On January 20, 1915, Cangco was riding the train of Manila Railroad Co (MRC).

He was an
employee of the latter and he was given a pass so that he could ride the train for free. When he
was nearing his destination at about 7pm, he arose from his seat even though the train was not
at full stop. When he was about to alight from the train (which was still slightly moving) he
accidentally stepped on a sack of watermelons which he failed to notice due to the fact that it
was dim. This caused him to lose his balance at the door and he fell and his arm was crushed by
the train and he suffered other serious injuries. He was dragged a few meters more as the train
slowed down.

It was established that the employees of MRC were negligent in piling the sacks of watermelons.
MRC raised as a defense the fact that Cangco was also negligent as he failed to exercise
diligence in alighting from the train as he did not wait for it to stop.

ISSUE: Whether or not Manila Railroad Co is liable for damages.

HELD: Yes. Alighting from a moving train while it is slowing down is a common practice and a
lot of people are doing so every day without suffering injury. Cangco has the vigor and agility of
young manhood, and it was by no means so risky for him to get off while the train was yet
moving as the same act would have been in an aged or feeble person. He was also ignorant of
the fact that sacks of watermelons were there as there were no appropriate warnings and the
place was dimly lit.

The Court also elucidated on the distinction between the liability of employers under Article 2180
and their liability for breach of contract [of carriage]:

FACTS:

On January 20, 1915, Jose Cangco was riding the train of Manila Railroad Company where he
was an employee. As the train drew near to his destination, he arose from his seat. When he
was about to alight from the train, Cangco accidentally stepped on a sack of watermelons which
he failed to notice because it was already 7:00pm and it was dim when it happened. As a result,
he slipped and fell violently on the platform. His right arm was badly crushed and lacerated
which was eventually amputated.

Cangco sued Manila Railroad Company on the ground of negligence of its employees placing
the sacks of melons upon the platform and in leaving them so placed as to be a menace to the
security of passenger alighting from the companys trains.
The companys defense was that granting that its employees were negligent in placing an
obstruction upon the platform, the direct and proximate cause of the injury suffered by plaintiff
was his own contributing negligence.

ISSUE: Whether or not there was a contributing negligence on the part of the plaintiff.

HELD: In determining the question of contributory negligence in performing such act that is to
say, whether the passenger acted prudently or recklessly the age, sex, and physical condition
of the passenger are circumstances necessarily affecting the safety of the passenger, and
should be considered.

The place was perfectly familiar to the plaintiff as it was his daily custom to get on and off the
train at the station. There could, therefore, be no uncertainty in his mind with regard either to the
length of the step which he was required to take or the character of the platform where he was
alighting. The Supreme Courts conclusion was that the conduct of the plaintiff in undertaking to
alight while the train was yet slightly under way was not characterized by imprudence and that
therefore he was not guilty of contributory negligence.

Far East Bank and Trust Company, petitioner

vs Court of Appeals, Luisa Luna and Clarita Luna, respondents
Ponente: Vitug

Facts:
Luis Luna applied for a far east card issued by far east bank at its Pasig branch. Upon his
request, the bank also issued a supplemental card to private respondent Clarita Luna. Then
Clarita lost her credit card and submitted an affidavit of loss. Later on October 6, 1988 in a
restaurant, Luis' credit card was not honored.

Luis thru a counsel then demanded from far east to pay damages for the humiliation he felt. The
vice-president of the bank expressed bank's apologies to Luis.

Still evidently feeling aggrieved, private respondents, on 05 December 1988, filed a complaint for
damages with the Regional Trial Court ("RTC") of Pasig against FEBTC.
On 30 March 1990, the RTC of Pasig, given the foregoing factual settings, rendered a decision
ordering FEBTC to pay private respondents (a) P300,000.00 moral damages; (b) P50,000.00
exemplary damages; and (c) P20,000.00 attorney's fees.
On appeal to the Court of Appeals, the appellate court affirmed the decision of the trial court.
Its motion for reconsideration having been denied by the appellate court, FEBTC has come to
this Court with this petition for review.

There is merit in this appeal.

In culpa contractual, moral damages may be recovered where the defendant is shown to have
acted in bad faith or with malice in the breach of the contract. The Civil Code provides:
Art. 2220. Willful injury to property may be a legal ground for awarding moral damages if the
court should find that, under the circumstances, such damages are justly due. The same rule
applies to breaches of contract where the defendant acted fraudulently or in bad faith.

Bad faith, in this context, includes gross, but not simple, negligence. Exceptionally, in a contract
of carriage, moral damages are also allowed in case of death of a passenger attributable to the
fault (which is presumed) of the common carrier.

Held:
The Court has not in the process overlooked another rule that a quasi-delict can be the cause for
breaching a contract that might thereby permit the application of applicable principles on tort 9
even where there is a pre-existing contract between the plaintiff and the defendant. This
doctrine, unfortunately, cannot improve private respondents' case for it can aptly govern only
where the act or omission complained of would constitute an actionable tort independently of the
contract. The test (whether a quasi-delict can be deemed to underlie the breach of a contract)
can be stated thusly: Where, without a pre-existing contract between two parties, an act or
omission can nonetheless amount to an actionable tort by itself, the fact that the parties are
contractually bound is no bar to the application of quasi-delict provisions to the case. Here,
private respondents' damage claim is predicated solely on their contractual relationship; without
such agreement, the act or omission complained of cannot by itself be held to stand as a
separate cause of action or as an independent actionable tort.

In October, 1986, Luis applied for and was granted a credit card by FAREASTCARD. His wife,

Clarita, was also issued a supplementary card per his request. In August, 1988, Clarita lost her

supplementary card, and promptly filed an affidavit of loss with the company. Per company

policy of the bank, her card as well as the principal card of Luis were placed on the Hot Card or

Cancelled Card list.

On Ocober 6, 1998, Luis tendered a despedida lunch for a close friend and another guest at a

restaurant within a posh hotel. When he paid for the lunch, he presented his credit card issued

by the company. It was dishonored, thus, he was left with no recourse but to pay the bill in cash.

After the incident, Luis wrote the company to complain and to ask for damages. One of the

banks vice presidents wrote Luis a letter of apology, and explained that because of the loss of

Claritas card, it took necessary action to protect its cardholders. However, Luis was not

informed of this security policy. An overzealous employee also did not consider that it may have
been Luis who presented his card, thus resulting to the unfortunate incident. He also wrote the

restaurant management, assuring them that Luis is a valued client of the bank.

Nevertheless, Luis still filed an action for damages against the bank. After trial, the RTC awarded

to Luis P300,000.00 in moral damages, P50,000.00 in exemplary damages, and P20,000,00 in

attorneys fees. The Court of Appeals affirmed the RTC decision.

In view of the factual circumstances, did the trial court correctly award moral and exemplary

damages as well as attorneys fees to Luis?

In culpa contractual, moral damages may be recovered where the defendant is shown to have

acted in bad faith or with malice in the breach of the contract. The Civil Code provides:

Art. 2220. Willful injury to property may be a legal ground for awarding moral damages if the

court should find that, under the circumstances, such damages are justly due. The same rule

applies to breaches of contract where the defendant acted fraudulently or in bad faith.

(Emphasis supplied)

Bad faith, in this context, includes gross, but not simple, negligence. Exceptionally, in a contract

of carriage, moral damages are also allowed in case of death of a passenger attributable to the

fault (which is presumed ) of the common carrier.

Concededly, the bank was remiss in indeed neglecting to personally inform Luis of his own

cards cancellation. Nothing in the findings of the trial court and the appellate court, however, can

sufficiently indicate any deliberate intent on the part of FEBTC to cause harm to private

respondents. Neither could FEBTCs negligence in failing to give personal notice to Luis be

considered so gross as to amount to malice or bad faith.

Malice or bad faith implies a conscious and intentional design to do a wrongful act for a

dishonest purpose or moral obliquity; it is different from the negative idea of negligence in that

malice or bad faith contemplates a state of mind affirmatively operating with furtive design or ill

will.
 xxx

Exemplary or corrective damages, in turn, are intended to serve as an example or as correction

for the public good in addition to moral, temperate, liquidated or compensatory damages (Art.

2229, Civil Code; see Prudenciado vs. Alliance Transport System, 148 SCRA 440; Lopez vs.

Pan American World Airways, 16 SCRA 431). In criminal offenses, exemplary damages are

imposed when the crime is committed with one or more aggravating circumstances (Art. 2230,

Civil Code). In quasi-delicts, such damages are granted if the defendant is shown to have been

so guilty of gross negligence as to approximate malice (See Art. 2231, Civil Code; CLLC E.G.

Gochangco Workers Union vs. NLRC, 161 SCRA 655; Globe Mackay Cable and Radio Corp. vs.

CA, 176 SCRA 778). In contracts and quasi-contracts, the court may award exemplary damages

if the defendant is found to have acted in a wanton, fraudulent, reckless, oppressive, or

malevolent manner (Art. 2232, Civil Code; PNB vs. Gen. Acceptance and Finance Corp., 161

SCRA 449).

Given the above premises and the factual circumstances here obtaining, it would also be just as

arduous to sustain the exemplary damages granted by the courts below (see De Leon vs. Court

of Appeals, 165 SCRA 166).

Nevertheless, the banks failure, even perhaps inadvertent, to honor its credit card issued to

private respondent Luis should entitle him to recover a measure of damages sanctioned under

Article 2221 of the Civil Code providing thusly:

Art. 2221. Nominal damages are adjudicated in order that a right of the plaintiff, which has been

violated or invaded by the defendant, may be vindicated or recognized, and not for the purpose

of indemnifying the plaintiff for any loss suffered by him.

Reasonable attorneys fees may be recovered where the court deems such recovery to be just

and equitable (Art. 2208, Civil Code). We see no issue of sound discretion on the part of the

appellate court in allowing the award thereof by the trial court.

WHEREFORE, the petition for review is given due course. The appealed decision is MODIFIED

by deleting the award of moral and exemplary damages to private respondents; in its stead,

petitioner is ordered to pay private respondent Luis A. Luna an amount of P5,000.00 by way of

nominal damages. In all other respects, the appealed decision is AFFIRMED. No costs.

Ligon
Issue: WON a person feed from criminal liability is also freed from civil liability

Ruling: Accused acquitted but held civilly liable for his acts and omissions, there being fault and
negligence.

Ratio: It does not follow that a person who is not criminally liable is also free from civil liability. While the
guilt must be established beyond reasonable doubt in a criminal prosecution, only preponderance of
evidence is required in a civil action.
On the basis of the trial courts evaluation of the testimonies of both prosecution and defense witness at
the trial and applying the quantum of proof required in civil cases, We find that a preponderance of
evidence establishes that Gabat by his act and omission with fault and negligence caused damage to
Rosales and should answer civilly for the damage done.