I.

A.

Persons Vicariously Liable

Persons Exercising Parental Authority

1.

Parents

LIBI VS IAC
G.R. No. 70890 September 18 1992
FACTS: Wendell Libi shot his lover Julie Ann Giotong, both minors, before he turned the firearm on himself. As a
result, the parents of Julie Ann filed against Wendell's parents to recover damages. The trial court rendered
judgment dismissing the complaint for insufficiency of evidence. CA reversed the decision.
ISSUE: Whether or not the parents of Wendell Libi liable for vicarious liability.
RULING: Yes. The subsidiary liability of parents for damages cause by their minor children is imposed by Article
2180 of the New Civil Code, which covers obligations arising from both quasi-delicts and criminal offenses. The
parents' liability as being primary and not subsidiary and liability shall ceased if the parents can prove that they
observe all the diligence of a good father to prevent damage.
In this case, the parents had not exercised due diligence in supervising the activities of their son. It was only at the
time of Wendell's death that they allegedly discovered that he was drug informant of CANU and that the gun used
in the shooting incident was missing from the safety deposit box. Having been grossly negligent in preventing
Wendell from having access to said gun, the Libis are subsidiary liable for the natural consequence of the criminal
act of said minor who was living in their company.

Libi vs. IAC

FACTS: Julie Ann Gotiong and Wendell Libi were a sweetheart until the former broke up with the latter after she
found out the Wendell was irresponsible and sadistic. Wendell wanted reconciliation but was not granted by Julie so
it prompted him to resort to threats. One day, there were found dead from a single gunshot wound each coming
from the same gun. The parents of Julie herein private respondents filed a civil case against the parents of Wendell
to recover damages. Trial court dismissed the complaint for insufficiency of evidence but was set aside by CA.
ISSUE: WON the parents should be held liable for such damages.
HELD: The subsidiary liability of parents for damages caused by their minor children imposed under Art 2180 of
the Civil Code and Art. 101 of Revised Penal Code covered obligations arising from both quasi-delicts and criminal
offenses. The court held that the civil liability of the parents for quasi-delict of their minor children is primary and
not subsidiary and that responsibility shall cease when the persons can prove that they observe all the diligence of
a good father of a family to prevent damage. However, Wendells mother testified that her husband owns a gun
which he kept in a safety deposit box inside a drawer in their bedroom. Each of the spouses had their own key. She
likewise admitted that during the incident, the gun was no longer in the safety deposit box. Wendell could not have
gotten hold of the gun unless the key was left negligently lying around and that he has free access of the mothers
bag where the key was kept. The spouses failed to observe and exercise the required diligence of a good father to
prevent such damage.

TAMARGO VS CA
G.R. No. 85044 June 3 1992
[Parental Authority]
FACTS: In October 1982, Adelberto Bundoc, a minor, shot and killed Jennifer Tamargo with an air rifle. Jennifer's
natural parents filed civil complaints for damages with the RTC against Bundoc's natural parents.
In December 1981, spouses Rapisura filed a petition to adopt Adelberto. The petition was granted in November
1982.
Adelberto's parents, in their Answer, claimed that the spouses Rapisura were indispensable parties to the action
since parental authority had shifted to them from the moment the petition for adoption was decreed. Spouses
Tamargo contended that since Adelberto was then actually living with his natural parents, parental authority had
not ceased by mere filing and granting of the petition for adoption. Trial court dismissed the spouses Tamargo's
petition.
ISSUE: Whether or not the spouses Rapisura are the indispensable parties to actions committed by Adelberto.

RULING: No. In Article 221 of the Family Code states that: "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 company and under their parental authority subject to the appropriate defences provided by
law." In the case at bar, parental authority over Adelberto was still lodged with the natural parents at the time the
shooting incident happened. It follows that the natural parents are the indispensable parties to the suit for
damages.
SC held that parental authority had not been retroactively transferred to and vested in the adopting parents, at the
time the shooting happened. It do not consider that retroactive effect may be given to the decree of the adoption so
as to impose a liability upon the adopting parents accruing at the time when adopting parents had no actual
custody over the adopted child. Retroactive affect may be essential if it permit the accrual of some benefit or
advantage in favor of the adopted child.

Tamargo vs CA
GR No. 85044, June 3, 1992
FACTS: In October 1982, Adelberto Bundoc, minor, 10 years of age, shot Jennifer Tamargo with an air rifle causing
injuries that resulted in her death. The petitioners, natural parents of Tamargo, filed a complaint for damages
against the natural parents of Adelberto with whom he was living the time of the tragic incident.
In December 1981, the spouses Rapisura filed a petition to adopt Adelberto Bundoc. Such petition was granted on
November 1982 after the tragic incident.
ISSUE: WON parental authority concerned may be given retroactive effect so as to make adopting parents the
indispensable parties in a damage case filed against the adopted child where actual custody was lodged with the
biological parents.
HELD: Parental liability is a natural or logical consequence of duties and responsibilities of parents, their parental
authority which includes instructing, controlling and disciplining the child. In the case at bar, during the shooting
incident, parental authority over Adelberto was still lodged with the natural parents. It follows that they are the
indispensable parties to the suit for damages. Parents and guardians are responsible for the damage caused by the
child under their parental authority in accordance with the civil code.
SC did not consider that retroactive effect may be given to the decree of adoption so as to impose a liability upon
the adopting parents accruing at the time when they had no actual or physical custody over the adopted child.
Retroactivity may be essential if it permits accrual of some benefit or advantage in favor of the adopted child.
Under Article 35 of the Child and Youth Welfare Code, parental authority is provisionally vested in the adopting
parents during the period of trial custody however in this case, trial custody period either had not yet begin nor had
been completed at the time of the shooting incident. Hence, actual custody was then with the natural parents of
Adelberto.
B.

Teachers and Schools

1.

Under the Civil Code

Spouses Moises and Brigida Palisoc vs Antonio Brillantes

41 SCRA 548 Civil Law Torts and Damages Liability of teachers/heads of establishments of arts
and trades

FACTS: In March 1966, while Dominador Palisoc (16 years old) was watching Virgilio Daffon and Desiderio Cruz
work on a machine in their laboratory class in the Manila Technical Institute (a school of arts and trades), Daffon
scolded Palisoc for just standing around like a foreman. This caused Palisoc to slightly slap the face of Daffon and a
fistfight ensued between the two. Daffon delivered blows that eventually killed Palisoc. The parents of Palisoc sued
Daffon, the school president (Teodosio Valenton), the instructor (Santiago Quibulue), and the owner (Antonio
Brillantes). The basis of the suit against Valenton, Quibulue, and Brillantes was Article 2180 of the Civil Code.

The lower court, as well as the CA, ruled that only Daffon is liable for damages and that Valenton, Quibulue, and
Brillantes are not liable because under Article 2180, they are only liable so long as they [the students] remain in
their custody. And that this means, as per Mercado vs Court of Appeals, that teachers or heads of establishments

are only liable for the tortious acts of their students if the students are living and boarding with the teacher or other
officials of the school which Daffon was not.
ISSUE: Whether or not the ruling in the Mercado Case still applies.
HELD: No. The SC abandoned the ruling in the Mercado Case as well as the ruling in the Exconde Case as they
adopted Justice JBL Reyes dissenting opinion in the latter case. Valenton and Quibulue as president and teacher-incharge of the school must be held jointly and severally liable for the quasi-delict of Daffon. The unfortunate death
resulting from the fight between the students could have been avoided, had said defendants but complied with
their duty of providing adequate supervision over the activities of the students in the school premises to protect
their students from harm, whether at the hands of fellow students or other parties. At any rate, the law holds them
liable unless they relieve themselves of such liability, in compliance with the last paragraph of Article 2180, Civil
Code, by (proving) that they observed all the diligence of a good father of a family to prevent damage. In the light
of the factual findings of the lower courts decision, said defendants failed to prove such exemption from liability.
The SC reiterated that there is nothing in the law which prescribes that a student must be living and boarding with
his teacher or in the school before heads and teachers of the school may be held liable for the tortious acts of their
students.
Amadora vs. CA
GR No. L47745, April 15, 1988
FACTS: Alfredo Amadora, while in the auditorium of the school, was mortally hit by a gun by Pablito Daffon
resulting to the formers death. Daffon was convicted of homicide through reckless imprudence. The victims
parents, herein petitioners, filed a civil action for damages against Colegio de San Jose-Recoletos, its rectors, high
school principal, dean of boys, the physics teacher together with Daffon and 2 other students. Complaints against
the students were dropped. Respondent Court absolved the defendants completely and reversed CFI Cebus
decision for the following reasons: 1. Since the school was an academic institution of learning and not a school of
arts and trades 2. That students were not in the custody of the school since the semester has already ended 3.
There was no clear identification of the fatal gun, and 4. In any event, defendants exercised the necessary diligence
through enforcement of the school regulations in maintaining discipline. Petitioners on othe other hand claimed
their son was under school custody because he went to school to comply with a requirement for graduation
(submission of Physics reports).
ISSUE: WON Collegio de San Jose-Recoletos should be held liable.
HELD: The time Alfredo was fatally shot, he was in the custody of the authorities of the school notwithstanding
classes had formally ended when the incident happened. It was immaterial if he was in the school auditorium to
finish his physics requirement. What was important is that he was there for a legitimate purpose. On the other
hand, the rector, high school principal and the dean of boys cannot be held liable because none of them was the
teacher-in-charge as defined in the provision. Each was exercising only a general authority over the students and
not direct control and influence exerted by the teacher placed in-charge of particular classes.
In the absence of a teacher- in charge, dean of boys should probably be held liable considering that he had earlier
confiscated an unlicensed gun from a student and later returned to him without taking disciplinary action or
reporting the matter to the higher authorities. Though it was clear negligence on his part, no proof was shown to
necessarily link this gun with the shooting incident.
Collegio San Jose-Recoletos cannot directly be held liable under the provision because only the teacher of the head
of school of arts and trade is made responsible for the damage caused by the student. Hence, under the facts
disclosed, none of the respondents were held liable for the injury inflicted with Alfredo resulting to his death.
Petition was denied.

AMADORA VA CA
Posted by kaye lee on 3:00 AM
G.R. No. L-47745 April 15 1988 [Parental Authority]
FACTS: 17 year old Alfredo Amadora was shot and killed by his classmate Pablito Daffon inside the school campus.
Daffon was convicted of homicide thru reckless imprudence. The parents filed a civil action for damages under
Article 2180 of the Civil Code against the Colegio de San Jose Recoletos, its high school principal, the dean of boys,
the physics teacher, Daffon and two other students, through their respective parents. The complaints against the

students was later dropped. Upon appeal to CA, the decision was reversed and all the defendants were completely
absolved.
ISSUE: Whether or not the school should be held liable for the acts of its students.
RULING: The responsibility of the school authorities over the student continues even if the student should be doing
nothing more than relaxing in the campus in the company of his classmates and friends. Under the Article 2180 of
the Family Code, it is the teacher-in charge is the one who is imposed on the liability of his/her students and not the
school. As long as defendant can show that he had taken the necessary precautions to prevent the injury
complained of, he can exonerate himself from the liability imposed by Art. 2180.

Salvosa v. IAC
G.R. No. 70458 [October 5, 1988]
Facts of the Case: Baguio Colleges Foundation is an academic institution. However, it is also an institution of arts
and trade because BCF has a full-fledged technical-vocational department offering Communication, Broadcast and
Teletype Technician courses as well as Electronics Serviceman and Automotive Mechanics courses.
Within the premises of the BCF is an ROTC Unit. The Baguio Colleges Foundation ROTC Unit had Jimmy B. Abon as
its duly appointed armorer. As armorer of the ROTC Unit, Jimmy B. Abon received his appointment from the AFP. Not
being an employee of the BCF, he also received his salary from the AFP, as well as ordersfrom Captain Roberto C.
Ungos. Jimmy B. Abon was also a commerce student of the BCF.
On 3 March 1977, at around 8:00 p.m., in the parking space of BCF, Jimmy B. Abon shot Napoleon Castro a student
of the University of Baguio with an unlicensed firearm which the former took from the armory of the ROTC Unit of
the BCF. As a result, Napoleon Castro died and Jimmy B. Abon was prosecuted for, and convicted of the crime
of Homicide.
Subsequently, the heirs of Napoleon Castro sued for damages, impleading Jimmy B. Abon and the BCF .
Issue: WON BCF is subsidiarily liable.
Ruling of the Case: Under the penultimate paragraph of Art. 2180 of the Civil Code, teachers or heads of
establishments of arts and trades are liable for damages caused by their pupils and students or apprentices, so
long as they remain in their custody. The rationale of such liability is that so long as the student remains in the
custody of a teacher, the latter stands, to a certain extent, in loco parentis as to the student and is called upon to
exercise reasonable supervision over the conduct of the student. Likewise, the phrase used in [Art. 2180 so
long as (the students) remain in their custody means the protective and supervisory custody that the school and its
heads and teachers exercise over the pupils and students for as long as they are at attendance in the school,
including recess time. Jimmy B. Abon cannot be considered to have been at attendance in the school, or in the
custody of BCF, when he shot Napoleon Castro. Logically, therefore, petitioners cannot under Art. 2180 of the Civil
Code be held solidarity liable with Jimmy B. Abon for damages resulting from his acts.

Salvosa vs. Intermediate Appellate Court

G.R. No. 70458, October 5, 1988
Facts: Jimmy Abon was a duly appointed armorer of the ROTC Unit of Baguio Colleges Foundation (BCF). He
received his appointment as an armorer from the AFP. Not being an employee of BCF, he received his salary from
the AFP, as well as orders from Captain Roberto Ungos, Commandant of the said ROTC unit. Abon was also a
commerce student of BCF. On March 3, 1977, around 8:00pm, Abon shot Napoleon Castro, a student of University of
Baguio, with an unlicensed firearm which the former took from the armory of the ROTC Unit of BCF. As a result,
Castro died and Abon was prosecuted and convicted of the crime of Homicide by the Military Commission.
Subsequently, the heirs of Casto sued for damages, impleading Jimmy Abon, Roberto Ungos, Benjamin Salvosa
(President and Chairman of the Board of BCF), LIbertad Quetolio (Dean of the College of Education and Executive
Trustee of BCF), and Baguio Colleges Foundation, Inc., as party defendants. After hearing, the Trial Court rendered a
decision sentencing only defendants Jimmy Abon, Benjamin Salvosa, and Baguio Colleges Foundation jointly and
severally to pay private respondents (heirs of Castro). The rest of the defendants were absolved.

On appeal by petitioners, the respondent Court affirmed with modifications the decision of the Trial court reducing
the amount of some of the awards given by the Trial Court.
Hence, this petition.
Issue: Can the petitioners be held solidarily liable with Abon for damages under Article 2180 of the Civil Code as a
consequence of the tortuous act of Abon?
Ruling: NO. the petitioners cannot be held under Article 2180 of the Civil Code be held solidarily liable with Jimmy
Abon for the damages resulting from the latters acts.
The Court held that under the penultimate paragraph of Article 2180 of the Civil Code, teachers or heads of
establishments of arts and trades are liable for "damages caused by their pupils and students or apprentices, so
long as they remain in their custody. The rationale of such liability is that so long as the student remains in the
custody of the teacher, the latter stands, to a certain extent, in loco parentis as to the student and is called upon to
exercise reasonable supervision over the conduct of the student. Likewise, the phrase used in Article 2180 so long
as the [students] remain in their custody means the protective and supervisory custody that the school and its
heads and teachers exercise over the pupils and students for as long as they are at attendance in the school ,
including recess time.
The Court held that Jimmy Abon cannot be considered to have been at attendance in school or in the custody of
BCF when he shot Napoleon Castro.
2.

Under the Family Code

St. Marys Academy vs. Carpetanos

GR No. 143363, February 6, 2002

FACTS: Herein petitioner, conducted an enrollment drive for the school year 1995-1996 They visited schools from
where prospective enrollees were studying. Sherwin Carpitanos joined the campaign. Along with the other high
school students, they rode a Mitsubishi jeep owned by Vivencio Villanueva on their way to Larayan Elementary
School. Such jeep was driven by James Daniel II, a 15 year old student of the same school. It was alleged that he
drove the jeep in a reckless manner which resulted for it to turned turtle. Sherwin died due to this accident.
ISSUE: WON petitioner should be held liable for the damages.
HELD: CA held petitioner liable for the death of Sherwin under Article 218 and 219 of the Family Code where it was
pointed that they were negligent in allowing a minor to drive and not having a teacher accompany the minor
students in the jeep. However, for them to be held liable, the act or omission to be considered negligent must be
the proximate cause of the injury caused thus, negligence needs to have a causal connection to the accident. It
must be direct and natural sequence of events, unbroken by any efficient intervening causes. The parents of the
victim failed to show such negligence on the part of the petitioner. The spouses Villanueva admitted that the
immediate cause of the accident was not the reckless driving of James but the detachment of the steering wheel
guide of the jeep. Futhermore, there was no evidence that petitioner allowed the minor to drive the jeep of
Villanueva. The mechanical defect was an event over which the school has no control hence they may not be held
liable for the death resulting from such accident.
The registered owner of any vehicle, even if not used for public service, would primarily be responsible to the public
or to 3rd persons for injuries caused while it is being driven on the road. It is not the school, but the registered
owner of the vehicle who shall be held responsible for damages for the death of Sherwin. Case was remanded to the
trial court for determination of the liability of the defendants excluding herein petitioner.

St. Josephs College, Sr., Josephini Ambatali, SFIC, and Rosalinda Tabugo vs. Jayson Miranda,
represented by his father, Rodolfo Miranda, G. R. No. 182353, June 29, 2010

SPECIAL PARENTAL AUTHORITY OF SCHOOLS

When can the school be held liable for injury of students within the school premises?
Facts of the case:

On November 17, 1994, at around 1:30 in the afternoon inside St. Joseph Colleges (SJCs) premises, the class to
which Jayson Val Miranda belonged was conducting a science experiment about fusion of sulphur powder and iron
fillings under the tutelage of Rosalinda Tabugo, she being the subject teacher and employee of SJC.
Tabugo left her class while it was doing the experiment. In the middle of the experiment, Jayson, who was the
assistant leader of one of the class groups, checked the result of the experiment by looking into the test tube with
magnifying glass. The test tube was being held by one of his group mates who moved it close and towards the eye
of Jayson. At that instance, the compound in the test tube spurted out and several particles of which hit Jaysons
eye and the different parts of the bodies of some of his group mates. As a result thereof, Jaysons eyes were
chemically burned, particularly his left eye, for which he had to undergo surgery and had to spend for his
medication.
On December 6, 1994, the parents of Jayson, through counsel, wrote SJC a letter demanding that it should shoulder
all the medical expenses of Jayson that had been incurred and will be incurred further arising from the accident
caused by the science experiment. In a letter dated December 14, 1994, the counsel for SJC, represented by Sr.
Josephini Ambatali, SFIC, explained that the school cannot accede to the demand because the accident occurred
by reason of [Jaysons] failure to comply with the written procedure for the experiment and his teachers repeated
warnings and instruction that no student must face, much less look into, the opening of the test tube until the
heated compound has cooled.
Since SJC did not accede to the demand, Rodolfo Miranda, Jaysons father, sued for damages Jaysons behalf.
After trial, the Regional Trial Court rendered judgment awarding actual damages, moral damages and attorneys
fees in favor of Jayson.
The Court of Appeals affirmed the ruling of the Regional Trial Court. Thus, SJC Sr. Josephini Ambatali, SFIC, and
Rosalinda Tabugo (petitioners) filed the instant case to the Supreme Court.

Findings and Decision of the Supreme Court:

The Supreme Court found no reason to depart from the uniform rulings of the lower courts that petitioners were
negligent since they all failed to exercise the required reasonable care, prudence, caution and foresight to prevent
or avoid injuries to the students.
Petitioners claim that the proximate cause of Jaysons injury was his own negligence in disregarding the instructions
given by Tabugo prior to the experiment and peeking into the test tube did not convince the Supreme Court.
As found by both lower courts, the proximate cause of Jaysons injury was the concurrent failure of petitioners to
prevent the foreseeable mishap that occurred during the conduct of the science experiment. All of the petitioners
are equally at fault and are liable for negligence because all of them are responsible for exercising the required
reasonable care, prudence, caution and foresight to prevent or avoid injuries to the students. The individual
petitioners are persons charged with the teaching and vigilance over their students as well as the supervision and
ensuring of their well-being. Sr. Josephini Ambatali is likewise culpable under the doctrine of command responsibility
because the other individual petitioners were under her direct control and supervision. The negligent acts of the
other individual petitioners were done within the scope of their assigned tasks.

Article 218 of the Family Code, in relation to Article 2180 of the Civil Code, bestows special parental authority on the
following persons with the corresponding obligation, thus:

Art. 218. The school, its administrators and teachers, or the individual, entity or institution engaged in child care
shall have special parental authority and responsibility over the minor child while under their supervision,
instruction or custody.
Authority and responsibility shall apply to all authorized activities whether inside or outside the premises of the
school, entity or institution.
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.
Lastly, teachers or heads of establishments of arts and trades shall be liable for damages caused by their pupils and
students or apprentices, so long as they remain in their custody.
Petitioners negligence and failure to exercise the requisite degree of care and caution is demonstrated by the
following:
1.
Petitioner school did not take affirmative steps to avert damage and injury to its students although it had full
information on the nature of dangerous science experiments conducted by the students during class;
2.

Petitioner school did not install safety measures to protect the students who conduct experiments in class;

3.
Petitioner school did not provide protective gears and devices, specifically goggles, to shield students from
expected risks and dangers; and
4.
Petitioner Tabugo was not inside the classroom the whole time her class conducted the experiment,
specifically, when the accident involving Jayson occurred. In any event, the size of the classfifty (50) students
conducting the experiment is difficult to monitor. (St. Josephs College, Sr., Josephini Ambatali, SFIC, and Rosalinda
Tabugo vs. Jayson Miranda, represented by his father, Rodolfo Miranda, G. R. No. 182353, June 29, 2010).

PHILIPPINE RABBIT BUS LINES and FELIX

ARCHIMEDES BALINGIT, and FERNANDO PINEDA
1975
/
Aquino
/

PANGALANGAN
Appeal

v.

PHIL-AMERICAN
from

CFI

FORWARDERS,
order

FACTS: Pineda recklessly drove a freight truck [owned by Phil-American Forwarders] along the national highway at
Pampanga, and the truck bumped the PRBL bus driven by Pangalangan. As a result, Pangalangan suffered
injuries and the bus was damaged and could not be used for 79 days, thus depriving PRBL of earnings amounting to
P8,665.51. Balingit was the manager of Phil-American Forwarders.
PRBL and Pangalangan filed a complaint for damages against Phil-American Forwarders, Balingit, and
Pineda. Defendants said Balingit was not Pinedas employer. Balingit moved that the complaint against him be
dismissed on the ground that PRBL and Pangalangan had no cause of action against him. CFI dismissed the
complaint against Balingit, on the ground that he is not the manager of an establishment as contemplated in NCC
2180.
ISSUE AND HOLDING: WON the terms employers and owners and managers of an establishment or enterprise
embrace the manager of a corporation owning a truck, the reckless operation of which allegedly resulted in the
vehicular accident from which the damage arose. NO.
RATIO: Those terms do not include the manager of a corporation. It may be gathered from the context of NCC 2180
that the term manager (director in the Spanish version) is used in the sense of employer. Hence, no tortious
or quasi-delictual liability can be imposed on Balingit as manager of Phil-American Forwarders, in connection with
the vehicular accident in question, because he himself may be regarded as an employee or dependiente of PhilAmerican Forwarders.
CFI AFFIRMED

Philippine Rabbit Bus Lines and Felix Pangalangan,plaintiff-appellants vs. Philippine-American

Forwarders, Inc. (PAFI), Archimedes Balingit and Fernando Pineda, defendant-appellees
GR No. L-25142, 25 March 1975, 63 SCRA 231
When a party deliberately adopts a certain theory and the case is decided upon that theory in the court below, he
will not be permitted to change his theory on appeal because, to permit him to do so, could be unfair to the adverse
party. Thus, the Supreme Court disregarded Pangalangan and Philippine Rabbits argument that the doctrine of
piercing the corporate veil be used against PAFI, Archimedes Balingit and his wife. The issue was not raised in the
trial court below. The case has to be decided based on allegations stated in the pleadings (complaint) of the
appellants, where it was assumed that Balingit and his wife has separate legal personality from Philippine-American
Forwarders.
Civil Law (Torts)
The terms employers and owners and managers of an establishment or enterprise (dueos o directores de un
establicimiento o empresa) used in Article 2180 of the New Civil Code (formerly Article 1903, the 1889 Civil Code of
Spain/Old Civil Code) does not include manager of corporation. The Supreme Court interpreted the term manager
(directores,Spanish) is used in the sense of employer, as it may be gathered from the articles context.
Thus, the Supreme Court held that Balingit, as manager and employee of Philippine-American Forwarders, is not
liable for damages awarded to Pangalangan and Philippine Rabbit.
Type of Appeal: Appeal on pure question of law by Philippine Rabbit and Pangalangan of the Court of the First
Instance Tarlac decision, which dismissed liability of Philippine-American Forwarders manager Archimedes Balingit.
Facts: Pangalangan and Philippine Rabbit alleged that on 24 November 1962, Fernando Pineda drove recklessly the
freight truck owned by his employer Philippine-American Forwarders along the national highway at Sto. Tomas,
Pampanga. It bumped the Philippine Rabbit bus driven by Felix Pangalangan. As a result of the accident,
Pangalangan was injured and the damaged bus
cannot be used for seventy-nine (79) days, causing loss of income amounting to PhP8,665.81 to Philippine Rabbit.
Philippine Rabbit and Pangalangan as plaintiffs, filed a case for damages against the defendants PhilippineAmerican Forwarders, its manager Archimedes Balingit and the driver Fernando Pineda for damages and lost
income sustained by Philippine Rabbit and the injuries sustained by Pangalangan. Balingit stated in defense that he
is not Pineda s employer and he asked for the dismissal of the plaintiffs case as they had no cause of action
against him. The CFI Tarlac held only PAFI and Pineda liable for damages and injuries sustained and dismissed
Balingit s liability. As a result, Philippine Rabbit and Pangalangan appealed the trial court s decision to the Supreme
Court.
Issues:
In their appeal, Felix Pangalangan and Philippine Rabbit raised the issues:
1.Whether the trial court was right in dismissing the liability of PAFI manager Archimedes Balingit to the damage
sustained by them?
2.Whether the issue that Phil-American Forwarders, Inc. and Balingit and his wife should be treated as one and the
same civil personality can be raised and adjudged on appeal?
Legal Provisions:
The New Civil Code states: Article 2176. Whoever by act or omission causes damage to another, there being fault or
negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual
relation between the parties, is called a quasi-delict and is governed by the provisions of this Chapter. (1902a)
Article 2180. 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. Guardians are
liable for damages caused by the minors or incapacitated persons who are under their authority and live in their
company.
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. The State is
responsible in like manner when it acts through a special agent; but not when the damage has been caused by the
official to whom the task done properly pertains, in which case what is provided in article 2176 shall be applicable.
Lastly, teachers or heads of establishments of arts and trades shall be liable for damages caused by their pupils and
students or apprentices, so long as they remain in their custody. 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. (1903a)
Held by the Supreme Court The trial court s decision on appeal is AFFIRMED and costs against plaintiff-appellants.
The Supreme Court held that based on the allegations of the complaint of appellants Philippine Rabbit and
Pangalangan, Balingit has no liability based on tort or quasi-delict as manager of Phil-American Forwarders, Inc. in

connection with the vehicular accident because he may be regarded as an employee of Phil-American Forwarders,
Inc. The Supreme Court interpreted the term manager (directores, Spanish) is used in the sense of employer, as
it may be gathered from the articles context.
The Supreme Court disregarded the appellant s argument raised on appeal that the doctrine of piercing the
corporate veil be used against PAFI, Archimedes Balingit and his wife. Since that issue was not raised in the trial
court below, it cannot be raised also on appeal. The case has to be decided based on allegations stated in the
pleadings (complaint) of the appellants, where it was assumed that Balingit and his wife has a separate legal
personality from that of Philippine-American Forwarders, Inc.

C.

Owners/ Managers of Establishments/ Employers

1.

Distinguishing the 4th and 5th Paragraph

Castilex Industrial Corporation v. Vasquez

G.R. No. 132266, 21 December 1999

Complainants are the heirs of Romeo So Vasquez who died after being hit by a company-issued vehicle driven by
Benjamin Abad, who was a manager of defendant Castilex Industrial Corporation. The incident happened around
2:00 am when Abad was on his way home from a lively restaurant after doing overtime work and leaving with the
vehicle. In their Defense, Castilex claimed that Abad was not acting within the scope of his functions when the
incident happened.

HELD: Castilex Industrial Corporation was not liable. The mere fact that ABAD was using a service vehicle at the
time of the injurious incident is not of itself sufficient to charge [the Corporation] with liability for the negligent
operation of said vehicle unless it appears that he was operating the vehicle within the course or scope of his
employment.

The following are principles in American Jurisprudence on the employers liability for the injuries inflicted by the
negligence of an employee in the use of an employers motor vehicle:

I. Operation of Employers Motor Vehicle in Going to or from Meals

It has been held that an employee who uses his employers vehicle in going from his work to a place where he
intends to eat or in returning to work from a meal is not ordinarily acting within the scope of his employment in the
absence of evidence of some special business benefit to the employer. Evidence that by using the employers
vehicle to go to and from meals, an employee is enabled to reduce his time-off and so devote more time to the
performance of his duties supports the finding that an employee is acting within the scope of his employment while
so driving the vehicle.

II. Operation of Employers Vehicle in Going to or from Work

In the same vein, traveling to and from the place of work is ordinarily a personal problem or concern of the
employee, and not a part of his services to his employer. Hence, in the absence of some special benefit to the
employer other than the mere performance of the services available at the place where he is needed, the employee
is not acting within the scope of his employment even though he uses his employers motor vehicle.

The employer may, however, be liable where he derives some special benefit from having the employee drive
home in the employers vehicle as when the employer benefits from having the employee at work earlier and,
presumably, spending more time at his actual duties. Where the employees duties require him to circulate in a
general area with no fixed place or hours of work, or to go to and from his home to various outside places of work,
and his employer furnishes him with a vehicle to use in his work, the courts have frequently applied what has been
called the special errand or roving commission rule, under which it can be found that the employee continues in
the service of his employer until he actually reaches home. However, even if the employee be deemed to be acting

within the scope of his employment in going to or from work in his employers vehicle, the employer is not liable for
his negligence where at the time of the accident, the employee has left the direct route to his work or back home
and is pursuing a personal errand of his own.

III. Use of Employers Vehicle Outside Regular Working Hours

An employer who loans his motor vehicle to an employee for the latters personal use outside of regular working
hours is generally not liable for the employees negligent operation of the vehicle during the period of permissive
use, even where the employer contemplates that a regularly assigned motor vehicle will be used by the employee
for personal as well as business purposes and there is some incidental benefit to the employer. Even where the
employees personal purpose in using the vehicle has been accomplished and he has started the return trip to his
house where the vehicle is normally kept, it has been held that he has not resumed his employment, and the
employer is not liable for the employees negligent operation of the vehicle during the return trip.

The foregoing principles and jurisprudence are applicable in our jurisdiction albeit based on the doctrine
of respondeat superior, not on the principle of bonus pater familias as in ours. Whether the fault or negligence of
the employee is conclusive on his employer as in American law or jurisprudence, or merely gives rise to the
presumption juris tantum of negligence on the part of the employer as in ours, it is indispensable that the employee
was acting in his employers business or within the scope of his assigned task.

In the case at bar, it is undisputed that ABAD did some overtime work at the petitioners office, which was located
in Cabangcalan, Mandaue City. Thereafter, he went to Goldies Restaurant in Fuente Osmea, Cebu City, which is
about seven kilometers away from petitioners place of business. A witness for the private respondents, a sidewalk
vendor, testified that Fuente Osmea is a lively place even at dawn because Goldies Restaurant and Back Street
were still open and people were drinking thereat. Moreover, prostitutes, pimps, and drug addicts littered the place.

At the Goldies Restaurant, ABAD took some snacks and had a chat with friends. It was when ABAD was leaving
the restaurant that the incident in question occurred. That same witness for the private respondents testified that
at the time of the vehicular accident, ABAD was with a woman in his car, who then shouted: Daddy, Daddy! This
woman could not have been ABADs daughter, for ABAD was only 29 years old at the time.

To the mind of this Court, ABAD was engaged in affairs of his own or was carrying out a personal purpose not in
line with his duties at the time he figured in a vehicular accident. It was then about 2:00 a.m. of 28 August 1988,
way beyond the normal working hours. ABADs working day had ended; his overtime work had already been
completed. His being at a place which, as [the Corporation puts] it, was known as a haven for prostitutes, pimps,
and drug pushers and addicts, had no connection to [the Corporations] business; neither had it any relation to his
duties as a manager. Rather, using his service vehicle even for personal purposes was a form of a fringe benefit or
one of the perks attached to his position.

Since there is paucity of evidence that ABAD was acting within the scope of the functions entrusted to him, [the
Corporation] had no duty to show that it exercised the diligence of a good father of a family in providing ABAD with
a service vehicle. Thus, justice and equity require that petitioner be relieved of vicarious liability for the
consequences of the negligence of ABAD in driving its vehicle. (Citations omitted.)

G.R. No. 132266 December 21, 1999

CASTILEX INDUSTRIAL CORPORATION, petitioner,
vs.
VICENTE VASQUEZ, JR. and LUISA SO VASQUEZ, and CEBU DOCTORS' HOSPITAL, INC., respondents.

FACTS: On 28 August 1988, at around 1:30 to 2:00 in the morning, Romeo So Vasquez, was driving a Honda
motorcycle around Fuente Osmea Rotunda. He was traveling counter-clockwise, (the normal flow of traffic in a
rotunda) but without any protective helmet or goggles. He was also only carrying a Student's Permit to Drive at the
time. Upon the other hand, Benjamin Abad [was a] manager of Appellant Castilex Industrial Corporation, registered
owner [of] a Toyota Hi-Lux Pick-up. On the same date and time, Abad drove the said company car out of a parking

lot but instead of going around the Osmea rotunda he made a short cut against [the] flow of the traffic in
proceeding to his route to General Maxilom St. or to Belvic St.
In the process, the motorcycle of Vasquez and the pick-up of Abad collided with each other causing severe injuries
to the former. Abad stopped his vehicle and brought Vasquez to the Southern Islands Hospital and later to the Cebu
Doctor's Hospital.
On September 5, 1988, Vasquez died at the Cebu Doctor's Hospital. It was there that Abad signed an
acknowledgment of Responsible Party (Exhibit K) wherein he agreed to pay whatever hospital bills, professional fees
and other incidental charges Vasquez may incur.
After the police authorities had conducted the investigation of the accident, a Criminal Case was filed against Abad
but which was subsequently dismissed for failure to prosecute.
The trial court ruled in favor of private respondents Vicente and Luisa Vasquez. CASTILEX and ABAD separately
appealed the decision.
Court of Appeals affirmed the ruling of the trial court holding ABAD and CASTILEX liable but held that the liability of
the latter is "only vicarious and not solidary" with the former.
Hence, CASTILEX filed the instant petition contending that the Court of Appeals erred in (1) applying to the case the
fifth paragraph of Article 2180 of the Civil Code, instead of the fourth paragraph thereof; (2) that as a managerial
employee, ABAD was deemed to have been always acting within the scope of his assigned task even outside office
hours because he was using a vehicle issued to him by petitioner; and (3) ruling that petitioner had the burden to
prove that the employee was not acting within the scope of his assigned task.
On the other hand, respondents Spouses Vasquez argue that their son's death was caused by the negligence of
petitioner's employee who was driving a vehicle issued by petitioner and who was on his way home from overtime
work for petitioner; and that petitioner is thus liable for the resulting injury and subsequent death of their son on
the basis of the fifth paragraph of Article 2180. Even if the fourth paragraph of Article 2180 were applied, petitioner
cannot escape liability therefor.
Respondent Cebu Doctor's Hospital maintains that petitioner CASTILEX is indeed vicariously liable for the injuries
and subsequent death of Romeo Vasquez caused by ABAD, who was on his way home from taking snacks after
doing overtime work for petitioner.
Petitioner contends that the fifth paragraph of Article 2180 of the Civil Code should only apply to instances where
the employer is not engaged in business or industry. Since it is engaged in the business of manufacturing and
selling furniture it is therefore not covered by said provision. Instead, the fourth paragraph should apply.
Petitioner's interpretation of the fifth paragraph is not accurate. The phrase "even though the former are not
engaged in any business or industry" found in the fifth paragraph should be interpreted to mean that it is not
necessary for the employer to be engaged in any business or industry to be liable for the negligence of his
employee who is acting within the scope of his assigned task. 5
A distinction must be made between the two provisions to determine what is applicable. Both provisions apply to
employers: the fourth paragraph, to owners and managers of an establishment or enterprise; and the fifth
paragraph, to employers in general, whether or not engaged in any business or industry. The fourth paragraph
covers negligent acts of employees committed either in the service of the branches or on the occasion of their
functions, while the fifth paragraph encompasses negligent acts of employees acting within the scope of their
assigned task. The latter is an expansion of the former in both employer coverage and acts included. Negligent acts
of employees, whether or not the employer is engaged in a business or industry, are covered so long as they were
acting within the scope of their assigned task, even though committed neither in the service of the branches nor on
the occasion of their functions. For, admittedly, employees oftentimes wear different hats. They perform functions
which are beyond their office, title or designation but which, nevertheless, are still within the call of duty.
This court has applied the fifth paragraph to cases where the employer was engaged in a business or industry such
as truck operators 6 and banks.
Under the fifth paragraph of Article 2180, whether or not engaged in any business or industry, an employer is liable
for the torts committed by employees within the scope of his assigned tasks. But it is necessary to establish the

employer-employee relationship; once this is done, the plaintiff must show, to hold the employer liable, that the
employee was acting within the scope of his assigned task when the tort complained of was committed.
It is undisputed that ABAD was a Production Manager of petitioner CASTILEX at the time of the tort occurrence.
Now on the issue of whether the private respondents have sufficiently established that ABAD was acting within the
scope of his assigned tasks.
ABAD, who was presented as a hostile witness, testified that at the time of the incident, he was driving a companyissued vehicle, registered under the name of petitioner. He was then leaving the restaurant where he had some
snacks and had a chat with his friends after having done overtime work for the petitioner.
Court of Appeals were one in holding that the driving by a manager of a company-issued vehicle is within the scope
of his assigned tasks regardless of the time and circumstances.
We do not agree. The mere fact that ABAD was using a service vehicle at the time of the injurious incident is not of
itself sufficient to charge petitioner with liability for the negligent operation of said vehicle unless it appears that he
was operating the vehicle within the course or scope of his employment.
In the case at bar, it is undisputed that ABAD did some overtime work at the petitioner's office, which was located in
Cabangcalan, Mandaue City. Thereafter, he went to Goldie's Restaurant in Fuente Osmea, Cebu City, which is
about seven kilometers away from petitioner's place of business. 17 A witness for the private respondents, a
sidewalk vendor, testified that Fuente Osmea is a "lively place" even at dawn because Goldie's Restaurant and
Back Street were still open and people were drinking thereat. Moreover, prostitutes, pimps, and drug addicts littered
the place. 18
At the Goldie's Restaurant, ABAD took some snacks and had a chat with friends. It was when ABAD was leaving the
restaurant that the incident in question occurred. That same witness for the private respondents testified that at the
time of the vehicular accident, ABAD was with a woman in his car, who then shouted: "Daddy, Daddy!" 19This
woman could not have been ABAD's daughter, for ABAD was only 29 years old at the time.
To the mind of this Court, ABAD was engaged in affairs of his own or was carrying out a personal purpose not in line
with his duties at the time he figured in a vehicular accident. It was then about 2:00 a.m. of 28 August 1988, way
beyond the normal working hours. ABAD's working day had ended; his overtime work had already been completed.
Since there is paucity of evidence that ABAD was acting within the scope of the functions entrusted to him,
petitioner CASTILEX had no duty to show that it exercised the diligence of a good father of a family in providing
ABAD with a service vehicle. Thus, justice and equity require that petitioner be relieved of vicarious liability for the
consequences of the negligence of ABAD in driving its vehicle. 20
The petition is GRANTED.
2.

When Applicable
a.

Employer- Employee Relationship

SPS. BUENAVENTURA JAYME AND ROSARIO JAYME vs. RODRIGO APOSTOL, ET AL.
CASE DIGEST: SPS. BUENAVENTURA JAYME AND ROSARIO JAYME VS. RODRIGO APOSTOL, ET AL.
G.R. No. 163609 [November 27, 2008]
FACTS: On February 5, 1989, Mayor Miguel of Koronadal, South Cotabato was on board the Isuzu pick-up truck
driven by Fidel Lozano, an employee of the Municipality of Koronadal. The pick-up truck was registered under the
name of Rodrigo Apostol, but it was then in the possession of Ernesto Simbulan. Lozano borrowed the pick-up truck
from Simbulan to bring Miguel to Buayan Airport at General Santos City to catch his Manila flight.
The pick-up truck accidentally hit Marvin C. Jayme, a minor, who was then crossing the National Highway in South
Cotabato. The intensity of the collision sent Marvin some 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. Marvin sustained severe head
injuries. Despite medical attention, Marvin expired six (6) days after the accident.

ISSUE:
1. WON municipal mayor be held solidarily liable for the negligent acts of the driver assigned to him
2. WON an LGU be held liable for the tortuous act of a government employee.

RULING:

1. 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. The Municipality of Koronadal remains to be
Lozanos employer notwithstanding Lozanos assignment to Mayor Miguel. Even assuming arguendo that Mayor
Miguel had authority to give instructions or directions to Lozano, he still cannot be held liable. In Benson v. Sorrell,
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.
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.
2. 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, where the
Court held 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 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.
Liability attaches to the registered owner, the negligent driver and his direct employer. 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 to its
operation.
The petition is DENIED.

G.R. No. 75112 August 17, 1992

FILAMER CHRISTIAN INSTITUTE, petitioner,
vs.
HON. INTERMEDIATE APPELLATE COURT, HON. ENRIQUE P. SUPLICO, in his capacity as Judge of the
Regional Trial Court, Branch XIV, Roxas City and POTENCIANO KAPUNAN, SR., respondents.
GUTIERREZ, JR., J.:
The private respondents, heirs of the late Potenciano Kapunan, seek reconsideration of the decision rendered by
this Court on October 16, 1990 (Filamer Christian Institute v. Court of Appeals, 190 SCRA 477) reviewing the
appellate court's conclusion that there exists an employer-employee relationship between the petitioner and its codefendant Funtecha. The Court ruled that the petitioner is not liable for the injuries caused by Funtecha on the
grounds that the latter was not an authorized driver for whose acts the petitioner shall be directly and primarily
answerable, and that Funtecha was merely a working scholar who, under Section 14, Rule X, Book III of the Rules
and Regulations Implementing the Labor Code is not considered an employee of the petitioner.
The private respondents assert that the circumstances obtaining in the present case call for the application of
Article 2180 of the Civil Code since Funtecha is no doubt an employee of the petitioner. The private respondents
maintain that under Article 2180 an injured party shall have recourse against the servant as well as the petitioner
for whom, at the time of the incident, the servant was performing an act in furtherance of the interest and for the
benefit of the petitioner. Funtecha allegedly did not steal the school jeep nor use it for a joy ride without the
knowledge of the school authorities.
It is undisputed that Funtecha was a working student, being a part-time janitor and a scholar of petitioner Filamer.
He was, in relation to the school, an employee even if he was assigned to clean the school premises for only two (2)
hours in the morning of each school day.

Having a student driver's license, Funtecha requested the driver, Allan Masa, and was allowed, to take over the
vehicle while the latter was on his way home one late afternoon. It is significant to note that the place where Allan
lives is also the house of his father, the school president, Agustin Masa. Moreover, it is also the house where
Funtecha was allowed free board while he was a student of Filamer Christian Institute.
Allan Masa turned over the vehicle to Funtecha only after driving down a road, negotiating a sharp dangerous curb,
and viewing that the road was clear. According to Allan's testimony, a fast moving truck with glaring lights nearly hit
them so that they had to swerve to the right to avoid a collision. Upon swerving, they heard a sound as if something
had bumped against the vehicle, but they did not stop to check. Actually, the Pinoy jeep swerved towards the
pedestrian, Potenciano Kapunan who was walking in his lane in the direction against vehicular traffic, and hit him.
Allan affirmed that Funtecha followed his advise to swerve to the right. At the time of the incident (6:30 P.M.) in
Roxas City, the jeep had only one functioning headlight.
Allan testified that he was the driver and at the same time a security guard of the petitioner-school. He further said
that there was no specific time for him to be off-duty and that after driving the students home at 5:00 in the
afternoon, he still had to go back to school and then drive home using the same vehicle.
Driving the vehicle to and from the house of the school president where both Allan and Funtecha reside is an act in
furtherance of the interest of the petitioner-school. Allan's job demands that he drive home the school jeep so he
can use it to fetch students in the morning of the next school day.
It is indubitable under the circumstances that the school president had knowledge that the jeep was routinely
driven home for the said purpose. Moreover, it is not improbable that the school president also had knowledge of
Funtecha's possession of a student driver's license and his desire to undergo driving lessons during the time that he
was not in his classrooms.
In learning how to drive while taking the vehicle home in the direction of Allan's house, Funtecha definitely was not
having a joy ride. Funtecha was not driving for the purpose of his enjoyment or for a "frolic of his own" but
ultimately, for the service for which the jeep was intended by the petitioner school. Therefore, the Court is
constrained to conclude that the act of Funtecha in taking over the steering wheel was one done for and in behalf of
his employer for which act the petitioner-school cannot deny any responsibility by arguing that it was done beyond
the scope of his janitorial duties. The clause "within the scope of their assigned tasks" for purposes of raising the
presumption of liability of an employer, includes any act done by an employee, in furtherance of the interests of the
employer or for the account of the employer at the time of the infliction of the injury or damage. (Manuel Casada,
190 Va 906, 59 SE 2d 47 [1950]) Even if somehow, the employee driving the vehicle derived some benefit from the
act, the existence of a presumptive liability of the employer is determined by answering the question of whether or
not the servant was at the time of the accident performing any act in furtherance of his master's business.
The present case does not deal with a labor dispute on conditions of employment between an alleged employee
and an alleged employer. It invokes a claim brought by one for damages for injury caused by the patently negligent
acts of a person, against both doer-employee and his employer. Hence, the reliance on the implementing rule on
labor to disregard the primary liability of an employer under Article 2180 of the Civil Code is misplaced. An
implementing rule on labor cannot be used by an employer as a shield to avoid liability under the substantive
provisions of the Civil Code.
There is evidence to show that there exists in the present case an extra-contractual obligation arising from the
negligence or reckless imprudence of a person "whose acts or omissions are imputable, by a legal fiction, to
other(s) who are in a position to exercise an absolute or limited control over (him)." (Bahia v. Litonjua and Leynes,
30 Phil. 624 [1915])
Funtecha is an employee of petitioner Filamer. He need not have an official appointment for a driver's position in
order that the petitioner may be held responsible for his grossly negligent act, it being sufficient that the act of
driving at the time of the incident was for the benefit of the petitioner. Hence, the fact that Funtecha was not the
school driver or was not acting within the scope of his janitorial duties does not relieve the petitioner of the burden
of rebutting the presumption juris tantum that there was negligence on its part either in the selection of a servant
or employee, or in the supervision over him. The petitioner has failed to show proof of its having exercised the
required diligence of a good father of a family over its employees Funtecha and Allan.
The Court reiterates that supervision includes the formulation of suitable rules and regulations for the guidance of
its employees and the issuance of proper instructions intended for the protection of the public and persons with
whom the employer has relations through his employees.
An employer is expected to impose upon its employees the necessary discipline called for in the performance of
any act indispensable to the business and beneficial to their employer.

In the present case, the petitioner has not shown that it has set forth such rules and guidelines as would prohibit
any one of its employees from taking control over its vehicles if one is not the official driver or prohibiting the driver
and son of the Filamer president from authorizing another employee to drive the school vehicle. Furthermore, the
petitioner has failed to prove that it had imposed sanctions or warned its employees against the use of its vehicles
by persons other than the driver.
It is an admitted fact that the actual driver of the school jeep, Allan Masa, was not made a party defendant in the
civil case for damages. This is quite understandable considering that as far as the injured pedestrian, plaintiff
Potenciano Kapunan, was concerned, it was Funtecha who was the one driving the vehicle and presumably was one
authorized by the school to drive. The plaintiff and his heirs should not now be left to suffer without simultaneous
recourse against the petitioner for the consequent injury caused by a janitor doing a driving chore for the petitioner
even for a short while. For the purpose of recovering damages under the prevailing circumstances, it is enough that
the plaintiff and the private respondent heirs were able to establish the existence of employer-employee
relationship between Funtecha and petitioner Filamer and the fact that Funtecha was engaged in an act not for an
independent purpose of his own but in furtherance of the business of his employer. A position of responsibility on
the part of the petitioner has thus been satisfactorily demonstrated.
WHEREFORE, the motion for reconsideration of the decision dated October 16, 1990 is hereby GRANTED. The
decision of the respondent appellate court affirming the trial court decision is REINSTATED.

[G.R. No. 119121. August 14, 1998]

NATIONAL POWER CORPORATION, petitioner, vs. COURT OF APPEALS, Fifteenth Division and PHESCO
INCORPORATED, respondents.
FACTS: On July 22, 1979, a convoy of four (4) dump trucks owned by the National Power Corporation (NPC) left
Marawi city bound for Iligan city. Unfortunately, enroute to its destination, one of the trucks with plate no. RFT-9-6673 driven by a certain Gavino Ilumba figured in a head-on-collision with a Toyota Tamaraw. The incident resulted in
the death of three (3) persons riding in the Toyota Tamaraw, as well as physical injuries to seventeen other
passengers.
The heirs of the victims filed a complaint for damages against National Power Corporation (NPC) and PHESCO
Incorporated (PHESCO) before the then Court of First Instance of Lanao del Norte, Marawi City. PHESCO filed its
answer to the complaint it contended that it was not the owner of the dump truck which collided with the Toyota
Tamaraw but NPC. Moreover, it asserted that it was merely a contractor of NPC with the main duty of supplying
workers and technicians for the latters projects. On the other hand, NPC denied any liability and countered that the
driver of the dump truck was the employee of PHESCO.
The trial court rendered a decision absolving NPC of any liability.
Dissatisfied, PHESCO appealed to the Court of Appeals reversed the trial courts judgment.
Consequently, we hold Phesco not liable for the tort of driver Gavino Ilumba, as there was no employment
relationship between Phesco and driver Gavino Ilumba. Under Article 2180 of the Civil Code, to hold the employer
liable for torts committed by his employees within the scope of their assigned task, there must exist an employeremployee relationship.
Chagrined by the sudden turnaround, NPC filed a motion for reconsideration of said decision which was, however,
denied on February 9, 1995.[1] Hence, this petition.
The principal query to be resolved is, as between NPC and PHESCO, who is the employer of Ilumba, driver of the
dumptruck which figured in the accident and which should, therefore, would be liable for damages to the victims.
Specifically, NPC assigns the sole error that:
THE COURT OF APPEALS DECISION FINDING THAT PETITIONER NPC AS THE EMPLOYER OF THE DRIVER GAVINO
ILUMBA, AND CONSEQUENTLY, SENTENCING IT TO PAY THE ACTUAL AND COMPENSATORY DAMAGES SUSTAINED BY
COMPLAINANTS, IS NOT IN ACCORD WITH THE LAW OR WITH THE APPLICABLE RULINGS OF THIS HONORABLE
COURT.[2]
As earlier stated, NPC denies that the driver of the dump truck was its employee. It alleges that it did not have the
power of selection and dismissal nor the power of control over Ilumba.[3] PHESCO, meanwhile, argues that it merely
acted as a recruiter of the necessary workers for and in behalf of NPC.[4]
Before we decide who is the employer of Ilumba, it is evidently necessary to ascertain the contractual relationship
between NPC and PHESCO. Was the relationship one of employer and job (independent) contractor or one of

employer and labor only contractor?

Job (independent) contracting is present if the following conditions are met: (a) the contractor carries on an
independent business and undertakes the contract work on his own account under his own responsibility according
to his own manner and method, free from the control and direction of his employer or principal in all matters
connected with the performance of the work except to the result thereof; and (b) the contractor has substantial
capital or investments in the form of tools, equipment, machineries, work premises and other materials which are
necessary in the conduct of his business.[5] Absent these requisites, what exists is a labor only contract under
which the person acting as contractor is considered merely as an agent or intermediary of the principal who is
responsible to the workers in the same manner and to the same extent as if they had been directly employed by
him.[6] Taking into consideration the above distinction and the provisions of the Memorandum of Understanding
entered into by PHESCO and NPC, we are convinced that PHESCO was engaged in labor only contracting.
It must be noted that under the Memorandum, NPC had mandate to approve the critical path network and rate of
expenditure to be undertaken by PHESCO.[7] Likewise, the manning schedule and pay scale of the workers hired by
PHESCO were subject to confirmation by NPC.[8] Then too, it cannot be ignored that if PHESCO enters into any subcontract or lease, again NPCs concurrence is needed.[9] Another consideration is that even in the procurement of
tools and equipment that will be used by PHESCO, NPCs favorable recommendation is still necessary before these
tools and equipment can be purchased.[10] Notably, it is NPC that will provide the money or funding that will be
used by PHESCO to undertake the project.[11] Furthermore, it must be emphasized that the project being
undertaken by PHESCO, i.e., construction of power energy facilities, is related to NPCs principal business of power
generation. In sum, NPCs control over PHESCO in matters concerning the performance of the latters work is evident.
It is enough that NPC has the right to wield such power to be considered as the employer.[12]
Under this factual milieu, there is no doubt that PHESCO was engaged in labor-only contracting vis--vis NPC and as
such, it is considered merely an agent of the latter. In labor-only contracting, an employer-employee relationship
between the principal employer and the employees of the labor-only contractor is created. Accordingly, the
principal employer is responsible to the employees of the labor-only contractor as if such employees had been
directly employed by the principal employer.[13] Since PHESCO is only a labor-only contractor, the workers it
supplied to NPC, including the driver of the ill-fated truck, should be considered as employees of NPC.[14] After all,
it is axiomatic that any person (the principal employer) who enters into an agreement with a job contractor, either
for the performance of a specified work or for the supply of manpower, assumes responsibility over the employees
of the latter.[15]
However, NPC maintains that even assuming that a labor only contract exists between it and PHESCO, its liability
will not extend to third persons who are injured due to the tortious acts of the employee of the labor-only
contractor.[16] Stated otherwise, its liability shall only be limited to violations of the Labor Code and not quasidelicts.
To bolster its position, NPC cites Section 9(b), Rule VII, Book III of the Omnibus Rules Implementing the Labor Code
which reads:
(b) Labor only contracting as defined herein is hereby prohibited and the person acting as contractor shall be
considered merely as an agent or intermediary of the employer who shall be responsible to the workers in the same
manner and extent as if the latter were directly employed by him.
In other words, NPC posits the theory that its liability is limited only to compliance with the substantive labor
provisions on working conditions, rest periods, and wages and shall not extend to liabilities suffered by third parties,
viz.:
Consequently, the responsibilities of the employer contemplated in a labor only contract, should, consistent with
the terms expressed in the rule, be restricted to the workers. The same can not be expanded to cover liabilities for
damages to third persons resulting from the employees tortious acts under Article 2180 of the Civil Code.[17]
The reliance is misplaced. It bears stressing that the action was premised on the recovery of damages as a result of
quasi-delict against both NPC and PHESCO, hence, it is the Civil Code and not the Labor Code which is the
applicable law in resolving this case.
Given the above considerations, it is apparent that Article 2180 of the Civil Code and not the Labor Code will
determine the liability of NPC in a civil suit for damages instituted by an injured person for any negligent act of the
employees of the labor only contractor. This is consistent with the ruling that a finding that a contractor was a laboronly contractor is equivalent to a finding that an employer-employee relationship existed between the owner
(principal contractor) and the labor-only contractor, including the latters workers.[20]
With respect to the liability of NPC as the direct employer, Article 2180 of the Civil Code explicitly provides:

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.
In this regard, NPCs liability is direct, primary and solidary with PHESCO and the driver.[21] Of course, NPC, if the
judgment for damages is satisfied by it, shall have recourse against PHESCO and the driver who committed the
negligence which gave rise to the action.[22]
Finally, NPC, even if it truly believed that it was not the employer of the driver, could still have disclaimed any
liability had it raised the defense of due diligence in the selection or supervision of PHESCO and Ilumba.[23]
However, for some reason or another, NPC did not invoke said defense. Hence, by opting not to present any
evidence that it exercised due diligence in the supervision of the activities of PHESCO and Ilumba, NPC has
foreclosed its right to interpose the same on appeal in conformity with the rule that points of law, theories, issues of
facts and arguments not raised in the proceedings below cannot be ventilated for the first time on appeal.[24]
Consequently, its liability stands.
The decision of the Court of Appeals are AFFIRMED.
Valenzuela V. CA (1996)
G.R.No. 115024 February 7, 1996
FACTS:

June 24, 1990 2 am: While driving from her restaurant at Araneta avenue towards the direction of Manila,
Ma. Lourdes Valenzuela noticed that she had a flat tire so she parked along the sidewalk about 1 1/2 feet
away, place her emergency lights and seeked help

She was with her companion Cecilia Ramon

While she was pointing her tools to the man who will help her fixed the tires, she was suddenly hit by
another Mitsubishi Lancer driven by Richard Li who was intoxicated and she slammed accross his
windshield and fell to the ground

She was sent to UERM where she stayed for 20 days and her leg was amputated and was replaced with an
artificial one.

Her expenses totalled 147, 000 [120,000 php (confinement) + 27, 000 (aritificial leg)]
RTC: Richard Li guilty of gross negligence and liable for damages under Article 2176 of the Civil Code.

Alexander Commercial, Inc., Lis employer, jointly and severally liable for damages pursuant to Article
2180 P41,840 actual damages, P37,500 unrealized profits because of the stoppage of plaintiffs Bistro La
Conga restaurant 3 weeks after the accident on June 24, 1990, P20,000 a month as unrealized profits of
Bistro La Conga restaurant, from August, 1990 until the date of this judgment, P30,000.00, a month, for
unrealized profits in 2 Beauty salons, P1,000,000 in moral damages, P50,000, as exemplary damages,
P60,000, as reasonable attorneys fees and costs.
CA: there was ample evidence that the car was parked at the side but absolved Li's employer
Li: 55 kph - self serving and uncorroborated

ISSUE:
1. W/N
2. W/N
3. W/N
4. W/N

Rogelio Rodriguez, the owner-operator of an establishment located just across the scene of the accident:
Valenzuelas car parked parallel and very near the sidewalk and Li was driving on a very fast speed and
there was only a drizzle (NOT heavy rain)
Li was driving at 55 kph - NO
Valenzuela was guilty of contributory negligence - NO
Alexander Commercial, Inc. as Li's employer should be held liable - YES
the awarding of damages is proper. - YES.

HELD: CA modified with reinstating the RTC decision

1. NO

If Li was running at only about 55 kph then despite the wet and slippery road, he could have avoided
hitting the Valenzuela by the mere expedient or applying his brakes at the proper time and distance
it was not even necessary for him to swerve a little to the right in order to safely avoid a collision with the
on-coming car since there is plenty of space for both cars, since Valenzuela car was running at the right
lane going towards Manila and the on-coming car was also on its right lane going to Cubao

2. NO.

3. YES.

4. YES.

Contributory negligence is conduct on the part of the injured party, contributing as a legal cause to the
harm he has suffered, which falls below the standard to which he is required to conform for his own
protection
emergency rule
an individual who suddenly finds himself in a situation of danger and is required to act without much time
to consider the best means that may be adopted to avoid the impending danger, is not guilty of negligence
if he fails to undertake what subsequently and upon reflection may appear to be a better solution, unless
the emergency was brought by his own negligence
She is not expected to run the entire boulevard in search for a parking zone or turn on a dark Street or
alley where she would likely find no one to help her
She stopped at a lighted place where there were people, to verify whether she had a flat tire and to solicit
help if needed
she parked along the sidewalk, about 1 feet away, behind a Toyota Corona Car
Not the principle of respondeat superior, which holds the master liable for acts of the servant (must be in
the course of business), but that of pater familias, in which the liability ultimately falls upon the employer,
for his failure to exercise the diligence of a good father of the family in the selection and supervision of his
employees
Ordinarily, evidence demonstrating that the employer has exercised diligent supervision of its employee
during the performance of the latters assigned tasks would be enough to relieve him of the liability
imposed by Article 2180 in relation to Article 2176 of the Civil Code.
situation is of a different character, involving a practice utilized by large companies with either their
employees of managerial rank or their representatives.
Moreover, Lis claim that he happened to be on the road on the night of the accident because he was
coming from a social visit with an officemate in Paraaque was a bare allegation which was never
corroborated in the court below. It was obviously self-serving. Assuming he really came from his
officemates place, the same could give rise to speculation that he and his officemate had just been from a
work-related function, or they were together to discuss sales and other work related strategies.
Alexander Commercial, Inc. has not demonstrated, to our satisfaction, that it exercised the care and
diligence of a good father of the family in entrusting its company car to Li
As the amount of moral damages are subject to this Courts discretion, we are of the opinion that the
amount of P1,000,000.00 granted by the trial court is in greater accord with the extent and nature of the
injury -. physical and psychological - suffered by Valenzuela as a result of Lis grossly negligent driving of
his Mitsubishi Lancer in the early morning hours of the accident.
the damage done to her would not only be permanent and lasting, it would also be permanently changing
and adjusting to the physiologic changes which her body would normally undergo through the years. The
replacements, changes, and adjustments will require corresponding adjustive physical and occupational
therapy. All of these adjustments, it has been documented, are painful.

3.

Presumptions of Negligence

4.

Rebuttal of presumption

LAMPESA VS. DE VERA

FACTS: On December 28, 1988, De Vera, Jr. boarded a passenger jeepney bound for Baguio City
driven by respondent Modesto Tollas. Upon reaching the Km. 4 marker of the national highway, the jeepney came
to a complete stop to allow a truck, then being driven by Dario Copsiyat, to cross the path of the jeepney in order to
park at a private parking lot on the right side of the road. As Tollas began to maneuver the jeepney slowly along its
path, the truck, which had just left the pavement, suddenly started to slide back towards the jeepney until its rear
left portion hit the right side of the jeepney. De Vera, Jr., who was seated in the front passenger seat, noticed his left
middle finger was cut off as he was holding on to the handle of the right side of the jeepney. He asked Tollas to
bringhim immediately to the hospital.After delivering a load of vegetables, truck owner Lampesa instructed his
driver, Copsiyat, to park the truck in the parking lot across the highway. While the rear of the truck was still on the
pavement of the highway, an approaching passenger jeepney sideswiped the rear portion of the truck. This resulted
in the dismemberment of De Vera, Jr.s left middle finger, according to the defense.
Lampesa offered P5,000 to De Vera, Jr. as a gesture of humanitarian support, but the latter demanded P1 million
although this amount was later lowered to P75,000. The parties failed to settle amicably; thus, De Vera, Jr. filed an
action for damages against Lampesa, Copsiyat, Ramos and Tollas, as the truck owner, truck driver, jeepney
owner/operator and jeepney driver, respectively.

The trial court found driver Copsiyat negligent in the operation of his truck and ruled that his negligence was the
proximate cause of the injuries suffered by De Vera, Jr. Upon review, the Court of Appeals upheld the trial courts
findings of negligence on the part of Copsiyat and Lampesa.
Hence, the instant petition.
ISSUE: w o n that petitioners are liable for the injury sustained by De Vera, Jr.
HELD: In this case, both the trial and the appellate courts found Copsiyat negligent in maneuvering the truck and
ruled that his negligence was the proximate cause of the injury sustained by De Vera, Jr. Lampesa was also held
accountable by both courts because he failed to exercise due diligence in the supervision of his driver.
This Court is not bound to weigh all over again the evidence adduced by the parties, particularly where the findings
of both the trial court and the appellate court on the matter of petitioners negligence coincide. The resolution of
factual issues is a function of the trial court, whose findings on these matters are, as a general rule, binding on this
Court more so where these have been affirmed by the Court of Appeals.
On a final note, petitioners liability for moral damages and attorneys fees cannot now be questioned for failure of
petitioners to raise it before the Court of Appeals.
It is a well-entrenched rule that issues not raised below cannot be raised for the first time on appeal as to do so
would be offensive to the basic rules of fair play and justice. Moreover, the award of moral damages in this case is
justifiable under Article 2219 (2) of the Civil Code, which provides for said damages in cases of quasi-delicts causing
physical injuries. The award for attorneys fees is also proper under Article 2208 (2) of the Civil Code, considering
that De Vera, Jr. was compelled to litigate when petitioners ignored his demand for an amicable settlement of his
claim.
WHEREFORE, the petition is DENIED.
Article 2176 of the Civil Code provides that whoever by act or omission causes damage to another, there being fault
or negligence, is obliged to pay for thedamage done. Such fault or negligence, if there is no pre-existing contractual
relation between the parties, is called quasi-delict. Whether a person is negligent or not is a question of fact, which
we cannot pass upon in a petition for review on certiorari, as our jurisdiction is limited to reviewing errors of law.
Once negligence on the part of the employee is established, a presumption instantly arises that the employer was
negligent in the selection and/or supervision of said employee. To rebut this presumption, the employer must
present adequate and convincing proof that he exercised care and diligence in the selection and supervision of his
employees.
Mercury Drug v. Huang G.R. No. 172122 June 22, 2007
FACTS: At around 10:30 pm of December 20, 1996, Huang on board his red 1991 Toyota Corolla GLI Sedan was
traversing the left innermost lane of C-5 Highway towards Pasig City, when the truck suddenly swerved to its left
and slammed into the front right side of the car.
The collision hurled the car over the island where it hit a lamppost, spun around and landed on the opposite lane.
The truck also hit a lamppost, ran over the car and zigzagged towards, and finally stopped in front of Beullah Land
Church.
The car was a total wreck, while Huang sustained massive injuries to his spinal cord, head, face, and lung. Despite a
series of operations, respondent Stephen Huang is paralyzed for life from his chest down and requires continuous
medical and rehabilitation treatment.

HELD: The Supreme Court has ordered Mercury Drug Corporation to pay over P40 million in compensation and
damages to the family of a promising student who got paralyzed for life after his car collided with a six-wheeler
truck owned by the drug firm in 1996 along the C-5 Highway in Taguig City.
SC affirmed the rulings of the Court of Appeals and the Makati regional trial court branch 64 finding Mercury Drug
and its driver Roland del Rosario jointly and severally liable for the accident met by Stephen Huang, then 17 years
old.
Aside from actual damages of P2,973,000, the Supreme Court ordered Mercury Drug and del Rosario to pay the
victim and his parent compensatory damages of P23,461,062 for life care cost of Stephen; P10,000,000 for lost or
impaired earning capacity of the victim; P1,000,000 as moral damages; P2,000,000 as exemplary damages; and
P1,000,000 as attorneys fees and litigation expense.
The Supreme Court said the P10 million for the loss or impairment of his earning capacity was a necessary

compensation, considering his age, probable life expectancy, the state of his health, and his mental and physical
condition before the accident.
The high court pointed out that had it not been for the fatal accident, Huang would have faced a rosy future, being
an exceptional student (who) excelled both in his academics and extracurricular undertakings."
He is intelligent and motivated, a go-getter, as testified by Francisco Lopez, respondent Stephen Huangs
godfather and a bank executive. Had the accident not happened, he had a rosy future ahead of him. He wanted to
embark on a banking career, get married and raise children. Taking into account his outstanding abilities, he would
have enjoyed a successful professional career in banking," the Court said.
The Supreme Court said that based on the records that at the time of the accident, del Rosario was driving without
a license because he was previously ticketed for reckless driving.
Evidence also shows that del Rosario failed to step on his brakes immediately after hitting Huangs car, which could
have reduced the injuries sustained by the latter.
The Supreme Court added that Mercury Drug failed to exercise due diligence in the selection and supervision of
their employees. The Court noted that the drug firm allowed Del Rosario to continue driving without a license.
The Court also noted that at the time of the accident, del Rosario has been out on the road for more than thirteen
hours, without any alternate or a back-up driver.
Citing Articles 2176 and 2180 of the Civil Code, the Supreme Court extended liability to Mercury Drug, saying 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."
Court records showed that Mercury Drug is the registered owner of a six-wheeler 1990 Mitsubishi Truck with plate
number PRE 641, with del Rosario as its employed driver.

CHILD LEARNING CENTER, INC. and SPOUSES EDGARDO L. LIMON and SYLVIA S. LIMON, vs.TIMOTHY
TAGARIO, assisted by his parents BASILIO TAGORIO and HERMINIA TAGORIO
G.R. No. 150920 November 25, 2005
FACTS: Timothy Tagoria was a grade IV student at Marymount School, an academic institution operated and
maintained by Child Learning Center, Inc. (CLC). One afternoon, he found himself
locked inside the boys comfort room in Marymount. He started to panic so he banged and
kicked the door and yelled for help. No help arrived. He then decided to open the window to call for help. As he
opened the window, Timothy went right through and fell down three stories. Timothy was hospitalized and given
medical treatment for serious multiple physical injuries. He, assisted by his parents, filed a civil action against the
CLC, the members of its Board of Directors which includes the Spouses Limon. They claim that the school was
negligent for not installing iron grills at the window of the boys comfort room. CLC, in its defense, maintained that
there was nothing defective about the locking mechanism of the door and that the fall of Timothy was not due to its
fault or negligence. CLC further maintained that it had exercised the due care and diligence of a good father of a
family to ensure the safety, well-being and convenience of its students.
The trial court ruled in favor of the respondents. The respondents proceeded their appeal to
the Court of Appeals who affirmed the trial courts ruling in toto.
ISSUE: Whether or not the school was negligent for the boys accidental fall.
RULING: YES. In every tort case filed under Article 2176 of the Civil Code, plaintiff has to prove by a preponderance
of evidence: (1) the damages suffered by the plaintiff; (2) the fault or negligence of the defendant or some other
person for whose act he must respond; and (3) the connection of cause and effect between the fault or negligence
and the damages incurred. In this tort case, respondents contend that CLC failed to provide precautionary measures
to avoid harm and injury to its students in two instances: (1) failure to fix a defective door knob despite having been
notified of the problem; and (2) failure to install safety grills on the window where Timothy fell from. During trial, it
was found that the lock was defective. The architect witness testified that he did not verify if the doorknob at the
comfort room was actually put in place. Further, the fact that Timothy fell out through the window shows that the
door could not be opened from the inside.

That sufficiently points to the fact that something was wrong with the door, if not the doorknob, under the principle
of res ipsa loquitor . The doctrine of res ipsa loquitor applies where (1)the accident was of such character as to
warrant an inference that it would not have happened except for the defendants negligence; (2) the accident must
have been caused by an agency or instrumentality within the exclusive management or control of the person
charged with the negligence complained of; and (3) the accident must not have been due to any voluntary action or
contribution on the part of the person injured. Petitioners are clearly answerable for failure to see to it that the
doors of their school toilets are at all times in working condition. The fact that a student had to go through the
window, instead of the door, shows that something was wrong with the door. As to the absence of grills on the
window, petitioners contend that there was no such requirement under the Building Code. Nevertheless, the fact is
that such window, as petitioners themselves point out, was approximately 1.5 meters from the floor, so that it was
within reach of a student who finds the regular exit, the door, not functioning.
Petitioners, with the due diligence of a good father of the family, should have anticipated that a student, locked in
the toilet by a non-working door, would attempt to use the window to call for help or even to get out. Considering all
the circumstances, therefore, there is sufficient basis to sustain a
finding of liability on petitioners part.
Petitioners argument that CLC exercised the due diligence of a good father of a family in the
selection and supervision of its employees is not decisive. Due diligence in the selection and supervision of
employees is applicable where the employer is being held responsible for theacts or omissions of others under
Article 2180 of the Civil Code.
In this case, CLCs liability is under Article 2176 of the Civil Code, premised on the fact of its own negligence in not
ensuring that all its doors are properly maintained. The Courts pronouncement
that Timothy climbed out of the window because he could not get out using the door, negates petitioners other
contention that the proximate cause of the accident was Timothys own negligence. The injuries he sustained from
the fall were the product of a natural and continuous sequence, unbroken by any intervening cause, that originated
from CLCs own negligence.
PETITION DENIED.
Merritt vs Government of the Philippine Islands

FACTS: Merrit was riding a motorcycle along Padre Faura Street when he was bumped by the ambulance of the
General Hospital. Merrit sustained severe injuries rendering him unable to return to work. The legislature later
enacted Act 2457 authorizing Merritt to file a suit against the Government in order to fix the responsibility for the
collision between his motorcycle and the ambulance of the General Hospital, and to determine the amount of the
damages, if any, to which he is entitled. After trial, the lower court held that the collision was due to the negligence
of the driver of the ambulance. It then determined the amount of damages and ordered the government to pay the
same.
ISSUES:
1. Did the Government, in enacting the Act 2457, simply waive its immunity from suit or did it also concede its
liability to the plaintiff?
2. Is the Government liable for the negligent act of the driver of the ambulance?

HELD:
1. By consenting to be sued a state simply waives its immunity from suit. It does not thereby concede its liability to
plaintiff, or create any cause of action in his favor, or extend its liability to any cause not previously recognized. It
merely gives a remedy to enforce a preexisting liability and submits itself to the jurisdiction of the court, subject to
its right to interpose any lawful defense.
2. Under the Civil Code, the state is liable when it acts through a special agent, but not when the damage should
have been caused by the official to whom properly it pertained to do the act performed. A special agent is one who
receives a definite and fixed order or commission, foreign to the exercise of the duties of his office if he is a special
official. This concept does not apply to any executive agent who is an employee of the acting administration and
who on his own responsibility performs the functions which are inherent in and naturally pertain to his office and
which are regulated by law and the regulations. The driver of the ambulance of the General Hospital was not a
special agent; thus the Government is not liable. (Merritt vs Government of the Philippine Islands, G.R. No. L-11154,
March 21 1916, 34 Phil. 311)

NOTE:
The State is responsible in like manner when it acts through a special agent; but not when the damage has been
caused by the official to whom the task done properly pertains. (Art. 2180 par. 6, Civil Code)
The state is not responsible for the damages suffered by private individuals in consequence of acts performed by
its employees in the discharge of the functions pertaining to their office, because neither fault nor even negligence
can be presumed on the part of the state in the organization of branches of public service and in the appointment
of its agents. (Merritt vs. Government of the Philippine Islands)
The State is not liable for the torts committed by its officers or agents whom it employs, except when expressly
made so by legislative enactment. The government does not undertake to guarantee to any person the fidelity of
the officers or agents whom it employs since that would involve it in all its operations in endless embarrassments,
difficulties and losses, which would be subversive of the public interest. (Merritt vs. Government of the Philippine
Islands)

G.R. No. L-1120

August 31, 1948

INOCENCIO ROSETE, petitioner,

vs.
THE AUDITOR GENERAL, respondent.
This is an appeal from the decision of the Insular Auditor denying the claim of Inocencio Rosete and others against
the Government in the amount of P35,376, for damages caused to buildings belonging to the claimant, which
according to the appellant's claim were destroyed by fire that came from the contiguous warehouse of the
Emergency Control Administration, ECA, located at No. 2262 Azcarraga, due to the negligence of a certain Jose
Frayno y Panlilio in igniting recklessly his cigarette-lighter near a five gallon drum into which gasoline was being
drained, and of the officers of the said ECA, which is an office or agency of the Government, in storing gasoline in
said warehouse contrary to the provisions of Ordinances of the City of Manila.
It is not necessary for us to pass upon the facts alleged by the appellant, but only on the question whether,
assuming them to be true, the Insular Auditor erred in denying or dismissing the appellant's claim.
The claimant contends that the Auditor General erred in not finding that the government agency or instrumentality
known as the Emergency Control Administration of the officers thereof, were guilty of negligence in storing a highly
combustible and inflammable substance in its warehouse on bodega in Manila in violation of City Ordinances, and
therefore the government is liable for the damages sustained by the claimant under article 1903 of the Civil Code,
which in its pertinent part reads as follows: ART. 1903. The obligation imposed by the preceding article is
enforceable not only for personal acts and omissions but also for those persons for whom another is responsible.
The state is liable in the scene when it acts through a special agent, but not when the damage should have been
caused by the official to whom it properly pertained to do the act performed, in which case the provisions of the
preceding article shall be applicable.
In the case of Merritt vs. Government of the Philippine Islands (34 Phil., 311), this Court held the following:
. . . Paragraph 5 of article 1903 of the Civil Code reads:
The state is liable in this sense when it acts through a special agent, but not when the damage should have been
caused by the official to whom properly it pertained to do the act performed, in which cast the provisions of the
preceding article shall be applicable."
The supreme court of Spain in defining the scope of this paragraph said:
"That the obligation to indemnify for damages which a third person causes to another by his fault or negligence is
based, as is evidenced by the same Law 3, Title 15, Partida 7, on that the person obligated, by his own fault or
negligence, takes part in the act or omission of the third party who caused the damage. It follows therefrom that the
state, by virtue of such provisions of law, is not responsible for the damage suffered by private individuals in
consequence of acts performed by its employees in the discharge of the functions pertaining to their office,
because neither fault nor even negligence can be presumed on the part of the state in the organization of branches
of the public service and the appointment of its agents; on the contrary, we must presuppose all foresight humanly
possible on its part in order that each branch of service serves the general weal and that of private persons

interested in its operation. Between these latter and the state, therefore, no relations of a private nature governed
by the civil law can arise except in a case where the state acts as a judicial person capable of acquiring rights and
contracting obligations." (Supreme Court of Spain, January 7, 1898; 83 Jur. Civ., 24.).
xxx

xxx

xxx

"That the responsibility of the state is limited by article 1903 to the case wherein it acts through a special
agent (and a special agent, in the sense in which these words are employed, is one who receives a definite and
fixed order or commission, foreign to the exercise of the duties of his office if he is a special official) so that in
representation of the state and being bound to act as an agent thereof, he executes the trust confided to him. This
concept does not apply to any executive agent who is an employee of the active administration and who on his own
responsibility performs the functions which are inherent in and naturally pertain to his office and which are
regulated by law and the regulations." (Supreme Court of Spain, May 18, 1904; 98 Jur. Civ., 389, 390.).
"That according to paragraph 5 of article 1903 of the Civil Code and the principle laid down in a decision, among
others, of the 18th of May, 1904, in a damage case, the responsibility of the state is limited to that which it
contracts through a special agent, duly empowered by a definite order or commission to perform some act or
charged with some definite purpose which gives rise to the claim, and not where the claim is based on acts or
omissions imputable to a public official charged with some administrative or technical office who can be held to the
proper responsibility. Consequently, the trial court in not so deciding and in sentencing the said entity to the
payment of damages, caused by an official of the second class referred to, has by erroneous interpretation infringed
the provisions of article 1902 and 1903 of the Civil Code.' (Supreme Court of Spain, July 30, 1911; 122 Jur. Civ.,
146.)"
There being no showing that whatever negligence may be imputed to the Emergency Control Administration or its
officers, was done by an special agent, because the officers of the Emergency Control Administration did not act as
special agents of the government within the above defined meaning of that word in article 1903 of the Civil Code in
storing gasoline in warehouse of the ECA, the government is not responsible for the damages caused through such
negligence.
The case of Marine Trading vs. Government, 39 Phil., 29, cited by the appellant, is inapplicable, because the plaintiff
in that case recovered under the special provisions of articles 862, 827, 828 and 830 of the Code of Commerce and
the Philippine Marine Regulations of the Collector of Customs, regarding collision of vessels, and not on the ground
of tort in general provided for in article 1903 of the Civil Code.
Act No. 327, in authorizing the filing of claims against the Government with the Insular Auditor, and appeal by the
private persons or entities from the latter's decision to the Supreme Court, does not make any and all claims
against the Government allowable, and the latter responsible for all claims which may be filed with the Insular
Auditor under the provisions of said Act.
In view of the foregoing, the decision appealed from is affirmed.
G.R. No. L-55963 December 1, 1989
SPOUSES JOSE FONTANILLA AND VIRGINIA FONTANILLA, petitioners,
vs.
HONORABLE INOCENCIO D. MALIAMAN and NATIONAL IRRIGATION ADMINISTRATION, respondents.
G.R. No. L-61045 December 1, 1989
NATIONAL IRRIGATION ADMINISTRATION, appellant,
vs.
SPOUSES JOSE FONTANILLA and VIRGINIA FONTANILLA, appellees.
FACTS: It appears that on August 21, 1976 at about 6:30 P.M., a pickup owned and operated by respondent
National Irrigation Administration, a government agency bearing Plate No. IN-651, then driven officially by Hugo
Garcia, an employee of said agency as its regular driver, bumped a bicycle ridden by Francisco Fontanilla, son of
herein petitioners, and Restituto Deligo, at Maasin, San Jose City along the Maharlika Highway. As a result of the
impact, Francisco Fontanilla and Restituto Deligo were injured and brought to the San Jose City Emergency Hospital
for treatment. Fontanilla was later transferred to the Cabanatuan Provincial Hospital where he died.

Garcia was then a regular driver of respondent National Irrigation Administration who, at the time of the accident,
was a licensed professional driver and who qualified for employment as such regular driver of respondent after
having passed the written and oral examinations on traffic rules and maintenance of vehicles given by National
Irrigation Administration authorities.
The within petition is thus an off-shot of the action (Civil Case No. SJC-56) instituted by petitioners-spouses on April
17, 1978 against respondent NIA before the then Court of First Instance of Nueva Ecija, Branch VIII at San Jose City,
for damages in connection with the death of their son resulting from the aforestated accident.
After trial, the trial court rendered judgment on March 20, 1980 which directed respondent National Irrigation
Administration to pay damages (death benefits) and actual expenses to petitioners. The dispositive portion of the
decision reads thus:
. . . . . Judgment is here rendered ordering the defendant National Irrigation Administration to pay to the heirs of the
deceased P12,000.00 for the death of Francisco Fontanilla; P3,389.00 which the parents of the deceased had spent
for the hospitalization and burial of the deceased Francisco Fontanilla; and to pay the costs. (Brief for the petitioners
spouses Fontanilla, p. 4; Rollo, p. 132)
Respondent National Irrigation Administration filed on April 21, 1980, its motion for reconsideration of the aforesaid
decision which respondent trial court denied in its Order of June 13, 1980. Respondent National Irrigation
Administration thus appealed said decision to the Court of Appeals (C.A.-G.R. No. 67237- R) where it filed its brief
for appellant in support of its position.
Instead of filing the required brief in the aforecited Court of Appeals case, petitioners filed the instant petition with
this Court.
The sole issue for the resolution of the Court is: Whether or not the award of moral damages, exemplary damages
and attorney's fees is legally proper in a complaint for damages based on quasi-delict which resulted in the death of
the son of herein petitioners.
Petitioners allege:
1. The award of moral damages is specifically allowable. under paragraph 3 of Article 2206 of the New Civil Code
which provides that the spouse, legitimate and illegitimate descendants and ascendants of the deceased may
demand moral damages for mental anguish by reason of the death of the deceased. Should moral damages be
granted, the award should be made to each of petitioners-spouses individually and in varying amounts depending
upon proof of mental and depth of intensity of the same, which should not be less than P50,000.00 for each of
them.
2. The decision of the trial court had made an impression that respondent National Irrigation Administration acted
with gross negligence because of the accident and the subsequent failure of the National Irrigation Administration
personnel including the driver to stop in order to give assistance to the, victims. Thus, by reason of the gross
negligence of respondent, petitioners become entitled to exemplary damages under Arts. 2231 and 2229 of the
New Civil Code.
3. Petitioners are entitled to an award of attorney's fees, the amount of which (20%) had been sufficiently
established in the hearing of May 23, 1979.
4. This petition has been filed only for the purpose of reviewing the findings of the lower court upon which the
disallowance of moral damages, exemplary damages and attorney's fees was based and not for the purpose of
disturbing the other findings of fact and conclusions of law.
The Solicitor General, taking up the cudgels for public respondent National Irrigation Administration, contends thus:
1. The filing of the instant petition is rot proper in view of the appeal taken by respondent National Irrigation
Administration to the Court of Appeals against the judgment sought to be reviewed. The focal issue raised in
respondent's appeal to the Court of Appeals involves the question as to whether or not the driver of the vehicle that
bumped the victims was negligent in his operation of said vehicle. It thus becomes necessary that before
petitioners' claim for moral and exemplary damages could be resolved, there should first be a finding of negligence
on the part of respondent's employee-driver. In this regard, the Solicitor General alleges that the trial court decision
does not categorically contain such finding.

2. The filing of the "Appearance and Urgent Motion For Leave to File Plaintiff-Appellee's Brief" dated December 28,
1981 by petitioners in the appeal (CA-G.R. No. 67237-R; and G. R. No.61045) of the respondent National Irrigation
Administration before the Court of Appeals, is an explicit admission of said petitioners that the herein petition, is not
proper. Inconsistent procedures are manifest because while petitioners question the findings of fact in the Court of
Appeals, they present only the questions of law before this Court which posture confirms their admission of the
facts.
3. The fact that the parties failed to agree on whether or not negligence caused the vehicular accident involves a
question of fact which petitioners should have brought to the Court of Appeals within the reglementary period.
Hence, the decision of the trial court has become final as to the petitioners and for this reason alone, the petition
should be dismissed.
4. Respondent Judge acted within his jurisdiction, sound discretion and in conformity with the law.
5. Respondents do not assail petitioners' claim to moral and exemplary damages by reason of the shock and
subsequent illness they suffered because of the death of their son. Respondent National Irrigation Administration,
however, avers that it cannot be held liable for the damages because it is an agency of the State performing
governmental functions and driver Hugo Garcia was a regular driver of the vehicle, not a special agent who was
performing a job or act foreign to his usual duties. Hence, the liability for the tortious act should. not be borne by
respondent government agency but by driver Garcia who should answer for the consequences of his act.
6. Even as the trial court touched on the failure or laxity of respondent National Irrigation Administration in
exercising due diligence in the selection and supervision of its employee, the matter of due diligence is not an issue
in this case since driver Garcia was not its special agent but a regular driver of the vehicle.
The sole legal question on whether or not petitioners may be entitled to an award of moral and exemplary damages
and attorney's fees can very well be answered with the application of Arts. 2176 and 2180 of theNew Civil Code.
Art. 2176 thus provides:
Whoever by act omission causes damage to another, there being fault or negligence, is obliged to pay for damage
done. Such fault or negligence, if there is no pre-existing cotractual relation between the parties, is called a quasidelict and is governed by the provisions of this Chapter
Paragraphs 5 and 6 of Art. 21 80 read as follows:
Employers shall be liable for the damages caused by their employees and household helpers acting within the
scope of their assigned tasks, even the though the former are not engaged in any business or industry.
The State is responsible in like manner when it acts through a special agent.; but not when the damage has been
caused by the official to whom the task done properly pertains, in which case what is provided in Art. 2176 shall be
applicable.
The liability of the State has two aspects. namely:
1. Its public or governmental aspects where it is liable for the tortious acts of special agents only.
2. Its private or business aspects (as when it engages in private enterprises) where it becomes liable as an ordinary
employer. (p. 961, Civil Code of the Philippines; Annotated, Paras; 1986 Ed. ).
In this jurisdiction, the State assumes a limited liability for the damage caused by the tortious acts or conduct of its
special agent.
Under the aforequoted paragrah 6 of Art. 2180, the State has voluntarily assumed liability for acts done through
special agents. The State's agent, if a public official, must not only be specially commissioned to do a particular task
but that such task must be foreign to said official's usual governmental functions. If the State's agent is not a public
official, and is commissioned to perform non-governmental functions, then the State assumes the role of an
ordinary employer and will be held liable as such for its agent's tort. Where the government commissions a private
individual for a special governmental task, it is acting through a special agent within the meaning of the provision.
(Torts and Damages, Sangco, p. 347, 1984 Ed.)

Certain functions and activities, which can be performed only by the government, are more or less generally agreed
to be "governmental" in character, and so the State is immune from tort liability. On the other hand, a service which
might as well be provided by a private corporation, and particularly when it collects revenues from it, the function is
considered a "proprietary" one, as to which there may be liability for the torts of agents within the scope of their
employment.
The National Irrigation Administration is an agency of the government exercising proprietary functions, by express
provision of Rep. Act No. 3601. Section 1 of said Act provides:
Section 1. Name and domicile.-A body corporate is hereby created which shall be known as the National Irrigation
Administration, hereinafter called the NIA for short, which shall be organized immediately after the approval of this
Act. It shall have its principal seat of business in the City of Manila and shall have representatives in all provinces
for the proper conduct of its business.
Section 2 of said law spells out some of the NIA's proprietary functions. ThusSec. 2. Powers and objectives.-The NIA shall have the following powers and objectives:
(c) To collect from the users of each irrigation system constructed by it such fees as may be necessary to finance
the continuous operation of the system and reimburse within a certain period not less than twenty-five years cost of
construction thereof; and
d) To do all such other tthings and to transact all such business as are directly or indirectly necessary, incidental or
conducive to the attainment of the above objectives.
Indubitably, the NIA is a government corporation with juridical personality and not a mere agency of the
government. Since it is a corporate body performing non-governmental functions, it now becomes liable for the
damage caused by the accident resulting from the tortious act of its driver-employee. In this particular case, the NIA
assumes the responsibility of an ordinary employer and as such, it becomes answerable for damages.
This assumption of liability, however, is predicated upon the existence of negligence on the part of respondent NIA.
The negligence referred to here is the negligence of supervision.
At this juncture, the matter of due diligence on the part of respondent NIA becomes a crucial issue in determining
its liability since it has been established that respondent is a government agency performing proprietary functions
and as such, it assumes the posture of an ordinary employer which, under Par. 5 of Art. 2180, is responsible for the
damages caused by its employees provided that it has failed to observe or exercise due diligence in the selection
and supervision of the driver.
It will be noted from the assailed decision of the trial court that "as a result of the impact, Francisco Fontanilla
was thrown to a distance 50 meters away from the point of impact while Restituto Deligo was thrown a little bit
further away. The impact took place almost at the edge of the cemented portion of the road." (Emphasis supplied,)
[page 26, Rollo]
The lower court further declared that "a speeding vehicle coming in contact with a person causes force and impact
upon the vehicle that anyone in the vehicle cannot fail to notice. As a matter of fact, the impact was so strong as
shown by the fact that the vehicle suffered dents on the right side of the radiator guard, the hood, the fender and a
crack on the radiator as shown by the investigation report (Exhibit "E"). (Emphasis supplied) [page 29, Rollo]
It should be emphasized that the accident happened along the Maharlika National Road within the city limits of San
Jose City, an urban area. Considering the fact that the victim was thrown 50 meters away from the point of impact,
there is a strong indication that driver Garcia was driving at a high speed. This is confirmed by the fact that the
pick-up suffered substantial and heavy damage as above-described and the fact that the NIA group was then "in a
hurry to reach the campsite as early as possible", as shown by their not stopping to find out what they bumped as
would have been their normal and initial reaction.
Evidently, there was negligence in the supervision of the driver for the reason that they were travelling at a high
speed within the city limits and yet the supervisor of the group, Ely Salonga, failed to caution and make the driver
observe the proper and allowed speed limit within the city. Under the situation, such negligence is further
aggravated by their desire to reach their destination without even checking whether or not the vehicle suffered
damage from the object it bumped, thus showing imprudence and reckelessness on the part of both the driver and
the supervisor in the group.

Significantly, this Court has ruled that even if the employer can prove the diligence in the selection and supervision
(the latter aspect has not been established herein) of the employee, still if he ratifies the wrongful acts, or take no
step to avert further damage, the employer would still be liable. (Maxion vs. Manila Railroad Co., 44 Phil. 597).
Thus, too, in the case of Vda. de Bonifacio vs. B.L.T. Bus Co. (L-26810, August 31, 1970, 34 SCRA 618), this Court
held that a driver should be especially watchful in anticipation of others who may be using the highway, and his
failure to keep a proper look out for reasons and objects in the line to be traversed constitutes negligence.
Considering the foregoing, respondent NIA is hereby directed to pay herein petitioners-spouses the amounts of
P12,000.00 for the death of Francisco Fontanilla; P3,389.00 for hospitalization and burial expenses of the
aforenamed deceased; P30,000.00 as moral damages; P8,000.00 as exemplary damages and attorney's fees of
20% of the total award.
FONTANILLA v. MALIAMAN
FACTS: A pick up owned by the National Irrigation Administration and driven officially by its regular driver, Hugo
Garcia, bumped a bicycle ridden by Francisco Fontanilla, which resulted in the latter's death. The parents of
Francisco filed a suit for damages against Garcia and the NIA, as Garcia's employer. After trial, the court awarded
actual, moral and exemplary damages to Spouses Fontanilla. NIA appealed. The Solicitor General contends that the
NIA does not perform solely and primarily proprietary functions but is an agency of the government tasked with
governmental functions, and is therefore not liable for the tortious act of its driver Hugo Garcia, who was not its
special agent.

ISSUE: May NIA, a government agency, be held liable for the damages caused by the negligent act of its driver
who was not its special agent?
HELD: Yes. NIA is a government agency with a juridical personality separate and distinct from the government. It is
not a mere agency of the government but a corporate body performing proprietary functions. Therefore, it may be
held liable for the damages caused by the negligent act of its driver who was not its special agent. (Fontanilla vs.
Maliaman, G.R. Nos. L-55963 & 61045, February 27, 1991)
RATIO:
Section 1 of RA No. 3601 tells us that NIA is a government agency invested with a corporate personality separate
and distinct from the government, thus is governed by the Corporation Law. Section 2, subsection f of PD 552
provides that NIA also has its own assets and liabilities and has corporate powers to be exercised by a Board of
Directors. Section 2, subsection b of PD 552 provides that NIA may sue and be sued in court.
Of equal importance is the case of National Waterworks and Sewerage Authority (NAWASA) vs. NWSA
Consolidated Unions, 11 SCRA 766, which propounds the thesis that "the NAWASA is not an agency performing
governmental functions; rather it performs proprietary functions . . . ." The functions of providing water supply and
sewerage service are regarded as mere optional functions of government even though the service rendered caters
to the community as a whole and the goal is for the general interest of society.
Like the NAWASA, the National Irrigation Administration was not created for purposes of local government. While it
may be true that the NIA was essentially a service agency of the government aimed at promoting public interest
and public welfare, such fact does not make the NIA essentially and purely a "government-function" corporation.
NIA was created for the purpose of "constructing, improving, rehabilitating, and administering all national irrigation
systems in the Philippines, including all communal and pump irrigation projects." Certainly, the state and the
community as a whole are largely benefited by the services the agency renders, but these functions are only
incidental to the principal aim of the agency, which is the irrigation of lands.
NOTES:
The liability of the State has two aspects. namely:
1. Its public or governmental aspects where it is liable for the tortious acts of special agents only.
2. Its private or business aspects (as when it engages in private enterprises) where it becomes liable as an ordinary
employer. Fontanilla vs. Maliaman, G.R. Nos. L-55963 & 61045, December 1, 1989)