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G.R. No.

85044 June 3, 1992


MACARIO TAMARGO, CELSO TAMARGO and AURELIA TAMARGO, petitioners,
vs.
HON. COURT OF APPEALS, THE HON. ARISTON L. RUBIO, RTC Judge, Branch 20,
Vigan, Ilocos Sur; VICTOR BUNDOC; and CLARA BUNDOC, respondents.
FELICIANO, J.:
On 20 October 1982, Adelberto Bundoc, then a minor of 10 years of age, shot Jennifer Tamargo
with an air rifle causing injuries which resulted in her death. Accordingly, a civil complaint for
damages was filed with the Regional Trial Court, Branch 20, Vigan, Ilocos Sur, docketed as
Civil Case No. 3457-V, by petitioner Macario Tamargo, Jennifer's adopting parent, and
petitioner spouses Celso and Aurelia Tamargo, Jennifer's natural parents against respondent
spouses Victor and Clara Bundoc, Adelberto's natural parents with whom he was living at the
time of the tragic incident. In addition to this case for damages, a criminal information or
Homicide through Reckless Imprudence was filed [Criminal Case No. 1722-V] against
Adelberto Bundoc. Adelberto, however, was acquitted and exempted from criminal liability on
the ground that he bad acted without discernment.
Prior to the incident, or on 10 December 1981, the spouses Sabas and Felisa Rapisura had filed a
petition to adopt the minor Adelberto Bundoc in Special Proceedings No. 0373-T before the then
Court of First Instance of Ilocos Sur. This petition for adoption was grunted on, 18 November
1982, that is, after Adelberto had shot and killed Jennifer.
In their Answer, respondent spouses Bundoc, Adelberto's natural parents, reciting the result of
the foregoing petition for adoption, claimed that not they, but rather the adopting parents,
namely the spouses Sabas and Felisa Rapisura, were indispensable parties to the action since
parental authority had shifted to the adopting parents from the moment the successful petition
for adoption was filed.
Petitioners in their Reply contended that since Adelberto Bundoc was then actually living with
his natural parents, parental authority had not ceased nor been relinquished by the mere filing
and granting of a petition for adoption.
The trial court on 3 December 1987 dismissed petitioners' complaint, ruling that respondent
natural parents of Adelberto indeed were not indispensable parties to the action.
Petitioners received a copy of the trial court's Decision on 7 December 1987. Within the 15-day
reglementary period, or on 14 December 1987, petitioners filed a motion for reconsideration
followed by a supplemental motion for reconsideration on 15 January 1988. It appearing,
however, that the motions failed to comply with Sections 4 and 5 of Rule 15 of the Revised
Rules of Court that notice of the motion shall be given to all parties concerned at least three
(3) days before the hearing of said motion; and that said notice shall state the time and place of
hearing both motions were denied by the trial court in an Order dated 18 April 1988. On 28

April 1988, petitioners filed a notice of appeal. In its Order dated 6 June 1988, the trial court
dismissed the notice at appeal, this time ruling that the notice had been filed beyond the 15-day
reglementary period ending 22 December 1987.
Petitioners went to the Court of Appeals on a petition for mandamus and certiorari questioning
the trial court's Decision dated 3 December 1987 and the Orders dated 18 April 1988 and 6 June
1988, The Court of Appeals dismissed the petition, ruling that petitioners had lost their right to
appeal.
In the present Petition for Review, petitioners once again contend that respondent spouses
Bundoc are the indispensable parties to the action for damages caused by the acts of their minor
child, Adelberto Bundoc. Resolution of this Petition hinges on the following issues: (1) whether
or not petitioners, notwithstanding loss of their right to appeal, may still file the instant Petition;
conversely, whether the Court may still take cognizance of the case even through petitioners'
appeal had been filed out of time; and (2) whether or not the effects of adoption, insofar as
parental authority is concerned may be given retroactive effect so as to make the adopting
parents the indispensable parties in a damage case filed against their adopted child, for acts
committed by the latter, when actual custody was yet lodged with the biological parents.
1. It will be recalled that, petitioners' motion (and supplemental motion) for reconsideration filed
before the trial court, not having complied with the requirements of Section 13, Rule 41, and
Section 4, Rule 15, of the Revised Rules of Court, were considered pro forma and hence did not
interrupt and suspend the reglementary period to appeal: the trial court held that the motions, not
having contained a notice of time and place of hearing, had become useless pieces of paper
which did not interrupt the reglementary period. 1 As in fact repeatedly held by this Court, what
is mandatory is the service of the motion on the opposing counsel indicating the time and place
of hearing. 2
In view, however, of the nature of the issue raised in the instant. Petition, and in order that
substantial justice may be served, the Court, invoking its right to suspend the application of
technical rules to prevent manifest injustice, elects to treat the notice of appeal as having been
seasonably filed before the trial court, and the motion (and supplemental motion) for
reconsideration filed by petitioner in the trial court as having interrupted the reglementary period
for appeal. As the Court held in Gregorio v. Court of Appeals: 3
Dismissal of appeal; purely on technical grounds is frowned upon where the
policy of the courts is to encourage hearings of appeal on their merits. The
rules of procedure ought not be applied in a very rigid technical sense, rules
of procedure are used only to help secure not override, substantial justice. if
d technical and rigid enforcement of the rules is made their aim would be
defeated. 4
2. It is not disputed that Adelberto Bundoc's voluntary act of shooting Jennifer Tamargo with an
air rifle gave rise to a cause of action on quasi-delict against him. As Article 2176 of the Civil
Code provides:

Whoever by act or omission causes damage to another, there being fault or


negligence, is obliged to pay for the damage done. Such fault or negligence,
if there is no pre-existing contractual relation between the parties, is called
a quasi-delict . . .
Upon the other hand, the law imposes civil liability upon the father and, in case of his death or
incapacity, the mother, for any damages that may be caused by a minor child who lives with
them. Article 2180 of the Civil Code reads:
The obligation imposed by article 2176 is demandable not only for one's
own acts or omissions, but also for those of persons for whom one is
responsible.
The father and, in case of his death or incapacity, the mother, are responsible
for the damages caused by the minor children who live in their company.
xxx xxx xxx
The responsibility treated of in this Article shall cease when the person
herein mentioned prove that they observed all the diligence of a good father
of a family to prevent damage. (Emphasis supplied)
This principle of parental liability is a species of what is frequently designated as vicarious
liability, or the doctrine of "imputed negligence" under Anglo-American tort law, where a person
is not only liable for torts committed by himself, but also for torts committed by others with
whom he has a certain relationship and for whom he is responsible. Thus, parental liability is
made a natural or logical consequence of the duties and responsibilities of parents their
parental authority which includes the instructing, controlling and disciplining of the
child. 5 The basis for the doctrine of vicarious liability was explained by the Court in Cangco v.
Manila Railroad Co. 6 in the following terms:
With respect to extra-contractual obligation arising from negligence,
whether of act or omission, it is competent for the legislature to elect and
our Legislature has so elected to limit such liability to cases in which the
person upon whom such an obligation is imposed is morally culpable or, on
the contrary, for reasons of public policy. to extend that liability, without
regard to the lack of moral culpability, so as to include responsibility for the
negligence of those persons whose acts or omissions are imputable, by a
legal fiction, to others who are in a position to exercise an absolute or
limited control over them. The legislature which adopted our Civil Code has
elected to limit extra-contractual liability with certain well-defined
exceptions to cases in which moral culpability can be directly imputed to
the persons to be charged. This moral responsibility may consist in having
failed to exercise due care in one's own acts, or in having failed to exercise
due care in the selection and control of one's agent or servants, or in the

control of persons who, by reasons of their status, occupy a position of


dependency with respect to the person made liable for their
conduct. 7 (Emphasis Supplied)
The civil liability imposed upon parents for the torts of their minor children living
with them, may be seen to be based upon the parental authority vested by the Civil
Code upon such parents. The civil law assumes that when an unemancipated child
living with its parents commits a tortious acts, the parents were negligent in the
performance of their legal and natural duty closely to supervise the child who is in
their custody and control. Parental liability is, in other words, anchored upon parental
authority coupled with presumed parental dereliction in the discharge of the duties
accompanying such authority. The parental dereliction is, of course, only presumed
and the presumption can be overtuned under Article 2180 of the Civil Code by proof
that the parents had exercised all the diligence of a good father of a family to prevent
the damage.
In the instant case, the shooting of Jennifer by Adelberto with an air rifle occured when parental
authority was still lodged in respondent Bundoc spouses, the natural parents of the minor
Adelberto. It would thus follow that the natural parents who had then actual custody of the
minor Adelberto, are the indispensable parties to the suit for damages.
The natural parents of Adelberto, however, stoutly maintain that because a decree of adoption
was issued by the adoption court in favor of the Rapisura spouses, parental authority was vested
in the latter as adopting parents as of the time of the filing of the petition for adoption that
is, before Adelberto had shot Jennifer which an air rifle. The Bundoc spouses contend that they
were therefore free of any parental responsibility for Adelberto's allegedly tortious conduct.
Respondent Bundoc spouses rely on Article 36 of the Child and Youth Welfare Code 8 which
reads as follows:
Art. 36. Decree of Adoption. If, after considering the report of the
Department of Social Welfare or duly licensed child placement agency and
the evidence submitted before it, the court is satisfied that the petitioner is
qualified to maintain, care for, and educate the child, that the trial custody
period has been completed, and that the best interests of the child will be
promoted by the adoption, a decree of adoption shall be entered, which shall
be effective he date the original petition was filed. The decree shall state the
name by which the child is thenceforth to be known. (Emphasis supplied)
The Bundoc spouses further argue that the above Article 36 should be read in relation
to Article 39 of the same Code:
Art. 39. Effect of Adoption. The adoption shall:
xxx xxx xxx

(2) Dissolve the authority vested in the natural parents, except where the
adopter is the spouse of the surviving natural parent;

Article 35 of the Child and Youth Welfare Code fortifies the conclusion reached above. Article
35 provides as follows:

xxx xxx xxx

Art. 35. Trial Custody. No petition for adoption shall be finally granted
unless and until the adopting parents are given by the courts a supervised
trial custody period of at least six months to assess their adjustment and
emotional readiness for the legal union. During the period of trial custody,
parental authority shall be vested in the adopting parents. (Emphasis
supplied)

(Emphasis supplied)
and urge that their Parental authority must be deemed to have been dissolved as of the time the
Petition for adoption was filed.
The Court is not persuaded. As earlier noted, under the Civil Code, the basis of parental liability
for the torts of a minor child is the relationship existing between the parents and the minor child
living with them and over whom, the law presumes, the parents exercise supervision and control.
Article 58 of the Child and Youth Welfare Code, re-enacted this rule:
Article 58 Torts Parents and guardians are responsible for the damage
caused by the child under their parental authority in accordance with the
civil Code. (Emphasis supplied)
Article 221 of the Family Code of the Philippines 9 has similarly insisted upon the requisite that
the child, doer of the tortious act, shall have beer in the actual custody of the parents sought to
be held liable for the ensuing damage:
Art. 221. Parents and other persons exercising parental authority shall be
civilly liable for the injuries and damages caused by the acts or omissions of
their unemancipated children living in their companyand under their parental
authority subject to the appropriate defenses provided by law. (Emphasis
supplied)
We do not believe that parental authority is properly regarded as having been retroactively
transferred to and vested in the adopting parents, the Rapisura spouses, at the time the air rifle
shooting happened. We do not consider that retroactive effect may be giver to the decree of
adoption so as to impose a liability upon the adopting parents accruing at a time when adopting
parents had no actual or physically custody over the adopted child. Retroactive affect may
perhaps be given to the granting of the petition for adoption where such is essential to permit the
accrual of some benefit or advantage in favor of the adopted child. In the instant case, however,
to hold that parental authority had been retroactively lodged in the Rapisura spouses so as to
burden them with liability for a tortious act that they could not have foreseen and which they
could not have prevented (since they were at the time in the United States and had no physical
custody over the child Adelberto) would be unfair and unconscionable. Such a result, moreover,
would be inconsistent with the philosophical and policy basis underlying the doctrine of
vicarious liability. Put a little differently, no presumption of parental dereliction on the part of
the adopting parents, the Rapisura spouses, could have arisen since Adelberto was not in fact
subject to their control at the time the tort was committed.

Under the above Article 35, parental authority is provisionally vested in the adopting parents
during the period of trial custody, i.e., before the issuance of a decree of adoption, precisely
because the adopting parents are given actual custody of the child during such trial period. In
the instant case, the trial custody period either had not yet begun or bad already been completed
at the time of the air rifle shooting; in any case, actual custody of Adelberto was then with his
natural parents, not the adopting parents.
Accordingly, we conclude that respondent Bundoc spouses, Adelberto's natural parents, were
indispensable parties to the suit for damages brought by petitioners, and that the dismissal by the
trial court of petitioners' complaint, the indispensable parties being already before the court,
constituted grave abuse of discretion amounting to lack or excess of jurisdiction.
WHEREFORE, premises considered, the Petition for Review is hereby GRANTED DUE
COURSE and the Decision of the Court of Appeals dated 6 September 1988, in C.A.-G.R. No.
SP-15016 is hereby REVERSED and SET ASIDE. Petitioners' complaint filed before the trial
court is hereby REINSTATED and this case is REMANDED to that court for further
proceedings consistent with this Decision. Costs against respondent Bundoc spouses. This
Decision is immediately executory.
SO ORDERED.
[G.R. No. 70890. September 18, 1992.]
CRESENCIO LIBI * and AMELIA YAP LIBI, Petitioners, v. HON. INTERMEDIATE
APPELLATE COURT, FELIPE GOTIONG and SHIRLEY GOTIONG, Respondents.
Alex Y. Tan, for Petitioners.
Mario D. Ortiz and Danilo V. Ortiz for Private Respondents.
SYLLABUS
1. CIVIL LAW; QUASI DELICT; LIABILITY OF PARENTS FOR CIVIL LIABILITY
ARISING FROM CRIMINAL OFFENSES COMMITTED BY THEIR MINOR CHILDREN;
RULE. The parents are and should be held primarily liable for the civil liability arising from

criminal offenses committed by their minor children under their legal authority or control, or
who live in their company, unless it is proven that the former acted with the diligence of a good
father of a family to prevent such damages. That primary liability is premised on the provisions
of Article 101 of the Revised Penal Code with respect to damages ex delicto caused by their
children 9 years of age or under, or over 9 but under 15 years of age who acted without
discernment; and, with regard to their children over 9 but under 15 years of age who acted with
discernment, or 15 years or over but under 21 years of age, such primary liability shall be
imposed pursuant to Article 2180 of the Civil Code. Under said Article 2180, the enforcement of
such liability shall be effected against the father and, in case of his death or incapacity, the
mother. This was amplified by the Child and Youth Welfare Code which provides that the same
shall devolve upon the father and, in case of his death or incapacity, upon the mother or, in case
of her death or incapacity, upon the guardian, but the liability may also be voluntarily assumed
by a relative or family friend of the youthful offender. However, under the Family Code, this
civil liability is now, without such alternative qualification, the responsibility of the parents and
those who exercise parental authority over the minor offender. For civil liability arising from
quasi-delicts committed by minors, the same rules shall apply in accordance with Articles 2180
and 2182 of the Civil Code, as so modified.
DECISION
REGALADO, J.:
One of the ironic verities of life, it has been said, is that sorrow is sometimes a touchstone of
love. A tragic illustration is provided by the instant case, wherein two lovers died while still in
the prime of their years, a bitter episode for those whose lives they have touched. While we
cannot expect to award complete assuagement to their families through seemingly prosaic legal
verbiage, this disposition should at least terminate the acrimony and rancor of an extended
judicial contest resulting from the unfortunate occurrence.
In this final denouement of the judicial recourse the stages whereof were alternately initiated by
the parties, petitioners are now before us seeking the reversal of the judgment of respondent
court promulgated on January 2, 1985 in AC-G.R. CV No. 69060 with the following decretal
portion:jgc:chanrobles.com.ph
"WHEREFORE, the decision of the lower court dismissing plaintiffs complaint is hereby
reversed; and instead, judgment is hereby rendered sentencing defendants, jointly and solidarily,
to pay to plaintiffs the following amounts:chanrobles.com : virtual law library
1. Moral damages, P30,000.000;
2. Exemplary damages, P10,000.00;

Libi, then a minor between 18 and 19 years of age living with his aforesaid parents, and who
also died in the same event on the same date.
For more than two (2) years before their deaths, Julie Ann Gotiong and Wendell Libi were
sweethearts until December, 1978 when Julie Ann broke up her relationship with Wendell after
she supposedly found him to be sadistic and irresponsible. During the first and second weeks of
January, 1979, Wendell kept pestering Julie Ann with demands for reconciliation but the latter
persisted in her refusal, prompting the former to resort to threats against her. In order to avoid
him, Julie Ann stayed in the house of her best friend, Malou Alfonso, at the corner of Maria
Cristina and Juana Osmea Streets, Cebu City, from January 7 to 13, 1978.
On January 14, 1979, Julie Ann and Wendell died, each from a single gunshot wound inflicted
with the same firearm, a Smith and Wesson revolver licensed in the name of petitioner Cresencio
Libi, which was recovered from the scene of the crime inside the residence of private
respondents at the corner of General Maxilom and D. Jakosalem streets of the same city.
Due to the absence of an eyewitness account of the circumstances surrounding the death of both
minors, their parents, who are the contending parties herein, posited their respective theories
drawn from their interpretation of circumstantial evidence, available reports, documents and
evidence of physical facts.
Private respondents, bereaved over the death of their daughter, submitted that Wendell caused
her death by shooting her with the aforesaid firearm and, thereafter, turning the gun on himself
to commit suicide. On the other hand, Petitioners, puzzled and likewise distressed over the death
of their son, rejected the imputation and contended that an unknown third party, whom Wendell
may have displeased or antagonized by reason of his work as a narcotics informer of the
Constabulary Anti-Narcotics Unit (CANU), must have caused Wendells death and then shot
Julie Ann to eliminate any witness and thereby avoid identification.chanrobles.com:cralaw:red
As a result of the tragedy, the parents of Julie Ann filed Civil Case No. R-17774 in the then
Court of First Instance of Cebu against the parents of Wendell to recover damages arising from
the latters vicarious liability under Article 2180 of the Civil Code. After trial, the court below
rendered judgment on October 20, 1980 as follows:jgc:chanrobles.com.ph
"WHEREFORE, premises duly considered, judgment is hereby rendered dismissing plaintiffs
complaint for insufficiency of the evidence. Defendants counterclaim is likewise denied for lack
of sufficient merit." 2
On appeal to respondent court, said judgment of the lower court dismissing the complaint of
therein plaintiffs-appellants was set aside and another judgment was rendered against
defendants-appellees who, as petitioners in the present appeal by certiorari, now submit for
resolution the following issues in this case:chanrob1es virtual 1aw library
1. Whether or not respondent court correctly reversed the trial court in accordance with
established decisional laws; and

3. Attorneys fees, P20,000.00, and costs.


However, denial of defendants-appellees counterclaims is affirmed." 1

2. Whether or not Article 2180 of the Civil Code was correctly interpreted by respondent court
to make petitioners liable for vicarious liability. 3

Synthesized from the findings of the lower courts, it appears that respondent spouses are the
legitimate parents of Julie Ann Gotiong who, at the time of the deplorable incident which took
place and from which she died on January 14, 1979, was an 18-year old first year commerce
student of the University of San Carlos, Cebu City; while petitioners are the parents of Wendell

In the proceedings before the trial court, Dr. Jesus P. Cerna, Police Medico-Legal Officer of
Cebu, submitted his findings and opinions on some postulates for determining whether or not the
gunshot wound was inflicted on Wendell Libi by his own suicidal act. However, undue emphasis
was placed by the lower court on the absence of gunpowder or tattooing around the wound at the

point of entry of the bullet. It should be emphasized, however, that this is not the only
circumstance to be taken into account in the determination of whether it was suicide or not.
It is true that said witness declared that he found no evidence of contact or close-contact of an
explosive discharge in the entrance wound. However, as pointed out by private respondents, the
body of deceased Wendell Libi must have been washed at the funeral parlor, considering the
hasty interment thereof a little after eight (8) hours from the occurrence wherein he died. Dr.
Cerna himself could not categorically state that the body of Wendell Libi was left untouched at
the funeral parlor before he was able to conduct his autopsy. It will also be noted that Dr. Cerna
was negligent in not conducting a paraffin test on Wendell Libi, hence possible evidence of
gunpowder residue on Wendells hands was forever lost when Wendell was hastily
buried.cralawnad
More specifically, Dr. Cerna testified that he conducted an autopsy on the body of Wendell Libi
about eight (8) hours after the incident or, to be exact, eight (8) hours and twenty (20) minutes
based on the record of death; that when he arrived at the Cosmopolitan Funeral Homes, the body
of the deceased was already on the autopsy table and in the stage of rigor mortis; and that said
body was not washed, but it was dried. 4 However, on redirect examination, he admitted that
during the 8-hour interval, he never saw the body nor did he see whether said body was wiped or
washed in the area of the wound on the head which he examined because the deceased was
inside the morgue. 5 In fact, on cross-examination, he had earlier admitted that as far as the
entrance of the wound, the trajectory of the bullet and the exit of the wound are concerned, it is
possible that Wendell Libi shot himself. 6
He further testified that the muzzle of the gun was not pressed on the head of the victim and that
he found no burning or singeing of the hair or extensive laceration on the gunshot wound of
entrance which are general characteristics of contact or near-contact fire. On direct examination,
Dr. Cerna nonetheless made these clarification:jgc:chanrobles.com.ph

the sketch prepared by the Medico-Legal Division of the National Bureau of Investigation, 9
shows that there is only one gunshot wound of entrance located at the right temple of Wendell
Libi. The necropsy report prepared by Dr. Cerna states:chanrob1es virtual 1aw library
x
x
x
"Gunshot wound, ENTRANCE, ovaloid, 0.5 x 0.4 cm., with contusion collar widest inferiorly
by 0.2 cm., edges inverted, oriented upward, located at the head, temporal region, right, 2.8 cms.
behind and 5.5 cms. above right external auditory meatus, directed slightly forward, upward and
to the left, involving skin and soft tissues, making a punch-in fracture on the temporal bone,
right, penetrating cranial cavity, lacerating extensively along its course the brain tissues,
fracturing parietal bone, left, and finally making an EXIT wound, irregular, 2.0 x 1.8 cms., edges
(e)verted, parietal region, left, 2.0 cms. behind and 12.9 cms. above left external auditory
meatus.chanrobles virtualawlibrary chanrobles.com:chanrobles.com.ph
x
x
x
"Evidence of contact or close-contact fire, such as burning around the gunshot wound of
entrance, gunpowder tatooing (sic), smudging, singeing of hair, extensive laceration or bursting
of the gunshot wound of entrance, or separation of the skin from the underlying tissue, are
absent." 10
On cross-examination, Dr. Cerna demonstrated his theory which was made of record,
thus:jgc:chanrobles.com.ph
"Q Now, will you please use yourself as Wendell Libi, and following the entrance of the wound,
the trajectory of the bullet and the exit of the wound, and measuring yourself 24 inches, will you
please indicate to the Honorable Court how would it have been possible for Wendell Libi to kill
himself? Will you please indicate the 24 inches?

"Q Is it not a fact that there are certain guns which are so made that there would be no black
residue or tattooing that could result from these guns because they are what we call clean?

WITNESS:chanrob1es virtual 1aw library

A Yes, sir. I know that there are what we call smokeless powder.

A Actually, sir, the 24 inches is approximately one arms length.

ATTY. ORTIZ:chanrob1es virtual 1aw library

ATTY. SENINING:chanrob1es virtual 1aw library

Q Yes. So, in cases, therefore, of guns where the powder is smokeless, those indications that you
said may not rule out the possibility that the gun was closer than 24 inches, is that correct?

I would like to make of record that the witness has demonstrated by extending his right arm
almost straight towards his head." 11

A If the . . . assuming that the gun used was .. the bullet used was a smokeless powder.

Private respondents assail the fact that the trial court gave credence to the testimonies of
defendants witnesses Lydia Ang and James Enrique Tan, the first being a resident of an
apartment across the street from the Gotiongs and the second, a resident of the house adjacent to
the Gotiong residence, who declared having seen a "shadow" of a person at the gate of the
Gotiong house after hearing shots therefrom.

Q At any rate, doctor, from . . . disregarding those other matters that you have noticed, the
singeing, etc., from the trajectory, based on the trajectory of the bullet as shown in your own
sketch, is it not a fact that the gun could have been fired by the person himself, the victim
himself, Wendell Libi, because it shows a point of entry a little above the right ear and point of
exit a little above that, to be very fair and on your oath?
A As far as the point of entrance is concerned and as far as the trajectory of the bullet is
concerned and as far as the angle or the manner of fire is concerned, it could have been fired by
the victim." 7
As shown by the evidence, there were only two used bullets 8 found at the scene of the crime,
each of which were the bullets that hit Julie Ann Gotiong and Wendell Libi, respectively. Also,

On cross-examination, Lydia Ang testified that the apartment where she was staying faces the
gas station; that it is the second apartment; that from her window she can see directly the gate of
the Gotiongs and, that there is a firewall between her apartment and the gas station. 12 After
seeing a man jump from the gate of the Gotiongs to the rooftop of the Tans, she called the police
station but the telephone lines were busy. Later on, she talked with James Enrique Tan and told
him that she saw a man leap from the gate towards his rooftop. 13

However, James Enrique Tan testified that he saw a "shadow" on top of the gate of the Gotiongs,
but denied having talked with anyone regarding what he saw. He explained that he lives in a
duplex house with a garden in front of it; that his house is next to Felipe Gotiongs house; and he
further gave the following answers to these questions:chanrobles.com : virtual law library
"ATTY. ORTIZ: (TO WITNESS).
Q What is the height of the wall of the Gotiongs in relation to your house?
WITNESS:chanrob1es virtual 1aw library
A It is about 8 feet.
ATTY. ORTIZ: (TO WITNESS)
Q And where were you looking from?
WITNESS:chanrob1es virtual 1aw library
A From upstairs in my living room.
ATTY. ORTIZ (TO WITNESS)
Q From Your living room window, is that correct?
WITNESS:chanrob1es virtual 1aw library
A Yes, but not very clear because the wall is high." 14
Analyzing the foregoing testimonies, we agree with respondent court that the same do not
inspire credence as to the reliability and accuracy of the witnesses observations, since the visual
perceptions of both were obstructed by high walls in their respective houses in relation to the
house of herein private respondents. On the other hand, witness Manolo Alfonso, testifying on
rebuttal, attested without contradiction that he and his sister, Malou Alfonso, were waiting for
Julie Ann Gotiong when they heard her scream; that when Manolo climbed the fence to see what
was going on inside the Gotiong house, he heard the first shot; and, not more than five (5)
seconds later, he heard another shot. Consequently, he went down from the fence and drove to
the police station to report the incident. 15 Manolos direct and candid testimony establishes and
explains the fact that it was he whom Lydia Ang and James Enrique Tan saw as the "shadow" of
a man at the gate of the Gotiong house.
We have perforce to reject petitioners effete and unsubstantiated pretension that it was another
man who shot Wendell and Julie Ann. It is significant that the Libi family did not even point to
or present any suspect in the crime nor did they file any case against any alleged "John Doe."
Nor can we sustain the trial courts dubious theory that Wendell Libi did not die by his own hand
because of the overwhelming evidence testimonial, documentary and pictorial the
confluence of which point to Wendell as the assailant of Julie Ann, his motive being revenge for
her rejection of his persistent pleas for a reconciliation.chanrobles.com:cralaw:red
Petitioners defense that they had exercised the due diligence of a good father of a family, hence
they should not be civilly liable for the crime committed by their minor son, is not borne out by
the evidence on record either.

Petitioner Amelita Yap Libi, mother of Wendell, testified that her husband, Cresencio Libi, owns
a gun which he kept in a safety deposit box inside a drawer in their bedroom. Each of these
petitioners holds a key to the safety deposit box and Amelitas key is always in her bag, all of
which facts were known to Wendell. They have never seen their son Wendell taking or using the
gun. She admitted, however, that on that fateful night the gun was no longer in the safety deposit
box. 16 We, accordingly, cannot but entertain serious doubts that petitioner spouses had really
been exercising the diligence of a good father of a family by safely locking the fatal gun away.
Wendell could not have gotten hold thereof unless one of the keys to the safety deposit box was
negligently left lying around or he had free access to the bag of his mother where the other key
was.
The diligence of a good father of a family required by law in a parent and child relationship
consists, to a large extent, of the instruction and supervision of the child. Petitioners were
gravely remiss in their duties as parents in not diligently supervising the activities of their son,
despite his minority and immaturity, so much so that it was only at the time of Wendells death
that they allegedly discovered that he was a CANU agent and that Cresencios gun was missing
from the safety deposit box. Both parents were sadly wanting in their duty and responsibility in
monitoring and knowing the activities of their children who, for all they know, may be engaged
in dangerous work such as being drug informers, 17 or even drug users. Neither was a plausible
explanation given for the photograph of Wendell, with a handwritten dedication to Julie Ann at
the back thereof, 18 holding upright what clearly appears as a revolver and on how or why he
was in possession of that firearm.
In setting aside the judgment of the court a quo and holding petitioners civilly liable, as
explained at the start of this opinion, respondent court waved aside the protestations of diligence
on the part of petitioners and had this to say:jgc:chanrobles.com.ph
". . . It is still the duty of parents to know the activity of their children who may be engaged in
this dangerous activity involving the menace of drugs. Had the defendants-appellees been
diligent in supervising the activities of their son, Wendell, and in keeping said gun from his
reach, they could have prevented Wendell from killing Julie Ann Gotiong. Therefore, appellants
are liable under Article 2180 of the Civil Code which provides:chanrob1es virtual 1aw library
The father, and in case of his death or incapacity, the mother, are responsible for the damages
caused by their minor children who live in their company.
"Having been grossly negligent in preventing Wendell Libi from having access to said gun
which was allegedly kept in a safety deposit box, defendants-appellees are subsidiarily liable for
the natural consequence of the criminal act of said minor who was living in their company. This
vicarious liability of herein defendants-appellees has been reiterated by the Supreme Court in
many cases, prominent of which is the case of Fuellas v. Cadano, et. al. (L-14409, Oct. 31, 1961,
3 SCRA 361-367), which held that:chanrob1es virtual 1aw library
The subsidiary liability of parents for damages caused by their minor children imposed by
Article 2180 of the New Civil Code covers obligations arising from both quasi-delicts and
criminal offenses.
The subsidiary liability of parents arising from the criminal acts of their minor children who
acted with discernment is determined under the provisions of Article 2180, N.C.C. and under
Article 101 of the Revised Penal Code, because to hold that the former only covers obligations
which arise from quasi-delicts and not obligations which arise from criminal offenses, would
result in the absurdity that while for an act where mere negligence intervenes the father or

mother may stand subsidiarily liable for the damages caused by his or her son, no liability would
attach if the damage is caused with criminal intent. (3 SCRA 361-362).

they observed all the diligence of a good father of a family to prevent damages."cralaw
virtua1aw library

". . . In the instant case, minor son of herein defendants-appellees, Wendell Libi somehow got
hold of the key to the drawer where said gun was kept under lock without defendant-spouses
ever knowing that said gun had been missing from that safety box since 1978 when Wendell Libi
had) a picture taken wherein he proudly displayed said gun and dedicated this picture to his
sweetheart, Julie Ann Gotiong; also since then, Wendell Libi was said to have kept said gun in
his car, in keeping up with his supposed role of a CANU agent . . ." chanrobles lawlibrary :
rednad
x
x
x

We are also persuaded that the liability of the parents for felonies committed by their minor
children is likewise primary, not subsidiary. Article 101 of the Revised Penal Code
provides:jgc:chanrobles.com.ph

"Based on the foregoing discussions of the assigned errors, this Court holds that the lower court
was not correct in dismissing herein plaintiffs-appellants complaint because as preponderantly
shown by evidence, defendants-appellees utterly failed to exercise all the diligence of a good
father of the family in preventing their minor son from committing this crime by means of the
gun of defendants-appellees which was freely accessible to Wendell Libi for they have not
regularly checked whether said gun was still under lock, but learned that it was missing from the
safety deposit box only after the crime had been committed." (Emphases ours.) 19
We agree with the conclusion of respondent court that petitioners should be held liable for the
civil liability based on what appears from all indications was a crime committed by their minor
son. We take this opportunity, however, to digress and discuss its ratiocination therefor on
jurisprudential dicta which we feel require clarification.
In imposing sanctions for the so-called vicarious liability of petitioners, respondent court cites
Fuellas v. Cadano, Et. Al. 20 which supposedly holds that" (t)he subsidiary liability of parents
for damages caused by their minor children imposed by Article 2180 of the New Civil Code
covers obligations arising from both quasi-delicts and criminal offenses," followed by an
extended quotation ostensibly from the same case explaining why under Article 2180 of the
Civil Code and Article 101 of the Revised Penal Code parents should assume subsidiary liability
for damages caused by their minor children. The quoted passages are set out two paragraphs
back, with pertinent underscoring for purposes of the discussion hereunder.chanrobles law
library
Now, we do not have any objection to the doctrinal rule holding, the parents liable, but the
categorization of their liability as being subsidiary, and not primary, in nature requires a hard
second look considering previous decisions of this court on the matter which warrant
comparative analyses. Our concern stems from our readings that if the liability of the parents for
crimes or quasi-delicts of their minor children is subsidiary, then the parents can neither invoke
nor be absolved of civil liability on the defense that they acted with the diligence of a good
father of a family to prevent damages. On the other hand, if such liability imputed to the parents
is considered direct and primary, that diligence would constitute a valid and substantial defense.
We believe that the civil liability of parents for quasi-delicts of their minor children, as
contemplated in Article 2180 of the Civil Code, is primary and not subsidiary. In fact, if we
apply Article 2194 of said code which provides for solidary liability of joint tortfeasors, the
persons responsible for the act or omission, in this case the minor and the father and, in case of
his death of incapacity, the mother, are solidarily liable. Accordingly, such parental liability is
primary and not subsidiary, hence the last paragraph of Article 2180 provides that" (t)he
responsibility treated of in this article shall cease when the persons herein mentioned prove that

"ARTICLE 101. Rules regarding civil liability in certain cases.


x
x
x
First. In cases of subdivisions . . . 2, and 3 of Article 12, the civil liability for acts committed 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."
(Emphasis supplied.) 21
Accordingly, just like the rule in Article 2180 of the Civil Code, under the foregoing provision
the civil liability of the parents for crimes committed by their minor children is likewise direct
and primary, and also subject to the defense of lack of fault or negligence on their part, that is,
the exercise of the diligence of a good father of a family.
That in both quasi-delicts and crimes the parents primarily respond for such damages is
buttressed by the corresponding provisions in both codes that the minor transgressor shall be
answerable or shall respond with his own property only in the absence or in case of insolvency
of the former. Thus, for civil liability ex quasi delicto of minors, Article 2182 of the Civil Code
states that" (i)f the minor causing damage has no parents or guardian, the minor . . . shall be
answerable with his own property in an action against him where a guardian ad litem shall be
appointed." For civil liability ex delicto of minors, an equivalent provision is found in the third
paragraph of Article 101 of the Revised Penal Code, to wit:jgc:chanrobles.com.ph
"Should there be no person having such . . . minor under his authority, legal guardianship or
control, or if such person be insolvent, said . . . minor shall respond with (his) own property,
excepting property exempt from execution, in accordance with civil law."cralaw virtua1aw
library
The civil liability of parents for felonies committed by their minor children contemplated in the
aforesaid rule in Article 101 of the Revised Penal Code in relation to Article 2180 of the Civil
Code has, aside from the aforecited case of Fuellas, been the subject of a number of cases
adjudicated by this Court, viz.: Exconde v. Capuno, Et Al., 22 Araneta v. Arreglado, 23 Salen,
Et. Al. v. Balce, 24 Paleyan, etc., Et. Al. v. Bangkili, Et Al., 25 and Elcano, et al, v. Hill, Et. Al.
26 Parenthetically, the aforesaid cases were basically on the issue of the civil liability of parents
for crimes committed by their minor children over 9 but under 15 years of age, who acted with
discernment, and also of minors 15 years of aye or over, since these situations are not covered
by Article 101, Revised Penal Code. In both instances, this Court held that the issue of parental
civil liability should be resolved in accordance with the provisions of Article 2180 of the Civil
Code for the reasons well expressed in Salen and adopted in the cases hereinbefore enumerated
that to hold that the civil liability under Article 2180 would apply only to quasi-delicts and not to
criminal offenses would result in the absurdity that in an act involving mere negligence the
parents would be liable but not where the damage is caused with criminal intent. In said cases,
however, there are unfortunate variances resulting in a regrettable inconsistency in the Courts
determination of whether the liability of the parents, in cases involving either crimes or quasidelicts of their minor children, is primary or subsidiary.

In Exconde, where the 15-year old minor was convicted of double homicide through reckless
imprudence, in a separate civil action arising from the crime the minor and his father were held
jointly and severally liable for failure of the latter to prove the diligence of a good father of a
family. The same liability in solidum and, therefore, primary liability was imposed in a separate
civil action in Araneta on the parents and their 14-year old son who was found guilty of
frustrated homicide, but on the authority of Article 2194 of the Civil Code providing for solidary
responsibility of two or more persons who are liable for a quasi-delict.
However, in Salen, the father was declared subsidiarily liable for damages arising from the
conviction of his son, who was over 15 but less than 18 years of age, by applying Article 2180
but, this time, disregarding Article 2194 of the Civil Code. In the present case, as already
explained, the petitioners herein were also held liable but supposedly in line with Fuellas which
purportedly declared the parents subsidiarily liable for the civil liability for serious physical
injuries committed by their 13-year old son. On the other hand, in Paleyan, the mother and her
19-year old son were adjudged solidarily liable for damages arising from his conviction for
homicide by the application of Article 2180 of the Civil Code since this is likewise not covered
by Article 101 of the Revised Penal Code. Finally, in Elcano, although the son was acquitted in a
homicide charge due to "lack of intent, coupled with mistake," it was ruled that while under
Article 2180 of the Civil Code there should be solidary liability for damages, since the son,
"although married, was living with his father and getting subsistence from him at the time of the
occurrence," but "is now of age, as a matter of equity" the father was only held subsidiarily
liable.
It bears stressing, however, that the Revised Penal Code provides for subsidiary liability only for
persons causing damages under the compulsion of irresistible force or under the impulse of an
uncontrollable fear; 27 innkeepers, tavernkeepers and proprietors of establishments; 28
employers, teachers, persons and corporations engaged in industry; 29 and principals,
accomplices and accessories for the unpaid civil liability of their co-accused in the other classes.
30
Also, coming back to respondent courts reliance on Fuellas in its decision in the present case, it
is not exactly accurate to say that Fuellas provided for subsidiary liability of the parents therein.
A careful scrutiny shows that what respondent court quoted verbatim in its decision now on
appeal in the present case, and which it attributed to Fuellas, was the syllabus on the law report
of said case which spoke of "subsidiary" liability. However, such categorization does not
specifically appear in the text of the decision in Fuellas. In fact, after reviewing therein the cases
of Exconde, Araneta and Salen and the discussions in said cases of Article 101 of the Revised
Penal Code in relation to Article 2180 of the Civil Code, this Court concluded its decision in this
wise:jgc:chanrobles.com.ph
"Moreover, the case at bar was decided by the Court of Appeals on the basis of evidence
submitted therein by both parties, independent of the criminal case. And responsibility for fault
or negligence under Article 2176 upon which the present action was instituted, is entirely
separate and distinct from the civil liability arising from fault or negligence under the Penal
Code (Art. 2177), and having in mind the reasons behind the law as heretofore stated, any
discussion as to the minors criminal responsibility is of no moment."cralaw virtua1aw library
Under the foregoing considerations, therefore, we hereby rule that the parents are and should be
held primarily liable for the civil liability arising from criminal offenses committed by their
minor children under their legal authority or control, or who live in their company, unless it is
proven that the former acted with the diligence of a good father of a family to prevent such
damages. That primary liability is premised on the provisions of Article 101 of the Revised

Penal Code with respect to damages ex delicto caused by their children 9 years of age or under,
or over 9 but under 15 years of age who acted without discernment; and, with regard to their
children over 9 but under 15 years of age who acted with discernment, or 15 years or over but
under 21 years of age, such primary liability shall be imposed pursuant to Article 2180 of the
Civil Code. 31
Under said Article 2180, the enforcement of such liability shall be effected against the father
and, in case of his death or incapacity, the mother. This was amplified by the Child and Youth
Welfare Code which provides that the same shall devolve upon the father and, in case of his
death or incapacity, upon the mother or, in case of her death or incapacity, upon the guardian, but
the liability may also be voluntarily assumed by a relative or family friend of the youthful
offender. 32 However, under the Family Code, this civil liability is now, without such alternative
qualification, the responsibility of the parents and those who exercise parental authority over the
minor offender. 33 For civil liability arising from quasi-delicts committed by minors, the same
rules shall apply in accordance with Articles 2180 and 2182 of the Civil Code, as so modified.
In the case at bar, whether the death of the hapless Julie Ann Gotiong was caused by a felony or
a quasi-delict committed by Wendell Libi, respondent court did not err in holding petitioners
liable for damages arising therefrom. Subject to the preceding modifications of the premises
relied upon by it therefor and on the bases of the legal imperatives herein explained, we conjoin
in its findings that said petitioners failed to duly exercise the requisite diligentissimi patris
familias to prevent such damages.
ACCORDINGLY, the instant Petition is DENIED and the assailed judgment of respondent Court
of Appeals is hereby AFFIRMED, with costs against petitioners.
SPS. BUENAVENTURA JAYME G.R. No. 163609
AND ROSARIO JAYME,
Petitioners,
Present:
- versus - YNARES-SANTIAGO, J.,
Chairperson,
AUSTRIA-MARTINEZ,
RODRIGO APOSTOL, FIDEL CHICO-NAZARIO,
LOZANO, ERNESTO SIMBULAN, NACHURA, and
MAYOR FERNANDO Q. MIGUEL, REYES, JJ.
MUNICIPALITY OF KORONADAL
(NOW CITY OF KORONADAL),
PROVINCE OF SOUTH COTABATO,
represented by the MUNICIPAL
TREASURER and/or MUNICIPAL
MAYOR FERNANDO Q. MIGUEL,
and THE FIRST INTEGRATED Promulgated:
BONDING AND INSURANCE
COMPANY, INC. ,
Respondents. November 27, 2008
x--------------------------------------------------x
DECISION

REYES, R.T., J.:


On January 25, 1999, the RTC rendered judgment in favor of spouses Jayme, the dispositive
portion of which reads:
MAY a municipal mayor be held solidarily liable for the negligent acts of the driver assigned to
him, which resulted in the death of a minor pedestrian?

Challenged in this petition for review on certiorari is the Decision[1] of the Court of Appeals
(CA) which reversed and set aside the decision of the Regional Trial Court (RTC), Polomolok,
Cotabato City, Branch 39, insofar as defendant Mayor Fernando Q. Miguel is concerned. The
CA absolved Mayor Miguel from any liability since it was not he, but the Municipality of
Koronadal, that was the employer of the negligent driver.
The Facts
On February 5, 1989, Mayor Miguel of Koronadal, South Cotabato was on board the Isuzu pickup truck driven by Fidel Lozano, an employee of the Municipality ofKoronadal.[2] The pick-up
truck was registered under the name of Rodrigo Apostol, but it was then in the possession of
Ernesto Simbulan.[3] Lozano borrowed the pick-up truck from Simbulan to bring Miguel to
Buayan Airport at General Santos City to catch his Manila flight.[4]
The pick-up truck accidentally hit Marvin C. Jayme, a minor, who was then crossing the
National Highway in Poblacion, Polomolok, South Cotabato.[5] The intensity of the collision
sent Marvin some fifty (50) meters away from the point of impact, a clear indication that Lozano
was driving at a very high speed at the time of the accident.[6]
Marvin sustained severe head injuries with subdural hematoma and diffused cerebral contusion.
[7] He was initially treated at the Howard Hubbard MemorialHospital.[8] Due to the seriousness
of his injuries, he was airlifted to the Ricardo Limso Medical Center in Davao City for more
intensive treatment.[9] Despite medical attention, Marvin expired six (6) days after the accident.
[10]
Petitioners spouses Buenaventura and Rosario Jayme, the parents of Marvin, filed a complaint
for damages with the RTC against respondents.[11] In their complaint, they prayed that all
respondents be held solidarily liable for their loss. They pointed out that that proximate cause of
Marvins death was Lozanos negligent and reckless operation of the vehicle. They prayed for
actual, moral, and exemplary damages, attorneys fees, and litigation expenses.
In their respective Answers, all respondents denied liability for Marvins death. Apostol and
Simbulan averred that Lozano took the pick-up truck without their consent. Likewise, Miguel
and Lozano pointed out that Marvins sudden sprint across the highway made it impossible to
avoid the accident. Yet, Miguel denied being on board the vehicle when it hit Marvin. The
Municipality of Koronadal adopted the answer of Lozano and Miguel. As for First Integrated
Bonding and Insurance Company, Inc., the vehicle insurer, it insisted that its liability is
contributory and is only conditioned on the right of the insured. Since the insured did not file a
claim within the prescribed period, any cause of action against it had prescribed.
RTC Disposition

WHEREFORE, in view of the foregoing, the defendant Municipality of Koronadal cannot be


held liable for the damages incurred by other defendant (sic) being an agency of the State
performing a (sic) governmental functions. The same with defendant Hermogenes Simbulan, not
being the owner of the subject vehicle, he is absolved of any liability.
The complaint against defendant First Integrated Bonding Insurance Company, Inc. is hereby
ordered dismissed there being no cause of action against said insurance company.
However, defendants Fidel Lozano, Rodrigo Apostol, and Mayor Fernando Miguel of
Koronadal, South Cotabato, are hereby ordered jointly and severally to pay the plaintiff (sic) the
following sums:

1.
One Hundred Seventy Three Thousand One Hundred One and Forty Centavos
(P173,101.40) Pesos as actual damages with legal interest of 12% per annum computed from
February 11, 1989 until fully paid;
2. Fifty Thousand (P50,000.00) Pesos as moral damages;
3. Twenty Thousand (P20,000.00) Pesos as exemplary damages;
4. Twenty Thousand (P20,000.00) Pesos as Attorneys fees;
5. Fifty Thousand (P50,000.00) Pesos for the death of Marvin Jayme;
6. Three Thousand (P3,000.00) as litigation expenses; and
7. To pay the cost of this suit.
SO ORDERED.[12]
Dissatisfied with the RTC ruling, Mayor Miguel interposed an appeal to the CA.
CA Disposition
In his appeal, Mayor Miguel contended that the RTC erred in ruling that he was Lozanos
employer and, hence, solidarily liable for the latters negligent act.Records showed that the
Municipality of Koronadal was the drivers true and lawful employer. Mayor Miguel also denied
that he did not exercise due care and diligence in the supervision of Lozano. The incident,
although unfortunate, was unexpected and cannot be attributed to him.
On October 22, 2003, the CA granted the appeal, disposing as follows:

WHEREFORE, the Decision appealed from is REVERSED and SET ASIDE, insofar as
defendant-appellant Mayor Fernando Q. Miguel is concerned, and the complaint against him is
DISMISSED.
IT IS SO ORDERED.[13]

The CA held that Mayor Miguel should not be held liable for damages for the death of Marvin
Jayme. Said the appellate court:

the illicit act of the employee was on the occasion or by reason of the functions entrusted to him.
[17]

Moreover, plaintiffs-appellees admitted that Mayor Miguel was not the employer of Lozano.
Thus, paragraph 9 of the complaint alleged that the Municipality of Koronadal was the employer
of both Mayor Miguel and Lozano. Not being the employer of Lozano, Mayor Miguel could not
thus be held liable for the damages caused by the former. Mayor Miguel was a mere passenger
in the Isuzu pick-up at the time of the accident.[14] (Emphasis supplied)

Significantly, to make the employee liable under paragraphs 5 and 6 of Article 2180, it must be
established that the injurious or tortuous act was committed at the time the employee was
performing his functions.[18]

The CA also reiterated the settled rule that it is the registered owner of a vehicle who is jointly
and severally liable with the driver for damages incurred by passengers or third persons as a
consequence of injuries or death sustained in the operation of the vehicle.
Issues
The spouses Jayme have resorted to the present recourse and assign to the CA the following
errors:
I.
THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT MAYOR
FERNANDO MIGUEL CANNOT BE HELD LIABLE FOR THE DEATH OF MARVIN
JAYME WHICH CONCLUSION IS CONTRARY TO LAW AND THE SETTLED
PRONOUNCEMENTS OF THIS HONORABLE TRIBUNAL;
II.
THE FINDINGS OF FACTS OF THE HONORABLE COURT OF APPEALS ARE
CONTRARY TO THE FINDINGS OF THE TRIAL COURT AND ARECONTRADICTED BY
THE EVIDENCE ON RECORD; MOREOVER, THE CONCLUSIONS DRAWN BY THE
HONORABLE COURT OF APPEALS ARE ALL BASED ON CONJECTURES AND
SURMISES AND AGAINST ACCEPTED COURSE OF JUDICIAL PROCEEDINGS WHICH
URGENTLY CALL FOR AN EXERCISE OF THIS HONORABLE COURTS SUPERVISION.
[15]

Our Ruling
The doctrine of vicarious liability or imputed liability finds no application in the present case.
Spouses Jayme contend, inter alia, that vicarious liability attaches to Mayor Miguel. He was not
a mere passenger, but instead one who had direct control and supervision over Lozano during
the time of the accident. According to petitioners, the element of direct control is not negated by
the fact that Lozanos employer was the Municipality of Koronadal. Mayor Miguel, being
Lozanos superior, still had control over the manner the vehicle was operated.
Article 2180[16] of the Civil Code provides that a person is not only liable for ones own quasidelictual acts, but also for those persons for whom one is responsible for. This liability is
popularly known as vicarious or imputed liability. To sustain claims against employers for the
acts of their employees, the following requisites must be established: (1) That the employee was
chosen by the employer personally or through another; (2) That the service to be rendered in
accordance with orders which the employer has the authority to give at all times; and (3) That

Furthermore, the employer-employee relationship cannot be assumed. It is incumbent upon the


plaintiff to prove the relationship by preponderant evidence. InBelen v. Belen,[19] this Court
ruled that it was enough for defendant to deny an alleged employment relationship. The
defendant is under no obligation to prove the negative averment. This Court said:
It is an old and well-settled rule of the courts that the burden of proving the action is upon the
plaintiff, and that if he fails satisfactorily to show the facts upon which he bases his claim, the
defendant is under no obligation to prove his exceptions. This rue is in harmony with the
provisions of Section 297 of the Code of Civil Procedure holding that each party must prove his
own affirmative allegations, etc.[20]
In resolving the present controversy, it is imperative to find out if Mayor Miguel is, indeed, the
employer of Lozano and therefore liable for the negligent acts of the latter. To determine the
existence of an employment relationship, We rely on the four-fold test. This involves: (1) the
employers power of selection; (2) payment of wages or other remuneration; (3) the employers
right to control the method of doing the work; and (4) the employers right of suspension or
dismissal.[21]
Applying the foregoing test, the CA correctly held that it was the Municipality of Koronadal
which was the lawful employer of Lozano at the time of the accident.It is uncontested that
Lozano was employed as a driver by the municipality. That he was subsequently assigned to
Mayor Miguel during the time of the accident is of no moment. This Court has, on several
occasions, held that an employer-employee relationship still exists even if the employee was
loaned by the employer to another person or entity because control over the employee subsists.
[22] In the case under review, the Municipality of Koronadal remains to be Lozanos employer
notwithstanding Lozanos assignment to Mayor Miguel.
Spouses Jayme argued that Mayor Miguel had at least supervision and control over Lozano and
how the latter operated or drove the Isuzu pick-up during the time of the accident. They,
however, failed to buttress this claim.
Even assuming arguendo that Mayor Miguel had authority to give instructions or directions to
Lozano, he still can not be held liable. In Benson v. Sorrell,[23]the New England Supreme Court
ruled that mere giving of directions to the driver does not establish that the passenger has control
over the vehicle. Neither does it render one the employer of the driver. This Court, in Soliman,
Jr. v. Tuazon,[24] ruled in a similar vein, to wit:
x x x The fact that a client company may give instructions or directions to the security guards
assigned to it, does not, by itself, render the client responsible as an employer of the security
guards concerned and liable for their wrongful acts and omissions. Those instructions or
directions are ordinarily no more than requests commonly envisaged in the contract for services
entered into with the security agency. x x x[25] (Emphasis supplied)

Significantly, no negligence may be imputed against a fellow employee although the person may
have the right to control the manner of the vehicles operation.[26]In the absence of an employeremployee relationship establishing vicarious liability, the drivers negligence should not be
attributed to a fellow employee who only happens to be an occupant of the vehicle.[27]
Whatever right of control the occupant may have over the driver is not sufficient by itself to
justify an application of the doctrine of vicarious liability. Handley v. Lombardi[28] is
instructive on this exception to the rule on vicarious liability:
Plaintiff was not the master or principal of the driver of the truck, but only an intermediate and
superior employee or agent. This being so, the doctrine of respondeat superior or qui facit per
alium is not properly applicable to him. His power to direct and control the driver was not as
master, but only by virtue of the fact that they were both employed by Kruse, and the further fact
that as Kruses agent he was delegated Kruses authority over the driver. x x x
In the case of actionable negligence, the rule is well settled both in this state and elsewhere that
the negligence of a subordinate employee or subagent is not to be imputed to a superior
employee or agent, but only to the master or principal. (Hilton v. Oliver, 204 Cal. 535 [61 A. L.
R. 297, 269 Pac. 425]; Guild v. Brown, 115 Cal. App. 374 [1 Pac. (2d) 528]; Ellis v. Southern
Ry. Co., 72 S. C. 464 [2 L. R. A. (N. S.) 378, 52 S. E. 228]; Thurman v. Pittsburg & M. Copper
Co., 41 Mont. 141 [108 Pac. 588]; 2 Cor. Jur., p. 829; and see the elaborate note in 61 A. L. R.
277, and particularly that part commencing at p. 290.) We can see no logical reason for drawing
any distinction in this regard between actionable negligence and contributory negligence. x x
x[29]

committed by them in the discharge of governmental functions and can only be held answerable
only if it can be shown that they were acting in proprietary capacity. In permitting such entities
to be sued, the State merely gives the claimant the right to show that the defendant was not
acting in governmental capacity when the injury was committed or that the case comes under the
exceptions recognized by law. Failing this, the claimant cannot recover.[38]
Verily, liability attaches to the registered owner, the negligent driver and his direct employer.
The CA observation along this line are worth restating:
Settled is the rule that the registered owner of a vehicle is jointly and severally liable with the
driver for damages incurred by passengers and third persons as a consequence of injuries or
death sustained in the operation of said vehicles. Regardless of who the actual owner of the
vehicle is, the operator of record continues to be the operator of the vehicle as regards the public
and third persons, and as such is directly and primarily responsible for the consequences incident
(sic) to its operation x x x.[39]
The accidental death of Marvin Jayme is a tragic loss for his parents. However, justice demands
that only those liable under our laws be held accountable for Marvins demise. Justice can not
sway in favor of petitioners simply to assuage their pain and loss. The law on the matter is clear:
only the negligent driver, the drivers employer, and the registered owner of the vehicle are liable
for the death of a third person resulting from the negligent operation of the vehicle.
WHEREFORE, the petition is DENIED and the appealed Decision AFFIRMED.

The rule was reiterated in Bryant v. Pacific Elec. Ry. Co.[30] and again in Sichterman v.
Hollingshead Co.[31]
In Swanson v. McQuown,[32] a case involving a military officer who happened to be riding in a
car driven by a subordinate later involved in an accident, the Colorado Supreme Court adhered
to the general rule that a public official is not liable for the wrongful acts of his subordinates on
a vicarious basis since the relationship is not a true master-servant situation.[33] The court went
on to rule that the only exception is when they cooperate in the act complained of, or direct or
encourage it.[34]
In the case at bar, Mayor Miguel was neither Lozanos employer nor the vehicles registered
owner. There existed no causal relationship between him and Lozano or the vehicle used that
will make him accountable for Marvins death. Mayor Miguel was a mere passenger at the time
of the accident.
Parenthetically, it has been held that the failure of a passenger to assist the driver, by providing
him warnings or by serving as lookout does not make the passenger liable for the latters
negligent acts.[35] The drivers duty is not one that may be delegated to others.[36]
As correctly held by the trial court, the true and lawful employer of Lozano is the Municipality
of Koronadal. Unfortunately for Spouses Jayme, the municipality may not be sued because it is
an agency of the State engaged in governmental functions and, hence, immune from suit. This
immunity is illustrated in Municipality of San Fernando, La Union v. Firme,[37] where this
Court held:
It has already been remarked that municipal corporations are suable because their charters grant
them the competence to sue and be sued. Nevertheless, they are generally not liable for torts

FIRST DIVISION
G.R. No. 126297

January 31, 2007

PROFESSIONAL SERVICES, INC., Petitioner,


vs.
NATIVIDAD and ENRIQUE AGANA, Respondents.
x-----------------------x
G.R. No. 126467

January 31, 2007

NATIVIDAD (Substituted by her children MARCELINO AGANA III, ENRIQUE


AGANA, JR., EMMA AGANA ANDAYA, JESUS AGANA, and RAYMUND AGANA) and
ENRIQUE AGANA, Petitioners,
vs.
JUAN FUENTES, Respondent.
x- - - - - - - - - - - - - - - - - - - -- - - - x
G.R. No. 127590

January 31, 2007

MIGUEL AMPIL, Petitioner,


vs.
NATIVIDAD AGANA and ENRIQUE AGANA, Respondents.

DECISION
SANDOVAL-GUTIERREZ, J.:

On May 9, 1984, Natividad, accompanied by her husband, went to the United States to seek
further treatment. After four months of consultations and laboratory examinations, Natividad
was told she was free of cancer. Hence, she was advised to return to the Philippines.

Hospitals, having undertaken one of mankinds most important and delicate endeavors, must
assume the grave responsibility of pursuing it with appropriate care. The care and service
dispensed through this high trust, however technical, complex and esoteric its character may be,
must meet standards of responsibility commensurate with the undertaking to preserve and
protect the health, and indeed, the very lives of those placed in the hospitals keeping. 1

On August 31, 1984, Natividad flew back to the Philippines, still suffering from pains. Two
weeks thereafter, her daughter found a piece of gauze protruding from her vagina. Upon being
informed about it, Dr. Ampil proceeded to her house where he managed to extract by hand a
piece of gauze measuring 1.5 inches in width. He then assured her that the pains would soon
vanish.

Assailed in these three consolidated petitions for review on certiorari is the Court of Appeals
Decision2 dated September 6, 1996 in CA-G.R. CV No. 42062 and CA-G.R. SP No. 32198
affirming with modification the Decision3dated March 17, 1993 of the Regional Trial Court
(RTC), Branch 96, Quezon City in Civil Case No. Q-43322 and nullifying its Order dated
September 21, 1993.

Dr. Ampils assurance did not come true. Instead, the pains intensified, prompting Natividad to
seek treatment at the Polymedic General Hospital. While confined there, Dr. Ramon Gutierrez
detected the presence of another foreign object in her vagina -- a foul-smelling gauze measuring
1.5 inches in width which badly infected her vaginal vault. A recto-vaginal fistula had formed in
her reproductive organs which forced stool to excrete through the vagina. Another surgical
operation was needed to remedy the damage. Thus, in October 1984, Natividad underwent
another surgery.

The facts, as culled from the records, are:


On April 4, 1984, Natividad Agana was rushed to the Medical City General Hospital (Medical
City Hospital) because of difficulty of bowel movement and bloody anal discharge. After a
series of medical examinations, Dr. Miguel Ampil, petitioner in G.R. No. 127590, diagnosed her
to be suffering from "cancer of the sigmoid."

On November 12, 1984, Natividad and her husband filed with the RTC, Branch 96, Quezon City
a complaint for damages against the Professional Services, Inc. (PSI), owner of the Medical City
Hospital, Dr. Ampil, and Dr. Fuentes, docketed as Civil Case No. Q-43322. They alleged that the
latter are liable for negligence for leaving two pieces of gauze inside Natividads body and
malpractice for concealing their acts of negligence.

On April 11, 1984, Dr. Ampil, assisted by the medical staff4 of the Medical City Hospital,
performed an anterior resection surgery on Natividad. He found that the malignancy in her
sigmoid area had spread on her left ovary, necessitating the removal of certain portions of it.
Thus, Dr. Ampil obtained the consent of Natividads husband, Enrique Agana, to permit Dr. Juan
Fuentes, respondent in G.R. No. 126467, to perform hysterectomy on her.

Meanwhile, Enrique Agana also filed with the Professional Regulation Commission (PRC) an
administrative complaint for gross negligence and malpractice against Dr. Ampil and Dr.
Fuentes, docketed as Administrative Case No. 1690. The PRC Board of Medicine heard the case
only with respect to Dr. Fuentes because it failed to acquire jurisdiction over Dr. Ampil who was
then in the United States.

After Dr. Fuentes had completed the hysterectomy, Dr. Ampil took over, completed the
operation and closed the incision.

On February 16, 1986, pending the outcome of the above cases, Natividad died and was duly
substituted by her above-named children (the Aganas).

However, the operation appeared to be flawed. In the corresponding Record of Operation dated
April 11, 1984, the attending nurses entered these remarks:

On March 17, 1993, the RTC rendered its Decision in favor of the Aganas, finding PSI, Dr.
Ampil and Dr. Fuentes liable for negligence and malpractice, the decretal part of which reads:

"sponge count lacking 2

WHEREFORE, judgment is hereby rendered for the plaintiffs ordering the defendants
PROFESSIONAL SERVICES, INC., DR. MIGUEL AMPIL and DR. JUAN FUENTES to pay
to the plaintiffs, jointly and severally, except in respect of the award for exemplary damages and
the interest thereon which are the liabilities of defendants Dr. Ampil and Dr. Fuentes only, as
follows:

"announced to surgeon searched (sic) done but to no avail continue for closure."
On April 24, 1984, Natividad was released from the hospital. Her hospital and medical bills,
including the doctors fees, amounted to P60,000.00.

1. As actual damages, the following amounts:


After a couple of days, Natividad complained of excruciating pain in her anal region. She
consulted both Dr. Ampil and Dr. Fuentes about it. They told her that the pain was the natural
consequence of the surgery. Dr. Ampil then recommended that she consult an oncologist to
examine the cancerous nodes which were not removed during the operation.

a. The equivalent in Philippine Currency of the total of US$19,900.00 at the


rate of P21.60-US$1.00, as reimbursement of actual expenses incurred in the
United States of America;

b. The sum of P4,800.00 as travel taxes of plaintiffs and their physician


daughter;
c. The total sum of P45,802.50, representing the cost of hospitalization at
Polymedic Hospital, medical fees, and cost of the saline solution;

Miguel Ampil is liable to reimburse defendant-appellant Professional Services, Inc., whatever


amount the latter will pay or had paid to the plaintiffs-appellees, the decision appealed from is
hereby AFFIRMED and the instant appeal DISMISSED.

3. As exemplary damages, the sum of P300,000.00;

Concomitant with the above, the petition for certiorari and prohibition filed by herein defendantappellant Dr. Juan Fuentes in CA-G.R. SP No. 32198 is hereby GRANTED and the challenged
order of the respondent judge dated September 21, 1993, as well as the alias writ of execution
issued pursuant thereto are hereby NULLIFIED and SET ASIDE. The bond posted by the
petitioner in connection with the writ of preliminary injunction issued by this Court on
November 29, 1993 is hereby cancelled.

4. As attorneys fees, the sum of P250,000.00;

Costs against defendants-appellants Dr. Miguel Ampil and Professional Services, Inc.

5. Legal interest on items 1 (a), (b), and (c); 2; and 3 hereinabove, from date of filing
of the complaint until full payment; and

SO ORDERED.

6. Costs of suit.

Only Dr. Ampil filed a motion for reconsideration, but it was denied in a Resolution 7 dated
December 19, 1996.

2. As moral damages, the sum of P2,000,000.00;

SO ORDERED.

Hence, the instant consolidated petitions.

Aggrieved, PSI, Dr. Fuentes and Dr. Ampil interposed an appeal to the Court of Appeals,
docketed as CA-G.R. CV No. 42062.

In G.R. No. 126297, PSI alleged in its petition that the Court of Appeals erred in holding that:
(1) it is estopped from raising the defense that Dr. Ampil is not its employee; (2) it is solidarily
liable with Dr. Ampil; and (3) it is not entitled to its counterclaim against the Aganas. PSI
contends that Dr. Ampil is not its employee, but a mere consultant or independent contractor. As
such, he alone should answer for his negligence.

Incidentally, on April 3, 1993, the Aganas filed with the RTC a motion for a partial execution of
its Decision, which was granted in an Order dated May 11, 1993. Thereafter, the sheriff levied
upon certain properties of Dr. Ampil and sold them for P451,275.00 and delivered the amount to
the Aganas.
Following their receipt of the money, the Aganas entered into an agreement with PSI and Dr.
Fuentes to indefinitely suspend any further execution of the RTC Decision. However, not long
thereafter, the Aganas again filed a motion for an alias writ of execution against the properties of
PSI and Dr. Fuentes. On September 21, 1993, the RTC granted the motion and issued the
corresponding writ, prompting Dr. Fuentes to file with the Court of Appeals a petition for
certiorari and prohibition, with prayer for preliminary injunction, docketed as CA-G.R. SP No.
32198. During its pendency, the Court of Appeals issued a Resolution5 dated October 29, 1993
granting Dr. Fuentes prayer for injunctive relief.

In G.R. No. 126467, the Aganas maintain that the Court of Appeals erred in finding that Dr.
Fuentes is not guilty of negligence or medical malpractice, invoking the doctrine of res ipsa
loquitur. They contend that the pieces of gauze are prima facie proofs that the operating surgeons
have been negligent.
Finally, in G.R. No. 127590, Dr. Ampil asserts that the Court of Appeals erred in finding him
liable for negligence and malpractice sans evidence that he left the two pieces of gauze in
Natividads vagina. He pointed to other probable causes, such as: (1) it was Dr. Fuentes who
used gauzes in performing the hysterectomy; (2) the attending nurses failure to properly count
the gauzes used during surgery; and (3) the medical intervention of the American doctors who
examined Natividad in the United States of America.

On January 24, 1994, CA-G.R. SP No. 32198 was consolidated with CA-G.R. CV No. 42062.
Meanwhile, on January 23, 1995, the PRC Board of Medicine rendered its Decision 6 in
Administrative Case No. 1690 dismissing the case against Dr. Fuentes. The Board held that the
prosecution failed to show that Dr. Fuentes was the one who left the two pieces of gauze inside
Natividads body; and that he concealed such fact from Natividad.

For our resolution are these three vital issues: first, whether the Court of Appeals erred in
holding Dr. Ampil liable for negligence and malpractice; second, whether the Court of Appeals
erred in absolving Dr. Fuentes of any liability; and third, whether PSI may be held solidarily
liable for the negligence of Dr. Ampil.
I - G.R. No. 127590

On September 6, 1996, the Court of Appeals rendered its Decision jointly disposing of CA-G.R.
CV No. 42062 and CA-G.R. SP No. 32198, thus:
WHEREFORE, except for the modification that the case against defendant-appellant Dr. Juan
Fuentes is hereby DISMISSED, and with the pronouncement that defendant-appellant Dr.

Whether the Court of Appeals Erred in Holding Dr. Ampil


Liable for Negligence and Malpractice.

Dr. Ampil, in an attempt to absolve himself, gears the Courts attention to other possible causes
of Natividads detriment. He argues that the Court should not discount either of the following
possibilities: first, Dr. Fuentes left the gauzes in Natividads body after performing
hysterectomy; second, the attending nurses erred in counting the gauzes; and third, the American
doctors were the ones who placed the gauzes in Natividads body.

Here, Dr. Ampil did not inform Natividad about the missing two pieces of gauze. Worse, he even
misled her that the pain she was experiencing was the ordinary consequence of her operation.
Had he been more candid, Natividad could have taken the immediate and appropriate medical
remedy to remove the gauzes from her body. To our mind, what was initially an act of
negligence by Dr. Ampil has ripened into a deliberate wrongful act of deceiving his patient.

Dr. Ampils arguments are purely conjectural and without basis. Records show that he did not
present any evidence to prove that the American doctors were the ones who put or left the
gauzes in Natividads body. Neither did he submit evidence to rebut the correctness of the record
of operation, particularly the number of gauzes used. As to the alleged negligence of Dr.
Fuentes, we are mindful that Dr. Ampil examined his (Dr. Fuentes) work and found it in order.

This is a clear case of medical malpractice or more appropriately, medical negligence. To


successfully pursue this kind of case, a patient must only prove that a health care provider either
failed to do something which a reasonably prudent health care provider would have done, or that
he did something that a reasonably prudent provider would not have done; and that failure or
action caused injury to the patient.11 Simply put, the elements are duty, breach, injury and
proximate causation. Dr, Ampil, as the lead surgeon, had the duty to remove all foreign objects,
such as gauzes, from Natividads body before closure of the incision. When he failed to do so, it
was his duty to inform Natividad about it. Dr. Ampil breached both duties. Such breach caused
injury to Natividad, necessitating her further examination by American doctors and another
surgery. That Dr. Ampils negligence is the proximate cause12 of Natividads injury could be
traced from his act of closing the incision despite the information given by the attending nurses
that two pieces of gauze were still missing. That they were later on extracted from Natividads
vagina established the causal link between Dr. Ampils negligence and the injury. And what
further aggravated such injury was his deliberate concealment of the missing gauzes from the
knowledge of Natividad and her family.

The glaring truth is that all the major circumstances, taken together, as specified by the Court of
Appeals, directly point to Dr. Ampil as the negligent party, thus:
First, it is not disputed that the surgeons used gauzes as sponges to control the
bleeding of the patient during the surgical operation.
Second, immediately after the operation, the nurses who assisted in the surgery noted
in their report that the sponge count (was) lacking 2; that such anomaly was
announced to surgeon and that a search was done but to no avail prompting Dr.
Ampil to continue for closure x x x.
Third, after the operation, two (2) gauzes were extracted from the same spot of the
body of Mrs. Agana where the surgery was performed.
An operation requiring the placing of sponges in the incision is not complete until the sponges
are properly removed, and it is settled that the leaving of sponges or other foreign substances in
the wound after the incision has been closed is at least prima facie negligence by the operating
surgeon.8 To put it simply, such act is considered so inconsistent with due care as to raise an
inference of negligence. There are even legions of authorities to the effect that such act is
negligence per se.9
Of course, the Court is not blind to the reality that there are times when danger to a patients life
precludes a surgeon from further searching missing sponges or foreign objects left in the body.
But this does not leave him free from any obligation. Even if it has been shown that a surgeon
was required by the urgent necessities of the case to leave a sponge in his patients abdomen,
because of the dangers attendant upon delay, still, it is his legal duty to so inform his patient
within a reasonable time thereafter by advising her of what he had been compelled to do. This is
in order that she might seek relief from the effects of the foreign object left in her body as her
condition might permit. The ruling in Smith v. Zeagler 10 is explicit, thus:
The removal of all sponges used is part of a surgical operation, and when a physician or surgeon
fails to remove a sponge he has placed in his patients body that should be removed as part of the
operation, he thereby leaves his operation uncompleted and creates a new condition which
imposes upon him the legal duty of calling the new condition to his patients attention, and
endeavoring with the means he has at hand to minimize and avoid untoward results likely to
ensue therefrom.

II - G.R. No. 126467


Whether the Court of Appeals Erred in Absolving
Dr. Fuentes of any Liability
The Aganas assailed the dismissal by the trial court of the case against Dr. Fuentes on the ground
that it is contrary to the doctrine of res ipsa loquitur. According to them, the fact that the two
pieces of gauze were left inside Natividads body is a prima facie evidence of Dr. Fuentes
negligence.
We are not convinced.
Literally, res ipsa loquitur means "the thing speaks for itself." It is the rule that the fact of the
occurrence of an injury, taken with the surrounding circumstances, may permit an inference or
raise a presumption of negligence, or make out a plaintiffs prima facie case, and present a
question of fact for defendant to meet with an explanation. 13Stated differently, where the thing
which caused the injury, without the fault of the injured, is under the exclusive control of the
defendant and the injury is such that it should not have occurred if he, having such control used
proper care, it affords reasonable evidence, in the absence of explanation that the injury arose
from the defendants want of care, and the burden of proof is shifted to him to establish that he
has observed due care and diligence.14
From the foregoing statements of the rule, the requisites for the applicability of the doctrine of
res ipsa loquitur are: (1) the occurrence of an injury; (2) the thing which caused the injury was
under the control and management of the defendant; (3) the occurrence was such that in the
ordinary course of things, would not have happened if those who had control or management
used proper care; and (4) the absence of explanation by the defendant. Of the foregoing

requisites, the most instrumental is the "control and management of the thing which caused the
injury."15

medical malpractice. Many courts now allow claims for hospital vicarious liability under the
theories of respondeat superior, apparent authority, ostensible authority, or agency by estoppel.

We find the element of "control and management of the thing which caused the injury" to be
wanting. Hence, the doctrine of res ipsa loquitur will not lie.

In this jurisdiction, the statute governing liability for negligent acts is Article 2176 of the Civil
Code, which reads:

It was duly established that Dr. Ampil was the lead surgeon during the operation of Natividad.
He requested the assistance of Dr. Fuentes only to perform hysterectomy when he (Dr. Ampil)
found that the malignancy in her sigmoid area had spread to her left ovary. Dr. Fuentes
performed the surgery and thereafter reported and showed his work to Dr. Ampil. The latter
examined it and finding everything to be in order, allowed Dr. Fuentes to leave the operating
room. Dr. Ampil then resumed operating on Natividad. He was about to finish the procedure
when the attending nurses informed him that two pieces of gauze were missing. A "diligent
search" was conducted, but the misplaced gauzes were not found. Dr. Ampil then directed that
the incision be closed. During this entire period, Dr. Fuentes was no longer in the operating
room and had, in fact, left the hospital.

Art. 2176. Whoever by act or omission causes damage to another, there being fault or
negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no preexisting contractual relation between the parties, is called a quasi-delict and is governed by the
provisions of this Chapter.

Under the "Captain of the Ship" rule, the operating surgeon is the person in complete charge of
the surgery room and all personnel connected with the operation. Their duty is to obey his
orders.16 As stated before, Dr. Ampil was the lead surgeon. In other words, he was the "Captain
of the Ship." That he discharged such role is evident from his following conduct: (1) calling Dr.
Fuentes to perform a hysterectomy; (2) examining the work of Dr. Fuentes and finding it in
order; (3) granting Dr. Fuentes permission to leave; and (4) ordering the closure of the incision.
To our mind, it was this act of ordering the closure of the incision notwithstanding that two
pieces of gauze remained unaccounted for, that caused injury to Natividads body. Clearly, the
control and management of the thing which caused the injury was in the hands of Dr. Ampil, not
Dr. Fuentes.
In this jurisdiction, res ipsa loquitur is not a rule of substantive law, hence, does not per se create
or constitute an independent or separate ground of liability, being a mere evidentiary rule. 17 In
other words, mere invocation and application of the doctrine does not dispense with the
requirement of proof of negligence. Here, the negligence was proven to have been committed by
Dr. Ampil and not by Dr. Fuentes.

20

A derivative of this provision is Article 2180, the rule governing vicarious liability under the
doctrine of respondeat superior, thus:
ART. 2180. The obligation imposed by Article 2176 is demandable not only for ones own acts
or omissions, but also for those of persons for whom one is responsible.
x x x

x x x

The owners and managers of an establishment or enterprise are likewise responsible for damages
caused by their employees in the service of the branches in which the latter are employed or on
the occasion of their functions.
Employers shall be liable for the damages caused by their employees and household helpers
acting within the scope of their assigned tasks even though the former are not engaged in any
business or industry.
x x x

x x x

The responsibility treated of in this article shall cease when the persons herein mentioned prove
that they observed all the diligence of a good father of a family to prevent damage.

The third issue necessitates a glimpse at the historical development of hospitals and the resulting
theories concerning their liability for the negligence of physicians.

A prominent civilist commented that professionals engaged by an employer, such as physicians,


dentists, and pharmacists, are not "employees" under this article because the manner in which
they perform their work is not within the control of the latter (employer). In other words,
professionals are considered personally liable for the fault or negligence they commit in the
discharge of their duties, and their employer cannot be held liable for such fault or negligence. In
the context of the present case, "a hospital cannot be held liable for the fault or negligence of a
physician or surgeon in the treatment or operation of patients."21

Until the mid-nineteenth century, hospitals were generally charitable institutions, providing
medical services to the lowest classes of society, without regard for a patients ability to
pay.18 Those who could afford medical treatment were usually treated at home by their
doctors.19 However, the days of house calls and philanthropic health care are over. The modern
health care industry continues to distance itself from its charitable past and has experienced a
significant conversion from a not-for-profit health care to for-profit hospital businesses.
Consequently, significant changes in health law have accompanied the business-related changes
in the hospital industry. One important legal change is an increase in hospital liability for

The foregoing view is grounded on the traditional notion that the professional status and the very
nature of the physicians calling preclude him from being classed as an agent or employee of a
hospital, whenever he acts in a professional capacity.22 It has been said that medical practice
strictly involves highly developed and specialized knowledge, 23 such that physicians are
generally free to exercise their own skill and judgment in rendering medical services sans
interference.24 Hence, when a doctor practices medicine in a hospital setting, the hospital and its
employees are deemed to subserve him in his ministrations to the patient and his actions are of
his own responsibility.25

III - G.R. No. 126297


Whether PSI Is Liable for the Negligence of Dr. Ampil

The case of Schloendorff v. Society of New York Hospital26 was then considered an authority for
this view. The "Schloendorff doctrine" regards a physician, even if employed by a hospital, as an
independent contractor because of the skill he exercises and the lack of control exerted over his
work. Under this doctrine, hospitals are exempt from the application of the respondeat superior
principle for fault or negligence committed by physicians in the discharge of their profession.
However, the efficacy of the foregoing doctrine has weakened with the significant developments
in medical care. Courts came to realize that modern hospitals are increasingly taking active role
in supplying and regulating medical care to patients. No longer were a hospitals functions
limited to furnishing room, food, facilities for treatment and operation, and attendants for its
patients. Thus, in Bing v. Thunig,27 the New York Court of Appeals deviated from the
Schloendorff doctrine, noting that modern hospitals actually do far more than provide facilities
for treatment. Rather, they regularly employ, on a salaried basis, a large staff of physicians,
interns, nurses, administrative and manual workers. They charge patients for medical care and
treatment, even collecting for such services through legal action, if necessary. The court then
concluded that there is no reason to exempt hospitals from the universal rule of respondeat
superior.
In our shores, the nature of the relationship between the hospital and the physicians is rendered
inconsequential in view of our categorical pronouncement in Ramos v. Court of Appeals 28 that
for purposes of apportioning responsibility in medical negligence cases, an employer-employee
relationship in effect exists between hospitals and their attending and visiting physicians. This
Court held:
"We now discuss the responsibility of the hospital in this particular incident. The unique practice
(among private hospitals) of filling up specialist staff with attending and visiting "consultants,"
who are allegedly not hospital employees, presents problems in apportioning responsibility for
negligence in medical malpractice cases. However, the difficulty is more apparent than real.
In the first place, hospitals exercise significant control in the hiring and firing of consultants and
in the conduct of their work within the hospital premises. Doctors who apply for consultant
slots, visiting or attending, are required to submit proof of completion of residency, their
educational qualifications, generally, evidence of accreditation by the appropriate board
(diplomate), evidence of fellowship in most cases, and references. These requirements are
carefully scrutinized by members of the hospital administration or by a review committee set up
by the hospital who either accept or reject the application. x x x.
After a physician is accepted, either as a visiting or attending consultant, he is normally required
to attend clinico-pathological conferences, conduct bedside rounds for clerks, interns and
residents, moderate grand rounds and patient audits and perform other tasks and responsibilities,
for the privilege of being able to maintain a clinic in the hospital, and/or for the privilege of
admitting patients into the hospital. In addition to these, the physicians performance as a
specialist is generally evaluated by a peer review committee on the basis of mortality and
morbidity statistics, and feedback from patients, nurses, interns and residents. A consultant
remiss in his duties, or a consultant who regularly falls short of the minimum standards
acceptable to the hospital or its peer review committee, is normally politely terminated.
In other words, private hospitals, hire, fire and exercise real control over their attending and
visiting consultant staff. While consultants are not, technically employees, x x x, the control
exercised, the hiring, and the right to terminate consultants all fulfill the important hallmarks of
an employer-employee relationship, with the exception of the payment of wages. In assessing

whether such a relationship in fact exists, the control test is determining. Accordingly, on the
basis of the foregoing, we rule that for the purpose of allocating responsibility in medical
negligence cases, an employer-employee relationship in effect exists between hospitals and their
attending and visiting physicians. "
But the Ramos pronouncement is not our only basis in sustaining PSIs liability. Its liability is
also anchored upon the agency principle of apparent authority or agency by estoppel and the
doctrine of corporate negligence which have gained acceptance in the determination of a
hospitals liability for negligent acts of health professionals. The present case serves as a perfect
platform to test the applicability of these doctrines, thus, enriching our jurisprudence.
Apparent authority, or what is sometimes referred to as the "holding
out" theory, or doctrine of ostensible agency or agency by estoppel, 29 has its origin from the law
of agency. It imposes liability, not as the result of the reality of a contractual relationship, but
rather because of the actions of a principal or an employer in somehow misleading the public
into believing that the relationship or the authority exists. 30 The concept is essentially one of
estoppel and has been explained in this manner:
"The principal is bound by the acts of his agent with the apparent authority which he knowingly
permits the agent to assume, or which he holds the agent out to the public as possessing. The
question in every case is whether the principal has by his voluntary act placed the agent in such
a situation that a person of ordinary prudence, conversant with business usages and the nature of
the particular business, is justified in presuming that such agent has authority to perform the
particular act in question.31
The applicability of apparent authority in the field of hospital liability was upheld long time ago
in Irving v. Doctor Hospital of Lake Worth, Inc.32 There, it was explicitly stated that "there does
not appear to be any rational basis for excluding the concept of apparent authority from the field
of hospital liability." Thus, in cases where it can be shown that a hospital, by its actions, has held
out a particular physician as its agent and/or employee and that a patient has accepted treatment
from that physician in the reasonable belief that it is being rendered in behalf of the hospital,
then the hospital will be liable for the physicians negligence.
Our jurisdiction recognizes the concept of an agency by implication or estoppel. Article 1869 of
the Civil Code reads:
ART. 1869. Agency may be express, or implied from the acts of the principal, from his silence or
lack of action, or his failure to repudiate the agency, knowing that another person is acting on his
behalf without authority.
In this case, PSI publicly displays in the lobby of the Medical City Hospital the names and
specializations of the physicians associated or accredited by it, including those of Dr. Ampil and
Dr. Fuentes. We concur with the Court of Appeals conclusion that it "is now estopped from
passing all the blame to the physicians whose names it proudly paraded in the public directory
leading the public to believe that it vouched for their skill and competence." Indeed, PSIs act is
tantamount to holding out to the public that Medical City Hospital, through its accredited
physicians, offers quality health care services. By accrediting Dr. Ampil and Dr. Fuentes and
publicly advertising their qualifications, the hospital created the impression that they were its
agents, authorized to perform medical or surgical services for its patients. As expected, these

patients, Natividad being one of them, accepted the services on the reasonable belief that such
were being rendered by the hospital or its employees, agents, or servants. The trial court
correctly pointed out:
x x x regardless of the education and status in life of the patient, he ought not be burdened with
the defense of absence of employer-employee relationship between the hospital and the
independent physician whose name and competence are certainly certified to the general public
by the hospitals act of listing him and his specialty in its lobby directory, as in the case herein.
The high costs of todays medical and health care should at least exact on the hospital greater, if
not broader, legal responsibility for the conduct of treatment and surgery within its facility by its
accredited physician or surgeon, regardless of whether he is independent or employed." 33
The wisdom of the foregoing ratiocination is easy to discern. Corporate entities, like PSI, are
capable of acting only through other individuals, such as physicians. If these accredited
physicians do their job well, the hospital succeeds in its mission of offering quality medical
services and thus profits financially. Logically, where negligence mars the quality of its services,
the hospital should not be allowed to escape liability for the acts of its ostensible agents.
We now proceed to the doctrine of corporate negligence or corporate responsibility.
One allegation in the complaint in Civil Case No. Q-43332 for negligence and malpractice is
that PSI as owner, operator and manager of Medical City Hospital, "did not perform the
necessary supervision nor exercise diligent efforts in the supervision of Drs. Ampil and Fuentes
and its nursing staff, resident doctors, and medical interns who assisted Drs. Ampil and Fuentes
in the performance of their duties as surgeons."34 Premised on the doctrine of corporate
negligence, the trial court held that PSI is directly liable for such breach of duty.
We agree with the trial court.
Recent years have seen the doctrine of corporate negligence as the judicial answer to the
problem of allocating hospitals liability for the negligent acts of health practitioners, absent
facts to support the application of respondeat superior or apparent authority. Its formulation
proceeds from the judiciarys acknowledgment that in these modern times, the duty of providing
quality medical service is no longer the sole prerogative and responsibility of the physician. The
modern hospitals have changed structure. Hospitals now tend to organize a highly professional
medical staff whose competence and performance need to be monitored by the hospitals
commensurate with their inherent responsibility to provide quality medical care. 35
The doctrine has its genesis in Darling v. Charleston Community Hospital. 36 There, the Supreme
Court of Illinois held that "the jury could have found a hospital negligent, inter alia, in failing to
have a sufficient number of trained nurses attending the patient; failing to require a consultation
with or examination by members of the hospital staff; and failing to review the treatment
rendered to the patient." On the basis of Darling, other jurisdictions held that a hospitals
corporate negligence extends to permitting a physician known to be incompetent to practice at
the hospital.37 With the passage of time, more duties were expected from hospitals, among them:
(1) the use of reasonable care in the maintenance of safe and adequate facilities and equipment;
(2) the selection and retention of competent physicians; (3) the overseeing or supervision of all
persons who practice medicine within its walls; and (4) the formulation, adoption and
enforcement of adequate rules and policies that ensure quality care for its patients. 38 Thus, in
Tucson Medical Center, Inc. v. Misevich,39 it was held that a hospital, following the doctrine of

corporate responsibility, has the duty to see that it meets the standards of responsibilities for the
care of patients. Such duty includes the proper supervision of the members of its medical staff.
And in Bost v. Riley,40 the court concluded that a patient who enters a hospital does so with the
reasonable expectation that it will attempt to cure him. The hospital accordingly has the duty to
make a reasonable effort to monitor and oversee the treatment prescribed and administered by
the physicians practicing in its premises.
In the present case, it was duly established that PSI operates the Medical City Hospital for the
purpose and under the concept of providing comprehensive medical services to the public.
Accordingly, it has the duty to exercise reasonable care to protect from harm all patients
admitted into its facility for medical treatment. Unfortunately, PSI failed to perform such duty.
The findings of the trial court are convincing, thus:
x x x PSIs liability is traceable to its failure to conduct an investigation of the matter reported in
the nota bene of the count nurse. Such failure established PSIs part in the dark conspiracy of
silence and concealment about the gauzes. Ethical considerations, if not also legal, dictated the
holding of an immediate inquiry into the events, if not for the benefit of the patient to whom the
duty is primarily owed, then in the interest of arriving at the truth. The Court cannot accept that
the medical and the healing professions, through their members like defendant surgeons, and
their institutions like PSIs hospital facility, can callously turn their backs on and disregard even
a mere probability of mistake or negligence by refusing or failing to investigate a report of such
seriousness as the one in Natividads case.
It is worthy to note that Dr. Ampil and Dr. Fuentes operated on Natividad with the assistance of
the Medical City Hospitals staff, composed of resident doctors, nurses, and interns. As such, it
is reasonable to conclude that PSI, as the operator of the hospital, has actual or constructive
knowledge of the procedures carried out, particularly the report of the attending nurses that the
two pieces of gauze were missing. In Fridena v. Evans, 41 it was held that a corporation is bound
by the knowledge acquired by or notice given to its agents or officers within the scope of their
authority and in reference to a matter to which their authority extends. This means that the
knowledge of any of the staff of Medical City Hospital constitutes knowledge of PSI. Now, the
failure of PSI, despite the attending nurses report, to investigate and inform Natividad regarding
the missing gauzes amounts to callous negligence. Not only did PSI breach its duties to oversee
or supervise all persons who practice medicine within its walls, it also failed to take an active
step in fixing the negligence committed. This renders PSI, not only vicariously liable for the
negligence of Dr. Ampil under Article 2180 of the Civil Code, but also directly liable for its own
negligence under Article 2176. In Fridena, the Supreme Court of Arizona held:
x x x In recent years, however, the duty of care owed to the patient by the hospital has expanded.
The emerging trend is to hold the hospital responsible where the hospital has failed to monitor
and review medical services being provided within its walls. See Kahn Hospital Malpractice
Prevention, 27 De Paul . Rev. 23 (1977).
Among the cases indicative of the emerging trend is Purcell v. Zimbelman, 18 Ariz. App.
75,500 P. 2d 335 (1972). In Purcell, the hospital argued that it could not be held liable for the
malpractice of a medical practitioner because he was an independent contractor within the
hospital. The Court of Appeals pointed out that the hospital had created a professional staff
whose competence and performance was to be monitored and reviewed by the governing body
of the hospital, and the court held that a hospital would be negligent where it had knowledge or
reason to believe that a doctor using the facilities was employing a method of treatment or care
which fell below the recognized standard of care.

Subsequent to the Purcell decision, the Arizona Court of Appeals held that a hospital has certain
inherent responsibilities regarding the quality of medical care furnished to patients within its
walls and it must meet the standards of responsibility commensurate with this undertaking.
Beeck v. Tucson General Hospital, 18 Ariz. App. 165, 500 P. 2d 1153 (1972). This court has
confirmed the rulings of the Court of Appeals that a hospital has the duty of supervising the
competence of the doctors on its staff. x x x.
x

x x

In the amended complaint, the plaintiffs did plead that the operation was performed at the
hospital with its knowledge, aid, and assistance, and that the negligence of the defendants was
the proximate cause of the patients injuries. We find that such general allegations of negligence,
along with the evidence produced at the trial of this case, are sufficient to support the hospitals
liability based on the theory of negligent supervision."
Anent the corollary issue of whether PSI is solidarily liable with Dr. Ampil for damages, let it be
emphasized that PSI, apart from a general denial of its responsibility, failed to adduce evidence
showing that it exercised the diligence of a good father of a family in the accreditation and
supervision of the latter. In neglecting to offer such proof, PSI failed to discharge its burden
under the last paragraph of Article 2180 cited earlier, and, therefore, must be adjudged solidarily
liable with Dr. Ampil. Moreover, as we have discussed, PSI is also directly liable to the Aganas.
One final word. Once a physician undertakes the treatment and care of a patient, the law
imposes on him certain obligations. In order to escape liability, he must possess that reasonable
degree of learning, skill and experience required by his profession. At the same time, he must
apply reasonable care and diligence in the exercise of his skill and the application of his
knowledge, and exert his best judgment.
WHEREFORE, we DENY all the petitions and AFFIRM the challenged Decision of the Court
of Appeals in CA-G.R. CV No. 42062 and CA-G.R. SP No. 32198.
Costs against petitioners PSI and Dr. Miguel Ampil.
SO ORDERED.
[G.R. No. 120554. September 21, 1999]
SO PING BUN, petitioner, vs. COURT OF APPEALS, TEK HUA ENTERPRISING
CORP. and MANUEL C. TIONG, respondents.
DECISION
QUISUMBING, J.:
This petition for certiorari challenges the Decision[1] of the Court of Appeals dated October 10,
1994, and the Resolution[2] dated June 5, 1995, in CA-G.R. CV No. 38784. The appellate court
affirmed the decision of the Regional Trial Court of Manila, Branch 35, except for the award of
attorneys fees, as follows:
"WHEREFORE, foregoing considered, the appeal of respondent-appellant So Ping Bun for lack
of merit is DISMISSED. The appealed decision dated April 20, 1992 of the court a quo is
modified by reducing the attorney's fees awarded to plaintiff Tek Hua Enterprising Corporation
from P500,000.00 to P200,000.00."[3]
The facts are as follows:

In 1963, Tek Hua Trading Co, through its managing partner, So Pek Giok, entered into lease
agreements with lessor Dee C. Chuan & Sons Inc. (DCCSI). Subjects of four (4) lease contracts
were premises located at Nos. 930, 930-Int., 924-B and 924-C, Soler Street, Binondo, Manila.
Tek Hua used the areas to store its textiles. The contracts each had a one-year term. They
provided that should the lessee continue to occupy the premises after the term, the lease shall be
on a month-to-month basis.
When the contracts expired, the parties did not renew the contracts, but Tek Hua continued to
occupy the premises. In 1976, Tek Hua Trading Co. was dissolved. Later, the original members
of Tek Hua Trading Co. including Manuel C. Tiong, formed Tek Hua Enterprising Corp., herein
respondent corporation.
So Pek Giok, managing partner of Tek Hua Trading, died in 1986. So Pek Gioks grandson,
petitioner So Ping Bun, occupied the warehouse for his own textile business, Trendsetter
Marketing.
On August 1, 1989, lessor DCCSI sent letters addressed to Tek Hua Enterprises, informing the
latter of the 25% increase in rent effective September 1, 1989. The rent increase was later on
reduced to 20% effective January 1, 1990, upon other lessees demand. Again on December 1,
1990, the lessor implemented a 30% rent increase. Enclosed in these letters were new lease
contracts for signing. DCCSI warned that failure of the lessee to accomplish the contracts shall
be deemed as lack of interest on the lessees part, and agreement to the termination of the lease.
Private respondents did not answer any of these letters. Still, the lease contracts were not
rescinded.
On March 1, 1991, private respondent Tiong sent a letter to petitioner, which reads as follows:
March 1, 1991
Mr. So Ping Bun
930 Soler Street
Binondo, Manila
Dear Mr. So,
Due to my closed (sic) business associate (sic) for three decades with your late grandfather Mr.
So Pek Giok and late father, Mr. So Chong Bon, I allowed you temporarily to use the warehouse
of Tek Hua Enterprising Corp. for several years to generate your personal business.
Since I decided to go back into textile business, I need a warehouse immediately for my stocks.
Therefore, please be advised to vacate all your stocks in Tek Hua Enterprising Corp. Warehouse.
You are hereby given 14 days to vacate the premises unless you have good reasons that you have
the right to stay. Otherwise, I will be constrained to take measure to protect my interest.
Please give this urgent matter your preferential attention to avoid inconvenience on your part.
Very truly yours,
(Sgd) Manuel C. Tiong
MANUEL C. TIONG
President[4]
Petitioner refused to vacate. On March 4, 1992, petitioner requested formal contracts of lease
with DCCSI in favor Trendsetter Marketing. So Ping Bun claimed that after the death of his
grandfather, So Pek Giok, he had been occupying the premises for his textile business and
religiously paid rent. DCCSI acceded to petitioners request. The lease contracts in favor of
Trendsetter were executed.
In the suit for injunction, private respondents pressed for the nullification of the lease contracts
between DCCSI and petitioner. They also claimed damages.
After trial, the trial court ruled:
WHEREFORE, judgment is rendered:
1. Annulling the four Contracts of Lease (Exhibits A, A-1 to A-3, inclusive) all dated March 11,
1991, between defendant So Ping Bun, doing business under the name and style of Trendsetter
Marketing, and defendant Dee C. Chuan & Sons, Inc. over the premises located at Nos. 924-B,
924-C, 930 and 930, Int., respectively, Soler Street, Binondo Manila;
2. Making permanent the writ of preliminary injunction issued by this Court on June 21, 1991;

3. Ordering defendant So Ping Bun to pay the aggrieved party, plaintiff Tek Hua Enterprising
Corporation, the sum of P500,000.00, for attorneys fees;
4. Dismissing the complaint, insofar as plaintiff Manuel C. Tiong is concerned, and the
respective counterclaims of the defendant;
5. Ordering defendant So Ping Bun to pay the costs of this lawsuit;
This judgment is without prejudice to the rights of plaintiff Tek Hua Enterprising Corporation
and defendant Dee C. Chuan & Sons, Inc. to negotiate for the renewal of their lease contracts
over the premises located at Nos. 930, 930-Int., 924-B and 924-C Soler Street, Binondo, Manila,
under such terms and conditions as they agree upon, provided they are not contrary to law,
public policy, public order, and morals.
SO ORDERED.[5]
Petitioners motion for reconsideration of the above decision was denied.
On appeal by So Ping Bun, the Court of Appeals upheld the trial court. On motion for
reconsideration, the appellate court modified the decision by reducing the award of attorneys
fees from five hundred thousand (P500,000.00) pesos to two hundred thousand (P200,000.00)
pesos.
Petitioner is now before the Court raising the following issues:
I. WHETHER THE APPELLATE COURT ERRED IN AFFIRMING THE TRIAL COURTS
DECISION FINDING SO PING BUN GUILTY OF TORTUOUS INTERFERENCE OF
CONTRACT?
II. WHETHER THE APPELLATE COURT ERRED IN AWARDING ATTORNEYS FEES OF
P200,000.00 IN FAVOR OF PRIVATE RESPONDENTS.
The foregoing issues involve, essentially, the correct interpretation of the applicable law on
tortuous conduct, particularly unlawful interference with contract. We have to begin, obviously,
with certain fundamental principles on torts and damages.
Damage is the loss, hurt, or harm which results from injury, and damages are the recompense or
compensation awarded for the damage suffered.[6] One becomes liable in an action for damages
for a nontrespassory invasion of anothers interest in the private use and enjoyment of asset if (a)
the other has property rights and privileges with respect to the use or enjoyment interfered with,
(b) the invasion is substantial, (c) the defendants conduct is a legal cause of the invasion, and (d)
the invasion is either intentional and unreasonable or unintentional and actionable under general
negligence rules.[7]
The elements of tort interference are: (1) existence of a valid contract; (2) knowledge on the part
of the third person of the existence of contract; and (3) interference of the third person is without
legal justification or excuse.[8]
A duty which the law of torts is concerned with is respect for the property of others, and a cause
of action ex delicto may be predicated upon an unlawful interference by one person of the
enjoyment by the other of his private property.[9] This may pertain to a situation where a third
person induces a party to renege on or violate his undertaking under a contract. In the case
before us, petitioners Trendsetter Marketing asked DCCSI to execute lease contracts in its favor,
and as a result petitioner deprived respondent corporation of the latters property right. Clearly,
and as correctly viewed by the appellate court, the three elements of tort interference abovementioned are present in the instant case.
Authorities debate on whether interference may be justified where the defendant acts for the sole
purpose of furthering his own financial or economic interest.[10] One view is that, as a general
rule, justification for interfering with the business relations of another exists where the actors
motive is to benefit himself. Such justification does not exist where his sole motive is to cause
harm to the other. Added to this, some authorities believe that it is not necessary that the
interferers interest outweigh that of the party whose rights are invaded, and that an individual
acts under an economic interest that is substantial, not merely de minimis, such that wrongful
and malicious motives are negatived, for he acts in self-protection.[11] Moreover, justification
for protecting ones financial position should not be made to depend on a comparison of his

economic interest in the subject matter with that of others.[12] It is sufficient if the impetus of
his conduct lies in a proper business interest rather than in wrongful motives.[13]
As early as Gilchrist vs. Cuddy,[14] we held that where there was no malice in the interference
of a contract, and the impulse behind ones conduct lies in a proper business interest rather than
in wrongful motives, a party cannot be a malicious interferer. Where the alleged interferer is
financially interested, and such interest motivates his conduct, it cannot be said that he is an
officious or malicious intermeddler.[15]
In the instant case, it is clear that petitioner So Ping Bun prevailed upon DCCSI to lease the
warehouse to his enterprise at the expense of respondent corporation. Though petitioner took
interest in the property of respondent corporation and benefited from it, nothing on record
imputes deliberate wrongful motives or malice on him.
Section 1314 of the Civil Code categorically provides also that, Any third person who induces
another to violate his contract shall be liable for damages to the other contracting party.
Petitioner argues that damage is an essential element of tort interference, and since the trial court
and the appellate court ruled that private respondents were not entitled to actual, moral or
exemplary damages, it follows that he ought to be absolved of any liability, including attorneys
fees.
It is true that the lower courts did not award damages, but this was only because the extent of
damages was not quantifiable. We had a similar situation in Gilchrist, where it was difficult or
impossible to determine the extent of damage and there was nothing on record to serve as basis
thereof. In that case we refrained from awarding damages. We believe the same conclusion
applies in this case.
While we do not encourage tort interferers seeking their economic interest to intrude into
existing contracts at the expense of others, however, we find that the conduct herein complained
of did not transcend the limits forbidding an obligatory award for damages in the absence of any
malice. The business desire is there to make some gain to the detriment of the contracting
parties. Lack of malice, however, precludes damages. But it does not relieve petitioner of the
legal liability for entering into contracts and causing breach of existing ones. The respondent
appellate court correctly confirmed the permanent injunction and nullification of the lease
contracts between DCCSI and Trendsetter Marketing, without awarding damages. The
injunction saved the respondents from further damage or injury caused by petitioners
interference.
Lastly, the recovery of attorneys fees in the concept of actual or compensatory damages, is
allowed under the circumstances provided for in Article 2208 of the Civil Code.[16] One such
occasion is when the defendants act or omission has compelled the plaintiff to litigate with third
persons or to incur expenses to protect his interest.[17] But we have consistently held that the
award of considerable damages should have clear factual and legal bases.[18] In connection with
attorneys fees, the award should be commensurate to the benefits that would have been derived
from a favorable judgment. Settled is the rule that fairness of the award of damages by the trial
court calls for appellate review such that the award if far too excessive can be reduced.[19] This
ruling applies with equal force on the award of attorneys fees.In a long line of cases we said, It is
not sound policy to place a penalty on the right to litigate. To compel the defeated party to pay
the fees of counsel for his successful opponent would throw wide open the door of temptation to
the opposing party and his counsel to swell the fees to undue proportions.[20]
Considering that the respondent corporations lease contract, at the time when the cause of action
accrued, ran only on a month-to-month basis whence before it was on a yearly basis, we find
even the reduced amount of attorneys fees ordered by the Court of Appeals still exorbitant in the
light of prevailing jurisprudence.[21] Consequently, the amount of two hundred thousand
(P200,000.00) awarded by respondent appellate court should be reduced to one hundred
thousand (P100,000.00) pesos as the reasonable award for attorneys fees in favor of private
respondent corporation.
WHEREFORE, the petition is hereby DENIED. The assailed Decision and Resolution of the
Court of Appeals in CA-G.R. CV No. 38784 are hereby AFFIRMED, with MODIFICATION

that the award of attorneys fees is reduced from two hundred thousand (P200,000.00) to one
hundred thousand (P100,000.00) pesos. No pronouncement as to costs.
[G.R. No. 124354. April 11, 2002]
ROGELIO E. RAMOS and ERLINDA RAMOS, in their own behalf and as natural
guardians of the minors, ROMMEL RAMOS, ROY RODERICK RAMOS, and RON
RAYMOND RAMOS, petitioners, vs. COURT OF APPEALS, DE LOS SANTOS
MEDICAL CENTER, DR. ORLINO HOSAKA and DR. PERFECTA GUTIERREZ,
respondents.
RESOLUTION
KAPUNAN, J.:
Private respondents De Los Santos Medical Center, Dr. Orlino Hosaka and Dr. Perfecta
Gutierrez move for a reconsideration of the Decision, dated December 29, 1999, of this Court
holding them civilly liable for petitioner Erlinda Ramos comatose condition after she delivered
herself to them for their professional care and management.
For better understanding of the issues raised in private respondents respective motions, we will
briefly restate the facts of the case as follows:
Sometime in 1985, petitioner Erlinda Ramos, after seeking professional medical help, was
advised to undergo an operation for the removal of a stone in her gall bladder
(cholecystectomy). She was referred to Dr. Hosaka, a surgeon, who agreed to perform the
operation on her. The operation was scheduled for June 17, 1985 at 9:00 in the morning at
private respondent De Los Santos Medical Center (DLSMC). Since neither petitioner Erlinda
nor her husband, petitioner Rogelio, knew of any anesthesiologist, Dr. Hosaka recommended to
them the services of Dr. Gutierrez.
Petitioner Erlinda was admitted to the DLSMC the day before the scheduled operation. By 7:30
in the morning of the following day, petitioner Erlinda was already being prepared for operation.
Upon the request of petitioner Erlinda, her sister-in-law, Herminda Cruz, who was then Dean of
the College of Nursing at the Capitol Medical Center, was allowed to accompany her inside the
operating room.
At around 9:30 in the morning, Dr. Hosaka had not yet arrived so Dr. Gutierrez tried to get in
touch with him by phone. Thereafter, Dr. Gutierrez informed Cruz that the operation might be
delayed due to the late arrival of Dr. Hosaka. In the meantime, the patient, petitioner Erlinda said
to Cruz, Mindy, inip na inip na ako, ikuha mo ako ng ibang Doctor.
By 10:00 in the morning, when Dr. Hosaka was still not around, petitioner Rogelio already
wanted to pull out his wife from the operating room. He met Dr. Garcia, who remarked that he
was also tired of waiting for Dr. Hosaka. Dr. Hosaka finally arrived at the hospital at around
12:10 in the afternoon, or more than three (3) hours after the scheduled operation.
Cruz, who was then still inside the operating room, heard about Dr. Hosakas arrival. While she
held the hand of Erlinda, Cruz saw Dr. Gutierrez trying to intubate the patient. Cruz heard Dr.
Gutierrez utter: ang hirap ma-intubate nito, mali yata ang pagkakapasok. O lumalaki ang tiyan.
Cruz noticed a bluish discoloration of Erlindas nailbeds on her left hand. She (Cruz) then heard
Dr. Hosaka instruct someone to call Dr. Calderon, another anesthesiologist. When he arrived, Dr.
Calderon attempted to intubate the patient. The nailbeds of the patient remained bluish, thus, she
was placed in a trendelenburg position a position where the head of the patient is placed in a
position lower than her feet. At this point, Cruz went out of the operating room to express her
concern to petitioner Rogelio that Erlindas operation was not going well.
Cruz quickly rushed back to the operating room and saw that the patient was still in
trendelenburg position. At almost 3:00 in the afternoon, she saw Erlinda being wheeled to the
Intensive Care Unit (ICU). The doctors explained to petitioner Rogelio that his wife had
bronchospasm. Erlinda stayed in the ICU for a month. She was released from the hospital only
four months later or on November 15, 1985. Since the ill-fated operation, Erlinda remained in
comatose condition until she died on August 3, 1999.[1]

Petitioners filed with the Regional Trial Court of Quezon City a civil case for damages against
private respondents. After due trial, the court a quo rendered judgment in favor of petitioners.
Essentially, the trial court found that private respondents were negligent in the performance of
their duties to Erlinda. On appeal by private respondents, the Court of Appeals reversed the trial
courts decision and directed petitioners to pay their unpaid medical bills to private respondents.
Petitioners filed with this Court a petition for review on certiorari. The private respondents were
then required to submit their respective comments thereon. On December 29, 1999, this Court
promulgated the decision which private respondents now seek to be reconsidered. The
dispositive portion of said Decision states:
WHEREFORE, the decision and resolution of the appellate court appealed from are hereby
modified so as to award in favor of petitioners, and solidarily against private respondents the
following: 1) P1,352,000.00 as actual damages computed as of the date of promulgation of this
decision plus a monthly payment of P8,000.00 up to the time that petitioner Erlinda Ramos
expires or miraculously survives; 2) P2,000,000.00 as moral damages, 3) P1,500,000.00 as
temperate damages; 4) P100,000.00 each exemplary damages and attorneys fees; and 5) the
costs of the suit.[2]
In his Motion for Reconsideration, private respondent Dr. Hosaka submits the following as
grounds therefor:
I
THE HONORABLE SUPREME COURT COMMITTED REVERSIBLE ERROR WHEN IT
HELD RESPONDENT DR. HOSAKA LIABLE ON THE BASIS OF THE CAPTAIN-OFTHE-SHIP DOCTRINE.
II
THE HONORABLE SUPREME COURT ERRED IN HOLDING RESPONDENT DR.
HOSAKA LIABLE DESPITE THE FACT THAT NO NEGLIGENCE CAN BE
ATTRIBUTABLE TO HIM.
III
ASSUMING WITHOUT ADMITTING THAT RESPONDENT DR. HOSAKA IS LIABLE,
THE HONORABLE SUPREME COURT ERRED IN AWARDING DAMAGES THAT WERE
CLEARLY EXCESSIVE AND WITHOUT LEGAL BASIS.[3]
Private respondent Dr. Gutierrez, for her part, avers that:
A. THE HONORABLE SUPREME COURT MAY HAVE INADVERTENTLY
OVERLOOKED THE FACT THAT THE COURT OF APPEALS DECISION DATED 29 MAY
1995 HAD ALREADY BECOME FINAL AND EXECUTORY AS OF 25 JUNE 1995,
THEREBY DEPRIVING THIS HONORABLE COURT OF JURISDICTION OVER THE
INSTANT PETITION;
B. THE HONORABLE SUPREME COURT MAY HAVE INADVERTENTLY
OVERLOOKED SEVERAL MATERIAL FACTUAL CIRCUMSTANCES WHICH, IF
PROPERLY CONSIDERED, WOULD INDUBITABLY LEAD TO NO OTHER
CONCLUSION BUT THAT PRIVATE RESPONDENT DOCTORS WERE NOT GUILTY OF
ANY NEGLIGENCE IN RESPECT OF THE INSTANT CASE;
B.1 RESPONDENT DOCTOR PERFECTA GUTIERREZ HAS SUFFICIENTLY
DISCHARGED THE BURDEN OF EVIDENCE BY SUBSTANTIAL PROOF OF HER
COMPLIANCE WITH THE STANDARDS OF DUE CARE EXPECTED IN HER
RESPECTIVE FIELD OF MEDICAL SPECIALIZATION.
B.2 RESPONDENT DOCTOR PERFECTA GUTIERREZ HAS SUFFICIENTLY
DISCHARGED THE BURDEN OF EVIDENCE BY SUBSTANTIAL PROOF OF HER
HAVING SUCCESSFULLY INTUBATED PATIENT ERLINDA RAMOS
C. THE SUPREME COURT MAY HAVE INADVERTENTLY PLACED TOO MUCH
RELIANCE ON THE TESTIMONY OF PETITIONERS WITNESS HERMINDA CRUZ,
DESPITE THE EXISTENCE OF SEVERAL FACTUAL CIRCUMSTANCES WHICH
RENDERS DOUBT ON HER CREDIBILITY

D. THE SUPREME COURT MAY HAVE INADVERTENTLY DISREGARDED THE EXPERT


TESTIMONY OF DR. JAMORA AND DRA. CALDERON
E. THE HONORABLE SUPREME COURT MAY HAVE INADVERTENTLY AWARDED
DAMAGES TO PETITIONERS DESPITE THE FACT THAT THERE WAS NO
NEGLIGENCE ON THE PART OF RESPONDENT DOCTOR.[4]
Private respondent De Los Santos Medical Center likewise moves for reconsideration on the
following grounds:
I
THE HONORABLE COURT ERRED IN GIVING DUE COURSE TO THE INSTANT
PETITION AS THE DECISION OF THE HONORABLE COURT OF APPEALS HAD
ALREADY BECOME FINAL AND EXECUTORY
II
THE HONORABLE SUPREME COURT ERRED IN FINDING THAT AN EMPLOYEREMPLOYEE [RELATIONSHIP] EXISTS BETWEEN RESPONDENT DE LOS SANTOS
MEDICAL CENTER AND DRS. ORLINO HOSAKA AND PERFECTA GUTIERREZ
III
THE HONORABLE SUPREME COURT ERRED IN FINDING THAT RESPONDENT DE
LOS SANTOS MEDICAL CENTER IS SOLIDARILY LIABLE WITH RESPONDENT
DOCTORS
IV
THE HONORABLE SUPREME COURT ERRED IN INCREASING THE AWARD OF
DAMAGES IN FAVOR OF PETITIONERS.[5]
In the Resolution of February 21, 2000, this Court denied the motions for reconsideration of
private respondents Drs. Hosaka and Gutierrez. They then filed their respective second motions
for reconsideration. The Philippine College of Surgeons filed its Petition-in-Intervention
contending in the main that this Court erred in holding private respondent Dr. Hosaka liable
under the captain of the ship doctrine. According to the intervenor, said doctrine had long been
abandoned in the United States in recognition of the developments in modern medical and
hospital practice.[6] The Court noted these pleadings in the Resolution of July 17, 2000.[7]
On March 19, 2001, the Court heard the oral arguments of the parties, including the intervenor.
Also present during the hearing were the amicii curiae: Dr. Felipe A. Estrella, Jr., Consultant of
the Philippine Charity Sweepstakes, former Director of the Philippine General Hospital and
former Secretary of Health; Dr. Iluminada T. Camagay, President of the Philippine Society of
Anesthesiologists, Inc. and Professor and Vice-Chair for Research, Department of
Anesthesiology, College of Medicine-Philippine General Hospital, University of the Philippines;
and Dr. Lydia M. Egay, Professor and Vice-Chair for Academics, Department of Anesthesiology,
College of Medicine-Philippine General Hospital, University of the Philippines.
The Court enumerated the issues to be resolved in this case as follows:
1. WHETHER OR NOT DR. ORLINO HOSAKA (SURGEON) IS LIABLE FOR
NEGLIGENCE;
2. WHETHER OR NOT DR. PERFECTA GUTIERREZ (ANESTHESIOLOGIST) IS LIABLE
FOR NEGLIGENCE; AND
3. WHETHER OR NOT THE HOSPITAL (DELOS SANTOS MEDICAL CENTER) IS
LIABLE FOR ANY ACT OF NEGLIGENCE COMMITTED BY THEIR VISITING
CONSULTANT SURGEON AND ANESTHESIOLOGIST.[8]
We shall first resolve the issue pertaining to private respondent Dr. Gutierrez. She maintains that
the Court erred in finding her negligent and in holding that it was the faulty intubation which
was the proximate cause of Erlindas comatose condition. The following objective facts allegedly
negate a finding of negligence on her part: 1) That the outcome of the procedure was a comatose
patient and not a dead one; 2) That the patient had a cardiac arrest; and 3) That the patient was
revived from that cardiac arrest.[9] In effect, Dr. Gutierrez insists that, contrary to the finding of
this Court, the intubation she performed on Erlinda was successful.

Unfortunately, Dr. Gutierrez claim of lack of negligence on her part is belied by the records of
the case. It has been sufficiently established that she failed to exercise the standards of care in
the administration of anesthesia on a patient. Dr. Egay enlightened the Court on what these
standards are:
x x x What are the standards of care that an anesthesiologist should do before we administer
anesthesia? The initial step is the preparation of the patient for surgery and this is a pre-operative
evaluation because the anesthesiologist is responsible for determining the medical status of the
patient, developing the anesthesia plan and acquainting the patient or the responsible adult
particularly if we are referring with the patient or to adult patient who may not have, who may
have some mental handicaps of the proposed plans. We do pre-operative evaluation because this
provides for an opportunity for us to establish identification and personal acquaintance with the
patient. It also makes us have an opportunity to alleviate anxiety, explain techniques and risks to
the patient, given the patient the choice and establishing consent to proceed with the plan. And
lastly, once this has been agreed upon by all parties concerned the ordering of pre-operative
medications. And following this line at the end of the evaluation we usually come up on writing,
documentation is very important as far as when we train an anesthesiologist we always
emphasize this because we need records for our protection, well, records. And it entails having
brief summary of patient history and physical findings pertinent to anesthesia, plan, organize as
a problem list, the plan anesthesia technique, the plan post operative, pain management if
appropriate, special issues for this particular patient. There are needs for special care after
surgery and if it so it must be written down there and a request must be made known to proper
authorities that such and such care is necessary. And the request for medical evaluation if there is
an indication. When we ask for a cardio-pulmonary clearance it is not in fact to tell them if this
patient is going to be fit for anesthesia, the decision to give anesthesia rests on the
anesthesiologist. What we ask them is actually to give us the functional capacity of certain
systems which maybe affected by the anesthetic agent or the technique that we are going to use.
But the burden of responsibility in terms of selection of agent and how to administer it rest on
the anesthesiologist.[10]
The conduct of a preanesthetic/preoperative evaluation prior to an operation, whether elective or
emergency, cannot be dispensed with.[11] Such evaluation is necessary for the formulation of a
plan of anesthesia care suited to the needs of the patient concerned.
Pre-evaluation for anesthesia involves taking the patients medical history, reviewing his current
drug therapy, conducting physical examination, interpreting laboratory data, and determining the
appropriate prescription of preoperative medications as necessary to the conduct of anesthesia.
[12]
Physical examination of the patient entails not only evaluating the patients central nervous
system, cardiovascular system and lungs but also the upper airway. Examination of the upper
airway would in turn include an analysis of the patients cervical spine mobility,
temporomandibular mobility, prominent central incisors, deceased or artificial teeth, ability to
visualize uvula and the thyromental distance.[13]
Nonetheless, Dr. Gutierrez omitted to perform a thorough preoperative evaluation on Erlinda. As
she herself admitted, she saw Erlinda for the first time on the day of the operation itself, one
hour before the scheduled operation. She auscultated[14] the patients heart and lungs and
checked the latters blood pressure to determine if Erlinda was indeed fit for operation.[15]
However, she did not proceed to examine the patients airway. Had she been able to check
petitioner Erlindas airway prior to the operation, Dr. Gutierrez would most probably not have
experienced difficulty in intubating the former, and thus the resultant injury could have been
avoided. As we have stated in our Decision:
In the case at bar, respondent Dra. Gutierrez admitted that she saw Erlinda for the first time on
the day of the operation itself, on 17 June 1985. Before this date, no prior consultations with, or
pre-operative evaluation of Erlinda was done by her. Until the day of the operation, respondent
Dra. Gutierrez was unaware of the physiological make-up and needs of Erlinda. She was
likewise not properly informed of the possible difficulties she would face during the

administration of anesthesia to Erlinda. Respondent Dra. Gutierrez act of seeing her patient for
the first time only an hour before the scheduled operative procedure was, therefore, an act of
exceptional negligence and professional irresponsibility. The measures cautioning prudence and
vigilance in dealing with human lives lie at the core of the physicians centuries-old Hippocratic
Oath. Her failure to follow this medical procedure is, therefore, a clear indicia of her negligence.
[16]
Further, there is no cogent reason for the Court to reverse its finding that it was the faulty
intubation on Erlinda that caused her comatose condition. There is no question that Erlinda
became comatose after Dr. Gutierrez performed a medical procedure on her. Even the counsel of
Dr. Gutierrez admitted to this fact during the oral arguments:
CHIEF JUSTICE:
Mr. Counsel, you started your argument saying that this involves a comatose patient?
ATTY. GANA:
Yes, Your Honor.
CHIEF JUSTICE:
How do you mean by that, a comatose, a comatose after any other acts were done by Dr.
Gutierrez or comatose before any act was done by her?
ATTY. GANA:
No, we meant comatose as a final outcome of the procedure.
CHIEF JUSTICE:
Meaning to say, the patient became comatose after some intervention, professional acts have
been done by Dr. Gutierrez?
ATTY. GANA:
Yes, Your Honor.
CHIEF JUSTICE:
In other words, the comatose status was a consequence of some acts performed by D. Gutierrez?
ATTY. GANA:
It was a consequence of the well, (interrupted)
CHIEF JUSTICE:
An acts performed by her, is that not correct?
ATTY. GANA:
Yes, Your Honor.
CHIEF JUSTICE:
Thank you.[17]
What is left to be determined therefore is whether Erlindas hapless condition was due to any
fault or negligence on the part of Dr. Gutierrez while she (Erlinda) was under the latters care. Dr.
Gutierrez maintains that the bronchospasm and cardiac arrest resulting in the patients comatose
condition was brought about by the anaphylactic reaction of the patient to Thiopental Sodium
(pentothal).[18] In the Decision, we explained why we found Dr. Gutierrez theory unacceptable.
In the first place, Dr. Eduardo Jamora, the witness who was presented to support her (Dr.
Gutierrez) theory, was a pulmonologist. Thus, he could not be considered an authority on
anesthesia practice and procedure and their complications.[19]
Secondly, there was no evidence on record to support the theory that Erlinda developed an
allergic reaction to pentothal. Dr. Camagay enlightened the Court as to the manifestations of an
allergic reaction in this wise:
DR. CAMAGAY:
All right, let us qualify an allergic reaction. In medical terminology an allergic reaction is
something which is not usual response and it is further qualified by the release of a hormone
called histamine and histamine has an effect on all the organs of the body generally release
because the substance that entered the body reacts with the particular cell, the mass cell, and the
mass cell secretes this histamine. In a way it is some form of response to take away that which is
not mine, which is not part of the body. So, histamine has multiple effects on the body. So, one
of the effects as you will see you will have redness, if you have an allergy you will have tearing

of the eyes, you will have swelling, very crucial swelling sometimes of the larynges which is
your voice box main airway, that swelling may be enough to obstruct the entry of air to the
trachea and you could also have contraction, constriction of the smaller airways beyond the
trachea, you see you have the trachea this way, we brought some visual aids but unfortunately
we do not have a projector. And then you have the smaller airways, the bronchi and then
eventually into the mass of the lungs you have the bronchus. The difference is that these tubes
have also in their walls muscles and this particular kind of muscles is smooth muscle so, when
histamine is released they close up like this and that phenomenon is known as bronco spasm.
However, the effects of histamine also on blood vessels are different. They dilate blood vessel
open up and the patient or whoever has this histamine release has hypertension or low blood
pressure to a point that the patient may have decrease blood supply to the brain and may collapse
so, you may have people who have this.[20]
These symptoms of an allergic reaction were not shown to have been extant in Erlindas case. As
we held in our Decision, no evidence of stridor, skin reactions, or wheezing some of the more
common accompanying signs of an allergic reaction appears on record. No laboratory data were
ever presented to the court.[21]
Dr. Gutierrez, however, insists that she successfully intubated Erlinda as evidenced by the fact
that she was revived after suffering from cardiac arrest. Dr. Gutierrez faults the Court for giving
credence to the testimony of Cruz on the matter of the administration of anesthesia when she
(Cruz), being a nurse, was allegedly not qualified to testify thereon. Rather, Dr. Gutierrez invites
the Courts attention to her synopsis on what transpired during Erlindas intubation:
12:15 p.m. Patient was inducted with sodium pentothal 2.5% (250 mg) given by slow IV. 02 was
started by mask. After pentothal injection this was followed by IV injection of Norcuron 4mg.
After 2 minutes 02 was given by positive pressure for about one minute. Intubation with
endotracheal tube 7.5 m in diameter was done with slight difficulty (short neck & slightly
prominent upper teeth) chest was examined for breath sounds & checked if equal on both sides.
The tube was then anchored to the mouth by plaster & cuff inflated. Ethrane 2% with 02 4 liters
was given.Blood pressure was checked 120/80 & heart rate regular and normal 90/min.
12:25 p.m. After 10 minutes patient was cyanotic. Ethrane was discontinued & 02 given alone.
Cyanosis disappeared. Blood pressure and heart beats stable.
12:30 p.m. Cyanosis again reappeared this time with sibilant and sonorous rales all over the
chest. D_5%_H20 & 1 ampule of aminophyline by fast drip was started. Still the cyanosis was
persistent.Patient was connected to a cardiac monitor. Another ampule of of [sic] aminophyline
was given and solu cortef was given.
12:40 p.m. There was cardiac arrest. Extra cardiac massage and intercardiac injection of
adrenalin was given & heart beat reappeared in less than one minute. Sodium bicarbonate &
another dose of solu cortef was given by IV. Cyanosis slowly disappeared & 02 continuously
given & assisted positive pressure. Laboratory exams done (see results in chart).
Patient was transferred to ICU for further management.[22]
From the foregoing, it can be allegedly seen that there was no withdrawal (extubation) of the
tube. And the fact that the cyanosis allegedly disappeared after pure oxygen was supplied
through the tube proved that it was properly placed.
The Court has reservations on giving evidentiary weight to the entries purportedly contained in
Dr. Gutierrez synopsis. It is significant to note that the said record prepared by Dr. Gutierrez was
made only after Erlinda was taken out of the operating room. The standard practice in anesthesia
is that every single act that the anesthesiologist performs must be recorded. In Dr. Gutierrez
case, she could not account for at least ten (10) minutes of what happened during the
administration of anesthesia on Erlinda. The following exchange between Dr. Estrella, one of the
amicii curiae, and Dr. Gutierrez is instructive:
DR. ESTRELLA
You mentioned that there were two (2) attempts in the intubation period?
DR. GUTIERREZ
Yes.

Q There were two attempts. In the first attempt was the tube inserted or was the laryngoscope
only inserted, which was inserted?
A All the laryngoscope.
Q All the laryngoscope. But if I remember right somewhere in the re-direct, a certain lawyer,
you were asked that you did a first attempt and the question was did you withdraw the tube? And
you said you never withdrew the tube, is that right?
A Yes.
Q Yes. And so if you never withdrew the tube then there was no, there was no insertion of the
tube during that first attempt. Now, the other thing that we have to settle here is when cyanosis
occurred, is it recorded in the anesthesia record when the cyanosis, in your recording when did
the cyanosis occur?
A (sic)
Q Is it a standard practice of anesthesia that whatever you do during that period or from the time
of induction to the time that you probably get the patient out of the operating room that every
single action that you do is so recorded in your anesthesia record?
A I was not able to record everything I did not have time anymore because I did that after the,
when the patient was about to leave the operating room. When there was second cyanosis
already that was the (interrupted)
Q When was the first cyanosis?
A The first cyanosis when I was (interrupted)
Q What time, more or less?
A I think it was 12:15 or 12:16.
Q Well, if the record will show you started induction at 12:15?
A Yes, Your Honor.
Q And the first medication you gave was what?
A The first medication, no, first the patient was oxygenated for around one to two minutes.
Q Yes, so, that is about 12:13?
A Yes, and then, I asked the resident physician to start giving the pentothal very slowly and that
was around one minute.
Q So, that is about 12:13 no, 12:15, 12:17?
A Yes, and then, after one minute another oxygenation was given and after (interrupted)
Q 12:18?
A Yes, and then after giving the oxygen we start the menorcure which is a relaxant. After that
relaxant (interrupted)
Q After that relaxant, how long do you wait before you do any manipulation?
A Usually you wait for two minutes or three minutes.
Q So, if our estimate of the time is accurate we are now more or less 12:19, is that right?
A Maybe.
Q 12:19. And at that time, what would have been done to this patient?
A After that time you examine the, if there is relaxation of the jaw which you push it downwards
and when I saw that the patient was relax because that monorcure is a relaxant, you cannot
intubate the patient or insert the laryngoscope if it is not keeping him relax. So, my first attempt
when I put the laryngoscope on I saw the trachea was deeply interiorly. So, what I did ask
mahirap ata ito ah. So, I removed the laryngoscope and oxygenated again the patient.
Q So, more or less you attempted to do an intubation after the first attempt as you claimed that it
was only the laryngoscope that was inserted.
A Yes.
Q And in the second attempt you inserted the laryngoscope and now possible intubation?
A Yes.
Q And at that point, you made a remark, what remark did you make?
A I said mahirap ata ito when the first attempt I did not see the trachea right away. That was
when I (interrupted)
Q That was the first attempt?

A Yes.
Q What about the second attempt?
A On the second attempt I was able to intubate right away within two to three seconds.
Q At what point, for purposes of discussion without accepting it, at what point did you make the
comment na mahirap ata to intubate, mali ata ang pinasukan
A I did not say mali ata ang pinasukan I never said that.
Q Well, just for the information of the group here the remarks I am making is based on the
documents that were forwarded to me by the Supreme Court. That is why for purposes of
discussion I am trying to clarify this for the sake of enlightenment. So, at what point did you
ever make that comment?
A Which one, sir?
Q The mahirap intubate ito assuming that you (interrupted)
A Iyon lang, that is what I only said mahirap intubate (interrupted)
Q At what point?
A When the first attempt when I inserted the laryngoscope for the first time.
Q So, when you claim that at the first attempt you inserted the laryngoscope, right?
A Yes.
Q But in one of the recordings somewhere at the, somewhere in the transcript of records that
when the lawyer of the other party try to inquire from you during the first attempt that was the
time when mayroon ba kayong hinugot sa tube, I do not remember the page now, but it seems to
me it is there. So, that it was on the second attempt that (interrupted)
A I was able to intubate.
Q And this is more or less about what time 12:21?
A Maybe, I cannot remember the time, Sir.
Q Okay, assuming that this was done at 12:21 and looking at the anesthesia records from 12:20
to 12:30 there was no recording of the vital signs. And can we presume that at this stage there
was already some problems in handling the patient?
A Not yet.
Q But why are there no recordings in the anesthesia record?
A I did not have time.
Q Ah, you did not have time, why did you not have time?
A Because it was so fast, I really (at this juncture the witness is laughing)
Q No, I am just asking. Remember I am not here not to pin point on anybody I am here just to
more or less clarify certainty more ore less on the record.
A Yes, Sir.
Q And so it seems that there were no recording during that span of ten (10) minutes. From 12:20
to 12:30, and going over your narration, it seems to me that the cyanosis appeared ten (10)
minutes after induction, is that right?
A Yes.
Q And that is after induction 12:15 that is 12:25 that was the first cyanosis?
A Yes.
Q And that the 12:25 is after the 12:20?
A We cannot (interrupted)
Q Huwag ho kayong makuwan, we are just trying to enlighten, I am just going over the record
ano, kung mali ito kuwan eh di ano. So, ganoon po ano, that it seems to me that there is no
recording from 12:20 to 12:30, so, I am just wondering why there were no recordings during the
period and then of course the second cyanosis, after the first cyanosis. I think that was the time
Dr. Hosaka came in?
A No, the first cyanosis (interrupted).[23]
We cannot thus give full credence to Dr. Gutierrez synopsis in light of her admission that it does
not fully reflect the events that transpired during the administration of anesthesia on Erlinda. As
pointed out by Dr. Estrella, there was a ten-minute gap in Dr. Gutierrez synopsis, i.e., the vital
signs of Erlinda were not recorded during that time. The absence of these data is particularly

significant because, as found by the trial court, it was the absence of oxygen supply for four (4)
to five (5) minutes that caused Erlindas comatose condition.
On the other hand, the Court has no reason to disbelieve the testimony of Cruz. As we stated in
the Decision, she is competent to testify on matters which she is capable of observing such as,
the statements and acts of the physician and surgeon, external appearances and manifest
conditions which are observable by any one.[24] Cruz, Erlindas sister-in-law, was with her
inside the operating room.Moreover, being a nurse and Dean of the Capitol Medical Center
School of Nursing at that, she is not entirely ignorant of anesthetic procedure. Cruz narrated that
she heard Dr. Gutierrez remark, Ang hirap ma-intubate nito, mali yata ang pagkakapasok. O
lumalaki ang tiyan. She observed that the nailbeds of Erlinda became bluish and thereafter
Erlinda was placed in trendelenburg position.[25] Cruz further averred that she noticed that the
abdomen of Erlinda became distended.[26]
The cyanosis (bluish discoloration of the skin or mucous membranes caused by lack of oxygen
or abnormal hemoglobin in the blood) and enlargement of the stomach of Erlinda indicate that
the endotracheal tube was improperly inserted into the esophagus instead of the trachea.
Consequently, oxygen was delivered not to the lungs but to the gastrointestinal tract. This
conclusion is supported by the fact that Erlinda was placed in trendelenburg position. This
indicates that there was a decrease of blood supply to the patients brain. The brain was thus
temporarily deprived of oxygen supply causing Erlinda to go into coma.
The injury incurred by petitioner Erlinda does not normally happen absent any negligence in the
administration of anesthesia and in the use of an endotracheal tube. As was noted in our
Decision, the instruments used in the administration of anesthesia, including the endotracheal
tube, were all under the exclusive control of private respondents Dr. Gutierrez and Dr. Hosaka.
[27] In Voss vs. Bridwell,[28]which involved a patient who suffered brain damage due to the
wrongful administration of anesthesia, and even before the scheduled mastoid operation could
be performed, the Kansas Supreme Court applied the doctrine of res ipsa loquitur, reasoning that
the injury to the patient therein was one which does not ordinarily take place in the absence of
negligence in the administration of an anesthetic, and in the use and employment of an
endotracheal tube. The court went on to say that [o]rdinarily a person being put under anesthesia
is not rendered decerebrate as a consequence of administering such anesthesia in the absence of
negligence. Upon these facts and under these circumstances, a layman would be able to say, as a
matter of common knowledge and observation, that the consequences of professional treatment
were not as such as would ordinarily have followed if due care had been exercised.[29]
Considering the application of the doctrine of res ipsa loquitur, the testimony of Cruz was
properly given credence in the case at bar.
For his part, Dr. Hosaka mainly contends that the Court erred in finding him negligent as a
surgeon by applying the Captain-of-the-Ship doctrine.[30] Dr. Hosaka argues that the trend in
United States jurisprudence has been to reject said doctrine in light of the developments in
medical practice. He points out that anesthesiology and surgery are two distinct and specialized
fields in medicine and as a surgeon, he is not deemed to have control over the acts of Dr.
Gutierrez. As anesthesiologist, Dr. Gutierrez is a specialist in her field and has acquired skills
and knowledge in the course of her training which Dr. Hosaka, as a surgeon, does not possess.
[31] He states further that current American jurisprudence on the matter recognizes that the trend
towards specialization in medicine has created situations where surgeons do not always have the
right to control all personnel within the operating room,[32] especially a fellow specialist.[33]
Dr. Hosaka cites the case of Thomas v. Raleigh General Hospital,[34] which involved a suit filed
by a patient who lost his voice due to the wrongful insertion of the endotracheal tube preparatory
to the administration of anesthesia in connection with the laparotomy to be conducted on him.
The patient sued both the anesthesiologist and the surgeon for the injury suffered by him. The
Supreme Court of Appeals of West Virginia held that the surgeon could not be held liable for the
loss of the patients voice, considering that the surgeon did not have a hand in the intubation of
the patient. The court rejected the application of the Captain-of-the-Ship Doctrine, citing the fact
that the field of medicine has become specialized such that surgeons can no longer be deemed as

having control over the other personnel in the operating room. It held that [a]n assignment of
liability based on actual control more realistically reflects the actual relationship which exists in
a modern operating room.[35] Hence, only the anesthesiologist who inserted the endotracheal
tube into the patients throat was held liable for the injury suffered by the latter.
This contention fails to persuade.
That there is a trend in American jurisprudence to do away with the Captain-of-the-Ship doctrine
does not mean that this Court will ipso facto follow said trend. Due regard for the peculiar
factual circumstances obtaining in this case justify the application of the Captain-of-the-Ship
doctrine. From the facts on record it can be logically inferred that Dr. Hosaka exercised a certain
degree of, at the very least, supervision over the procedure then being performed on Erlinda.
First, it was Dr. Hosaka who recommended to petitioners the services of Dr. Gutierrez. In effect,
he represented to petitioners that Dr. Gutierrez possessed the necessary competence and skills.
Drs. Hosaka and Gutierrez had worked together since 1977. Whenever Dr. Hosaka performed a
surgery, he would always engage the services of Dr. Gutierrez to administer the anesthesia on his
patient.[36]
Second, Dr. Hosaka himself admitted that he was the attending physician of Erlinda. Thus, when
Erlinda showed signs of cyanosis, it was Dr. Hosaka who gave instructions to call for another
anesthesiologist and cardiologist to help resuscitate Erlinda.[37]
Third, it is conceded that in performing their responsibilities to the patient, Drs. Hosaka and
Gutierrez worked as a team. Their work cannot be placed in separate watertight compartments
because their duties intersect with each other.[38]
While the professional services of Dr. Hosaka and Dr. Gutierrez were secured primarily for their
performance of acts within their respective fields of expertise for the treatment of petitioner
Erlinda, and that one does not exercise control over the other, they were certainly not completely
independent of each other so as to absolve one from the negligent acts of the other physician.
That they were working as a medical team is evident from the fact that Dr. Hosaka was keeping
an eye on the intubation of the patient by Dr. Gutierrez, and while doing so, he observed that the
patients nails had become dusky and had to call Dr. Gutierrezs attention thereto. The Court also
notes that the counsel for Dr. Hosaka admitted that in practice, the anesthesiologist would also
have to observe the surgeons acts during the surgical process and calls the attention of the
surgeon whenever necessary[39] in the course of the treatment. The duties of Dr. Hosaka and
those of Dr. Gutierrez in the treatment of petitioner Erlinda are therefore not as clear-cut as
respondents claim them to be. On the contrary, it is quite apparent that they have a common
responsibility to treat the patient, which responsibility necessitates that they call each others
attention to the condition of the patient while the other physician is performing the necessary
medical procedures.
It is equally important to point out that Dr. Hosaka was remiss in his duty of attending to
petitioner Erlinda promptly, for he arrived more than three (3) hours late for the scheduled
operation. Thecholecystectomy was set for June 17, 1985 at 9:00 a.m., but he arrived at DLSMC
only at around 12:10 p.m. In reckless disregard for his patients well being, Dr. Hosaka scheduled
two procedures on the same day, just thirty minutes apart from each other, at different hospitals.
Thus, when the first procedure (protoscopy) at the Sta. Teresita Hospital did not proceed on
time, Erlinda was kept in a state of uncertainty at the DLSMC.
The unreasonable delay in petitioner Erlindas scheduled operation subjected her to continued
starvation and consequently, to the risk of acidosis,[40] or the condition of decreased alkalinity
of the blood and tissues, marked by sickly sweet breath, headache, nausea and vomiting, and
visual disturbances.[41] The long period that Dr. Hosaka made Erlinda wait for him certainly
aggravated the anxiety that she must have been feeling at the time. It could be safely said that
her anxiety adversely affected the administration of anesthesia on her. As explained by Dr.
Camagay, the patients anxiety usually causes the outpouring of adrenaline which in turn results
in high blood pressure or disturbances in the heart rhythm:
DR. CAMAGAY:

x x x Pre-operative medication has three main functions: One is to alleviate anxiety. Second is to
dry up the secretions and Third is to relieve pain. Now, it is very important to alleviate anxiety
because anxiety is associated with the outpouring of certain substances formed in the body
called adrenalin. When a patient is anxious there is an outpouring of adrenalin which would have
adverse effect on the patient. One of it is high blood pressure, the other is that he opens himself
to disturbances in the heart rhythm, which would have adverse implications. So, we would like
to alleviate patients anxiety mainly because he will not be in control of his body there could be
adverse results to surgery and he will be opened up; a knife is going to open up his body. x x
x[42]
Dr. Hosaka cannot now claim that he was entirely blameless of what happened to Erlinda. His
conduct clearly constituted a breach of his professional duties to Erlinda:
CHIEF JUSTICE:
Two other points. The first, Doctor, you were talking about anxiety, would you consider a
patient's stay on the operating table for three hours sufficient enough to aggravate or magnify his
or her anxiety?
DR. CAMAGAY:
Yes.
CHIEF JUSTICE:
In other words, I understand that in this particular case that was the case, three hours waiting and
the patient was already on the operating table (interrupted)
DR. CAMAGAY:
Yes.
CHIEF JUSTICE:
Would you therefore conclude that the surgeon contributed to the aggravation of the anxiety of
the patient?
DR. CAMAGAY:
That this operation did not take place as scheduled is already a source of anxiety and most
operating tables are very narrow and that patients are usually at risk of falling on the floor so
there are restraints that are placed on them and they are never, never left alone in the operating
room by themselves specially if they are already pre-medicated because they may not be aware
of some of their movement that they make which would contribute to their injury.
CHIEF JUSTICE:
In other words due diligence would require a surgeon to come on time?
DR. CAMAGAY:
I think it is not even due diligence it is courtesy.
CHIEF JUSTICE:
Courtesy.
DR. CAMAGAY:
And care.
CHIEF JUSTICE:
Duty as a matter of fact?
DR. CAMAGAY:
Yes, Your Honor.[43]
Dr. Hosaka's irresponsible conduct of arriving very late for the scheduled operation of petitioner
Erlinda is violative, not only of his duty as a physician to serve the interest of his patients with
the greatest solicitude, giving them always his best talent and skill,[44] but also of Article 19 of
the Civil Code which requires a person, in the performance of his duties, to act with justice and
give everyone his due.
Anent private respondent DLSMCs liability for the resulting injury to petitioner Erlinda, we held
that respondent hospital is solidarily liable with respondent doctors therefor under Article 2180
of the Civil Code[45] since there exists an employer-employee relationship between private
respondent DLSMC and Drs. Gutierrez and Hosaka:

In other words, private hospitals, hire, fire and exercise real control over their attending and
visiting consultant staff. While consultants are not, technically employees, x x x the control
exercised, the hiring and the right to terminate consultants all fulfill the important hallmarks of
an employer-employee relationship, with the exception of the payment of wages. In assessing
whether such a relationship in fact exists, the control test is determining. x x x[46]
DLSMC however contends that applying the four-fold test in determining whether such a
relationship exists between it and the respondent doctors, the inescapable conclusion is that
DLSMC cannot be considered an employer of the respondent doctors.
It has been consistently held that in determining whether an employer-employee relationship
exists between the parties, the following elements must be present: (1) selection and engagement
of services; (2) payment of wages; (3) the power to hire and fire; and (4) the power to control
not only the end to be achieved, but the means to be used in reaching such an end.[47]
DLSMC maintains that first, a hospital does not hire or engage the services of a consultant, but
rather, accredits the latter and grants him or her the privilege of maintaining a clinic and/or
admitting patients in the hospital upon a showing by the consultant that he or she possesses the
necessary qualifications, such as accreditation by the appropriate board (diplomate), evidence of
fellowship and references.[48]Second, it is not the hospital but the patient who pays the
consultants fee for services rendered by the latter.[49] Third, a hospital does not dismiss a
consultant; instead, the latter may lose his or her accreditation or privileges granted by the
hospital.[50] Lastly, DLSMC argues that when a doctor refers a patient for admission in a
hospital, it is the doctor who prescribes the treatment to be given to said patient. The hospitals
obligation is limited to providing the patient with the preferred room accommodation, the
nutritional diet and medications prescribed by the doctor, the equipment and facilities necessary
for the treatment of the patient, as well as the services of the hospital staff who perform the
ministerial tasks of ensuring that the doctors orders are carried out strictly.[51]
After a careful consideration of the arguments raised by DLSMC, the Court finds that
respondent hospitals position on this issue is meritorious. There is no employer-employee
relationship between DLSMC and Drs. Gutierrez and Hosaka which would hold DLSMC
solidarily liable for the injury suffered by petitioner Erlinda under Article 2180 of the Civil
Code.
As explained by respondent hospital, that the admission of a physician to membership in
DLSMCs medical staff as active or visiting consultant is first decided upon by the Credentials
Committee thereof, which is composed of the heads of the various specialty departments such as
the Department of Obstetrics and Gynecology, Pediatrics, Surgery with the department head of
the particular specialty applied for as chairman. The Credentials Committee then recommends to
DLSMC's Medical Director or Hospital Administrator the acceptance or rejection of the
applicant physician, and said director or administrator validates the committee's
recommendation.[52] Similarly, in cases where a disciplinary action is lodged against a
consultant, the same is initiated by the department to whom the consultant concerned belongs
and filed with the Ethics Committee consisting of the department specialty heads. The medical
director/hospital administrator merely acts as ex-officio member of said committee.
Neither is there any showing that it is DLSMC which pays any of its consultants for medical
services rendered by the latter to their respective patients. Moreover, the contract between the
consultant in respondent hospital and his patient is separate and distinct from the contract
between respondent hospital and said patient. The first has for its object the rendition of medical
services by the consultant to the patient, while the second concerns the provision by the hospital
of facilities and services by its staff such as nurses and laboratory personnel necessary for the
proper treatment of the patient.
Further, no evidence was adduced to show that the injury suffered by petitioner Erlinda was due
to a failure on the part of respondent DLSMC to provide for hospital facilities and staff
necessary for her treatment.
For these reasons, we reverse the finding of liability on the part of DLSMC for the injury
suffered by petitioner Erlinda.

Finally, the Court also deems it necessary to modify the award of damages to petitioners in view
of the supervening event of petitioner Erlindas death. In the assailed Decision, the Court
awarded actual damages of One Million Three Hundred Fifty Two Thousand Pesos
(P1,352,000.00) to cover the expenses for petitioner Erlindas treatment and care from the date of
promulgation of the Decision up to the time the patient expires or survives.[53] In addition
thereto, the Court awarded temperate damages of One Million Five Hundred Thousand Pesos
(P1,500,000.00) in view of the chronic and continuing nature of petitioner Erlindas injury and
the certainty of further pecuniary loss by petitioners as a result of said injury, the amount of
which, however, could not be made with certainty at the time of the promulgation of the
decision. The Court justified such award in this manner:
Our rules on actual or compensatory damages generally assume that at the time of litigation, the
injury suffered as a consequence of an act of negligence has been completed and that the cost
can be liquidated.However, these provisions neglect to take into account those situations, as in
this case, where the resulting injury might be continuing and possible future complications
directly arising from the injury, while certain to occur, are difficult to predict.
In these cases, the amount of damages which should be awarded, if they are to adequately and
correctly respond to the injury caused, should be one which compensates for pecuniary loss
incurred and proved, up to the time of trial; and one which would meet pecuniary loss certain to
be suffered but which could not, from the nature of the case, be made with certainty. In other
words, temperate damages can and should be awarded on top of actual or compensatory
damages in instances where the injury is chronic and continuing. And because of the unique
nature of such cases, no incompatibility arises when both actual and temperate damages are
provided for. The reason is that these damages cover two distinct phases.
As it would not be equitableand certainly not in the best interests of the administration of
justicefor the victim in such cases to constantly come before the courts and invoke their aid in
seeking adjustments to the compensatory damages previously awardedtemperate damages are
appropriate. The amount given as temperate damages, though to a certain extent speculative,
should take into account the cost of proper care.
In the instant case, petitioners were able to provide only home-based nursing care for a comatose
patient who has remained in that condition for over a decade. Having premised our award for
compensatory damages on the amount provided by petitioners at the onset of litigation, it would
be now much more in step with the interests of justice if the value awarded for temperate
damages would allow petitioners to provide optimal care for their loved one in a facility which
generally specializes in such care. They should not be compelled by dire circumstances to
provide substandard care at home without the aid of professionals, for anything less would be
grossly inadequate. Under the circumstances, an award of P1,500,000.00 in temperate damages
would therefore be reasonable.[54]
However, subsequent to the promulgation of the Decision, the Court was informed by petitioner
Rogelio that petitioner Erlinda died on August 3, 1999.[55] In view of this supervening event,
the award of temperate damages in addition to the actual or compensatory damages would no
longer be justified since the actual damages awarded in the Decision are sufficient to cover the
medical expenses incurred by petitioners for the patient. Hence, only the amounts representing
actual, moral and exemplary damages, attorneys fees and costs of suit should be awarded to
petitioners.
WHEREFORE, the assailed Decision is hereby modified as follows:
(1) Private respondent De Los Santos Medical Center is hereby absolved from liability arising
from the injury suffered by petitioner Erlinda Ramos on June 17, 1985;
(2) Private respondents Dr. Orlino Hosaka and Dr. Perfecta Gutierrez are hereby declared to be
solidarily liable for the injury suffered by petitioner Erlinda on June 17, 1985 and are ordered to
pay petitioners
(a) P1,352,000.00 as actual damages;
(b) P2,000,000.00 as moral damages;
(c) P100,000.00 as exemplary damages;

(d) P100,000.00 as attorneys fees; and


(e) the costs of the suit.
SO ORDERED.
February 18, 1915
G.R. No. L-9356
C. S. GILCHRIST, plaintiff-appellee,
vs.
E. A. CUDDY, ET AL., defendants. JOSE FERNANDEZ ESPEJO and MARIANO
ZALDARRIAGA, appellants.
C. Lozano for appellants. Bruce, Lawrence, Ross and Block for appellee.
TRENT, J.:
An appeal by the defendants, Jose Fernandez Espejo and Mariano Zaldarriaga, from a judgment
of the Court of First Instance of Iloilo, dismissing their cross-complaint upon the merits for
damages against the plaintiff for the alleged wrongful issuance of a mandatory and a preliminary
injunction.

Upon the application of the appellee an ex parte mandatory injunction was issued on the 22d of
May, 1913, directing the defendant, E. A. Cuddy, to send to the appellee a certain cinematograph
film called "Zigomar" in compliance with an alleged contract which had been entered into
between these two parties, and at the time an ex parte preliminary injunction was issued
restraining the appellants from receiving and exhibiting in their theater the Zigomar until further
orders of the court. On the 26th of that month the appellants appeared and moved the court to
dissolve the preliminary injunction. When the case was called for trial on August 6, the appellee
moved for the dismissal of the complaint "for the reason that there is no further necessity for the
maintenance of the injunction." The motion was granted without objection as to Cuddy and
denied as to the appellants in order to give them an opportunity to prove that the injunction were
wrongfully issued and the amount of damages suffered by reason thereof.
The pertinent part of the trial court's findings of fact in this case is as follows:
It appears in this case that Cuddy was the owner of the film Zigomar and that on the 24th of
April he rented it to C. S. Gilchrist for a week for P125, and it was to be delivered on the 26th of
May, the week beginning that day. A few days prior to this Cuddy sent the money back to
Gilchrist, which he had forwarded to him in Manila, saying that he had made other arrangements
with his film. The other arrangements was the rental to these defendants Espejo and his partner
for P350 for the week and the injunction was asked by Gilchrist against these parties from
showing it for the week beginning the 26th of May.
It appears from the testimony in this case, conclusively, that Cuddy willfully violated his
contract, he being the owner of the picture, with Gilchrist because the defendants had offered
him more for the same period. Mr. Espejo at the trial on the permanent injunction on the 26th of
May admitted that he knew that Cuddy was the owner of the film. He was trying to get it
through his agents Pathe Brothers in Manila. He is the agent of the same concern in Iloilo. There
is in evidence in this case on the trial today as well as on the 26th of May, letters showing that
the Pathe Brothers in Manila advised this man on two different occasions not to contend for this

film Zigomar because the rental price was prohibitive and assured him also that he could not get
the film for about six weeks. The last of these letters was written on the 26th of April, which
showed conclusively that he knew they had to get this film from Cuddy and from this letter that
the agent in Manila could not get it, but he made Cuddy an offer himself and Cuddy accepted it
because he was paying about three times as much as he had contracted with Gilchrist for.
Therefore, in the opinion of this court, the defendants failed signally to show the injunction
against the defendant was wrongfully procured.
The appellants duly excepted to the order of the court denying their motion for new trial on the
ground that the evidence was insufficient to justify the decision rendered. There is lacking from
the record before us the deposition of the defendant Cuddy, which apparently throws light upon
a contract entered into between him and the plaintiff Gilchrist. The contents of this deposition
are discussed at length in the brief of the appellants and an endeavor is made to show that no
such contract was entered into. The trial court, which had this deposition before it, found that
there was a contract between Cuddy and Gilchrist. Not having the deposition in question before
us, it is impossible to say how strongly it militates against this findings of fact. By a series of
decisions we have construed section 143 and 497 (2) of the Code of Civil Procedure to require
the production of all the evidence in this court. This is the duty of the appellant and, upon his
failure to perform it, we decline to proceed with a review of the evidence. In such cases we rely
entirely upon the pleadings and the findings of fact of the trial court and examine only such
assigned errors as raise questions of law. (Ferrer vs. Neri Abejuela, 9 Phil. Rep., 324; Valle vs.
Galera, 10 Phil. Rep., 619; Salvacion vs. Salvacion, 13 Phil. Rep., 366; Breta vs. Smith, Bell &
Co., 15 Phil. Rep., 446; Arroyo vs. Yulo, 18 Phil. Rep., 236; Olsen & Co. vs. Matson, Lord &
Belser Co., 19 Phil. Rep., 102; Blum vs. Barretto, 19 Phil. Rep., 161; Cuyugan vs. Aguas, 19
Phil. Rep., 379; Mapa vs. Chaves, 20 Phil. Rep., 147; Mans vs. Garry, 20 Phil. Rep., 134.) It is
true that some of the more recent of these cases make exceptions to the general rule. Thus, in
Olsen & Co. vs. Matson, Lord & Belser Co., (19 Phil. Rep., 102), that portion of the evidence
before us tended to show that grave injustice might result from a strict reliance upon the findings
of fact contained in the judgment appealed from. We, therefore, gave the appellant an
opportunity to explain the omission. But we required that such explanation must show a
satisfactory reason for the omission, and that the missing portion of the evidence must be
submitted within sixty days or cause shown for failing to do so. The other cases making
exceptions to the rule are based upon peculiar circumstances which will seldom arise in practice
and need not here be set forth, for the reason that they are wholly inapplicable to the present
case. The appellants would be entitled to indulgence only under the doctrine of the Olsen case.
But from that portion of the record before us, we are not inclined to believe that the missing
deposition would be sufficient to justify us in reversing the findings of fact of the trial court that
the contract in question had been made. There is in the record not only the positive and detailed
testimony of Gilchrist to this effect, but there is also a letter of apology from Cuddy to Gilchrist
in which the former enters into a lengthy explanation of his reasons for leasing the film to
another party. The latter could only have been called forth by a broken contract with Gilchrist to
lease the film to him. We, therefore, fail to find any reason for overlooking the omission of the
defendants to bring up the missing portion of the evidence and, adhering to the general rule
above referred to, proceed to examine the questions of law raised by the appellants.
From the above-quoted findings of fact it is clear that Cuddy, a resident of Manila, was the
owner of the "Zigomar;" that Gilchrist was the owner of a cinematograph theater in Iloilo; that
in accordance with the terms of the contract entered into between Cuddy and Gilchrist the
former leased to the latter the "Zigomar" for exhibition in his (Gilchrist's) theater for the week
beginning May 26, 1913; and that Cuddy willfully violate his contract in order that he might
accept the appellant's offer of P350 for the film for the same period. Did the appellants know
that they were inducing Cuddy to violate his contract with a third party when they induced him

to accept the P350? Espejo admitted that he knew that Cuddy was the owner of the film. He
received a letter from his agents in Manila dated April 26, assuring him that he could not get the
film for about six weeks. The arrangement between Cuddy and the appellants for the exhibition
of the film by the latter on the 26th of May were perfected after April 26, so that the six weeks
would include and extend beyond May 26. The appellants must necessarily have known at the
time they made their offer to Cuddy that the latter had booked or contracted the film for six
weeks from April 26. Therefore, the inevitable conclusion is that the appellants knowingly
induced Cuddy to violate his contract with another person. But there is no specific finding that
the appellants knew the identity of the other party. So we must assume that they did not know
that Gilchrist was the person who had contracted for the film.

The appellants take the position that if the preliminary injunction had not been issued against
them they could have exhibited the film in their theater for a number of days beginning May 26,
and could have also subleased it to other theater owners in the nearby towns and, by so doing,
could have cleared, during the life of their contract with Cuddy, the amount claimed as damages.
Taking this view of the case, it will be unnecessary for us to inquire whether the mandatory
injunction against Cuddy was properly issued or not. No question is raised with reference to the
issuance of that injunction.
The right on the part of Gilchrist to enter into a contract with Cuddy for the lease of the film
must be fully recognized and admitted by all. That Cuddy was liable in an action for damages
for the breach of that contract, there can be no doubt. Were the appellants likewise liable for
interfering with the contract between Gilchrist and Cuddy, they not knowing at the time the
identity of one of the contracting parties? The appellants claim that they had a right to do what
they did. The ground upon which the appellants base this contention is, that there was no valid
and binding contract between Cuddy and Gilchrist and that, therefore, they had a right to
compete with Gilchrist for the lease of the film, the right to compete being a justification for
their acts. If there had been no contract between Cuddy and Gilchrist this defense would be
tenable, but the mere right to compete could not justify the appellants in intentionally inducing
Cuddy to take away the appellee's contractual rights.
Chief Justice Wells in Walker vs. Cronin (107 Mass., 555), said: "Everyone has a right to enjoy
the fruits and advantages of his own enterprise, industry, skill and credit. He has no right to be
free from malicious and wanton interference, disturbance or annoyance. If disturbance or loss
come as a result of competition, or the exercise of like rights by others, it is damnum absque
injuria, unless some superior right by contract or otherwise is interfered with."
In Read vs. Friendly Society of Operative Stonemasons ([1902] 2 K. B., 88), Darling, J., said: "I
think the plaintiff has a cause of action against the defendants, unless the court is satisfied that,
when they interfered with the contractual rights of plaintiff, the defendants had a sufficient
justification for their interference; . . . for it is not a justification that `they acted bona fide in the
best interests of the society of masons,' i. e., in their own interests. Nor is it enough that `they
were not actuated by improper motives.' I think their sufficient justification for interference with
plaintiff's right must be an equal or superior right in themselves, and that no one can legally
excuse himself to a man, of whose contract he has procured the breach, on the ground that he
acted on a wrong understanding of his own rights, or without malice, or bona fide, or in the best
interests of himself, or even that he acted as an altruist, seeking only good of another and
careless of his own advantage." (Quoted with approval in Beekman vs. Marsters, 195 Mass.,
205.)

It is said that the ground on which the liability of a third party for interfering with a contract
between others rests, is that the interference was malicious. The contrary view, however, is taken
by the Supreme Court of the United States in the case of Angle vs. Railway Co. (151 U. S., 1).
The only motive for interference by the third party in that case was the desire to make a profit to
the injury of one of the parties of the contract. There was no malice in the case beyond the desire
to make an unlawful gain to the detriment of one of the contracting parties.

In the case at bar the only motive for the interference with the Gilchrist - Cuddy contract on the
part of the appellants was a desire to make a profit by exhibiting the film in their theater. There
was no malice beyond this desire; but this fact does not relieve them of the legal liability for
interfering with that contract and causing its breach. It is, therefore, clear, under the above
authorities, that they were liable to Gilchrist for the damages caused by their acts, unless they
are relieved from such liability by reason of the fact that they did not know at the time the
identity of the original lessee (Gilchrist) of the film.
The liability of the appellants arises from unlawful acts and not from contractual obligations, as
they were under no such obligations to induce Cuddy to violate his contract with Gilchrist. So
that if the action of Gilchrist had been one for damages, it would be governed by chapter 2, title
16, book 4 of the Civil Code. Article 1902 of that code provides that a person who, by act or
omission, causes damages to another when there is fault or negligence, shall be obliged to repair
the damage do done. There is nothing in this article which requires as a condition precedent to
the liability of a tort-feasor that he must know the identity of a person to whom he causes
damages. In fact, the chapter wherein this article is found clearly shows that no such knowledge
is required in order that the injured party may recover for the damage suffered.
But the fact that the appellants' interference with the Gilchrist contract was actionable did not of
itself entitle Gilchrist to sue out an injunction against them. The allowance of this remedy must
be justified under section 164 of the Code of Civil Procedure, which specifies the circumstance
under which an injunction may issue. Upon the general doctrine of injunction we said in Devesa
vs. Arbes (13 Phil. Rep., 273):
An injunction is a "special remedy" adopted in that code (Act No. 190 ) from American practice,
and originally borrowed from English legal procedure, which was there issued by the authority
and under the seal of a court of equity, and limited, as in order cases where equitable relief is
sought, to cases where there is no "plain, adequate, and complete remedy at law," which "will
not be granted while the rights between the parties are undetermined, except in extraordinary
cases where material and irreparable injury will be done," which cannot be compensated in
damages, and where there will be no adequate remedy, and which will not, as a rule, be granted,
to take property out of the possession of one party and put it into that of another whose title has
not been established by law.
We subsequently affirmed the doctrine of the Devesa case in Palafox vs. Madamba (19 Phil.,
Rep., 444), and we take this occasion of again affirming it, believing, as we do, that the
indiscriminate use of injunctions should be discouraged.
Does the fact that the appellants did not know at the time the identity of the original lessee of the
film militate against Gilchrist's right to a preliminary injunction, although the appellant's
incurred civil liability for damages for such interference? In the examination of the adjudicated

cases, where in injunctions have been issued to restrain wrongful interference with contracts by
strangers to such contracts, we have been unable to find any case where this precise question
was involved, as in all of those cases which we have examined, the identity of both of the
contracting parties was known to the tort-feasors. We might say, however, that this fact does not
seem to have a controlling feature in those cases. There is nothing in section 164 of the Code of
Civil Procedure which indicates, even remotely, that before an injunction may issue restraining
the wrongful interference with contrast by strangers, the strangers must know the identity of
both parties. It would seem that this is not essential, as injunctions frequently issue against
municipal corporations, public service corporations, public officers, and others to restrain the
commission of acts which would tend to injuriously affect the rights of person whose identity
the respondents could not possibly have known beforehand. This court has held that in a proper
case injunction will issue at the instance of a private citizen to restrain ultra vires acts of public
officials. (Severino vs. Governor-General, 16 Phil. Rep., 366.) So we proceed to the
determination of the main question of whether or not the preliminary injunction ought to have
been issued in this case.
As a rule, injunctions are denied to those who have an adequate remedy at law. Where the choice
is between the ordinary and the extraordinary processes of law, and the former are sufficient, the
rule will not permit the use of the latter. (In re Debs, 158 U. S., 564.) If the injury is irreparable,
the ordinary process is inadequate. In Wahle vs. Reinbach (76 Ill., 322), the supreme court of
Illinois approved a definition of the term "irreparable injury" in the following language: "By
`irreparable injury' is not meant such injury as is beyond the possibility of repair, or beyond
possible compensation in damages, nor necessarily great injury or great damage, but that species
of injury, whether great or small, that ought not to be submitted to on the one hand or inflicted
on the other; and, because it is so large on the one hand, or so small on the other, is of such
constant and frequent recurrence that no fair or reasonable redress can be had therefor in a court
of law." (Quoted with approval in Nashville R. R. Co. vs. McConnell, 82 Fed., 65.)
The case at bar is somewhat novel, as the only contract which was broken was that between
Cuddy and Gilchrist, and the profits of the appellee depended upon the patronage of the public,
for which it is conceded the appellants were at liberty to complete by all fair does not deter the
application of remarked in the case of the "ticket scalpers" (82 Fed., 65), the novelty of the facts
does not deter the application of equitable principles. This court takes judicial notice of the
general character of a cinematograph or motion-picture theater. It is a quite modern form of the
play house, wherein, by means of an apparatus known as a cinematograph or cinematograph, a
series of views representing closely successive phases of a moving object, are exhibited in rapid
sequence, giving a picture which, owing to the persistence of vision, appears to the observer to
be in continuous motion. (The Encyclopedia Britanica, vol. 6, p. 374.) The subjects which have
lent themselves to the art of the photographer in this manner have increased enormously in
recent years, as well as have the places where such exhibition are given. The attendance, and,
consequently, the receipts, at one of these cinematograph or motion-picture theaters depends in
no small degree upon the excellence of the photographs, and it is quite common for the
proprietor of the theater to secure an especially attractive exhibit as his "feature film" and
advertise it as such in order to attract the public. This feature film is depended upon to secure a
larger attendance that if its place on the program were filled by other films of mediocre quality.
It is evident that the failure to exhibit the feature film will reduce the receipts of the theater.
Hence, Gilchrist was facing the immediate prospect of diminished profits by reason of the fact
that the appellants had induced Cuddy to rent to them the film Gilchrist had counted upon as his
feature film. It is quite apparent that to estimate with any decree of accuracy the damages which
Gilchrist would likely suffer from such an event would be quite difficult if not impossible. If he
allowed the appellants to exhibit the film in Iloilo, it would be useless for him to exhibit it again,

as the desire of the public to witness the production would have been already satisfied. In this
extremity, the appellee applied for and was granted, as we have indicated, a mandatory
injunction against Cuddy requiring him to deliver the Zigomar to Gilchrist, and a preliminary
injunction against the appellants restraining them from exhibiting that film in their theater during
the weeks he (Gilchrist) had a right to exhibit it. These injunction saved the plaintiff harmless
from damages due to the unwarranted interference of the defendants, as well as the difficult task
which would have been set for the court of estimating them in case the appellants had been
allowed to carry out their illegal plans. As to whether or not the mandatory injunction should
have been issued, we are not, as we have said, called upon to determine. So far as the
preliminary injunction issued against the appellants is concerned, which prohibited them from
exhibiting the Zigomar during the week which Gilchrist desired to exhibit it, we are of the
opinion that the circumstances justified the issuance of that injunction in the discretion of the
court.
We are not lacking in authority to support our conclusion that the court was justified in issuing
the preliminary injunction against the appellants. Upon the precise question as to whether
injunction will issue to restrain wrongful interference with contracts by strangers to such
contracts, it may be said that courts in the United States have usually granted such relief where
the profits of the injured person are derived from his contractual relations with a large and
indefinite number of individuals, thus reducing him to the necessity of proving in an action
against the tort-feasor that the latter was responsible in each case for the broken contract, or else
obliging him to institute individual suits against each contracting party and so exposing him to a
multiplicity of suits. Sperry & Hutchinson Co. vs. Mechanics' Clothing Co. (128 Fed., 800);
Sperry & Hutchinson Co. vs. Louis Weber & Co. (161 Fed., 219); Sperry & Hutchinson Co. vs.
Pommer (199 Fed., 309); were all cases wherein the respondents were inducing retail merchants
to break their contracts with the company for the sale of the latters' trading stamps. Injunction
issued in each case restraining the respondents from interfering with such contracts.
In the case of the Nashville R. R. Co. vs. McConnell (82 Fed., 65), the court, among other
things, said: "One who wrongfully interferes in a contract between others, and, for the purpose
of gain to himself induces one of the parties to break it, is liable to the party injured thereby; and
his continued interference may be ground for an injunction where the injuries resulting will be
irreparable."
In Hamby & Toomer vs. Georgia Iron & Coal Co. (127 Ga., 792), it appears that the respondents
were interfering in a contract for prison labor, and the result would be, if they were successful,
the shutting down of the petitioner's plant for an indefinite time. The court held that although
there was no contention that the respondents were insolvent, the trial court did not abuse its
discretion in granting a preliminary injunction against the respondents.
In Beekman vs. Marsters (195 Mass., 205), the plaintiff had obtained from the Jamestown Hotel
Corporation, conducting a hotel within the grounds of the Jamestown Exposition, a contract
whereby he was made their exclusive agent for the New England States to solicit patronage for
the hotel. The defendant induced the hotel corporation to break their contract with the plaintiff in

order to allow him to act also as their agent in the New England States. The court held that an
action for damages would not have afforded the plaintiff adequate relief, and that an injunction
was proper compelling the defendant to desist from further interference with the plaintiff's
exclusive contract with the hotel company.

In Citizens' Light, Heat & Power Co. vs. Montgomery Light & Water Power Co. (171 Fed.,
553), the court, while admitting that there are some authorities to the contrary, held that the
current authority in the United States and England is that:
The violation of a legal right committed knowingly is a cause of action, and that it is a violation
of a legal right to interfere with contractual relations recognized by law, if there be no sufficient
justification for the interference. (Quinn vs. Leatham, supra, 510; Angle vs. Chicago, etc., Ry.
Co., 151 U. S., 1; 14 Sup. Ct., 240; 38 L. Ed., 55; Martens vs. Reilly, 109 Wis., 464, 84 N. W.,
840; Rice vs. Manley, 66 N. Y., 82; 23 Am. Rep., 30; Bitterman vs. L. & N. R. R. Co., 207 U. S.,
205; 28 Sup. Ct., 91; 52 L. Ed., 171; Beekman vs. Marsters, 195 Mass., 205; 80 N. E., 817; 11 L.
R. A. [N. S.] 201; 122 Am. St. Rep., 232; South Wales Miners' Fed. vs. Glamorgan Coal Co.,
Appeal Cases, 1905, p. 239.)
See also Nims on Unfair Business Competition, pp. 351- 371.
In 3 Elliot on Contracts, section 2511, it is said: "Injunction is the proper remedy to prevent a
wrongful interference with contract by strangers to such contracts where the legal remedy is
insufficient and the resulting injury is irreparable. And where there is a malicious interference
with lawful and valid contracts a permanent injunction will ordinarily issue without proof of
express malice. So, an injunction may be issued where the complainant to break their contracts
with him by agreeing to indemnify who breaks his contracts of employment may be adjoined
from including other employees to break their contracts and enter into new contracts with a new
employer of the servant who first broke his contract. But the remedy by injunction cannot be
used to restrain a legitimate competition, though such competition would involve the violation
of a contract. Nor will equity ordinarily enjoin employees who have quit the service of their
employer from attempting by proper argument to persuade others from taking their places so
long as they do not resort to force or intimidations on obstruct the public thoroughfares."
Beekman vs. Marster, supra, is practically on all fours with the case at bar in that there was only
one contract in question and the profits of the injured person depended upon the patronage of the
public. Hamby & Toomer vs. Georgia Iron & Coal Co., supra, is also similar to the case at bar in
that there was only one contract, the interference of which was stopped by injunction.

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