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1. MetroBank vs.

Rosales

Respondent Rosales, however, denied taking part in the fraudulent and unauthorized withdrawal from
the dollar account of Liu Chiu Fang. Respondent Rosales claimed that she did not go to the bank on
February 5, 2003. Neither did she inform Gutierrez that Liu Chiu Fang was going to close her
account. Respondent Rosales further claimed that after Liu Chiu Fang opened an account with
petitioner, she lost track of her. Respondent Rosales version of the events that transpired thereafter
is as follows:
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G.R. No. 183204

January 13, 2014

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THE METROPOLITAN BANK AND TRUST COMPANY, Petitioner,


vs.
ANA GRACE ROSALES AND YO YUK TO, Respondents.

On February 6, 2003, she received a call from Gutierrez informing her that Liu Chiu Fang was at the
bank to close her account. At noon of the same day, respondent Rosales went to the bank to make a
transaction. While she was transacting with the teller, she caught a glimpse of a woman seated at the
desk of the Branch Operating Officer, Melinda Perez (Perez). After completing her transaction,
respondent Rosales approached Perez who informed her that Liu Chiu Fang had closed her account
and had already left. Perez then gave a copy of the Withdrawal Clearance issued by the PLRA to
respondent Rosales. On June 16, 2003, respondent Rosales received a call from Liu Chiu Fang
inquiring about the extension of her PLRA Visa and her dollar account. It was only then that Liu Chiu
Fang found out that her account had been closed without her knowledge. Respondent Rosales then
went to the bank to inform Gutierrez and Perez of the unauthorized withdrawal. On June 23, 2003,
respondent Rosales and Liu Chiu Fang went to the PLRA Office, where they were informed that the
Withdrawal Clearance was issued on the basis of a Special Power of Attorney (SPA) executed by Liu
Chiu Fang in favor of a certain Richard So. Liu Chiu Fang, however, denied executing the SPA. The
following day, respondent Rosales, Liu Chiu Fang, Gutierrez, and Perez met at the PLRA Office to
discuss the unauthorized withdrawal. During the conference, the bank officers assured Liu Chiu Fang
that the money would be returned to her.
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DECISION

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DEL CASTILLO, J.:

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Bank deposits, which are in the nature of a simple loan or mutuum, must be paid upon demand by the
depositor.
1

This Petition for Review on Certiorari under Rule 45 of the Rules of Court assails the April 2, 2008
Decision and the May 30, 2008 Resolution of he Court of Appeals CA) in CA-G.R. CV No. 89086.
3

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Factual Antecedents

42

Petitioner Metropolitan Bank and Trust Company is a domestic banking corporation duly organized and
existing under the laws of the Philippines. Respondent Ana Grace Rosales (Rosales) is the owner of
China Golden Bridge Travel Services, a travel agency. Respondent Yo Yuk To is the mother of
respondent Rosales.
6

On December 15, 2003, the Office of the City Prosecutor of Manila issued a Resolution dismissing the
criminal case for lack of probable cause. Unfazed, petitioner moved for reconsideration.
43

On September 10, 2004, respondents filed before the Regional Trial Court (RTC) of Manila a
Complaint for Breach of Obligation and Contract with Damages, docketed as Civil Case No.
04110895 and raffled to Branch 21, against petitioner. Respondents alleged that they attempted
several times to withdraw their deposits but were unable to because petitioner had placed their
accounts under "Hold Out" status. No explanation, however, was given by petitioner as to why it
issued the "Hold Out" order. Thus, they prayed that the "Hold Out" order be lifted and that they be
allowed to withdraw their deposits. They likewise prayed for actual, moral, and exemplary damages,
as well as attorneys fees.
44

In 2000, respondents opened a Joint Peso Account with petitioners Pritil-Tondo Branch. As of
August 4, 2004, respondents Joint Peso Account showed a balance of P2,515,693.52.
10

11

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45

In May 2002, respondent Rosales accompanied her client Liu Chiu Fang, a Taiwanese National
applying for a retirees visa from the Philippine Leisure and Retirement Authority (PLRA), to petitioners
branch in Escolta to open a savings account, as required by the PLRA. Since Liu Chiu Fang could
speak only in Mandarin, respondent Rosales acted as an interpreter for her.
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46

47

48

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Petitioner alleged that respondents have no cause of action because it has a valid reason for issuing
the "Hold Out" order. It averred that due to the fraudulent scheme of respondent Rosales, it was
compelled to reimburse Liu Chiu Fang the amount of US$75,000.00 and to file a criminal complaint for
Estafa against respondent Rosales.
49

On March 3, 2003, respondents opened with petitioners Pritil-Tondo Branch a Joint Dollar
Account with an initial deposit of US$14,000.00.
15

50

16

On July 31, 2003, petitioner issued a "Hold Out" order against respondents accounts.

51

17

While the case for breach of contract was being tried, the City Prosecutor of Manila issued a
Resolution dated February 18, 2005, reversing the dismissal of the criminal complaint. An Information,
docketed as Criminal Case No. 05-236103, was then filed charging respondent Rosales with Estafa
before Branch 14 of the RTC of Manila.
52

On September 3, 2003, petitioner, through its Special Audit Department Head Antonio Ivan Aguirre,
filed before the Office of the Prosecutor of Manila a criminal case for Estafa through False Pretences,
Misrepresentation, Deceit, and Use of Falsified Documents, docketed as I.S. No. 03I-25014, against
respondent Rosales. Petitioner accused respondent Rosales and an unidentified woman as the ones
responsible for the unauthorized and fraudulent withdrawal of US$75,000.00 from Liu Chiu Fangs
dollar account with petitioners Escolta Branch. Petitioner alleged that on February 5, 2003, its branch
in Escolta received from the PLRA a Withdrawal Clearance for the dollar account of Liu Chiu
Fang; that in the afternoon of the same day, respondent Rosales went to petitioners Escolta Branch
to inform its Branch Head, Celia A. Gutierrez (Gutierrez), that Liu Chiu Fang was going to withdraw her
dollar deposits in cash; that Gutierrez told respondent Rosales to come back the following day
because the bank did not have enough dollars; that on February 6, 2003, respondent Rosales
accompanied an unidentified impostor of Liu Chiu Fang to the bank; that the impostor was able to
withdraw Liu Chiu Fangs dollar deposit in the amount of US$75,000.00; that on March 3, 2003,
respondents opened a dollar account with petitioner; and that the bank later discovered that the serial
numbers of the dollar notes deposited by respondents in the amount of US$11,800.00 were the same
as those withdrawn by the impostor.

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Ruling of the Regional Trial Court

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21

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On January 15, 2007, the RTC rendered a Decision finding petitioner liable for damages for breach of
contract. The RTC ruled that it is the duty of petitioner to release the deposit to respondents as the act
of withdrawal of a bank deposit is an act of demand by the creditor. The RTC also said that the
recourse of petitioner is against its negligent employees and not against respondents. The dispositive
portion of the Decision reads:
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WHEREFORE, premises considered, judgment is hereby rendered ordering [petitioner]


METROPOLITAN BANK & TRUST COMPANY to allow [respondents] ANA GRACE ROSALES and
YO YUK TO to withdraw their Savings and Time Deposits with the agreed interest, actual damages

Lastly, petitioner puts in issue the award of moral and exemplary damages and attorneys fees. It
insists that respondents failed to prove that it acted in bad faith or in a wanton, fraudulent, oppressive
or malevolent manner.

of P50,000.00, moral damages of P50,000.00, exemplary damages of P30,000.00 and 10% of the
amount due [respondents] as and for attorneys fees plus the cost of suit.

70

The counterclaim of [petitioner] is hereby DISMISSED for lack of merit.


Respondents Arguments
SO ORDERED.

59

Respondents, on the other hand, argue that there is no legal basis for petitioner to withhold their
deposits because they have no monetary obligation to petitioner. They insist that petitioner miserably
failed to prove its accusations against respondent Rosales. In fact, no documentary evidence was
presented to show that respondent Rosales participated in the unauthorized withdrawal. They also
question the fact that the list of the serial numbers of the dollar notes fraudulently withdrawn on
February 6, 2003, was not signed or acknowledged by the alleged impostor. Respondents likewise
maintain that what was established during the trial was the negligence of petitioners employees as
they allowed the withdrawal of the funds without properly verifying the identity of the
depositor. Furthermore, respondents contend that their deposits are in the nature of a loan; thus,
petitioner had the obligation to return the deposits to them upon demand. Failing to do so makes
petitioner liable to pay respondents moral and exemplary damages, as well as attorneys fees.
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Ruling of the Court of Appeals

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Aggrieved, petitioner appealed to the CA.

74

On April 2, 2008, the CA affirmed the ruling of the RTC but deleted the award of actual damages
because "the basis for [respondents] claim for such damages is the professional fee that they paid to
their legal counsel for [respondent] Rosales defense against the criminal complaint of [petitioner] for
estafa before the Office of the City Prosecutor of Manila and not this case." Thus, the CA disposed of
the case in this wise:
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Our Ruling
WHEREFORE, premises considered, the Decision dated January 15, 2007 of the RTC, Branch 21,
Manila in Civil Case No. 04-110895 is AFFIRMED with MODIFICATION that the award of actual
damages to [respondents] Rosales and Yo Yuk To is hereby DELETED.
SO ORDERED.

The Petition is bereft of merit.

61

Petitioner sought reconsideration but the same was denied by the CA in its May 30, 2008 Resolution.

62

Issues

At the outset, the relevant issues in this case are (1) whether petitioner breached its contract with
respondents, and (2) if so, whether it is liable for damages. The issue of whether petitioners
employees were negligent in allowing the withdrawal of Liu Chiu Fangs dollar deposits has no bearing
in the resolution of this case. Thus, we find no need to discuss the same.
The "Hold Out" clause does not apply

Hence, this recourse by petitioner raising the following issues:

to the instant case.

A. THE [CA] ERRED IN RULING THAT THE "HOLD-OUT" PROVISION IN THE


APPLICATION AND AGREEMENT FOR DEPOSIT ACCOUNT DOES NOT APPLY IN THIS
CASE.

Petitioner claims that it did not breach its contract with respondents because it has a valid reason for
issuing the "Hold Out" order. Petitioner anchors its right to withhold respondents deposits on the
Application and Agreement for Deposit Account, which reads:

B. THE [CA] ERRED WHEN IT RULED THAT PETITIONERS EMPLOYEES WERE


NEGLIGENT IN RELEASING LIU CHIU FANGS FUNDS.

Authority to Withhold, Sell and/or Set Off:

C. THE [CA] ERRED IN AFFIRMING THE AWARD OF MORAL DAMAGES, EXEMPLARY


DAMAGES, AND ATTORNEYS FEES.
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Petitioners Arguments
Petitioner contends that the CA erred in not applying the "Hold Out" clause stipulated in the Application
and Agreement for Deposit Account. It posits that the said clause applies to any and all kinds of
obligation as it does not distinguish between obligations arising ex contractu or ex delictu. Petitioner
also contends that the fraud committed by respondent Rosales was clearly established by
evidence; thus, it was justified in issuing the "Hold-Out" order. Petitioner likewise denies that its
employees were negligent in releasing the dollars. It claims that it was the deception employed by
respondent Rosales that caused petitioners employees to release Liu Chiu Fangs funds to the
impostor.

The Bank is hereby authorized to withhold as security for any and all obligations with the Bank, all
monies, properties or securities of the Depositor now in or which may hereafter come into the
possession or under the control of the Bank, whether left with the Bank for safekeeping or otherwise, or
coming into the hands of the Bank in any way, for so much thereof as will be sufficient to pay any or all
obligations incurred by Depositor under the Account or by reason of any other transactions between
the same parties now existing or hereafter contracted, to sell in any public or private sale any of such
properties or securities of Depositor, and to apply the proceeds to the payment of any Depositors
obligations heretofore mentioned.

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xxxx

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JOINT ACCOUNT

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The Bank may, at any time in its discretion and with or without notice to all of the Depositors, assert a
lien on any balance of the Account and apply all or any part thereof against any indebtedness, matured
or unmatured, that may then be owing to the Bank by any or all of the Depositors. It is understood that
if said indebtedness is only owing from any of the Depositors, then this provision constitutes the
consent by all of the depositors to have the Account answer for the said indebtedness to the extent of
the equal share of the debtor in the amount credited to the Account.

In closing, it must be stressed that while we recognize that petitioner has the right to protect itself from
fraud or suspicions of fraud, the exercise of his right should be done within the bounds of the law and
in accordance with due process, and not in bad faith or in a wanton disregard of its contractual
obligation to respondents.

78

Petitioners reliance on the "Hold Out" clause in the Application and Agreement for Deposit Account is
misplaced.
The "Hold Out" clause applies only if there is a valid and existing obligation arising from any of the
sources of obligation enumerated in Article 1157 of the Civil Code, to wit: law, contracts, quasicontracts, delict, and quasi-delict. In this case, petitioner failed to show that respondents have an
obligation to it under any law, contract, quasi-contract, delict, or quasi-delict. And although a criminal
case was filed by petitioner against respondent Rosales, this is not enough reason for petitioner to
issue a "Hold Out" order as the case is still pending and no final judgment of conviction has been
rendered against respondent Rosales. In fact, it is significant to note that at the time petitioner issued
the "Hold Out" order, the criminal complaint had not yet been filed. Thus, considering that respondent
Rosales is not liable under any of the five sources of obligation, there was no legal basis for petitioner
to issue the "Hold Out" order. Accordingly, we agree with the findings of the RTC and the CA that the
"Hold Out" clause does not apply in the instant case.

WHEREFORE, the Petition is hereby DENIED. The assailed April 2, 2008 Decision and the May 30,
2008 Resolution of the Court of Appeals in CA-G.R. CV No. 89086 are hereby AFFIRMED. SO
ORDERED.

79

In view of the foregoing, we find that petitioner is guilty of breach of contract when it unjustifiably
refused to release respondents deposit despite demand. Having breached its contract with
respondents, petitioner is liable for damages.
Respondents are entitled to moral and
exemplary damages and attorneys fees.

2. PSBA vs. CA
G.R. No. 84698 February 4, 1992
PHILIPPINE SCHOOL OF BUSINESS ADMINISTRATION, JUAN D. LIM, BENJAMIN P. PAULINO,
ANTONIO M. MAGTALAS, COL. PEDRO SACRO and LT. M. SORIANO, petitioners,
vs.
COURT OF APPEALS, HON. REGINA ORDOEZ-BENITEZ, in her capacity as Presiding Judge of
Branch 47, Regional Trial Court, Manila, SEGUNDA R. BAUTISTA and ARSENIA D.
BAUTISTA, respondents.
Balgos and Perez for petitioners.
Collantes, Ramirez & Associates for private respondents.

1wphi1

In cases of breach of contract, moral damages may be recovered only if the defendant acted
fraudulently or in bad faith, or is "guilty of gross negligence amounting to bad faith, or in wanton
disregard of his contractual obligations."
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PADILLA, J.:

81

In this case, a review of the circumstances surrounding the issuance of the "Hold Out" order reveals
that petitioner issued the "Hold Out" order in bad faith. First of all, the order was issued without any
legal basis. Second, petitioner did not inform respondents of the reason for the "Hold Out." Third, the
order was issued prior to the filing of the criminal complaint. Records show that the "Hold Out" order
was issued on July 31, 2003, while the criminal complaint was filed only on September 3, 2003. All
these taken together lead us to conclude that petitioner acted in bad faith when it breached its contract
with respondents. As we see it then, respondents are entitled to moral damages.
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As to the award of exemplary damages, Article 2229 of the Civil Code provides that exemplary
damages may be imposed "by way of example or correction for the public good, in addition to the
moral, temperate, liquidated or compensatory damages." They are awarded only if the guilty party
acted in a wanton, fraudulent, reckless, oppressive or malevolent manner.
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In this case, we find that petitioner indeed acted in a wanton, fraudulent, reckless, oppressive or
malevolent manner when it refused to release the deposits of respondents without any legal basis. We
need not belabor the fact that the banking industry is impressed with public interest. As such, "the
highest degree of diligence is expected, and high standards of integrity and performance are even
required of it." It must therefore "treat the accounts of its depositors with meticulous care and always
to have in mind the fiduciary nature of its relationship with them." For failing to do this, an award of
exemplary damages is justified to set an example.

A stabbing incident on 30 August 1985 which caused the death of Carlitos Bautista while on the
second-floor premises of the Philippine School of Business Administration (PSBA) prompted the
parents of the deceased to file suit in the Regional Trial Court of Manila (Branch 47) presided over by
Judge (now Court of Appeals justice) Regina Ordoez-Benitez, for damages against the said PSBA
and its corporate officers. At the time of his death, Carlitos was enrolled in the third year commerce
course at the PSBA. It was established that his assailants were not members of the school's academic
community but were elements from outside the school.
Specifically, the suit impleaded the PSBA and the following school authorities: Juan D. Lim (President),
Benjamin P. Paulino (Vice-President), Antonio M. Magtalas (Treasurer/Cashier), Col. Pedro Sacro
(Chief of Security) and a Lt. M. Soriano (Assistant Chief of Security). Substantially, the plaintiffs (now
private respondents) sought to adjudge them liable for the victim's untimely demise due to their alleged
negligence, recklessness and lack of security precautions, means and methods before, during and
after the attack on the victim. During the proceedings a quo, Lt. M. Soriano terminated his relationship
with the other petitioners by resigning from his position in the school.

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The award of attorney's fees is likewise proper pursuant to paragraph 1, Article 2208 of the Civil
Code.
90

Defendants a quo (now petitioners) sought to have the suit dismissed, alleging that since they are
presumably sued under Article 2180 of the Civil Code, the complaint states no cause of action against
them, as jurisprudence on the subject is to the effect that academic institutions, such as the PSBA, are
beyond the ambit of the rule in the afore-stated article.
The respondent trial court, however, overruled petitioners' contention and thru an order dated 8
December 1987, denied their motion to dismiss. A subsequent motion for reconsideration was similarly
dealt with by an order dated 25 January 1988. Petitioners then assailed the trial court's disposition

before the respondent appellate court which, in a decision * promulgated on 10 June 1988, affirmed
the trial court's orders. On 22 August 1988, the respondent appellate court resolved to deny the
petitioners' motion for reconsideration. Hence, this petition.
At the outset, it is to be observed that the respondent appellate court primarily anchored its decision on
the law ofquasi-delicts, as enunciated in Articles 2176 and 2180 of the Civil Code. 1 Pertinent portions
of the appellate court's now assailed ruling state:
Article 2180 (formerly Article 1903) of the Civil Code is an adoption from the old
Spanish Civil Code. The comments of Manresa and learned authorities on its
meaning should give way to present day changes. The law is not fixed and
flexible (sic); it must be dynamic. In fact, the greatest value and significance of
law as a rule of conduct in (sic) its flexibility to adopt to changing social
conditions and its capacity to meet the new challenges of progress.
Construed in the light of modern day educational system, Article 2180 cannot be
construed in its narrow concept as held in the old case of Exconde
vs. Capuno 2 and Mercado vs. Court of Appeals; 3hence, the ruling in
the Palisoc 4 case that it should apply to all kinds of educational institutions,
academic or vocational.
At any rate, the law holds the teachers and heads of the school staff liable unless
they relieve themselves of such liability pursuant to the last paragraph of Article
2180 by "proving that they observed all the diligence to prevent damage." This
can only be done at a trial on the merits of the case. 5
While we agree with the respondent appellate court that the motion to dismiss the complaint was
correctly denied and the complaint should be tried on the merits, we do not however agree with the
premises of the appellate court's ruling.
Article 2180, in conjunction with Article 2176 of the Civil Code, establishes the rule of in loco parentis.
This Court discussed this doctrine in the afore-cited cases of Exconde, Mendoza, Palisoc and, more
recently, in Amadora vs.Court of Appeals. 6 In all such cases, it had been stressed that the law (Article
2180) plainly provides that the damage should have been caused or inflicted by pupils or students of
he educational institution sought to be held liable for the acts of its pupils or students while in its
custody. However, this material situation does not exist in the present case for, as earlier indicated, the
assailants of Carlitos were not students of the PSBA, for whose acts the school could be made liable.
However, does the appellate court's failure to consider such material facts mean the exculpation of the
petitioners from liability? It does not necessarily follow.
When an academic institution accepts students for enrollment, there is established a contract between
them, resulting in bilateral obligations which both parties are bound to comply with. 7 For its part, the
school undertakes to provide the student with an education that would presumably suffice to equip him
with the necessary tools and skills to pursue higher education or a profession. On the other hand, the
student covenants to abide by the school's academic requirements and observe its rules and
regulations.
Institutions of learning must also meet the implicit or "built-in" obligation of providing their students with
an atmosphere that promotes or assists in attaining its primary undertaking of imparting knowledge.
Certainly, no student can absorb the intricacies of physics or higher mathematics or explore the realm
of the arts and other sciences when bullets are flying or grenades exploding in the air or where there
looms around the school premises a constant threat to life and limb. Necessarily, the school must
ensure that adequate steps are taken to maintain peace and order within the campus premises and to
prevent the breakdown thereof.

Because the circumstances of the present case evince a contractual relation between the PSBA and
Carlitos Bautista, the rules on quasi-delict do not really govern. 8 A perusal of Article 2176 shows that
obligations arising from quasi-delicts or tort, also known as extra-contractual obligations, arise only
between parties not otherwise bound by contract, whether express or implied. However, this
impression has not prevented this Court from determining the existence of a tort even when there
obtains a contract. In Air France vs. Carrascoso (124 Phil. 722), the private respondent was awarded
damages for his unwarranted expulsion from a first-class seat aboard the petitioner airline. It is noted,
however, that the Court referred to the petitioner-airline's liability as one arising from tort, not one
arising from a contract of carriage. In effect, Air France is authority for the view that liability from tort
may exist even if there is a contract, for the act that breaks the contract may be also a tort. (AustroAmerica S.S. Co. vs. Thomas, 248 Fed. 231).
This view was not all that revolutionary, for even as early as 1918, this Court was already of a similar
mind. InCangco vs. Manila Railroad (38 Phil. 780), Mr. Justice Fisher elucidated thus:
The field of non-contractual obligation is much broader than that of contractual
obligation, comprising, as it does, the whole extent of juridical human relations.
These two fields, figuratively speaking, concentric; that is to say, the mere fact
that a person is bound to another by contract does not relieve him from extracontractual liability to such person. When such a contractual relation exists the
obligor may break the contract under such conditions that the same act which
constitutes a breach of the contract would have constituted the source of an
extra-contractual obligation had no contract existed between the parties.
Immediately what comes to mind is the chapter of the Civil Code on Human Relations, particularly
Article 21, which provides:
Any person who wilfully causes loss or injury to another in a manner that is
contrary to morals, good custom or public policy shall compensate the latter for
the damage. (emphasis supplied).
Air France penalized the racist policy of the airline which emboldened the petitioner's employee to
forcibly oust the private respondent to cater to the comfort of a white man who allegedly "had a better
right to the seat." InAustro-American, supra, the public embarrassment caused to the passenger was
the justification for the Circuit Court of Appeals, (Second Circuit), to award damages to the latter. From
the foregoing, it can be concluded that should the act which breaches a contract be done in bad faith
and be violative of Article 21, then there is a cause to view the act as constituting a quasi-delict.
In the circumstances obtaining in the case at bar, however, there is, as yet, no finding that the contract
between the school and Bautista had been breached thru the former's negligence in providing proper
security measures. This would be for the trial court to determine. And, even if there be a finding of
negligence, the same could give rise generally to a breach of contractual obligation only. Using the test
of Cangco, supra, the negligence of the school would not be relevant absent a contract. In fact, that
negligence becomes material only because of the contractual relation between PSBA and Bautista. In
other words, a contractual relation is a condition sine qua nonto the school's liability. The negligence of
the school cannot exist independently of the contract, unless the negligence occurs under the
circumstances set out in Article 21 of the Civil Code.
This Court is not unmindful of the attendant difficulties posed by the obligation of schools, abovementioned, for conceptually a school, like a common carrier, cannot be an insurer of its students
against all risks. This is specially true in the populous student communities of the so-called "university
belt" in Manila where there have been reported several incidents ranging from gang wars to other
forms of hooliganism. It would not be equitable to expect of schools to anticipate all types of violent
trespass upon their premises, for notwithstanding the security measures installed, the same may still
fail against an individual or group determined to carry out a nefarious deed inside school premises and
environs. Should this be the case, the school may still avoid liability by proving that the breach of its
contractual obligation to the students was not due to its negligence, here statutorily defined to be the

omission of that degree of diligence which is required by the nature of the obligation and corresponding
to the circumstances of persons, time and place. 9

Leonardo died during the pendency of the case and was substituted by his widow, Esperanza.
Meanwhile, Gruspe sold the wrecked car for P130,000.00.

As the proceedings a quo have yet to commence on the substance of the private respondents'
complaint, the record is bereft of all the material facts. Obviously, at this stage, only the trial court can
make such a determination from the evidence still to unfold.

In a decision dated September 27, 2004, the RTC ruled in favor of Gruspe and ordered Cruz and
Leonardo to pay P220,000.00,6 plus 15% per annum from November 15, 1999 until fully paid, and the
cost of suit.

WHEREFORE, the foregoing premises considered, the petition is DENIED. The court of origin (RTC,
Manila, Br. 47) is hereby ordered to continue proceedings consistent with this ruling of the Court. Costs
against the petitioners.

On appeal, the CA affirmed the RTC decision, but reduced the interest rate to 12% per annum
pursuant to the Joint Affidavit of Undertaking.7 It declared that despite its title, the Joint Affidavit of
Undertaking is a contract, as it has all the essential elements of consent, object certain, and
consideration required under Article 1318 of the Civil

SO ORDERED.
Code. The CA further said that Cruz and Leonardo failed to present evidence to support their
contention of vitiated consent. By signing the Joint Affidavit of Undertaking, they voluntarily assumed
the obligation for the damage they caused to Gruspes car; Leonardo, who was not a party to the
incident, could have refused to sign the affidavit, but he did not.

3. Cruz vs. Gruspe


G.R. No. 191431

March 13, 2013


THE PETITION

RODOLFO G. CRUZ and ESPERANZA IBIAS, Petitioners,


vs.
ATTY. DELFIN GRUSPE, Respondent.
DECISION
BRION, J.:
1

Before the Court is the petition for review on certiorari filed under Rule 45 of the Rules of Court,
assailing the decision2 dated July 30, 2009 and the resolution3 dated February 19, 2010 of the Court of
Appeals (CA) in CA-G.R. CV No. 86083. The CA rulings affirmed with modification the decision dated
September 27, 2004 of the Regional Trial Court (RTC) of Bacoor, Cavite, Branch 19, in Civil Case No.
BCV-99-146 which granted respondent Atty. Delfin Grupes claim for payment of sum of money against
petitioners Rodolfo G. Cruz and Esperanza Ibias.4
THE FACTUAL BACKGROUND
The claim arose from an accident that occurred on October 24, 1999, when the mini bus owned and
operated by Cruz and driven by one Arturo Davin collided with the Toyota Corolla car of Gruspe;
Gruspes car was a total wreck. The next day, on October 25, 1999, Cruz, along with Leonardo Q. Ibias
went to Gruspes office, apologized for the incident, and executed a Joint Affidavit of Undertaking
promising jointly and severally to replace the Gruspes damaged car in 20 days, or until November 15,
1999, of the same model and of at least the same quality; or, alternatively, they would pay the cost of
Gruspes car amounting to P350,000.00, with interest at
12% per month for any delayed payment after November 15, 1999, until fully paid.5 When Cruz and
Leonardo failed to comply with their undertaking, Gruspe filed a complaint for collection of sum of
money against them on November 19, 1999 before the RTC.
In their answer, Cruz and Leonardo denied Gruspes allegation, claiming that Gruspe, a lawyer,
prepared the Joint Affidavit of Undertaking and forced them to affix their signatures thereon, without
explaining and informing them of its contents; Cruz affixed his signature so that his mini bus could be
released as it was his only means of income; Leonardo, a barangay official, accompanied Cruz to
Gruspes office for the release of the mini bus, but was also deceived into signing the Joint Affidavit of
Undertaking.

In their appeal by certiorari with the Court, Cruz and Esperanza assail the CA ruling, contending that
the Joint Affidavit of Undertaking is not a contract that can be the basis of an obligation to pay a sum of
money in favor of Gruspe. They consider an affidavit as different from a contract: an affidavits purpose
is simply to attest to facts that are within his knowledge, while a contract requires that there be a
meeting of the minds between the two contracting parties.
Even if the Joint Affidavit of Undertaking was considered as a contract, Cruz and Esperanza claim that
it is invalid because Cruz and Leonardos consent thereto was vitiated; the contract was prepared by
Gruspe who is a lawyer, and its contents were never explained to them. Moreover, Cruz and Leonardo
were simply forced to affix their signatures, otherwise, the mini van would not be released.
Also, they claim that prior to the filing of the complaint for sum of money, Gruspe did not make any
demand upon them. Hence, pursuant to Article 1169 of the Civil Code, they could not be considered in
default. Without this demand, Cruz and Esperanza contend that Gruspe could not yet take any action.
THE COURTS RULING
The Court finds the petition partly meritorious and accordingly modifies the judgment of the CA.
Contracts are obligatory no matter what their forms may be, whenever the essential requisites for their
validity are present. In determining whether a document is an affidavit or a contract, the Court looks
beyond the title of the document, since the denomination or title given by the parties in their document
is not conclusive of the nature of its contents.8 In the construction or interpretation of an instrument, the
intention of the parties is primordial and is to be pursued. If the terms of the document are clear and
leave no doubt on the intention of the contracting parties, the literal meaning of its stipulations shall
control. If the words appear to be contrary to the parties evident intention, the latter shall prevail over
the former.9
A simple reading of the terms of the Joint Affidavit of Undertaking readily discloses that it contains
stipulations characteristic of a contract. As quoted in the CA decision,10 the Joint Affidavit of
Undertaking contained a stipulation where Cruz and Leonardo promised to replace the damaged car of
Gruspe, 20 days from October 25, 1999 or up to November 15, 1999, of the same model and of at
least the same quality. In the event that they cannot replace the car within the same period, they would
pay the cost of Gruspes car in the total amount ofP350,000.00, with interest at 12% per month for any
delayed payment after November 15, 1999, until fully paid. These, as read by the CA, are very simple
terms that both Cruz and Leonardo could easily understand.

There is also no merit to the argument of vitiated consent.1wphi1 An allegation of vitiated consent
must be proven by preponderance of evidence; Cruz and Leonardo failed to support their allegation.
Although the undertaking in the affidavit appears to be onerous and lopsided, this does not necessarily
prove the alleged vitiation of consent. They, in fact, admitted the genuineness and due execution of the
Joint Affidavit and Undertaking when they said that they signed the same to secure possession of their
vehicle. If they truly believed that the vehicle had been illegally impounded, they could have refused to
sign the Joint Affidavit of Undertaking and filed a complaint, but they did not. That the release of their
mini bus was conditioned on their signing the Joint Affidavit of Undertaking does not, by itself, indicate
that their consent was forced they may have given it grudgingly, but it is not indicative of a vitiated
consent that is a ground for the annulment of a contract.

PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari2are the Decision3 dated October 21, 2011 and
Resolution4 dated February 8, 2012 of the Court of Appeals (CA) in CA-G.R. CV No. 89426 which
reversed and set aside the Decision5 dated February 28, 2007 of the Regional Trial Court of Makati,
Branch 148 (RTC) in Civil Case No. 02-1248, holding petitioner ACE Foods, Inc. (ACE Foods) liable to
respondent Micro Pacific Technologies Co., Ltd. (MTCL) for the payment of Cisco Routers and Frame
Relay Products (subject products) amounting toP646,464.00 pursuant to a perfected contract of sale.
The Facts

Thus, on the issue of the validity and enforceability of the Joint Affidavit of Undertaking, the CA did not
commit any legal error that merits the reversal of the assailed decision.

ACE Foods is a domestic corporation engaged in the trading and distribution of consumer goods in
wholesale and retail bases,6 while MTCL is one engaged in the supply of computer hardware and
equipment.7

Nevertheless, the CA glossed over the issue of demand which is material in the computation of interest
on the amount due. The RTC ordered Cruz and Leonardo to pay Gruspe "P350,000.00 as cost of the
car xxx plus fifteen percent (15%) per annum from November 15, 1999 until fully paid."11 The 15%
interest (later modified by the CA to be 12%) was computed from November 15, 1999 the date
stipulated in the Joint Affidavit of Undertaking for the payment of the value of Gruspes car. In the
absence of a finding by the lower courts that Gruspe made a demand prior to the filing of the
complaint, the interest cannot be computed from November 15, 1999 because until a demand has
been made, Cruz and Leonardo could not be said to be in default.12 "In order that the debtor may be in
default, it is necessary that the following requisites be present: (1) that the obligation be demandable
and already liquidated; (2) that the debtor delays performance; and (3) that the creditor requires the
performance judicially and extrajudicially."13 Default generally begins from the moment the creditor
demands the performance of the obligation. In this case, demand could be considered to have been
made upon the filing of the complaint on November 19, 1999, and it is only from this date that the
interest should be computed.

On September 26, 2001, MTCL sent a letter-proposal8 for the delivery and sale of the subject products
to be installed at various offices of ACE Foods. Aside from the itemization of the products offered for
sale, the said proposal further provides for the following terms, viz.:9
TERMS : Thirty (30) days upon delivery
VALIDITY : Prices are based on current dollar rate and subject to changes without prior notice.
DELIVERY : Immediate delivery for items on stock, otherwise thirty (30) to forty-five days upon receipt
of [Purchase Order]
WARRANTY : One (1) year on parts and services. Accessories not included in warranty.

Although the CA upheld the Joint Affidavit of Undertaking, we note that it imposed interest rate on a per
annum basis, instead of the per month basis that was stated in the Joint Affidavit of Undertaking
without explaining its reason for doing so.14 Neither party, however, questioned the change.
Nonetheless, the Court affirms the change in the interest rate from 12% per month to 12% per annum,
as we find the interest rate agreed upon in the Joint Affidavit of Undertaking excessive. 15
WHEREFORE, we AFFIRM the decision dated July 30, 2009 and the resolution dated February 19,
2010 of the Court of Appeals in CA-G.R. CV No. 86083, subject to the Modification that the twelve
percent (12%) per annum interest imposed on the amount due shall accrue only from November 19,
1999, when judicial demand was made.

On October 29, 2001, ACE Foods accepted MTCLs proposal and accordingly issued Purchase Order
No. 10002310 (Purchase Order) for the subject products amounting to P646,464.00 (purchase price).
Thereafter, or on March 4, 2002, MTCL delivered the said products to ACE Foods as reflected in
Invoice No. 7733 11 (Invoice Receipt). The fine print of the invoice states, inter alia, that "[t]itle to sold
property is reserved in MICROPACIFIC TECHNOLOGIES CO., LTD. until full compliance of the terms
and conditions of above and payment of the price"12(title reservation stipulation). After delivery, the
subject products were then installed and configured in ACE Foodss premises. MTCLs demands
against ACE Foods to pay the purchase price, however, remained unheeded.13 Instead of paying the
purchase price, ACE Foods sent MTCL a Letter14 dated September 19, 2002, stating that it "ha[s] been
returning the [subject products] to [MTCL] thru [its] sales representative Mr. Mark Anteola who has
agreed to pull out the said [products] but had failed to do so up to now."

SO ORDERED.
Eventually, or on October 16, 2002, ACE Foods lodged a Complaint15 against MTCL before the RTC,
praying that the latter pull out from its premises the subject products since MTCL breached its "after
delivery services" obligations to it, particularly, to: (a) install and configure the subject products; (b)
submit a cost benefit study to justify the purchase of the subject products; and (c) train ACE Foodss
technicians on how to use and maintain the subject products. 16 ACE Foods likewise claimed that the
subject products MTCL delivered are defective and not working.17

4. ACE Foods, Inc. vs. Micro Pacific


G.R. No. 200602

December 11, 2013

ACE FOODS, INC., Petitioner,


vs.
MICRO PACIFIC TECHNOLOGIES CO., LTD.1, Respondent.
DECISION

For its part, MTCL, in its Answer with Counterclaim,18 maintained that it had duly complied with its
obligations to ACE Foods and that the subject products were in good working condition when they
were delivered, installed and configured in ACE Foodss premises. Thereafter, MTCL even conducted
a training course for ACE Foodss representatives/employees; MTCL, however, alleged that there was
actually no agreement as to the purported "after delivery services." Further, MTCL posited that ACE
Foods refused and failed to pay the purchase price for the subject products despite the latters use of
the same for a period of nine (9) months. As such, MTCL prayed that ACE Foods be compelled to pay
the purchase price, as well as damages related to the transaction.19

The RTC Ruling


On February 28, 2007, the RTC rendered a Decision, 20 directing MTCL to remove the subject products
from ACE Foodss premises and pay actual damages and attorney fees in the amounts of P200,000.00
and P100,000.00, respectively.21
At the outset, it observed that the agreement between ACE Foods and MTCL is in the nature of a
contract to sell. Its conclusion was based on the fine print of the Invoice Receipt which expressly
indicated that "title to sold property is reserved in MICROPACIFIC TECHNOLOGIES CO., LTD. until
full compliance of the terms and conditions of above and payment of the price," noting further that in a
contract to sell, the prospective seller explicitly reserves the transfer of title to the prospective buyer,
and said transfer is conditioned upon the full payment of the purchase price.22 Thus, notwithstanding
the execution of the Purchase Order and the delivery and installation of the subject products at the
offices of ACE Foods, by express stipulation stated in the Invoice Receipt issued by MTCL and signed
by ACE Foods, i.e., the title reservation stipulation, it is still the former who holds title to the products
until full payment of the purchase price therefor. In this relation, it noted that the full payment of the
price is a positive suspensive condition, the non-payment of which prevents the obligation to sell on the
part of the seller/vendor from materializing at all.23 Since title remained with MTCL, the RTC therefore
directed it to withdraw the subject products from ACE Foodss premises. Also, in view of the foregoing,
the RTC found it unnecessary to delve into the allegations of breach since the non-happening of the
aforesaid suspensive condition ipso jure prevented the obligation to sell from arising.24

A contract is what the law defines it to be, taking into consideration its essential elements, and not what
the contracting parties call it.33 The real nature of a contract may be determined from the express terms
of the written agreement and from the contemporaneous and subsequent acts of the contracting
parties. However, in the construction or interpretation of an instrument, the intention of the parties is
primordial and is to be pursued. The denomination or title given by the parties in their contract is not
conclusive of the nature of its contents.34
The very essence of a contract of sale is the transfer of ownership in exchange for a price paid or
promised.35 This may be gleaned from Article 1458 of the Civil Code which defines a contract of sale
as follows:
Art. 1458. By the contract of sale one of the contracting parties obligates himself to transfer the
ownership and to deliver a determinate thing, and the other to pay therefor a price certain in money
or its equivalent.
A contract of sale may be absolute or conditional. (Emphasis supplied)
Corollary thereto, a contract of sale is classified as a consensual contract, which means that the sale
is perfected by mere consent. No particular form is required for its validity. Upon perfection of the
contract, the parties may reciprocally demand performance, i.e., the vendee may compel transfer of
ownership of the object of the sale, and the vendor may require the vendee to pay the thing sold.36

Dissatisfied, MTCL elevated the matter on appeal.25


The CA Ruling
In a Decision26 dated October 21, 2011, the CA reversed and set aside the RTCs ruling, ordering ACE
Foods to pay MTCL the amount of P646,464.00, plus legal interest at the rate of 6% per annum to be
computed from April 4, 2002, and attorneys fees amounting to P50,000.00.27
It found that the agreement between the parties is in the nature of a contract of sale, observing that the
said contract had been perfected from the time ACE Foods sent the Purchase Order to MTCL which, in
turn, delivered the subject products covered by the Invoice Receipt and subsequently installed and
configured them in ACE Foodss premises.28 Thus, considering that MTCL had already complied with
its obligation, ACE Foodss corresponding obligation arose and was then duty bound to pay the agreed
purchase price within thirty (30) days from March 5, 2002.29 In this light, the CA concluded that it was
erroneous for ACE Foods not to pay the purchase price therefor, despite its receipt of the subject
products, because its refusal to pay disregards the very essence of reciprocity in a contract of
sale.30 The CA also dismissed ACE Foodss claim regarding MTCLs failure to perform its "after
delivery services" obligations since the letter-proposal, Purchase Order and Invoice Receipt do not
reflect any agreement to that effect.31
Aggrieved, ACE Foods moved for reconsideration which was, however, denied in a Resolution
February 8, 2012, hence, this petition.

32

In contrast, a contract to sell is defined as a bilateral contract whereby the prospective seller, while
expressly reserving the ownership of the property despite delivery thereof to the prospective buyer,
binds himself to sell the property exclusively to the prospective buyer upon fulfillment of the condition
agreed upon, i.e., the full payment of the purchase price. A contract to sell may not even be considered
as a conditional contract of sale where the seller may likewise reserve title to the property subject of
the sale until the fulfillment of a suspensive condition, because in a conditional contract of sale, the first
element of consent is present, although it is conditioned upon the happening of a contingent event
which may or may not occur.37
In this case, the Court concurs with the CA that the parties have agreed to a contract of sale and not to
a contract to sell as adjudged by the RTC. Bearing in mind its consensual nature, a contract of sale
had been perfected at the precise moment ACE Foods, as evinced by its act of sending MTCL the
Purchase Order, accepted the latters proposal to sell the subject products in consideration of the
purchase price of P646,464.00. From that point in time, the reciprocal obligations of the parties i.e.,
on the one hand, of MTCL to deliver the said products to ACE Foods, and, on the other hand, of ACE
Foods to pay the purchase price therefor within thirty (30) days from delivery already arose and
consequently may be demanded. Article 1475 of the Civil Code makes this clear:
Art. 1475. The contract of sale is perfected at the moment there is a meeting of minds upon the thing
which is the object of the contract and upon the price.

dated
From that moment, the parties may reciprocally demand performance, subject to the provisions of the
law governing the form of contracts.

The Issue Before the Court


The essential issue in this case is whether ACE Foods should pay MTCL the purchase price for the
subject products.
The Courts Ruling
The petition lacks merit.

At this juncture, the Court must dispel the notion that the stipulation anent MTCLs reservation of
ownership of the subject products as reflected in the Invoice Receipt, i.e., the title reservation
stipulation, changed the complexion of the transaction from a contract of sale into a contract to sell.
Records are bereft of any showing that the said stipulation novated the contract of sale between the
parties which, to repeat, already existed at the precise moment ACE Foods accepted MTCLs
proposal. To be sure, novation, in its broad concept, may either be extinctive or modificatory. It is
extinctive when an old obligation is terminated by the creation of a new obligation that takes the place
of the former; it is merely modificatory when the old obligation subsists to the extent it remains
compatible with the amendatory agreement. In either case, however, novation is never presumed, and
the animus novandi, whether totally or partially, must appear by express agreement of the parties, or
by their acts that are too clear and unequivocal to be mistaken.38

In the present case, it has not been shown that the title reservation stipulation appearing in the Invoice
Receipt had been included or had subsequently modified or superseded the original agreement of the
parties. The fact that the Invoice Receipt was signed by a representative of ACE Foods does not, by
and of itself, prove animus novandi since: (a) it was not shown that the signatory was authorized by
ACE Foods (the actual party to the transaction) to novate the original agreement; (b) the signature only
proves that the Invoice Receipt was received by a representative of ACE Foods to show the fact of
delivery; and (c) as matter of judicial notice, invoices are generally issued at the consummation stage
of the contract and not its perfection, and have been even treated as documents which are not
actionable per se, although they may prove sufficient delivery. 39 Thus, absent any clear indication that
the title reservation stipulation was actually agreed upon, the Court must deem the same to be a mere
unilateral imposition on the part of MTCL which has no effect on the nature of the parties original
agreement as a contract of sale. Perforce, the obligations arising thereto, among others, ACE Foodss
obligationto pay the purchase price as well as to accept the delivery of the goods,40 remain
enforceable and subsisting.1wphi1
As a final point, it may not be amiss to state that the return of the subject products pursuant to a
rescissory action41 is neither warranted by ACE Foodss claims of breach either with respect to
MTCLs breach of its purported "after delivery services" obligations or the defective condition of the
products - since such claims were not adequately proven in this case. The rule is clear: each party
must prove his own affirmative allegation; one who asserts the affirmative of the issue has the burden
of presenting at the trial such amount of evidence required by law to obtain a favorable judgment,
which in civil cases, is by preponderance of evidence. 42 This, however, ACE Foods failed to observe
as regards its allegations of breach. Hence, the same cannot be sustained.
WHEREFORE, the petition is DENIED. Accordingly, the Decision dated October 21, 2011 and
Resolution dated February 8, 2012 of the Court of Appeals in CA-G.R. CV No. 89426 are
hereby AFFIRMED.
SO ORDERED.
5. Locsin II vs. Mekeni Food Corporation
G.R. NO. 192105

December 9, 2013

ANTONIO LOCSIN, II, Petitioner,


vs.
MEKENI FOOD CORPORATION, Respondent.

Sales Manager to over see Mekenis National Capital Region Supermarket/Food Service and South
Luzon operations. In addition to a compensation and benefit package, Mekeni offered petitioner a car
plan, under which one-half of the cost of the vehicle is to be paid by the company and the other half to
be deducted from petitioners salary. Mekenis offer was contained in an Offer Sheet 5 which was
presented to petitioner.
Petitioner began his stint as Mekeni Regional Sales Manager on March 17, 2004. To be able to
effectively cover his appointed sales territory, Mekeni furnished petitioner with a used Honda Civic car
valued at P280,000.00, which used to be the service vehicle of petitioners immediate supervisor.
Petitioner paid for his 50% share through salary deductions of P5,000.00 each month.
Subsequently, Locsin resigned effective February 25, 2006. By then, a total of P112,500.00 had been
deducted from his monthly salary and applied as part of the employees share in the car plan. Mekeni
supposedly put in an equivalent amount as its share under the car plan. In his resignation letter,
petitioner made an offer to purchase his service vehicle by paying the outstanding balance thereon.
The parties negotiated, but could not agree on the terms of the proposed purchase. Petitioner thus
returned the vehicle to Mekeni on May 2, 2006.
Petitioner made personal and written follow-ups regarding his unpaid salaries, commissions, benefits,
and offer to purchase his service vehicle. Mekeni replied that the company car plan benefit applied only
to employees who have been with the company for five years; for this reason, the balance that
petitioner should pay on his service vehicle stood at P116,380.00 if he opts to purchase the same.
On May 3, 2007, petitioner filed against Mekeni and/or its President, Prudencio S. Garcia, a
Complaint6for the recovery of monetary claims consisting of unpaid salaries, commissions,
sick/vacation leave benefits, and recovery of monthly salary deductions which were earmarked for his
cost-sharing in the car plan. The case was docketed in the National Labor Relations
Commission(NLRC), National Capital Region(NCR), Quezon City as NLRC NCR CASE NO. 00-0504139-07.
On October 30, 2007, Labor Arbiter Cresencio G. Ramos rendered a Decision,7 decreeing as follows:
WHEREFORE, in the light of the foregoing premises, judgment is hereby rendered directing
respondents to turn-over to complainant x x x the subject vehicle upon the said complainants payment
to them of the sum ofP100,435.84.SO ORDERED.8 Ruling of the National Labor Relations
Commission On appeal,9 the Labor Arbiters Decision was reversed in a February 27, 2009
Decision10 of the NLRC, thus: WHEREFORE, premises considered, the appeal is hereby Granted. The
assailed Decision dated October 30, 2007 is hereby REVERSED and SET ASIDE and a new one
entered ordering respondent-appellee Mekeni Food Corporation to pay complainant-appellee the
following:

DECISION
1.Unpaid Salary in the amount of P12,511.45;
DEL CASTILLO, J.:
2.Unpaid sick leave/vacation leave pay in the amount of P14,789.15;
In the absence of specific terms and conditions governing a car plan agreement between the employer
and employe former may not retain the installment payments made by the latter on the car plan and
treat them as rents for the use of the service vehicle, in the event that the employee ceases his
employment and is unable to complete the installment payments on the vehicle. The underlying reason
is that the service vehicle was precisely used in the former' s business; any personal benefit obtained
by the employee from its use is merely incidental. This Petition for Review on Certiorari1 assails the
January 27, 2010 Decision2 of the Court of Appeals (CA) in CA-G.R. SP No. 109550, as well as its
April 23, 2010 Resolution3 denying petitioners Motion for Partial Reconsideration.4

3.Unpaid commission in the amount of P9,780.00; and


4.Reimbursement of complainants payment under the car plan agreement in the amount
of P112,500.00; and
5.The equivalent share of the company as part of the complainants benefit under the car plan 50/50
sharing amounting to P112,500.00.

Factual Antecedents
In February 2004, respondent Mekeni Food Corporation(Mekeni)a Philippine company engaged in
food manufacturing and meat processing offered petitioner Antonio Locsin II the position of Regional

Respondent-Appellee Mekeni Food Corporation is hereby authorized to deduct the sum of P4,736.50
representing complainant-appellants cash advance from his total monetary award.

All other claims are dismissed for lack of merit.

Ruling of the Court of Appeals

SO ORDERED.11 The NLRC held that petitioners amortization payments on his service vehicle
amounting toP112,500.00 should be reimbursed; if not, unjust enrichment would result, as the vehicle
remained in the possession and ownership of Mekeni.

Mekeni filed a Petition for Certiorari13 with the CA assailing the NLRCs February 27, 2009 Decision,
saying that the NLRC committed grave abuse of discretion in holding it liable to petitioner as it had no
jurisdiction to resolve petitioners claims, which are civil in nature.

On October 30, 2007, Labor Arbiter Cresencio G. Ramos rendered a Decision,7 decreeing as follows:

On January 27, 2010, the CA issued the assailed Decision, decreeing as follows:

WHEREFORE, in the light of the foregoing premises, judgment is hereby rendered directing
respondents to turn-over to complainant x x xthe subject vehicle upon the said complainants payment
to them of the sum ofP100,435.84.
SO ORDERED.8

WHEREFORE, the petition for certiorari is GRANTED. The Decision of the National Labor Relations
Commission dated 27 February 2009, in NLRC NCR Case No. 00-05-04139-07, and its Resolution
dated 30 April 2009 denying reconsideration thereof, are MODIFIED in that the reimbursement of
Locsins payment under the car plan in the amount of P112,500.00, and the payment to him of
Mekenis 50% share in the amount of P112,500.00 are DELETED. The rest of the decision is
AFFIRMED.

Ruling of the National Labor Relations Commission

SO ORDERED.14

On appeal,9 the Labor Arbiters Decision was reversedin a February 27, 2009 Decision10of the NLRC,
thus:

In arriving at the above conclusion, the CA held that the NLRC possessed jurisdiction over petitioners
claims, including the amounts he paid under the car plan, since his Complaint against Mekeni is one
for the payment of salaries and employee benefits. With regard to the car plan arrangement, the CA
applied the ruling in Elisco Tool Manufacturing Corporation v. Court of Appeals,15 where it was held
that

WHEREFORE, premises considered, the appeal is hereby Granted. The assailed Decision dated
October 30, 2007 is hereby REVERSED and SET ASIDE and a new one entered ordering respondentappellee Mekeni Food Corporation to pay complainant-appellee the following:
1.Unpaid Salary in the amount of P12,511.45;
2.Unpaid sick leave/vacation leave pay in the amount of P14,789.15;
3.Unpaid commission in the amount of P9,780.00; and
4.Reimbursement of complainants payment under the car plan agreement in the amount
of P112,500.00; and
5.The equivalent share of the company as part of the complainants benefit under the car plan 50/50
sharing amounting to P112,500.00.
Respondent-Appellee Mekeni Food Corporation is hereby authorized to deduct the sum of P4,736.50
representing complainant-appellants cash advance from his total monetary award.

First. Petitioner does not deny that private respondent Rolando Lantan acquired the vehicle in question
under a car plan for executives of the Elizalde group of companies. Under a typical car plan, the
company advances the purchase price of a car to be paid back by the employee through monthly
deductions from his salary. The company retains ownership of the motor vehicle until it shall have been
fully paid for. However, retention of registration of the car in the companys name is only a form of a
lien on the vehicle in the event that the employee would abscond before he has fully paid for it. There
are also stipulations in car plan agreements to the effect that should the employment of the employee
concerned be terminated before all installments are fully paid, the vehicle will be taken by the employer
and all installments paid shall be considered rentals per agreement.16
In the absence of evidence as to the stipulations of the car plan arrangement between Mekeni and
petitioner, the CA treated petitioners monthly contributions in the total amount of P112,500.00 as
rentals for the use of his service vehicle for the duration of his employment with Mekeni. The appellate
court applied Articles 1484-1486 of the Civil Code,17 and added that the installments paid by petitioner
should not be returned to him inasmuch as the amounts are not unconscionable. It made the following
pronouncement:

SO ORDERED.11

Having used the car in question for the duration of his employment, it is but fair that all of Locsins
payments be considered as rentals therefor which may be forfeited by Mekeni. Therefore, Mekeni has
no obligation to return these payments to Locsin. Conversely, Mekeni has no right to demand the
payment of the balance of the purchase price from Locsin since the latter has already surrendered
possession of the vehicle.18

The NLRC held that petitioners amortization payments on his service vehicle amounting
to P112,500.00 should be reimbursed; if not, unjust enrichment would result, as the vehicle remained
in the possession and ownership of Mekeni.

Moreover, the CA held that petitioner cannot recover Mekenis corresponding share in the purchase
price of the service vehicle, as this would constitute unjust enrichment on the part of petitioner at
Mekenis expense.

In addition, the employers share in the monthly car plan payments should likewise be awarded to
petitioner because it forms part of the latters benefits under the car plan. It held further that Mekenis
claim that the company car plan benefit applied only to employees who have been with the company
for five years has not been substantiated by its evidence, in which case the car plan agreement should
be construed in petitioners favor. Mekeni moved to reconsider, but in an April 30, 2009
Resolution,12 the NLRC sustained its original findings.

The CA affirmed the NLRC judgment in all other respects. Petitioner filed his Motion for Partial
Reconsideration,19but the CA denied the same in its April 23, 2010 Resolution.

All other claims are dismissed for lack of merit.

Thus, petitioner filed the instant Petition; Mekeni, on the other hand, took no further action.

Issue

Petition, then, is whether petitioner is entitled to a refund of all the amounts applied to the cost of the
service vehicle under the car plan.

Petitioner raises the following solitary issue:


WITH ALL DUE RESPECT, THE HONORABLE COURT OF APPEALS ERRED IN NOT
CONSIDERING THE CAR PLAN PRIVILEGE AS PART OF THE COMPENSATION PACKAGE
OFFERED TO PETITIONER AT THE INCEPTION OF HIS EMPLOYMENT AND INSTEAD LIKENED
IT TO A CAR LOAN ON INSTALLMENT, IN SPITE OF THE ABSENCE OF EVIDENCE
ONRECORD.20
Petitioners Arguments
In his Petition and Reply,21 petitioner mainly argues that the CA erred in treating his monthly
contributions to the car plan, totaling P112,500.00, as rentals for the use of his service vehicle during
his employment; the car plan which he availed ofwasa benefit and it formed part of the package of
economic benefits granted to him when he was hired as Regional Sales Manager. Petitioner submits
that this is shown by the Offer Sheet which was shown to him and which became the basis for his
decision to accept the offer and work for Mekeni.
Petitioner adds that the absence of documentary or other evidence showing the terms and conditions
of the Mekeni company car plan cannot justify a reliance on Mekenis self-serving claimsthat the full
terms thereof applied only to employees who have been with the company for at least five years; in the
absence of evidence, doubts should be resolved in his favor pursuant to the policy of the law that
affords protection to labor, as well asthe principle that all doubts shouldbe construed to its benefit.
Finally, petitioner submits that the ruling in the Elisco Tool casecannot apply to his case because the
car plan subject of the said case involved a car loan, which his car plan benefit was not; it was part of
his compensation package, and the vehicle was an important component of his work which required
constant and uninterrupted mobility. Petitioner claims that the car plan was in fact more beneficial to
Mekeni than to him; besides, he did not choose to avail of it, as it was simply imposed upon him. He
concludes that it is only just that his payments should be refunded and returned to him.
Petitioner thus prays for the reversal of the assailed CA Decision and Resolution, and that the Court
reinstate the NLRCs February 27, 2009 Decision.
Respondents Arguments
In its Comment,22 Mekeni argues that the Petition does not raise questions of law, but merely of fact,
which thus requires the Court to review anew issues already passed upon by the CA an unauthorized
exercise given that the Supreme Court is not a trier of facts, nor is it its function to analyze or weigh the
evidence of the parties all over again.23 It adds that the issue regarding the car plan and the
conclusions of the CA drawn from the evidence on record are questions of fact.
Mekeni asserts further that the service vehicle was merely a loan which had to be paid through the
monthly salary deductions.If it is not allowed to recover on the loan, this would constitute unjust
enrichment on the part of petitioner.

When the conclusions of the CA are grounded entirely on speculation, surmises and conjectures, or
when the inferences made by it are manifestly mistaken or absurd, its findings are subject to review by
this Court.24
From the evidence on record, it is seen that the Mekeni car plan offered to petitioner was subject to no
other term or condition than that Mekeni shall cover one-half of its value, and petitioner shall in turn pay
the other half through deductions from his monthly salary.Mekeni has not shown, by documentary
evidence or otherwise, that there are other terms and conditions governing its car plan agreement with
petitioner. There is no evidence to suggest that if petitioner failed to completely cover one-half of the
cost of the vehicle, then all the deductions from his salary going to the cost of the vehicle will be treated
as rentals for his use thereof while working with Mekeni, and shall not be refunded. Indeed, there is no
such stipulation or arrangement between them. Thus, the CAs reliance on Elisco Tool is without basis,
and its conclusions arrived at in the questioned decision are manifestly mistaken. To repeat what was
said in Elisco Tool
First. Petitioner does not deny that private respondent Rolando Lantan acquired the vehicle in question
under a car plan for executives of the Elizalde group of companies. Under a typical car plan, the
company advances the purchase price of a car to be paid back by the employee through monthly
deductions from his salary. The company retains ownership of the motor vehicle until it shall have been
fully paid for. However, retention of registration of the car in the companys name is only a form of a
lien on the vehicle in the event that the employee would abscond before he has fully paid for it. There
are also stipulations in car plan agreements to the effect that should the employment of the employee
concerned be terminated before all installments are fully paid, the vehicle will be taken by the employer
and all installments paid shall be considered rentals per agreement.25 (Emphasis supplied)
It was made clear in the above pronouncement that installments made on the car plan may be treated
as rentals only when there is an express stipulation in the car plan agreement to such effect. It was
therefore patent error for the appellate court to assume that, even in the absence of express
stipulation, petitioners payments on the car plan may be considered as rentals which need not be
returned.
Indeed, the Court cannot allow that payments made on the car plan should be forfeited by Mekeni and
treated simply as rentals for petitioners use of the company service vehicle. Nor may they be retained
by it as purported loan payments, as it would have this Court believe. In the first place, there is
precisely no stipulation to such effect in their agreement. Secondly, it may not be said that the car plan
arrangement between the parties was a benefit that the petitioner enjoyed; on the contrary, it wasan
absolute necessity in Mekenis business operations, which benefit edit to the fullest extent: without the
service vehicle, petitioner would have been unable to rapidly cover the vast sales territory assigned to
him, and sales or marketing of Mekenis products could not have been booked or made fast enough to
move Mekenis inventory. Poor sales, inability to market Mekenis products, a high rate of product spoil
age resulting from stagnant inventory, and poor monitoring of the sales territory are the necessary
consequences of lack of mobility. Without a service vehicle, petitioner would have been placed at the
mercy of inefficient and unreliable public transportation; his official schedule would have been
dependent on the arrival and departure times of buses or jeeps, not to mention the availability of seats
in them. Clearly, without a service vehicle, Mekenis business could only prosper at a snails pace, if
not completely paralyzed. Its cost of doing business would be higher as well. The Court expressed just
such a view in the past. Thus

Our Ruling
The Petition is partially granted.
To begin with, the Court notes that Mekeni did not file a similar petition questioning the CA Decision;
thus, it is deemed to have accepted what was decreed. The only issue that must be resolved in this

In the case at bar, the disallowance of the subject car plan benefits would hamper the officials in the
performance of their functions to promote and develop trade which requires mobility in the performance
of official business. Indeed, the car plan benefits are supportive of the implementation of the objectives
and mission of the agency relative to the nature of its operation and responsive to the exigencies of the
service.26 (Emphasis supplied) Any benefit or privilege enjoyed by petitioner from using the service
vehicle was merely incidental and insignificant, because for the most part the vehicle was under
Mekenis control and supervision. Free and complete disposal is given to the petitioner only after the

vehicles cost is covered or paid in full. Until then, the vehicle remains at the beck and call of Mekeni.
Given the vast territory petitioner had to cover to be able to perform his work effectively and generate
business for his employer, the service vehicle was an absolute necessity, or else Mekenis business
would suffer adversely. Thus, it is clear that while petitioner was paying for half of the vehicles value,
Mekeni was reaping the full benefits from the use thereof.
In light of the foregoing, it is unfair to deny petitioner a refund of all his contributions to the car plan.
Under Article 22 of the Civil Code, "[e]very person who through an act of performance by another, or
any other means, acquires or comes into possession of something at the expense of the latter without
just or legal ground, shall return the same to him." Article 214227of the same Code likewise clarifies
that there are certain lawful, voluntary and unilateral acts which give rise to the juridical relation of
quasi-contract, to the end that no one shall be unjustly enriched or benefited at the expense of another.
In the absence of specific terms and conditions governing the car plan arrangement between the
petitioner and Mekeni, a quasi-contractual relation was created between them. Consequently, Mekeni
may not enrich itself by charging petitioner for the use of its vehicle which is otherwise absolutely
necessaryto the full and effective promotion of its business. It may not, under the claim that petitioners
payments constitute rents for the use of the company vehicle, refuse to refund what petitioner had
paid, for the reasons that the car plan did not carry such a condition; the subject vehicle is an old car
that is substantially, if not fully, depreciated; the car plan arrangement benefited Mekeni for the most
part; and any personal benefit obtained by petitioner from using the vehicle was merely incidental.
Conversely, petitioner cannot recover the monetary value of Mekenis counterpart contribution to the
cost of the vehicle; that is not property or money that belongs to him, nor was it intended to be given to
him in lieu of the car plan. In other words, Mekenis share of the vehicles cost was not part of
petitioners compensation package. To start with, the vehicle is an asset that belonged to Mekeni. Just
as Mekeni is unjustly enriched by failing to refund petitioners payments, so should petitioner not be
awarded the value of Mekenis counter part contribution to the car plan, as this would unjustly enrich
him at Mekenis expense.
There is unjust enrichment ''when a person unjustly retains a benefit to the loss of another, or when a
person retains money or property of another against the fundamental principles of justice, equity and
good conscience." The principle of unjust enrichment requires two conditions: (1) that a person is
benefited without a valid basis or justification, and (2) that such benefit is derived at the expense of
another. The main objective of the principle against unjust enrichment is to prevent one from enriching
himself at the expense of another without just cause or consideration. x x x28
WHEREFORE, the Petition is GRANTED IN PART. The assailed January 27, 2010 Decision and April
23, 2010 Resolution of the Court of Appeals in CA-G.R. SP No. 109550 are MODIFIED, in that
respondent Mekeni Food Corporation is hereby ordered to REFUND petitioner Antonio Locsin II's
payments under the car plan agreement in the total amount ofP112,500.00.
Thus, except for the counterpart or equivalent share of Mekeni Food Corporation in the car plan
agreement amounting to P112,500.00, which is DELETED, the February 27, 2009 Decision of the
National Labor Relations Commission is affirmed in all respects.
SO ORDERED.
6. Barredo vs. Garcia
G.R. No. L-48006

July 8, 1942

Laws Applicable: ART. 1089, ART. 1092, ART. 1093, ART. 1094 of the Civil Code, ART. 101, ART.
102, ART. 103, ART. 365 of RPC
Lessons Applicable: Quasi-delict (Torts and Damages)

FACTS:
May 3, 1936 1:30 am: 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 its passenger Faustino Garcia (16 years old boy) suffered
injuries from which he died two days later
Fontanilla 's negligence was the cause of the mishap
he was driving on the wrong side of the road and at high speed
criminal action was filed against Fontanilla in the CFI
CA affirmed CFI: he was convicted and sentenced to an indeterminate sentence of 1 year and 1
day to 2 years of prision correccional. The court in the criminal case granted the petition that the
right to bring a separate civil action be reserved.
March 7, 1939: parents Severino Garcia and Timotea Almario brought an action in the CFI of
Manila against Fausto Barredo as the sole proprietor of the Malate Taxicab and employer of
Fontanilla
Barredo was careless in employing Fontanilla who had been caught several times for violation of
the Automobile Law and speeding 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
defense: liability of Barredo is governed by the RPC>liability is only subsidiary (no civil
action against the driver Fontanilla Barredo cannot be held responsible in the case)
CFI awarded damages for P2,000 plus legal interest
CA: reduced the damages to P1,000 w/ legal interest
Applied Article 1903: applicable only to those (obligations) arising from wrongful or negligent acts or
commission not punishable by law
by reason of his negligence in the selection or supervision of his servant or employee
ISSUE: W/N the parents may bring separate civil action against Barredo, thus making him primarily
and directly, responsible under article 1903 of the Civil Code as an employer

HELD: YES. CA Affirmed.


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.

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 orspecial 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."

Some of the differences between crimes under the Penal Code and the culpa aquiliana or cuasidelito 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.

Penal Code
minors and incapacitated
persons
direct (article 19)

Civil Code
other persons
subsidiary (articles 20 and 21)

direct(Art. 1903)

same act may come under both the Penal Code and the Civil Code
interpretation of the words of article 1093 "fault or negligence not punished by law"
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 preexisting 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.
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."
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
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
Rationales:
1.
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
2.
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

3.

4.

Civil Code. Otherwise, there would be many instances of unvindicated civil wrongs. Ubi jus ibi
remedium.
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
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

7. Gutierrez vs. Gutierrez

G.R. No. 34840

September 23, 1931

NARCISO GUTIERREZ, plaintiff-appellee,


vs.
BONIFACIO GUTIERREZ, MARIA V. DE GUTIERREZ, MANUEL GUTIERREZ, ABELARDO
VELASCO, and SATURNINO CORTEZ, defendants-appellants.
L.D. Lockwood for appellants Velasco and Cortez.
San Agustin and Roxas for other appellants.
Ramon Diokno for appellee.
MALCOLM, J.:
This is an action brought by the plaintiff in the Court of First Instance of Manila against the five
defendants, to recover damages in the amount of P10,000, for physical injuries suffered as a result of
an automobile accident. On judgment being rendered as prayed for by the plaintiff, both sets of
defendants appealed.
On February 2, 1930, a passenger truck and an automobile of private ownership collided while
attempting to pass each other on the Talon bridge on the Manila South Road in the municipality of Las
Pias, Province of Rizal. The truck was driven by the chauffeur Abelardo Velasco, and was owned by
Saturnino Cortez. The automobile was being operated by Bonifacio Gutierrez, a lad 18 years of age,
and was owned by Bonifacio's father and mother, Mr. and Mrs. Manuel Gutierrez. At the time of the
collision, the father was not in the car, but the mother, together will several other members of the
Gutierrez family, seven in all, were accommodated therein. A passenger in the autobus, by the name
of Narciso Gutierrez, was en route from San Pablo, Laguna, to Manila. The collision between the bus
and the automobile resulted in Narciso Gutierrez suffering a fracture right leg which required medical
attendance for a considerable period of time, and which even at the date of the trial appears not to
have healed properly.

license to operate motor vehicles made the father responsible for the acts of his son. Based on these
facts, pursuant to the provisions of article 1903 of the Civil Code, the father alone and not the minor or
the mother, would be liable for the damages caused by the minor.
We are dealing with the civil law liability of parties for obligations which arise from fault or negligence.
At the same time, we believe that, as has been done in other cases, we can take cognizance of the
common law rule on the same subject. In the United States, it is uniformly held that the head of a
house, the owner of an automobile, who maintains it for the general use of his family is liable for its
negligent operation by one of his children, whom he designates or permits to run it, where the car is
occupied and being used at the time of the injury for the pleasure of other members of the owner's
family than the child driving it. The theory of the law is that the running of the machine by a child to
carry other members of the family is within the scope of the owner's business, so that he is liable for
the negligence of the child because of the relationship of master and servant. (Huddy On Automobiles,
6th ed., sec. 660; Missell vs. Hayes [1914], 91 Atl., 322.) The liability of Saturnino Cortez, the owner of
the truck, and of his chauffeur Abelardo Velasco rests on a different basis, namely, that of contract
which, we think, has been sufficiently demonstrated by the allegations of the complaint, not
controverted, and the evidence. The reason for this conclusion reaches to the findings of the trial court
concerning the position of the truck on the bridge, the speed in operating the machine, and the lack of
care employed by the chauffeur. While these facts are not as clearly evidenced as are those which
convict the other defendant, we nevertheless hesitate to disregard the points emphasized by the trial
judge. In its broader aspects, the case is one of two drivers approaching a narrow bridge from opposite
directions, with neither being willing to slow up and give the right of way to the other, with the inevitable
result of a collision and an accident.
The defendants Velasco and Cortez further contend that there existed contributory negligence on the
part of the plaintiff, consisting principally of his keeping his foot outside the truck, which occasioned his
injury. In this connection, it is sufficient to state that, aside from the fact that the defense of contributory
negligence was not pleaded, the evidence bearing out this theory of the case is contradictory in the
extreme and leads us far afield into speculative matters.
The last subject for consideration relates to the amount of the award. The appellee suggests that the
amount could justly be raised to P16,517, but naturally is not serious in asking for this sum, since no
appeal was taken by him from the judgment. The other parties unite in challenging the award of
P10,000, as excessive. All facts considered, including actual expenditures and damages for the injury
to the leg of the plaintiff, which may cause him permanent lameness, in connection with other
adjudications of this court, lead us to conclude that a total sum for the plaintiff of P5,000 would be fair
and reasonable. The difficulty in approximating the damages by monetary compensation is well
elucidated by the divergence of opinion among the members of the court, three of whom have inclined
to the view that P3,000 would be amply sufficient, while a fourth member has argued that P7,500
would be none too much.
In consonance with the foregoing rulings, the judgment appealed from will be modified, and the plaintiff
will have judgment in his favor against the defendants Manuel Gutierrez, Abelardo Velasco, and
Saturnino Cortez, jointly and severally, for the sum of P5,000, and the costs of both instances.
Avancea, C.J., Johnson, Street, Villamor, Ostrand, Romualdez, and Imperial, JJ., concur.

It is conceded that the collision was caused by negligence pure and simple. The difference between
the parties is that, while the plaintiff blames both sets of defendants, the owner of the passenger truck
blames the automobile, and the owner of the automobile, in turn, blames the truck. We have given
close attention to these highly debatable points, and having done so, a majority of the court are of the
opinion that the findings of the trial judge on all controversial questions of fact find sufficient support in
the record, and so should be maintained. With this general statement set down, we turn to consider the
respective legal obligations of the defendants.

VILLA-REAL, J.:
I vote for an indemnity of P7,500.

8. Llana vs. Biong


In amplification of so much of the above pronouncement as concerns the Gutierrez family, it may be
explained that the youth Bonifacio was in incompetent chauffeur, that he was driving at an excessive
rate of speed, and that, on approaching the bridge and the truck, he lost his head and so contributed
by his negligence to the accident. The guaranty given by the father at the time the son was granted a

G.R. No. 182356

December 4, 2013

DRA, LEILA A DELA LLANO, Petitioner,


vs.
REBECCA BIONG, doing business under the name and style of Pongkay Trading, Respondent.

Dra. dela Llana, on October 16, 2000, demanded from Rebecca compensation for her injuries, but
Rebecca refused to pay.12

BRION, J.:

Thus, on May 8, 2001, Dra. dela Llana sued Rebecca for damages before the Regional Trial Court of
Quezon City (RTC). She alleged that she lost the mobility of her arm as a result of the vehicular
accident and claimedP150,000.00 for her medical expenses (as of the filing of the complaint) and an
average monthly income ofP30,000.00 since June 2000. She further prayed for actual, moral, and
exemplary damages as well as attorneys fees.13

Very case essentially turns on two basic questions: questions of fact and questions of law. Questions
of fact are the parties and their counsel to respond to, based on what supporting facts the legal
questions require; the court can only draw conclusion from the facts or evidence adduced. When the
facts are lacking because of the deficiency of presented evidence, then the court can only draw one
conclusion: that the cause must fail for lack of evidentiary support.

In defense, Rebecca maintained that Dra. dela Llana had no cause of action against her as no
reasonable relation existed between the vehicular accident and Dra. dela Llanas injury. She pointed
out that Dra. dela Llanas illness became manifest one month and one week from the date of the
vehicular accident. As a counterclaim, she demanded the payment of attorneys fees and costs of the
suit.14

The present case is one such case as Dra. Leila A dela Llanas(petitioner) petition for review on
certorari1challenging the February 11, 2008 Decision2 and the March 31, 2008 resolution3 of the Court
of Appeals (CA) in CA-G.R. CV No. 89163.

At the trial, Dra. dela Llana presented herself as an ordinary witness15 and Joel as a hostile witness.16

DECISION

The Factual Antecedents


On March 30, 2000, at around 11:00 p.m., Juan dela Llana was driving a 1997 Toyota Corolla car
along North Avenue, Quezon City.4
His sister, Dra. dela Llana, was seated at the front passenger seat while a certain Calimlim was at the
backseat.5
Juan stopped the car across the Veterans Memorial Hospital when the signal light turned red. A few
seconds after the car halted, a dump truck containing gravel and sand suddenly rammed the cars rear
end, violently pushing the car forward. Due to the impact, the cars rear end collapsed and its rear
windshield was shattered. Glass splinters flew, puncturing Dra. dela Llana. Apart from these minor
wounds, Dra. dela Llana did not appear to have suffered from any other visible physical injuries.6
The traffic investigation report dated March 30, 2000 identified the truck driver as Joel Primero. It
stated that Joel was recklessly imprudent in driving the truck.7
Joel later revealed that his employer was respondent Rebecca Biong, doing business under the name
and style of "Pongkay Trading" and was engaged in a gravel and sand business.8
In the first week of May 2000, Dra. dela Llana began to feel mild to moderate pain on the left side of
her neck and shoulder. The pain became more intense as days passed by. Her injury became more
severe. Her health deteriorated to the extent that she could no longer move her left arm. On June 9,
2000, she consulted with Dr. Rosalinda Milla, a rehabilitation medicine specialist, to examine her
condition. Dr. Milla told her that she suffered from a whiplash injury, an injury caused by the
compression of the nerve running to her left arm and hand. Dr. Milla required her to undergo physical
therapy to alleviate her condition. Dra. dela Llanas condition did not improve despite three months of
extensive physical therapy.9
She then consulted other doctors, namely, Drs. Willie Lopez, Leonor Cabral-Lim and Eric Flores, in
search for a cure. Dr. Flores, a neuro-surgeon, finally suggested that she undergo a cervical spine
surgery to release the compression of her nerve. On October 19, 2000, Dr. Flores operated on her
spine and neck, between the C5 and the C6 vertebrae.10
The operation released the impingement of the nerve, but incapacitated Dra. dela Llana from the
practice of her profession since June 2000 despite the surgery.11

Dra. dela Llana reiterated that she lost the mobility of her arm because of the vehicular accident. To
prove her claim, she identified and authenticated a medical certificate dated November 20, 2000
issued by Dr. Milla. The medical certificate stated that Dra. dela Llana suffered from a whiplash injury.
It also chronicled her clinical history and physical examinations.17
Meanwhile, Joel testified that his truck hit the car because the trucks brakes got stuck.18
In defense, Rebecca testified that Dra. dela Llana was physically fit and strong when they met several
days after the vehicular accident. She also asserted that she observed the diligence of a good father of
a family in the selection and supervision of Joel. She pointed out that she required Joel to submit a
certification of good moral character as well as barangay, police, and NBI clearances prior to his
employment. She also stressed that she only hired Primero after he successfully passed the driving
skills test conducted by Alberto Marcelo, a licensed driver-mechanic.19
Alberto also took the witness stand. He testified that he checked the truck in the morning of March 30,
2000. He affirmed that the truck was in good condition prior to the vehicular accident. He opined that
the cause of the vehicular accident was a damaged compressor. According to him, the absence of air
inside the tank damaged the compressor.20
RTC Ruling
The RTC ruled in favor of Dra. dela Llana and held that the proximate cause of Dra. dela Llanas
whiplash injury to be Joels reckless driving.21
It found that a whiplash injury is an injury caused by the sudden jerking of the spine in the neck area. It
pointed out that the massive damage the car suffered only meant that the truck was over-speeding. It
maintained that Joel should have driven at a slower pace because road visibility diminishes at night.
He should have blown his horn and warned the car that his brake was stuck and could have prevented
the collision by swerving the truck off the road. It also concluded that Joel was probably sleeping when
the collision occurred as Joel had been driving for fifteen hours on that fateful day. The RTC further
declared that Joels negligence gave rise to the presumption that Rebecca did not exercise the
diligence of a good father of a family in Joel's selection and supervision of Joel. Rebecca was
vicariously liable because she was the employer and she personally chose him to drive the truck. On
the day of the collision, she ordered him to deliver gravel and sand to Muoz Market, Quezon City. The
Court concluded that the three elements necessary to establish Rebeccas liability were present: (1)
that the employee was chosen by the employer, personally or through another; (2) that the services
were to be rendered in accordance with orders which the employer had the authority to give at all
times; and (3) that the illicit act of the employee was on the occasion or by reason of the functions

entrusted to him. The RTC thus awarded Dra. dela Llana the amounts of P570,000.00 as actual
damages, P250,000.00 as moral damages, and the cost of the suit.22
CA Ruling
In a decision dated February 11, 2008, the CA reversed the RTC ruling. It held that Dra. dela Llana
failed to establish a reasonable connection between the vehicular accident and her whiplash injury by
preponderance of evidence. Citing Nutrimix Feeds Corp. v. Court of Appeals,23 it declared that courts
will not hesitate to rule in favor of the other party if there is no evidence or the evidence is too slight to
warrant an inference establishing the fact in issue. It noted that the interval between the date of the
collision and the date when Dra. dela Llana began to suffer the symptoms of her illness was lengthy. It
concluded that this interval raised doubts on whether Joels reckless driving and the resulting collision
in fact caused Dra. dela Llanas injury. It also declared that courts cannot take judicial notice that
vehicular accidents cause whiplash injuries. It observed that Dra. dela Llana did not immediately visit a
hospital to check if she sustained internal injuries after the accident. Moreover, her failure to present
expert witnesses was fatal to her claim. It also gave no weight to the medical certificate. The medical
certificate did not explain how and why the vehicular accident caused the injury.24

The issue before us involves a question of fact and this Court is not a trier of facts. As a general rule,
the CAs findings of fact are final and conclusive and this Court will not review them on appeal. It is not
the function of this Court to examine, review or evaluate the evidence in a petition for review
on certiorari under Rule 45 of the Rules of Court. We can only review the presented evidence, by way
of exception, when the conflict exists in findings of the RTC and the CA. 27
We see this exceptional situation here and thus accordingly examine the relevant evidence presented
before the trial court.
Dra. dela Llana failed to establish her case by preponderance of evidence
Article 2176 of the Civil Code provides that "[w]hoever 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 a quasi-delict." Under this provision,
the elements necessary to establish a quasi-delict case are:
(1) damages to the plaintiff;

The Petition
Dra. dela Llana points out in her petition before this Court that Nutrimix is inapplicable in the present
case. She stresses that Nutrimix involved the application of Article 1561 and 1566 of the Civil Code,
provisions governing hidden defects. Furthermore, there was absolutely no evidence in Nutrimix that
showed that poisonous animal feeds were sold to the respondents in that case. As opposed to the
respondents in Nutrimix, Dra. dela Llana asserts that she has established by preponderance of
evidence that Joels egligent act was the proximate cause of her whiplash injury. First, pictures of her
damaged car show that the collision was strong. She posits that it can be reasonably inferred from
these pictures that the massive impact resulted in her whiplash injury. Second, Dr. Milla categorically
stated in the medical certificate that Dra. dela Llana suffered from whiplash injury. Third, her testimony
that the vehicular accident caused the injury is credible because she was a surgeon.
Dra. dela Llana further asserts that the medical certificate has probative value. Citing several cases,
she posits that an uncorroborated medical certificate is credible if uncontroverted. 25
She points out that expert opinion is unnecessary if the opinion merely relates to matters of common
knowledge. She maintains that a judge is qualified as an expert to determine the causation between
Joels reckless driving and her whiplash injury. Trial judges are aware of the fact that whiplash injuries
are common in vehicular collisions.

(2) negligence, by act or omission, of the defendant or by some person for whose acts the defendant
must respond, was guilty; and
(3) the connection of cause and effect between such negligence and the damages.28
These elements show that the source of obligation in a quasi-delict case is the breach or omission of
mutual duties that civilized society imposes upon its members, or which arise from non-contractual
relations of certain members of society to others.29
Based on these requisites, Dra. dela Llana must first establish by preponderance of evidence the three
elements of quasi-delict before we determine Rebeccas liability as Joels employer.
She should show the chain of causation between Joels reckless driving and her whiplash injury.
Only after she has laid this foundation can the presumption - that Rebecca did not exercise the
diligence of a good father of a family in the selection and supervision of Joel - arise.30

The Respondents Position

Once negligence, the damages and the proximate causation are established, this Court can then
proceed with the application and the interpretation of the fifth paragraph of Article 2180 of the Civil
Code.31

In her Comment,26 Rebecca points out that Dra. dela Llana raises a factual issue which is beyond the
scope of a petition for review on certiorari under Rule 45 of the Rules of Court. She maintains that the
CAs findings of fact are final and conclusive. Moreover, she stresses that Dra. dela Llanas arguments
are not substantial to merit this Courts consideration.

Under Article 2176 of the Civil Code, in relation with the fifth paragraph of Article 2180, "an action
predicated on an employees act or omission may be instituted against the employer who is held liable
for the negligent act or omission committed by his employee."32

The Issue

The rationale for these graduated levels of analyses is that it is essentially the wrongful or negligent act
or omission itself which creates the vinculum juris in extra-contractual obligations.33

The sole issue for our consideration in this case is whether Joels reckless driving is the proximate
cause of Dra. dela Llanas whiplash injury.

In civil cases, a party who alleges a fact has the burden of proving it.

Our Ruling We find the petition unmeritorious.

He who alleges has the burden of proving his allegation by preponderance of evidence or greater
weight of credible evidence.34

The Supreme Court may review questions of fact in a petition for review on certiorari when the findings
of fact by the lower courts are conflicting

The reason for this rule is that bare allegations, unsubstantiated by evidence, are not equivalent to
proof.
In short, mere allegations are not evidence.35
In the present case, the burden of proving the proximate causation between Joels negligence and Dra.
dela Llanas whiplash injury rests on Dra. dela Llana. She must establish by preponderance of
evidence that Joels negligence, in its natural and continuous sequence, unbroken by any efficient
intervening cause, produced her whiplash injury, and without which her whiplash injury would not have
occurred.36

Hearsay evidence, whether objected to or not, cannot be given credence40 except in very unusual
circumstance that is not found in the present case. Furthermore, admissibility of evidence should not
be equated with weight of evidence. The admissibility of evidence depends on its relevance and
competence, while the weight of evidence pertains to evidence already admitted and its tendency to
convince and persuade. Thus, a particular item of evidence may be admissible, but its evidentiary
weight depends on judicial evaluation within the guidelines provided by the Rules of Court.41
During trial, Dra. dela Llana testified:
"Q: Did your physician tell you, more or less, what was the reason why you were feeling that pain in
your left arm?

Notably, Dra. dela Llana anchors her claim mainly on three pieces of evidence:
(1) the pictures of her damaged car,
(2) the medical certificate dated November 20, 2000, and
(3) her testimonial evidence. However, none of these pieces of evidence show the causal relation
between the vehicular accident and the whiplash injury. In other words,

A: Well, I got a certificate from her and in that certificate, she stated that my condition was due to a
compression of the nerve, which supplied my left arm and my left hand.
Court: By the way, what is the name of this physician, Dra.?
Witness: Her name is Dra. Rosalinda Milla. She is a Rehabilitation Medicine Specialist. Atty. Yusingco:
You mentioned that this Dra. Rosalinda Milla made or issued a medical certificate. What relation does
this medical certificate, marked as Exhibit H have to do with that certificate, you said was made by Dra.
Milla?

Dra. dela Llana, during trial, did not adduce the factum probans or the evidentiary facts by which the
factum probandum or the ultimate fact can be established, as fully discussed below.37

Witness: This is the medical certificate that Dra. Milla made out for me.

A.

Atty. Yusingco: Your Honor, this has been marked as Exhibit H.

The pictures of the damaged


car only demonstrate the
impact of the collision

Atty. Yusingco: What other medical services were done on you, Dra. dela Llana, as a result of that
feeling, that pain that you felt in your left arm?

Dra. dela Llana contends that the pictures of the damaged car show that the massive impact of the
collision caused her whiplash injury. We are not persuaded by this bare claim. Her insistence that
these pictures show the causation grossly belies common logic. These pictures indeed demonstrate
the impact of the collision. However, it is a far-fetched assumption that the whiplash injury can also be
inferred from these pictures.

Witness: Well, aside from the medications and physical therapy, a re-evaluation of my condition after
three months indicated that I needed surgery.
Atty. Yusingco: Did you undergo this surgery?
Witness: So, on October 19, I underwent surgery on my neck, on my spine.

B.
Atty. Yusingco: And, what was the result of that surgical operation?
The medical certificate cannot be
considered because it was
not admitted in evidence
Furthermore, the medical certificate, marked as Exhibit "H" during trial, should not be considered in
resolving this case for the reason that it was not admitted in evidence by the RTC in an order dated
September 23, 2004.38
Thus, the CA erred in even considering this documentary evidence in its resolution of the case. It is a
basic rule that evidence which has not been admitted cannot be validly considered by the courts in
arriving at their judgments.
However, even if we consider the medical certificate in the disposition of this case, the medical
certificate has no probative value for being hearsay. It is a basic rule that evidence, whether oral or
documentary, is hearsay if its probative value is not based on the personal knowledge of the witness
but on the knowledge of another person who is not on the witness stand.39

Witness: Well, the operation was to relieve the compression on my nerve, which did not resolve by the
extensive and prolonged physical therapy that I underwent for more than three months."42(emphasis
ours)
Evidently, it was Dr. Milla who had personal knowledge of the contents of the medical certificate.
However, she was not presented to testify in court and was not even able to identify and affirm the
contents of the medical certificate. Furthermore, Rebecca was deprived of the opportunity to crossexamine Dr. Milla on the accuracy and veracity of her findings. We also point out in this respect that
the medical certificate nonetheless did not explain the chain of causation in fact between Joels
reckless driving and Dra. dela Llanas whiplash injury. It did not categorically state that the whiplash
injury was a result of the vehicular accident. A perusal of the medical certificate shows that it only
attested to her medical condition, i.e., that she was suffering from whiplash injury. However, the
medical certificate failed to substantially relate the vehicular accident to Dra. dela Llanas whiplash
injury. Rather, the medical certificate only chronicled

her medical history and physical examinations.


C.
Dra. dela Llanas opinion that
Joels negligence caused her
whiplash injury has no probative value
Interestingly, the present case is peculiar in the sense that Dra. dela Llana, as the plaintiff in this quasidelict case, was the lone physician-witness during trial. Significantly, she merely testified as an
ordinary witness before the trial court. Dra. dela Llana essentially claimed in her testimony that Joels
reckless driving caused her whiplash injury. Despite the fact that Dra. dela Llana is a physician and
even assuming that she is an expert in neurology, we cannot give weight to her opinion that Joels
reckless driving caused her whiplash injury without violating the rules on evidence. Under the Rules of
Court, there is a substantial difference between an ordinary witness and an expert witness. The opinion
of an ordinary witness may be received in evidence regarding:
(a) the identity of a person about whom he has adequate knowledge;
(b) a handwriting with which he has sufficient familiarity; and
(c) the mental sanity of a person with whom he is sufficiently acquainted. Furthermore, the witness may
also testify on his impressions of the emotion, behavior, condition or appearance of a person. 43
On the other hand, the opinion of an expert witness may be received in evidence on a matter requiring
special knowledge, skill, experience or training which he shown to possess.44
However, courts do not immediately accord probative value to an admitted expert testimony, much less
to an unobjected ordinary testimony respecting special knowledge. The reason is that the probative
value of an expert testimony does not lie in a simple exposition of the expert's opinion. Rather, its
weight lies in the assistance that the expert witness may afford the courts by demonstrating the facts
which serve as a basis for his opinion and the reasons on which the logic of his conclusions is
founded.45
In the present case, Dra. dela Llanas medical opinion cannot be given probative value for the reason
that she was not presented as an expert witness. As an ordinary witness, she was not competent to
testify on the nature, and the cause and effects of whiplash injury. Furthermore, we emphasize that
Dra. dela Llana, during trial, nonetheless did not provide a medical explanation on the nature as well as
the cause and effects of whiplash injury in her testimony.
The Supreme Court cannot take
judicial notice that vehicular
accidents cause whiplash injuries.
Indeed, a perusal of the pieces of evidence presented by the parties before the trial court shows
that Dra. Dela Llana did not present any testimonial or documentary evidence that directly
shows the causal relation between the vehicular accident and Dra. Dela Llanas injury. Her claim
that Joels negligence causes her whiplash injury was not established because of the deficiency of the
presented evidence during trial. We point out in this respect that courts cannot take judicial notice that
vehicular ccidents cause whiplash injuries. This proportion is not public knowledge, or is capable of
unquestionable demonstration, or ought to be known to judges because of their judicial functions.46 We
have no expertise in the field of medicine. Justices and judges are only tasked to apply and interpret
the law on the basis of the parties pieces of evidence and their corresponding legal arguments.

In sum, Dra. dela Llana miserably failed to establish her cause by preponderance of evidence. While
we commiserate with her, our solemn duty to independently and impartially assess the merits of the
case binds us to rule against Dra. dela Llanas favor. Her claim, unsupported by prepondernace of
evidence, is merely a bare assertion and has no leg to stand on.
WHEREFORE, presmises considered, the assailed Decision dated February 11, 2008 and Resolution
dated March 31, 2008 of the Court of Appeals are hereby AFFIRMED and the petition is hereby
DENIED for lack of merit.
SO ORDERED.

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