damage to another, there being fault or
negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no preexisting contractual relation between the parties, is called a quasi-delict and is governed by the
provisions of this Chapter.
In every tort case filed under this provision, plaintiff has to prove by a preponderance of evidence: (1) the
damages suffered by the plaintiff; (2) the fault or negligence of the defendant or some other person for
whose act he must respond; and (3) the connection of cause and effect between the fault or negligence
35
and the damages incurred.
Undeniably, the perimeter fence of the Cuasos encroached on Lot 69 owned by the Tanjangcos by 87
square meters as duly found by both the RTC and the CA in accordance with the evidence on record. As
a result, the Tanjangcos suffered damage in having been deprived of the use of that portion of their lot
encroached upon. Thus, the primordial issue to be resolved in this case is whether Corinthian was
negligent under the circumstances and, if so, whether such negligence contributed to the injury suffered
by the Tanjangcos.
A negligent act is an inadvertent act; it may be merely carelessly done from a lack of ordinary prudence
and may be one which creates a situation involving an unreasonable risk to another because of the
expectable action of the other, a third person, an animal, or a force of nature. A negligent act is one from
which an ordinary prudent person in the actor's position, in the same or similar circumstances, would
foresee such an appreciable risk of harm to others as to cause him not to do the act or to do it in a more
36
careful manner.
The test to determine the existence of negligence in a particular case may be stated as follows: Did the
defendant in committing the alleged negligent act use that reasonable care and caution which an ordinary
person would have used in the same situation? If not, then he is guilty of negligence. The law, in effect,
adopts the standard supplied by the imaginary conduct of the discreet paterfamilias in Roman law. The
existence of negligence in a given case is not determined by reference to the personal judgment of the
actor in the situation before him. The law considers what would be reckless, blameworthy, or negligent in
37
a man of ordinary intelligence and prudence, and determines liability according to that standard.
By this test, we find Corinthian negligent.
38

While the issue of Corinthian's alleged negligence is factual in character, a review by this Court is
39
proper because the CA's factual findings differ from those of the RTC's. Thus, after a meticulous review
of the evidence on record, we hold that the CA committed no reversible error when it deviated from the
findings of fact of the RTC. The CA's findings and conclusions are substantiated by the evidence on
record and are more in accord with law and reason. Indeed, it is clear that Corinthian failed to exercise
the requisite diligence in insuring that the Cuasos abide by its Manual of Rules and Regulations, thereby
resulting in the encroachment on the Tanjangcos property.
We agree with the CA when it aptly held:
Corinthian cannot and should not be allowed to justify or excuse its negligence by claiming that its
approval of the Cuasos building plans was only limited to a so-called "table inspection;" and not
actual site measurement. To accept some such postulate is to put a premium on negligence.
Corinthian was not organized solely for the defendants Cuasos. It is also the subdivision of the
plaintiffs-spouses Tanjangcos - and of all others who have their dwelling units or abodes therein.
Pertinently, its Manual of Rules and Regulations stipulates in Section 3 thereof (under the
heading Construction), thus:

A. Rules and Regulations

No new construction can be started unless the building plans are approved by the
Association and the appropriate Builders cash bond and pre-construction fees are paid.
The Association will not allow the entry of construction materials and process
identification cards for workers if the above conditions are not complied with. Likewise, all
renovations, repairs, additions and improvements to a finished house except electrical
wiring, will have to be approved by the Association. Water service connection of a
homeowner who undertakes construction work without prior approval of the Association
will be cut-off in addition to the sanctions previously mentioned.
It goes without saying that this Manual of Rules and Regulations applies to all - or it does not
apply at all. To borrow a popular expression, what is sauce for the gander is sauce for the goose or ought to be. To put it matter-of-factly and bluntly, thus, its so-called "table inspection" approval
of the Cuasos building plans is no less of an approval, as approvals come and go. And since it is
an approval tainted with negligence, the necessary and inevitable consequences which law and
justice attach to such negligence must, as a matter of law and justice, also necessarily attach to
Corinthian.
And then again third party defendant-appellee Corinthian Garden required the posting of a
builders cash bond (Exh. 5-Corinthian) from the defendants-appellants Cuasos and the thirdparty defendant C.B. Paraz Construction to secure the performance of their undertaking. Surely,
Corinthian does not imply that while it may take the benefits from the Builders cash bond, it may,
Pilate-like, wash its hands of any responsibility or liability that would or might arise from the
construction or building of the structure for which the cash bond was in the first place posted.
That is not only unjust and immoral, but downright unchristian and iniquitous.
Under the same parity of reasoning, the payment by the appellants-Cuasos to the appellee
Corinthian of pre-construction and membership fees in the Association must necessarily entail the
creation of certain obligations on the part of Corinthian. For duties and responsibilities always go
hand in hand with rights and privileges. That is the law of life - and that is the law of every
civilized society. It is an axiom of equity that he who receives the benefits must share the
40
burdens.
By its Manual of Rules and Regulations, it is reasonable to assume that Corinthian, through its
representative, in the approval of building plans, and in the conduct of periodic inspections of on-going
construction projects within the subdivision, is responsible in insuring compliance with the approved
plans, inclusive of the construction of perimeter walls, which in this case is the subject of dispute between
41
the Tanjangcos and the Cuasos. It is not just or equitable to relieve Corinthian of any liability when, by
its very own rules, it imposes its authority over all its members to the end that "no new construction can
be started unless the plans are approved by the Association and the appropriate cash bond and preconstruction fees are paid." Moreover, Corinthian can impose sanctions for violating these rules. Thus,
the proposition that the inspection is merely a "table inspection" and, therefore, should exempt Corinthian
from liability, is unacceptable. After all, if the supposed inspection is merely a "table inspection" and the
approval granted to every member is a mere formality, then the purpose of the rules would be defeated.
Compliance therewith would not be mandatory, and sanctions imposed for violations could be
disregarded. Corinthian's imprimatur on the construction of the Cuasos' perimeter wall over the property
of the Tanjangcos assured the Cuasos that everything was in order.
In sum, Corinthians failure to prevent the encroachment of the Cuasos perimeter wall into Tanjangcos
property despite the inspection conducted constitutes negligence and, at the very least, contributed to
the injury suffered by the Tanjangcos.
On the second issue, our ruling in Spouses Badillo v. Tayag

42

is instructive:

Citing Sia v. Court of Appeals [272 SCRA 141, May 5, 1997], petitioners argue that the MTC may
take judicial notice of the reasonable rental or the general price increase of land in order to
determine the amount of rent that may be awarded to them. In that case, however, this Court
relied on the CA's factual findings, which were based on the evidence presented before the trial
court. In determining reasonable rent,
the RTC therein took account of the following factors: 1) the realty assessment of the land, 2) the
increase in realty taxes, and 3) the prevailing rate of rentals in the vicinity. Clearly, the trial court
relied, not on mere judicial notice, but on the evidence presented before it.
Indeed, courts may fix the reasonable amount of rent for the use and occupation of a disputed
property. However, petitioners herein erred in assuming that courts, in determining the amount of
rent, could simply rely on their own appreciation of land values without considering any evidence.
As we have said earlier, a court may fix the reasonable amount of rent, but it must still base its
action on the evidence adduced by the parties.
In Herrera v. Bollos [G.R. No. 138258, January 18, 2002], the trial court awarded rent to the
defendants in a forcible entry case. Reversing the RTC, this Court declared that the reasonable
amount of rent could be determined not by mere judicial notice, but by supporting evidence:
x x x A court cannot take judicial notice of a factual matter in controversy. The court may
take judicial notice of matters of public knowledge, or which are capable of
unquestionable demonstration, or ought to be known to judges because of their judicial
functions. Before taking such judicial notice, the court must "allow the parties to be heard
thereon." Hence, there can be no judicial notice on the rental value of the premises in
question without supporting evidence.
Truly, mere judicial notice is inadequate, because evidence is required for a court to determine the proper
rental value. But contrary to Corinthian's arguments, both the RTC and the CA found that indeed rent was
due the Tanjangcos because they were deprived of possession and use of their property. This uniform
factual finding of the RTC and the CA was based on the evidence presented below. Moreover, in
43
Spouses Catungal v. Hao, we considered the increase in the award of rentals as reasonable given the
particular circumstances of each case. We noted therein that the respondent denied the petitioners the
benefits, including rightful possession, of their property for almost a decade.
Similarly, in the instant case, the Tanjangcos were deprived of possession and use of their property for
more than two decades through no fault of their own. Thus, we find no cogent reason to disturb the
monthly rental fixed by the CA.
All told, the CA committed no reversible error.
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals is AFFIRMED. Costs
against petitioner.
SO ORDERED.
ANTONIO EDUARDO B. NACHURA
Associate Justice

ii. Special Circumstances

Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 172200

July 6, 2010

THE HEIRS OF REDENTOR COMPLETO and ELPIDIO ABIAD, Petitioners,

vs.
SGT. AMANDO C. ALBAYDA, JR., Respondent.
DECISION
NACHURA, J.:
Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court, assailing the
1
2
Decision dated January 2, 2006 and the Resolution dated March 30, 2006 of the Court of Appeals (CA)
in CA-G.R. CV No. 68405.
The Facts
The facts of the case are as follows:
Respondent Amando C. Albayda, Jr. (Albayda) is a Master Sergeant of the Philippine Air Force, 527th
Base Security Squadron, 520th Airbase, Philippine Air Force, located at Villamor Air Base (VAB), Pasay
City. Petitioner Redentor Completo (Completo), now represented by his heirs, was the taxi driver of a
3
Toyota Corolla, bearing Plate No. PYD-128, owned and operated by co-petitioner Elpidio Abiad (Abiad).
Albayda and Completo figured in an accident along the intersection of 8th and 11th Streets, VAB.
Albayda filed a complaint for damages before the Regional Trial Court (RTC) of Pasay City. The case was
4
docketed as Civil Case No. 98-1333.
The amended complaint alleged that, on August 27, 1997, while Albayda was on his way to the office to
report for duty, riding a bicycle along 11th Street, the taxi driven by Completo bumped and sideswiped
him, causing serious physical injuries. Albayda was brought to the Philippine Air Force General Hospital
(PAFGH) inside VAB. However, he was immediately transferred to the Armed Forces of the Philippines
Medical Center (AFPMC) on V. Luna Road, Quezon City, because there was a fracture in his left knee
and there was no orthopedic doctor available at PAFGH. From August 27, 1997 until February 11, 1998,
he was confined therein. He was again hospitalized at PAFGH from February 23, 1998 until March 22,
5
1998.
Conciliation between the parties before the barangay failed. Thus, Albayda filed a complaint for physical
injuries through reckless imprudence against Completo before the Office of the City Prosecutor of Pasay
City. On the other hand, Completo filed a counter-charge of damage to property through reckless
6
imprudence against Albayda. On January 13, 1998, the Office of the City Prosecutor issued a resolution,
recommending the filing of an information for reckless imprudence resulting in physical injuries against
7
Completo. The counter-charge of damage to property was recommended dismissed.
The case was raffled to the Metropolitan Trial Court of Pasay City, Branch 45, where Albayda manifested
8
his reservation to file a separate civil action for damages against petitioners Completo and Abiad.

Albayda alleged that the proximate cause of the incident which necessitated his stay in the hospital for
approximately seven (7) months was the negligence of Completo who, at the time of the accident, was in
the employ of Abiad. The pain he suffered required him to undergo medical physiotherapy for a number of
years to regain normality of his left knee joint, and he claimed that he incurred actual damages totaling
Two Hundred Seventy-Six Thousand Five Hundred Fifty Pesos (P276,550.00), inclusive of his anticipated
9
operations.
He further stated that aggravating the physical sufferings, mental anguish, frights, serious anxiety,
besmirched reputation, wounded feelings, moral shock, and social humiliation resulting from his injuries,
his wife abandoned him in May 1998, and left their children in his custody. He thus demanded the amount
of Six Hundred Thousand Pesos (P600,000.00) as moral damages. He likewise asked for exemplary
damages in the amount of Two Hundred Thousand Pesos (P200,000.00) and attorneys fees of Twenty10
Five Thousand Pesos (P25,000.00), plus One Thousand Pesos (P1,000.00) per court appearance.
In his answer to the amended complaint, Completo alleged that, on August 27, 1997, he was carefully
driving the taxicab along 8th Street, VAB, when suddenly he heard a strange sound from the rear right
side of the taxicab. When he stopped to investigate, he found Albayda lying on the road and holding his
11
left leg. He immediately rendered assistance and brought Albayda to PAFGH for emergency treatment.
Completo also asserted that he was an experienced driver who, in accordance with traffic rules and
regulations and common courtesy to his fellow motorists, had already reduced his speed to twenty (20)
kilometers per hour even before reaching the intersection of 8th and 11th Streets. In contrast, Albayda
rode his bicycle at a very high speed, causing him to suddenly lose control of the bicycle and hit the rear
12
door on the right side of the taxicab.
The deep indentation on the rear right door of the taxicab was caused by the impact of Albaydas body
that hit the taxicab after he had lost control of the bicycle; while the slight indentation on the right front
door of the taxicab was caused by the impact of the bike that hit the taxicab after Albayda let go of its
13
handles when he had lost control of it.
Completo maintained that Albayda had no cause of action. The accident and the physical injuries suffered
by Albayda were caused by his own negligence, and his purpose in filing the complaint was to harass
14
petitioners and unjustly enrich himself at their expense.
After submission of the parties respective pleadings, a pretrial conference was held. On December 8,
15
1998, the RTC issued a pretrial order. Thereafter, trial on the merits ensued.
Albayda presented himself, Michael Navarro (Navarro), Dr. Rito Barrosa, Jr. (Dr. Barrosa), Dr. Armando
Sta. Ana, Jr., Dr. Ranny Santiago, (Dr. Santiago), and Dr. Manuel Fidel Magtira (Dr. Magtira) as
16
witnesses in open court.
On direct examination, Navarro testified that, on August 27, 1997, at around 1:45 p.m., he saw a taxicab,
with Plate No. PYD-128, coming from 11th Street, running at an unusual speed. The normal speed should
have been twenty-five (25) kilometers per hour. He was at the corner of 9th and 8th Streets when the
taxicab passed by him. The side of the bicycle was hit by the taxicab at the intersection of 11th and 8th
Streets. He saw Albayda fall to the ground, grimacing in pain. The taxicab at that moment was about ten
(10) meters away from Albayda. On cross-examination, Navarro reiterated that the taxicab was running
quite fast. The bicycle ridden by Albayda reached the intersection of 8th and 11th Streets before the
17
taxicab hit it.
Dr. Santiago, the orthopedic surgeon who treated Albayda when the latter was admitted at AFPMC,
testified that the cause of the injury was "hard impact," and recommended an operation to alleviate the
suffering. On cross-examination, he said that there was a separation of the fragments of the proximal leg,
18
the injured extremity, called levia. They placed the victim on knee traction or calcaneal traction, in order

to avoid further swelling. They bore the calcanean bone with a stainless steel pin so that they could put
five percent (5%) of the body weight of the patient to cool down the leg. He treated Albayda for three (3)
months. He recommended surgery, but the victim had other medical problems, like an increase in sugar
level, and they were waiting for the availability of the implant. The implant was supposed to be placed on
the lateral aspect of the proximal leg or the levia, the part with the separation. It was a long implant with
19
screws.
Dr. Magtira testified that Albayda was readmitted at AFPMC on January 25, 1999 because of complaints
of pain and limitation of motion on the knee joint. Upon evaluation, the pain was caused by traumatic
arthritis brought about by malunion of the lateral trivial condial. An operation of the soft tissue release was
conducted for him to mobilize his knee joint and attain proper range of motion. After the operation,
20
Albayda attained functional range of motion, but because of subsisting pain, they had to do osteoplasty
of the malunion, which was another operation. On cross-examination, Dr. Magtira testified that he
21
rendered free medical service at AFPMC.
Albayda testified that he was thirty-six (36) years old and a soldier of the Armed Forces of the Philippines.
On August 27, 1997, at around 1:40 p.m., he was riding his bike on his way to the office, located on 916
Street, VAB. He had to stop at the corner of 11th and 8th Streets because an oncoming taxicab was
moving fast. However, the taxicab still bumped the front tire of his bike, hit his left knee and threw him off
until he fell down on the road. The taxicab stopped about ten meters away, and then moved backwards.
Its driver, Completo, just stared at him. When somebody shouted to bring him to the hospital, two (2)
persons, one of whom was Dr. Barrosa, helped him and carried him into the taxicab driven by Completo,
22
who brought him to PAFGH.
Upon examination, it was found that Albayda suffered fracture in his left knee and that it required an
operation. No orthopedic doctor was available at PAFGH. Thus, he was transferred that same afternoon
23
to AFPMC, where he was confined until February 11, 1998.
At AFPMC, Albaydas left leg was drilled on and attached to traction. When his leg was drilled, it was so
painful that he had to shout. After his release from the hospital, he continued to suffer pain in his leg. He
underwent reflexology and therapy which offered temporary relief from pain. But after some time, he had
24
to undergo therapy and reflexology again.
On January 25, 1999, Albayda was readmitted at AFPMC and operated on. On June 24, 1999, he was
operated on again. Wire and screw were installed so that he could bend his knee. Nonetheless, he
continued to suffer pain. As of the date of his testimony in court, he was scheduled for another operation
25
in January 2000, when the steel that would be installed in his leg arrives.
For his food, Albayda spent Thirty Pesos (P30.00) each day during his six (6) months of confinement; for
his bed pan, One Thousand Pesos (P1,000.00); for his twice weekly reflexology, Three Hundred Pesos
(P300.00) every session since April 1997; for his caretaker, P300.00 per day for six months. He also
asked for P600,000.00 in moral damages because Completo did not lend him a helping hand, and he
would be suffering deformity for the rest of his life. He demanded P25,000.00 as attorneys fees and
26
P1,000.00 for every court appearance of his lawyer.
On cross-examination, Albayda testified that, on the date of the incident, he was the base guard at VAB,
and his duty was from 2 p.m. to 8 p.m. That afternoon, he was not in a hurry to go to his place of work
because it was only about 1:45 p.m., and his place of work was only six (6) meters away. After the
accident, he was brought to PAFGH, and at 3:00 p.m., he was brought to the AFPMC. When he was
27
discharged from the hospital, he could no longer walk.
Dr. Barrosas testimony during cross-examination emphasized that he was with 2 other persons when he
carried Albayda into the taxicab driven by Completo. He was certain that it was not Completo who carried
the victim into the taxicab. It was only a matter of seconds when he rushed to the scene of the accident.

The taxicab backed up fifteen (15) seconds later. Albayda lay 2 meters away from the corner of 8th and
28
11th Streets.
Completo, Abiad, and Benjamin Panican (Panican) testified for the defense.

29

Completo alleged that he had been employed as taxi driver of FOJS Transport, owned by Abiad, since
February 1997. On August 27, 1997, he was driving the taxicab, with Plate No. PYD-128, from 10:00 a.m.
At around 1:45 p.m., he was on his way home when a bicycle bumped his taxicab at the intersection of
8th and 11th Streets, VAB. The bicycle was travelling from south to north, and he was going east coming
30
from the west. The bicycle was coming from 11th Street, while he was travelling along 8th Street.
On cross-examination, Completo testified that when Albayda hit the rear right door of the taxicab, the
latter fell to the ground. When he heard a noise, he immediately alighted from the taxicab. He denied that
he stopped about 10 meters away from the place where Albayda fell. He carried Albayda and drove him
31
to the hospital.
Panican testified that he worked as an airconditioner technician in a shop located on 8th Street corner
11th Street. On the date and time of the incident, he was working in front of the shop near the roadside.
He saw a bicycle bump the rear right side of the taxicab. Then, the driver of the taxicab alighted, carried
32
Albayda, and brought him to the hospital.
When questioned by the trial court, Panican testified that the bicycle was running fast and that he saw it
bump the taxicab. The taxicab already passed the intersection of 11th and 8th Streets when the bicycle
33
arrived.
Abiad testified that, aside from being a soldier, he was also a franchise holder of taxicabs and passenger
jeepneys. When Completo applied as a driver of the taxicab, Abiad required the former to show his biodata, NBI clearance, and drivers license. Completo never figured in a vehicular accident since the time
he was employed in February 1997. Abiad averred that Completo was a good driver and a good man.
34
Being the operator of taxicab, Abiad would wake up early and personally check all the taxicabs.
On July 31, 2000, the trial court rendered a decision,

35

the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered in favor of the plaintiff [Albayda] and against the defendants
[Completo and Abiad]. Accordingly, the defendants [Completo and Abiad] are hereby ordered to pay the
plaintiff [Albayda] the following sum:
1. P46,000.00 as actual damages;
2. P400,000.00 as moral damages; [and]
3. P25,000.00 as attorneys fees.
Costs against the defendants [Completo and Abiad].
SO ORDERED.

36

Completo and Abiad filed an appeal. The CA affirmed the trial court with modification in a Decision
dated January 2, 2006, viz.:

37

WHEREFORE, premises considered, the appeal is DENIED for lack of merit. The assailed Decision dated
31 July 2000 rendered by the Regional Trial Court of Pasay City, Branch 117, in Civil Case No. 98-1333
is hereby AFFIRMED with the following MODIFICATIONS:

1. the award of Php 46,000.00 as actual damages is DELETED;

2. temperate damages in the amount of Php 40,000.00 is awarded in favor of appellee;
3. moral damages in favor of appellee is REDUCED to Php 200,000.00;
4. appellants Redentor Completo and Elpidio Abiad are solidarily liable to pay appellee Amando
C. Albayda, Jr. said temperate and moral damages, as well as the attorneys fees in the amount
of Php 25,000.00 awarded by the trial court;
5. the temperate and moral damages shall earn legal interest at 6% per annum computed from
the date of promulgation of Our Decision;
6. upon finality of Our Decision, said moral and temperate damages shall earn legal interest at
the rate of 12% per annum, in lieu of 6% per annum, until full payment. Costs against appellants.
SO ORDERED.

38

Hence, this petition.

The Issues
Petitioners presented the following issues for resolution: (1) whether the CA erred in finding that
Completo was the one who caused the collision;
(2) whether Abiad failed to prove that he observed the diligence of a good father of the family; and (3)
39
whether the award of moral and temperate damages and attorneys fees to Albayda had no basis.
The Ruling of the Court
The petition is bereft of merit.
I. On Negligence
The issues raised by petitioners essentially delve into factual matters which were already passed upon by
the RTC and the CA. Conclusions and findings of fact of the trial court are entitled to great weight on
appeal and should not be disturbed unless for strong and cogent reasons, because the trial court is in a
better position to examine real evidence, as well as to observe the demeanor of the witnesses while
testifying in the case. The fact that the CA adopted the findings of fact of the trial court makes the same
40
binding upon this Court. Well-settled is the rule that the Supreme Court is not a trier of facts. To be sure,
findings of fact of lower courts are deemed conclusive and binding upon the Supreme Court, save only for
41
clear and exceptional reasons, none of which is present in the case at bar.
The instant case involved a collision between a taxicab and a bicycle which resulted in serious physical
injuries to the bicycle rider, Albayda. It is a rule in negligence suits that the plaintiff has the burden of
proving by a preponderance of evidence the motorists breach in his duty of care owed to the plaintiff, that
the motorist was negligent in failing to exercise the diligence required to avoid injury to the plaintiff, and
42
that such negligence was the proximate cause of the injury suffered.
Article 2176 of the Civil Code provides that whoever by act or omission causes damage to another, there
being fault or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no

preexisting contractual relation between the parties, is called a quasi-delict. In this regard, the question of
the motorist's negligence is a question of fact.
It was proven by a preponderance of evidence that Completo failed to exercise reasonable diligence in
driving the taxicab because he was over-speeding at the time he hit the bicycle ridden by Albayda. Such
negligence was the sole and proximate cause of the serious physical injuries sustained by Albayda.
Completo did not slow down even when he approached the intersection of 8th and 11th Streets of VAB. It
was also proven that Albayda had the right of way, considering that he reached the intersection ahead of
Completo.
The bicycle occupies a legal position that is at least equal to that of other vehicles lawfully on the
highway, and it is fortified by the fact that usually more will be required of a motorist than a bicyclist in
discharging his duty of care to the other because of the physical advantages the automobile has over the
43
bicycle.
At the slow speed of ten miles per hour, a bicyclist travels almost fifteen feet per second, while a car
traveling at only twenty-five miles per hour covers almost thirty-seven feet per second, and split-second
action may be insufficient to avoid an accident. It is obvious that a motor vehicle poses a greater danger
of harm to a bicyclist than vice versa. Accordingly, while the duty of using reasonable care falls alike on a
motorist and a bicyclist, due to the inherent differences in the two vehicles, more care is required from the
44
motorist to fully discharge the duty than from the bicyclist. Simply stated, the physical advantages that
45
the motor vehicle has over the bicycle make it more dangerous to the bicyclist than vice versa.
Under Article 2180 of the Civil Code, the obligation imposed by Article 2176 is demandable not only for
ones own acts or omissions, but also for those persons for whom one is responsible. Employers shall be
liable for the damages caused by their employees, but the employers responsibility shall cease upon
proof that they observed all the diligence of a good father of the family in the selection and supervision of
their employees.
When an injury is caused by the negligence of an employee, a legal presumption instantly arises that the
employer was negligent. This presumption may be rebutted only by a clear showing on the part of the
employer that he exercised the diligence of a good father of a family in the selection and supervision of
his employee. If the employer successfully overcomes the legal presumption of negligence, he is relieved
46
of liability. In other words, the burden of proof is on the employer.
The trial courts finding that Completo failed to exercise reasonable care to avoid collision with Albayda at
the intersection of 11th and 8th Streets of VAB gives rise to liability on the part of Completo, as driver,
and his employer Abiad. The responsibility of two or more persons who are liable for quasi-delict is
47
solidary. The civil liability of the employer for the negligent acts of his employee is also primary and
48
direct, owing to his own negligence in selecting and supervising his employee. The civil liability of the
49
employer attaches even if the employer is not inside the vehicle at the time of the collision.
In the selection of prospective employees, employers are required to examine them as to their
qualifications, experience, and service records. On the other hand, with respect to the supervision of
employees, employers should formulate standard operating procedures, monitor their implementation,
and impose disciplinary measures for breaches thereof. To establish these factors in a trial involving the
50
issue of vicarious liability, employers must submit concrete proof, including documentary evidence.
Abiad testified that before he hired Completo, he required the latter to show his bio-data, NBI clearance,
and drivers license. Abiad likewise stressed that Completo was never involved in a vehicular accident
prior to the instant case, and that, as operator of the taxicab, he would wake up early to personally check
the condition of the vehicle before it is used.

The protestation of Abiad to escape liability is short of the diligence required under the law. Abiads
evidence consisted entirely of testimonial evidence, and the unsubstantiated and self-serving testimony of
Abiad was insufficient to overcome the legal presumption that he was negligent in the selection and
supervision of his driver.
II. On Damages
The CA rightfully deleted the award of actual damages by the RTC because Albayda failed to present
documentary evidence to establish with certainty the amount that he incurred during his hospitalization
and treatment for the injuries he suffered. In the absence of stipulation, actual damages are awarded only
51
for such pecuniary loss suffered that was duly proved.
While the amount of actual damages was not duly established with certainty, the Court recognizes the
fact that, indeed, Albayda incurred a considerable amount for the necessary and reasonable medical
expenses, loss of salary and wages, loss of capacity to earn increased wages, cost of occupational
therapy, and harm from conditions caused by prolonged immobilization. Temperate damages, more than
nominal but less than compensatory damages, may be recovered when the court finds that some
pecuniary loss has been suffered but its amount cannot, from the nature of the case, be proved with
52
53
certainty. Temperate damages must be reasonable under the circumstances. Thus, the Court finds the
award of One Hundred Thousand Pesos (P100,000.00) as temperate damages reasonable under the
circumstances.
Doubtless, Albayda suffered immeasurable pain because of the incident caused by petitioners
negligence. The CA explained:
The court vicariously feels the pain the plaintiff [Albayda] suffered a number of times. After he was
bumped by defendants cab, he cried in pain. When the doctors bore holes into his left knee, he cried in
pain. When he was tractioned, when he was subjected to an operation after operation he suffered pain.
When he took the witness stand to testify, he walked with crutches, his left knee in bandage, stiff and
54
unfuctional. Pain was written [on] his face. He does deserve moral damages.
Moral damages are awarded in quasi-delicts causing physical injuries. The permanent deformity and the
scar left by the wounds suffered by Albayba will forever be a reminder of the pain and suffering that he
had endured and continues to endure because of petitioners negligence. Thus, the award of moral
damages in the amount of Five Hundred Thousand Pesos (P500,000.00) is proper.
Finally, an interest rate of six percent (6%) per annum is due on the amount of P100,000.00, as
temperate damages, and P500,000.00, as moral damages, which we have awarded. The 6% per annum
interest rate on the temperate and moral damages shall commence to run from the date of the
promulgation of this Decision. Upon finality of the Decision, an interest rate of twelve percent (12%) per
55
annum shall be imposed on the amount of the temperate and moral damages until full payment thereof.
The award of attorneys fees is hereby deleted for failure to prove that petitioners acted in bad faith in
refusing to satisfy respondents just and valid claim.
WHEREFORE, in view of the foregoing, the Decision dated January 2, 2006 and the Resolution dated
March 30, 2006 of the Court of Appeals in CA-G.R. CV No. 68405 are hereby AFFIRMED with
MODIFICATION, viz.:
(1) The estate of the late Redentor Completo and Elpidio Abiad are solidarily liable to pay One
Hundred Thousand Pesos (P100,000.00), as temperate damages, and Five Hundred Thousand
Pesos (P500,000.00), as moral damages;

(2) The temperate and moral damages hereby awarded shall earn legal interest at the rate of six
percent (6%) per annum from the date of the promulgation of this Decision. Upon finality of this
Decision, an interest rate of twelve percent (12%) per annum shall be imposed on the amount of
the temperate and moral damages until full payment thereof.
Costs against petitioners.
SO ORDERED.
ANTONIO EDUARDO B. NACHURA
Associate Justice

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 169467

February 25, 2010

ALFREDO P. PACIS and CLEOPATRA D. PACIS, Petitioners,

vs.
JEROME JOVANNE MORALES, Respondent.
DECISION
CARPIO, J.:
The Case
1

This petition for review assails the 11 May 2005 Decision and the 19 August 2005 Resolution of the
Court of Appeals in CA-G.R. CV No. 60669.
The Facts
On 17 January 1995, petitioners Alfredo P. Pacis and Cleopatra D. Pacis (petitioners) filed with the trial
court a civil case for damages against respondent Jerome Jovanne Morales (respondent). Petitioners are
the parents of Alfred Dennis Pacis, Jr. (Alfred), a 17-year old student who died in a shooting incident
inside the Top Gun Firearms and Ammunitions Store (gun store) in Baguio City. Respondent is the owner
of the gun store.
The facts as found by the trial court are as follows:
On January 19, 1991, Alfred Dennis Pacis, then 17 years old and a first year student at the Baguio
Colleges Foundation taking up BS Computer Science, died due to a gunshot wound in the head which he
sustained while he was at the Top Gun Firearm[s] and Ammunition[s] Store located at Upper Mabini
Street, Baguio City. The gun store was owned and operated by defendant Jerome Jovanne Morales.
With Alfred Pacis at the time of the shooting were Aristedes Matibag and Jason Herbolario. They were
sales agents of the defendant, and at that particular time, the caretakers of the gun store.

The bullet which killed Alfred Dennis Pacis was fired from a gun brought in by a customer of the gun store
for repair.
The gun, an AMT Automag II Cal. 22 Rimfire Magnum with Serial No. SN-H34194 (Exhibit "Q"), was left
by defendant Morales in a drawer of a table located inside the gun store.
Defendant Morales was in Manila at the time. His employee Armando Jarnague, who was the regular
caretaker of the gun store was also not around. He left earlier and requested sales agents Matibag and
Herbolario to look after the gun store while he and defendant Morales were away. Jarnague entrusted to
Matibag and Herbolario a bunch of keys used in the gun store which included the key to the drawer where
the fatal gun was kept.
It appears that Matibag and Herbolario later brought out the gun from the drawer and placed it on top of
the table. Attracted by the sight of the gun, the young Alfred Dennis Pacis got hold of the same. Matibag
asked Alfred Dennis Pacis to return the gun. The latter followed and handed the gun to Matibag. It went
off, the bullet hitting the young Alfred in the head.
A criminal case for homicide was filed against Matibag before branch VII of this Court. Matibag, however,
was acquitted of the charge against him because of the exempting circumstance of "accident" under Art.
12, par. 4 of the Revised Penal Code.
By agreement of the parties, the evidence adduced in the criminal case for homicide against Matibag was
3
reproduced and adopted by them as part of their evidence in the instant case.
On 8 April 1998, the trial court rendered its decision in favor of petitioners. The dispositive portion of the
decision reads:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs [Spouses
Alfredo P. Pacis and Cleopatra D. Pacis] and against the defendant [Jerome Jovanne Morales] ordering
the defendant to pay plaintiffs
(1) P30,000.00 as indemnity for the death of Alfred Pacis;
(2) P29,437.65 as actual damages for the hospitalization and burial expenses incurred by the
plaintiffs;
(3) P100,000.00 as compensatory damages;
(4) P100,000.00 as moral damages;
(5) P50,000.00 as attorneys fees.
SO ORDERED.

Respondent appealed to the Court of Appeals. In its Decision dated 11 May 2005, the Court of Appeals
reversed the trial courts Decision and absolved respondent from civil liability under Article 2180 of the
6
Civil Code.
Petitioners filed a motion for reconsideration, which the Court of Appeals denied in its Resolution dated
19 August 2005.
Hence, this petition.

The Trial Courts Ruling

The trial court held respondent civilly liable for the death of Alfred under Article 2180 in relation to Article
7
2176 of the Civil Code. The trial court held that the accidental shooting of Alfred which caused his death
was partly due to the negligence of respondents employee Aristedes Matibag (Matibag). Matibag and
Jason Herbolario (Herbolario) were employees of respondent even if they were only paid on a
commission basis. Under the Civil Code, respondent is liable for the damages caused by Matibag on the
occasion of the performance of his duties, unless respondent proved that he observed the diligence of a
good father of a family to prevent the damage. The trial court held that respondent failed to observe the
required diligence when he left the key to the drawer containing the loaded defective gun without
instructing his employees to be careful in handling the loaded gun.
The Court of Appeals Ruling
The Court of Appeals held that respondent cannot be held civilly liable since there was no employeremployee relationship between respondent and Matibag. The Court of Appeals found that Matibag was
not under the control of respondent with respect to the means and methods in the performance of his
work. There can be no employer-employee relationship where the element of control is absent. Thus,
Article 2180 of the Civil Code does not apply in this case and respondent cannot be held liable.
Furthermore, the Court of Appeals ruled that even if respondent is considered an employer of Matibag,
still respondent cannot be held liable since no negligence can be attributed to him. As explained by the
Court of Appeals:
Granting arguendo that an employer-employee relationship existed between Aristedes Matibag and the
defendant-appellant, we find that no negligence can be attributed to him.
Negligence is best exemplified in the case of Picart vs. Smith (37 Phil. 809). The test of negligence is this:
"x x x. Could a prudent man, in the position of the person to whom negligence is attributed, foresee harm
to the person injured as a reasonable consequence of the course about to be pursued? If so, the law
imposes a duty on the actor to refrain from that course or take precaution against its mischievous results,
and the failure to do so constitutes negligence. x x x."
Defendant-appellant maintains that he is not guilty of negligence and lack of due care as he did not fail to
observe the diligence of a good father of a family. He submits that he kept the firearm in one of his table
drawers, which he locked and such is already an indication that he took the necessary diligence and care
that the said gun would not be accessible to anyone. He puts [sic] that his store is engaged in selling
firearms and ammunitions. Such items which are per se dangerous are kept in a place which is properly
secured in order that the persons coming into the gun store would not be able to take hold of it unless it is
done intentionally, such as when a customer is interested to purchase any of the firearms, ammunitions
and other related items, in which case, he may be allowed to handle the same.
We agree. Much as We sympathize with the family of the deceased, defendant-appellant is not to be
blamed. He exercised due diligence in keeping his loaded gun while he was on a business trip in Manila.
He placed it inside the drawer and locked it. It was taken away without his knowledge and authority.
8
Whatever happened to the deceased was purely accidental.
The Issues
Petitioners raise the following issues:

I. THE APPELLATE COURT COMMITTED SERIOUS ERROR IN RENDERING THE DECISION AND
RESOLUTION IN QUESTION IN DISREGARD OF LAW AND JURISPRUDENCE BY REVERSING THE
ORDER OF THE REGIONAL TRIAL COURT (BRANCH 59) OF BAGUIO CITY NOTWITHSTANDING
CLEAR, AUTHENTIC RECORDS AND TESTIMONIES PRESENTED DURING THE TRIAL WHICH
NEGATE AND CONTRADICT ITS FINDINGS.
II. THE APPELLATE COURT COMMITTED GRAVE, REVERSIBLE ERROR IN RENDERING THE
DECISION AND RESOLUTION IN QUESTION BY DEPARTING FROM THE ACCEPTED AND USUAL
COURSE OF JUDICIAL PROCEEDINGS THEREBY IGNORING THE FACTUAL FINDINGS OF THE
REGIONAL TRIAL COURT (BRANCH 59) OF BAGUIO CITY SHOWING PETITIONERS CLEAR
9
RIGHTS TO THE AWARD OF DAMAGES.
The Ruling of the Court
We find the petition meritorious.
10

This case for damages arose out of the accidental shooting of petitioners son. Under Article 1161 of the
Civil Code, petitioners may enforce their claim for damages based on the civil liability arising from the
11
crime under Article 100 of the Revised Penal Code or they may opt to file an independent civil action for
damages under the Civil Code. In this case, instead of enforcing their claim for damages in the homicide
case filed against Matibag, petitioners opted to file an independent civil action for damages against
respondent whom they alleged was Matibags employer. Petitioners based their claim for damages under
Articles 2176 and 2180 of the Civil Code.
12

13

Unlike the subsidiary liability of the employer under Article 103 of the Revised Penal Code, the liability
of the employer, or any person for that matter, under Article 2176 of the Civil Code is primary and direct,
based on a persons own negligence. Article 2176 states:
Art. 2176. Whoever by act or omission causes damage to another, there being fault or negligence, is
obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual
relation between the parties, is called quasi-delict and is governed by the provisions of this Chapter.
This case involves the accidental discharge of a firearm inside a gun store.1avvphi1 Under PNP Circular
No. 9, entitled the "Policy on Firearms and Ammunition Dealership/Repair," a person who is in the
business of purchasing and selling of firearms and ammunition must maintain basic security and safety
requirements of a gun dealer, otherwise his License to Operate Dealership will be suspended or
14
canceled.
Indeed, a higher degree of care is required of someone who has in his possession or under his control an
instrumentality extremely dangerous in character, such as dangerous weapons or substances. Such
person in possession or control of dangerous instrumentalities has the duty to take exceptional
15
precautions to prevent any injury being done thereby. Unlike the ordinary affairs of life or business
which involve little or no risk, a business dealing with dangerous weapons requires the exercise of a
higher degree of care.
As a gun store owner, respondent is presumed to be knowledgeable about firearms safety and should
have known never to keep a loaded weapon in his store to avoid unreasonable risk of harm or injury to
others. Respondent has the duty to ensure that all the guns in his store are not loaded. Firearms should
be stored unloaded and separate from ammunition when the firearms are not needed for ready-access
16
defensive use. With more reason, guns accepted by the store for repair should not be loaded precisely
because they are defective and may cause an accidental discharge such as what happened in this case.
Respondent was clearly negligent when he accepted the gun for repair and placed it inside the drawer
without ensuring first that it was not loaded. In the first place, the defective gun should have been stored
in a vault. Before accepting the defective gun for repair, respondent should have made sure that it was

not loaded to prevent any untoward accident. Indeed, respondent should never accept a firearm from
another person, until the cylinder or action is open and he has personally checked that the weapon is
17
completely unloaded. For failing to insure that the gun was not loaded, respondent himself was
negligent. Furthermore, it was not shown in this case whether respondent had a License to Repair which
authorizes him to repair defective firearms to restore its original composition or enhance or upgrade
18
firearms.
Clearly, respondent did not exercise the degree of care and diligence required of a good father of a
family, much less the degree of care required of someone dealing with dangerous weapons, as would
exempt him from liability in this case.
WHEREFORE, we GRANT the petition. We SET ASIDE the 11 May 2005 Decision and the 19 August
2005 Resolution of the Court of Appeals in CA-G.R. CV No. 60669. We REINSTATE the trial courts
Decision dated 8 April 1998.
SO ORDERED.
ANTONIO T. CARPIO
Associate Justice

iii. Children
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-4977

March 22, 1910

DAVID TAYLOR, plaintiff-appellee,

vs.
THE MANILA ELECTRIC RAILROAD AND LIGHT COMPANY, defendant-appellant.
W. H. Lawrence, for appellant.
W. L. Wright, for appellee.
CARSON, J.:
An action to recover damages for the loss of an eye and other injuries, instituted by David Taylor, a minor,
by his father, his nearest relative.
The defendant is a foreign corporation engaged in the operation of a street railway and an electric light
system in the city of Manila. Its power plant is situated at the eastern end of a small island in the Pasig
River within the city of Manila, known as the Isla del Provisor. The power plant may be reached by boat or
by crossing a footbridge, impassable for vehicles, at the westerly end of the island.

The plaintiff, David Taylor, was at the time when he received the injuries complained of, 15 years of age,
the son of a mechanical engineer, more mature than the average boy of his age, and having considerable
aptitude and training in mechanics.
On the 30th of September, 1905, plaintiff, with a boy named Manuel Claparols, about 12 years of age,
crossed the footbridge to the Isla del Provisor, for the purpose of visiting one Murphy, an employee of the
defendant, who and promised to make them a cylinder for a miniature engine. Finding on inquiry that Mr.
Murphy was not in his quarters, the boys, impelled apparently by youthful curiosity and perhaps by the
unusual interest which both seem to have taken in machinery, spent some time in wandering about the
company's premises. The visit was made on a Sunday afternoon, and it does not appear that they saw or
spoke to anyone after leaving the power house where they had asked for Mr. Murphy.
After watching the operation of the travelling crane used in handling the defendant's coal, they walked
across the open space in the neighborhood of the place where the company dumped in the cinders and
ashes from its furnaces. Here they found some twenty or thirty brass fulminating caps scattered on the
ground. These caps are approximately of the size and appearance of small pistol cartridges and each has
attached to it two long thin wires by means of which it may be discharged by the use of electricity. They
are intended for use in the explosion of blasting charges of dynamite, and have in themselves a
considerable explosive power. After some discussion as to the ownership of the caps, and their right to
take them, the boys picked up all they could find, hung them on stick, of which each took end, and carried
them home. After crossing the footbridge, they met a little girl named Jessie Adrian, less than 9 years old,
and all three went to the home of the boy Manuel. The boys then made a series of experiments with the
caps. They trust the ends of the wires into an electric light socket and obtained no result. They next tried
to break the cap with a stone and failed. Manuel looked for a hammer, but could not find one. Then they
opened one of the caps with a knife, and finding that it was filled with a yellowish substance they got
matches, and David held the cap while Manuel applied a lighted match to the contents. An explosion
followed, causing more or less serious injuries to all three. Jessie, who when the boys proposed putting a
match to the contents of the cap, became frightened and started to run away, received a slight cut in the
neck. Manuel had his hand burned and wounded, and David was struck in the face by several particles of
the metal capsule, one of which injured his right eye to such an extent as to the necessitate its removal by
the surgeons who were called in to care for his wounds.
The evidence does definitely and conclusively disclose how the caps came to be on the defendant's
premises, nor how long they had been there when the boys found them. It appears, however, that some
months before the accident, during the construction of the defendant's plant, detonating caps of the same
size and kind as those found by the boys were used in sinking a well at the power plant near the place
where the caps were found; and it also appears that at or about the time when these caps were found,
similarly caps were in use in the construction of an extension of defendant's street car line to Fort William
McKinley. The caps when found appeared to the boys who picked them up to have been lying for a
considerable time, and from the place where they were found would seem to have been discarded as
detective or worthless and fit only to be thrown upon the rubbish heap.
No measures seems to have been adopted by the defendant company to prohibit or prevent visitors from
entering and walking about its premises unattended, when they felt disposed so to do. As admitted in
defendant counsel's brief, "it is undoubtedly true that children in their play sometimes crossed the foot
bridge to the islands;" and, we may add, roamed about at will on the uninclosed premises of the
defendant, in the neighborhood of the place where the caps were found. There is evidence that any effort
ever was made to forbid these children from visiting the defendant company's premises, although it must
be assumed that the company or its employees were aware of the fact that they not infrequently did so.
Two years before the accident, plaintiff spent four months at sea, as a cabin boy on one of the interisland
transports. Later he took up work in his father's office, learning mechanical drawing and mechanical
engineering. About a month after his accident he obtained employment as a mechanical draftsman and
continued in that employment for six months at a salary of P2.50 a day; and it appears that he was a boy

of more than average intelligence, taller and more mature both mentally and physically than most boys of
fifteen.
The facts set out in the foregoing statement are to our mind fully and conclusively established by the
evidence of record, and are substantially admitted by counsel. The only questions of fact which are
seriously disputed are plaintiff's allegations that the caps which were found by plaintiff on defendant
company's premises were the property of the defendant, or that they had come from its possession and
control, and that the company or some of its employees left them exposed on its premises at the point
where they were found.
The evidence in support of these allegations is meager, and the defendant company, apparently relying
on the rule of law which places the burden of proof of such allegations upon the plaintiff, offered no
evidence in rebuttal, and insists that plaintiff failed in his proof. We think, however, that plaintiff's evidence
is sufficient to sustain a finding in accord with his allegations in this regard.
It was proven that caps, similar to those found by plaintiff, were used, more or less extensively, on the
McKinley extension of the defendant company's track; that some of these caps were used in blasting a
well on the company's premises a few months before the accident; that not far from the place where the
caps were found the company has a storehouse for the materials, supplies and so forth, used by it in its
operations as a street railway and a purveyor of electric light; and that the place, in the neighborhood of
which the caps were found, was being used by the company as a sort of dumping ground for ashes and
cinders. Fulminating caps or detonators for the discharge by electricity of blasting charges by dynamite
are not articles in common use by the average citizen, and under all the circumstances, and in the
absence of all evidence to the contrary, we think that the discovery of twenty or thirty of these caps at the
place where they were found by the plaintiff on defendant's premises fairly justifies the inference that the
defendant company was either the owner of the caps in question or had the caps under its possession
and control. We think also that the evidence tends to disclose that these caps or detonators were willfully
and knowingly thrown by the company or its employees at the spot where they were found, with the
expectation that they would be buried out of the sight by the ashes which it was engaged in dumping in
that neighborhood, they being old and perhaps defective; and, however this may be, we are satisfied that
the evidence is sufficient to sustain a finding that the company or some of its employees either willfully or
through an oversight left them exposed at a point on its premises which the general public, including
children at play, where not prohibited from visiting, and over which the company knew or ought to have
known that young boys were likely to roam about in pastime or in play.
Counsel for appellant endeavors to weaken or destroy the probative value of the facts on which these
conclusions are based by intimidating or rather assuming that the blasting work on the company's well
and on its McKinley extension was done by contractors. It was conclusively proven, however, that while
the workman employed in blasting the well was regularly employed by J. G. White and Co., a firm of
contractors, he did the work on the well directly and immediately under the supervision and control of one
of defendant company's foremen, and there is no proof whatever in the record that the blasting on the
McKinley extension was done by independent contractors. Only one witness testified upon this point, and
while he stated that he understood that a part of this work was done by contract, he could not say so of
his own knowledge, and knew nothing of the terms and conditions of the alleged contract, or of the
relations of the alleged contractor to the defendant company. The fact having been proven that detonating
caps were more or less extensively employed on work done by the defendant company's directions and
on its behalf, we think that the company should have introduced the necessary evidence to support its
contention if it wished to avoid the not unreasonable inference that it was the owner of the material used
in these operations and that it was responsible for tortious or negligent acts of the agents employed
therein, on the ground that this work had been intrusted to independent contractors as to whose acts the
maxim respondent superior should not be applied. If the company did not in fact own or make use of caps
such as those found on its premises, as intimated by counsel, it was a very simple matter for it to prove
that fact, and in the absence of such proof we think that the other evidence in the record sufficiently
establishes the contrary, and justifies the court in drawing the reasonable inference that the caps found

on its premises were its property, and were left where they were found by the company or some of its
employees.
Plaintiff appears to have rested his case, as did the trial judge his decision in plaintiff's favor, upon the
provisions of article 1089 of the Civil Code read together with articles 1902, 1903, and 1908 of that code.
ART. 1089 Obligations are created by law, by contracts, by quasi-contracts, and illicit acts and
omissions or by those in which any kind of fault or negligence occurs.
ART. 1902 A person who by an act or omission causes damage to another when there is fault or
negligence shall be obliged to repair the damage so done.
ART. 1903 The obligation imposed by the preceding article is demandable, not only for personal
acts and omissions, but also for those of the persons for whom they should be responsible.
The father, and on his death or incapacity the mother, is liable for the damages caused by the
minors who live with them.
xxx

xxx

xxx

Owners or directors of an establishment or enterprise are equally liable for damages caused by
their employees in the service of the branches in which the latter may be employed or on account
of their duties.
xxx

xxx

xxx

The liability referred to in this article shall cease when the persons mentioned therein prove that
they employed all the diligence of a good father of a family to avoid the damage.
ART. 1908 The owners shall also be liable for the damage caused
1 By the explosion of machines which may not have been cared for with due diligence, and for
kindling of explosive substances which may not have been placed in a safe and proper place.
Counsel for the defendant and appellant rests his appeal strictly upon his contention that the facts proven
at the trial do not established the liability of the defendant company under the provisions of these articles,
and since we agree with this view of the case, it is not necessary for us to consider the various questions
as to form and the right of action (analogous to those raised in the case of Rakes vs. Atlantic, Gulf and
Pacific Co., 7 Phil. Rep., 359), which would, perhaps, be involved in a decision affirming the judgment of
the court below.
We agree with counsel for appellant that under the Civil Code, as under the generally accepted doctrine
in the United States, the plaintiff in an action such as that under consideration, in order to establish his
right to a recovery, must establish by competent evidence:
(1) Damages to the plaintiff.
(2) Negligence by act or omission of which defendant personally, or some person for whose acts
it must respond, was guilty.
(3) The connection of cause and effect between the negligence and the damage.

These proposition are, of course, elementary, and do not admit of discussion, the real difficulty arising in
the application of these principles to the particular facts developed in the case under consideration.
It is clear that the accident could not have happened and not the fulminating caps been left exposed at
the point where they were found, or if their owner had exercised due care in keeping them in an
appropriate place; but it is equally clear that plaintiff would not have been injured had he not, for his own
pleasure and convenience, entered upon the defendant's premises, and strolled around thereon without
the express permission of the defendant, and had he not picked up and carried away the property of the
defendant which he found on its premises, and had he not thereafter deliberately cut open one of the
caps and applied a match to its contents.
But counsel for plaintiff contends that because of plaintiff's youth and inexperience, his entry upon
defendant company's premises, and the intervention of his action between the negligent act of defendant
in leaving the caps exposed on its premises and the accident which resulted in his injury should not be
held to have contributed in any wise to the accident, which should be deemed to be the direct result of
defendant's negligence in leaving the caps exposed at the place where they were found by the plaintiff,
and this latter the proximate cause of the accident which occasioned the injuries sustained by him.
In support of his contention, counsel for plaintiff relies on the doctrine laid down in many of the courts of
last resort in the United States in the cases known as the "Torpedo" and "Turntable" cases, and the cases
based thereon.
In a typical cases, the question involved has been whether a railroad company is liable for an injury
received by an infant of tender years, who from mere idle curiosity, or for the purposes of amusement,
enters upon the railroad company's premises, at a place where the railroad company knew, or had good
reason to suppose, children would be likely to come, and there found explosive signal torpedoes left
unexposed by the railroad company's employees, one of which when carried away by the visitor,
exploded and injured him; or where such infant found upon the premises a dangerous machine, such as a
turntable, left in such condition as to make it probable that children in playing with it would be exposed to
accident or injury therefrom and where the infant did in fact suffer injury in playing with such machine.
In these, and in great variety of similar cases, the great weight of authority holds the owner of the
premises liable.
As laid down in Railroad Co. vs. Stout (17 Wall. (84 U. S.), 657), wherein the principal question was
whether a railroad company was liable for in injury received by an infant while upon its premises, from idle
curiosity, or for purposes of amusement, if such injury was, under circumstances, attributable to the
negligence of the company), the principles on which these cases turn are that "while a railroad company
is not bound to the same degree of care in regard to mere strangers who are unlawfully upon its premises
that it owes to passengers conveyed by it, it is not exempt from responsibility to such strangers for injuries
arising from its negligence or from its tortious acts;" and that "the conduct of an infant of tender years is
not to be judged by the same rule which governs that of adult. While it is the general rule in regard to an
adult that to entitle him to recover damages for an injury resulting from the fault or negligence of another
he must himself have been free from fault, such is not the rule in regard to an infant of tender years. The
care and caution required of a child is according to his maturity and capacity only, and this is to be
determined in each case by the circumstances of the case."
The doctrine of the case of Railroad Company vs. Stout was vigorously controverted and sharply
criticized in several state courts, and the supreme court of Michigan in the case of Ryan vs. Towar (128
Mich., 463) formally repudiated and disapproved the doctrine of the Turntable cases, especially that laid
down in Railroad Company vs. Stout, in a very able decision wherein it held, in the language of the
syllabus: (1) That the owner of the land is not liable to trespassers thereon for injuries sustained by them,
not due to his wanton or willful acts; (2) that no exception to this rule exists in favor of children who are
injured by dangerous machinery naturally calculated to attract them to the premises; (3) that an invitation

or license to cross the premises of another can not be predicated on the mere fact that no steps have
been taken to interfere with such practice; (4) that there is no difference between children and adults as to
the circumstances that will warrant the inference of an invitation or a license to enter upon another's
premises.
Similar criticisms of the opinion in the case of Railroad Company vs. Stout were indulged in by the courts
in Connecticut and Massachusetts. (Nolan vs. Railroad Co., 53 Conn., 461; 154 Mass., 349). And the
doctrine has been questioned in Wisconsin, Pennsylvania, New Hampshire, and perhaps in other States.
On the other hand, many if not most of the courts of last resort in the United States, citing and approving
the doctrine laid down in England in the leading case of Lynch vs. Nurding (1 Q. B., 29, 35, 36), lay down
the rule in these cases in accord with that announced in the Railroad Company vs. Stout (supra), and the
Supreme Court of the United States, in a unanimous opinion delivered by Justice Harlan in the case of
Union Pacific Railway Co. vs. McDonal and reconsidered the doctrine laid down in Railroad Co. vs. Stout,
and after an exhaustive and critical analysis and review of many of the adjudged cases, both English and
American, formally declared that it adhered "to the principles announced in the case of Railroad Co. vs.
Stout."
In the case of Union Pacific Railway Co. vs. MacDonald (supra) the facts were as follows: The plaintiff, a
boy 12 years of age, out of curiosity and for his own pleasure, entered upon and visited the defendant's
premises, without defendant's express permission or invitation, and while there, was by accident injured
by falling into a burning slack pile of whose existence he had no knowledge, but which had been left by
defendant on its premises without any fence around it or anything to give warning of its dangerous
condition, although defendant knew or had reason the interest or curiosity of passers-by. On these facts
the court held that the plaintiff could not be regarded as a mere trespasser, for whose safety and
protection while on the premises in question, against the unseen danger referred to, the defendant was
under no obligation to make provision.
We quote at length from the discussion by the court of the application of the principles involved to the
facts in that case, because what is said there is strikingly applicable in the case at bar, and would seem to
dispose of defendant's contention that, the plaintiff in this case being a trespasser, the defendant
company owed him no duty, and in no case could be held liable for injuries which would not have resulted
but for the entry of plaintiff on defendant's premises.
We adhere to the principles announced in Railroad Co. vs. Stout (supra). Applied to the case now
before us, they require us to hold that the defendant was guilty of negligence in leaving
unguarded the slack pile, made by it in the vicinity of its depot building. It could have forbidden all
persons from coming to its coal mine for purposes merely of curiosity and pleasure. But it did not
do so. On the contrary, it permitted all, without regard to age, to visit its mine, and witness its
operation. It knew that the usual approach to the mine was by a narrow path skirting its slack pit,
close to its depot building, at which the people of the village, old and young, would often
assemble. It knew that children were in the habit of frequenting that locality and playing around
the shaft house in the immediate vicinity of the slack pit. The slightest regard for the safety of
these children would have suggested that they were in danger from being so near a pit, beneath
the surface of which was concealed (except when snow, wind, or rain prevailed) a mass of
burning coals into which a child might accidentally fall and be burned to death. Under all the
circumstances, the railroad company ought not to be heard to say that the plaintiff, a mere lad,
moved by curiosity to see the mine, in the vicinity of the slack pit, was a trespasser, to whom it
owed no duty, or for whose protection it was under no obligation to make provisions.
In Townsend vs. Wathen (9 East, 277, 281) it was held that if a man dangerous traps, baited with
flesh, in his own ground, so near to a highway, or to the premises of another, that dogs passing
along the highway, or kept in his neighbors premises, would probably be attracted by their instinct
into the traps, and in consequence of such act his neighbor's dogs be so attracted and thereby
injured, an action on the case would lie. "What difference," said Lord Ellenborough, C.J., "is there

in reason between drawing the animal into the trap by means of his instinct which he can not
resist, and putting him there by manual force?" What difference, in reason we may observe in this
case, is there between an express license to the children of this village to visit the defendant's
coal mine, in the vicinity of its slack pile, and an implied license, resulting from the habit of the
defendant to permit them, without objection or warning, to do so at will, for purposes of curiosity
or pleasure? Referring it the case of Townsend vs. Wathen, Judge Thompson, in his work on the
Law of Negligence, volume 1, page 305, note, well says: "It would be a barbarous rule of law that
would make the owner of land liable for setting a trap thereon, baited with stinking meat, so that
his neighbor's dog attracted by his natural instinct, might run into it and be killed, and which would
exempt him from liability for the consequence of leaving exposed and unguarded on his land a
dangerous machine, so that his neighbor's child attracted to it and tempted to intermeddle with it
by instincts equally strong, might thereby be killed or maimed for life."
Chief Justice Cooley, voicing the opinion of the supreme court of Michigan, in the case of Powers vs.
Harlow (53 Mich., 507), said that (p. 515):
Children, wherever they go, must be expected to act upon childlike instincts and impulses; and
others who are chargeable with a duty of care and caution toward them must calculate upon this,
and take precautions accordingly. If they leave exposed to the observation of children anything
which would be tempting to them, and which they in their immature judgment might naturally
suppose they were at liberty to handle or play with, they should expect that liberty to be taken.
And the same eminent jurist in his treatise or torts, alluding to the doctrine of implied invitation to visit the
premises of another, says:
In the case of young children, and other persons not fully sui juris, an implied license might
sometimes arise when it would not on behalf of others. Thus leaving a tempting thing for children
to play with exposed, where they would be likely to gather for that purpose, may be equivalent to
an invitation to them to make use of it; and, perhaps, if one were to throw away upon his
premises, near the common way, things tempting to children, the same implication should arise.
(Chap. 10, p. 303.)
The reasoning which led the Supreme Court of the United States to its conclusion in the cases of Railroad
Co. vs. Stout (supra) and Union Pacific Railroad Co. vs. McDonald (supra) is not less cogent and
convincing in this jurisdiction than in that wherein those cases originated. Children here are actuated by
similar childish instincts and impulses. Drawn by curiosity and impelled by the restless spirit of youth,
boys here as well as there will usually be found whenever the public is permitted to congregate. The
movement of machinery, and indeed anything which arouses the attention of the young and inquiring
mind, will draw them to the neighborhood as inevitably as does the magnet draw the iron which comes
within the range of its magnetic influence. The owners of premises, therefore, whereon things attractive to
children are exposed, or upon which the public are expressly or impliedly permitted to enter or upon
which the owner knows or ought to know children are likely to roam about for pastime and in play, " must
calculate upon this, and take precautions accordingly." In such cases the owner of the premises can not
be heard to say that because the child has entered upon his premises without his express permission he
is a trespasser to whom the owner owes no duty or obligation whatever. The owner's failure to take
reasonable precautions to prevent the child from entering his premises at a place where he knows or
ought to know that children are accustomed to roam about of to which their childish instincts and impulses
are likely to attract them is at least equivalent to an implied license to enter, and where the child does
enter under such conditions the owner's failure to take reasonable precautions to guard the child against
injury from unknown or unseen dangers, placed upon such premises by the owner, is clearly a breach of
duty, responsible, if the child is actually injured, without other fault on its part than that it had entered on
the premises of a stranger without his express invitation or permission. To hold otherwise would be
expose all the children in the community to unknown perils and unnecessary danger at the whim of the
owners or occupants of land upon which they might naturally and reasonably be expected to enter.

This conclusion is founded on reason, justice, and necessity, and neither is contention that a man has a
right to do what will with his own property or that children should be kept under the care of their parents or
guardians, so as to prevent their entering on the premises of others is of sufficient weight to put in doubt.
In this jurisdiction as well as in the United States all private property is acquired and held under the tacit
condition that it shall not be so used as to injure the equal rights and interests of the community (see U.
1
S. vs. Toribio, No. 5060, decided January 26, 1910), and except as to infants of very tender years it
would be absurd and unreasonable in a community organized as is that in which we lived to hold that
parents or guardian are guilty of negligence or imprudence in every case wherein they permit growing
boys and girls to leave the parental roof unattended, even if in the event of accident to the child the
negligence of the parent could in any event be imputed to the child so as to deprive it a right to recover in
such cases a point which we neither discuss nor decide.
But while we hold that the entry of the plaintiff upon defendant's property without defendant's express
invitation or permission would not have relieved defendant from responsibility for injuries incurred there by
plaintiff, without other fault on his part, if such injury were attributable to the negligence of the defendant,
we are of opinion that under all the circumstances of this case the negligence of the defendant in leaving
the caps exposed on its premises was not the proximate cause of the injury received by the plaintiff,
which therefore was not, properly speaking, "attributable to the negligence of the defendant," and, on the
other hand, we are satisfied that plaintiffs action in cutting open the detonating cap and putting match to
its contents was the proximate cause of the explosion and of the resultant injuries inflicted upon the
plaintiff, and that the defendant, therefore is not civilly responsible for the injuries thus incurred.
Plaintiff contends, upon the authority of the Turntable and Torpedo cases, that because of plaintiff's youth
the intervention of his action between the negligent act of the defendant in leaving the caps exposed on
its premises and the explosion which resulted in his injury should not be held to have contributed in any
wise to the accident; and it is because we can not agree with this proposition, although we accept the
doctrine of the Turntable and Torpedo cases, that we have thought proper to discuss and to consider that
doctrine at length in this decision. As was said in case of Railroad Co. vs. Stout (supra), "While it is the
general rule in regard to an adult that to entitle him to recover damages for an injury resulting from the
fault or negligence of another he must himself have been free from fault, such is not the rule in regard to
an infant of tender years. The care and caution required of a child is according to his maturity and
capacity only, and this is to be determined in each case by the circumstances of the case." As we think
we have shown, under the reasoning on which rests the doctrine of the Turntable and Torpedo cases, no
fault which would relieve defendant of responsibility for injuries resulting from its negligence can be
attributed to the plaintiff, a well-grown boy of 15 years of age, because of his entry upon defendant's
uninclosed premises without express permission or invitation' but it is wholly different question whether
such youth can be said to have been free from fault when he willfully and deliberately cut open the
detonating cap, and placed a match to the contents, knowing, as he undoubtedly did, that his action
would result in an explosion. On this point, which must be determined by "the particular circumstances of
this case," the doctrine laid down in the Turntable and Torpedo cases lends us no direct aid, although it is
worthy of observation that in all of the "Torpedo" and analogous cases which our attention has been
directed, the record discloses that the plaintiffs, in whose favor judgments have been affirmed, were of
such tender years that they were held not to have the capacity to understand the nature or character of
the explosive instruments which fell into their hands.
In the case at bar, plaintiff at the time of the accident was a well-grown youth of 15, more mature both
mentally and physically than the average boy of his age; he had been to sea as a cabin boy; was able to
earn P2.50 a day as a mechanical draftsman thirty days after the injury was incurred; and the record
discloses throughout that he was exceptionally well qualified to take care of himself. The evidence of
record leaves no room for doubt that, despite his denials on the witness stand, he well knew the explosive
character of the cap with which he was amusing himself. The series of experiments made by him in his
attempt to produce an explosion, as described by the little girl who was present, admit of no other
explanation. His attempt to discharge the cap by the use of electricity, followed by his efforts to explode it
with a stone or a hammer, and the final success of his endeavors brought about by the application of a
match to the contents of the caps, show clearly that he knew what he was about. Nor can there be any

reasonable doubt that he had reason to anticipate that the explosion might be dangerous, in view of the
fact that the little girl, 9 years of age, who was within him at the time when he put the match to the
contents of the cap, became frightened and ran away.
True, he may not have known and probably did not know the precise nature of the explosion which might
be expected from the ignition of the contents of the cap, and of course he did not anticipate the resultant
injuries which he incurred; but he well knew that a more or less dangerous explosion might be expected
from his act, and yet he willfully, recklessly, and knowingly produced the explosion. It would be going far
to say that "according to his maturity and capacity" he exercised such and "care and caution" as might
reasonably be required of him, or that defendant or anyone else should be held civilly responsible for
injuries incurred by him under such circumstances.
The law fixes no arbitrary age at which a minor can be said to have the necessary capacity to understand
and appreciate the nature and consequences of his own acts, so as to make it negligence on his part to
fail to exercise due care and precaution in the commission of such acts; and indeed it would be
impracticable and perhaps impossible so to do, for in the very nature of things the question of negligence
necessarily depends on the ability of the minor to understand the character of his own acts and their
consequences; and the age at which a minor can be said to have such ability will necessarily depends of
his own acts and their consequences; and at the age at which a minor can be said to have such ability will
necessarily vary in accordance with the varying nature of the infinite variety of acts which may be done by
him. But some idea of the presumed capacity of infants under the laws in force in these Islands may be
gathered from an examination of the varying ages fixed by our laws at which minors are conclusively
presumed to be capable of exercising certain rights and incurring certain responsibilities, though it can not
be said that these provisions of law are of much practical assistance in cases such as that at bar, except
so far as they illustrate the rule that the capacity of a minor to become responsible for his own acts varies
with the varying circumstances of each case. Under the provisions of the Penal Code a minor over fifteen
years of age is presumed to be capable of committing a crime and is to held criminally responsible
therefore, although the fact that he is less than eighteen years of age will be taken into consideration as
an extenuating circumstance (Penal Code, arts. 8 and 9). At 10 years of age a child may, under certain
circumstances, choose which parent it prefers to live with (Code of Civil Procedure, sec. 771). At 14 may
petition for the appointment of a guardian (Id., sec. 551), and may consent or refuse to be adopted (Id.,
sec. 765). And males of 14 and females of 12 are capable of contracting a legal marriage (Civil Code, art.
83; G. O., No. 68, sec. 1).
We are satisfied that the plaintiff in this case had sufficient capacity and understanding to be sensible of
the danger to which he exposed himself when he put the match to the contents of the cap; that he was sui
juris in the sense that his age and his experience qualified him to understand and appreciate the
necessity for the exercise of that degree of caution which would have avoided the injury which resulted
from his own deliberate act; and that the injury incurred by him must be held to have been the direct and
immediate result of his own willful and reckless act, so that while it may be true that these injuries would
not have been incurred but for the negligence act of the defendant in leaving the caps exposed on its
premises, nevertheless plaintiff's own act was the proximate and principal cause of the accident which
inflicted the injury.
The rule of the Roman law was: Quod quis ex culpa sua damnum sentit, non intelligitur sentire. (Digest,
book 50, tit. 17 rule 203.)
The Patidas contain the following provisions:
The just thing is that a man should suffer the damage which comes to him through his own fault,
and that he can not demand reparation therefor from another. (Law 25, tit. 5, Partida 3.)
And they even said that when a man received an injury through his own acts the grievance
should be against himself and not against another. (Law 2, tit. 7, Partida 2.)

According to ancient sages, when a man received an injury through his own acts the grievance
should be against himself and not against another. (Law 2, tit. 7 Partida 2.)
And while there does not appear to be anything in the Civil Code which expressly lays down the law
touching contributory negligence in this jurisdiction, nevertheless, the interpretation placed upon its
provisions by the supreme court of Spain, and by this court in the case of Rakes vs. Atlantic, Gulf and
Pacific Co. (7 Phil. Rep., 359), clearly deny to the plaintiff in the case at bar the right to recover damages
from the defendant, in whole or in part, for the injuries sustained by him.
The judgment of the supreme court of Spain of the 7th of March, 1902 (93 Jurisprudencia Civil, 391), is
directly in point. In that case the court said:
According to the doctrine expressed in article 1902 of the Civil Code, fault or negligence is a
source of obligation when between such negligence and the injury there exists the relation of
cause and effect; but if the injury produced should not be the result of acts or omissions of a third
party, the latter has no obligation to repair the same, although such acts or omission were
imprudent or unlawful, and much less when it is shown that the immediate cause of the injury was
the negligence of the injured party himself.
The same court, in its decision of June 12, 1900, said that "the existence of the alleged fault or
negligence is not sufficient without proof that it, and no other cause, gave rise to the damage."
See also judgment of October 21, 1903.
To similar effect Scaevola, the learned Spanish writer, writing under that title in his Jurisprudencia
del Codigo Civil (1902 Anuario, p. 455), commenting on the decision of March 7, 1902 of the Civil
Code, fault or negligence gives rise to an obligation when between it and the damage there exists
the relation of cause and effect; but if the damage caused does not arise from the acts or
omissions of a third person, there is no obligation to make good upon the latter, even though such
acts or omissions be imprudent or illegal, and much less so when it is shown that the immediate
cause of the damage has been the recklessness of the injured party himself.
And again
In accordance with the fundamental principle of proof, that the burden thereof is upon the plaintiff,
it is apparent that it is duty of him who shall claim damages to establish their existence. The
decisions of April 9, 1896, and March 18, July, and September 27, 1898, have especially
supported the principle, the first setting forth in detail the necessary points of the proof, which are
two: An act or omission on the part of the person who is to be charged with the liability, and the
production of the damage by said act or omission.
This includes, by inference, the establishment of a relation of cause or effect between the act or
omission and the damage; the latter must be the direct result of one of the first two. As the
decision of March 22, 1881, said, it is necessary that the damages result immediately and directly
from an act performed culpably and wrongfully; "necessarily presupposing a legal ground for
imputability." (Decision of October 29, 1887.)
Negligence is not presumed, but must be proven by him who alleges it. (Scavoela, Jurisprudencia
del Codigo Civil, vol. 6, pp. 551-552.)
(Cf. decisions of supreme court of Spain of June 12, 1900, and June 23, 1900.)

Finally we think the doctrine in this jurisdiction applicable to the case at bar was definitely settled in this
court in the maturely considered case of Rakes vs. Atlantic, Gulf and Pacific Co. (supra), wherein we held
that while "There are many cases (personal injury cases) was exonerated," on the ground that "the
negligence of the plaintiff was the immediate cause of the casualty" (decisions of the 15th of January, the
19th of February, and the 7th of March, 1902, stated in Alcubilla's Index of that year); none of the cases
decided by the supreme court of Spain "define the effect to be given the negligence of its causes, though
not the principal one, and we are left to seek the theory of the civil law in the practice of other countries;"
and in such cases we declared that law in this jurisdiction to require the application of "the principle of
proportional damages," but expressly and definitely denied the right of recovery when the acts of the
injured party were the immediate causes of the accident.
The doctrine as laid down in that case is as follows:
Difficulty seems to be apprehended in deciding which acts of the injured party shall be considered
immediate causes of the accident. The test is simple. Distinction must be made between the
accident and the injury, between the event itself, without which there could have been no
accident, and those acts of the victim not entering into it, independent of it, but contributing to his
own proper hurt. For instance, the cause of the accident under review was the displacement of
the crosspiece or the failure to replace it. This produces the event giving occasion for damages
that is, the sinking of the track and the sliding of the iron rails. To this event, the act of the plaintiff
in walking by the side of the car did not contribute, although it was an element of the damage
which came to himself. Had the crosspiece been out of place wholly or partly through his act or
omission of duty, that would have been one of the determining causes of the event or accident,
for which he would have been responsible. Where he contributes to the principal occurrence, as
one of its determining factors, he can not recover. Where, in conjunction with the occurrence, he
contributes only to his own injury, he may recover the amount that the defendant responsible for
the event should pay for such injury, less a sum deemed a suitable equivalent for his own
imprudence.
We think it is quite clear that under the doctrine thus stated, the immediate cause of the explosion, the
accident which resulted in plaintiff's injury, was in his own act in putting a match to the contents of the
cap, and that having "contributed to the principal occurrence, as one of its determining factors, he can not
recover."
We have not deemed it necessary to examine the effect of plaintiff's action in picking up upon defendant's
premises the detonating caps, the property of defendant, and carrying the relation of cause and effect
between the negligent act or omission of the defendant in leaving the caps exposed on its premises and
the injuries inflicted upon the plaintiff by the explosion of one of these caps. Under the doctrine of the
Torpedo cases, such action on the part of an infant of very tender years would have no effect in relieving
defendant of responsibility, but whether in view of the well-known fact admitted in defendant's brief that
"boys are snappers-up of unconsidered trifles," a youth of the age and maturity of plaintiff should be
deemed without fault in picking up the caps in question under all the circumstances of this case, we
neither discuss nor decide.
Twenty days after the date of this decision let judgment be entered reversing the judgment of the court
below, without costs to either party in this instance, and ten days thereafter let the record be returned to
the court wherein it originated, where the judgment will be entered in favor of the defendant for the costs
in first instance and the complaint dismissed without day. So ordered.
Arellano, C.J., Torres and Moreland, JJ., concur.
Johnson, J., concurs in the result.

iv. Experts
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-32611

November 3, 1930

CULION ICE, FISH AND ELECTRIC CO., INC., plaintiff-appellee,

vs.
PHILIPPINE MOTORS CORPORATION, defendant-appellant.
Gibbs and McDonough for appellant.
Benj. S. Ohnick for appellee.

STREET, J.:
This action was instituted in the Court of First Instance of Manila by the Culion Ice, Fish & Electric Co.,
Inc., for the purpose of recovering from the Philippine Motors Corporation the sum of P11,350, with
interest and costs. Upon hearing the cause the trial court gave judgment in favor of the plaintiff to recover
of the defendant the sum of P9,850, with interest at 6 per centum per annum from March 24,1927, the
date of the filing of the complaint, until satisfaction of the judgment, with costs. From this judgment the
defendant appealed.
The plaintiff and defendant are domestic corporations; and at the time of the incident with which we are
here concerned, H.D. Cranston was the representative of the plaintiff in the City of Manila. At the same
time the plaintiff was the registered owner of the motor schooner Gwendoline, which was used in the
fishing trade in the Philippine Islands. In January, 1925, Cranston decided, if practicable, to have the
engine on the Gwendoline changed from a gasoline consumer to a crude oil burner, expecting thereby to
effect economy in the cost of running the boat. He therefore made known his desire to McLeod & Co., a
firm dealing in tractors, and was told by Mc Kellar, of said company, that he might make inquiries of the
Philippine Motors Corporations, which had its office on Ongpin Street, in the City of Manila. Cranston
accordingly repaired to the office of the Philippine Motors Corporation and had a conference with C.E.
Quest, its manager, who agreed to do the job, with the understanding that payment should be made upon
completion of the work.
The Philippine Motors Corporation was at this time engaged in business as an automobile agency, but,
under its charter, it had authority to deal in all sorts of machinery engines and motors, as well as to build,
operate, buy and sell the same and the equipment therof. Quest, as general manager, had full charge of
the corporations in all its branches.
As a result of the aforesaid interview, Quest, in company with Cranston, visited the Gwendoline while it
lay at anchor in the Pasig River, and the work of effecting the change in the engine was begun and
conducted under the supervision of Quest, chiefly by a mechanic whom Quest took with him to the boat.
In this work Quest had the assistance of the members of the crew of the Gwendoline, who had been
directed by Cranston to place themselves under Quest's directions.
Upon preliminary inspection of the engine, Quest came to the conclusion that the principal thing
necessary to accomplish the end in view was to install a new carburetor, and a Zenith carburetor was

chosen as the one most adapted to the purpose. After this appliance had been installed, the engine was
tried with gasoline as a fuel, supplied from the tank already in use. The result of this experiment was
satisfactory. The next problem was to introduce into the carburetor the baser fuel, consisting of a low
grade of oil mixed with distillate. For this purpose a temporary tank to contain the mixture was placed on
deck above and at a short distance from the compartment covering the engine. This tank was connected
with the carburetor by a piece of tubing, which was apparently not well fitted at the point where it was
connected with the tank. Owing to this fact the fuel mixture leaked from the tank and dripped sown into
the engine compartment. The new fuel line and that already in use between the gasoline tank and
carburetor were so fixed that it was possible to change from the gasoline fuel to the mixed fuel. The
purpose of this arrangement was to enable the operator to start the engine on gasoline and then, after the
engine had been operating for a few moments, to switch to the new fuel supply. lawphil.net
In the course of the preliminary work upon the carburetor and its connections, it was observed that the
carburetor was flooding, and that the gasoline, or other fuel, was trickling freely from the lower part to the
carburetor to the floor. This fact was called to Quest's attention, but he appeared to think lightly of the
matter and said that, when the engine had gotten to running well, the flooding would disappear.
After preliminary experiments and adjustments had been made the boat was taken out into the bay for a
trial run at about 5 p.m. or a little later, on the evening of January 30,1925. The first part of the course
was covered without any untoward development, other than he fact that the engine stopped a few times,
owing no doubt to the use of an improper mixture of fuel. In the course of the trial Quest remained outside
of the engine compartment and occupied himself with making distillate, with a view to ascertaining what
proportion of the two elements would give best results in the engine.
As the boat was coming in from this run, at about 7:30 p.m. and when passing near Cavite, the engine
stopped, and connection again had to be made with the gasoline line to get a new start. After this had
been done the mechanic, or engineer, switched to the tube connecting with the new mixture. A moment
later a back fire occurred in the cylinder chamber. This caused a flame to shoot back into the carburetor,
and instantly the carburetor and adjacent parts were covered with a mass of flames, which the members
of the crew were unable to subdue. They were therefore compelled, as the fire spread, to take to a boat,
and their escape was safely effected, but the Gwendoline was reduced to a mere hulk. The salvage from,
the wreck, when sold, brought only the sum of P150. The value of the boat, before the accident occured,
as the court found, was P10,000.
A study of the testimony lead us to the conclusion that the loss of this boat was chargeable to the
negligence and lack of skill of Quest. The temporary tank in which the mixture was prepared was
apparently at too great an elevation from the carburetor, with the result that when the fuel line was
opened, the hydrostatic pressure in the carburetor was greater than the delicate parts of the carburetor
could sustain. This was no doubt the cause of the flooding of the carburetor; and the result was that;
when the back fire occurred, the external parts of the carburetor, already saturated with gasoline, burst
into flames, whence the fire was quickly communicated to the highly inflammable material near-by.
Ordinarily a back fire from an engine would not be followed by any disaster, but in this case the leak along
the pipe line and the flooding of the carburetor had created a dangerous situation, which a prudent
mechanic, versed in repairs of this nature, would have taken precautions to avoid. The back fire may
have been due either to the fact that the spark was too advanced or the fuel improperly mixed.
In this connection it must be remembered that when a person holds himself out as being competent to do
things requiring professional skill, he will be held liable for negligence if he fails to exhibit the care and
skill of one ordinarily skilled in the particular work which he attempts to do. The proof shows that Quest
had had ample experience in fixing the engines of automobiles and tractors, but it does not appear that
he was experienced in the doing of similar work on boats. For this reason, possibly the dripping of the
mixture form the tank on deck and the flooding of the carburetor did not convey to his mind an adequate
impression of the danger of fire. But a person skilled in that particular sort of work would, we think have
been sufficiently warned from those circumstances to cause him to take greater and adequate
precautions against the danger. In other words Quest did not use the skill that would have been exhibited

by one ordinarily expert in repairing gasoline engines on boats. There was here, in our opinion, on the
part of Quest, a blameworthy antecedent inadvertence to possible harm, and this constitutes negligence.
The burning of the Gwendoline may be said to have resulted from accident, but this accident was in no
sense an unavoidable accident. It would not have occured but for Quest's carelessness or lack of skill.
The test of liability is not whether the injury was accidental in a sense, but whether Quest was free from
blame.
We therefore see no escape from the conclusion that this accident is chargeable to lack of skill or
negligence in effecting the changes which Quest undertook to accomplish; and even supposing that our
theory as to the exact manner in which the accident occurred might appear to be in some respects
incorrect, yet the origin of the fire in not so inscrutable as to enable us to say that it was casus fortuitus.
The trial judge seems to have proceeded on the idea that, inasmuch as Quest had control of the
Gwendoline during the experimental run, the defendant corporation was in the position of a bailee and
that, as a consequence, the burden of proof was on the defendant to exculpate itself from responsibility
by proving that the accident was not due to the fault of Quest. We are unable to accede to this point of
view. Certainly, Quest was not in charge of the navigation of the boat on this trial run. His employment
contemplated the installation of new parts in the engine only, and it seems rather strained to hold that the
defendant corporation had thereby become bailee of the boat. As a rule workmen who make repairs on a
ship in its owner's yard, or a mechanic who repairs a coach without taking it to his shop, are not bailees,
and their rights and liabilities are determined by the general rules of law, under their contract. The true
bailee acquires possession and what is usually spoken of as special property in the chattel bailed. As a
consequence of such possession and special property, the bailee is given a lien for his compensation.
These ideas seem to be incompatible with the situation now under consideration. But though defendant
cannot be held liable in the supposition that the burden of proof had not been sustained by it in disproving
the negligence of its manager, we are nevertheless of the opinion that the proof shows by a clear
preponderance that the accident to the Gwendoline and the damages resulting therefrom are chargeable
to the negligence or lack of skill of Quest.
This action was instituted about two years after the accident in question had occured, and after Quest had
ceased to be manager of the defendant corporation and had gone back to the United States. Upon these
facts, the defendant bases the contention that the action should be considered stale. It is sufficient reply
to say that the action was brought within the period limited by the statute of limitations and the situation is
not one where the defense of laches can be properly invoked.
It results that the judgment appealed from, awarding damages to the plaintiff in the amount of P9,850,
with interest, must be affirmed; and it is so ordered, with costs against the appellant.
Avancea, C.J., Malcolm, Villamor, Ostrand, Romualdez and Villa-Real, JJ., concur.

e. Negligence as Proximate Cause

i. Definition
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-10126

October 22, 1957

SALUD VILLANUEVA VDA. DE BATACLAN and the minors NORMA, LUZVIMINDA, ELENITA, OSCAR
and ALFREDO BATACLAN, represented by their Natural guardian, SALUD VILLANUEVA VDA. DE
BATACLAN, plaintiffs-appellants,
vs.
MARIANO MEDINA, defendant-appellant.
Lope E. Adriano, Emmanuel Andamo and Jose R. Francisco for plaintiffs-appellants.
Fortunato Jose for defendant and appellant.
MONTEMAYOR, J.:
Shortly after midnight, on September 13, 1952 bus no. 30 of the Medina Transportation, operated by its
owner defendant Mariano Medina under a certificate of public convenience, left the town of Amadeo,
Cavite, on its way to Pasay City, driven by its regular chauffeur, Conrado Saylon. There were about
eighteen passengers, including the driver and conductor. Among the passengers were Juan Bataclan,
seated beside and to the right of the driver, Felipe Lara, sated to the right of Bataclan, another passenger
apparently from the Visayan Islands whom the witnesses just called Visaya, apparently not knowing his
name, seated in the left side of the driver, and a woman named Natalia Villanueva, seated just behind the
four last mentioned. At about 2:00 o'clock that same morning, while the bus was running within the
jurisdiction of Imus, Cavite, one of the front tires burst and the vehicle began to zig-zag until it fell into a
canal or ditch on the right side of the road and turned turtle. Some of the passengers managed to leave
the bus the best way they could, others had to be helped or pulled out, while the three passengers seated
beside the driver, named Bataclan, Lara and the Visayan and the woman behind them named Natalia
Villanueva, could not get out of the overturned bus. Some of the passengers, after they had clambered up
to the road, heard groans and moans from inside the bus, particularly, shouts for help from Bataclan and
Lara, who said they could not get out of the bus. There is nothing in the evidence to show whether or not
the passengers already free from the wreck, including the driver and the conductor, made any attempt to
pull out or extricate and rescue the four passengers trapped inside the vehicle, but calls or shouts for help
were made to the houses in the neighborhood. After half an hour, came about ten men, one of them
carrying a lighted torch made of bamboo with a wick on one end, evidently fueled with petroleum. These
men presumably approach the overturned bus, and almost immediately, a fierce fire started, burning and
all but consuming the bus, including the four passengers trapped inside it. It would appear that as the bus
overturned, gasoline began to leak and escape from the gasoline tank on the side of the chassis,
spreading over and permeating the body of the bus and the ground under and around it, and that the
lighted torch brought by one of the men who answered the call for help set it on fire.
That same day, the charred bodies of the four deemed passengers inside the bus were removed and duly
identified that of Juan Bataclan. By reason of his death, his widow, Salud Villanueva, in her name and in
behalf of her five minor children, brought the present suit to recover from Mariano Medina compensatory,
moral, and exemplary damages and attorney's fees in the total amount of P87,150. After trial, the Court of
First Instance of Cavite awarded P1,000 to the plaintiffs plus P600 as attorney's fee, plus P100, the value
of the merchandise being carried by Bataclan to Pasay City for sale and which was lost in the fire. The
plaintiffs and the defendants appealed the decision to the Court of Appeals, but the latter endorsed the
appeal to us because of the value involved in the claim in the complaint.
Our new Civil Code amply provides for the responsibility of common carrier to its passengers and their
goods. For purposes of reference, we are reproducing the pertinent codal provisions:
ART. 1733. Common carriers, from the nature of their business and for reasons of public policy,
are bound to observe extraordinary diligence in the vigilance over the goods and for the safety of
the passengers transported by them, according to all the circumstances of each case.

Such extraordinary diligence in the vigilance over the goods is further expressed in articles 1734,
1735, and 1745, Nos. 5, 6, and 7, while the extra ordinary diligence for the safety of the
passengers is further set forth in articles 1755 and 1756.
ART. 1755. A common carrier is bound to carry the passengers safely as far as human care and
foresight can provide, using the utmost diligence of very cautious persons, with a due regard for
all the circumstances.
ART. 1756. In case of death of or injuries to passengers, common carriers are presumed to have
been at fault or to have acted negligently, unless they prove that they observed extraordinary
diligence as prescribed in articles 1733 and 1755
ART. 1759. Common carriers are liable for the death of or injuries to passengers through the
negligence or willful acts of the former's employees, although such employees may have acted
beyond the scope of their authority or in violation of the order of the common carriers.
This liability of the common carriers does not cease upon proof that they exercised all the
diligence of a good father of a family in the selection and supervision of their employees.
ART. 1763. A common carrier responsible for injuries suffered by a passenger on account of the
willful acts or negligence of other passengers or of strangers, if the common carrier's employees
through the exercise of the diligence of a good father of a family could have prevented or stopped
the act or omission.
We agree with the trial court that the case involves a breach of contract of transportation for hire, the
Medina Transportation having undertaken to carry Bataclan safely to his destination, Pasay City. We also
agree with the trial court that there was negligence on the part of the defendant, through his agent, the
driver Saylon. There is evidence to show that at the time of the blow out, the bus was speeding, as
testified to by one of the passengers, and as shown by the fact that according to the testimony of the
witnesses, including that of the defense, from the point where one of the front tires burst up to the canal
where the bus overturned after zig-zaging, there was a distance of about 150 meters. The chauffeur, after
the blow-out, must have applied the brakes in order to stop the bus, but because of the velocity at which
the bus must have been running, its momentum carried it over a distance of 150 meters before it fell into
the canal and turned turtle.
There is no question that under the circumstances, the defendant carrier is liable. The only question is to
what degree. The trial court was of the opinion that the proximate cause of the death of Bataclan was not
the overturning of the bus, but rather, the fire that burned the bus, including himself and his copassengers who were unable to leave it; that at the time the fire started, Bataclan, though he must have
suffered physical injuries, perhaps serious, was still alive, and so damages were awarded, not for his
death, but for the physical injuries suffered by him. We disagree. A satisfactory definition of proximate
cause is found in Volume 38, pages 695-696 of American jurisprudence, cited by plaintiffs-appellants in
their brief. It is as follows:
. . . 'that cause, which, in natural and continuous sequence, unbroken by any efficient intervening
cause, produces the injury, and without which the result would not have occurred.' And more
comprehensively, 'the proximate legal cause is that acting first and producing the injury, either
immediately or by setting other events in motion, all constituting a natural and continuous chain of
events, each having a close causal connection with its immediate predecessor, the final event in
the chain immediately effecting the injury as a natural and probable result of the cause which first
acted, under such circumstances that the person responsible for the first event should, as an
ordinary prudent and intelligent person, have reasonable ground to expect at the moment of his
act or default that an injury to some person might probably result therefrom.

It may be that ordinarily, when a passenger bus overturns, and pins down a passenger, merely causing
him physical injuries, if through some event, unexpected and extraordinary, the overturned bus is set on
fire, say, by lightning, or if some highwaymen after looting the vehicle sets it on fire, and the passenger is
burned to death, one might still contend that the proximate cause of his death was the fire and not the
overturning of the vehicle. But in the present case under the circumstances obtaining in the same, we do
not hesitate to hold that the proximate cause was the overturning of the bus, this for the reason that when
the vehicle turned not only on its side but completely on its back, the leaking of the gasoline from the tank
was not unnatural or unexpected; that the coming of the men with a lighted torch was in response to the
call for help, made not only by the passengers, but most probably, by the driver and the conductor
themselves, and that because it was dark (about 2:30 in the morning), the rescuers had to carry a light
with them, and coming as they did from a rural area where lanterns and flashlights were not available;
and what was more natural than that said rescuers should innocently approach the vehicle to extend the
aid and effect the rescue requested from them. In other words, the coming of the men with a torch was to
be expected and was a natural sequence of the overturning of the bus, the trapping of some of its
passengers and the call for outside help. What is more, the burning of the bus can also in part be
attributed to the negligence of the carrier, through is driver and its conductor. According to the witness,
the driver and the conductor were on the road walking back and forth. They, or at least, the driver should
and must have known that in the position in which the overturned bus was, gasoline could and must have
leaked from the gasoline tank and soaked the area in and around the bus, this aside from the fact that
gasoline when spilled, specially over a large area, can be smelt and directed even from a distance, and
yet neither the driver nor the conductor would appear to have cautioned or taken steps to warn the
rescuers not to bring the lighted torch too near the bus. Said negligence on the part of the agents of the
carrier come under the codal provisions above-reproduced, particularly, Articles 1733, 1759 and 1763.
As regard the damages to which plaintiffs are entitled, considering the earning capacity of the deceased,
as well as the other elements entering into a damage award, we are satisfied that the amount of SIX
THOUSAND (P6,000) PESOS would constitute satisfactory compensation, this to include compensatory,
moral, and other damages. We also believe that plaintiffs are entitled to attorney's fees, and assessing
the legal services rendered by plaintiffs' attorneys not only in the trial court, but also in the course of the
appeal, and not losing sight of the able briefs prepared by them, the attorney's fees may well be fixed at
EIGHT HUNDRED (P800) PESOS for the loss of merchandise carried by the deceased in the bus, is
adequate and will not be disturbed.
There is one phase of this case which disturbs if it does not shock us. According to the evidence, one of
the passengers who, because of the injuries suffered by her, was hospitalized, and while in the hospital,
she was visited by the defendant Mariano Medina, and in the course of his visit, she overheard him
speaking to one of his bus inspectors, telling said inspector to have the tires of the bus changed
immediately because they were already old, and that as a matter of fact, he had been telling the driver to
change the said tires, but that the driver did not follow his instructions. If this be true, it goes to prove that
the driver had not been diligent and had not taken the necessary precautions to insure the safety of his
passengers. Had he changed the tires, specially those in front, with new ones, as he had been instructed
to do, probably, despite his speeding, as we have already stated, the blow out would not have occurred.
All in all, there is reason to believe that the driver operated and drove his vehicle negligently, resulting in
the death of four of his passengers, physical injuries to others, and the complete loss and destruction of
their goods, and yet the criminal case against him, on motion of the fiscal and with his consent, was
provisionally dismissed, because according to the fiscal, the witnesses on whose testimony he was
banking to support the complaint, either failed or appear or were reluctant to testify. But the record of the
case before us shows the several witnesses, passengers, in that bus, willingly and unhesitatingly testified
in court to the effect of the said driver was negligent. In the public interest the prosecution of said erring
driver should be pursued, this, not only as a matter of justice, but for the promotion of the safety of
passengers on public utility buses. Let a copy of this decision be furnished the Department of Justice and
the Provincial Fiscal of Cavite.
In view of the foregoing, with the modification that the damages awarded by the trial court are increased
from ONE THOUSAND (P1,000) PESOS TO SIX THOUSAND (P6,000) PESOS, and from SIX

HUNDRED PESOS TO EIGHT HUNDRED (P800) PESOS, for the death of Bataclan and for the
attorney's fees, respectively, the decision appealed is from hereby affirmed, with costs.
Paras, C. J., Bengzon, Padilla, Reyes, A., Bautista Angelo, Labrador, Concepcion, Reyes, J. B. L.,
Endencia, and Felix, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-65295 March 10, 1987
PHOENIX CONSTRUCTION, INC. and ARMANDO U. CARBONEL, petitioners,
vs.
THE INTERMEDIATE APPELLATE COURT and LEONARDO DIONISIO, respondents.

FELICIANO, J:
In the early morning of 15 November 1975 at about 1:30 a.m. private respondent Leonardo Dionisio
was on his way home he lived in 1214-B Zamora Street, Bangkal, Makati from a cocktails-anddinner meeting with his boss, the general manager of a marketing corporation. During the cocktails phase
of the evening, Dionisio had taken "a shot or two" of liquor. Dionisio was driving his Volkswagen car and
had just crossed the intersection of General Lacuna and General Santos Streets at Bangkal, Makati, not
far from his home, and was proceeding down General Lacuna Street, when his car headlights (in his
allegation) suddenly failed. He switched his headlights on "bright" and thereupon he saw a Ford dump
truck looming some 2-1/2 meters away from his car. The dump truck, owned by and registered in the
name of petitioner Phoenix Construction Inc. ("Phoenix"), was parked on the right hand side of General
Lacuna Street (i.e., on the right hand side of a person facing in the same direction toward which Dionisio's
car was proceeding), facing the oncoming traffic. The dump truck was parked askew (not parallel to the
street curb) in such a manner as to stick out onto the street, partly blocking the way of oncoming traffic.
There were no lights nor any so-called "early warning" reflector devices set anywhere near the dump
truck, front or rear. The dump truck had earlier that evening been driven home by petitioner Armando U.
Carbonel, its regular driver, with the permission of his employer Phoenix, in view of work scheduled to be
carried out early the following morning, Dionisio claimed that he tried to avoid a collision by swerving his
car to the left but it was too late and his car smashed into the dump truck. As a result of the collision,
Dionisio suffered some physical injuries including some permanent facial scars, a "nervous breakdown"
and loss of two gold bridge dentures.
Dionisio commenced an action for damages in the Court of First Instance of Pampanga basically claiming
that the legal and proximate cause of his injuries was the negligent manner in which Carbonel had parked
the dump truck entrusted to him by his employer Phoenix. Phoenix and Carbonel, on the other hand,
countered that the proximate cause of Dionisio's injuries was his own recklessness in driving fast at the
time of the accident, while under the influence of liquor, without his headlights on and without a curfew
pass. Phoenix also sought to establish that it had exercised due rare in the selection and supervision of
the dump truck driver.
The trial court rendered judgment in favor of Dionisio and against Phoenix and Carbonel and ordered the
latter:

(1) To pay plaintiff jointly and severally the sum of P 15,000.00 for hospital bills and the
replacement of the lost dentures of plaintiff;
(2) To pay plaintiff jointly and severally the sum of P 1,50,000.-00 as loss of expected
income for plaintiff brought about the accident in controversy and which is the result of
the negligence of the defendants;
(3) To pay the plaintiff jointly and severally the sum of P 10,000. as moral damages for
the unexpected and sudden withdrawal of plaintiff from his lifetime career as a marketing
man; mental anguish, wounded feeling, serious anxiety, social humiliation, besmirched
reputation, feeling of economic insecurity, and the untold sorrows and frustration in life
experienced by plaintiff and his family since the accident in controversy up to the present
time;
(4) To pay plaintiff jointly and severally the sum of P 10,000.00 as damages for the
wanton disregard of defendants to settle amicably this case with the plaintiff before the
filing of this case in court for a smaller amount.
(5) To pay the plaintiff jointly and severally the sum of P 4,500.00 due as and for
attorney's fees; and
(6) The cost of suit. (Emphasis supplied)
Phoenix and Carbonel appealed to the Intermediate Appellate Court. That court in CA-G.R. No. 65476
affirmed the decision of the trial court but modified the award of damages to the following extent:
1. The award of P15,000.00 as compensatory damages was reduced to
P6,460.71, the latter being the only amount that the appellate court found
the plaintiff to have proved as actually sustained by him;
2. The award of P150,000.00 as loss of expected income was reduced to
P100,000.00, basically because Dionisio had voluntarily resigned his job
such that, in the opinion of the appellate court, his loss of income "was
not solely attributable to the accident in question;" and
3. The award of P100,000.00 as moral damages was held by the
appellate court as excessive and unconscionable and hence reduced to
P50,000.00.
The award of P10,000.00 as exemplary damages and P4,500.00 as
attorney's fees and costs remained untouched.
This decision of the Intermediate Appellate Court is now before us on a petition for review.
Both the trial court and the appellate court had made fairly explicit findings of fact relating to the manner
in which the dump truck was parked along General Lacuna Street on the basis of which both courts drew
the inference that there was negligence on the part of Carbonel, the dump truck driver, and that this
negligence was the proximate cause of the accident and Dionisio's injuries. We note, however, that both
courts failed to pass upon the defense raised by Carbonel and Phoenix that the true legal and proximate
cause of the accident was not the way in which the dump truck had been parked but rather the reckless
way in which Dionisio had driven his car that night when he smashed into the dump truck. The
Intermediate Appellate Court in its questioned decision casually conceded that Dionisio was "in some
way, negligent" but apparently failed to see the relevance of Dionisio's negligence and made no further

mention of it. We have examined the record both before the trial court and the Intermediate Appellate
Court and we find that both parties had placed into the record sufficient evidence on the basis of which
the trial court and the appellate court could have and should have made findings of fact relating to the
alleged reckless manner in which Dionisio drove his car that night. The petitioners Phoenix and Carbonel
contend that if there was negligence in the manner in which the dump truck was parked, that negligence
was merely a "passive and static condition" and that private respondent Dionisio's recklessness
constituted an intervening, efficient cause determinative of the accident and the injuries he sustained. The
need to administer substantial justice as between the parties in this case, without having to remand it
back to the trial court after eleven years, compels us to address directly the contention put forward by the
petitioners and to examine for ourselves the record pertaining to Dionisio's alleged negligence which must
bear upon the liability, or extent of liability, of Phoenix and Carbonel.
There are four factual issues that need to be looked into: (a) whether or not private respondent Dionisio
had a curfew pass valid and effective for that eventful night; (b) whether Dionisio was driving fast or
speeding just before the collision with the dump truck; (c) whether Dionisio had purposely turned off his
car's headlights before contact with the dump truck or whether those headlights accidentally
malfunctioned moments before the collision; and (d) whether Dionisio was intoxicated at the time of the
accident.
As to the first issue relating to the curfew pass, it is clear that no curfew pass was found on the person of
Dionisio immediately after the accident nor was any found in his car. Phoenix's evidence here consisted
of the testimony of Patrolman Cuyno who had taken Dionisio, unconscious, to the Makati Medical Center
for emergency treatment immediately after the accident. At the Makati Medical Center, a nurse took off
Dionisio's clothes and examined them along with the contents of pockets together with Patrolman Cuyno.
1 Private respondent Dionisio was not able to produce any curfew pass during the trial. Instead, he
offered the explanation that his family may have misplaced his curfew pass. He also offered a certification
(dated two years after the accident) issued by one Major Benjamin N. Libarnes of the Zone Integrated
Police Intelligence Unit of Camp Olivas, San Fernando, Pampanga, which was said to have authority to
issue curfew passes for Pampanga and Metro Manila. This certification was to the effect that private
respondent Dionisio had a valid curfew pass. This certification did not, however, specify any pass serial
number or date or period of effectivity of the supposed curfew pass. We find that private respondent
Dionisio was unable to prove possession of a valid curfew pass during the night of the accident and that
the preponderance of evidence shows that he did not have such a pass during that night. The relevance
of possession or non-possession of a curfew pass that night lies in the light it tends to shed on the other
related issues: whether Dionisio was speeding home and whether he had indeed purposely put out his
headlights before the accident, in order to avoid detection and possibly arrest by the police in the nearby
police station for travelling after the onset of curfew without a valid curfew pass.
On the second issue whether or not Dionisio was speeding home that night both the trial court and
the appellate court were completely silent.
The defendants in the trial court introduced the testimony of Patrolman Cuyno who was at the scene of
the accident almost immediately after it occurred, the police station where he was based being barely 200
meters away. Patrolman Cuyno testified that people who had gathered at the scene of the accident told
2
him that Dionisio's car was "moving fast" and did not have its headlights on. Dionisio, on the other hand,
claimed that he was travelling at a moderate speed at 30 kilometers per hour and had just crossed the
intersection of General Santos and General Lacuna Streets and had started to accelerate when his
3
headlights failed just before the collision took place.
Private respondent Dionisio asserts that Patrolman Cuyno's testimony was hearsay and did not fag within
any of the recognized exceptions to the hearsay rule since the facts he testified to were not acquired by
him through official information and had not been given by the informants pursuant to any duty to do so.
Private respondent's objection fails to take account of the fact that the testimony of Patrolman Cuyno is
4
admissible not under the official records exception to the hearsay rule but rather as part of the res
5
gestae. Testimonial evidence under this exception to the hearsay rule consists of excited utterances

made on the occasion of an occurrence or event sufficiently startling in nature so as to render inoperative
the normal reflective thought processes of the observer and hence made as a spontaneous reaction to
6
the occurrence or event, and not the result of reflective thought.
We think that an automobile speeding down a street and suddenly smashing into a stationary object in
the dead of night is a sufficiently startling event as to evoke spontaneous, rather than reflective, reactions
from observers who happened to be around at that time. The testimony of Patrolman Cuyno was
therefore admissible as part of the res gestae and should have been considered by the trial court. Clearly,
substantial weight should have been ascribed to such testimony, even though it did not, as it could not,
have purported to describe quantitatively the precise velocity at winch Dionisio was travelling just before
impact with the Phoenix dump truck.
A third related issue is whether Dionisio purposely turned off his headlights, or whether his headlights
accidentally malfunctioned, just moments before the accident. The Intermediate Appellate Court
expressly found that the headlights of Dionisio's car went off as he crossed the intersection but was noncommittal as to why they did so. It is the petitioners' contention that Dionisio purposely shut off his
headlights even before he reached the intersection so as not to be detected by the police in the police
precinct which he (being a resident in the area) knew was not far away from the intersection. We believe
that the petitioners' theory is a more credible explanation than that offered by private respondent Dionisio
i.e., that he had his headlights on but that, at the crucial moment, these had in some mysterious if
convenient way malfunctioned and gone off, although he succeeded in switching his lights on again at
"bright" split seconds before contact with the dump truck.
A fourth and final issue relates to whether Dionisio was intoxicated at the time of the accident. The
evidence here consisted of the testimony of Patrolman Cuyno to the effect that private respondent
Dionisio smelled of liquor at the time he was taken from his smashed car and brought to the Makati
7
Medical Center in an unconscious condition. This testimony has to be taken in conjunction with the
admission of Dionisio that he had taken "a shot or two" of liquor before dinner with his boss that night. We
do not believe that this evidence is sufficient to show that Dionisio was so heavily under the influence of
8
liquor as to constitute his driving a motor vehicle per se an act of reckless imprudence. There simply is
not enough evidence to show how much liquor he had in fact taken and the effects of that upon his
physical faculties or upon his judgment or mental alertness. We are also aware that "one shot or two" of
hard liquor may affect different people differently.
The conclusion we draw from the factual circumstances outlined above is that private respondent Dionisio
was negligent the night of the accident. He was hurrying home that night and driving faster than he should
have been. Worse, he extinguished his headlights at or near the intersection of General Lacuna and
General Santos Streets and thus did not see the dump truck that was parked askew and sticking out onto
the road lane.
Nonetheless, we agree with the Court of First Instance and the Intermediate Appellate Court that the legal
and proximate cause of the accident and of Dionisio's injuries was the wrongful or negligent manner in
which the dump truck was parked in other words, the negligence of petitioner Carbonel. That there was a
reasonable relationship between petitioner Carbonel's negligence on the one hand and the accident and
respondent's injuries on the other hand, is quite clear. Put in a slightly different manner, the collision of
Dionisio's car with the dump truck was a natural and foreseeable consequence of the truck driver's
negligence.
The petitioners, however, urge that the truck driver's negligence was merely a "passive and static
condition" and that private respondent Dionisio's negligence was an "efficient intervening cause and that
consequently Dionisio's negligence must be regarded as the legal and proximate cause of the accident
rather than the earlier negligence of Carbonel. We note that the petitioners' arguments are drawn from a
reading of some of the older cases in various jurisdictions in the United States but we are unable to
persuade ourselves that these arguments have any validity for our jurisdiction. We note, firstly, that even

in the United States, the distinctions between "cause" and "condition" which the 'petitioners would have
us adopt have already been "almost entirely discredited." Professors and Keeton make this quite clear:
Cause and condition. Many courts have sought to distinguish between the active "cause"
of the harm and the existing "conditions" upon which that cause operated. If the
defendant has created only a passive static condition which made the damage possible,
the defendant is said not to be liable. But so far as the fact of causation is concerned, in
the sense of necessary antecedents which have played an important part in producing
the result it is quite impossible to distinguish between active forces and passive
situations, particularly since, as is invariably the case, the latter are the result of other
active forces which have gone before. The defendant who spills gasoline about the
premises creates a "condition," but the act may be culpable because of the danger of fire.
When a spark ignites the gasoline, the condition has done quite as much to bring about
the fire as the spark; and since that is the very risk which the defendant has created, the
defendant will not escape responsibility. Even the lapse of a considerable time during
which the "condition" remains static will not necessarily affect liability; one who digs a
trench in the highway may still be liable to another who fans into it a month afterward.
"Cause" and "condition" still find occasional mention in the decisions; but the distinction is
now almost entirely discredited. So far as it has any validity at all, it must refer to the type
of case where the forces set in operation by the defendant have come to rest in a position
of apparent safety, and some new force intervenes. But even in such cases, it is not the
distinction between "cause" and "condition" which is important but the nature of the risk
9
and the character of the intervening cause.
We believe, secondly, that the truck driver's negligence far from being a "passive and static condition"
was rather an indispensable and efficient cause. The collision between the dump truck and the private
respondent's car would in an probability not have occurred had the dump truck not been parked askew
without any warning lights or reflector devices. The improper parking of the dump truck created an
unreasonable risk of injury for anyone driving down General Lacuna Street and for having so created this
risk, the truck driver must be held responsible. In our view, Dionisio's negligence, although later in point of
time than the truck driver's negligence and therefore closer to the accident, was not an efficient
intervening or independent cause. What the Petitioners describe as an "intervening cause" was no more
than a foreseeable consequent manner which the truck driver had parked the dump truck. In other words,
the petitioner truck driver owed a duty to private respondent Dionisio and others similarly situated not to
impose upon them the very risk the truck driver had created. Dionisio's negligence was not of an
independent and overpowering nature as to cut, as it were, the chain of causation in fact between the
improper parking of the dump truck and the accident, nor to sever the juris vinculum of liability. It is helpful
to quote once more from Professor and Keeton:
Foreseeable Intervening Causes. If the intervening cause is one which in ordinary human
experience is reasonably to be anticipated or one which the defendant has reason to
anticipate under the particular circumstances, the defendant may be negligence among
other reasons, because of failure to guard against it; or the defendant may be negligent
only for that reason. Thus one who sets a fire may be required to foresee that an
ordinary, usual and customary wind arising later wig spread it beyond the defendant's
own property, and therefore to take precautions to prevent that event. The person who
leaves the combustible or explosive material exposed in a public place may foresee the
risk of fire from some independent source. ... In all of these cases there is an intervening
cause combining with the defendant's conduct to produce the result and in each case the
defendant's negligence consists in failure to protect the plaintiff against that very risk.
Obviously the defendant cannot be relieved from liability by the fact that the risk or a
substantial and important part of the risk, to which the defendant has subjected the
plaintiff has indeed come to pass. Foreseeable intervening forces are within the scope
original risk, and hence of the defendant's negligence. The courts are quite generally

agreed that intervening causes which fall fairly in this category will not supersede the
defendant's responsibility.
Thus it has been held that a defendant will be required to anticipate the usual weather of
the vicinity, including all ordinary forces of nature such as usual wind or rain, or snow or
frost or fog or even lightning; that one who leaves an obstruction on the road or a railroad
track should foresee that a vehicle or a train will run into it; ...
The risk created by the defendant may include the intervention of the foreseeable
negligence of others. ... [The standard of reasonable conduct may require the defendant
to protect the plaintiff against 'that occasional negligence which is one of the ordinary
incidents of human life, and therefore to be anticipated.' Thus, a defendant who blocks
the sidewalk and forces the plaintiff to walk in a street where the plaintiff will be exposed
to the risks of heavy traffic becomes liable when the plaintiff is run down by a car, even
though the car is negligently driven; and one who parks an automobile on the highway
without lights at night is not relieved of responsibility when another negligently drives into
it. --- 10
We hold that private respondent Dionisio's negligence was "only contributory," that the "immediate and
proximate cause" of the injury remained the truck driver's "lack of due care" and that consequently
respondent Dionisio may recover damages though such damages are subject to mitigation by the courts
(Article 2179, Civil Code of the Philippines).
Petitioners also ask us to apply what they refer to as the "last clear chance" doctrine. The theory here of
petitioners is that while the petitioner truck driver was negligent, private respondent Dionisio had the "last
clear chance" of avoiding the accident and hence his injuries, and that Dionisio having failed to take that
"last clear chance" must bear his own injuries alone. The last clear chance doctrine of the common law
was imported into our jurisdiction by Picart vs. Smith 11 but it is a matter for debate whether, or to what
extent, it has found its way into the Civil Code of the Philippines. The historical function of that doctrine in
the common law was to mitigate the harshness of another common law doctrine or rule that of
contributory negligence. 12 The common law rule of contributory negligence prevented any recovery at all
by a plaintiff who was also negligent, even if the plaintiff's negligence was relatively minor as compared
with the wrongful act or omission of the defendant. 13 The common law notion of last clear chance
permitted courts to grant recovery to a plaintiff who had also been negligent provided that the defendant
had the last clear chance to avoid the casualty and failed to do so. 14 Accordingly, it is difficult to see
what role, if any, the common law last clear chance doctrine has to play in a jurisdiction where the
common law concept of contributory negligence as an absolute bar to recovery by the plaintiff, has itself
been rejected, as it has been in Article 2179 of the Civil Code of the Philippines. 15
Is there perhaps a general concept of "last clear chance" that may be extracted from its common law
matrix and utilized as a general rule in negligence cases in a civil law jurisdiction like ours? We do not
believe so. Under Article 2179, the task of a court, in technical terms, is to determine whose negligence
the plaintiff's or the defendant's was the legal or proximate cause of the injury. That task is not
simply or even primarily an exercise in chronology or physics, as the petitioners seem to imply by the use
of terms like "last" or "intervening" or "immediate." The relative location in the continuum of time of the
plaintiff's and the defendant's negligent acts or omissions, is only one of the relevant factors that may be
taken into account. Of more fundamental importance are the nature of the negligent act or omission of
each party and the character and gravity of the risks created by such act or omission for the rest of the
community. The petitioners urge that the truck driver (and therefore his employer) should be absolved
from responsibility for his own prior negligence because the unfortunate plaintiff failed to act with that
increased diligence which had become necessary to avoid the peril precisely created by the truck driver's
own wrongful act or omission. To accept this proposition is to come too close to wiping out the
fundamental principle of law that a man must respond for the forseeable consequences of his own
negligent act or omission. Our law on quasi-delicts seeks to reduce the risks and burdens of living in

society and to allocate them among the members of society. To accept the petitioners' pro-position must
tend to weaken the very bonds of society.
Petitioner Carbonel's proven negligence creates a presumption of negligence on the part of his employer
Phoenix 16 in supervising its employees properly and adequately. The respondent appellate court in
effect found, correctly in our opinion, that Phoenix was not able to overcome this presumption of
negligence. The circumstance that Phoenix had allowed its truck driver to bring the dump truck to his
home whenever there was work to be done early the following morning, when coupled with the failure to
show any effort on the part of Phoenix to supervise the manner in which the dump truck is parked when
away from company premises, is an affirmative showing of culpa in vigilando on the part of Phoenix.
Turning to the award of damages and taking into account the comparative negligence of private
respondent Dionisio on one hand and petitioners Carbonel and Phoenix upon the other hand, 17 we
believe that the demands of substantial justice are satisfied by allocating most of the damages on a 20-80
ratio. Thus, 20% of the damages awarded by the respondent appellate court, except the award of
P10,000.00 as exemplary damages and P4,500.00 as attorney's fees and costs, shall be borne by private
respondent Dionisio; only the balance of 80% needs to be paid by petitioners Carbonel and Phoenix who
shall be solidarity liable therefor to the former. The award of exemplary damages and attorney's fees and
costs shall be borne exclusively by the petitioners. Phoenix is of course entitled to reimbursement from
Carbonel. 18 We see no sufficient reason for disturbing the reduced award of damages made by the
respondent appellate court.
WHEREFORE, the decision of the respondent appellate court is modified by reducing the aggregate
amount of compensatory damages, loss of expected income and moral damages private respondent
Dionisio is entitled to by 20% of such amount. Costs against the petitioners.
SO ORDERED.
Yap (Chairman), Narvasa, Cruz, Gancayco and Sarmiento, JJ., concur.
Melencio-Herrera, J., is on leave.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 92087 May 8, 1992

SOFIA FERNANDO, in her behalf and as the legal guardian of her minor children, namely:
ALBERTO & ROBERTO, all surnamed FERNANDO, ANITA GARCIA, NICOLAS LIAGOSO, ROSALIA
BERTULANO, in her behalf and as the legal guardian of her minor children, namely: EDUARDO,
ROLANDO, DANIEL, AND JOCELYN, all surnamed BERTULANO, PRIMITIVA FAJARDO in her
behalf and as legal guardian of her minor children, namely: GILBERT, GLEN, JOCELYN AND
JOSELITO, all surnamed FAJARDO, and EMETERIA LIAGOSO, in her behalf and as guardian ad
litem, of her minor grandchildren, namely: NOEL, WILLIAM, GENEVIEVE and GERRY, all
surnamed LIAGOSO, petitioners,
vs.
THE HONORABLE COURT OF APPEALS AND CITY OF DAVAO, respondents.

MEDIALDEA, J.:
This is a petition for review on certiorari praying that the amended decision of the Court of Appeals dated
January 11, 1990 in CA-G.R. No. C.V. 04846, entitled "Sofia Fernando, etc., et al. v. The City of Davao,"
be reversed and that its original decision dated January 31, 1986 be reinstated subject to the modification
sought by the petitioners in their motion for partial reconsideration dated March 6, 1986.
The antecedent facts are briefly narrated by the trial court, as follows:
From the evidence presented we see the following facts: On November 7, 1975, Bibiano
Morta, market master of the Agdao Public Market filed a requisition request with the Chief
of Property of the City Treasurer's Office for the re-emptying of the septic tank in Agdao.
An invitation to bid was issued to Aurelio Bertulano, Lito Catarsa, Feliciano Bascon,
Federico Bolo and Antonio Suer, Jr. Bascon won the bid. On November 26, 1975
Bascon was notified and he signed the purchase order. However, before such date,
specifically on November 22, 1975, bidder Bertulano with four other companions namely
Joselito Garcia, William Liagoso, Alberto Fernando and Jose Fajardo, Jr. were found
dead inside the septic tank. The bodies were removed by a fireman. One body, that of
Joselito Garcia, was taken out by his uncle, Danilo Garcia and taken to the Regional
Hospital but he expired there. The City Engineer's office investigated the case and
learned that the five victims entered the septic tank without clearance from it nor with the
knowledge and consent of the market master. In fact, the septic tank was found to be
almost empty and the victims were presumed to be the ones who did the re-emptying. Dr.
Juan Abear of the City Health Office autopsied the bodies and in his reports, put the
cause of death of all five victims as "asphyxia" caused by the diminution of oxygen supply
in the body working below normal conditions. The lungs of the five victims burst, swelled
in hemmorrhagic areas and this was due to their intake of toxic gas, which, in this case,
was sulfide gas produced from the waste matter inside the septic tank. (p. 177, Records)
On August 28, 1984, the trial court rendered a decision, the dispositive portion of which reads:
IN VIEW OF THE FOREGOING, this case is hereby DISMISSED without pronouncement
as to costs.
SO ORDERED. (Records, p. 181)
From the said decision, the petitioners appealed to the then Intermediate Appellate Court (now Court of
Appeals). On January 3, 1986, the appellate court issued a decision, the dispositive portion of which
reads:
WHEREFORE, in view of the facts fully established and in the liberal interpretation of
what the Constitution and the law intended to protect the plight of the poor and the needy,
the ignorant and the
indigent more entitled to social justice for having, in the unforgettable words of
Magsaysay, "less in life," We hereby reverse and set aside the appealed judgment and
render another one:
1. Ordering the defendant to pay to the plaintiffs Dionisio Fernando, Sofia Fernando and
her minor children the following sums of money:
a) Compensatory damages for his death P30,000.00

b) Moral damages P20,000.00

2. Ordering the defendant to pay to the plaintiffs David Garcia and Anita Garcia the
following sums of money:
a) Compensatory damages for his death P30,000.00
b) Moral damages P20,000.00
3. Ordering the defendant to pay to the plaintiff Rosalia Bertulano (sic) and her minor
children the following sums of money
a) Compensatory damages for his death P30,000.00
b) Moral damages P20,000.00
4. Ordering the defendant to pay to the plaintiff Primitiva Fajardo and her minor children
the following sums of money:
a) Compensatory damages for his death P30,000.00
b) Moral damages P20,000.00
5. Ordering the defendant to pay to the plaintiffs Norma Liagoso, Nicolas Liagoso and
Emeteria Liagoso and her minor grandchildren the following sums of money:
a) Compensatory damages for his death P30,000.00
b) Moral damages P20,000.00
The death compensation is fixed at P30,000.00 in accordance with the rulings of the
Supreme Court starting with People vs. De la Fuente, Nos. L-63251-52, December 29,
1983, 126 SCRA 518 reiterated in the recent case of People vs. Nepomuceno, No. L41412, May 27, 1985. Attorney's fees in the amount of P10,000.00 for the handling of the
case for the 5 victims is also awarded.
No pronouncement as to costs.
SO ORDERED. (Rollo, pp. 33-34)
Both parties filed their separate motions for reconsideration. On January 11, 1990, the Court of Appeals
rendered an Amended Decision, the dispositive portion of which reads:
WHEREFORE, finding merit in the motion for reconsideration of the defendant-appellee
Davao City, the same is hereby GRANTED. The decision of this Court dated January 31,
1986 is reversed and set aside and another one is hereby rendered dismissing the case.
No pronouncement as to costs.
SO ORDERED. (Rollo, p. 25)
Hence, this petition raising the following issues for resolution:

1. Is the respondent Davao City guilty of negligence in the case at bar?

2. If so, is such negligence the immediate and proximate cause of deaths of the victims
hereof? (p. 72, Rollo)
Negligence has been defined as the failure to observe for the protection of the interests of another person
that degree of care, precaution, and vigilance which the circumstances justly demand, whereby such
other person suffers injury (Corliss v. Manila Railroad Company, L-21291, March 28, 1969, 27 SCRA 674,
680). Under the law, a person who by his omission causes damage to another, there being negligence, is
obliged to pay for the damage done (Article 2176, New Civil Code). As to what would constitute a
negligent act in a given situation, the case of Picart v. Smith (37 Phil. 809, 813) provides Us the answer,
to wit:
The test by which to determine the existence of negligence in a particular case may be
stated as follows: Did the defendant in doing the alleged negligent act use that
reasonable care and caution which an ordinarily prudent person would have used in the
same situation? If not, then he is guilty of negligence. The law here in effect adopts the
standard supposed to be supplied by the imaginary conduct of the discreet pater familias
of the Roman law. The existence of negligence in a given case is not determined by
reference to the personal judgment of the actor in the situation before him. The law
considers what would be reckless, blameworthy, or negligent in the man of ordinary
intelligence and prudence and determines liability by that.
The question as to what would constitute the conduct of a prudent man in a given
situation must of course be always determined in the light of human experience and in
view of the facts involved in the particular case. Abstract speculation cannot here be of
much value but this much can be profitably said: Reasonable men govern their conduct
by the circumstances which are before them or known to them. They are not, and are not
supposed to be, omniscient of the future. Hence they can be expected to take care only
when there is something before them to suggest or warn of danger. Could a prudent
man, in the case under consideration, foresee harm as a result of the course actually
pursued? If so, it was the duty of the actor to take precautions to guard against that harm.
Reasonable foresight of harm, followed by the ignoring of the suggestion born of this
provision, is always necessary before negligence can be held to exist. Stated in these
terms, the proper criterion for determining the existence of negligence in a given case is
this: Conduct is said to be negligent when a prudent man in the position of the tortfeasor
would have foreseen that an effect harmful to another was sufficiently probable warrant
his foregoing the conduct or guarding against its consequences. (emphasis supplied)
To be entitled to damages for an injury resulting from the negligence of another, a claimant must establish
the relation between the omission and the damage. He must prove under Article 2179 of the New Civil
Code that the defendant's negligence was the immediate and proximate cause of his injury. Proximate
cause has been defined as that cause, which, in natural and continuous sequence unbroken by any
efficient intervening cause, produces the injury, and without which the result would not have occurred
(Vda. de Bataclan, et al. v. Medina, 102 Phil. 181, 186). Proof of such relation of cause and effect is not
an arduous one if the claimant did not in any way contribute to the negligence of the defendant. However,
where the resulting injury was the product of the negligence of both parties, there exists a difficulty to
discern which acts shall be considered the proximate cause of the accident. In Taylor v. Manila Electric
Railroad and Light Co. (16 Phil. 8, 29-30), this Court set a guideline for a judicious assessment of the
situation:
Difficulty seems to be apprehended in deciding which acts of the injured party shall be
considered immediate causes of the accident. The test is simple. Distinction must be
made between the accident and the injury, between the event itself, without which there
could have been no accident, and those acts of the victim not entering into it,

independent of it, but contributing to his own proper hurt. For instance, the cause of the
accident under review was the displacement of the crosspiece or the failure to replace it.
This produced the event giving occasion for damages that is, the sinking of the track
and the sliding of the iron rails. To this event, the act of the plaintiff in walking by the side
of the car did not contribute, although it was an element of the damage which came to
himself. Had the crosspiece been out of place wholly or partly through his act or omission
of duty, that would have been one of the determining causes of the event or accident, for
which he would have been responsible. Where he contributes to the principal occurrence,
as one of its determining factors, he can not recover. Where, in conjunction with the
occurrence, he contributes only to his own injury, he may recover the amount that the
defendant responsible for the event should pay for such injury, less a sum deemed a
suitable equivalent for his own imprudence. (emphasis Ours)
Applying all these established doctrines in the case at bar and after a careful scrutiny of the records, We
find no compelling reason to grant the petition. We affirm.
Petitioners fault the city government of Davao for failing to clean a septic tank for the period of 19 years
resulting in an accumulation of hydrogen sulfide gas which killed the laborers. They contend that such
failure was compounded by the fact that there was no warning sign of the existing danger and no efforts
exerted by the public respondent to neutralize or render harmless the effects of the toxic gas. They
submit that the public respondent's gross negligence was the proximate cause of the fatal incident.
We do not subscribe to this view. While it may be true that the public respondent has been remiss in its
duty to re-empty the septic tank annually, such negligence was not a continuing one. Upon learning from
the report of the market master about the need to clean the septic tank of the public toilet in Agdao Public
Market, the public respondent immediately responded by issuing invitations to bid for such service.
Thereafter, it awarded the bid to the lowest bidder, Mr. Feliciano Bascon (TSN, May 24, 1983, pp. 22-25).
The public respondent, therefore, lost no time in taking up remedial measures to meet the situation. It is
likewise an undisputed fact that despite the public respondent's failure to re-empty the septic tank since
1956, people in the market have been using the public toilet for their personal necessities but have
remained unscathed. The testimonies of Messrs. Danilo Garcia and David Secoja (plaintiffs'-petitioners'
witnesses) on this point are relevant, to wit:
Atty. Mojica, counsel for defendant Davao City:
xxx xxx xxx
The place where you live is right along the Agdao creek, is that correct?
DANILO GARCIA:
A Yes, sir.
Q And to be able to go to the market place, where you claim you have a
stall,, you have to pass on the septic tank?
A Yes, sir.
Q Day in and day out, you pass on top of the septic tank?
A Yes, sir.

Q Is it not a fact that everybody living along the creek passes on top of
this septic tank as they go out from the place and return to their place of
residence, is that correct?
And this septic tank, rather the whole of the septic tank, is covered by
lead . . .?
A Yes, sir. there is cover.
Q And there were three (3) of these lead covering the septic tank?
A Yes, sir.
Q And this has always been closed?
A Yes, sir. (TSN, November 26, 1979, pp. 21-23, emphasis supplied)
ATTY. JOVER, counsel for the plaintiffs:
Q You said you are residing at Davao City, is it not?
DAVID SEJOYA:
A Yes, sir.
Q How long have you been a resident of Agdao?
A Since 1953.
Q Where specifically in Agdao are you residing?
A At the Public Market.
Q Which part of the Agdao Public Market is your house located?
A Inside the market in front of the fish section.
Q Do you know where the Agdao septic tank is located?
A Yes, sir.
Q How far is that septic tank located from your house?
A Around thirty (30) meters.
Q Have you ever had a chance to use that septic tank (public toilet)?
A Yes, sir.
Q How many times, if you could remember?

A Many times, maybe more than 1,000 times.

Q Prior to November 22, 1975, have you ever used that septic tank
(public toilet)?
A Yes, sir.
Q How many times have you gone to that septic tank (public toilet) prior
to that date, November 22, 1975?
A Almost 1,000 times. (TSN, February 9, 1983, pp. 1-2)
The absence of any accident was due to the public respondent's compliance with the sanitary
and plumbing specifications in constructing the toilet and the septic tank (TSN, November 4,
1983, p. 51). Hence, the toxic gas from the waste matter could not have leaked out because the
septic tank was air-tight (TSN, ibid, p. 49). The only indication that the septic tank in the case at
bar was full and needed emptying was when water came out from it (TSN, September 13, 1983,
p. 41). Yet, even when the septic tank was full, there was no report of any casualty of gas
poisoning despite the presence of people living near it or passing on top of it or using the public
toilet for their personal necessities.
Petitioners made a lot of fuss over the lack of any ventilation pipe in the toilet to emphasize the
negligence of the city government and presented witnesses to attest on this lack. However, this strategy
backfired on their faces. Their witnesses were not expert witnesses. On the other hand, Engineer
Demetrio Alindada of the city government testified and demonstrated by drawings how the safety
requirements like emission of gases in the construction of both toilet and septic tank have been complied
with. He stated that the ventilation pipe need not be constructed outside the building as it could also be
embodied in the hollow blocks as is usually done in residential buildings (TSN, November 4, 1983, pp. 5051). The petitioners submitted no competent evidence to corroborate their oral testimonies or rebut the
testimony given by Engr. Alindada.
We also do not agree with the petitioner's submission that warning signs of noxious gas should have
been put up in the toilet in addition to the signs of "MEN" and "WOMEN" already in place in that area.
Toilets and septic tanks are not nuisances per se as defined in Article 694 of the New Civil Code which
would necessitate warning signs for the protection of the public. While the construction of these public
facilities demands utmost compliance with safety and sanitary requirements, the putting up of warning
signs is not one of those requirements. The testimony of Engr. Alindada on this matter is elucidative:
ATTY. ALBAY:
Q Mr. Witness, you mentioned the several aspects of the approval of the
building permit which include the plans of an architect, senitary engineer
and electrical plans. All of these still pass your approval as building
official, is that correct?
DEMETRIO ALINDADA:
A Yes.
Q So there is the sanitary plan submitted to and will not be approved by
you unless the same is in conformance with the provisions of the building
code or sanitary requirements?

A Yes, for private building constructions.

Q How about public buildings?
A For public buildings, they are exempted for payment of building permits
but still they have to have a building permit.
Q But just the same, including the sanitary plans, it require your
approval?
A Yes, it requires also.
Q Therefore, under the National Building Code, you are empowered not
to approve sanitary plans if they are not in conformity with the sanitary
requirements?
A Yes.
Q Now, in private or public buildings, do you see any warning signs in
the vicinity of septic tanks?
A There is no warning sign.
Q In residential buildings do you see any warning sign?
A There is none.
ATTY. AMPIG:
We submit that the matter is irrelevant and immaterial, Your Honor.
ATTY. ALBAY:
But that is in consonance with their cross-examination, your Honor.
COURT:
Anyway it is already answered.
ATTY. ALBAY:
Q These warning signs, are these required under the preparation of the
plans?
A It is not required.
Q I will just reiterate, Mr. Witness. In residences, for example like the
residence of Atty. Ampig or the residence of the honorable Judge, would
you say that the same principle of the septic tank, from the water closet
to the vault, is being followed?

A Yes.
ATTY. ALBAY:
That will be all, Your Honor. (TSN, December 6, 1983, pp. 62-63)
In view of this factual milieu, it would appear that an accident such as toxic gas leakage from the septic
tank is unlikely to happen unless one removes its covers. The accident in the case at bar occurred
because the victims on their own and without authority from the public respondent opened the septic tank.
Considering the nature of the task of emptying a septic tank especially one which has not been cleaned
for years, an ordinarily prudent person should undoubtedly be aware of the attendant risks. The victims
are no exception; more so with Mr. Bertulano, an old hand in this kind of service, who is presumed to
know the hazards of the job. His failure, therefore, and that of his men to take precautionary measures for
their safety was the proximate cause of the accident. In Culion Ice, Fish and Elect. Co., v. Phil. Motors
Corporation (55 Phil. 129, 133), We held that when a person holds himself out as being competent to do
things requiring professional skill, he will be held liable for negligence if he fails to exhibit the care and
skill of one ordinarily skilled in the particular work which he attempts to do (emphasis Ours). The fatal
accident in this case would not have happened but for the victims' negligence. Thus, the appellate court
was correct to observe that:
. . . Could the victims have died if they did not open the septic tank which they were not in
the first place authorized to open? Who between the passive object (septic tank) and the
active subject (the victims herein) who, having no authority therefore, arrogated unto
themselves, the task of opening the septic tank which caused their own deaths should be
responsible for such deaths. How could the septic tank which has been in existence since
the 1950's be the proximate cause of an accident that occurred only on November 22,
1975? The stubborn fact remains that since 1956 up to occurrence of the accident in
1975 no injury nor death was caused by the septic tank. The only reasonable conclusion
that could be drawn from the above is that the victims' death was caused by their own
negligence in opening the septic tank. . . . (Rollo, p. 23)
Petitioners further contend that the failure of the market master to supervise the area where the septic
tank is located is a reflection of the negligence of the public respondent.
We do not think so. The market master knew that work on the septic tank was still forthcoming. It must be
remembered that the bidding had just been conducted. Although the winning bidder was already known,
the award to him was still to be made by the Committee on Awards. Upon the other hand, the accident
which befell the victims who are not in any way connected with the winning bidder happened before the
award could be given. Considering that the case was yet no award to commence work on the septic tank,
the duty of the market master or his security guards to supervise the work could not have started (TSN,
September 13, 1983, p. 40). Also, the victims could not have been seen working in the area because the
septic tank was hidden by a garbage storage which is more or less ten (10) meters away from the comfort
room itself (TSN, ibid, pp. 38-39). The surreptitious way in which the victims did their job without
clearance from the market master or any of the security guards goes against their good faith. Even their
relatives or family members did not know of their plan to clean the septic tank.
Finally, petitioners' insistence on the applicability of Article 24 of the New Civil Code cannot be sustained.
Said law states:
Art. 24. In all contractual, property or other relations, when one of the parties is at a
disadvantage on account of his moral dependence, ignorance, indigence, mental
weakness, tender age or other handicap, the courts must be vigilant for his protection.

We approve of the appellate court's ruling that "(w)hile one of the victims was invited to bid for
said project, he did not win the bid, therefore, there is a total absence of contractual relations
between the victims and the City Government of Davao City that could give rise to any
contractual obligation, much less, any liability on the part of Davao City." (Rollo, p. 24) The
accident was indeed tragic and We empathize with the petitioners. However, the herein
circumstances lead Us to no other conclusion than that the proximate and immediate cause of the
death of the victims was due to their own negligence. Consequently, the petitioners cannot
demand damages from the public respondent.
ACCORDINGLY, the amended decision of the Court of Appeals dated January 11, 1990 is AFFIRMED.
No costs.
SO ORDERED.
Narvasa, C.J., Cruz, Grio-Aquino and Bellosillo, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION

G.R. No. 127326 December 23, 1999

BENGUET ELECTRIC COOPERATIVE, INC., petitioner,
vs.
COURT OF APPEALS, CARIDAD O. BERNARDO as Guardian Ad Litem for Minors JOJO, JEFFREY
and JO-AN, all surnamed BERNARDO, and GUILLERMO CANAVE, JR., respondents.

BELLOSILLO, J.:
1

This case involves a review on certiorari of the Decision of the Court of Appeals affirming with
modification the decision of the Regional Trial Court of Baguio City, and ordering petitioner Benguet
Electric Cooperative Inc. (BENECO) to pay Caridad O. Bernardo, as guardian ad litem of the three (3)
minor children of the late Jose Bernardo P50,000.00 as indemnity for his death, with interest thereon at
the legal rate from February 6, 1985, the date of the filing of the complaint, until fully paid, P100,000.00
for moral damages, P20,000.00 for exemplary damages, another P20,000.00 for attorney's fees,
P864,000.00 for net income loss for the remaining thirty (30) years of the life expectancy of the deceased,
and to pay the costs of suit.
The appellate court dismissed for lack of merit the counterclaim of BENECO against the Bernardos and
its third party complaint against Guillermo Canave, Jr., as well as the latter's counterclaim.
For five (5) years up to the time of his death, Jose Bernardo managed a stall at the Baguio City meat
market. On 14 January 1985 at around 7:50 in the morning, Jose together with other meat vendors went
out of their stalls to meet a jeepney loaded with slaughtered pigs in order to select the meat they would
sell for the day. Jose was the very first to reach the parked jeepney. Grasping the handlebars at the rear
entrance of the vehicle, and as he was about to raise his right foot to get inside, Jose suddenly stiffened
and trembled as though suffering from an epileptic seizure. Romeo Pimienta who saw Jose thought he

was merely joking but noticed almost in disbelief that he was already turning black. In no time the other
vendors rushed to Jose and they discovered that the antenna of the jeepney bearing the pigs had gotten
entangled with an open electric wire at the top of the roof of a meat stall. Pimienta quickly got hold of a
broom and pried the antenna loose from the open wire. But shortly after, Jose released his hold on the
handlebars of the jeep only to slump to the ground. He died shortly in the hospital. Cause of his death
was "cardio-respiratory arrest secondary to massive brain congestion with petheccial hemorrhage, brain
bilateral pulmonary edema and congestion and endocardial petecchial hemorrhage and dilation (history of
electrocution)."
On 6 February 1985 Caridad O. Bernardo, widow of Jose Bernardo, and their minor children, Jojo, Jeffrey
and Jo-an, all surnamed Bernardo, filed a complaint against BENECO before the Regional Trial Court of
Baguio City for a sum of money and damages arising from the electrocution of Jose Bernardo. In the
same civil action, BENECO filed a third-party complaint against Guillermo Canave, Jr., the jeepney
owner.
In its decision dated 15 August 1994, the trial court ruled in favor of the Bernardos and ordered BENECO
2
to pay them damages. Both petitioner and private respondents herein appealed to the Court of Appeals.
On 5 November 1996 the appellate court promulgated its Decision which BENECO now assails
contending inter alia that the appellate court gravely erred in ordering BENECO to pay damages in light of
the clear evidence that it was third-party defendant Canave's fault or negligence which was the proximate
and sole cause, or at least the principal cause, of the electrocution and death of Jose Bernardo.
First, BENECO questions the award of damages by respondent court notwithstanding a clear showing
that the electrocution and death of Jose Bernardo were directly attributable to the fault and negligence of
jeepney owner Guillermo Canave, Jr.
The records of the case show that respondent court did not commit any reversible error in affirming the
findings of the trial court that BENECO was solely responsible for the untimely death of Jose Bernardo
through accidental electrocution. According to the trial court, which we find substantiated by the records
3

Through Virgilio Cerezo, a registered master electrician and presently the Chief Electrical
Building Inspector of the General Services Division of the City of Baguio, who was tasked
to investigate the electrocution of Bernardo, the plaintiffs adduced proof tending to show
that the defendant BENECO installed a No. 2 high voltage main wire distribution line and
a No. 6 service line to provide power at the temporary meat market on Hilltop Road. It put
up a three-inch G.I. pipe pole to which the No. 2 main line was strung on top of a stall
where a service drop line was connected. The height of the electrical connection from the
No. 2 line to the service line was barely eight (8) to nine (9) feet (Exhibit "E"; See Exhibit
"D-1") which is in violation of the Philippine Electrical Code which requires a minimum
vertical clearance of fourteen (14) feet from the level of the ground since the wiring
crosses a public street. Another violation according to Cerezo, is that the main line
connected to the service line was not of rigid conduit wiring but totally exposed without
any safety protection (Ibid). Worse, the open wire connections were not insulated (Ibid);
See Exhibits "D-6", "D-6-A", "D-7"). The jeep's antenna which was more than eight (8)
feet high (Exhibit "D-9") from the ground (It is about six to seven feet long and mounted
on the left fender which is about three feet above the ground) got entangled with the open
wire connections (Exhibit "D-8"), thereby electrically charging its handlebars which
Bernardo held on to enter the vehicle resulting in his electrocution.
While Vedasto Augusto, an electrical engineer and the line superintendent in the
electrical department of the defendant BENECO, admitted that the allowable vertical
clearance of the service drop line is even 15 feet from the ground level and not only 14
feet, he and Jose Angeles, then an instrument man or surveyor of the BENECO, insisted
that BENECO installed (they do not know by whom in particular) from the Apollo Building

nearby a service drop line carrying 220 volts which was attached to a G.I. pipe pole
(Exhibits "1" and "1-A"). The vertical clearance of the point of attachment of the service
drop line on the G.I. post to the ground is 15.5 feet (Exhibit "1-B"), which is more than the
allowable 15-foot clearance. To this service drop line was connected the service entrance
conductor (Exhibit "1-D") to supply power inside the premises to be serviced through an
electric meter. At the lower portion of the splicing or connecting point between the service
drop line and the service entrance conductor is a three to four-inch bare wire to serve as
a ground. They saw the bare wire because the splicing point was exposed as it was not
covered with tape (Exhibit "1-E"). The antenna of the jeep which electrocuted Bernardo
got entangled with this exposed splicing point.
Augusto claimed that it was not BENECO's job to splice or connect the service entrance
conductor to the service drop line but rather the owner of the premises to be serviced
whose identity they did not, however, determine.
Significantly, on cross-examination, Augusto admitted that the service drop line that
BENECO installed did not end at the point to which it is attached to the G.I. post. Rather,
it passed through a spool insulator that is attached to the post (Exhibit "1-F") and
extended down to where the service entrance conductor is spliced with the result that the
exposed splicing point (Exhibit "1-E") is only about eight (8) feet from the ground level.
There is no question that as an electric cooperative holding the exclusive franchise in supplying electric
power to the towns of Benguet province, its primordial concern is not only to distribute electricity to its
subscribers but also to ensure the safety of the public by the proper maintenance and upkeep of its
facilities. It is clear to us then that BENECO was grossly negligent in leaving unprotected and uninsulated
the splicing point between the service drop line and the service entrance conductor, which connection
was only eight (8) feet from the ground level, in violation of the Philippine Electrical Code. BENECO's
contention that the accident happened only on January 14, 1985, around seven (7) years after the open
wire was found existing in 1978, far from mitigating its culpability, betrays its gross neglect in performing
4
its duty to the public. By leaving an open live wire unattended for years, BENECO demonstrated its utter
disregard for the safety of the public. Indeed, Jose Bernardo's death was an accident that was bound to
happen in view of the gross negligence of BENECO.
BENECO theorizes in its defense that the death of Jose Bernardo could be attributed to the negligence of
Canave, Jr., in parking his jeepney so close to the market stall which was neither a parking area nor a
loading area, with his antenna so high as to get entangled with an open wire above the Dimasupil
5
store. But this line of defense must be discarded. Canave's act of parking in an area not customarily
used for that purpose was by no means the independent negligent act adverted to by BENECO in citing
6
Manila Electric Co. v. Ronquillo. Canave was well within his right to park the vehicle in the said area
where there was no showing that any municipal law or ordinance was violated nor that there was any
foreseeable danger posed by his act. One thing however is sure, no accident would have happened had
BENECO installed the connections in accordance with the prescribed vertical clearance of fifteen (15)
feet.
Second. BENECO avers that the Court of Appeals gravely erred in awarding P864,000.00 as net income
loss for the thirty (30) years remaining of the life expectancy of the deceased Jose Bernardo, albeit the
trial court found no firm basis for awarding this item of damages.
We recall that the trial court disallowed the award for net loss income in view of the alleged contradictory
and untrustworthy testimony of the deceased's surviving spouse Caridad Bernardo. Thus
As to lost earnings. The court finds the allegations of the plaintiffs, particularly Caridad
Bernardo contradictory and untrustworthy. While in the complaint, which she herself
verified, she asseverated that at the time of his death on January 14, 1985, her late

husband was earning no less than P150.00 daily after deducting personal expenses and
household and other family obligations; at the trial she bloated this up to P3,000.00 gross
daily or P300.00 profit a day or a net income of P200.00 daily after deducting personal
and household expenses. But inexplicably she could not present the income tax return of
her husband for 1983 and 1984 although she stated that he had been filing such returns.
What she submitted are his income tax returns for 1981 and 1982 showing a much lower
annual gross income of P12,960.00 and P16,120.00, respectively. The Court, therefore,
finds no firm basis for awarding this item of damages.
In modifying the decision of the trial court, the Court of Appeals relied on the testimony of Rosita Noefe,
sister of the deceased, that her brother started as her helper in the several meat stalls she operated until
1982 when she allowed Jose to operate one of her stalls as his own and gave him an initial capital of
P15,000.00 to add to his own. She explained that her brother sold from 100 to 150 kilos of pork and 30 to
50 kilos of meat a day earning an income of about P150.00 to P200.00 pesos daily. After deducting his
personal expenses and family obligations, Jose earned a daily net income between P70.00 and P80.00.
Jose Bernardo died of electrocution at the age of thirty-three (33). Following the ruling in Villa Rey Transit
7
8
v. Court of Appeals and Davila v. PAL his life expectancy would allow him thirty and one third (30-1/3)
years more. Assuming on the basis of his P80.00 daily net income translated to P2,400.00 monthly or
P28,800.00 yearly, the net income loss for the thirty (30) years remaining of his life expectancy would
9
amount to P864,000.00.
While we are of the opinion that private respondent Bernardo is entitled to indemnity for loss of earning
capacity of her deceased husband we however find that a modification is in order. The amount
corresponding to the loss of earning capacity is based mainly on two factors: (a) the number of years on
the basis of which the damages shall be computed; and, (b) the rate at which the losses sustained by the
10
widow and her children should be fixed.
We consider that the deceased was married with three (3) children and thirty-three (33) years old at the
time of his death. By applying the formula: 2/3 x (80 - 33) = Life Expectancy, the normal life expectancy of
the deceased would be thirty-one and one-third (31-1/3) years and not thirty (30) as found by the
respondent court. By taking into account the nature and quality of life of a meat vendor, it is hard to
conceive that Jose would still be working for the full stretch of the remaining thirty-one (31) years of his
life; and therefore it is but reasonable to make allowances and reduce his life expectancy to twenty-five
11
(25) years.
Anent the second factor, we are of the view that the Court of Appeals was correct in relying on the
unrebutted testimony of Rosita Noefe concerning the income of Jose, thus providing a basis for fixing the
rate of damages incurred by the heirs of the deceased. Rosita clarified as follows:
Q: Now you said that you brother's stall is just very near, about 4 to 5
meters away from your stall. Do you know more or less how your brother
was earning by way of income because the stall belongs also to you and
your husband?
A: Yes, sir (emphasis supplied).
Q: How much more or less would you say his daily income from the stall,
if you know?
A: P150 to P200 more, sometimes more than P200.
Q: What is this? Monthly, daily, or what?
A: Daily sir.

Q: Now, when you said that he earns sometimes 150 or 200 in a day can
(sic) you tell this court more or less how many in terms of net or in terms
of kilos that he can sell with that amount daily?
A: More than one hundred (100) kilos, sir, or one hundred fifty kilos
(150).
Q: By the way what was your brother selling also in that meat stall?
A: Pork and beef, sir.
Q: In terms of how many slaughter(ed) pigs would that be if you know?
100 to 150 kilo
A: Two (2) pigs, sir.
Q: Is this . . . How about meat, I mean aside from pigs?
A: About thirty (30) to fifty (50) kilos for beef.
Q: Now, will you tell this court why you know more or less that this is his
daily income?
A: I know it because I experienced it and I only transferred this stall to
him.
Q: And his income, you said, of 150 daily to 200 for the sale of pork and
meat will you know what are his family expenses being your brother and
is living with you in the same place at the slaughter house?
A: About P70.00 to P80.00 a day.
Q: And what are the other income that your brother derive (sic) aside
from the meat stall after spending these daily expenses?
A: None, sir.
Contrary to the assertion of BENECO, there is ample basis for the fixing of damages incurred by the heirs
of the deceased. Notwithstanding the failure of private respondent Bernardo to present documentary
evidence to support her claim, the unrebutted testimony of Rosita Noefe supplied this deficiency. Indeed,
there is no reason to doubt the veracity of Rosita's testimony considering that she owned the very same
stall that Jose was operating and managing before his death. Her testimony on the earning capacity of
Jose is enough to establish the rationale for the award.
The discrepancy between private respondent Bernardo's claims regarding her husband's income as
contained in the complaint, where she alleged that Jose was earning no less than P150.00 a day, and her
testimony during trial that he earned P300.00 daily, could not obviate the fact that at the time of his death
Jose was earning a living as a meat vendor. Undoubtedly, his untimely death deprived his family of his
potential earnings. The allegation in the complaint fixing his income at P150.00 a day was corroborated
by the unqualified declaration of Rosita Noefe that he was earning P150.00 to P200.00 a day. Obviously
the bloated figure of P300.00 given by private respondent Bernardo was an afterthought perhaps impelled
by the prospect of being awarded a greater sum.

We now fix Jose's daily gross income at P150.00 or his annual gross income at P54,000.00. After
deducting personal expenses, household and other family obligations, we can safely assume that his
annual net income at the time of death was P27,000.00 or 50% of his yearly gross earnings of
12
P54,000.00.
Accordingly, determining the indemnity for the loss of earning capacity, we multiply the life expectancy of
the deceased as reduced to twenty-five (25) years by the annual net income of P27,000.00 which gives
us P675,000.00. Therefore, we deduce that his net earning capacity is P675,000.00 computed as follows:
13
Net Earning Capacity = Life Expectancy x Gross Annual Income - Necessary Living Expenses.
Reduced to simpler form:
Net Earning = Life x Gross Annual Necessary
Capacity Expectancy Income Living Expenses
= 2 (80 - 33) x (P54,000 27,000)

3
= 31-1/3
(reduced to 25) x 27,000 = 675,000.00
= P675,000.00 NET INCOME LOSS (as reduced)
Third. BENECO contends that exemplary damages should not be awarded as the amount claimed was
not specified in the body nor in the prayer of the complaint, in contravention of the mandate in Rule 11 of
the Interim Rules and Guidelines implementing BP 129 which requires the amount of damages to be
specifically alleged apparently for the purpose of computing the docket fees.
BENECO's contention deserves no merit. The amount of exemplary damages need not be pleaded in the
complaint because the same cannot be predetermined. One can merely ask that it be fixed by the court
14
as the evidence may warrant and be awarded at its own discretion. In fact, the amount of exemplary
damages need not be proved because its determination is contingent upon or incidental to the amount of
compensatory damages that may be awarded to the claimant. Moreover, this Court in a number of
occasions ruled that the amount of docket fees to be paid should be computed on the basis of the amount
of the damages stated in the complaint. Where subsequently however the judgment awarded a claim not
specified in the pleading, or if specified, the same was left for the determination of the court, an additional
15
filing fee therefor may be assessed and considered to constitute a lien on the judgment.
16

We are not unaware of the principle laid down in Tacay v. Regional Trial Court of Tagum where the trial
court was ordered to either expunge the unspecified claim for exemplary damages or allow the private
respondent to amend the complaint within a reasonable time and specify the amount corresponding
docket fees. However, we prefer not to expunge the claim for exemplary damages and pursue the Tacay
lead, for to delete the claim for exemplary damages would be to give premium to BENECO's gross
negligence while to order the amendment of the complaint would be to unjustly delay the proceedings and
prolong further the almost fifteen-year agony of the intended beneficiaries.
Exemplary damages are imposed by way of example or correction for the public good, in addition to
moral, temperate, liquidated or compensatory damages. It is awarded as a deterrent to socially
deleterious actions. In quasi-delict, exemplary damages are awarded when the act or omission which

17

caused injury is attended by gross negligence. Gross negligence has been defined as negligence
characterized by the want of even slight care, acting or omitting to act in a situation where there is duty to
act, not inadvertently but willfully and intentionally, with a conscious indifference to consequences in so
18
far as other persons may be affected.
In the instant case, there is a clear showing of BENECO's gross negligence when it failed to detect, much
less to repair, for an inexcusably long period of (7) years the uninsulated connection which caused the
death of Jose Bernardo. The gravity of its ineptitude was compounded when it installed the service drop
line way below the prescribed minimum vertical clearance of fifteen (15) feet. Again, precautionary
measures were not taken in wanton disregard of the possible consequences. Under these circumstances,
we find no reason to disturb the finding of respondent court awarding exemplary damages to private
respondent Bernardo in the amount of P20,000.00.
Finally, BENECO questions the grant of moral damages and attorney's fees on the same ground of nonculpability. It is settled that moral damages are not intended to enrich the complainant but to serve to
obviate his/her spiritual suffering by reason of the culpable action of the defendant. Its award is aimed at
the restoration of the spiritual status quo ante, and it must be commensurate to the suffering inflicted. As
a result of the accidental death of Jose, his widow Caridad and their three (3) minor children had to
scrounge for a living in order to keep their heads above water. Caridad had to depend on the generosity
of her relatives which came intermittently and far between and augment whatever she received from them
with her meager income from her small business. She must have agonized over the prospect of raising
her three (3) small children all by herself given her unstable financial condition. For the foregoing reasons,
we sustain the award of moral damages by respondent court except as to the amount thereof. In the
instant case, we are of the opinion that moral damages in the amount of P50,000.00 are more in accord
with the injury suffered by private respondent and her children.
As for attorney's fees, we find no legal nor factual basis to overturn the ruling of respondent court on the
matter; accordingly, the grant of P20,000.00 attorney's fees to private respondent Bernardo is adopted.
WHEREFORE, the assailed Decision of the Court of Appeals dated 5 November 1996 ordering petitioner
Benguet Electric Cooperative, Inc., to pay private respondent Caridad O. Bernardo as guardian ad litem
for the minors Jojo, Jeffrey and Jo-an, all surnamed Bernardo, P20,000.00 as exemplary damages,
another P20,000.00 for attorney's fees, and P50,000.00 as indemnity for the death of Jose Bernardo, is
AFFIRMED with the MODIFICATION that the P864,000.00 as net income loss is reduced to P675,000.00
and the P100,000.00 as moral damages is also reduced to P50,000.00.
Costs against petitioner.
SO ORDERED.
Mendoza, Quisumbing, Buena and De Leon, Jr., JJ., concur.

ii. The "cause"

*Proximate
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 156037

May 28, 2007

MERCURY DRUG CORPORATION, Petitioner,

vs.
SEBASTIAN M. BAKING, Respondent.
DECISION
SANDOVAL-GUTIERREZ, J.:
1

For our resolution is the instant Petition for Review on Certiorari assailing the Decision dated May 30,
2002 and Resolution dated November 5, 2002 of the Court of Appeals in CA-G.R. CV No. 57435, entitled
"Sebastian M. Baking, plaintiff-appellee, versus Mercury Drug Co. Inc., defendant-appellant."
The facts are:
On November 25, 1993, Sebastian M. Baking, respondent, went to the clinic of Dr. Cesar Sy for a medical
check-up. On the following day, after undergoing an ECG, blood, and hematology examinations and
urinalysis, Dr. Sy found that respondents blood sugar and triglyceride were above normal levels. Dr. Sy
then gave respondent two medical prescriptions Diamicron for his blood sugar and Benalize tablets for
his triglyceride.
Respondent then proceeded to petitioner Mercury Drug Corporation (Alabang Branch) to buy the
prescribed medicines. However, the saleslady misread the prescription for Diamicron as a prescription for
Dormicum. Thus, what was sold to respondent was Dormicum, a potent sleeping tablet.
Unaware that what was given to him was the wrong medicine, respondent took one pill of Dormicum on
three consecutive days November 6, 1993 at 9:00 p.m., November 7 at 6:00 a.m., and November 8 at
7:30 a.m.
On November 8 or on the third day he took the medicine, respondent figured in a vehicular accident. The
car he was driving collided with the car of one Josie Peralta. Respondent fell asleep while driving. He
could not remember anything about the collision nor felt its impact.
Suspecting that the tablet he took may have a bearing on his physical and mental state at the time of the
collision, respondent returned to Dr. Sys clinic. Upon being shown the medicine, Dr. Sy was shocked to
find that what was sold to respondent was Dormicum, instead of the prescribed Diamicron.
Thus, on April 14, 1994, respondent filed with the Regional Trial Court (RTC), Branch 80 of Quezon City a
complaint for damages against petitioner, docketed as Civil Case No. Q-94-20193.
After hearing, the trial court rendered its Decision dated March 18, 1997 in favor of respondent, thus:
WHEREFORE, premises considered, by preponderance of evidence, the Court hereby renders judgment
in favor of the plaintiff and against the defendant ordering the latter to pay mitigated damages as follows:
1. P250,000.00 as moral damages;
2. P20,000.00 as attorneys fees and litigation expenses;
3. plus % of the cost of the suit.

SO ORDERED.
On appeal, the Court of Appeals, in its Decision, affirmed in toto the RTC judgment. Petitioner filed a
motion for reconsideration but it was denied in a Resolution dated November 5, 2002.
Hence, this petition.
Petitioner contends that the Decision of the Court of Appeals is not in accord with law or prevailing
jurisprudence.
Respondent, on the other hand, maintains that the petition lacks merit and, therefore, should be denied.
The issues for our resolution are:
1. Whether petitioner was negligent, and if so, whether such negligence was the proximate cause
of respondents accident; and
2. Whether the award of moral damages, attorneys fees, litigation expenses, and cost of the suit
is justified.
Article 2176 of the New Civil Code provides:
Art. 2176. Whoever by act or omission causes damage to another, there being fault or negligence, is
obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual
relation between the parties, is called a quasi-delict and is governed by the provisions of this Chapter.
To sustain a claim based on the above provision, the following requisites must concur: (a) damage
suffered by the plaintiff; (b) fault or negligence of the defendant; and, (c) connection of cause and effect
3
between the fault or negligence of the defendant and the damage incurred by the plaintiff.
There is no dispute that respondent suffered damages.
It is generally recognized that the drugstore business is imbued with public interest. The health and safety
of the people will be put into jeopardy if drugstore employees will not exercise the highest degree of care
and diligence in selling medicines. Inasmuch as the matter of negligence is a question of fact, we defer to
the findings of the trial court affirmed by the Court of Appeals.
Obviously, petitioners employee was grossly negligent in selling to respondent Dormicum, instead of the
prescribed Diamicron. Considering that a fatal mistake could be a matter of life and death for a buying
patient, the said employee should have been very cautious in dispensing medicines. She should have
verified whether the medicine she gave respondent was indeed the one prescribed by his physician. The
care required must be commensurate with the danger involved, and the skill employed must correspond
4
with the superior knowledge of the business which the law demands. 1awphi1.nt
Petitioner contends that the proximate cause of the accident was respondents negligence in driving his
car.
We disagree.
Proximate cause is defined as any cause that produces injury in a natural and continuous sequence,
unbroken by any efficient intervening cause, such that the result would not have occurred otherwise.

Proximate cause is determined from the facts of each case, upon a combined consideration of logic,
5
common sense, policy, and precedent.
Here, the vehicular accident could not have occurred had petitioners employee been careful in reading
Dr. Sys prescription. Without the potent effects of Dormicum, a sleeping tablet, it was unlikely that
respondent would fall asleep while driving his car, resulting in a collision.
Complementing Article 2176 is Article 2180 of the same Code which states:
ART. 2180. The obligation imposed by Article 2176 is demandable not only for ones own acts or
omissions, but also for those of persons for whom one is responsible.
xxx
The owners and managers of an establishment or enterprise are likewise responsible for damages
caused by their employees in the service of the branches in which the latter are employed or on the
occasion of their functions.
Employers shall be liable for the damages caused by their employees and household helpers acting
within the scope of their assigned tasks, even though the former are not engaged in any business or
industry.
xxx
The responsibility treated of in this article shall cease when the persons herein mentioned prove that they
observed the diligence of a good father of a family to prevent damage.
It is thus clear that the employer of a negligent employee is liable for the damages caused by the latter.
When an injury is caused by the negligence of an employee, there instantly arises a presumption of the
law that there has been negligence on the part of the employer, either in the selection of his employee or
in the supervision over him, after such selection. The presumption, however, may be rebutted by a clear
showing on the part of the employer that he has exercised the care and diligence of a good father of a
6
family in the selection and supervision of his employee. Here, petitioner's failure to prove that it exercised
the due diligence of a good father of a family in the selection and supervision of its employee will make it
solidarily liable for damages caused by the latter.
As regards the award of moral damages, we hold the same to be in order. Moral damages may be
awarded whenever the defendants wrongful act or omission is the proximate cause of the plaintiffs
physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings,
moral shock, social humiliation, and similar injury in the cases specified or analogous to those provided in
7
Article 2219 of the Civil Code.
Respondent has adequately established the factual basis for the award of moral damages when he
testified that he suffered mental anguish and anxiety as a result of the accident caused by the negligence
of petitioners employee.
There is no hard-and-fast rule in determining what would be a fair and reasonable amount of moral
damages, since each case must be governed by its own peculiar facts. However, it must be
8
commensurate to the loss or injury suffered. Taking into consideration the attending circumstances here,
we are convinced that the amount awarded by the trial court is exorbitant. Thus, we reduce the amount of
moral damages from P250,000.00 to P50,000.00 only.

In addition, we also deem it necessary to award exemplary damages. Article 2229 allows the grant of
exemplary damages by way of example or correction for the public good. As mentioned earlier, the
drugstore business is affected with public interest. Petitioner should have exerted utmost diligence in the
selection and supervision of its employees. On the part of the employee concerned, she should have
been extremely cautious in dispensing pharmaceutical products. Due to the sensitive nature of its
business, petitioner must at all times maintain a high level of meticulousness. Therefore, an award of
exemplary damages in the amount of P25,000.00 is in order.1awphi1.nt
On the matter of attorneys fees and expenses of litigation, it is settled that the reasons or grounds for the
9
award thereof must be set forth in the decision of the court. Since the trial courts decision did not give
the basis of the award, the same must be deleted. In Vibram Manufacturing Corporation v. Manila Electric
10
Company, we held:
Likewise, the award for attorneys fees and litigation expenses should be deleted. Well-enshrined is that
"an award for attorneys fees must be stated in the text of the courts decision and not in the dispositive
portion only" (Consolidated Bank and Trust Corporation (Solidbank) v. Court of Appeals, 246 SCRA 193
[1995] and Keng Hua Paper Products, Inc. v. Court of Appeals, 286 SCRA 257 [1998]). This is also true
with the litigation expenses where the body of the decision discussed nothing for its basis.
WHEREFORE, we DENY the petition. The challenged Decision and Resolution of the Court of Appeals in
CA-G.R. CV No. 57435 are AFFIRMED with modification in the sense that (a) the award of moral
damages to respondent is reduced from P250,000.00 to P50,000.00; (b) petitioner is likewise ordered to
pay said respondent exemplary damages in the amount of P25,000.00; and (c) the award of attorneys
fees and litigation expenses is deleted.
Costs against petitioner.
SO ORDERED.
ANGELINA SANDOVAL-GUTIERREZ
Associate Justice
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION

G.R. No. 105410 July 25, 1994

PILIPINAS BANK, petitioner,
vs.
HON. COURT OF APPEALS AND FLORENCIO REYES, respondents.
Gella Reyes Danguilan & Associates for petitioner.
Santos V. Pampolina, Jr. for private respondent.

PUNO, J.:

This is a petition for review of the Decision of the respondent court in CA-G.R. CV No. 29524 dated May
13, 1992 which ordered petitioner to pay the private respondent the sum of P50,000.00 as moral
damages, P25,000.00 as attorney's fees and cost of suit.
2

The facts as found both by the trial court and the respondent court are:
As payments for the purchased shoe materials and rubber shoes, Florencio Reyes
issued postdated checks to Winner Industrial Corporation for P20,927.00 and Vicente
Tui, for P11,419.50, with due dates on October 10 and 12, 1979, respectively.
To cover the face value of the checks, plaintiff, on October 10, 1979, requested PCIB
Money Shop's manager Mike Potenciano to effect the withdrawal of P32,000.00 from his
savings account therein and have it deposited with his current account with Pilipinas
Bank (then Filman Bank), Bian Branch. Roberto Santos was requested to make the
deposit.
In depositing in the name of FLORENCIO REYES, he inquired from the teller the current
account number of Florencio Reyes to complete the deposit slip he was accomplishing.
He was informed that it was "815" and so this was the same current account number he
placed on the deposit slip below the depositor's name FLORENCIO REYES.
Nothing that the account number coincided with the name Florencio, Efren Alagasi, then
Current Account Bookkeeper of Pilipinas Bank, thought it was for Florencio Amador who
owned the listed account number. He, thus, posted the deposted in the latter's account
not noticing that the depositor's surname in the deposit slip was REYES.
On October 11, 1979, the October 10, check in favor of Winner Industrial Corporation
was presented for payment. Since the ledger of Florencio Reyes indicated that his
account had only a balance of P4,078.43, it was dishonored and the payee was advised
to try it for next clearing.
On October 15, 1979, the October 10, 1979 check was redeposited but was again
dishonored. Likewise, the October 12, 1979 check in favor of Vicente Tui when presented
for payment on that same date met the same fate but was advised to try the next
clearing. Two days after the October 10 check was again dishonored, the payee returned
the same to Florencio Reyes and demanded a cash payment of its face value which he
did if only to save his name. The October 12, 1979 check was redeposited on October
18, 1979, but again dishonored for the reason that the check was drawn against
insufficient fund.
Furious over the incident, he immediately proceeded to the bank and urged an immediate
verification of his account.
Upon verification, the bank noticed the error. The P32,000.00 deposit posted in the
account of Florencio Amador was immediately transferred to the account of Reyes upon
being cleared by Florencio Amador that he did not effect a deposit in the amount of
P32,000.00. The transfer having been effected, the bank then honored the October 12,
1979, check (Exh. "C").
On the basis of these facts, the trial court ordered petitioner to pay to the private respondent: (1)
P200,000.00 as compensatory damages; (2) P100,000.00 as moral damages; (3) P25,000.00 as
attorney's fees, and (4) the costs of suit. On appeal to the respondent court, the judgment was modified
as aforestated.

In this petition for review, petitioner argues:

I. Respondent Court of Appeals erred on a matter of law, in not applying the first
sentence of Article 2179, New Civil Code, in view of its own finding that respondent
Reyes' own representative committed the mistake in writing down the correct account
number;
II. Respondent Court of Appeals erred, on a matter of law, in holding that respondent
Reyes has the right to recover moral damages and in awarding the amount of
P50,000.00, when there is no legal nor factual basis for it;
III. The Honorable Court of Appeals erred, on a matter of law, in holding petitioner liable
for attorney's fees in the amount of P20,000.00, when there is no legal nor factual basis
for it.
We find no merit in the petition.
3

First. For Article 2179 of the Civil Code to apply, it must be established that private respondent's own
negligence was the immediate and proximate cause of his injury. The concept of proximate cause is well
defined in our corpus of jurisprudence as "any cause which, in natural and continuous sequence,
unbroken by any efficient intervening cause, produces the result complained of and without which would
not have occurred and from which it ought to have been forseen or reasonably anticipated by a person of
ordinary case that the injury complained of or some similar injury, would result therefrom as a natural and
4
probable consequence." In the case at bench, the proximate cause of the injury is the negligence of
petitioner's employee in erroneously posting the cash deposit of private respondent in the name of
another depositor who had a similar first name. As held by the trial court:
xxx xxx xxx
Applying the test, the bank employee is, on that basis, deemed to have failed to exercise
the degree of care required in the performance of his duties. As earlier stated, the bank
employee posted the cash deposit in the account of Florencio Amador from his
assumption that the name Florencio appearing on the ledger without, however, going
through the full name, is the same Florencio stated in the deposit slip. He should have
continuously gone beyond mere assumption, which was proven to be erroneous, and
proceeded with clear certainty, considering the amount involved and the repercussions it
would create on the totality of the person notable of which is the credit standing of the
person involved should a mistake happen. The checks issued by the plaintiff in the
course of his business were dishonored by the bank because the ledger of Florencio
Reyes indicated a balance insufficient to cover the face value of checks.
Second. In light of this negligence, the liability of petitioner for moral damages cannot be impugned. So
5
we held in Bank of the Philippine Islands vs. IAC, et al.
The bank is not expected to be infallible but, as correctly observed by respondent
Appellate Court, in this instance, it must bear the blame for not discovering the mistake of
its teller despite the established procedure requiring the papers and bank books to pass
through a battery of bank personnel whose duty it is to check and countercheck them for
possible errors. Apparently, the officials and employees tasked to do that did not perform
their duties with due care, as may be gathered from the testimony of the bank's lone
witness, Antonio Enciso, who casually declared that "the approving officer does not have
to see the account numbers and all those things. Those are very petty things for the
approving manager to look into" (p. 78, Record on Appeal). Unfortunately, it was a "petty
thing," like the incorrect account number that the bank teller wrote on the initial deposit

slip for the newly-opened joint current account of the Canlas spouses, that sparked this
half-a-million-peso damage suit against the bank.
While the bank's negligence may not have been attended with malice and bad faith,
nevertheless, it caused serious anxiety, embarrassment and humiliation to the private
respondents for which they are entitled to recover reasonable moral damages (American
Express International, Inc. IAC, 167 SCRA 209). The award of reasonable attorney's fees
is proper for the private respondent's were compelled to litigate to protect their interest
(Art. 2208, Civil Code). However, the absence of malice and bad faith renders the award
of exemplary damages improper (Globe Mackay Cable and Radio Corp. vs. Court of
Appeals, 176 SCRA 778).
IN VIEW WHEREOF, the petition is denied there being no reversible error in the Decision of the
respondent court. Cost against petitioner.
SO ORDERED.
Narvasa, C.J., Padilla, Regalado and Mendoza, JJ., concur.

* Concurrent

EN BANC
[G.R. No. 130068. October 1, 1998]
FAR EASTERN SHIPPING COMPANY, petitioner, vs. COURT OF APPELAS and PHILIPPINE PORTS
AUTHORITY, respondents.
[G.R. No. 130150. October 1, 1998]
MANILA PILOTS ASSOCIATION, petitioner, vs. PHILIPPINE PORTS AUTHORITY and FAR
EASTERN SHIPPING COMPANY, respondents.
DECISION
REGALADO, J.:
These consolidated petitions for review on certiorari seek in unison to annul and set aside the decisioni[1]
of respondent Court of Appeals of November 15, 1996 and its resolutionii[2] dated July 31, 1997 in CAG.R. CV No. 24072, entitled Philippine Ports Authority, Plaintiff-Appellee vs. Far Eastern Shipping
Company, Senen C. Gavino and Manila Pilots Association. Defendants-Appellants, which affirmed with
modification the judgment of the trial court holding the defendants-appellants therein solidarily liable for
damages in favor of herein private respondent.
There is no dispute about the facts as found by the appellate court, thus -x x x On June 20, 1980, the M/V PAVLODAR, flying under the flagship of the USSR, owned and
operated by the Far Eastern Shipping Company (FESC for brevitys sake), arrived at the Port of Manila

from Vancouver, British Columbia at about 7:00 oclock in the morning. The vessel was assigned Berth 4
of the Manila International Port, as its berthing space. Captain Roberto Abellana was tasked by the
Philippine Port Authority to supervise the berthing of the vessel. Appellant Senen Gavino was assigned
by the appellant Manila Pilots Association (MPA for brevitys sake) to conduct docking maneuvers for the
safe berthing of the vessel to Berth No. 4.
Gavino boarded the vessel at the quarantine anchorage and stationed himself in the bridge, with the
master of the vessel, Victor Kavankov, beside him. After a briefing of Gavino by Kavankov of the
particulars of the vessel and its cargo, the vessel lifted anchor from the quarantine anchorage and
proceeded to the Manila International Port. The sea was calm and the wind was ideal for docking
maneuvers.
When the vessel reached the landmark (the big church by the Tondo North Harbor) one-half mile from the
pier, Gavino ordered the engine stopped. When the vessel was already about 2,000 feet from the pier,
Gavino ordered the anchor dropped. Kavankov relayed the orders to the crew of the vessel on the bow.
The left anchor, with two (2) shackles were dropped. However, the anchor did not take hold as expected.
The speed of the vessel did not slacken. A commotion ensued between the crew members. A brief
conference ensued between Kavankov and the crew members. When Gavino inquired what was all the
commotion about, Kavankov assured Gavino that there was nothing of it.
After Gavino noticed that the anchor did not take hold, he ordered the engines half-astern. Abellana, who
was then on the pier apron, noticed that the vessel was approaching the pier fast. Kavankov likewise
noticed that the anchor did not take hold. Gavino thereafter gave the full-astern code. Before the right
anchor and additional shackles could be dropped, the bow of the vessel rammed into the apron of the
pier causing considerable damage to the pier. The vessel sustained damage too. (Exhibit 7-Far Eastern
Shipping). Kavankov filed his sea protest (Exhibit 1-Vessel). Gavino submitted his report to the Chief
Pilot (Exhibit 1-Pilot) who referred the report to the Philippine Ports Authority (Exhibit 2-Pilot) Abellana
likewise submitted his report of the incident (Exhibit B).
Per contract and supplemental contract of the Philippine Ports Authority and the contractor for the
rehabilitation of the damaged pier, the same cost the Philippine Ports Authority the amount of
P1,126,132.25 (Exhibits D and E).iii[3]
On January 10, 1983, the Philippine Ports Authority (PPA, for brevity), through the Solicitor General, filed
before the Regional Trial Court of Manila, Branch 39, a complaint for a sum of money against Far Eastern
Shipping Co., Capt. Senen C. Gavino and the Manila Pilots Association, docketed as Civil Case No. 8314958,iv[4] praying that the defendants therein be held jointly and severally liable to pay the plaintiff
actual and exemplary damages plus costs of suit. In a decision dated August 1, 1985, the trial court
ordered the defendants therein jointly and severally to pay the PPA the amount of P1,053,300.00
representing actual damages and the cost of suit.v[5]
The defendants appealed to the Court of Appeals and raised the following issues: (1) Is the pilot of a
commercial vessel, under compulsory pilotage, solely liable for the damage caused by the vessel to the
pier, at the port of destination, for his negligence? And (2) Would the owner of the vessel be liable
likewise if the damage is caused by the concurrent negligence of the master of vessel and the pilot under
a compulsory pilotage?
As stated at the outset, respondent appellate court affirmed the findings of the court a quo except that it
found no employer-employee relationship existing between herein private respondents Manila Pilots
Association (MPA, for short) and Capt. Gavino.vi[6] This being so, it ruled instead that the liability of MPA
is anchored, not on Article 2180 of the Civil Code, but on the provisions of Customs Administrative Order
No. 15-65,vii[7] and accordingly modified said decision of the trial court by holding MPA, along with its codefendants therein, still solidarily liable to PPA but entitled MPA to reimbursement from Capt. Gavino for

such amount of the adjudged pecuniary liability in excess of the amount equivalent to seventy-five
percent (75%) of its prescribed reserve fund.viii[8]
Neither Far Eastern Shipping Co. (briefly, FESC) nor MPA was happy with the decision of the Court of
Appeals and both of them elevated their respective plaints to us via separate petitions for review on
certiorari.
In G.R. No. 130068, which was assigned to the Second Division of this Court, FESC imputed that the
Court of Appeals seriously erred:
1. in not holding Senen C. Gavino and the Manila Pilots Association as the parties solely responsible for
the resulting damages sustained by the pier deliberately ignoring the established jurisprudence on the
matter.
2. in holding that the master had not exercised the required diligence demanded from him by the
circumstances at the time the incident happened;
3. in affirming the amount of damages sustained by the respondent Philippine Ports Authority despite a
strong and convincing evidence that the amount is clearly exorbitant and unreasonable;
4. in not awarding any amount of counterclaim prayed for by the petitioner in its answer; and
5. in not granting herein petitioner's claim against pilot Senen C. Gavino and Manila Pilots' Association in
the event that it be held liable.ix[9]
Petitioner asserts that since the MV PAVLODAR was under compulsory pilotage at the time of the
incident, it was a compulsory pilot, Capt. Gavino, who was in command and had complete control in the
navigation and docking of the vessel. It is the pilot who supersedes the master for the time being in the
command and navigation of a ship and his orders must be obeyed in all respects connected with her
navigation. Consequently, he was solely responsible for the damage caused upon the pier apron, and
not the owners of the vessel. It claims that the master of the boat did not commit any act of negligence
when he failed to countermand or overrule the orders of the pilot because he did not see any justifiable
reason to do so. In other words, the master cannot be faulted for relying absolutely on the competence of
the compulsory pilot. If the master does not observe that a compulsory pilot is incompetent or physically
incapacitated, the master is justified in relying on the pilot.x[10]
Respondent PPA, in its comment, predictably in full agreement with the ruling of respondent court on the
solidary liability of FESC, MPA and Capt. Gavino, stresses the concurrent negligence of Capt. Gavino,
the harbor pilot, and Capt. Viktor Kabankov,* shipmaster of MV Pavlodar, as the basis of their solidary
liability for damages sustained by PPA. It posits that the vessel was being piloted by Capt. Gavino with
Capt. Kabankov beside him all the while on the bridge of the vessel, as the former took over the helm of
MV Pavlodar when it rammed and damaged the apron of the pier of Berth No. 4 of the Manila
International Port. Their concurrent negligence was the immediate and proximate cause of the collision
between the vessel and the pier - Capt. Gavino, for his negligence in the conduct of docking maneuvers
for the safe berthing of the vessel; and Capt. Kabankov, for failing to countermand the orders of the
harbor pilot and to take over and steer the vessel himself in the face of imminent danger, as well as for
merely relying on Capt. Gavino during the berthing procedure.xi[11]
On the other hand, in G.R. No. 130150, originally assigned to the Court's First Division and later
transferred to the Third Division, MPA, now as petitioner in this case, avers the respondent court's errors
consisted in disregarding and misinterpreting Customs Administrative Order No. 15-65 which limits the
liability of MPA. Said pilots' association asseverates that it should not be held solidarily liable with Capt.
Gavino who, as held by respondent court, is only a member, not an employee, thereof. There being no
employer-employee relationship, neither can MPA be held liable for any vicarious liability for the

respective exercise of profession by its members nor be considered a joint tortfeasor as to be held jointly
and severally liable.xii[12] It further argues that there was erroneous reliance on Customs Administrative
Order No. 15-65 and the constitution and by-laws of MPA, instead of the provisions of the Civil Code on
damages which, being a substantive law, is higher in category than the aforesaid constitution and by-laws
of a professional organization or an administrative order which bears no provision classifying the nature of
the liability of MPA for the negligence its member pilots.xiii[13]
As for Capt. Gavino, counsel for MPA states that the former had retired from active pilotage services
since July 28, 1994 and has ceased to be a member of petitioner pilots' association. He is not joined as a
petitioner in this case since his whereabouts are unknown.xiv[14]
FESC's comment thereto relied on the competence of the Court of Appeals in construing provisions of law
or administrative orders as basis for ascertaining the liability of MPA, and expressed full accord with the
appellate court's holding of solidary liability among itself, MPA and Capt. Gavino. It further avers that the
disputed provisions of Customs Administrative Order No. 15-65 clearly established MPA's solidary
liability.xv[15]
On the other hand, public respondent PPA, likewise through representations by the Solicitor General,
assumes the same supportive stance it took in G.R. No. 130068 in declaring its total accord with the
ruling of the Court of Appeals that MPA is solidarily liable with Capt. Gavino and FESC for damages, and
in its application to the fullest extent of the provisions of Customs Administrative Order No. 15-65 in
relation to MPA's constitution and by-laws which spell out the conditions of and govern their respective
liabilities. These provisions are clear and ambiguous as regards MPA's liability without need for
interpretation or construction. Although Customs Administrative Order No. 15-65 is a mere regulation
issued by an administrative agency pursuant to delegated legislative authority to fix details to implement
the law, it is legally binding and has the same statutory force as any valid statute.xvi[16]
Upon motionxvii[17] by FESC dated April 24, 1998 in G.R. No. 130150, said case was consolidated with
G.R. No. 130068.xviii[18]
Prefatorily, on matters of compliance with procedural requirements, it must be mentioned that the conduct
of the respective counsel for FESC and PPA leaves much to be desired, to the displeasure and
disappointment of this Court.
Section 2, Rule 42 of the 1997 Rules of Civil Procedurexix[19] incorporates the former Circular No. 28-91
which provided for what has come to be known as the certification against forum shopping as an
additional requisite for petitions filed with the Supreme Court and the Court of Appeals, aside from the
other requirements contained in pertinent provisions of the Rules of Court therefor, with the end in view of
preventing the filing of multiple complaints involving the same issues in the Supreme Court, Court of
Appeals or different divisions thereof or any other tribunal or agency.
More particularly, the second paragraph of Section 2, Rule 42 provides:
xxx

xxx

xxx

The petitioner shall also submit together with the petition a certification under oath that he has not
therefore commenced any other action involving the same issues in the Supreme Court, the Court of
Appeals or different divisions thereof, or any other tribunal or agency; if there is such other action or
proceeding, he must state the status of the same; and if he should thereafter learn that a similar action or
proceeding has been filed or is pending before the Supreme Court, the Court of Appeals or different
divisions thereof, or any other tribunal or agency, he undertakes to promptly inform the aforesaid courts
and other tribunal or agency thereof within five (5) days therefrom. (Italics supplied.)

For petitions for review filed before the Supreme Court, Section 4(e), Rule 45 specifically requires that
such petition shall contain a sworn certification against forum shopping as provided in the last paragraph
of Section 2, Rule 42.
The records show that the law firm of Del Rosario and Del Rosario through its associate, Atty. Herbert A.
Tria, is the counsel of record for FESC in both G.R. No. 130068 and G.R. No. 130150.
G.R. No. 130068, which is assigned to the Court's Second Division, commenced with the filing by FESC
through counsel on August 22, 1997 of a verified motion for extension of time to file its petition for thirty
(30) days from August 28, 1997 or until September 27, 1997.xx[20] Said motion contained the following
certification against forum shoppingxxi[21] signed by Atty. Herbert A. Tria as affiant:
CERTIFICATION
AGAINST FORUM SHOPPING
I/we hereby certify that I/we have not commenced any other action or proceeding involving the same
issues in the Supreme Court, the Court of Appeals, or any other tribunal or agency; that to the best of my
own knowledge, no such action or proceeding is pending in the Supreme Court, the Court of Appeals, or
any other tribunal or agency; that if I/we should thereafter learn that a similar action or proceeding has
been filed or is pending before the Supreme Court, the Court of Appeals, or any other tribunal or agency,
I/we undertake to report that fact within five (5) days therefrom to this Honorable Court.
This motion having been granted, FESC subsequently filed its petition on September 26, 1997, this time
bearing a "verification and certification against forum-shopping" executed by one Teodoro P. Lopez on
September 24, 1997,xxii[22] to wit:
VERIFICATION AND CERTIFICATION
AGAINST FORUM SHOPPING
in compliance with Section 4(e), Rule 45 in relation to Section 2, Rule 42 of the Revised Rules of Civil
Procedure
I, Teodoro P. Lopez, of legal age, after being duly sworn, depose and state:
1. That I am the Manager, Claims Department of Filsov Shipping Company, the local agent of petitioner in
this case.
2. That I have caused the preparation of this Petition for Review on Certiorari.
3. That I have read the same and the allegations therein contained are true and correct based on the
records of this case.
4. That I certify that petitioner has not commenced any other action or proceeding involving the same
issues in the Supreme Court or Court of Appeals, or any other tribunal or agency, that to the best of my
own knowledge, no such action or proceeding is pending in the Supreme Court, the Court of Appeals or
any other tribunal or agency, that I should thereafter learn that a similar action or proceeding has been
filed or is pending before the Supreme Court, the Court of Appeals, or any other tribunal or agency, I
undertake to report the fact within five (5) days therefrom to this Honorable Court. (Italics supplied for
emphasis.)
Reviewing the records, we find that the petition filed by MPA in G.R. No. 130150 then pending with the
Third Division was duly filed on August 29, 1997 with a copy thereof furnished on the same date by

registered mail to counsel for FESC.xxiii[23] Counsel of record for MPA, Atty. Jesus P. Amparo, in his
verification accompanying said petition dutifully revealed to the Court that-xxx

xxx

xxx

3. Petitioner has not commenced any other action or proceeding involving the same issues in his
Honorable Court, the Court of Appeals or different Divisions thereof, or any other tribunal or agency, but
to the best of his knowledge, there is an action or proceeding pending in this Honorable Court, entitled
Far Eastern Shipping Co., Petitioner, vs. Philippine Ports Authority and Court of Appeals with a Motion for
Extension of time to file Petition for Review by Certiorari filed sometime on August 18, 1997. If
undersigned counsel will come to know of any other pending action or claim filed or pending he
undertakes to report such fact within five (5) days to this Honorable Court.xxiv[24] (Italics supplied.)
Inasmuch as MPA's petition in G.R. No. 130150 was posted by registered mail on August 29, 1997 and
taking judicial notice of the average period of time it takes local mail to reach its destination, by
reasonable estimation it would be fair to conclude that when FESC filed its petition in G.R. No. 130068 on
September 26, 1997, it would already have received a copy of the former and would then have
knowledge of the pendency of the other petition initially filed with the First Division. It was therefore
incumbent upon FESC to inform the Court of that fact through its certification against forum shopping.
For failure to make such disclosure, it would appear that the aforequoted certification accompanying the
petition in G.R. No. 130068 is defective and could have been a ground for dismissal thereof.
Even assuming that FESC has not yet received its copy of MPA's petition at the time it filed its own
petition and executed said certification, its signatory did state "that if I should thereafter learn that a similar
action or proceeding has been filed or is pending before the Supreme Court, the Court of Appeals or any
other tribunal or agency, I undertake to report the fact within five (5) days therefrom in this Honorable
Court."xxv[25] Scouring the records page by page in this case, we find that no manifestation concordant
with such undertaking was then or at any other time thereafter ever filed by FESC nor was there any
attempt to bring such matter to the attention of the Court. Moreover, it cannot feign non-knowledge of the
existence of such other petition because FESC itself filed the motion for consolidation in G.R. No. 130150
of these two cases on April 24, 1998.
It is disturbing to note that counsel for FESC, the law firm of Del Rosario and Del Rosario, displays an
unprofessional tendency of taking the Rules for granted, in this instance exemplified by its pro forma
compliance therewith but apparently without full comprehension of and with less than faithful commitment
to its undertakings to this Court in the interest of just, speedy and orderly administration of court
proceedings.
As between the lawyer and the courts, a lawyer owes candor, fairness and good faith to the court.xxvi[26]
He is an officer of the court exercising a privilege which is indispensable in the administration of
justice.xxvii[27] Candidness, especially towards the courts, is essential for the expeditious administration
of justice. Courts are entitled to expect only complete honesty from lawyers appearing and pleading
before them.xxviii[28] Candor in all dealings is the very essence of honorable membership in the legal
profession.xxix[29] More specifically, a lawyer is obliged to observe the rules of procedure and not to
misuse them to defeat the ends of justice.xxx[30] It behooves a lawyer, therefore, to exert every effort and
consider it his duty to assist in the speedy and efficient administration of justice.xxxi[31] Being an officer
of the court, a lawyer has a responsibility in the proper administration of justice. Like the court itself, he is
an instrument to advance its ends -- the speedy, efficient, impartial, correct and inexpensive adjudication
of cases and the prompt satisfaction of final judgments. A lawyer should not only help attain these
objectives but should likewise avoid any unethical or improper practices that impede, obstruct or prevent
their realization, charged as he is with the primary task of assisting in the speedy and efficient
administration of justice.xxxii[32]

Sad to say, the members of said law firm sorely failed to observe their duties as responsible members of
the Bar. Their actuations are indicative of their predisposition to take lightly the avowed duties of officers
of the Court to promote respect for law and for legal processes.xxxiii[33] We cannot allow this state of
things to pass judicial muster.
In view of the fact that at around the time these petitions were commenced, the 1997 Rules of Civil
Procedure had just taken effect, the Court treated infractions of the new Rules then with relative liberality
in evaluating full compliance therewith. Nevertheless, it would do well to remind all concerned that the
penal provisions of Circular No. 28-91 which remain operative provides, inter alia:
3. Penalties.xxx

xxx

xxx

(c) The submission of a false certification under Par. 2 of the Circular shall likewise constitute contempt
of court, without prejudice to the filing of criminal action against the guilty party. The lawyer may also be
subjected to disciplinary proceedings.
It must be stressed that the certification against forum shopping ordained under the Rules is to be
executed by the petitioner, and not by counsel. Obviously it is the petitioner, and not always the counsel
whose professional services have been retained for a particular case, who is in the best position to know
whether he or it actually filed or caused the filing of a petition in that case. Hence, a certification against
forum shopping by counsel is a defective certification. It is clearly equivalent to non-compliance with the
requirement under Section 2, Rule 42 in relation to Section 4, Rule 45, and constitutes a valid cause for
dismissal of the petition.
Hence, the initial certification appended to the motion for extension of time to file petition n G.R. No.
130068 executed in behalf of FESC by Atty. Tria is procedurally deficient. But considering that it was a
superfluity at that stage of the proceeding, it being unnecessary to file such a certification with a mere
motion for extension, we shall disregard such error. Besides, the certification subsequently executed by
Teodoro P. Lopez in behalf of FESC cures that defect to a certain extent, despite the inaccuracies earlier
pointed out. In the same vein, we shall consider the verification signed in behalf of MPA by its counsel,
Atty. Amparo, in G.R. No. 130150 as substantial compliance inasmuch as it served the purpose of the
Rules of informing the Court of the pendency of another action or proceeding involving the same issues.
It bears stressing that procedural rules are instruments in the speedy and efficient administration of
justice. They should be used to achieve such end and not to derail it.xxxiv[34]
Counsel for PPA did not make matters any better. Despite the fact that, save for the Solicitor General at
the time, the same legal team of the Office of the Solicitor General (OSG, for short) composed of
Assistant Solicitor General Roman G. Del Rosario and Solicitor Luis F. Simon, with the addition of
Assistant Solicitor General Pio C. Guerrero very much later in the proceedings, represented PPA
throughout the appellate proceedings in both G.R. No. 130068 and G.R. No. 130150 and was presumably
fully acquainted with the facts and issues of the case, it took the OSG an inordinately and almost
unreasonably long period of time to file its comment, thus unduly delaying the resolution of these cases.
It took several changes of leadership in the OSG -- from Silvestre H. Bello III to Romeo C. dela Cruz and,
finally, Ricardo P. Galvez -- before the comment in behalf of PPA was finally filed.
In G.R. No. 130068, it took eight (8) motions for extension of time totaling 210 days, a warning that no
further extensions shall be granted, and personal service on the Solicitor General himself of the resolution
requiring the filing of such comment before the OSG indulged the Court with the long required comment
on July 10, 1998.xxxv[35] This, despite the fact that said office was required to file its comment way back
on November 12, 1997.xxxvi[36] A closer scrutiny of the records likewise indicates that petitioner FESC
was not even furnished a copy of said comment as required by Section 5, Rule 42. Instead, a copy

thereof was inadvertently furnished to MPA which, from the point of view of G.R. No. 130068, was a nonparty.xxxvii[37] The OSG fared slightly better in G.R. No. 130150 in that it took only six (6) extensions, or
a total of 180 days, before the comment was finally filed.xxxviii[38] And while it properly furnished
petitioner MPA with a copy of its comment, it would have been more desirable and expedient in this case
to have furnished its therein co-respondent FESC with a copy thereof, if only as a matter of professional
courtesy.xxxix[39]
This undeniably dilatory disinclination of the OSG to seasonably file required pleadings constitutes
deplorable disservice to the tax-paying public and can only be categorized as censurable inefficiency on
the part of the government law office. This is most certainly professionally unbecoming of the OSG.
Another thing that baffles the Court is why the OSG did not take the initiative of filing a motion for
consolidation in either G.R. No. 130068 or G.R. No. 130150, considering its familiarity with the
background of the case and if only to make its job easier by having to prepare and file only one comment.
It could not have been unaware of the pendency of one or the other petition because, being counsel for
respondent in both cases, petitioner is required to furnish it with a copy of the petition under pain of
dismissal of the petition for failure otherwise.xl[40]
Besides, in G.R. 130068, it prefaces its discussions thus -Incidentally, the Manila Pilots' Association (MPA), one of the defendants-appellants in the case before the
respondent Court of Appeals, has taken a separate appeal from the said decision to this Honorable Court,
which was docketed as G.R. No. 130150 and entitled "Manila Pilots' Association, Petitioner, versus
Philippine Ports Authority and Far Eastern Shipping Co., Respondents.xli[41]
Similarly, in G.R. No. 130150, it states Incidentally, respondent Far Eastern Shipping Co. (FESC) had also taken an appeal from the said
decision to this Honorable Court, docketed as G.R. No. 130068, entitled "Far Eastern Shipping Co. vs.
Court of Appeals and Philippine Ports Authority."xlii[42]
We find here a lackadaisical attitude and complacency on the part of the OSG in the handling of its cases
and an almost reflexive propensity to move for countless extensions, as if to test the patience of the
Court, before favoring it with the timely submission of required pleadings.
It must be emphasized that the Court can resolve cases only as fast as the respective parties in a case
file the necessary pleadings. The OSG, be needlessly extending the pendency of these cases through its
numerous motions for extension, came very close to exhausting this Court's forbearance and has
regrettably fallen short of its duties as the People's Tribune.
The OSG is reminded that just like other members of the Bar, the canons under the Code of Professional
Responsibility apply with equal force on lawyers in government service in the discharge of their official
tasks.xliii[43] These ethical duties are rendered even more exacting as to them because, as government
counsel, they have the added duty to abide by the policy of the State to promote a high standard of ethics
in public service.xliv[44] Furthermore, it is incumbent upon the OSG, as part of the government
bureaucracy, to perform and discharge its duties with the highest degree of professionalism, intelligence
and skillxlv[45] and to extend prompt, courteous and adequate service to the public.xlvi[46]
Now, on the merits of the case. After a judicious examination of the records of this case, the pleadings
filed, and the evidence presented by the parties in the two petitions, we find no cogent reason to reverse
and set aside the questioned decision. While not entirely a case of first impression, we shall discuss the
issues seriatim and, correlatively by way of a judicial once-over, inasmuch as the matters raised in both
petitions beg for validation and updating of well worn maritime jurisprudence. Thereby, we shall write finis

to the endless finger-pointing in this shipping mishap which has been stretched beyond the limits of
judicial tolerance.
The Port of Manila is within the Manila Pilotage District which is under compulsory pilotage pursuant to
Section 8, Article III of Philippine Ports Authority Administrative Order No. 03-85,xlvii[47] which provides
that:
SEC. 8. Compulsory Pilotage Service.- For entering a harbor and anchoring thereat, or passing through
rivers or straits within a pilotage district, as well as docking and undocking at any pier/wharf, or shifting
from one berth or another, every vessel engaged in coastwise and foreign trade shall be under
compulsory pilotage. x x x
In case of compulsory pilotage, the respective duties and responsibilities of the compulsory pilot and the
master have been specified by the same regulation in this wise:
SEC. 11. Control of vessels and liability for damage. - On compulsory pilotage grounds, the Harbor Pilot,
providing the service to a vessel shall be responsible for the damage caused to a vessel or to life and
property at ports due to his negligence or fault. He can only be absolved from liability if the accident is
caused by force majeure or natural calamities provided he has exercised prudence and extra diligence to
prevent or minimize damage.
The Master shall retain overall command of the vessel even on pilotage grounds whereby he can
countermand or overrule the order or command of the Harbor Pilot on board. In such event, any damage
caused to a vessel or to life and property at ports by reason of the fault or negligence of the Master shall
be the responsibility and liability of the registered owner of the vessel concerned without prejudice to
recourse against said Master.
Such liability of the owner or Master of the vessel or its pilots shall be determined by competent authority
in appropriate proceedings in the light of the facts and circumstances of each particular case.
SEC. 32. Duties and responsibilities of the Pilot or Pilots' Association. - The duties and responsibilities of
the Harbor Pilot shall be as follows:
xxx

xxx

xxx

f) a pilot shall be held responsible for the direction of a vessel from the time he assumes his work as a
pilot thereof until he leaves it anchored or berthed safely; Provided, however, that his responsibility shall
cease at the moment the Master neglects or refuses to carry out his order.
Customs Administrative Order No. 15-65 issued twenty years earlier likewise provided in Chapter I
thereof for the responsibilities of pilots:
Par. XXXIX. - A Pilot shall be held responsible for the direction of a vessel from the time he assumes
control thereof until he leaves it anchored free from shoal; Provided, That his responsibility shall cease at
the moment the master neglects or refuses to carry out his instructions.
xxx

xxx

xxx

Par. XLIV. - Pilots shall properly and safely secure or anchor vessels under their control when requested
to do so by the master of such vessels.
I. G.R. No. 130068

Petitioner FESC faults the respondent court with serious error in not holding MPA and Capt. Gavino
solely responsible for the damages caused to the pier. It avers that since the vessel was under
compulsory pilotage at the time with Capt. Gavino in command and having exclusive control of the vessel
during the docking maneuvers, then the latter should be responsible for damages caused to the
pier.xlviii[48] It likewise holds the appellate court in error for holding that the master of the ship, Capt.
Kabankov, did not exercise the required diligence demanded by the circumstances.xlix[49]
We start our discussion of the successive issues bearing in mind the evidentiary rule in American
jurisprudence that there is a presumption of fault against a moving vessel that strikes a stationary object
such as a dock or navigational aid. In admiralty, this presumption does more than merely require the ship
to go forward and produce some evidence on the presumptive matter. The moving vessel must show that
it was without fault or that the collision was occasioned by the fault of the stationary object or was the
result of inevitable accident. It has been held that such vessel must exhaust every reasonable possibility
which the circumstances admit and show that in each, they did all that reasonable care required.l[50] In
the absence of sufficient proof in rebuttal, the presumption of fault attaches to a moving vessel which
collides with a fixed object and makes a prima facie case of fault against the vessel.li[51] Logic and
experience support this presumption:
The common sense behind the rule makes the burden a heavy one. Such accidents simply do not occur
in the ordinary course of things unless the vessel has been mismanaged in some way. It is not sufficient
for the respondent to produce witnesses who testify that as soon as the danger became apparent
everything possible was done to avoid an accident. The question remains, How then did the collision
occur? The answer must be either that, in spite of the testimony of the witnesses, what was done was
too little or too late or, if not, then the vessel was at fault for being in a position in which an unavoidable
collision would occur.lii[52]
The task, therefore, in these cases is to pinpoint who was negligent - the master of the ship, the harbor
pilot or both.
A pilot, in maritime law, is a person duly qualified, and licensed, to conduct a vessel into or out of
ports, or in certain waters. In a broad sense, the term "pilot" includes both (1) those whose duty it is to
guide vessels into or out of ports, or in particular waters and (2) those entrusted with the navigation of
vessels on the high seas.liii[53] However, the term "pilot" is more generally understood as a person taken
on board at a particular place for the purpose of conducting a ship through a river, road or channel, or
from a port.liv[54]
Under English and American authorities, generally speaking, the pilot supersedes the master for the
time being in the command and navigation of the ship, and his orders must be obeyed in all matters
connected with her navigation. He becomes the master pro hac vice and should give all directions as to
speed, course, stopping and reversing, anchoring, towing and the like. And when a licensed pilot is
employed in a place where pilotage is compulsory, it is his duty to insist on having effective control of the
vessel, or to decline to act as pilot. Under certain systems of foreign law, the pilot does not take entire
charge of the vessel, but is deemed merely the adviser of the master, who retains command and control
of the navigation even on localities where pilotage is compulsory.lv[55]
It is quite common for states and localities to provide for compulsory pilotage, and safety laws have
been enacted requiring vessels approaching their ports, with certain exceptions, to take on board pilots
duly licensed under local law. The purpose of these laws is to create a body of seamen thoroughly
acquainted with the harbor, to pilot vessels seeking to enter or depart, and thus protect life and property
from the dangers of navigation.lvi[56]
In line with such established doctrines, Chapter II of Customs Administrative Order No. 15-65
prescribes the rules of compulsory pilotage in the covered pilotage districts, among which is the Manila
Pilotage District, viz. --

PARAGRAPH I. - Pilotage for entering a harbor and anchoring thereat, as well as docking and
undocking in any pier or shifting from one berth to another shall be compulsory, except Government
vessels and vessels of foreign governments entitled to courtesy, and other vessels engaged solely in river
or harbor work, or in a daily ferry service between ports which shall be exempt from compulsory pilotage
provisions of these regulations: provided, however, that compulsory pilotage shall not apply in pilotage
districts whose optional pilotage is allowed under these regulations.
Pursuant thereto, Capt. Gavino was assigned to pilot MV Pavlodar into Berth 4 of the Manila
International Port. Upon assuming such office as compulsory pilot, Capt. Gavino is held to the universally
accepted high standards of care and diligence required of a pilot, whereby he assumes to have skill and
knowledge in respect to navigation in the particular waters over which his license extends superior to and
more to be trusted than that of the master.lvii[57] A pilot should have a thorough knowledge of general
and local regulations and physical conditions affecting the vessel in his charge and the waters for which
he is licensed, such as a particular harbor or river. He is not held to the highest possible degree of skill
and care, but must have and exercise the ordinary skill and care demanded by the circumstances, and
usually shown by an expert in his profession. Under extraordinary circumstances, a pilot must exercise
extraordinary care.lviii[58]
In Atlee vs. The Northwestern Union Packet Company,lix[59] Mr. Justice Miller spelled out in great
detail the duties of a pilot:
x x x (T)he pilot of a river steamer, like the harbor pilot, is selected for his personal knowledge of the
topography through which he steers his vessel. In the long course of a thousand miles in one of these
rivers, he must be familiar with the appearance of the shore on each side of the river as he goes along.
Its banks, towns, its landings, its houses and trees, are all landmarks by which he steers his vessel. The
compass is of little use to him. He must know where the navigable channel is, in its relation to all these
external objects, especially in the night. He must also be familiar with all dangers that are permanently
located in the course of the river, as sand-bars, snags, sunken rocks or trees or abandoned vessels or
barges. All this he must know and remember and avoid. To do this, he must be constantly informed of
the changes in the current of the river, of the sand-bars newly made, of logs or snags, or other objects
newly presented, against which his vessel might be injured.
xxx

xxx

xxx

It may be said that this is exacting a very high order of ability in a pilot. But when we consider the
value of the lives and property committed to their control, for in this they are absolute masters, the high
compensation they receive, the care which Congress has taken to secure by rigid and frequent
examinations and renewal of licenses, this very class of skill, we do not think we fix the standard too high.
Tested thereby, we affirm respondent court's finding that Capt. Gavino failed to measure up to such
strict standard of care and diligence required of pilots in the performance of their duties. Witness this
testimony of Capt. Gavino:
Court:
You have testified before that the reason why the vessel bumped the pier was because the anchor was
not released immediately or as soon as you have given the order. Do you remember having stated that?
A

Yes, your Honor.

And you gave this order to the captain of the vessel?

Yes, your Honor.

Q
By that testimony, you are leading the Court to understand that is that anchor was released
immediately at the time you gave the order, the incident would not have happened. Is that correct?
A
Yes, sir, but actually it was only a presumption on my part because there was a commotion
between the officers who are in charge of the dropping of the anchor and the captain. I could not
understand their language, it was in Russian, so I presumed the anchor was not dropped on time.
Q

So, you are not sure whether it was really dropped on time or not?

I am not sure, your Honor.

xxx

xxx

xxx

Q
You are not even sure what could have caused the incident. What factor could have caused the
incident?
A
Well, in this case now, because either the anchor was not dropped on time or the anchor did not
hold, that was the cause of the incident, your Honor.lx[60]
It is disconcertingly riddled with too much incertitude and manifests a seeming indifference for the
possibly injurious consequences his commands as pilot may have. Prudence required that he, as pilot,
should have made sure that his directions were promptly and strictly followed. As correctly noted by the
trial court Moreover, assuming that he did indeed give the command to drop the anchor on time, as pilot he
should have seen to it that the order was carried out, and he could have done this in a number of ways,
one of which was to inspect the bow of the vessel where the anchor mechanism was installed. Of course,
Captain Gavino makes reference to a commotion among the crew members which supposedly caused
the delay in the execution of the command. This account was reflected in the pilot's report prepared four
hours later, but Capt. Kavankov, while not admitting whether or not such a commotion occurred,
maintained that the command to drop anchor was followed "immediately and precisely." Hence, the Court
cannot give much weight or consideration to this portion of Gavino's testimony."lxi[61]
An act may be negligent if it is done without the competence that a reasonable person in the position
of the actor would recognize as necessary to prevent it from creating an unreasonable risk of harm to
another.lxii[62] Those who undertake any work calling for special skills are required not only to exercise
reasonable care in what they do but also possess a standard minimum of special knowledge and
ability.lxiii[63]
Every man who offers his services to another, and is employed, assumes to exercise in the
employment such skills he possesses, with a reasonable degree of diligence. In all these employments
where peculiar skill is requisite, if one offers his services he is understood as holding himself out to the
public as possessing the degree of skill commonly possessed by others in the same employment, and if
his pretensions are unfounded he commits a species of fraud on every man who employs him in reliance
on his public profession.lxiv[64]
Furthermore, there is an obligation on all persons to take the care which, under ordinary
circumstances of the case, a reasonable and prudent man would take, and the omission of that care
constitutes negligence.lxv[65] Generally, the degree of care required is graduated according to the
danger a person or property attendant upon the activity which the actor pursues or the instrumentality
which he uses. The greater the danger the greater the degree of care required. What is ordinary under
extraordinary of conditions is dictated by those conditions; extraordinary risk demands extraordinary care.
Similarly, the more imminent the danger, the higher the degree of care.lxvi[66]

We give our imprimatur to the bases for the conclusion of the Court of Appeals that Capt. Gavino
was indeed negligent in the performance of his duties:
xxx

xxx

xxx

x x x As can be gleaned from the logbook, Gavino ordered the left anchor and two (2) shackles
dropped at 8:30 o'clock in the morning. He ordered the engines of the vessel stopped at 8:31 o'clock. By
then, Gavino must have realized that the anchor did not hit a hard object and was not clawed so as to
reduce the momentum of the vessel. In point of fact, the vessel continued travelling towards the pier at
the same speed. Gavino failed to react. At 8:32 o'clock, the two (2) tugboats began to push the stern
part of the vessel from the port side but the momentum of the vessel was not contained. Still, Gavino did
not react. He did not even order the other anchor and two (2) more shackles dropped to arrest the
momentum of the vessel. Neither did he order full-astern. It was only at 8:34 o'clock, or four (4) minutes,
after the anchor was dropped that Gavino reacted. But his reaction was even (haphazard) because
instead of arresting fully the momentum of the vessel with the help of the tugboats, Gavino ordered
merely "half-astern". It took Gavino another minute to order a "full-astern". By then, it was too late. The
vessel's momentum could no longer be arrested and, barely a minute thereafter, the bow of the vessel hit
the apron of the pier. Patently, Gavino miscalculated. He failed to react and undertake adequate
measures to arrest fully the momentum of the vessel after the anchor failed to claw to the seabed. When
he reacted, the same was even (haphazard). Gavino failed to reckon the bulk of the vessel, its size and
its cargo. He erroneously believed that only one (1) anchor would suffice and even when the anchor
failed to claw into the seabed or against a hard object in the seabed, Gavino failed to order the other
anchor dropped immediately. His claim that the anchor was dropped when the vessel was only 1,000
feet from the pier is but a belated attempt to extricate himself from the quagmire of his own insouciance
and negligence. In sum, then, Appellants' claim that the incident was caused by "force majeure" is barren
of factual basis.
xxx

xxx

xxx

The harbor pilots are especially trained for this job. In the Philippines, one may not be a harbor pilot
unless he passed the required examination and training conducted then by the Bureau of Custom, under
Customs Administrative Order No. 15-65, now under the Philippine Ports Authority under PPA
Administrative Order 63-85. Paragraph XXXIX of the Customs Administrative Order No. 15-65 provides
that "the pilot shall be held responsible for the direction of the vessel from the time he assumes control
thereof, until he leaves it anchored free from shoal: Provided, that his responsibility shall cease at the
moment the master neglects or refuse(s) to carry out his instructions." The overall direction regarding the
procedure for docking and undocking the vessel emanates from the harbor pilot. In the present recourse,
Gavino failed to live up to his responsibilities and exercise reasonable care or that degree of care
required by the exigencies of the occasion. Failure on his part to exercise the degree of care demanded
by the circumstances is negligence (Reese versus Philadelphia & RR Co. 239 US 463, 60 L ed. 384, 57
Am Jur. 2d 12age 418).lxvii[67]
This affirms the findings of the trial court regarding Capt. Gavino's negligence:
This discussion should not however, divert the court from the fact that negligence in manuevering
the vessel must be attributed to Capt. Senen Gavino. He was an experienced pilot and by this time
should have long familiarized himself with the depth of the port and the distance he could keep between
the vessel and port in order to berth safely.lxviii[68]
The negligence on the part of Capt. Gavino is evident; but Capt. Kabankov is no less responsible
for the allision. His unconcerned lethargy as master of the ship in the face of troublous exigence
constitutes negligence.

While it is indubitable that in exercising his functions a pilot-is in sole command of the shiplxix[69]
and supersedes the master for the time being in the command and navigation of a ship and that he
becomes master pro hac vice of a vessel piloted by him,lxx[70] there is overwhelming authority to the
effect that the master does not surrender his vessel to the pilot and the pilot is not the master. The master
is still in command of the vessel notwithstanding the presence of a pilot. There are occasions when the
master may and should interfere and even displace the pilot, as when the pilot is obviously incompetent
or intoxicated and the circumstances may require the master to displace a compulsory pilot because of
incompetency or physical incapacity. If, however, the master does not observe that a compulsory pilot is
incompetent or physically incapacitated, the master is justified in relying on the pilot, but not
blindly.lxxi[71]
The master is not wholly absolved from his duties while a pilot is on board his vessel, and may
advise with or offer suggestions to him. He is still in command of the vessel, except so far as her
navigation is concerned, and must cause the ordinary work of the vessel to be properly carried on and the
usual precaution taken. Thus, in particular, he is bound to see that there is sufficient watch on deck, and
that the men are attentive to their duties, also that engines are stopped, towlines cast off, and the anchors
clear and ready to go at the pilot's order.lxxii[72]
A perusal of Capt. Kabankov's testimony makes it apparent that he was remiss in the discharge of
his duties as master of the ship, leaving the entire docking procedure up to the pilot, instead of
maintaining watchful vigilance over this risky maneuver:
Q
Will you please tell us whether you have the right to intervene in docking of your ship in the
harbor?
A
No sir, I have no right to intervene in time of docking, only in case there is imminent danger to the
vessel and to the pier.
Q

Did you ever intervene during the time that your ship was being docked by Capt. Gavino?

No sir, I did not intervene at the time when the pilot was docking my ship.

Up to the time it was actually docked at the pier, is that correct'?

No sir, I did not intervene up to the very moment when the vessel was docked.

xxx

xxx

xxx

Atty. Del Rosario (to the witness)

Q
Mr. Witness, what happened, if any, or was there anything unusual that happened during the
docking?
A

Yes sir, our ship touched the pier and the pier was damaged.

Court (to the witness)

Q
When you said touched the pier, are you leading the court to understand that your ship bumped
the pier?
A

I believe that my vessel only touched the pier but the impact was very weak.

Do you know whether the pier was damaged as a result of that slight or weak impact?

Yes sir, after the pier was damaged.

xxx

xxx

xxx

Q
Being most concerned with the safety of your vessel, in the maneuvering of your vessel, to the
port, did you observe anything irregular in the maneuvering by Capt. Gavino at the time he was trying to
cause the vessel to be docked at the pier?
A

You mean the action of Capt. Gavino or his condition?

Court:
Q

Not the actuation that conform to the safety maneuver of the ship to the harbor?

No sir, it was a usual docking.

Q
By that statement of yours, you are leading the court to understand that there was nothing
irregular in the docking of the ship?
A

Yes sir, during the initial period, of the docking, there was nothing unusual that happened.

Q
What about in the last portion of the docking of the ship, was there anything unusual or abnormal
that happened?
A
None Your Honor, I believe that Capt. Gavino thought that the anchor could keep or hold the
vessel.
Q
You want us to understand, Mr. Witness, that the dropping of the anchor of the vessel was not
timely?
A
I don't know the depth of this port but I think, if the anchor was dropped earlier and with more
shackles, there could not have been an incident.
Q
So you could not precisely tell the court that the dropping of the anchor was timely because you
are not well aware of the seabed, is that correct?
A

Yes sir, that, is right.

xxx

xxx

xxx

Q
Alright, Capt. Kavankov, did you come to know later whether the anchor held its ground so much
so that the vessel could not travel?
A

It is difficult for me to say definitely. I believe that the anchor did not hold the ship.

Q
You mean you don't know whether the anchor blades stuck to the ground to stop the ship from
further moving?
A

Yes sir, it is possible.

What is possible?

I think, the 2 shackles were not enough to hold the vessel.

Did you know that the 2 shackles were dropped?

Yes sir, I knew that.

Q
If you knew that the shackles were not enough to hold the ship, did you not make any protest to
the pilot?
A

No sir, after the incident, that was my assumption.

Did you come to know later whether that presumption is correct?

I still don't know the ground in the harbor or the depths.

Q
So from the beginning, you were not competent whether the 2 shackles were also dropped to
hold the ship?
A
No sir, at the beginning, I did not doubt it because I believe Capt. Gavino to be an experienced
pilot and he should be more aware as to the depths of the harbor and the ground and I was confident in
his actions.
xxx

xxx

xxx

Solicitor Abad (to the witness)

Q
Now, you were standing with the pilot on the bridge of the vessel before the incident happened,
were you not?
A

Yes sir, all the time, I was standing with the pilot.

And so whatever the pilot saw, you could also see from that point of view?

That is right.

Whatever the pilot can read from the panel of the bridge, you also could read, is that correct?

What is the meaning of panel'?

All indications necessary for men on the bridge to be informed of the movements of the ship?

That is right.

Q
hear?

And whatever sound the captain... Capt. Gavino would hear from the bridge, you could also

That is right.

Q
right?

Now, you said that when the command to lower the anchor was given, it was obeyed, is that

This command was executed by the third mate and boatswain.

Court (to the witness)

Q
Mr. Witness, earlier in today's hearing, you said that you did not intervene with the duties of the
pilot and that, in your opinion, you can only intervene if the ship is placed in imminent danger, is that
correct?
A

That is right, I did say that.

Q
In your observation before the incident actually happened, did you observe whether or not the
ship, before the actual incident, the ship was placed in imminent danger?.
A

No sir, I did not observe.

Q
By that answer, are you leading the court to understand that because you did not intervene and
because you believed that it was your duty to intervene when the vessel is placed in imminent danger to
which you did not observe any imminent danger thereof, you have not intervened in any manner to the
command of the pilot?
A

That is right, sir.

xxx

xxx

xxx

Q
Assuming that you disagreed with the pilot regarding the step being taken by the pilot in
maneuvering the vessel. whose command will prevail, in case of imminent danger to the vessel?
A
I did not consider the situation as having an imminent danger. I believed that the vessel will dock
alongside the pier.
Q
You want us to understand that you did not see an imminent danger to your ship, is that what you
mean?
A

Yes sir, up to the very last moment, I believed that there was no imminent danger.

Because of that, did you ever intervene in the command of the pilot?

Yes sir, I did not intervene because I believed that the command of the pilot to be correct.

Solicitor Abad (to the witness)

Q

As a captain of M/V Pavlodar, you consider docking maneuvers a serious matter, is it not?

Yes sir, that is right.

Q
Since it affects not only the safety of the port or pier, but also the safety of the vessel and the
cargo, is it not?
A

That is right.

Q
So that, I assume that you were watching Capt. Gavino very closely at the time he was making
his commands?
A

I was close to him, I was hearing his command and being executed.

Q
And that you were also alert for any possible mistakes he might commit in the maneuvering of the
vessel?
A

Yes sir, that is right.

Q
But at no time during the maneuver did you issue order contrary to the orders Capt. Gavino
made?
A

No sir.

So that you were in full accord with all of Capt. Gavino's orders?

Yes sir.

Because, otherwise, you would have issued order that would supersede his own order?

In that case, I should take him away from his command or remove the command from him.

Court (to the witness)

Q
You were in full accord with the steps being taken by Capt. Gavino because you relied on his
knowledge, on his familiarity of the seabed and shoals and other surroundings or conditions under the
sea, is that correct?
A

Yes sir, that is right.

xxx

xxx

xxx

Solicitor Abad (to the witness)

Q
And so after the anchors were ordered dropped and they did not take hold of the seabed, you
were alerted that there was danger already on hand?
A

No sir, there was no imminent danger to the vessel.

Q
Do you mean to tell us that even if the anchor was supposed to take hold of the bottom and it did
not, there was no danger to the ship?
A

Yes sir, because the anchor dragged on the ground later.

Q
And after a few moments when the anchor should have taken hold the seabed but not done (sic),
as you expected, you already were alerted that there was danger to the ship, is that correct?
A

Yes sir, I was alerted but there was no danger.

And you were alerted that somebody was wrong?

Yes sir, I was alerted.

And this alert you assumed was the ordinary alertness that you have for normal docking?

Yes sir, I mean that it was usual condition of any man in time of docking to be alert.

And that is the same alertness when the anchor did not hold onto the ground, is that correct?

Yes sir, me and Capt. Gavino (thought) that the anchor will hold the ground.

Q
Since, as you said that you agreed all the while with the orders of Capt. Gavino, you also
therefore agreed with him in his failure to take necessary precaution against the eventuality that the
anchor will not hold as expected?
Atty. Del Rosario:
May I ask that the question ...
Solicitor Abad:
Never mind, I will reform the question.
xxx

xxx

xxx

Solicitor Abad (to the witness)

Q

Is it not a fact that the vessel bumped the pier?

That is right, it bumped the pier.

For the main reason that the anchor of the vessel did not hold the ground as expected?

Yes sir, that is my opinion.lxxiii[73]

Further, on redirect examination, Capt. Kabankov fortified his apathetic assessment of the situation:

Q
Now, after the anchor was dropped, was there any point in time that you felt that the vessel was
in imminent danger.
A

No, at that time, the vessel was not in imminent danger, sir."lxxiv[74]

This cavalier appraisal of the event by Capt. Kabankov is disturbingly antipodal to Capt. Gavino's
anxious assessment of the situation:
Q
When a pilot is on board a vessel, it is the pilot's command which should be followed-at that
moment until the vessel is, or goes to port or reaches port?
A
pilot.

Yes, your Honor, but it does not take away from the Captain his prerogative to countermand the

In what way?

A
In any case, which he thinks the pilot is not maneuvering correctly, the Captain always has the
prerogative to countermand the pilot's order.
Q
But insofar as competence, efficiency and functional knowledge of the seabed which are vital or
decisive in the safety (sic) bringing of a vessel to the port, he is not competent?
A
Yes, your Honor. That is why they hire a pilot in an advisory capacity, but still, the safety of the
vessel rest(s) upon the Captain, the Master of the vessel.
Q
In this case, there was not a disagreement between you and the Captain of the vessel in the
bringing of the vessel to port?
A

No, your Honor.

Court:
May proceed.
Atty. Catris:
In fact, the Master of the vessel testified here that he was all along in conformity with the orders you gave
to him, and, as matter of fact, as he said, he obeyed all your orders. Can you tell, if in the course of
giving such normal orders for the saf(e) docking of the MV Pavlodar, do you remember of any instance
that the Master of the vessel did not obey your command for the safety docking of the MV Pavlodar?
Atty. del Rosario:
Already answered, he already said yes sir.
Court:
Yes, he has just answered yes sir to the Court that there was no disagreement insofar as the bringing of
the vessel safely to the port.
Atty. Catris:
But in this instance of docking of the MV Pavlodar, do you remember of a time during the course of the
docking that the MV Pavlodar was in imminent danger of bumping the pier?
A
When we were about more than one thousand meters from the pier. I think, the anchor was not
holding, so I immediately ordered to push the bow at a fourth quarter, at the back of the vessel in order to
swing the bow away from the pier and at the same time, I ordered for a full astern of the engine."lxxv[75]
These conflicting reactions can only imply, at the very least, unmindful disregard or, worse, neglectful
relinquishment of duty by the shipmaster, tantamount to negligence.
The findings of the trial court on this aspect is noteworthy:
For, while the pilot Gavino may indeed have been charged with the task of docking the vessel in the
berthing space, it is undisputed that the master of the vessel had the corresponding duty to countermand
any of the orders made by the pilot, aid even maneuver the vessel himself, in case of imminent danger to
the vessel and the port.

In fact, in his testimony, Capt. Kavankov admitted that all throughout the man(eu)vering procedures
he did not notice anything was going wrong, and even observed that the order given to drop the anchor,
was done at the proper time. He even ventured the opinion that the accident occurred because the
anchor failed to take hold but that this did not alarm him because there was still time to drop a second
anchor.
Under normal circumstances, the above-mentioned facts would have caused the master of a vessel
to take charge of the situation and see to the man(eu)vering of the vessel himself. Instead, Capt.
Kavankov chose to rely blindly upon his pilot, who by this time was proven ill-equipped to cope with the
situation.
xxx

xxx

xxx

It is apparent that Gavino was negligent but Far Eastern's employee Capt. Kavankov was no less
responsible for as master of the vessel he stood by the pilot during the man(eu)vering procedures and
was privy to every move the latter made, as well as the vessel's response to each of the commands. His
choice to rely blindly upon the pilot's skills, to the point that despite being appraised of a notice of alert he
continued to relinquish control of the vessel to Gavino, shows indubitably that he was not performing his
duties with the diligence required of him and therefore may be charged with negligence along with
defendant Gavino.lxxvi[76]
As correctly affirmed by the Court of Appeals We are in full accord with the findings and disquisitions of the Court a quo.
In the present recourse, Captain Viktor Kavankov had been a mariner for thirty-two years before the
incident. When Gavino was (in) the command of the vessel, Kavankov was beside Gavino, relaying the
commands or orders of Gavino to the crewmembers-officers of the vessel concerned. He was thus fully
aware of the docking maneuvers and procedure Gavino undertook to dock the vessel. Irrefragably,
Kavankov was fully aware of the bulk and size of the vessel and its cargo as well as the weight of the
vessel. Kavankov categorically admitted that, when the anchor and two (2) shackles were dropped to the
sea floor, the claws of the anchor did not hitch on to any hard object in the seabed. The momentum of
the vessel was not arrested. The use of the two (2) tugboats was insufficient. The momentum of the
vessel, although a little bit arrested, continued (sic) the vessel going straightforward with its bow towards
the port (Exhibit "A-1"). There was thus a need for the vessel to move "full-astern" and to drop the other
anchor with another shackle or two '(2), for the vessel to avoid hitting the pier. Kavankov refused to act
even as Gavino failed to act. Even as Gavino gave mere "half-astern" order, Kavankov supinely stood by.
The vessel was already about twenty (20) meters away from the pier when Gavino gave the 'full-astern"
order. Even then, Kavankov did nothing to prevent the vessel from hitting the pier simply because he
relied on the competence and plan of Gavino. While the "full-astern" maneuver momentarily arrested the
momentum of the vessel, it was, by then, too late. All along, Kavankov stood supinely beside Gavino,
doing nothing but relay the commands of Gavino. Inscrutably, then, Kavankov was negligent.
xxx

xxx

xxx

The stark incompetence of Kavankov is competent evidence to prove the unseaworthiness of the vessel.
It has been held that the incompetence of the navigator, the master of the vessel or its crew makes the
vessel unseaworthy (Tug Ocean Prince versus United States of America, 584 F. 2nd, page 1151).
Hence, the Appellant FESC is likewise liable for the damage sustained by the Appellee."lxxvii[77]
We find strong and well-reasoned support in time-tested American maritime jurisprudence, on which
much of our laws and jurisprudence on the matter are based, for the conclusions of the Court of Appeals
adjudging both Capt. Gavino and Capt. Kabankov negligent.

As early as 1869, the U.S. Supreme Court declared, through Mr. Justice Swayne, in The Steamship
China vs. Walsh,lxxviii[78] that it is the duty of the master to interfere in cases of the pilot's intoxication or
manifest incapacity, in cases of danger which he does not foresee, and in all cases of great necessity.
The master has the same power to displace the pilot that he has to remove any subordinate officer of the
vessel, at his discretion.
In 1895, the U.S. Supreme Court, this time through Mr. Justice Brown, emphatically ruled that:
Nor are we satisfied with the conduct of the master in leaving the pilot in sole charge of the vessel.
While the pilot doubtless supersedes the master for the time being in the command and navigation of the
ship, and his orders must be obeyed in all matters connected with her navigation, the master is not wholly
absolved from his duties while the pilot is on board, and may advise with him, and even displace him in
case he is intoxicated or manifestly incompetent. He is still in command of the vessel, except so far as
her navigation is concerned, and bound to see that there is a sufficient watch on deck, and that the men
are attentive to their duties.
xxx (N)otwithstanding the pilot has charge, it is the duty of the master to prevent accident, and not to
abandon the vessel entirely to the pilot; but that there are certain duties he has to discharge
(notwithstanding there is a pilot on board) for the benefit of the owners. x x x that in well conducted ships
the master does not regard the presence of a duly licensed pilot in compulsory pilot waters as freeing him
from every obligation to attend to the safety of the vessel; but that, while the master sees that his officers
and crew duly attend to the pilot's orders, he himself is bound to keep a vigilant eye on the navigation of
the vessel, and, when exceptional circumstances exist, not only to urge upon the pilot to use every
precaution, but to insist upon, such being taken."lxxix[79] (Italics for emphasis.)
In Jure vs. United Fruit Co.,lxxx[80] which, like the present petitions, involved compulsory pilotage,
with a similar scenario where at and prior to the time of injury, the vessel was in the charge of a pilot with
the master on the bridge of the vessel beside said pilot, the court therein ruled:
The authority of the master of a vessel is not in complete abeyance while a pilot, who is required by
law to be accepted, is in discharge of his functions. x x x It is the duty of the master to interfere in cases of
the pilot's intoxication or manifest incapacity, in cases of danger which he does not foresee, and in all
cases of great necessity . The master has the same power to displace the pilot that he has to remove any
subordinate officer of the vessel. He may exercise it, or not, according to his discretion. There was
evidence to support findings that plaintiff's injury was due to the negligent operation of the Atenas, and
that the master of that vessel was negligent in failing to take action to avoid endangering a vessel situated
as the City of Canton was and persons or property thereon.
A phase of the evidence furnished support for the inferences x x x that he negligently failed to
suggest to the pilot the danger which was disclosed, and means of avoiding such danger; and that the
master's negligence in failing to give timely admonition to the pilot proximately contributed to the injury
complained of. We are of opinion that the evidence mentioned tended to prove conduct of the pilot,
known to the master, giving rise to a case of danger or great necessity, calling for the intervention of the
master. A master of a vessel is not Without fault in acquiescing in conduct of a pilot which involves
apparent and avoidable danger, whether such danger is to the vessel upon which the pilot is, or to
another vessel, or persons or property thereon or on shore. (Italics ours.)
Still in another case involving a nearly identical setting, the captain of a vessel alongside the compulsory
pilot was deemed to be negligent, since, in the words of the court, "he was in a position to exercise his
superior authority if he had deemed the speed excessive on the occasion in question. I think it was
clearly negligent of him not to have recognized the danger to any craft moored at Gravell Dock and that
he should have directed the pilot to reduce his speed as required by the local governmental regulations.
His failure amounted to negligence and renders the respondent liable."lxxxi[81] (Italics supplied.) Though

a compulsory pilot might be regarded as an independent contractor, he is at all times subject to the
ultimate control of the ship's master.lxxxii[82]
In sum, where a compulsory pilot is in charge of a ship, the master being required to permit him to
navigate it, if the master observes that the pilot is incompetent or physically incapable, then it is the duty
of the master to refuse to permit the pilot to act. But if no such reasons are present, then the master is
justified in relying upon the pilot, but not blindly. Under the circumstances of this case, if a situation arose
where the master, exercising that reasonable vigilance which the master of a ship should exercise,
observed, or should have observed, that the pilot was so navigating the vessel that she was going, or was
likely to go, into danger, and there was in the exercise of reasonable care and vigilance an opportunity for
the master to intervene so as to save the ship from danger, the master should have acted
accordingly.lxxxiii[83] The master of a vessel must exercise a degree of vigilance commensurate with the
circumstances.lxxxiv[84]
Inasmuch as the matter of negligence is a question of fact,lxxxv[85] we defer to the findings of the
trial court, especially as this is affirmed by the Court of Appeals.lxxxvi[86] But even beyond that, our own
evaluation is that Capt. Kabankov's shared liability is due mainly to the fact that he failed to act when the
perilous situation should have spurred him into quick and decisive action as master of the ship. In the
face of imminent or actual danger, he did not have to wait for the happenstance to occur before
countermanding or overruling the pilot. By his own admission, Capt. Kabankov concurred with Capt.
Gavino's decisions, and this is precisely the reason why he decided not to countermand any of the latter's
orders. Inasmuch as both lower courts found Capt. Gavino negligent, by expressing full agreement
therewith Capt. Kabankov was just as negligent as Capt. Gavino.
In general, a pilot is personally liable for damages caused by his own negligence or default to the
owners of the vessel, and to third parties for damages sustained in a collision. Such negligence of the
pilot in the performance of duty constitutes a maritime tort.lxxxvii[87] At common law, a shipowner is not
liable for injuries inflicted exclusively by the negligence of a pilot accepted by a vessel
compulsorily.lxxxviii[88] The exemption from liability for such negligence shall apply if the pilot is actually
in charge and solely in fault. Since, a pilot is responsible only for his own personal negligence, he cannot
be held accountable for damages proximately caused by the default of others,lxxxix[89] or, if there be
anything which concurred with the fault of the pilot in producing the accident, the vessel master and
owners are liable.
Since the colliding vessel is prima facie responsible, the burden of proof is upon the party claiming
benefit of the exemption from liability. It must be shown affirmatively that the pilot was at fault, and that
there was no fault on the part of the officers or crew, which might have been conducive to the damage.
The fact that the law compelled the master to take the pilot does not exonerate the vessel from liability.
The parties who suffer are entitled to have their remedy against the vessel that occasioned the damage,
and are not under necessity to look to the pilot from whom redress is not always had for compensation.
The owners of the vessel are responsible to the injured party for the acts of the pilot, and they must be left
to recover the amount as well as they can against him. It cannot be maintained that the circumstance of
having a pilot on board, and acting in conformity to his directions operate as a discharge of responsibility
of the owners.xc[90] Except insofar as their liability is limited or exempted by statute, the vessel or her
owner are liable for all damages caused by the negligence or other wrongs of the owners or those in
charge of the vessel. Where the pilot of a vessel is not a compulsory one in the sense that the owner or
master of the vessel are bound to accept him, but is employed voluntarily, the owners of the vessel are,
all the more, liable for his negligent act.xci[91]
In the United States, the owners of a vessel are not personally liable for the negligent acts of a
compulsory pilot, but by admiralty law, the fault or negligence of a compulsory pilot is imputable to the
vessel and it may be held liable therefor in rem. Where, however, by the provisions of the statute the pilot
is compulsory only in the sense that his fee must be paid, and is not in compulsory charge of the vessel,
there is no exemption from liability. Even though the pilot is compulsory, if his negligence was not the
sole cause of the injury, but the negligence of the master or crew contributed thereto, the owners are

liable.xcii[92] But the liability of the ship in rem does not release the pilot from the consequences of his
own negligence.xciii[93] The rationale for this rule is that the master is not entirely absolved of
responsibility with respect to navigation when a compulsory pilot is in charge.xciv[94]
By way of validation and in light of the aforecited guidepost rulings in American maritime cases, we
declare that our rulings during the early years of this century in City of Manila vs. Gambe, xcv[95] China
Navigation Co., Ltd. vs. Vidal,xcvi[96] and Yap Tico & Co. vs. Anderson, et al.xcvii[97] have withstood
the proverbial test of time and remain good and relevant case law to this day.
City of Manila stands for the doctrine that the pilot who was in command and complete control of a
vessel, and not the owners, must be held responsible for an accident which was solely the result of the
mistake of the pilot in not giving proper orders, and which did not result from the failure of the owners to
equip the vessel with the most modern and improved machinery. In China Navigation Co., the pilot
deviated from the ordinary and safe course, without heeding the warnings of the ship captain. It was this
careless deviation that caused the vessel to collide with a pinnacle rock which, though uncharted, was
known to pilots and local navigators. Obviously, the captain was blameless. It was the negligence of the
pilot alone which was the proximate cause of the collision. The Court could not but then rule that The pilot in the case at bar having deviated from the usual and ordinary course followed by
navigators in passing through the strait in question, without a substantial reason, was guilty of negligence,
and that negligence having been the proximate cause of the damages, he is liable for such damages as
usually and naturally flow therefrom. x x x.
x x x (T)he defendant should have known of the existence and location of the rock upon which the
vessel struck while under his control and management. x x x.
Consistent with the pronouncements in these two earlier cases, but on a slightly different tack, the
Court in Yap Tico & Co. exonerated the pilot from liability for the accident where the order's of the pilot in
the handling of the ship were disregarded by the officers and crew of the ship. According to the Court, a
pilot is "x x x responsible for a full knowledge of the channel and the navigation only so far as he can
accomplish it through the officers and crew of the ship, and I don't see that he can be held responsible for
damage when the evidence shows, as it does in this case, that the officers and crew of the ship failed to
obey his orders." Nonetheless, it is possible for a compulsory pilot and the master of the vessel to be
concurrently negligent and thus share the blame for the resulting damage as Joint tortfeasors,xcviii[98]
but only under the circumstances obtaining in and demonstrated by the instant petitions.
It may be said, as a general rule, that negligence in order to render a person liable need not be the
sole cause of an injury. It is sufficient that his negligence, concurring with one or more efficient causes
other than plaintiff's, is the proximate cause of the injury. Accordingly, where several causes combine to
produce injuries, a person is not relieved from liability because he is responsible for only one of them, it
being sufficient that the negligence of the person charged with injury is an efficient cause without which
the injury would not have resulted to as great an extent, and that such cause is not attributable to the
person injured. It is no defense to one of the concurrent tortfeasors that the injury would not have
resulted from his negligence alone, without the negligence or wrongful acts of the other concurrent
tortfeasor.xcix[99] Where several causes producing an injury are concurrent and each is an efficient
cause without which the injury would not have happened, the injury may be attributed to all or any of the
causes and recovery may be had against any or all of the responsible persons although under the
circumstances of the case, it may appear that one of them was more culpable, and that the duty owed by
them to the injured person was not the same. No actor's negligence ceases to be a proximate cause
merely because it does not exceed the negligence of other actors. Each wrongdoer is responsible for the
entire result and is liable as though his acts were the sole cause of the injury.c[100]
There is no contribution between joint tortfeasors whose liability is solidary since both of them are
liable for the total damage. Where the concurrent or successive negligent acts or omissions of two or

more persons, although acting independently, are in combination the direct and proximate cause of a
single injury to a third person, it is impossible to determine in what proportion each contributed to the
injury and either of them is responsible for the whole injury. Where their concurring negligence resulted in
injury or damage to a third party, they become joint tortfeasors and are solidarity liable for the resulting
damage under Article 2194ci[101] of the Civil Code.cii[102]
As for the amount of damages awarded by the trial court, we find the same to be reasonable. The
testimony of Mr. Pascual Barral, witness for PPA, on cross and redirect examination, appears to be
grounded on practical considerations:
Q
So that the cost of the two additional piles as well as the (two) square meters is already included
in this -P1,300,999.77.
A

Yes sir, everything. It is (the) final cost already.

For the eight piles.

Including the reduced areas and other reductions.

(A)nd the two square meters.

Yes sir.

Q
In other words, this P1,300,999.77 does not represent only for the six piles that was damaged as
well as the corresponding two piles.
A
The area was corresponding, was increased by almost two in the actual payment. That was why
the contract was decreased, the real amount was P1,124,627.40 and the final one is P1300,999.77.
Q

Yes, but that P1,300,999.77 included the additional two new posts.

It was increased.

Why was it increased?

The original was 48 and the actual was 46.

Q
Now, the damage was somewhere in 1980. It took place in 1980 and you started the repair and
reconstruction in 1982, that took almost two years?
A

Yes sir.

Q
May it not happen that by natural factors, the existing damage in 1980 was aggravated for the 2
year period that the damage portion was not repaired?
A

I don't think so because that area was at once marked and no vehicles can park, it was closed.

Even if or even natural elements cannot affect the damage?

Cannot, sir.

xxx

xxx

xxx

Q
You said in the cross-examination that there were six piles damaged by the accident, but that in
the reconstruction of the pier, PPA drove and constructed 8 piles. Will you explain to us why there was
change in the number of piles from the original number?
A
In piers where the piles are withdrawn or pulled out, you cannot re-drive or drive piles at the same
point. You have to redesign the driving of the piles. We cannot drive the piles at the same point where
the piles are broken or damaged or pulled out. We have to redesign, and you will note that in the
reconstruction, we redesigned such that it necessitated 8 piles.
Q

Why not, why could you not drive the same number of piles and on the same spot?

A
The original location was already disturbed. We cannot get required bearing capacity.
area is already disturbed.

The

Q
Nonetheless, if you drove the original number of piles, six, on different places, would not that
have sustained the same load?
A

It will not suffice, sir."ciii[103]

We quote the findings of the lower court with approval:

With regards to the amount of damages that is to be awarded to plaintiff, the Court finds that the amount
of P1,053,300.00 is justified. Firstly, the doctrine of res ipsa loquitur best expounded upon in the landmark
case of Republic vs. Luzon Stevedoring Corp. (21 SCRA 279) establishes the presumption that in the
ordinary course of events the ramming of the dock would not have occurred if proper care was used.
Secondly, the various estimates and plans justify the cost of the port construction price. The new
structure constructed not only replaced the damaged one but was built of stronger materials to forestall
the possibility of any similar accidents in the future.
The Court inevitably finds that the plaintiff is entitled to an award of P1,053,300.00 which represents
actual damages caused by the damage to Berth 4 of the Manila International Port. Co-defendants Far
Eastern Shipping, Capt. Senen Gavino and Manila Pilots Association are solidarity liable to pay this
amount to plaintiff.civ[104]
The Solicitor General rightly commented that the adjudicated amount of damages represents the
proportional cost of repair and rehabilitation of the damaged section of the pier.cv[105]
Except insofar as their liability is limited or exempted by statute, the vessel or her owners are liable for all
damages caused by the negligence or other wrongs of the owners or those in charge of the vessel. As a
general rule, the owners or those in possession and control of a vessel and the vessel are liable for all
natural and proximate damages caused to persons or property by reason of her negligent management or
navigation.cvi[106]
FESC's imputation of PPA's failure to provide a safe and reliable berthing place is obtuse, not only
because it appears to be a mere afterthought, being tardily raised only in this petition, but also because
there is no allegation or evidence on record about Berth No. 4 being unsafe and unreliable, although
perhaps it is a modest pier by international standards. There was, therefore, no error on the part of the
Court of Appeals in dismissing FESC's counterclaim.
II. G.R. No. 130150

This consolidated case treats on whether the Court of Appeals erred in holding MPA jointly and solidarity
liable with its member pilot, Capt. Gavino, in the absence of employer-employee relationship and in
applying Customs Administrative Order No. 15-65, as basis for the adjudged solidary liability of MPA and
Capt. Gavino.
The pertinent provisions in Chapter I of Customs Administrative Order No. 15-65 are:
"PAR. XXVII.-- In all pilotage districts where pilotage is compulsory, there shall be created and
maintained by the pilots or pilots' association, in the manner hereinafter prescribed, a reserve fund equal
to P1,000.00 for each pilot thereof for the purpose of paying claims for damages to vessels or property
caused through acts or omissions of its members while rendered in compulsory pilotage service. In
Manila, the reserve fund shall be P2,000.00 for each pilot.
PAR. XXVIII.-- A pilots' association shall not be liable under these regulations for damage to any vessel,
or other property, resulting from acts of a member of an association in the actual performance of his duty
for a greater amount than seventy-five per centum (75%) of its prescribed reserve fund; it being
understood that if the association is held liable for an amount greater than the amount above-stated, the
excess shall be paid by the personal funds of the member concerned.
PAR. XXXI.-- If a payment is made from the reserve fund of an association on account of damages
caused by a member thereof, and he shall have been found at fault, such member shall reimburse the
association in the amount so paid as soon as practicable; and for this purpose, not less than twenty-five
per centum of his dividends shall be retained each month until the full amount has been returned to the
reserve fund.
PAR. XXXIV. - Nothing in these regulations shall relieve any pilots' association or members thereof,
individually or collectively, from civil responsibility for damages to life or property resulting from the acts of
members in the performance of their duties.
Correlatively, the relevant provisions of PPA Administrative Order No. 03-85, which timely amended this
applicable maritime regulation, state:
Article IV
SEC. 17. Pilots' Association -- The Pilots in a Pilotage District shall organize themselves into a Pilots'
Association or firm, the members of which shall promulgate their own By-Laws not in conflict with the
rules and regulations promulgated by the Authority. These By-Laws shall be submitted not later than one
(1) month after the organization of the Pilots' Association for approval by the General Manager of the
Authority. Subsequent amendments thereto shall likewise be submitted for approval.
SEC. 25. Indemnity Insurance and Reserve Fund-a)

Each Pilots' Association shall collectively insure its membership at the rate of
P50,000.00 each member to cover in whole or in part any liability arising from
any accident resulting in damage to vessel(s), port facilities and other properties
and/or injury to persons or death which any member may have caused in the
course of his performance of pilotage duties. x x x.

b)

The Pilotage Association shall likewise set up and maintain a reserve fund which
shall answer for any part of the liability referred to in the immediately preceding
paragraph which is left unsatisfied by the insurance proceeds, in the following
manner:

xxx

xxx

1)

Each pilot in the Association shall contribute from his own account an amount of
P4,000.00 (P6,000.00 in the Manila Pilotage District) to the reserve fund. This
fund shall not be considered part of the capital of the Association nor charged as
an expense thereof.

2)

Seventy-five percent (75%) of the reserve fund shall be set aside for use, in the
payment of damages referred to above incurred in the actual performance of
pilots' duties and the excess shall be paid from the personal funds of the member
concerned.

xxx
5)

If payment is made from the reserve fund of an Association on account of

damage caused by a member thereof who is found at fault, he shall reimburse
the Association in the amount so paid as soon as practicable; and for this
purpose, not less than twenty-five percentum (25%) of his dividend shall be
retained each month until the full amount has been returned to the reserve fund.
Thereafter, the pilot involved shall be entitled to his full dividend.

6)

When the reimbursement has been completed as prescribed in the preceding

paragraph, the ten percentum (10%) and the interest withheld from the shares
of the other pilots in accordance with paragraph (4) hereof shall be returned to
them.

c)

Liability of Pilots' Association -- Nothing in these regulations shall relieve any

Pilots' Association or members thereof, individually or collectively, from any civil,
administrative and/or criminal responsibility for damages to life or property
resulting from the individual acts of its members as well as those of the
Association's employees and crew in the performance of their duties.

The Court of Appeals, while affirming the trial court's finding of solidary liability on the part of FESC, MPA
and Capt. Gavino, correctly based MPA's liability not on the concept of employer-employee relationship
between Capt. Gavino and itself, but on the provisions of Customs Administrative Order No. 15-65:
The Appellant MPA avers that, contrary to the findings and disquisitions of the Court a quo, the Appellant
Gavino was not and has never been an employee of the MPA but was only a member thereof. The Court
a quo, it is noteworthy,, did not state the factual basis on which it anchored its finding that Gavino was the
employee of MPA. We are in accord with MPA's pose. Case law teaches Us that, for an employeremployee relationship to exist the confluence of the following elements must be established: (1) selection
and engagement of employees; (2) the payment of wages; (3) the power of dismissal; (4) the employer's
power to control the employees with respect to the means and method by which the work is to be
performed (Ruga versus NLRC, 181SCRA 266).
xxx

xxx

xxx

The liability of MPA for damages is not anchored on Article 2180 of the New Civil Code as erroneously
found and declared by the Court a quo but under the provisions of Customs Administrative Order No. 1565, supra, in tandem with the by-laws of the MPA."cvii[107]
There being no employer-employee relationship, clearly Article 2180cviii[108] of the Civil Code is
inapplicable since there is no vicarious liability of an employer to speak of. It is so stated in American law,
as follows:

The well-established rule is that pilot associations are immune to vicarious liability for the tort of their
members. They are not the employer of their members and exercise no control over them once they take
the helm of the vessel. They are also not partnerships because the members do not function as agents
for the association or for each other. Pilots' associations are also not liable for negligently assuring, the
competence of their members because as professional associations they made no guarantee of the
professional conduct of their members to the general public.cix[109]
Where under local statutes and regulations, pilot associations lack the necessary legal incidents of
responsibility, they have been held not liable for damages caused by the default of a member pilot.cx[110]
Whether or not the members of a pilots' association are in legal effect a copartnership depends wholly on
the powers and duties of the members in relation to one another under the provisions of the governing
statutes and regulations. The relation of a pilot to his association is not that of a servant to the master,
but of an associate assisting and participating in a common purpose. Ultimately, the rights and liabilities
between a pilots' association and an individual member depend largely upon the constitution, articles or
by-laws of the association, subject to appropriate government regulations.cxi[111]
No reliance can be placed by MPA on the cited American rulings as to immunity from liability of a pilots'
association in light of existing positive regulation under Philippine law. The Court of Appeals properly
applied the clear and unequivocal provisions of Customs Administrative Order No. 15-65. In doing so, it
was just being consistent with its finding of the non-existence of employer-employee relationship between
MPA and Capt. Gavino precludes the application of Article 2180 of the Civil Code.
True, Customs Administrative Order No. 15-65 does not categorically characterize or label MPA's liability
as solidary in nature. Nevertheless, a careful reading and proper analysis of the correlated provisions
lead to the conclusion that MPA is solidarity liable for the negligence of its member pilots, without
prejudice to subsequent reimbursement from the pilot at fault.
Article 1207 of the Civil Code provides that there is solidary liability only when the obligation expressly so
states, or when the law or the nature of the obligation requires solidarity. Plainly, Customs Administrative
Order No. 15-65, which as an implementing rule has the force and effect of law, can validly provide for
solidary liability. We note the Solicitor General's comment hereon, to wit:
x x x Customs Administrative Order No. 15-65 may be a mere rule and regulation issued by an
administrative agency pursuant to a delegated authority to fix "the details" in the execution or enforcement
of a policy set out in the law itself. Nonetheless, said administrative order, which adds to the procedural
or enforcing provisions of substantive law, is legally binding and receives the same statutory force upon
going into effect. In that sense, it has equal, not lower, statutory force and effect as a regular statute
passed by the legislature."cxii[112]
MPA's prayer for modification of the appellate court's decision under review by exculpating petitioner MPA
"from liability beyond seventy-five percent (75%) of Reserve Fund" is unnecessary because the liability of
MPA under Par. XXVIII of Customs Administrative Order No. 15-65 is in fact limited to seventy-five
percent (75%) of its prescribed reserve fund, any amount of liability beyond that being for the personal
account of the erring pilot and subject to reimbursement in case of a finding of fault by the member
concerned. This is clarified by the Solicitor General:
Moreover, contrary to petitioners pretensions, the provisions of Customs Administrative Order No. 15-65
do not limit the liability of petitioner as a pilots' association to an absurdly small amount of seventy-five per
centum (75%) of the member pilots' contribution of P2,000.00 to the reserve fund. The law speaks of the
entire reserve fund required to be maintained by the pilots' association to answer (for) whatever liability
arising from the tortious act of its members. And even if the association is held liable for an amount
greater than the reserve fund, the association may not resist the liability by claiming to be liable only up to
seventy-five per centum (75%) of the reserve fund because in such instance it has the right to be
reimbursed by the offending member pilot for the excess."cxiii[113]

WHEREFORE, in view of all of the foregoing, the consolidated petitions for review are DENIED and the
assailed decision of the Court of Appeals is AFFIRMED in toto.
Counsel for FESC, the law firm of Del Rosario and Del Rosario, specifically its associate, Atty. Herbert A.
Tria, is REPRIMANDED and WARNED that a repetition of the same or similar acts of heedless disregard
of its undertakings under the Rules shall be dealt with more severely.
The original members of the legal team of the Office of the Solicitor General assigned to this case,
namely, Assistant Solicitor General Roman G. Del Rosario and Solicitor Luis F. Simon, are
ADMONISHED and WARNED that a repetition of the same or similar acts of unduly delaying proceedings
due to delayed filing of required pleadings shall also be dealt with more stringently.
The Solicitor General is DIRECTED to look into the circumstances of this case and to adopt provident
measures to avoid a repetition of this incident and which would ensure prompt compliance with orders of
this Court regarding the timely filing of requisite pleadings, in the interest of just, speedy and orderly
administration of justice.
Let copies of this decision be spread upon the personal records of the lawyers named herein in the
Office of the Bar Confidant.
SO ORDERED.

* Remote
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-15674

October 17, 1921

CONSOLACION GABETO, in her own right and as guardian ad litem of her three children, plaintiffappellee,
vs.
AGATON ARANETA, defendant-appellant.
Jose E. Locsin for appellant.
Block, Johnston and Greenbaum for appellee.

STREET, J.:
This action was instituted in the Court of First Instance of Iloilo by Consolacion Gabeto, in her own right
as widow of Proceso Gayetano, and as guardian ad litem of the three children, Conchita Gayetano,
Rosita Gayetano, and Fermin Gayetano, for the purpose of recovering damages incurred by the plaintiff
as a result of the death of the said Proceso Gayetano, supposedly cause by the wrongful act of the
defendant Agaton Araneta. Upon hearing the evidence, his Honor, Judge L. M. Southworth, awarded
damages to the plaintiff in the amount of P3,000, from which judgment the defendant appealed.

It appears in evidence that on August 4, 1918. Basilio Ilano and Proceso Gayetano took a carromata near
Plaza Gay, in the City of Iloilo, with a view to going to a cockpit on Calle Ledesma in the same City. When
the driver of the carromata had turned his horse and started in the direction indicated, the defendant,
Agaton Araneta, stepped out into the street, and laying his hands on the reins, stopped the horse, at the
same time protesting to the driver that he himself had called this carromata first. The driver, one Julio
Pagnaya, replied to the effect that he had not heard or seen the call of Araneta, and that he had taken up
the two passengers then in the carromata as the first who had offered employment. At or about the same
time Pagnaya pulled on the reins of the bridle to free the horse from the control of Agaton Araneta, in
order that the vehicle might pass on. Owing, however, to the looseness of the bridle on the horse's head
or to the rottenness of the material of which it was made, the bit came out of the horse's mouth; and it
became necessary for the driver to get out, which he did, in order to find the bridle. The horse was then
pulled over to near the curb, by one or the other it makes no difference which and Pagnaya tried to
fix the bridle.
While he was thus engaged, the horse, being free from the control of the bit, became disturbed and
moved forward, in doing which he pulled one of the wheels of the carromata up on the sidewalk and
pushed Julio Pagnaya over. After going a few years further the side of the carromata struck a police
telephone box which was fixed to a post on the sidewalk, upon which the box came down with a crash
and frightened the horse to such an extent that he set out at full speed up the street.
Meanwhile one of the passengers, to wit. Basilio Ilano, had alighted while the carromata was as yet
alongside the sidewalk; but the other, Proceso Gayetano, had unfortunately retained his seat, and after
the runaway horse had proceeded up the street to a point in front of the Mission Hospital, the said
Gayetano jumped or fell from the rig, and in so doing received injuries from which he soon died.
As to the facts above stated the evidence cannot be said to be materially in conflict; but there is decided
conflict upon the point of the exact relation of the defendant Agaton Araneta, to the runaway. The
evidence for the plaintiff on this point consists chiefly of the testimony of Julio Pagnaya and of Basilio
Ilano. They both say that while yet in the middle of the street, the defendant jerked the bridle, which
caused the bit to come out of the horse's mouth, and Julio says that at that juncture the throat latch of the
bridle was broken. Be this as it may, we are of the opinion that the mere fact that the defendant interfered
with the carromata by stopping the horse in the manner stated would not make him liable for the death of
Proceso Gayetano; because it is admitted by Julio Pagnaya that he afterwards got out of the carromata
and went to the horse's head to fix the bridle. The evidence is furthermore convincing to the effect that,
after Julio Pagnaya alighted, the horse was conducted to the curb and that an appreciable interval of time
elapsed same witnesses say several minutes before the horse started on his career up the street.
1awph!l.net
It is therefore evident that the stopping of the rig by Agaton Araneta in the middle of the street was too
remote from the accident that presently ensued to be considered the legal or proximate cause thereof.
Moreover, by getting out and taking his post at the head of the horse, the driver was the person primarily
responsible for the control of the animal, and the defendant cannot be charged with liability for the
accident resulting from the action of the horse thereafter.
Julio Pagnaya testifies to one fact which, if it were fully accredited, would possibly put a different
complexion on the case; for he says that when the horse was pulled over to the curb, the defendant, by
way of emphasizing his verbal denunciation of Pagnaya, gesticulated with one of his arms and
incidentally brought his hand down on the horse's nose. This, according to Pagnaya, is what made the
horse run away. There is no other witness who testifies to this; and it is noteworthy that Basilio Ilano does
not mention it. A decided preponderance of the evidence in our opinion is against it.
The evidence indicates that the bridle was old, and the leather of which it was made was probably so
weak as to be easily broken. Julio Pagnaya had a natural interest in refuting this fact, as well as in
exculpating himself in other respects; and we are of the opinion that the several witnesses who testified
for the defendant gave a more credible account of the affair than the witnesses for the plaintiff. According

to the witnesses for the defendant, it was Julio who jerked the rein, thereby causing the bit it come out of
the horse's mouth; and they say that Julio, after alighting, led the horse over to the curb, and proceeded
to fix the bridle; and that in so doing the bridle was slipped entirely off, when the horse, feeling himself
free from control, started to go away as previously stated.
Upon the whole we are constrained to hold that the defendant is not legally responsible for the death of
Proceso Gayetano; and though reluctant to interfere with the findings of fact of a trial court when there is
a conflict of testimony, the evidence in this case so clearly preponderates in favor of the defendant, that
we have no recourse but to reverse the judgment.
The judgment will therefore be reversed, and the defendant will be absolved from the complaint; and it is
so ordered, without express finding as to costs of either instance. So ordered.
Johnson, Araullo, Avancea and Villamor, JJ., concur.

EN BANC
[G.R. No. L-8328. May 18, 1956.]
MANILA ELECTRIC COMPANY, Petitioner, vs. SOTERO REMOQUILLO, in his own behalf and as
guardian of the minors MANUEL, BENJAMIN, NESTOR, MILAGROS, CORAZON, CLEMENTE and
AURORA, all surnamed MAGNO, SALUD MAGNO, and the COURT OF APPEALS (Second
Division), Respondents.

DECISION
MONTEMAYOR, J.:
On August 22, 1950, Efren Magno went to the 3-story house of Antonio Pealoza, his stepbrother,
located on Rodriguez Lanuza Street, Manila, to repair a media agua said to be in a leaking condition.
The media agua was just below the window of the third story. Standing on said media agua, Magno
received from his son thru that window a 3 X 6 galvanized iron sheet to cover the leaking portion, turned
around and in doing so the lower end of the iron sheet came into contact with the electric wire of the
Manila Electric Company (later referred to as the Company) strung parallel to the edge of the media
agua and 2 1/2 feet from it, causing his death by electrocution. His widow and children fled suit to
recover damages from the company. After hearing, the trial court rendered judgment in their favor
P10,000 as compensatory damages; chan roblesvirtualawlibraryP784 as actual damages; chan
roblesvirtualawlibraryP2,000 as moral and exemplary damages; chan roblesvirtualawlibraryand P3,000 as
attorneys fees, with costs. On appeal to the Court of Appeals, the latter affirmed the judgment with slight
modification by reducing the attorneys fees from P3,000 to P1,000 with costs. The electric company has
appealed said decision to us.
The findings of fact made by the Court of Appeals which are conclusive are stated in the following
portions of its decision which we reproduce below:chanroblesvirtuallawlibrary
The electric wire in question was an exposed, uninsulated primary wire stretched between poles on the
street and carrying a charge of 3,600 volts. It was installed there some two years before Pealozas
house was constructed. The record shows that during the construction of said house a similar incident
took place, although fortunate]y with much less tragic consequences. A piece of wood which a carpenter
was holding happened to come in contact with the same wire, producing some sparks. The owner of the
house forthwith complained to Defendant about the danger which the wire presented, and as a result
Defendant moved one end of the wire farther from the house by means of a brace, but left the other end
where it was.

At any rate, as revealed by the ocular inspection of the premises ordered by the trial court, the distance
from the electric wire to the edge of the media agua on which the deceased was making repairs was
only 30 inches or 2 1/2 feet. Regulations of the City of Manila required that all wires be kept three feet
from the building. Appellant contends that in applying said regulations to the case at bar the reckoning
should not be from the edge of the media agua but from the side of the house and that, thus measured,
the distance was almost 7 feet, or more then the minimum prescribed. This contention is manifestly
groundless, for not only is a media agua an integral part of the building to which it is attached but to
exclude it in measuring the distance would defeat the purpose of the regulation. Appellant points out,
nevertheless, that even assuming that the distance, within the meaning of the city regulations, should be
measured from the edge of the media agua, the fact that in the case of the house involved herein such
distance was actually less than 3 feet was due to the fault of the owner of said house, because the city
authorities gave him a permit to construct a media agua only one meter or 39 1/2 inches wide, but
instead he built one having a width of 65 3/4 inches, 17 3/8 inches more than the width permitted by the
authorities, thereby reducing the distance to the electric wire to less than the prescribed minimum of 3
feet.
It is a fact that the owner of the house exceeded the limit fixed in the permit given to him by the city
authorities for the construction of the media agua, and that if he had not done so Appellants wire would
have been 11 3/8 (inches) more than the required distance of three feet from the edge of the media
agua. It is also a fact, however, that after the media agua was constructed the owner was given a final
permit of occupancy of the house cralaw .
cralaw The wire was an exposed, high tension wire carrying a load of 3,600 volts. There was, according
to Appellant, no insulation that could have rendered it safe, first, because there is no insulation material in
commercial use for such kind of wire; chan roblesvirtualawlibraryand secondly, because the only
insulation material that may be effective is still in the experimental stage of development and, anyway, its
costs would be prohibitive
The theory followed by the appellate court in finding for the Plaintiff is that although the owner of the
house in constructing the media agua in question exceeded the limits fixed in the permit, still, after
making that media agua, its construction though illegal, was finally approved because he was given a
final permit to occupy the house; chan roblesvirtualawlibrarythat it was the company that was at fault and
was guilty of negligence because although the electric wire in question had been installed long before the
construction of the house and in accordance with the ordinance fixing a minimum of 3 feet, mere
compliance with the regulations does not satisfy the requirement of due diligence nor avoid the need for
adopting such other precautionary measures as may be warranted; chan roblesvirtualawlibrarythat
negligence cannot be determined by a simple matter of inches; chan roblesvirtualawlibrarythat all that the
city did was to prescribe certain minimum conditions and that just because the ordinance required that
primary electric wires should be not less than 3 feet from any house, the obligation of due diligence is not
fulfilled by placing such wires at a distance of 3 feet and one inch, regardless of other factors. The
appellate court, however, refrained from stating or suggesting what other precautionary measures could
and should have been adopted.
After a careful study and discussion of the case and the circumstances surrounding the same, we are
inclined to agree to the contention of Petitioner Company that the death of Magno was primarily caused
by his own negligence and in some measure by the too close proximity of the media agua or rather its
edge to the electric wire of the company by reason of the violation of the original permit given by the city
and the subsequent approval of said illegal construction of the media agua. We fail to see how the
Company could be held guilty of negligence or as lacking in due diligence. Although the city ordinance
called for a distance of 3 feet of its wires from any building, there was actually a distance of 7 feet and 2
3/4 inches of the wires from the side of the house of Pealoza. Even considering said regulation distance
of 3 feet as referring not to the side of a building, but to any projecting part thereof, such as a media
agua, had the house owner followed the terms of the permit given him by the city for the construction of
his media agua, namely, one meter or 39 3/8 inches wide, the distance from the wires to the edge of
said media agua would have been 3 feet and 11 3/8 inches. In fixing said one meter width for the media
agua the city authorities must have wanted to preserve the distance of at least 3 feet between the wires
and any portion of a building. Unfortunately, however, the house owner disregarding the permit, exceeded
the one meter fixed by the same by 17 3/8 inches and leaving only a distance of 2 1/2 feet between the

Media agua as illegally constructed and the electric wires. And added to this violation of the permit by
the house owner, was its approval by the city through its agent, possibly an inspector. Surely we cannot
lay these serious violations of a city ordinance and permit at the door of the Company, guiltless of breach
of any ordinance or regulation. The Company cannot be expected to be always on the lookout for any
illegal construction which reduces the distance between its wires and said construction, and after finding
that said distance of 3 feet had been reduced, to change the stringing or installation of its wires so as to
preserve said distance. It would be much easier for the City, or rather it is its duty, to be ever on the alert
and to see to it that its ordinances are strictly followed by house owners and to condemn or disapprove all
illegal constructions. Of course, in the present case, the violation of the permit for the construction of the
media agua was not the direct cause of the accident. It merely contributed to it. Had said media agua
been only one meter wide as allowed by the permit, Magno standing on it, would instinctively have stayed
closer to or hugged the side of the house in order to keep a safe margin between the edge of the media
agua and the yawning 2-story distance or height from the ground, and possibly if not probably avoided
the fatal contact between the lower end of the iron sheet and the wires.
We realize that the presence of the wires in question quite close to the house or its media agua was
always a source of danger considering their high voltage and uninsulated as they were, but the claim of
the company and the reasons given by it for not insulating said wires were unrefuted as we gather from
the findings of the Court of Appeals, and so we have to accept them as satisfactory. Consequently, we
may not hold said company as guilty of negligence or wanting in due diligence in failing to insulate said
wires. As to their proximity to the house it is to be supposed that distance of 3 feet was considered
sufficiently safe by the technical men of the city such as its electrician or engineer. Of course, a greater
distance of say 6 feet or 12 feet would have increased the margin of safety but other factors had to be
considered such as that the wires could not be strung or the posts supporting them could not be located
too far toward the middle of the street. Thus, the real cause of the accident or death was the reckless or
negligent act of Magno himself. When he was called by his stepbrother to repair the media agua just
below the third story window, it is to be presumed that due to his age and experience he was qualified to
do so. Perhaps he was a tinsmith or carpenter and had training and experience for the job. So, he could
not have been entirely a stranger to electric wires and the danger lurking in them. But unfortunately, in the
instant care, his training and experience failed him, and forgetting where he was standing, holding the 6feet iron sheet with both hands and at arms length, evidently without looking, and throwing all prudence
and discretion to the winds, he turned around swinging his arms with the motion of his body, thereby
causing his own electrocution.
In support of its theory and holding that Defendant-Appellant was liable for damages the Court of Appeals
cites the case of Astudillo vs. Manila Electric Co., 55 Phil., 427. We do not think the case is exactly
applicable. There, the premises involved was that elevated portion or top of the walls of Intramuros,
Manila, just above the Sta. Lucia Gate. In the words of the Court, it was a public place where persons
come to stroll, to rest and to enjoy themselves. The electric company was clearly negligent in placing its
wires so near the place that without much difficulty or exertion, a person by stretching his hand out could
touch them. A boy named Astudillo, placing one foot on a projection, reached out and actually grasped
the electric wire and was electrocuted. The person electrocuted in said case was a boy who was in no
position to realize the danger. In the present case, however, the wires were well high over the street
where there was no possible danger to pedestrians. The only possible danger was to persons standing
on the media agua, but a media agua can hardly be considered a public place where persons usually
gather. Moreover, a person standing on the media agua could not have reached the wires with his
hands alone. It was necessary as was done by Magno to hold something long enough to reach the wire.
Furthermore, Magno was not a boy or a person immature but the father of a family, supposedly a tinsmith
trained and experienced in the repair of galvanized iron roofs and media agua. Moreover, in that very
case of Astudillo vs. Manila Electric Co., supra, the court said that although it is a well- established rule
that the liability of electric companies for damages or personal injuries is governed by the rules of
negligence, nevertheless such companies are not insurers of the safety of the public.
But even assuming for a moment that under the facts of the present case the Defendant electric company
could be considered negligent in installing its electric wires so close to the house and media agua in
question, and in failing to properly insulate those wires (although according to the unrefuted claim of said
company it was impossible to make the insulation of that kind of wire), nevertheless to hold the Defendant

liable in damages for the death of Magno, such supposed negligence of the company must have been the
proximate and principal cause of the accident, because if the act of Magno in turning around and
swinging the galvanized iron sheet with his hands was the proximate and principal cause of the
electrocution, then his heirs may not recover. Such was the holding of this Court in the case of Taylor vs.
Manila Electric Railroad and Light Company, 16 Phil., 8. In that case, the electric company was found
negligent in leaving scattered on its premises fulminating caps which Taylor, a 15- year old boy found and
carried home. In the course of experimenting with said fulminating caps, he opened one of them, held it
out with his hands while another boy applied a lighted match to it, causing it to explode and injure one of
his eyes eventually causing blindness in said eye. Said this Tribunal in denying recovery for the
injury:chanroblesvirtuallawlibrary
cralaw, so that while it may be true that these injuries would not have been incurred but for the negligent
act of the Defendant in leaving the caps exposed on its premises, nevertheless Plaintiffs own act was the
proximate and principal cause of the accident which inflicted the injury.
To us it is clear that the principal and proximate cause of the electrocution was not the electric wire,
evidently a remote cause, but rather the reckless and negligent act of Magno in turning around and
swinging the galvanized iron sheet without taking any precaution, such as looking back toward the street
and at the wire to avoid its contacting said iron sheet, considering the latters length of 6 feet. For a better
understanding of the rule on remote and proximate cause with respect to injuries, we find the following
citation helpful:chanroblesvirtuallawlibrary
A prior and remote cause cannot be made the basis of an action if such remote cause did nothing more
than furnish the condition or give rise to the occasion by which the injury was made possible, if there
intervened between such prior or remote cause and the injury a distinct, successive, unrelated, and
efficient cause of the injury, even though such injury would not have happened but for such condition or
occasion. If no danger existed in the condition except because of the independent cause, such condition
was not the proximate cause. And if an independent negligent act or defective condition sets into
operation the circumstances which result in injury because of the prior defective condition, such
subsequent act or condition is the proximate cause. (45 C.J. pp. 931-332.).
We realize that the stringing of wires of such high voltage (3,600 volts), uninsulated and so close to
houses is a constant source of danger, even death, especially to persons who having occasion to be near
said wires, do not adopt the necessary precautions. But may be, the City of Manila authorities and the
electric company could get together and devise means of minimizing this danger to the public. Just as the
establishment of pedestrian lanes in city thoroughfares may greatly minimize danger to pedestrians
because drivers of motor vehicles may expect danger and slow down or even stop and take other
necessary precaution upon approaching said lanes, so, a similar way may possibly be found. Since these
high voltage wires cannot be properly insulated and at reasonable cost, they might perhaps be strung
only up to the outskirts of the city where there are few houses and few pedestrians and there step-down
to a voltage where the wires carrying the same to the city could be properly insulated for the better
protection of the public.
In view of all the foregoing, the appealed decision of the Court of Appeals is hereby reversed and the
complaint filed against the Company is hereby dismissed. No costs.
Paras, C.J., Bengzon, Padilla, Reyes, A., Jugo, Bautista Angelo, Labrador, Concepcion, Reyes,
J.B.L., and Endencia, JJ., concur.