VIII.
HUMAN RELATIONS not, however, leave private respondent with no relief because
Globe Mackay v. CA 176 SCRA 778 (August 25, 1989)
Facts: Restituto M. Tobias, the private respondent, was
employed by petitioner Globe Mackay Cable and Radio
Corporation (GLOBE MACKAY) in a dual capacity as a
purchasing agent and administrative assistant to the
engineering operations manager. In 1972, GLOBE MACKAY
discovered fictitious purchases and other fraudulent
transactions for which it lost several thousands of pesos.
According to Tobias it was him who actually discovered the
anomalies and reported them on November 10, 1972 to his
immediate superior Eduardo T. Ferraren and to petitioner
Herbert C. Hendry who was then the Executive Vice-President
and General Manager of GLOBE MACKAY. However, his
superiors twisted the facts and alleged that it was Tobias who
was their number one suspect. This led to the different
investigations including a lie detector test to make Tobias admit
something he did not do. He was later on dismissed by Globe
Mackay. Unemployed, Tobias tried applying for a new job in
RETELCO. However, the petitioner, without being asked by
RETELCO, wrote a letter to the latter stating that Tobias was
dismissed by GLOBE MACKAY due to dishonesty. Tobias filed a
civil case. The RTC awarded damages and the Court of
Appeals affirmed said judgment.
Issue: Whether or not petitioners are liable for damages to
private respondent.
Held: Yes. An employer who harbors suspicions that an
employee has committed dishonesty might be justified in taking
the appropriate action such as ordering an investigation and
directing the employee to go on a leave. Firmness and the
resolve to uncover the truth would also be expected from such
employer. But the high-handed treatment accorded Tobias by
petitioners was certainly uncalled for. Petitioners contend that
they could not be made liable for damages in the lawful
exercise of their right to dismiss private respondent. This does
Article 21 of the Civil Code provides that: Art. 21. Any person
who wilfully causes loss or injury to another in a manner that is
contrary to morals, good customs or public policy shall
compensate the latter for the damage. Several other tortious
acts were committed by petitioners against Tobias after the
latter's termination from work. The damage incurred by Tobias
was not only in connection with the abusive manner in which he
was dismissed but was also the result of several other quasi-
delictual acts committed by petitioners such as the filing of six
criminal complaints which amount to malicious prosecution.
Albenson v. CA G.R. No. 88694 (January 11, 1993)
Facts: Albenson Enterprises delivered to Guaranteed Industries
mild steel plates and as payment, it was paid with a check
amounting to P2,575 drawn against the account of E.L
Woodworks. The check was dishonored, Albenson, traced the
origin of the check. The result from the SEC shows that the
president of Guaranteed Industries and the owner of E.L
Woodworks were one and the same with the name of Eugenio
S. Baltao. Albenson made extrajudicial demand but Eugenio
Baltao denied that he issued a check, urging the petitioner to
file a complaint through Fiscal Sumaway for violation of BP 22.
Fiscal Sumaway claimed that he had given Eugenio S. Baltao
opportunity to submit controverting evidence, but the latter
failed to do so and therefore, was deemed to have waived his
right. Respondent Baltao, claiming ignorance of the complaint
against him, immediately filed with the Provincial Fiscal of Rizal a
motion for reinvestigation, alleging that it was not true that he
had been given an opportunity to be heard in the preliminary
investigation conducted by Fiscal Sumaway, and that he never
had any dealings with Albenson. The complaint of Albenson
was dismissed and Baltao’s complaint was given merit and the
RTC ruled in favor of him.
Issue: Whether or not Eugene Baltao is entitled to such
damages for abuse of rights and malicious prosecution..

Held: No, the SC found no cogent reason to award such
damages in favor of Eugene Baltao. Article 19, known to
contain what is commonly referred to as the principle of abuse
of rights, sets certain standards which may be observed not only
in the exercise of one's rights but also in the performance of
one's duties. These standards are the following: to act with
justice; to give everyone his due; and to observe honesty and
good faith. The law, therefore, recognizes the primordial
limitation on all rights: that in their exercise, the norms of human
conduct set forth in Article 19 must be observed. A right, though
by itself legal because recognized or granted by law as such,
may nevertheless become the source of some illegality. When a
right is exercised in a manner which does not conform with
norms enshrined in Article 19 and results in damage to another,
a legal wrong is thereby committed for which the wrongdoer
must be held responsible . . . ." What prompted petitioners to file
the case for violation of Batas Pambansa Bilang 22 against
private respondent was their failure to collect the amount of
P2,575.00 due on a bounced check which they honestly
believed was issued to them by private respondent. It appears
however, that there was a mistake in identity as there were
three (3) men having the name Eugenio Baltao that were all
doing business in the building where E.L Woodworks was
situated. It was most probably the son, Eugene Baltao III who
issued the check to Albenson, which Mr. Eugene Baltao never
during the investigation. The mere act of submitting a case to
the authorities for prosecution does not make one liable for
malicious prosecution. An award of damages and attorney's
fees is unwarranted where the action was filed in good faith. If
damage results from a person's exercising his legal rights, it is
damnum absque injuria. Nor is he entitled to compensatory
damages because he did not present proof of the cost of the
medical treatment which he claimed to have undergone as a
result of the nervous breakdown he suffered, nor did he present
proof of the actual loss to his business caused by the unjust
litigation against him. In determining actual damages, the court
cannot rely on speculation, conjectures or guesswork as to the
amount. Without the actual proof of loss, the award of actual
damages becomes erroneous. There is no evidence of the
other party having acted in wanton, fraudulent or reckless, or
oppressive manner, neither may exemplary damages be
awarded (Dee Hua Liong Electrical Equipment Corporation vs.
Reyes, 145 SCRA 488 [1986]).The award of attorney's fees must
be disallowed where the award of exemplary damages is
eliminated (Article 2208, Civil Code; Agustin vs. Court of
Appeals, 186 SCRA 375 [1990]). Moreover, there was no
malicious prosecution against private respondent, attorney's
fees cannot be awarded him on that ground.
Amonoy v. Gutierrez 351 SCRA 731 (2001)
Facts: The house of spouses Gutierrez was situated in a lot
foreclosed and bought by Sergio Amonoy. In April and May
1986, an Order of Demolition of the house was issued by the trial
court but was enjoined by a temporary restraining order (TRO)
granted to respondents on June 2, 1986. In 1988, the TRO was
made permanent by the Court, but the house of respondents
had already been destroyed. The Court of Appeals held
petitioner liable to respondents for P250,000.00 for actual
damages thereof. Hence, the appeal to the SC where
petitioner asserted the principle of damnum absque injuria.
Issue: Whether or not the Court of Appeals was correct in
deciding that the Amonoy was liable to the respondents for
damages
Held: Yes. Amonoy invoke es the principle of damnun absque
injuria, the maxim that damage resulting from the legitimate
exercise of a person's rights is a loss without injury for which the
law gives no remedy. In other words, one who merely exercises
one's rights does no actionable injury and cannot be held liable
for damages. The SC finds damnum absque injuria not
applicable to this case. Amonoy did not heed to the TRO issued
by the Court. He was already in bad faith when he continued
the demolition despite the issuance of a TRO. The demolition of
respondents' house by petitioner, despite his receipt of the TRO,
was not only an abuse but also an unlawful exercise of such
right. Amonoy’s liability is premised on the obligation to repair or
to make whole the damage caused to another by reason of
one's act or omission, whether done intentionally or negligently
and whether or not punishable by law.
UE v. Jader G.R. No. 132344 (2000)
Facts: Romeo Jader, a law student enrolled in the University of
the East, failed to take the regular final examination in Practice
Court I for which he was given an incomplete grade in the 1st
semester of his last year (1987- 1988). After completing his 2nd
semester, Jader filed an application for the removal of the
incomplete grade given him by Professor Carlos Ortega. This
was approved by Dean Celedonio Tiongson after paying the
required fee. He took the examination, and on May 30, 1988,
Professor Carlos Ortega submitted his grade, a five (5).
Deliberations were held, with Jader’s name appearing in the
tentative list of candidates for graduation, but annotated with
his deficiencies. Invitations were also made, with Jader’s name
appearing as one of the candidates, albeit annotated as to the
tentative nature of the list. Jader attended the said graduation
ceremony, vested with all the rites symbolic of his graduation
from law school. Believing he had successfully graduated, he
took a leave of absence without pay to prepare for the bar
examination. Upon his enrollment in the pre-bar review of the
Far Eastern University, however, Jader learned of his deficiency,
dropped out of the same and ultimately did not take the bar
examination. Jader sued UE for damages for suffering moral
shock, mental anguish, serious anxiety, besmirched reputation,
wounded feelings and sleepless nights arising from the latter’s
negligence. Awards of moral and exemplary damages,
unrealized income, attorney’s fees, and costs of suit were also
prayed for.
UE denied liability, arguing that it never led Jader to believe
that he completed the requirements for a Law degree when his
name was included in the tentative list of graduating students.
Trial ensued, with the lower court ruling in favor of Jader,
ordering UE to pay 35,470 with legal rate of interest, and 5,000
for attorney’s fees and cost of suit. This was modified by the CA
to the effect of requiring UE to pay Jader an additional 50,000
for moral damages.
Issue: Is UE liable to Romeo Jader, despite the former’s
allegation that the proximate and immediate cause of the
alleged damages incurred arose out of his own negligence in
not verifying the result of his removal exam?
Held: UE is still liable to respondent Jader. In a contract of
education, since the contracting parties are the school and the
student, the latter is not dutybound to deal with the formers
agents, although nothing prevents either professors or students
from sharing with each other such information. It is the
contractual obligation of the school to timely inform and furnish
sufficient notice and information to each and every student as
to whether he or she had already complied with all the
requirements for the conferment of a degree or whether they
would be included among those who will graduate. In
belatedly informing Jader, UE cannot be said to have acted in
good faith. Absence of good faith must be sufficiently
established for a successful prosecution by the aggrieved party
in a suit for abuse of right under Article 19 of the Civil Code. It
connotes an honest intention to abstain from taking undue
advantage of another, even though the forms and
technicalities of the law, together with the absence of all
information or belief of facts, would render the transaction
unconscientious. The school exercises general supervision and
exclusive control over the professors with respect to the
submission of reports involving the students standing, with
“exclusive control” meaning that no other person or entity had
any control over the instrumentality which caused the damage
or injury. Being a university engaged in legal education, it should
have practiced what it inculcates in its students, specifically the
principle of good dealings in Articles 19 and 20 of the Civil
Code, the former provision intended to expand the concept of
torts by granting adequate legal remedy for the untold number
of moral wrongs, impossible for human foresight to provide
specifically in statutory law. UE failed to act seasonably and
cannot feign ignorance that Jader will not prepare himself for
the bar exams, since that is precisely the immediate concern
after graduation of an LL.B. graduate. Liability arose from its
failure to promptly inform him of the exam results and in
misleading the latter into believing that he had satisfied all
course requirements. While UE was guilty of negligence and
liable to Jader for actual damages, he should not have been
awarded moral damages. At the very least, it behooved on
Jader to verify whether he has completed all necessary
requirements to be eligible for the bar examinations. As a senior
law student, he should have been responsible enough to ensure
that all his affairs were in order. The Court fails to see how he
could have suffered untold embarrassment in attending the
graduation rites, enrolling in the bar review classes and not
being able to take the bar exams. If Jader was indeed
humiliated, he brought this upon himself by not verifying all the
requirements including his school records, before preparing
himself for the bar examination.
PANTALEON v AMERICAN EXPRESS INTERNATIONAL, INC
RATIO DECIDENDI: Moral damages avail in cases of breach of
contract where the defendant acted fraudulently or in bad
faith.
QUICK FACTS: Petitioner purchased items when he was in the
States using his AmEx credit card. During three particular
instances, clearance of his purchase took too long and under
those circumstances caused him moral shock, mental anguish,
serious anxiety, wounded feelings and social humiliation.
FACTS:
Name of Offended party (petitioner): Polo S. Pantaleon
Name of respondent: American Express International, Inc.
-The petitioner, lawyer Polo Pantaleon, his wife, daughter and
son joined an escorted tour of Western Europe organized by
Trafalgar Tours of Europe, Ltd., in October of 1991.
-The tour group arrived in Amsterdam in the afternoon of 25
October 1991, the second to the last day of the tour. As the
group had arrived late in the city, they failed to engage in any
sight-seeing so they agreed that they would start early the next
day to see the entire city before ending the tour.
-The following day, the last day of the tour, the group arrived at
the Coster Diamond House. The group had agreed that the visit
to Coster should end by 9:30 a.m. to allow enough time to take
in a guided city tour of Amsterdam.
- While in the diamond house, led to the store’s showroom to
allow them to select items for purchase. Mrs. Pantaleon
decided to buy a 2.5 karat diamond brilliant cut, and she found
a diamond close enough in approximation. Mrs. Pantaleon also
selected for purchase a pendant and a chain, all of which
totaled U.S. $13,826.00.
-Pantaleon presented his American Express credit card together
with his passport to the Coster sales clerk. This occurred at
around 9:15 a.m., or 15 minutes before the tour group was
slated to depart from the store. The sales clerk took the card’s
imprint, and asked Pantaleon to sign the charge slip. The
charge purchase was then referred electronically to
respondent’s Amsterdam office at 9:20 a.m.
-clearance took too long. At 9:40am, Pantaleon asked the store
clerk to cancel the sale to avoid further delaying and
inconveniencing the tour group. At around 10:00 a.m, 30
minutes after the tour group was supposed to have left the
store, Coster decided to release the items even without
respondent’s approval of the purchase.
-due to the delay, the city tour of Amsterdam was to be
canceled due to lack of remaining time. The spouses Pantaleon
allegedly offered their apologies but were met by their
tourmates with stony silence and visible irritation. Mrs. Pantaleon
ended up weeping, while her husband had to take a
tranquilizer to calm his nerves.
-two instances similar to the Castor incident happened.
 purchased golf equipment amounting to US $1,475.00
using his AmEx card, but he cancelled his credit card
purchase and borrowed money instead from a friend,
after more than 30 minutes had transpired without the
purchase having been approved.
 used the card to purchase children’s shoes worth $87.00
at a store in Boston, and it took 20 minutes before this
transaction was approved by respondent.
Petitioners: after coming back to Manila, sent a letter
demanding an apology for the "inconvenience, humiliation and
embarrassment he and his family thereby suffered" for
respondent’s refusal to provide credit authorization for the
aforementioned purchases.
Respondent: refused to give an apology, sent a letter stating
among others that the delay in authorizing the purchase from
Coster was attributable to the circumstance that the charged
purchase of US $13,826.00 "was out of the usual charge
purchase pattern established."
RTC: petitioner instituted an action for damages. Petitioner won.
 Court awarded P500,000.00 as moral
damages, P300,000.00 as exemplary
damages, P100,000.00 as attorney’s fees, and P85,233.01
as expenses of litigation.
 normal approval time for purchases was "a matter of
seconds." Based on that standard, respondent had been
in clear delay with respect to the three subject
transactions.
CA: reversed the award of damages in favor of Pantaleon,
holding that respondent had not breached its obligations to
petitioner.
 delay was not attended by bad faith, malice, or gross
negligence.
 respondent "had exercised diligent efforts to effect the
approval" of the purchases, which were "not in
accordance with the charge pattern" petitioner had
established for himself
ISSUE:
1) WON has committed a breach of its obligations.
2) WON respondent is liable for damages.
DECISION: Petition granted. CA decision set aside.
HELD:
1) There was a breach.
-Notwithstanding the popular notion that credit card purchases
are approved "within seconds," there really is no strict, legally
determinative point of demarcation on how long must it take
for a credit card company to approve or disapprove a
customer’s purchase, much less one specifically contracted
upon by the parties. Yet this is one of those instances when
"you’d know it when you’d see it," and one hour appears to be
an awfully long, patently unreasonable length of time to
approve or disapprove a credit card purchase.
-the respondent has the right, if not the obligation, to verify
whether the credit it is extending upon on a particular purchase
was indeed contracted by the cardholder, and that the
cardholder is within his means to make such transaction. The
culpable failure of respondent herein is not the failure to timely
approve petitioner’s purchase, but the more elemental failure
to timely act on the same, whether favorably or unfavorably.
 Respondent should have promptly informed petitioner
the reason for the delay, and duly advised him that
resolving the same could take some time so that
petitioners will know WON to continue with the purchases
2) YES.
-Moral damages avail in cases of breach of contract where the
defendant acted fraudulently or in bad faith, and the court
should find that under the circumstances, such damages are
due.
-in this case, there was bad faith and unjustified neglect of
respondent, attributable in particular to the "dilly-dallying" of
respondent’s Manila credit authorizer, Edgardo Jaurique. This, to
the Court’s mind, amounts to a wanton and deliberate refusal
to comply with its contractual obligations, or at least abuse of its
rights, under the contract.
-The delay committed by defendant was clearly attended by
unjustified neglect and bad faith, since it alleges to have
consumed more than one hour to simply go over plaintiff’s past
credit history with defendant, his payment record and his credit
and bank references, when all such data are already stored
and readily available from its computer and the fact that there
were no delinquencies in the plaintiff’s account
-It should be emphasized that the reason why petitioner is
entitled to damages is not simply because respondent incurred
delay, but because the delay, for which culpability lies under
Article 1170, led to the particular injuries under Article 2217 of
the Civil Code for which moral damages are remunerative. In
this case, it was sufficiently shown that the incident gave rise to
the moral shock, mental anguish, serious anxiety, wounded
feelings and social humiliation to the petitioner.
 Amount should be commensurate to the loss or injury
suffered. Petitioner’s original prayer for P5,000,000.00 for
moral damages is excessive under the circumstances,
and the amount awarded by the trial court
of P500,000.00 in moral damages more seemly.1avvphi1
-Likewise, we deem exemplary damages available under the
circumstances, and the amount of P300,000.00 appropriate.
There is similarly no cause though to disturb the determined
award of P100,000.00 as attorney’s fees, and P85,233.01 as
expenses of litigation.
CALIFORNIA CLOTHING, INC. vs. QUIÑONES
G.R. No. 175822 (October 23, 2013)
A. Legal Facts
Respondent, Shirley G. Quiñones, a ticketing agent of
Cebu Pacific Air, bought a pair of black jeans worth P2,098.00
from Guess USA Boutique. While she was on her way to Mercury
Drug Store, a Guess employee approached her and said that
she failed to pay for the black jeans. Nevertheless, she
presented an official receipt and suggested that they should
talk about the matter in the Cebu Pacific Office located within
the mall. While they were in the office, the Guess employees
allegedly humiliated her in front of the clients of Cebu Pacific,
repeatedly demanded payment and even searched the
respondent’s wallet to check how much money she had.
Another argument ensued and after that, respondent went
home. The Guess employees submitted two letters to the
Director of Cebu Pacific narrating the incident but the said
letters were not received.
Respondent filed a complaint for damages against the
petitioners, California Clothing, Inc., Excelsis Villagonzalo, Imelda
Hawayon and Michelle S. Ybañez, alleging that due to the
incident, she suffered physical anxiety, sleepless nights, mental
anguish, fright, serious apprehension, besmirched reputation,
moral shock and humiliation. She demanded payment for
moral, nominal, and exemplary damages, as well as attorney’s
fees and litigation expenses.
Petitioners stated that they approached the respondent
to clarify whether or not payment was made and that they
approached and talked to the respondent in a gentle and
polite manner. They sought payment for moral and exemplary
damages, attorney’s fees and litigation expenses as
counterclaim.
 The Regional Trial Court dismissed both the complaint
and counterclaim stating that the petitioners acted in good
faith and the respondent was the one who put herself in that
situation by inviting the Guess employees to the Cebu Pacific
Office to discuss about the issue of payment. However, the
Court of Appeals reversed and set aside the Regional Trial Court
decision stating that there was preponderance of evidence
showing the petitioners acted in bad faith but, Hawayon and
Villagonzalo were absolved from liability due to good faith.
Since petitioners acted in bad faith, respondent was entitled to
damages and attorney’s fees.
B. Legal Issue
Whether or not petitioners acted in bad faith which
resulted to the Court of Appeals awarding moral damages and
attorney’s fees to respondent, Shirley G. Quiñones.
C. Ruling
Yes, petitioners acted in bad faith and the award for
moral damages and attorney’s fees to respondent was proper.
The Supreme Court affirmed the Court of Appeals’ decision. The
principle of abuse of rights under Article 19 of the Civil Code is
present in the case. Respondent complained when petitioners
embarrassed her and insisted that she did not pay for the black
jeans despite the issuance of an official receipt in her favor.
The court cited the case of Carpio vs. Valmonte in which
the elements of abuse of rights were enumerated. “The
elements of abuse of rights are as follows: (1) there is a legal
right or duty; (2) which is exercised in bad faith; (3) for the sole
intent of prejudicing or injuring another.” The elements stated
are complete in the present case. First, petitioners continued to
insist that there was no payment made when respondent
already presented the black jeans with the original receipt.
Second, they accused the respondent that not only did she fail
to pay for the black jeans but she intentionally stole it and
quickly left the shop. Third, the letters sent to the respondent’s
employer was not only intended to ask for assistance in
collection of the payment but also to ruin the respondent’s
reputation.
The exercise of rights is subject to limitations. Thus, it must
be in accordance with the purpose of its establishment and not
abused.
Respondent was awarded P50,000.00 as moral damages
and P20,000.00 as attorney’s fees.
CASE 2014-0023: RAUL H. SESBRENO, Petitioner, -versus-
HONORABLE COURT OF APPEALS, JUAN I. COROMINA
(SUBSTITUTED BY ANITA COROMINA, ELIZABETH COROMINA and
ROSIEMARIE COROMINA), VICENTE E. GARCIA (SUBSTITUTED BY
EDGAR JOHN GARCIA), FELIPE CONSTANTINO, RONALD ARCILLA,
NORBETO ABELLANA, DEMETRIO BALICHA, ANGELITA LHUILLIER,
JOSE E. GARCIA, AND VISAY AN ELECTRIC COMPANY (VECO),
Respondents. (G.R. No. 160689, 26 MARCH 2014, BERSAMIN, J.)
SUBJECT/S: ABUSE OF RIGHTS. (BRIEF TITLE: SESBRENO VS. C.A.)
DISPOSITIVE:
WHEREFORE, the Court DENIES the pet1t1on for review on
certiorari; AFFIRMS the decision promulgated on March 10, 2003;
and DIRECTS the petitioner to pay the costs of suit.
SO ORDERED.
SUBJECTS/DOCTRINES/DIGEST:
THE VISAYAN ELECTRIC COMPANY (VECO) SENT A TEAM
TO INSPECT PETITIONER’S RESIDENCE FOR ALLEGED ELECTRIC
METER TAMPERING. PETITIONER ARGUED THAT SINCE THE TEAM
DID NOT HAVE A SEARCH WARRANT THEY VIOLATED SECTION 2,
ART 111 OF THE 1987 CONSTITUION WHICH GUARANTEES THE
RIGHT OF EVERY INDIVIDUAL AGAINST UNREASONABLE SEARCHES
AND SEIZURES. WHAT DOES SECTION 2 PROVIDES?
Section 2. The right of the people to be secure in their
persons, houses, papers and effects against unreasonable
searches and seizures of whatever nature and for any purpose
shall be inviolable, and no search warrant or warrant of arrest
shall issue except upon probable cause to be determined
personally by the judge after examination under oath or
affirmation of the complainant and the witnesses he may
produce, and particularly describing the place to be searched
and the persons or things to be seized.
XXXXXXXXXX
PETITIONER STATES THAT A VIOLATION OF THIS
CONSTITUTIONAL GUARANTY RENDERED VECO AND ITS VOS
TEAM LIABLE TO HIM FOR DAMAGES BY VIRTUE OF ARTICLE 32 (9)
OF THE CIVIL CODE, WHICH PERTINENTLY PROVIDES:
Article 32. Any public officer or employee, or any private
individual, who directly or indirectly obstructs, defeats, violates
or in any manner impedes or impairs any of the following rights
and liberties of another person shall be liable to the latter for
damages: x x x x (9) The right to be secured in one’s person,
house, papers, and effects against unreasonable searches and
seizures; x x x x.
IS PETITIONER’S CONTENTION CORRECT?
NO.
THE CONSTITUTIONAL GUARANTEE APPLIES ONLY IF THE
SEARCH WAS DONE BY THE GOVERNMENT. VECO AND ITS TEAM
ARE NOT GOVERNMENT AGENTS. NOT BEING AGENTS OF THE
STATE, THEY DID NOT HAVE TO FIRST OBTAIN A SEARCH WARRANT
TO DO SO.
The constitutional guaranty against unlawful searches
and seizures is intended as a restraint against the Government
and its agents tasked with law enforcement. It is to be invoked
only to ensure freedom from arbitrary and unreasonable
exercise of State power. The Court has made this clear in its
pronouncements, including that made in People v. Marti,17 viz:
If the search is made upon the request of law enforcers,
a warrant must generally be first secured if it is to pass the test of
constitutionality. However, if the search is made at the behest or
initiative of the proprietor of a private establishment for its own
and private purposes, as in the case at bar, and without the
intervention of police authorities, the right against unreasonable
search and seizure cannot be invoked for only the act of
private individual, not the law enforcers, is involved. In sum, the
protection against unreasonable searches and seizures cannot
be extended to acts committed by private individuals so as to
bring it within the ambit of alleged unlawful intrusion by the
government.
XXXXXXXXXX

BUT BALICHA A TEAM MEMBER WAS A POLICEMAN. DID
HIS PRESENCE NOT MAKE THE SEARCH AS A SEARCH BY
GOVERNMENT AGENT?
NO. HIS ROLE THERE WAS NOT TO SEARCH BUT ONLY TO
PROVIDE SECURITY FOR THE TEAM.
Balicha’s presence participation in the entry did not
make the inspection a search by an agent of the State within
the ambit of the guaranty. As already mentioned, Balicha was
part of the team by virtue of his mission order authorizing him to
assist and escort the team during its routine inspection.19
Consequently, the entry into the main premises of the house by
the VOC team did not constitute a violation of the guaranty.
XXXXXXXXXX
WHAT IS THE CONCEPT OF ABUSE OF RIGHTS.
IT PRESCRIBES THAT THAT A PERSON SHOULD NOT USE HIS
RIGHT UNJUSTLY OR IN BAD FAITH; OTHERWISE, HE MAY BE LIABLE
TO ANOTHER WHO SUFFERS INJURY.
XXXXXXXXXX
WHAT IS THE RATIONALE FOR SUCH CONCEPT?
TO PRESENT SOME BASIC PRINCIPLES TO BE FOLLOWED
FOR THE RIGHTFUL RELATIONSHIP BETWEEN HUMAN BEINGS AND
THE STABILITY OF SOCIAL ORDER.
XXXXXXXXXX
WHEN DOES SUCH ABUSE OF RIGHTS END?
WHEN THE RIGHT DISAPPEARS, AND IT DISAPPEARS WHEN
IT IS ABUSED, ESPECIALLY TO THE PREJUDICE OF OTHERS[;] IT
CANNOT BE SAID THAT A PERSON EXERCISES A RIGHT WHEN HE
UNNECESSARILY PREJUDICES ANOTHER.”
XXXXXXXXXX
WHAT ARE THE STANDARDS TO BE OBSERVED IN THE
EXERCISE OF ONE’S RIGHTS AND IN THE PERFORMANCE OF
ONE’S DUTIES?
ACCORDING TO ART. 19 OF THE CIVIL CODE THE
STANDARDS ARE:
(A) TO ACT WITH JUSTICE;
(B) TO GIVE EVERYONE HIS DUE; AND
 (C) TO OBSERVE HONESTY AND GOOD FAITH. THE LAW
THEREBY RECOGNIZES THE PRIMORDIAL LIMITATION ON ALL
RIGHTS – THAT IN THE EXERCISE OF THE RIGHTS, THE STANDARDS
UNDER ARTICLE MUST BE OBSERVED.
XXXXXXXXXX
MUST THE ACT BE ILLEGAL IN ORDER THAT THERE BE ABUSE
OF RIGHTS?
ALTHOUGH THE ACT IS NOT ILLEGAL, LIABILITY FOR
DAMAGES MAY ARISE SHOULD THERE BE AN ABUSE OF RIGHTS,
LIKE WHEN THE ACT IS PERFORMED WITHOUT PRUDENCE OR IN
BAD FAITH.
XXXXXXXXXX
IN ORDER THAT LIABILITY MAY ATTACH UNDER THE
CONCEPT OF ABUSE OF RIGHTS, WHAT ARE THE ELEMENTS THAT
MUST BE PRESENT?
THE FOLLOWING ELEMENTS MUST BE PRESENT:
(A) THE EXISTENCE OF A LEGAL RIGHT OR DUTY,
(B) WHICH IS EXERCISED IN BAD FAITH, AND
(C) FOR THE SOLE INTENT OF PREJUDICING OR INJURING
ANOTHER.
THERE IS NO HARD AND FAST RULE THAT CAN BE APPLIED
TO ASCERTAIN WHETHER OR NOT THE PRINCIPLE OF ABUSE OF
RIGHTS IS TO BE INVOKED. THE RESOLUTION OF THE ISSUE
DEPENDS ON THE CIRCUMSTANCES OF EACH CASE.
XXXXXXXXXX
Clearly, Sesbreño did not establish his claim for damages
if the respondents were not guilty of abuse of rights. To stress,
the concept of abuse of rights prescribes that a person should
not use his right unjustly or in bad faith; otherwise, he may be
liable to another who suffers injury. The rationale for the
concept is to present some basic principles to be followed for
the rightful relationship between human beings and the stability
of social order.21 Moreover, according to a commentator, 22
“the exercise of right ends when the right disappears, and it
disappears when it is abused, especially to the prejudice of
others[;] [i]t cannot be said that a person exercises a right when
he unnecessarily prejudices another.” Article 19 of the Civil
Code23 sets the standards to be observed in the exercise of
one’s rights and in the performance of one’s duties, namely: (a)
to act with justice; (b) to give everyone his due; and (c) to
observe honesty and good faith. The law thereby recognizes
the primordial limitation on all rights – that in the exercise of the
rights, the standards under Article 19 must be observed.24
Although the act is not illegal, liability for damages may
arise should there be an abuse of rights, like when the act is
performed without prudence or in bad faith. In order that
liability may attach under the concept of abuse of rights, the
following elements must be present, to wit: (a) the existence of
a legal right or duty, (b) which is exercised in bad faith, and (c)
for the sole intent of prejudicing or injuring another.25 There is no
hard and fast rule that can be applied to ascertain whether or
not the principle of abuse of rights is to be invoked. The
resolution of the issue depends on the circumstances of each
case.
DIVISION
[ GR No. 160689, Mar 26, 2014 ]
RAUL H. SESBREÑO v. CA
DECISION
BERSAMIN, J.:
This case concerns the claim for damages of petitioner
Raul H. Sesbreño founded on abuse of rights. Sesbreño accused
the violation of contract (VOC) inspection team dispatched by
the Visayan Electric Company (VECO) to check his electric
meter with conducting an unreasonable search in his residential
premises. But the Regional Trial Court (RTC), Branch 13, in Cebu
City rendered judgment on August 19, 1994 dismissing the
claim;[1] and the Court of Appeals (CA) affirmed the dismissal
on March 10, 2003.[2]
Hence, this appeal by Sesbreño.
Antecedents
At the time material to the petition, VECO was a public
utility corporation organized and existing under the laws of the
Philippines. VECO engaged in the sale and distribution of
electricity within Metropolitan Cebu. Sesbreño was one of
VECO's customers under the metered service contract they had
entered into on March 2, 1982.[3] Respondent Vicente E. Garcia
was VECO's President, General Manager and Chairman of its
Board of Directors. Respondent Jose E. Garcia was VECO's Vice-
President, Treasurer and a Member of its Board of Directors.
Respondent Angelita Lhuillier was another Member of VECO's
Board of Directors. Respondent Juan Coromina was VECO's
Assistant Treasurer, while respondent Norberto Abellana was the
Head of VECO's Billing Section whose main function was to
compute back billings of customers found to have violated their
contracts.
To ensure that its electric meters were properly
functioning, and that none of it meters had been tampered
with, VECO employed respondents Engr. Felipe Constantino
and Ronald Arcilla as violation of contract (VOC) inspectors.[4]
Respondent Sgt. Demetrio Balicha, who belonged to the 341st
Constabulary Company, Cebu Metropolitan Command, Camp
Sotero Cabahug, Cebu City, accompanied and escorted the
VOC inspectors during their inspection of the households of its
customers on May 11, 1989 pursuant to a mission order issued to
him.[5]
The CA summarized the antecedent facts as follows:
x x x. Reduced to its essentials, however, the facts of this
case are actually simple enough, although the voluminous
records might indicate otherwise. It all has to do with an
incident that occurred at around 4:00 o'clock in the afternoon
of May 11, 1989. On that day, the Violation of Contracts (VOC)
Team of defendants-appellees Constantino and Arcilla and
their PC escort, Balicha, conducted a routine inspection of the Judgment of the RTC
houses at La Paloma Village, Labangon, Cebu City, including
that of plaintiff-appellant Sesbreño, for illegal connections,
meter tampering, seals, conduit pipes, jumpers, wiring
On August 19, 1994, the RTC rendered judgment
connections, and meter installations. After Bebe Baledio,
dismissing the complaint.[7] It did not accord credence to the
plaintiff-appellant Sesbreño's maid, unlocked the gate, they
testimonies of Sesbreño's witnesses, Bebe Baledio, his
inspected the electric meter and found that it had been turned
housemaid, and Roberto Lopez, a part-time salesman, due to
upside down. Defendant-appellant Arcilla took photographs of
inconsistencies on material points in their respective testimonies.
the upturned electric meter. With Chuchie Garcia, Peter
It observed that Baledio could not make up her mind as to
Sesbreño and one of the maids present, they removed said
whether Sesbreño's children were in the house when the VOC
meter and replaced it with a new one. At that time, plaintiff-
inspection team detached and replaced the electric meter.
appellant Sesbreño was in his office and no one called to
Likewise, it considered unbelievable that Lopez should hear the
inform him of the inspection. The VOC Team then asked for and
exchanges between Constantino, Arcilla and Balicha, on one
received Chuchie Garcia's permission to enter the house itself to
hand, and Baledio, on the other, considering that Lopez could
examine the kind and number of appliances and light fixtures in
not even hear the conversation between two persons six feet
the household and determine its electrical load. Afterwards,
away from where he was seated during the simulation done in
Chuchie Garcia signed the Inspection Division Report, which
court, the same distance he supposedly had from the gate of
showed the condition of the electric meter on May 11, 1989
Sesbreño's house during the incident. It pointed out that Lopez's
when the VOC Team inspected it, with notice that it would be
presence at the gate during the incident was even
subjected to a laboratory test. She also signed a Load Survey
contradicted by his own testimony indicating that an elderly
Sheet that showed the electrical load of plaintiff-appellant
woman had opened the gate for the VECO personnel,
Sesbreño.
because it was Baledio, a lady in her 20s, who had repeatedly
stated on her direct and cross examinations that she had let the
VECO personnel in. It concluded that for Lopez to do nothing at
But according to plaintiff-appellant Sesbreño there was all upon seeing a person being threatened by another in the
nothing routine or proper at all with what the VOC Team did on manner he described was simply contrary to human
May 11, 1989 in his house. Their entry to his house and the experience.
surrounding premises was effected without his permission and
over the objections of his maids. They threatened, forced or
coerced their way into his house. They unscrewed the electric
In contrast, the RTC believed the evidence of the
meter, turned it upside down and took photographs thereof.
respondents showing that the VOC inspection team had found
They then replaced it with a new electric meter. They searched
the electric meter in Sesbreño's residence turned upside down
the house and its rooms without his permission or a search
to prevent the accurate registering of the electricity
warrant. They forced a visitor to sign two documents, making
consumption of the household, causing them to detach and
her appear to be his representative or agent. Afterwards, he
replace the meter. It held as unbelievable that the team
found that some of his personal effects were missing, apparently
forcibly entered the house through threats and intimidation;
stolen by the VOC Team when they searched the house.[6]
that they themselves turned the electric meter upside down in
order to incriminate him for theft of electricity, because the fact
that the team and Sesbreño had not known each other before
then rendered it unlikely for the team to fabricate charges
against him; and that Sesbreño's non-presentation of Chuchie
Garcia left her allegation of her being forced to sign the two
documents by the team unsubstantiated.
Decision of the CA
Sesbreño appealed, but the CA affirmed the RTC on
March 10, 2003,[8] holding thusly:
x x x. plaintiff-appellant Sesbreño's account is simply too
implausible or far-fetched to be believed. For one thing, the
inspection on his household was just one of many others that
the VOC Team had conducted in that subdivision. Yet, none
but plaintiff-appellant Sesbreño complained of the alleged acts
of the VOC Team. Considering that there is no proof that they
also perpetrated the same illegal acts on other customers in the
guise of conducting a Violation of Contracts inspection,
plaintiff-appellant Sesbreño likewise failed to show why he
alone was singled out. It is also difficult to believe that the VOC
Team would be brazen enough to want to antagonize a person
such as plaintiff-appellant Sesbreño. There is no evidence that
the VOC Team harbored any evil motive or grudge against
plaintiff-appellant Sesbreño, who is a total stranger to them.
Until he came along, they did not have any prior criminal
records to speak of, or at least, no evidence thereof was
presented. It is equally difficult to believe that their superiors
would authorize or condone their alleged illegal acts. Especially
so since there is no indication that prior to the incident on May
11, 1989, there was already bad blood or animosity between
plaintiff-appellant Sesbreño and defendant appellees to
warrant such a malevolent response. In fact, since availing of
defendant-appellee VECO's power services, the relationship
between them appears to have been uneventful.
It becomes all the more apparent that the charges
stemming from the May 11, 1989 incident were fabricated when
taken together with the lower court's evaluation of the alleged
theft of plaintiff-appellant Sesbreño's personal effects. It stated
that on August 8, 1989, plaintiff-appellant Sesbreño wrote the
barangay captain of Punta Princesa and accused Chuchie
Garcia and Victoria Villarta alias Victoria Rocamora of theft of
some of his things that earlier he claimed had been stolen by
members of the VOC Team. When he was confronted with
these facts, plaintiff-appellant Sesbreño further claimed that the
items allegedly stolen by Chuchie Garcia were part of the loot
taken by defendants-appellees Constantino and Arcilla. Yet not
once did plaintiff-appellant Sesbreño or any of his witnesses
mention that a conspiracy existed between these people.
Clearly, much like his other allegations, it is nothing more than
an afterthought by plaintiff-appellant Sesbreño.
All in all, the allegations against defendants-appellees
appear to be nothing more than a put-on to save face. For the
simple truth is that the inspection exposed plaintiff-appellant
Sesbreño as a likely cheat and thief.
xxxx
Neither is this Court swayed by the testimonies of Baledio
and Lopez. The lower court rightly described their testimonies as
fraught by discrepancies and inconsistencies on material points
and even called Lopez a perjured witness. On the other hand, it
is odd that plaintiff-appellant Sesbreño chose not to present the
witness whose testimony was very crucial. But even though
Chuchie Garcia never testified, her absence speaks volumes.
Whereas plaintiff-appellant Sesbreño claimed that the VOC
Team forced her to sign two documents that made her appear
to be his authorized agent or representative, the latter claimed
otherwise and that she also gave them permission to enter and
search the house. The person most qualified to refute the VOC
Team's claim is Chuchie Garcia herself. It is axiomatic that he
who asserts a fact or claim must prove it. He cannot transfer
that burden to the person against whom he asserts such fact or
claim. When certain evidence is suppressed, the presumption is
that it will adversely affect the cause of the party suppressing it,
should it come to light. x x x[9]
Upon denial of his motion for reconsideration,[10]
Sesbreño appealed.
Issue
Was Sesbreño entitled to recover damages for abuse of
rights?
Ruling
The appeal has no merit.
Sesbreño's main contention is that the inspection of his
residence by the VOC team was an unreasonable search for
being carried out without a warrant and for being allegedly
done with malice or bad faith.
Before dealing with the contention, we have to note that
two distinct portions of Sesbreño's residence were inspected by
the VOS team the garage where the electric meter was
installed, and the main premises where the four bedrooms, living
rooms, dining room and kitchen were located.
Anent the inspection of the garage where the meter was
installed, the respondents assert that the VOC team had the
continuing authority from Sesbreño as the consumer to enter his
premises at all reasonable hours to conduct an inspection of
the meter without being liable for trespass to dwelling. The
authority emanated from paragraph 9 of the metered service
contract entered into between VECO and each of its
consumers, which provided as follows:
9. The CONSUMER agrees to allow properly authorized
employees or representatives of the COMPANY to enter his
premises at all reasonable hours without being liable to trespass
to dwelling for the purpose of inspecting, installing, reading,
removing, testing, replacing or otherwise disposing of its
property, and/or removing the COMPANY'S property in the
event of the termination of the contract for any cause.[11]
Sesbreño contends, however, that paragraph 9 did not
give Constantino, Arcilla and Balicha the blanket authority to
enter at will because the only property VECO owned in his
premises was the meter; hence, Constantino and Arcilla should
enter only the garage. He denies that they had the right to
enter the main portion of the house and inspect the various
rooms and the appliances therein because those were not the
properties of VECO. He posits that Balicha, who was not an
employee of VECO, had no authority whatsoever to enter his
house and conduct a search. He concludes that their search
was unreasonable, and entitled him to damages in light of their
admission that they had entered and inspected his premises
without a search warrant.[12]

We do not accept Sesbreño's conclusion. Paragraph 9
clothed the entire VOC team with unquestioned authority to
enter the garage to inspect the meter. The members of the
team obviously met the conditions imposed by paragraph 9 for
an authorized entry. Firstly, their entry had the objective of
conducting the routine inspection of the meter.[13] Secondly,
the entry and inspection were confined to the garage where
the meter was installed.[14] Thirdly, the entry was effected at
around 4 o'clock p.m., a reasonable hour.[15] And, fourthly, the
persons who inspected the meter were duly authorized for the
purpose by VECO.
Although Balicha was not himself an employee of
VECO,[16] his participation was to render police assistance to
ensure the personal security of Constantino and Arcilla during
the inspection, rendering him a necessary part of the team as
an authorized representative. Under the circumstances, he was
authorized to enter considering that paragraph 9 expressly
extended such authority to "properly authorized employees or
representatives" of VECO.
It is true, as Sesbreño urges, that paragraph 9 did not
cover the entry into the main premises of the residence. Did this
necessarily mean that any entry by the VOS team into the main
premises required a search warrant to be first secured?
Sesbreño insists so, citing Section 2, Article III of the 1987
Constitution, the clause guaranteeing the right of every
individual against unreasonable searches and seizures, viz:
Section 2. The right of the people to be secure in their
persons, houses, papers and effects against unreasonable
searches and seizures of whatever nature and for any purpose
shall be inviolable, and no search warrant or warrant of arrest
shall issue except upon probable cause to be determined
personally by the judge after examination under oath or
affirmation of the complainant and the witnesses he may
produce, and particularly describing the place to be searched
and the persons or things to be seized.
He states that a violation of this constitutional guaranty
rendered VECO and its VOS team liable to him for damages by
virtue of Article 32 (9) of the Civil Code, which pertinently
provides:
Article 32. Any public officer or employee, or any private
individual, who directly or indirectly obstructs, defeats, violates
or in any manner impedes or impairs any of the following rights
and liberties of another person shall be liable to the latter for
damages:
xxxx
(9) The right to be secured in one's person, house,
papers, and effects against unreasonable searches and
seizures;
x x x x.
Sesbreño's insistence has no legal and factual basis.
 The constitutional guaranty against unlawful searches
and seizures is intended as a restraint against the Government
and its agents tasked with law enforcement. It is to be invoked
only to ensure freedom from arbitrary and unreasonable
exercise of State power. The Court has made this clear in its
pronouncements, including that made in People v. Marti,[17]
viz:
If the search is made upon the request of law enforcers,
a warrant must generally be first secured if it is to pass the test of
constitutionality. However, if the search is made at the behest or
initiative of the proprietor of a private establishment for its own
and private purposes, as in the case at bar, and without the
intervention of police authorities, the right against unreasonable
search and seizure cannot be invoked for only the act of
private individual, not the law enforcers, is involved. In sum, the
protection against unreasonable searches and seizures cannot
be extended to acts committed by private individuals so as to
bring it within the ambit of alleged unlawful intrusion by the
government.[18]
It is worth noting that the VOC inspectors decided to
enter the main premises only after finding the meter of Sesbreño
turned upside down, hanging and its disc not rotating. Their
doing so would enable them to determine the unbilled
electricity consumed by his household. The circumstances
justified their decision, and their inspection of the main premises
was a continuation of the authorized entry. There was no
question then that their ability to determine the unbilled
electricity called for them to see for themselves the usage of
electricity inside. Not being agents of the State, they did not
have to first obtain a search warrant to do so.
Balicha's presence participation in the entry did not
make the inspection a search by an agent of the State within
the ambit of the guaranty. As already mentioned, Balicha was
part of the team by virtue of his mission order authorizing him to
assist and escort the team during its routine inspection.[19]
Consequently, the entry into the main premises of the house by
the VOC team did not constitute a violation of the guaranty.
Our holding could be different had Sesbreño persuasively
demonstrated the intervention of malice or bad faith on the
part of Constantino and Arcilla during their inspection of the
main premises, or any excessiveness committed by them in the
course of the inspection. But Sesbreño did not. On the other
hand, the CA correctly observed that the inspection did not
zero in on Sesbreño's residence because the other houses within
the area were similarly subjected to the routine inspection.[20]
This, we think, eliminated any notion of malice or bad faith.
Clearly, Sesbreño did not establish his claim for damages
if the respondents were not guilty of abuse of rights. To stress,
the concept of abuse of rights prescribes that a person should
not use his right unjustly or in bad faith; otherwise, he may be
liable to another who suffers injury. The rationale for the
concept is to present some basic principles to be followed for
the rightful relationship between human beings and the stability
of social order.[21] Moreover, according to a commentator,
[22] "the exercise of right ends when the right disappears, and it
disappears when it is abused, especially to the prejudice of
others[;] [i]t cannot be said that a person exercises a right when
he unnecessarily prejudices another." Article 19 of the Civil
Code[23] sets the standards to be observed in the exercise of
one's rights and in the performance of one's duties, namely: (a)
to act with justice; (b) to give everyone his due; and (c) to
observe honesty and good faith. The law thereby recognizes
the primordial limitation on all rights that in the exercise of the
rights, the standards under Article 19 must be observed.[24]
 Although the act is not illegal, liability for damages may
arise should there be an abuse of rights, like when the act is
performed without prudence or in bad faith. In order that
liability may attach under the concept of abuse of rights, the
following elements must be present, to wit: (a) the existence of
a legal right or duty, (b) which is exercised in bad faith, and (c)
for the sole intent of prejudicing or injuring another.[25] There is
no hard and fast rule that can be applied to ascertain whether
or not the principle of abuse of rights is to be invoked. The
resolution of the issue depends on the circumstances of each
case.
Sesbreño asserts that he did not authorize Baledio or
Chuchie Garcia to let anyone enter his residence in his
absence; and that Baledio herself confirmed that the members
of the VOC team had intimidated her into letting them in.
The assertion of Sesbreño is improper for consideration in
this appeal. The RTC and the CA unanimously found the
testimonies of Sesbreño's witnesses implausible because of
inconsistencies on material points; and even declared that the
non-presentation of Garcia as a witness was odd if not suspect.
Considering that such findings related to the credibility of the
witnesses and their testimonies, the Court cannot review and
undo them now because it is not a trier of facts, and is not also
tasked to analyze or weigh evidence all over again.[26] Verily, a
review that may tend to supplant the findings of the trial court
that had the first-hand opportunity to observe the demeanor of
the witnesses themselves should be undertaken by the Court
with prudent hesitation. Only when Sesbreño could make a
clear showing of abuse in their appreciation of the evidence
and records by the trial and the appellate courts should the
Court do the unusual review of the factual findings of the trial
and appellate courts.[27] Alas, that showing was not made
here.
Nor should the Court hold that Sesbreño was denied due
process by the refusal of the trial judge to inhibit from the case.
Although the trial judge had issued an order for his voluntary
inhibition, he still rendered the judgment in the end in
compliance with the instruction of the Executive Judge, whose
exercise of her administrative authority on the matter of the
inhibition should be respected.[28] In this connection, we find to
be apt the following observation of the CA, to wit:
x x x. Both Judge Paredes and Judge Priscila Agana
serve the Regional Trial Court and are therefore of co-equal
rank. The latter has no authority to reverse or modify the orders
of Judge Paredes. But in ordering Judge Paredes to continue
hearing the case, Judge Agana did not violate their co-equal
status or unilaterally increased her jurisdiction. It is merely part of
her administrative responsibilities as Executive Judge of the
Regional Trial Court of Cebu City, of which Judge Paredes is
also a member.[29]
Lastly, the Court finds nothing wrong if the writer of the
decision in the CA refused to inhibit from participating in the
resolution of the motion for reconsideration filed by Sesbreño.
The motion for her inhibition was grounded on suspicion of her
bias and prejudice,[30] but suspicion of bias and prejudice were
not enough grounds for inhibition.[31] Suffice it to say that the
records are bereft of any indication that even suggested that
the Associate Justices of the CA who participated in the
promulgation of the decision were tainted with bias against him.
WHEREFORE, the Court DENIES the petition for review on
certiorari; AFFIRMS the decision promulgated on March 10, 2003;
and DIRECTS the petitioner to pay the costs of suit.
SO ORDERED.

Sereno, C.J., Leonardo-De Castro, Villarama, Jr, and
*Perez, JJ., concur,
Garcia vs. Salvador Mar. 20, 2007 J. Ynares-Santiago P:
ORLANDO D. GARCIA, JR., doing business under the name and
style COMMUNITY DIAGNOSTIC CENTER and BU CASTRO R:
RANIDA D. SALVADOR and RAMON SALVADOR
Facts: Ranida D. Salvador started working as a trainee in the
Accounting Department of Limay Bulk Handling Terminal, Inc. As
a prerequisite for regular employment, she underwent a
medical examination at the Community Diagnostic Center
(CDC). Garcia who is a medical technologist, conducted the
HBs Ag (Hepatitis B Surface Antigen) test and on October 22,
1993, CDC issued the test result5 indicating that Ranida was "HBs
Ag: Reactive." The result bore the name and signature of Garcia
as examiner and the rubber stamp signature of Castro as
pathologist. When Ranida submitted the test result to Dr. Sto.
Domingo, the Company physician, the latter apprised her that
the findings indicated that she is suffering from Hepatitis B, a liver
disease. Thus, based on the medical report6 submitted by Sto.
Domingo, the Company terminated Ranidaʼs employment for
failing the physical examination. When Ranida informed her
father, Ramon, about her ailment, the latter suffered a heart
attack and was confined at the Bataan Doctors Hospital. During
Ramonʼs confinement, Ranida underwent another HBs Ag test
at the said hospital and the result8 indicated that she is
nonreactive. She informed Sto. Domingo of this development
but was told that the test conducted by CDC was more reliable
because it used the Micro-Elisa Method. Ranida went back to
CDC for confirmatory testing, and this time, the Anti-HBs test
conducted on her indicated a "Negative" result. Ranida also
underwent another HBs Ag test at the Bataan Doctors Hospital
using the MicroElisa Method. Result: non-reactive Ranida
submitted the test results from Bataan Doctors Hospital and
CDC to the Executive Officer of the Company who requested
her to undergo another similar test before her reemployment
would be considered. Thus, CDC conducted another HBs Ag
test on Ranida which indicated a "Negative" result.11 Ma. Ruby
G. Calderon, Med-Tech Officer-in-Charge of CDC, issued a
Certification correcting the initial result and explaining that the
examining medical technologist (Garcia) interpreted the
delayed reaction as positive or reactive. Company rehired
Ranida July 25, 1994 - Ranida and Ramon filed a complaint13
for damages against petitioner Garcia and a purportedly
unknown pathologist of CDC, claiming that, by reason of the
erroneous interpretation of the results of Ranidaʼs examination,
she lost her job and suffered serious mental anxiety, trauma and
sleepless nights, while Ramon was hospitalized and lost business
opportunities. Castro was named as the pathologist Garcia
denied the allegations of gross negligence and incompetence
and reiterated the scientific explanation for the "false positive"
result of the first HBs Ag test in his December 7, 1993 letter to the
respondents Castro claimed that as pathologist, he rarely went
to CDC and only when a case was referred to him; that he did
not examine Ranida; and that the test results bore only his
rubber-stamp signature. TC dismissed complaint – respondents
should have presented Sto. Domingo and medical expert to
testify on the explanation given by Garcia CA reversed TC
decision Garcia maintains he is not negligent, thus not liable for injured thereby. Violations of RA 4688 (The Clinical Laboratory
damages, because he followed the appropriate laboratory Law) committed by CDC: 1)CDC is not administered, directed
measures and procedures as dictated by his training and and supervised by a licensed physician as required by law, but
experience; and that he did everything within his professional by Ma. Ruby C. Calderon, a licensed Medical Technologist.
competence to arrive at an objective, impartial and impersonal Castro was named as head of CDC, but his infrequent visits to
result. the clinical laboratory barely qualifies as an effective
administrative supervision and control over the activities in the
laboratory. 2) Garcia conducted the HBsAG test of respondent
Issue: WON CDC is liable Ranida without the supervision of Castro, who admitted that he
does not know and has never met her. 3) Disputed HBsAG test
result was released to respondent Ranida without the
authorization of Castro. Garcia may not have intended to
Held: Yes, CDC is liable. Negligence is the failure to observe for
cause the consequences which followed after the release of
the protection of the interest of another person that degree of
the HBsAG test result. However, his failure to comply with the
care, precaution and vigilance which the circumstances justly
laws and rules promulgated and issued for the protection of
demand,20 whereby such other person suffers injury. For health
public safety and interest is failure to observe that care which a
care providers, the test of the existence of negligence is: did the
reasonably prudent health care provider would observe. Thus,
health care provider either fail to do something which a
his act or omission constitutes a breach of duty. Injury:
reasonably prudent health care provider would have done, or
Indubitably, Ranida suffered injury as a direct consequence of
that he or she did something that a reasonably prudent health
Garciaʼs failure to comply with the mandate of the laws and
care provider would not have done; and that failure or action
rules aforequoted. She was terminated from the service for
caused injury to the patient;21 if yes, then he is guilty of
failing the physical examination; suffered anxiety because of
negligence. Elements of an actionable conduct: 1) Duty 2)
the diagnosis; and was compelled to undergo several more
Breach 3) Injury 4) Proximate causation Duty: Owners and
tests. All these could have been avoided had the proper
operators of clinical laboratories have the duty to comply with
safeguards been scrupulously followed in conducting the
statutes, as well as rules and regulations, purposely promulgated
clinical examination and releasing the clinical report. Art. 20
to protect and promote the health of the people by preventing
provides legal basis for the award of damages to a party who
the operation of substandard, improperly managed and
suffers damage whenever one commits an act in violation of
inadequately supported clinical laboratories and by improving
some legal provision. Art. 20: Every person who, contrary to law,
the quality of performance of clinical laboratory
willfully or negligently causes damage to another, shall
examinationsTheir business is impressed with public interest, as
indemnify the latter for the same. Orlando Garcia guilty of gross
such, high standards of performance are expected from them.
negligence.
Violation of a statutory duty is negligence. Where the law
imposes upon a person the duty to do something, his omission or
non-performance will render him liable to whoever may be
COMSAVINGS BANK (NOW GSIS FAMILY BANK) vs. SPS. DANILO
& ESTRELLA CAPISTRANO
G.R. No. 170942 August 28, 2013
FACTS:
Respondents were the owners of a residential lot in
Bacoor, Cavite. Desirous of building their own house on the lot,
they availed themselves of the UHLP implemented by the
National Home Mortgage Finance Corporation (NHMFC). On
May 28, 1992, they executed a construction contract with
Carmencita Cruz-Bay, the proprietor of GCB Builders, for the
total contract price of P265,000.00 with the latter undertaking to
complete the construction within 75 days. To finance the
construction, GCB Builders facilitated their loan application with
Comsavings Bank, an NHFMC-accredited originator. On May
28, 1992, they executed in favor of GCB Builders a deed of
assignment of the amount of the P300,000.00 proceeds of the
loan from Comsavings Bank.
On July 2, 1992, Comsavings Bank informed respondent
Estrella Capistrano that she would have to sign various
documents as part of the requirements for the release of the
loan. Among the documents was a certificate of house
completion and acceptance. On the same date, Comsavings
Bank handed Estrella a letter addressed to GCB Builders
informing the latter that respondents had complied with the
preliminary requirements of the UHLP, and were qualified to
avail themselves of the loan amounting to P303,450.00 payable
within 25 years at 16% per annum, subject to the following terms
and conditions, namely: the signing of mortgage documents,
100% completion of the construction of the housing unit, original
certificate of occupancy permit and certification of
completion, and submission of house pictures signed by the
borrower at the back.
On August 10, 1992, Comsavings Bank informed
respondents of the approval of an interim financing loan of
P260,000.00 payable within 180 days, which amount was to be
paid out of the proceeds of the loan from NHMFC.
In late September 1992, after Comsavings Bank had
released the total of P265,000.00 to GCB Builders as construction
cost, respondents inquired from GCB Builder when their house
would be completed considering that their contract stipulated
a completion period of 75 days. Cruz-Bay gave various excuses
for the delay, such as the rainy season, but promised to finish
the construction as soon as possible. The year 1992 ended with
the construction of the house unfinished. In February 1993,
respondents demanded the completion of the house. In reply,
Cruz-Bay told them to give the further amount of P25,000.00 to
finish the construction. They requested a breakdown of the
amounts already spent in the construction considering that
the P303,450.00 that Comsavings Bank had been paid by
NHMFC on their loan had been more than the contract price of
the contract. Instead of furnishing them the requested
breakdown, GCB Builders’ counsel sent a demand letter for an
additional construction cost of P52,511.59.
On May 30, 1993, respondents received a letter from NHMFC
advising that they should already start paying their monthly
amortizations of P4,278.00 because their loan had been
released on April 20, 1993 directly to Comsavings Bank. On June
1, 1993, Estrella Capistrano went to the construction site and
found to her dismay that the house was still unfinished.
On July 5, 1993, respondents wrote to NHMFC protesting
the demand for amortization payments considering that they
had not signed any certification of completion and
acceptance, and that even if there was such a certification of
completion and acceptance, it would have been forged.
On July 12, 1993, respondents sued GCB Builders and
Comsavings Bank for breach of contract and damages, praying
that defendants be ordered jointly and severally liable.
Respondents amended their complaint to implead NHMFC as
an additional defendant. Aside from adopting the reliefs under
the original complaint, they prayed that NHMFC be directed to
hold in abeyance its demand for amortization payment until the
case had been finally adjudged; that NHMFC, GCB Builders and
Comsavings Bank be ordered to pay moral and exemplary
damages, and attorney’s fees; and that GCB Builders and
Comsavings be directed to pay P4,500.00 as monthly rental
from the filing of the complaint until the house was turned-over
and accepted by them.
ISSUE:
Whether or not the defendants are jointly and severally liable for
damages.
HELD:
Yes.
Comsaving Bank’s liability was not based on its purchase
of loan agreement with NHMFC but on Article 20 and Article
1170 of the Civil Code. The CA rightfully declared Comsavings
Bank solidarily liable with GCB Builders for the damages
sustained by respondents. However, we point out that such
liability did not arise from Comsavings Bank’s breach of
warranties under its purchase of loan agreement with NHMFC.
Instead, the liability of Comsavings Bank towards respondents
was based on Article 20 and Article 1170 of the Civil Code, viz:
Article 20. Every person who, contrary to law,
willfully or negligently causes damage to another shall
indemnify the latter for the same.
Article 1170. Those who in the performance of their
obligations are guilty of fraud, negligence, or delay, and
those who in any manner contravene the tenor thereof,
are liable for damages.
Based on the provisions, a banking institution like
Comsavings Bank is obliged to exercise the highest degree of
diligence as well as high standards of integrity and performance
in all its transactions because its business is imbued with public
interest. As aptly declared in Philippine National Bank v.
Pike: "The stability of banks largely depends on the confidence
of the people in the honesty and efficiency of banks."
Gross negligence connotes want of care in the
performance of one’s duties; it is a negligence characterized by
the want of even slight care, acting or omitting to act in a
situation where there is duty to act, not inadvertently but willfully
and intentionally, with a conscious indifference to
consequences insofar as other persons may be affected. It
evinces a thoughtless disregard of consequences without
exerting any effort to avoid them.
There is no question that Comsavings Bank was grossly
negligent in its dealings with respondents because it did not
comply with its legal obligation to exercise the required
diligence and integrity. As a banking institution serving as an
originator under the UHLP and being the maker of the
certificate of acceptance/completion, it was fully aware that
the purpose of the signed certificate was to affirm that the
house had been completely constructed according to the
approved plans and specifications, and that respondents had
thereby accepted the delivery of the complete house. Given
the purpose of the certificate, it should have desisted from
presenting the certificate to respondents for their signature
without such conditions having been fulfilled. Yet, it made
respondents sign the certificate (through Estrella Capistrano,
both in her personal capacity and as the attorney-in-fact of her
husband Danilo Capistrano) despite the construction of the
house not yet even starting. Its act was irregular per se because
it contravened the purpose of the certificate.
On the other hand, respondents were prejudiced,
considering that the construction of the house was then still
incomplete and was ultimately defective. Compounding their
plight was that NHMFC demanded payment of their monthly
amortizations despite the non-completion of the house. Had
Comsavings Bank been fair towards them as its clients, it should
not have made them pre-sign the certificate until it had
confirmed that the construction of the house had been
completed.
 As to the damages that should be awarded to
respondents, moral and exemplary damages were warranted.
Under Article 2219 of the Civil Code, moral damages may be
recovered for the acts or actions referred to in Article 20 of the
Civil Code. Moral damages are meant to compensate the
claimant for any physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded feelings,
moral shock, social humiliation and similar injuries unjustly
caused.
The law allows the grant of exemplary damages to set an
example for the public good. The business of a bank is affected
with public interest; thus, it makes a sworn profession of
diligence and meticulousness in giving irreproachable service.
For this reason, the bank should guard against injury attributable
to negligence or bad faith on its part. The banking sector must
at all times maintain a high level of meticulousness. The grant of
exemplary damages is justified by the initial carelessness of
petitioner, aggravated by its lack of promptness in repairing its
error.
However, the award of actual damages amounting
to P25,000.00 is not warranted. To justify an award for actual
damages, there must be competent proof of the actual
amount of loss. Credence can be given only to claims duly
supported by receipts. Respondents did not submit any
documentary proof, like receipts, to support their claim for
actual damages. In lieu of actual damages, therefore,
temperate damages of P25,000.00 are awarded. Such amount,
in our view, is reasonable under the circumstances.
Article 2208 of the Civil Code allows recovery of
attorney’s fees when exemplary damages are awarded or
where the plaintiff has incurred expenses to protect his interest
by reason of defendant’s act or omission. Considering that
exemplary damages were properly awarded here, and that
respondents hired a private lawyer to litigate its cause, we
agree with the RTC and CA that the P30,000.00 allowed as
attorney’s fees were appropriate and reasonable.
Wassmer vs. Velez G.R. No. L-20089 (1964)
Facts: Francisco X. Velez and Beatriz P. Wassmer,
following their mutual promise of love, decided to get married
and set September 4, 1954 as the big day. On September 2,
1954 Velez left Wassmer with a note stating that the wedding
must be postponed, as Velez’s mother opposes it. He also asked
Wassmer not to fuss. The following day, however, Velez sent
Wassmer another telegram, stating that nothing has changed,
and he shall return very soon. Velez was never seen by Wassmer
nor heard from again after that. Wassmer filed a suit for
damages against Velez. Velez filed no answer and was
declared in default. Judgment was rendered in favor of
Wassmer, ordering Velez to pay P2,000.00 as actual damages;
P25,000.00 as moral and exemplary damages; P2,500.00 as
attorney's fees; and the costs of the suit. Velez filed a petition for
relief from orders, judgment and proceedings and motion for
new trial and reconsideration. Plaintiff moved to strike it out, but
the Court ordered the parties to explore at this stage of the
proceedings the possibility of arriving at an amicable
settlement. Following a series of failed attempts to amicably
settle the matter, the court issued an order denying defendant's
aforesaid petition. Hence, Velez’s appeal to the high Court. In
support of his "motion for new trial and reconsideration,"
defendant asserts that the judgment is contrary to law. The
reason given is that "there is no provision of the Civil Code
authorizing" an action for breach of promise to marry. As stated
in Hermosisima vs. Court of Appeals, “…a mere breach of a
promise to marry is not an actionable wrong.”
Issue: Should the lower court’s decision be set aside,
removing Wassmer’s right to claim damages?
Held: The lower court’s decision must be affirmed, as
what was done by the high Court in this case. The extent to
which acts not contrary to law may be perpetrated with
impunity, is not limitless for Article 21 of said Code provides that
"any person who willfully causes loss or injury to another in a
manner that is contrary to morals, good customs or public
policy shall compensate the latter for the damage." The record
reveals that Wassmer and Velez applied for a license to
contract marriage, set a wedding day for September 4, 1954,
Printed and distributed wedding invitations to relatives, friends
and acquaintances, purchased dresses and other apparel for
the important occasion and the like. And then, with but two
days before the wedding, Velez simply left. Surely this is not a
case of mere breach of promise to marry. As stated, mere
breach of promise to marry is not an actionable wrong. But to
formally set a wedding and go through all the above-described
preparation and publicity, only to walk out of it when the
matrimony is about to be solemnized, is quite different. This is
palpably and unjustifiably contrary to good customs for which
defendant must be held answerable in damages in
accordance with Article 21 aforesaid. Velez also contends that
the moral damages awarded were excessive, and should be
totally eliminated. This argument, however is devoid of merit.
Under the above-narrated circumstances of this case
defendant clearly acted in a "wanton, reckless and oppressive
manner." The high Court's opinion, however, is that considering
the particular circumstances of this case, P15,000.00 as moral
and exemplary damages is deemed to be a reasonable award.
TANJANCO vs. SANTOS G.R. No. L-18630 (1966)
Facts: Apolonio Tanjanco courted Araceli Santos, the former
expressing and professing his undying love and affection for her
who also, in due time reciprocated the tender feelings. In
consideration of Tanjanco’s promise to marry Santos, she
consented to Tanjanco’s pleas for carnal knowledge, as a result
of which Santos conceived a child. To avoid embarrassment
and social humiliation due to her pregnancy, Santos resigned
from her job in IBM, Philippines as a secretary, thereby unable to
support herself and her baby. Tanjanco, on the other hand,
refused to marry Santos, as well as recognize their unborn child,
prompting her to file suit to compel Tanjanco to recognize the
unborn child she was bearing, to give her support of not less
than P430.00 a month, plus P100,000.00 in moral and exemplary
damages and P10,000.00 attorney's fees. Tanjanco, in turn, filed
a motion to dismiss. The lower court dismissed the complaint for
failure to state a cause of action. On appeal, the CA held that
no cause of action was shown to compel recognition of a child
as yet unborn, nor for its support, but decreed that the
complaint did state a cause of action for damages, premised
on Article 21 of the Civil Code. It set aside the lower court’s
decision and directed the same to proceed with the case. This
prompted Tanjanco to appeal to the high Court.
Issue: Is Tanjanco correct in pleading that actions for breach of
a promise to marry are not permissible in this jurisdiction?
Held: The Court ruled in the affirmative. The Appellate court
erred by relying upon a memorandum submitted by the Code
Commission to the Legislature in 1949 to support the original
draft of the Civil Code, which provided this example: "A"
seduces the nineteen-year old daughter of "X". A promise of
marriage either has not been made, or cannot be proved. The
girl becomes pregnant. Under the present laws, there is no
crime, as the girl is above eighteen years of age. Neither can
any civil action for breach of promise of marriage be filed.
Therefore, though the grievous moral wrong has been
committed, and though the girl and her family have suffered
incalculable moral damage, she and her parents cannot bring
any action for damages. But under the proposed article (now
Article 21), she and her parents would have such a right of
action. Indeed, the CA overlooked the fact that the
memorandum referred to a tort upon a minor who has been
seduced, which connotes essentially the idea of deceit,
enticement, superior power or abuse of confidence on the part
of the seducer to which the woman has yielded. Given the
circumstances of this case, the facts stand out that for one
whole year, from 1958 to 1959, Santos, a woman of adult age,
maintained intimate sexual relations with Tanjanco with
repeated acts of intercourse. Such conduct is incompatible with
the idea of seduction. There is voluntariness and mutual passion
in this case, for had the she been deceived, had she
surrendered exclusively because of the deceit, artful
persuasions and wiles of the Tanjanco, she would not have
again yielded to his embraces, much less for one year, without
exacting early fulfillment of the alleged promises of marriage,
and would have cut all sexual relations upon finding that
defendant did not intend to fulfill his promises. Hence, we
conclude that no case is made under Article 21 of the Civil
Code, and no other cause of action being alleged, no error
was committed by the Court of First Instance in dismissing the
complaint. The dismissal, however, must be understood to be
without prejudice to whatever actions may correspond to the
child of Tanjanco. On that point, this Court makes no
pronouncement, since the child's own rights are not here
involved.
219 SCRA 115 – Civil Law – Torts and Damages – Breach of
promise to Marry – Article 21 of the Civil Code
In August 1986, while working as a waitress in Dagupan City,
Pangasinan, Marilou Gonzales, then 21 years old, met Gashem
Shookat Baksh, a 29 year old exchange student from Iran who
was studying medicine in Dagupan. The two got really close
and intimate. On Marilou’s account, she said that Gashem later
offered to marry her at the end of the semester. Marilou then
introduced Gashem to her parents where they expressed their
intention to get married. Marilou’s parents then started inviting
sponsors and relatives to the wedding. They even started
looking for animals to slaughter for the occasion.
Meanwhile, Marilou started living with Gashem in his apartment
where they had sexual intercourse. But in no time, their
relationship went sour as Gashem began maltreating Marilou.
Gashem eventually revoked his promise of marrying Marilou
and he told her that he is already married to someone in
Bacolod City. So Marilou went home and later sued Gashem for
damages.
The trial court ruled in favor of Marilou and awarded her P20k in
moral damages. The Court of Appeals affirmed the decision of
the trial court.
On appeal, Gashem averred that he never proposed marriage
to Marilou and that he cannot be adjudged to have violated
Filipino customs and traditions since he, being an Iranian, was
not familiar with Filipino customs and traditions.
ISSUE: Whether or not the Court of Appeals is correct.
HELD: Yes. Gashem is liable to pay for damages in favor of
Marilou not really because of his breach of promise to marry her
but based on Article 21 of the Civil Code which provides:
Any person who wilfully causes loss or injury to another in a
manner that is contrary to morals, good customs or public
policy shall compensate the latter for the damage.
Breach of promise to marry is not an actionable wrong per se. In
this case, it is the deceit and fraud employed by Gashem that
constitutes a violation of Article 21 of the Civil Code. His promise
of marrying Marilou was a deceitful scheme to lure her into
sexual congress. As found by the trial court, Marilou was not a
woman of loose morals. She was a virgin before she met
Gashem. She would not have surrendered herself to Gashem
had Gashem not promised to marry her. Gashem’s blatant
disregard of Filipino traditions on marriage and on the
reputation of Filipinas is contrary to morals, good customs, and
public policy. As a foreigner who is enjoying the hospitality of
our country and even taking advantage of the opportunity to
study here he is expected to respect our traditions. Any act
contrary will render him liable under Article 21 of the Civil Code.
The Supreme Court also elucidated that Article 21 was meant to
expand the concepts of torts and quasi delict. It is meant to
cover situations such as this case where the breach complained
of is not strictly covered by existing laws. It was meant as a legal
remedy for the untold number of moral wrongs which is
impossible for human foresight to specifically enumerate and
punish in the statute books – such as the absence of a law
penalizing a the breach of promise to marry.
The Supreme Court however agreed with legal luminaries that if
the promise to marry was made and there was carnal
knowledge because of it, then moral damages may be
recovered (presence of moral or criminal seduction), Except if
there was mutual lust; or if expenses were made because of the
promise (expenses for the wedding), then actual damages may
be recovered.
Pe vs. Pe G.R. No. L-17396 (1962)
Facts: The case originates from the parents, brothers and sisters
of one Lolita Pe, who had gone missing on April 14, 1957 and at
that time, was a single, 24 year old woman. Sometime in 1952,
Alfonso frequented the house of Lolita on the pretext that he
wanted her to teach him how to pray the rosary. The two
eventually fell in love with each other and conducted
clandestine trysts not only in the town of Gasan but also in Boac
where Lolita used to teach in a barrio school. Eventually, Lolita’s
parents found out and forbade Alfonso from going to their
house and from further seeing Lolita. Sometime in April, 1957,
Lolita was staying with her brothers and sisters at their residence
at 54-B España Extension, Quezon City. On April 14, 1957, Lolita
disappeared from said house. After she left, her brothers and
sisters checked her things and found that Lolita's clothes were
gone. However, plaintiffs found a note on a crumpled piece of
paper inside Lolita's aparador. The disappearance of Lolita was
reported to the police authorities and the NBI but up to the
present there is no news or trace of her whereabouts. This
prompted the filing of the current action with the CFI-Manila to
recover moral, compensatory, exemplary and corrective
damages in the amount of P94,000.00 exclusive of attorney's
fees and expenses of litigation. Defendant, after denying some
allegations contained in the complaint, set up as a defense that
the facts alleged therein, even if true, do not constitute a valid
cause of action. The lower court, finding that Alfonso had
carried on a love affair with Lolita Pe, being a married man
himself, declared that Alfonso cannot be held liable for moral
damages, it appearing that Lolita’s relatives failed to prove that
Alfonso deliberately and in bad faith tried to win Lolita's
affection. So it rendered a decision dismissing the complaint
Issue: May the parents and siblings of Lolita Pe recover
damages based on the fact that defendant, being a married
man, carried on a love affair with Lolita Pe thereby causing
them injury in a manner contrary to morals, good customs and
public policy? Held: The present action is based on Article 21 of
the New Civil Code. Conversely, the trial court considered the
complaint not actionable for the reason that they failed to
prove that Alfonso deliberately and in bad faith tried to win
Lolita's affection.
The high Court refused to align itself to this view. The
circumstances under which defendant tried to win Lolita's
affection cannot lead, to any other conclusion than that it was
he who seduced the latter to the extent of making her fall in
love with him, as shown by the fact that defendant frequented
the house of Lolita on the pretext that he wanted her to teach
him how to pray the rosary. Because of the frequency of his visits
to the latter's family who was allowed free access because he
was a collateral relative and was considered as a member of
her family, the two eventually fell in love with each other and
conducted clandestine love affairs not only in Gasan but also in
Boac. Indeed, no other conclusion can be drawn from this
chain of events than that Alfonso, through a clever strategy,
succeeded in winning the affection and love of Lolita to the
extent of having illicit relations with her. The wrong he has
caused her and her family is indeed immeasurable considering
the fact that he is a married man. Verily, he has committed an
injury to Lolita's family in a manner contrary to morals, good
customs and public policy as contemplated in Article 21 of the
new Civil Code.
Grand Union Supermarket, Inc. vs. Espino Gr No. L-48250
(December 28, 1979)
Facts: Jose J. Espino a civil engineer and an executive at
Proctor and Gamble was shopping at South Supermarket in
Makati on the morning of August 22, 1970. He had picked up a
“rat tail” file from one of the shelves, placed it in his shirt pocket,
with a good part of it exposed, and forgot to pay for it when he
got to the cashier. As he and his wife and daughters were
leaving the supermarket with their shopping bags, a security
guard of the store approached Espino and informed him that
he had an item in his pocket which he did not pay for. Espino
immediately apologised and started to walk towards the
cashier to pay for the item. He was then stopped by the guard
and asked to go to the back of the supermarket to write an
incident report as this was supposedly the procedure of the
establishment. Espino stated on the report that he put the item
in his pocket as he was talking with his helper while in the store
and that he merely forgot to present it to the cashier. Espino
was then lead into the Supermarket and the report was given to
Nelia Santos-Fandino who was seated at a desk beside the first
checkout counter. Nelia after reading the report remarked that
this was another case of theft, to which Espino explained that
he merely forgot the “”rat tail” in his pocket and that he had
the intention to pay for it. Neilia then replied to the effect that
that was the same thing all shoplifters say when they are
caught. This was done while people were lining up and paying
for the items they shopped. Espino was then made to pay a fine
of 5 pesos, which Nelia reasoned was a prize for the guard who
apprehended him. Espino then paid the fine and was made to
line up at the cashier to pay for the item. As he waited in line he
was stared at and people were talking about him. Extremely
humiliated by the incident he immediately left the premises
after paying. Espino filed a complaint on October 8, 1970
founded on article 21 in relation to article 2219 of the New Civil
Code and prayed for damages. The CFI of Pasig, Rizal dismissed
the complaint; but the Court of Appeals reversed such. Espino
was granted moral damages at P 75,000, exemplary damages
of P 25,000 Pesos, attorney’s fees at P 5,000 and the return of the
P 5 fine. Grand Union Supermarket now appeals said decision
citing that Espino was guilty of theft and that their action of
apprehending and fining him was merely an exercise of their
right to protect their property as enunciated in article 429 of the
New Civil Code. They also stated that there was probable
cause for his apprehension, that it was not done with malice or
bad faith and the proximate cause for such was Espino’s own
actions. They also argued that even if damages were in order,
the amounts awarded were unconscionable.
Issue: Whether the act of apprehending Espino in such a
manner would render the supermarket liable?
Held: Yes, such actions do render the supermarket liable. The
court believes Espino committed an honest mistake when he
forgot to pay for his item. This was proven by the fact that he
put it in his pocket while he was preoccupied and that he
apologised and immediately moved to pay for such at the
instance the guard alerted him. The fact that he was an
engineer, an executive of Proctor and Gamble, an esteemed
member of society and a regular customer of the supermarket
also belies motive to steal an item of an insignificant amount,
which he was more than capable of paying for. Further, he was
also in the company of his family, a deterrent from criminal
activity. of being a shoplifter in a manner contrary to morals,
good customs or public policy and thus may be awarded
damages. His being identified as a shoplifter in the incident
report, being called such by Nelia and being made to pay a
fine with a threat to call the police and report the incident if he
would not do so, truly caused him humiliation and
embarrassment. However, the amount of damages should be
modified. Espino’s forgetfulness was the proximate cause of the
incident, and such contributory negligence would work to
reduce the damages awarded, as enunciated in article 2214 of
the New Civil Code. The court also considers the fact that the
presence of shoppers in the premises was merely coincidental
as it is a public place and their presence was not actively
called for by the management in order to humiliate Espino. The
court also believes that the management’s policy to have
Espino brought to the back of the supermarket to make a report
and to present him to one of the officers was not intentionally
done to humiliate him because the supermarket’s business
success would be compromised if it was seen that their public
relations with customers were intentionally such. Moral damages
are reduced to P 5,000, exemplary damages are deleted,
attorney’s fees are reduced to P 2,000 and the P 5 fine must be
returned.
CARPIO v. VALMONTE G.R. No. 151866; September 9, 2004;
Tinga, J.
FACTS: Respondent Valmonte is a wedding coordinator.
Michelle del Rosario and Jon Sierra engaged her services for
their church wedding. On that day, Valmonte went to the
Manila Hotel to where the bride and her family were billeted.
When she arrived at the Suite, several persons were already
there including the petitioner Soledad Carpio, an aunt of the
bride who was preparing to dress up for the occasion. After
reporting to the bride, Valmonte went out of the suite carrying
the items needed for the wedding rites and the gifts from the
principal sponsors. She proceeded to the Maynila Restaurant
where the reception was to be held. She went back to the suite
after, and found several people staring at her when she
entered. . It was at this juncture that petitioner allegedly uttered
the following words to Valmonte: “Ikaw lang ang lumabas ng
kwarto, nasaan ang dala mong bag? Saan ka pumunta? Ikaw
lang and lumabas ng kwarto, ikaw ang kumuha.” Petitioner
then ordered one of the ladies to search Valmonte’s bag. It
turned out that after Valmonte left the room to attend to her
duties, petitioner discovered that the pieces of jewelry which
she placed inside the comfort room in a paper bag were lost. A
few days after the incident, petitioner received a letter from
Valmonte demanding a formal letter of apology which she
wanted to be circulated to the newlyweds ’relatives and guests
to redeem her smeared reputation as a result of petitioner’s
imputations against her. Petitioner did not respond to the letter.
Thus, on 20February 1997, Valmonte filed a suit for damages
against petitioner.
ISSUE: W/N respondent Valmonte is entitled to damages
RULING: Valmonte is entitled to damages. In the case at bar,
petitioner’s verbal reproach against respondent was certainly
uncalled for considering that by her own account nobody knew
that she brought such kind and amount of jewelry inside the
paper bag. True, petitioner had the right o ascertain the identity
of the malefactor, but to malign respondent without an iota of
proof that she was the one who actually stole the jewelry is an
act which, by any standard or principle of law is impermissible.
Petitioner had willfully caused injury to respondent in a manner
which is contrary to morals and good customs. She did not act
with justice and good faith for apparently, she had no other
purpose in mind but to prejudice respondent. Certainly,
petitioner transgressed the provisions of Article 19 in relation to
Article 21 for which she should be held accountable.
Que vs. IAC G.R. No. L-66865 (1989)
Facts: The origin of this dispute goes back to when Que and
Nicolas were still in amicable terms. In July and August of 1975,
Nicolas ordered from Que certain amounts of canvass strollers
which were delivered to and accepted by Nicolas, who issued
five checks therefore to Que worth P7,600. Nicolas, however,
ordered the bank to stop payment because of defects in the
articles sold which Que had not corrected. Que for his part
argued that the allegedly defective articles were never
returned to him until after he had filed the charge for estafa
and that Nicolas had earlier merely ignored his complaints
about the dishonored checks. Que filed a complaint for estafa
against Nicolas in the office of the city fiscal of Caloocan City
for the issuance of several dishonored checks upon
presentment. The charge was dismissed for lack of merit, the
investigating fiscal holding that the controversy was an
accounting matter that did not necessarily involve deceit on
the part of Nicolas. Subsequently, Nicolas filed his own
complaint for damages against Que with the CFI-Bulacan, for
what he claimed was his malicious prosecution by the latter.
Que now claims harassment. In his counterclaim, he averred
that Nicolas had maliciously filed the complaint in Bulacan
although he was a resident of Caloocan City; that the private
respondent was really indebted to him in any case and that it
was he who had suffered damages as a result of the
unwarranted suit. Originally, the lower court held in favor of
Antonio and awarded him the total amount of P80,500.00 in
moral, exemplary, and nominal damages plus a P4,000.00
attorney's fee and the costs of the suit, finding was that Que
had acted maliciously in filing the estafa charge and in alleging
that the plaintiff had issued the dishonored checks with deceit.
Que’s motion for reconsideration was denied. A second motion
for reconsideration was filed after a motion to stay the running
of the period of appeal was filed. This second motion found
merit, and reversed the original decision, awarding Que 10,000
as moral damages. On appeal, the IAC reinstating the original
decision of the trial court in favor of Nicolas. Issue: Had
Magtanggol Que instituted a malicious prosecution against
Antonio Nicolas? Held: The high Court ruled in the negative. It is
evident that Que was not motivated by ill feeling but by anxiety
to protect his rights when he filed the criminal complaint for
estafa with the fiscal's office. If he averred that the Antonio had
no funds in the bank when he issued the postdated checks and
intended to cheat him, it was because the circumstances of the
case as Que saw them led him to this conclusion. Even if the
fiscal found that no deceit was involved and that the
petitioner's claim was unfounded, the mistaken charge was
nonetheless, in the legal sense, not malicious. As previously held
in Manila Gas Corporation v. Court of Appeals, “To constitute
malicious prosecution, there must be proof that the prosecution
was prompted by a sinister design to vex and humiliate a person
that it was initiated deliberately by the defendant knowing that
his charges were false and groundless. Concededly, the mere
act of submitting a case to the authorities for prosecution does
not make one liable for malicious prosecution.” The criminal
complaint filed by the petitioner was not a mere ploy to enforce
the payment of his account by Nicolas. There was here a
genuine protest over the abrupt and suspicious order to stop
the encashment of the checks issued to him by the private
respondent. On the contrary, there is a stronger suggestion of
malice on the part of Nicolas when he filed his suit for damages
against Que in Bulacan, notwithstanding that the place of
business was in Caloocan. However, inasmuch as good faith is
presumed, and applying this presumption both to the petitioner
and the private respondent, we hereby rule that, absent
sufficient rebuttable evidence, neither of them is guilty of malice
in their mutual relations.
Magbanua v. Junsay
Feb 12, 2007
G.R. No. 132659
Digest By: Xavier A. Cortez
Malicious Prosecution; Words and Phrases; The term malicious
prosecution has been defined as “An action for damages
brought by one against whom a criminal prosecution, civil suit,
or other legal proceeding has been instituted maliciously and
without probably cause, after the termination of such
prosecution, suit, or other proceeding in favor of the defendant
therein.” The term, while ordinarily referring to criminal actions,
have been expanded into unfounded civil suits.
Same; the gravamen of malicious prosecution is not the filing of
a complain based on the wrong provisions of law, but the
deliberate initiation of an action with the knowledge that the
charges were false and groundless. The four elements are as
follows:
(1) The prosecution did occur, and the defendant was
himself the prosecutor or that he instigated its
commencement;
(2) The criminal action finally ended with an acquittal;
(3) In bringing the action, the prosecutor acted without
probable cause;
(4) The prosecution was impelled by legal malice – an
improper or sinister motive.
CHRONOLOGY OF THE CASE OF MALICIOUS PROSECUTION:
1.) RTC – Dismiss for lack of elements
2.) CA - Dismiss the appeal for lack of merit
3.) SC – Affirm in toto the decision of the CA
FACTS:
Rosemarie Magbanua is a domestic helper of herein
respondent, Pilar Junsay, who is a medical doctor. One fateful
day, a robbery occurred at the residence of herein respondent.
The robbery was consummated with the use of force on things –
there was a hole made on the lower left corner of the kitchen
door which enabled entry of the robbers. The robbery resulted
in the loss of P29, 800 worth of jewellery and other items. A case
was filed against Magbanua and two other accused alleging
that Magbanua conspired with the two individuals in order to
consummate the robbery. The two individuals were at large
while only Magbanua was submitted to the jurisdiction of the
court for prosecution.
In finding probable cause, the prosecutor submitted the case
for trial to the RTC. Probable cause was based on the testimony
of the complainants, the report of the police on the
investigation conducted, and the submitted voluntary
admission allegedly by Magbanua. The voluntary admission
stated that Magbanua accepted the jewellery as part of her
share, and that she did accede to the other two accused in
compromising the kitchen door so that they would have access
and break entry into the home.
In the trial, it was adjudged that the confession was taken under
duress because Magbanua was proven to be maltreated by
the police officers in efforts to extract a confession. Also, the
testimonies were not credible for being inconsistent with the
report of the police. The testimony states that in the bag of the
accused were found a gold necklace – the supposed share of
hers from the spoils of the robbery, but the police report failed
to state this. Surely, the police would have searched the papers
and effects of the accused in this case. Due to this
inconsistency, the RTC acquitted Magbanua for lack of
evidence and also stating that there was no prima facie case
of robbery here as against her.
Consequently, Magbanua filed a case for malicious
prosecution and damages against herein respondent, the same
individual who was the complainant in the case for robbery
against her. She alleged that she was maltreated by the
policemen in extracting a confession from her and this was the
sole reason why the prosecutor passed the case for submission
to the court. She alleged that she suffered pain, suffering,
humiliation, and furthermore, since she was a minor, her father
represented her in court. She also alleged that her father lost his
occupation due to the whole fiasco. She was claiming
damages as well from the respondent and the two policemen,
herein private respondent, who implemented the investigation
in a brazen manner. She further alleged that Junsay took
advantage of her status in society as a medical doctor and
used her influence in filing a case against Magbanua.
The evidence she submitted were medical certificates proving
her physical injuries, and the order of the PNP disciplinary arm,
the NAPOLCOM, suspending the two policemen for breaking
protocol and extracting a confession with the use of force,
intimidation, and violence on a minor, who, nonetheless is
uneducated, from the province, and was not provided any
guidance and support.
The defendants herein denied any liability. Junsay stated that
she said that she had no part in the investigation, while the
policemen stated that they submitted the case to the
prosecutor as part of their duty.
ISSUES:
1.) Whether or not there is a case of malicious prosecution;
and
 2.) Whether or not Magbanua is entitled to damages for
malicious prosecution; and
3.) Whether or not Magbanua is entitled to damages for
maltreatment and injuries.
HELD:
1.) NO – lack of elements for malicious prosecution
2.) NO – There can be no damages for malicious
prosecution if malicious prosecution does not exist.
3.) NO – Deemed not included in the case of malicious
prosecution filed by Magbanua.
RATIONIZATION:
There is no case for malicious prosecution here for lack of
elements. The first two elements of malicious prosecution in this
case are present in that the prosecution did occur and the
accused was acquitted. As to the presence of probable cause,
the court adjudicated that it did in fact exist, thus the third
elementis wanting. The fact that the prosecutor filed the
information in court is evidence of this. The issue as to whether
or not the confession is admissible is an evidentiary issue, and is
not considered in the preliminary investigation. The prosecutor
did not err in submitting the case for trial, thus there are no flaws
in his finding of probable cause with the evidence submitted to
him. It must be remembered that the determination of probable
cause is based on opinion and reasonable belief, and does not
require an inquiry into whether or not there was sufficient
evidence to procure a conviction.
The last element is also wanting. The gravamen of malicious
prosecution is the deliberate initiation of an action with the
knowledge that the charges were false and groundless. The
gravamen is not present here for failure to prove malice on the
part of both the policemen and Junsay. There was no evidence
offered to prove that there existed the any sinister motive.
First, Junsay did not allege that Magbanua is the perpetrator of
the crime. She merely reported the incident to the police.
Secondly, the police have the duty to conduct an investigation
and there is no impropriety to their response to the call of a
reported robbery. Lastly, when the police submitted the report
to the prosecutor, they also included two other accused – and
not merely Magbanua. Such submission for filing in court is also
the duty of policemen which they cannot be faulted for. The
filing of the case against three individuals is also indicative that
the prosecution was not focused merely on vexing or
humiliating Magbanua, but was filed as a legitimate case,
subsequent to the commission of the crime of robbery. One
cannot be faulted for legitimately submitting a case to the
court for adjudication.
There was also no evidence to prove that there was bad blood
between Magbanua and her employer, as well as between her
and the investigating policemen. There was no motive for any
of them to file maliciously the case of robbery against
Magbanua.
In sum, there is no malicious prosecution in this case because
there was a definitive finding of probable cause by the
prosecutor, as assisted by the investigation done by the
policemen, which was prompted by a legitimate report of
robbery by Junsay. There also exists no legal malice on the part
of the respondents in this case for lack of proof of any ill motive
or sinister design to humiliate and vex Magbanua.
Damages are also wanting because the RTC rules that the
damages sued for correspond to malicious prosecution, and
not the maltreatment which resulted in Magbanua’s injuries.
Also, even if it were being sued for, the right to file an action for
damages had prescribed, the case being filed 4 years and 8
months from the act. Pursuant to Article 1146 of the NCC,
actions for damages prescribe after 4 years.
WHEREFORE, the Appeal is denied, and the decision of the
Court of Appeals, AFFIRMED.
Quisaba v. Sta. Ines-Melale Veneer and Plywood
JOVITO QUISABA v. STA. INES-MELALE VENEER & PLYWOOD
[SIMVP]
1974 / Castro
FACTS
Quisaba was an internal auditor of SIMVP for 18 years. On
January 1973, SIMVP VP Robert Hyde instructed him to purchase
logs for the company's plant, but Quisaba, he refused to do so,
saying that such task is inconsistent with his position. The next
day, Hyde informed Quisaba of his temporary relief as internal
auditor so that he could carry out the instructions given. Hyde
warned him that failure to comply would be considered a
ground for his dismissal.
Quisaba filed a complaint for moral damages,
exemplary damages, termination pay and attorney's fees
against SIMVP and its VP Robert Hyde. Quisaba was NOT asking
for backwages nor reinstatement. Quisaba alleged that due to
SIMVP’s acts, he suffered mental anguish, serious anxiety,
besmirched reputation, wounded feelings, moral shock and
social humiliation.
SIMVP moved to dismiss the complaint on the ground of
lack of jurisdiction of the CFI, asserting that the proper forum is
the NLRC. Quisaba opposed this, and he informed the court
that an NLRC representative said that NLRC has no jurisdiction
over claims or suits for damages arising out of employee-
employer relationship. Nonetheless, CFI granted the motion to
dismiss on the ground that the complaint involves an employee-
employer relation.
ISSUE & HOLDING
Who has jurisdiction over the case? CFI has jurisdiction. This is a
CIVIL dispute, not a labor dispute.
RATIO
This case is concerned with a civil (not a labor) dispute, as it has
to do with an alleged violation of Quisaba's rights as a member
of society, and it does not involve an existing employee-
employer relation within the meaning of PD 21, Sec. 2(1).
Civil law consists of that mass of precepts that determine or
regulate the relations that exist between members of a society
for the protection of private interests.
NLRC jurisdiction is defined by PD 21, Sec. 2.
 All matters involving employee-employer relations
including all disputes and grievances which may otherwise lead
to strikes and lockouts under RA 875
 All strikes overtaken by Proc. 1081
 All pending cases in the Bureau of Labor Relations.
Although the acts complained of seemingly appear to
constitute "matters involving employee-employer relations,"
Quisaba’s complaint is grounded on the manner of his
dismissal and the consequent effects of such dismissal, not on
his dismissal per se, as he does not ask for reinstatement or
backwages.
The "right" of SIMVP to dismiss Quisaba should not be confused
with the manner in which the right was exercised and the effects
flowing therefrom. If the dismissal was done anti-socially or
oppressively, then SIMVP violated the following:
 NCC 1701 – prohibits acts of oppression by either capital
or labor against the other
 NCC 21 – makes a person liable for damages if he willfully
causes loss or injury to another in a manner that is contrary to
morals, good customs or public policy

Moral damages may be recovered in acts and actions referred
to in NCC 21. [NCC 2219 (10)]
ORDER SET ASIDE; CASE REMANDED FOR FURTHER PROCEEDING
St. Louis Realty Corporation vs. C.A. GR No L-46061 (November
14, 1984)
Facts: St. Louis Reality Corp. caused to be published on the
December 15, 1968 Sunday Times an advertisement featuring
the house of Dr. Conrado J. Aramil. Said advertisement was
entitled “Where the Heart is”, showed a picture of Dr. Aramil’s
house but with the family of Arcadio S. Acradio depicted as the
owners. It also had written text stating that the Arcadios had
purchased such house in Brookside Hills village at an affordable
rate. Such was done without the permission of Dr. Aramil. Upon
seeing a reprint of the advertisement on the same paper on
January 5, 1969, Dr. Aramil immediately wrote said reality
corporation stating that the latter did not obtain permission to
post his house in the advertisement and depict it as being
owned by another family. Dr. Aramil explained that it has
caused him humiliation as his colleagues and friends who
recognize his house or have been to such have uttered remarks
questioning the ownership of his house, his integrity, if he rented
the house from the Arcadios and even that his wife was that of
another husband. He then warned the corporation that he
would pursue legal action if such acts were not explained
satisfactorily to him within one week of receipt of the letter. Said
letter was received and answered by Ernesto Magtoto, an
officer of said corporation who was in charge of advertising. He
immediately stopped its publication and contacted Dr. Aramil
to apologise. However no rectification or apology was ever
published. Dr. Aramil’s counsel demanded actual, moral and
exemplary damages of P 110,000 from the corporation on
February 20, 1969. The corporation answered by claiming that it
was an honest mistake and that a rectification will be made.
The corporation published a new advertisement on March 18,
1969 which again portrayed the Arcadio family, but this time
with their real house. However no apology or rectification was
included. This led to the filing of a complaint for damages
against the said corporation on March 29, 1969. The lower court
and appellate court ruled in favor of Dr. Aramil; awarding him P
8,000 as actual damages, P 20,000 as moral damages and P
2,000 for attorney’s fees.
Issue: Whether the case is covered by article 26 of the Civil
Code?
Held: Yes, the case falls under said article which warrants the
award of damages to Dr. Aramil. Said article provides that
"every person shall respect the dignity, personality, privacy and
peace of mind of his neighbors and other persons". "Prying into
the privacy of another's residence" and "meddling with or
disturbing the private life or family relations of another" and
"similar acts", "though they may not constitute a criminal
offense, shall produce a cause of action for damages,
prevention and other relief". Such article was violated when the
corporation released an advertisement depicting Dr. Armil’s
home to be that of another, without Dr. Aramil’s permission.
Further, bad faith and negligence was evident as the
corporation refused to publish a rectification or apology despite
demands. The damages awarded are proper being
enunciated by Articles 2200, 2208 and 2219 of the Civil Code.
Article 2219 allows moral damages for acts mentioned in Article
26.
Gregorio v. CA, G.R. No. 179799 (11 September 2009)
Facts: Emma J. Datuin (Datuin) was the Officer-in-Charge of
the Accounts Receivable Department of Sansio Philippines, Inc.
(Sansio). Zenaida R. Gregorio (Gregorio) and Vito Belarmino
were proprietors of Alvi Marketing. Alvi Marketing bought
numerous appliances from Sansio and delivered three PNB
Checks as payments. These checks bounced and were found
to be insufficiently funded. Hence, Datuin filed an Affidavit of
Complaint for violation of BP 22 (Bouncing Checks Law) against
Gregorio and Belarmino. As the address stated in the
complaint was incorrect, Gregorio was unable to controvert the
charges against her. Consequently, she was indicted for three
(3) counts of violation of BP 22. The MeTC issued a warrant for
her arrest and was served upon her by the armed operatives of
the Public Assistance and Reaction Against Crime (PARAC) of
the DILG when she was visiting her husband and two (2)
daughters at their city residence. Gregorio was brought to
the PARAC-DILG Office where she was subjected to
fingerprinting and mug shots, and was detained. She was
released in the afternoon of the same day when her husband
posted a bond for her temporary liberty. MeTC – Gregorio
filed a Motion for Deferment of Arraignment alleging she could
not have issued the bounced checks since she did not even
have a checking account with PNB. This motion was granted
because Gregorio was not one of the signatories of the
bounced checks. The BP 22 case was eventually dismissed.
RTC – Gregorio filed a complaint for damages against
Datuin and Sansio. Datuin and Sansio filed a Motion to Dismiss
on the ground that the complaint, being one for damages
arising from malicious prosecution, failed to state a cause of
action, as the ultimate facts constituting the elements thereof
were not alleged in the complaint. The RTC denied the Motion
to Dismiss and directed Sansio and Datuin to pay Gregorio
P200,000.00 as moral damages; P10,000.00 as nominal
damages; P35,000.00 as litigation expenses; P30,000.00 as
attorneyÊs fees; and costs of the suit. The RTC expressly stated in
its Decision that the complaint was one for damages based on
quasi-delict and not on malicious prosecution. The CA
ordered the dismissal of the damage suit instituted by Gregorio.
Issue: Whether the complaint, a civil suit filed by Gregorio, is
based on quasi-delict or malicious prosecution?
Held: It is based on a quasi-delict.
The nature of an action is determined by the material
averments in the complaint and the character of the relief
sought. Undeniably, Gregorio’s civil complaint, read in its
entirety, is a complaint based on quasi-delict under Article 2176,
in relation to Article 26 of the Civil Code, rather than on
malicious prosecution. In every tort case filed under Article
2176 of the Civil Code, the plaintiff has to prove by a
preponderance of evidence: (1) the damages suffered by him;
(2) the fault or negligence of the defendant or some other
person to whose act he must respond; (3) the connection of
cause and effect between the fault or negligence and the
damages incurred; and (4) that there must be no preexisting
contractual relation between the parties. On the other hand,
Article 26 of the Civil Code grants a cause of action for
damages, prevention, and other relief in cases of breach,
though not necessarily constituting a criminal offense, of the
following rights: (1) right to personal dignity; (2) right to personal
security; (3) right to family relations; (4) right to social intercourse;
(5) right to privacy; and (6) right to peace of mind. A
scrutiny of Gregorio’s civil complaint reveals that the averments
thereof, taken together, fulfill the elements of Article 2176, in
relation to Article 26 of the Civil Code. Gregorio was falsely
indicted for three (3) counts of violation of B.P. Blg. 22. Although
she was never found at the office address of Alvi Marketing as
stated in the criminal complaint, Gregorio was conveniently
arrested by armed operatives of the PARAC-DILG at her city
residence while visiting her family. She suffered embarrassment
and humiliation over her sudden arrest and detention and she
had to spend time, effort, and money to clear her tarnished
name and reputation, considering that she had held several
honorable positions in different organizations and offices in the
public service. Sansio and Datuin are in error when they insist
that Gregorio’s complaint is based on malicious prosecution. In
an action to recover damages for malicious prosecution, it must
be alleged and established that Sansio and Datuin were
impelled by legal malice or bad faith in deliberately initiating an
action against Gregorio, knowing that the charges were false
and groundless, intending to vex and humiliate her.
Case Digest: Spouses Hing v. Choachuy, Sr.
G.R. No. 179736 : June 26, 2013
SPOUSES BILL AND VICTORIA HING,Petitioners, v. ALEXANDER
CHOACHUY, SR. and ALLAN CHOACHUY, Respondents.
DEL CASTILLO, J.:
FACTS:
On August 23, 2005, petitioner-spouses Bill and Victoria Hing filed
with the Regional Trial Court (RTC) of Mandaue City a
Complaintfor Injunction and Damages with prayer for issuance
of a Writ of Preliminary Mandatory Injunction/Temporary
Restraining Order (TRO), docketed as Civil Case MAN-5223 and
raffled to Branch 28, against respondents Alexander Choachuy,
Sr. and Allan Choachuy.
Petitioners alleged that they are the registered owners of a
parcel of land (Lot 1900-B) covered by Transfer Certificate of
Title (TCT) No. 42817 situated in Barangay Basak, City of
Mandaue, Cebu;that respondents are the owners of Aldo
Development & Resources, Inc. (Aldo) located at Lots 1901 and
1900-C, adjacent to the property of petitioners;that respondents
constructed an auto-repair shop building (Aldo Goodyear
Servitec) on Lot 1900-C; that in April 2005, Aldo filed a case
against petitioners for Injunction and Damages with Writ of
Preliminary Injunction/TRO, docketed as Civil Case No. MAN-
5125;that in that case, Aldo claimed that petitioners were
constructing a fence without a valid permit and that the said
construction would destroy the wall of its building, which is
adjacent to petitioners property;that the court, in that case,
denied Aldos application for preliminary injunction for failure to
substantiate its allegations;that, in order to get evidence to
support the said case, respondents on June 13, 2005 illegally set-
up and installed on the building of Aldo Goodyear Servitec two
video surveillance cameras facing petitioners property;that
respondents, through their employees and without the consent
of petitioners, also took pictures of petitioners on-going
construction;and that the acts of respondents violate petitioners
right to privacy.Thus, petitioners prayed that respondents be
ordered to remove the video surveillance cameras and
enjoined from conducting illegal surveillance.
In their Answer with Counterclaim,respondents claimed that
they did not install the video surveillance cameras,nor did they
order their employees to take pictures of petitioners
construction.They also clarified that they are not the owners of
Aldo but are mere stockholders.

On October 18, 2005, the RTC issued an Ordergranting the
application for a TRO.
Respondents moved for a reconsiderationbut the RTC denied
the same in its Orderdated February 6, 2006.
Aggrieved, respondents filed with the CA a Petition for
Certiorariunder Rule 65 of the Rules of Court with application for
a TRO and/or Writ of Preliminary Injunction.
On July 10, 2007, the CA issued its Decisiongranting the Petition
for Certiorari. The CA ruled that the Writ of Preliminary Injunction
was issued with grave abuse of discretion because petitioners
failed to show a clear and unmistakable right to an injunctive
writ.The CA explained that the right to privacy of residence
under Article 26(1) of the Civil Code was not violated since the
property subject of the controversy is not used as a residence.
The CA alsosaid that since respondents are not the owners of
the building, they could not have installed video surveillance
cameras.They are mere stockholders of Aldo, which has a
separate juridical personality.Thus, they are not the proper
parties.
ISSUE:
1. Whether or not there is a violation of petitioners right to
privacy?
2. Whether or not respondents are the proper parties to this suit?
HELD: Court of Appeals decision is reversed.
POLITICAL LAW: right to privacy
The right to privacy is enshrined in our Constitutionand in our
laws. It is defined as "the right to be free from unwarranted
exploitation of ones person or from intrusion into ones private
activities in such a way as to cause humiliation to a persons
ordinary sensibilities."It is the right of an individual "to be free
from unwarranted publicity, or to live without unwarranted
interference by the public in matters in which the public is not
necessarily concerned."Simply put, the right to privacy is "the
right to be let alone."
The Bill of Rights guarantees the peoples right to privacy and
protects them against the States abuse of power. In this regard,
the State recognizes the right of the people to be secure in their
houses. No one, not even the State, except "in case of
overriding social need and then only under the stringent
procedural safeguards," can disturb them in the privacy of their
homes.
CIVIL LAW: right to privacy under Article 26(1) of the Civil Code
covers business offices where the public are excluded
therefrom and only certain individuals are allowed to enter.
Article 26(1) of the Civil Code, on the other hand, protects an
individuals right to privacy and provides a legal remedy against
abuses that may be committed against him by other
individuals. It states:
Art. 26. Every person shall respect the dignity, personality,
privacy and peace of mind of his neighbors and other persons.
The following and similar acts, though they may not constitute a
criminal offense, shall produce a cause of action for damages,
prevention and other relief:
(1) Prying into the privacy of anothers residence;
This provision recognizes that a mans house is his castle, where
his right to privacy cannot be denied or even restricted by
others. It includes "any act of intrusion into, peeping or peering
inquisitively into the residence of another without the consent of
the latter."The phrase "prying into the privacy of anothers
residence," however, does not mean that only the residence is
entitled to privacy. As elucidated by Civil law expert Arturo M.
Tolentino:
Our Code specifically mentions "prying into the privacy of
anothers residence." This does not mean, however, that only the
residence is entitled to privacy, because the law covers also
"similar acts." A business office is entitled to the same privacy
when the public is excluded therefrom and only such individuals
as are allowed to enter may come in.
Thus, an individuals right to privacy under Article 26(1) of the
Civil Code should not be confined to his house or residence as it
may extend to places where he has the right to exclude the
public or deny them access. The phrase "prying into the privacy
of anothers residence," therefore, covers places, locations, or
even situations which an individual considers as private. And as
long as his right is recognized by society, other individuals may
not infringe on his right to privacy. The CA, therefore, erred in
limiting the application of Article 26(1) of the Civil Code only to
residences.
POLITICAL LAW: the "reasonable expectation of privacy" test to
determine whether there is a violation of the right to privacy.
In ascertaining whether there is a violation of the right to
privacy, courts use the "reasonable expectation of privacy" test.
This test determines whether a person has a reasonable
expectation of privacy and whether the expectation has been
violated.In Ople v. Torres,we enunciated that "the
reasonableness of a persons expectation of privacy depends
on a two-part test: (1) whether, by his conduct, the individual
has exhibited an expectation of privacy; and (2) this
expectation is one that society recognizes as reasonable."
Customs, community norms, and practices may, therefore, limit
or extend an individuals "reasonable expectation of privacy."
Hence, the reasonableness of a persons expectation of privacy
must be determined on a case-to-case basis since it depends
on the factual circumstances surrounding the case.
In this day and age, video surveillance cameras are installed
practically everywhere for the protection and safety of
everyone. The installation of these cameras, however, should
not cover places where there is reasonable expectation of
privacy, unless the consent of the individual, whose right to
privacy would be affected, was obtained. Nor should these
cameras be used to pry into the privacy of anothers residence
or business office as it would be no different from
eavesdropping, which is a crime under Republic Act No. 4200 or
the Anti-Wiretapping Law.
In this case, the RTC, in granting the application for Preliminary
Injunction, ruled that:
After careful consideration, there is basis to grant the
application for a temporary restraining order. The operation by
respondents of a revolving camera, even if it were mounted on
their building, violated the right of privacy of petitioners, who
are the owners of the adjacent lot. The camera does not only
focus on respondents property or the roof of the factory at the
back (Aldo Development and Resources, Inc.) but it actually
spans through a good portion of the land of petitioners.
Based on the ocular inspection, the Court understands why
petitioner Hing was so unyielding in asserting that the revolving
camera was set up deliberately to monitor the on[-]going
construction in his property. The monitor showed only a portion
of the roof of the factory of Aldo. If the purpose of respondents
in setting up a camera at the back is to secure the building and
factory premises, then the camera should revolve only towards
their properties at the back. Respondents camera cannot be
made to extend the view to petitioners lot. To allow the
respondents to do that over the objection of the petitioners
would violate the right of petitioners as property owners. "The
owner of a thing cannot make use thereof in such a manner as
to injure the rights of a third person."
The RTC, thus, considered that petitioners have a "reasonable
expectation of privacy" in their property, whether they use it as
a business office or as a residence and that the installation of
video surveillance cameras directly facing petitioners property
or covering a significant portion thereof, without their consent, is
a clear violation of their right to privacy. As we see then, the
issuance of a preliminary injunction was justified. We need not
belabor that the issuance of a preliminary injunction is
discretionary on the part of the court taking cognizance of the
case and should not be interfered with, unless there is grave
abuse of discretion committed by the court.Here, there is no
indication of any grave abuse of discretion. Hence, the CA
erred in finding that petitioners are not entitled to an injunctive
writ.
This brings us to the next question: whether respondents are the
proper parties to this suit.
REMEDEIAL LAW: A real party defendant

Section 2, Rule 3 of the Rules of Court provides:
SEC. 2. Parties-in-interest. A real party-in-interest is the party who
stands to be benefited or injured by the judgment in the suit, or
the party entitled to the avails of the suit. Unless otherwise
authorized by law or these Rules, every action must be
prosecuted or defended in the name of the real party-in-
interest.
A real party defendant is "one who has a correlative legal
obligation to redress a wrong done to the plaintiff by reason of
the defendants act or omission which had violated the legal
right of the former."
In ruling that respondents are not the proper parties, the CA
reasoned that since they do not own the building, they could
not have installed the video surveillance cameras. Such
reasoning, however, is erroneous. The fact that respondents are
not the registered owners of the building does not automatically
mean that they did not cause the installation of the video
surveillance cameras.
In their Complaint, petitioners claimed that respondents
installed the video surveillance cameras in order to fish for
evidence, which could be used against petitioners in another
case.During the hearing of the application for Preliminary
Injunction, petitioner Bill testified that when respondents installed
the video surveillance cameras, he immediately broached his
concerns but they did not seem to care,and thus, he reported
the matter to the barangay for mediation, and eventually, filed
a Complaint against respondents before the RTC.He also
admitted that as early as 1998 there has already been a dispute
between his family and the Choachuy family concerning the
boundaries of their respective properties.With these factual
circumstances in mind, we believe that respondents are the
proper parties to be impleaded.
Moreover, although Aldo has a juridical personality separate
and distinct from its stockholders, records show that it is a family-
owned corporation managed by the Choachuy family.
Also quite telling is the fact that respondents, notwithstanding
their claim that they are not owners of the building, allowed the
court to enter the compound of Aldo and conduct an ocular
inspection. The counsel for respondents even toured Judge
Marilyn Lagura-Yap inside the building and answered all her
questions regarding the set-up and installation of the video
surveillance cameras.And when respondents moved for
reconsideration of the Order dated October 18, 2005 of the
RTC, one of the arguments they raised is that Aldo would suffer
damages if the video surveillance cameras are removed and
transferred.Noticeably, in these instances, the personalities of
respondents and Aldo seem to merge.
All these taken together lead us to the inevitable conclusion
that respondents are merely using the corporate fiction of Aldo
as a shield to protect themselves from this suit. In view of the
foregoing, we find that respondents are the proper parties to
this suit.
G.R. No. 195549 September 3, 2014
WILLAWARE PRODUCTS CORPORATION vs.
JESICHRIS MANUFACTURING CORPORATION
FACTS: Respondent alleged that it is a duly registered
partnership engaged in the manufacture and distribution of
plastic and metal products. Since its registration in 1992,
[respondent] has been manufacturing in its Caloocan plant
and distributing throughout the Philippines plastic-made
automotive parts. Petitioner, on the other hand, which is
engaged in the manufacture and distribution of kitchenware
items made of plastic and metal has its office near that of
[respondent]. [Respondent] further alleged that in view of the
physical proximity of [petitioner’s] office to [respondent’s] office,
and in view of the fact that some of the [respondent’s]
employees had transferred to [petitioner], [petitioner] had
developed familiarity with [respondent’s] products, especially its
plastic-made automotive parts.
That sometime in November 2000, respondent discovered that
petitioner had been manufacturing and distributing the same
automotive parts with exactly similar design, same material and
colors but was selling these products at a lower price as
respondent’s plastic-made automotive parts and to the same
customers.
Respondent alleged that it had originated the use of plastic in
place of rubber in the manufacture of automotive under chassis
parts such as spring eye bushing, stabilizer bushing, shock
absorber bushing, center bearing cushions, among others.
Petitioner’s manufacture of the same automotive parts with
plastic material was taken from respondent’s idea of using
plastic for automotive parts. Also, petitioner deliberately copied
[respondent’s] products all of which acts constitute unfair
competition, is and are contrary to law, morals, good customs
and public policy and have caused [respondent] damages in
terms of lost and unrealized profits in the amount of TWO
MILLION PESOS as of the date of [respondent’s] complaint.
Furthermore, petitioner’s tortuous conduct compelled
respondent to institute this action. In its Answer, petitioner denies
all the allegations of the respondent except for the following
facts: that it is engaged in the manufacture and distribution of
kitchenware items made of plastic and metal and that there’s
physical proximity of [petitioner’s] office to [respondent]’s office,
and that some of respondent’s employees had transferred to
[petitioner] and that over the years [petitioner] had developed
familiarity with [respondent’s] products, especially its plastic
made automotive parts.
As its Affirmative Defenses, [petitioner] claims that there can be
no unfair competition as the plastic-made automotive parts are
mere reproductions of original parts and their construction and
composition merely conforms to the specifications of the
original parts of motor vehicles they intend to replace. Thus,
[respondent] cannot claim that it "originated" the use of plastic
for these automotive parts. Even assuming for the sake of
argument that [respondent] indeed originated the use of these
plastic automotive parts, it still has no exclusive right to use,
manufacture and sell these as it has no patent over these
products. Furthermore, [respondent] is not the only exclusive
manufacturer of these plastic-made automotive parts as there
are other establishments which were already openly selling
them to the public.3
RTC DECISION: ruled in favor of respondent. It ruled that
petitioner clearly invaded the rights or interest of respondent by
deliberately copying and performing acts amounting to unfair
competition. The RTC further opined that under the
circumstances, in order for respondent’s property rights to be
preserved, petitioner’s acts of manufacturing similar plastic-
made automotive parts such as those of respondent’s and the
selling of the sameproducts to respondent’s customers, which it
cultivated over the years, will have to be enjoined.
ISSUE: whether or not petitioner committed acts amounting to
unfair competition under Article 28 of the Civil Code.
RULING: Prefatorily, we would like to stress that the instant case
falls under Article 28 of the Civil Code on humanrelations, and
not unfair competition under Republic Act No. 8293,7 as the
present suit is a damage suit and the products are not covered
by patent registration. A fortiori, the existence of patent
registration is immaterial in the present case.
The concept of "unfair competition"under Article 28 is very much
broader than that covered by intellectual property laws. Under
the present article, which follows the extended concept of
"unfair competition" in American jurisdictions, the term
coverseven cases of discovery of trade secrets of a competitor,
bribery of his employees, misrepresentation of all kinds,
interference with the fulfillment of a competitor’s contracts, or
any malicious interference with the latter’s business.8
With that settled, we now come to the issue of whether or not
petitioner committed acts amounting tounfair competition
under Article 28 of the Civil Code.
We find the petition bereft of merit.
Article 28 of the Civil Code provides that "unfair competition in
agricultural, commercial or industrial enterprises or in labor
through the use of force, intimidation, deceit, machination or
any other unjust, oppressive or high-handed method shall give
rise to a right of action by the person who thereby suffers
damage."
From the foregoing, it is clear thatwhat is being sought to be
prevented is not competitionper sebut the use of unjust,
oppressive or high- handed methods which may deprive others
of a fair chance to engage in business or to earn a living.
Plainly,what the law prohibits is unfair competition and not
competition where the means usedare fair and legitimate.
In order to qualify the competition as "unfair," it must have two
characteristics: (1) it must involve an injury to a competitor or
trade rival, and (2) it must involve acts which are characterized
as "contrary to good conscience," or "shocking to judicial
sensibilities," or otherwise unlawful; in the language of our law,
these include force, intimidation, deceit, machination or any
other unjust, oppressive or high-handed method. The public
injury or interest is a minor factor; the essence of the matter
appears to be a private wrong perpetrated by unconscionable
means.9
Here, both characteristics are present.
First, both parties are competitors or trade rivals, both being
engaged in the manufacture of plastic-made automotive parts.
Second, the acts of the petitioner were clearly "contrary to
good conscience" as petitioner admitted having employed
respondent’s formeremployees, deliberately copied
respondent’s products and even went to the extent of selling
these products to respondent’s customers.10
To bolster this point, the CA correctly pointed out that
petitioner’s hiring of the former employees of respondent and
petitioner’s act of copying the subject plastic parts of
respondent were tantamount to unfair competition, viz.:
The testimonies of the witnesses indicate that [petitioner] was in
bad faith in competing with the business of
[respondent].1âwphi1 [Petitioner’s] acts can be characterized
as executed with mischievous subtle calculation. To illustrate, in
addition to the findings of the RTC, the Court observes that
[petitioner] is engaged in the production of plastic kitchenware
previous to its manufacturing of plasticautomotive spare parts, it
engaged the services of the then mold setter and maintenance
operator of [respondent], De Guzman, while he was employed
by the latter. De Guzman was hired by [petitioner] in order to
adjust its machinery since quality plastic automotive spare parts
were not being made. It baffles the Court why [petitioner]
cannot rely onits own mold setter and maintenance operator to
remedy its problem. [Petitioner’s] engagement of De Guzman
indicates that it is banking on his experience gained from
working for [respondent].
Another point we observe is that Yabut, who used to be a
warehouse and delivery man of [respondent], was fired
because he was blamed of spying in favor of [petitioner].
Despite this accusation, he did not get angry. Later on, he
applied for and was hired by [petitioner] for the same position
he occupied with [respondent]. These sequence of events
relating to his employment by [petitioner] is suspect too like the
situation with De Guzman.11
Thus, it is evident that petitioner isengaged in unfair competition
as shown by his act of suddenly shifting his business from
manufacturing kitchenware to plastic-made automotive parts;
his luring the employees of the respondent to transfer to his
employ and trying to discover the trade secrets of the
respondent.12
that it acted in bad faith in competing with the business of
respondent, to wit: [Petitioner], thru its General Manager,
William Salinas, Jr., admitted that it was never engaged in the
business of plastic-made automotive parts until recently, year
2000:
Atty. Bautista: The business name of Willaware Product
Corporation is kitchenware, it is (sic) not? Manufacturer of
kitchenware and distributor ofkitchenware, is it not? Mr. Salinas:
Yes, sir. Atty. Bautista: And you said you have known the
[respondent] Jesichris Manufacturing Co., you have known it to
be manufacturing plastic automotive products, is it not? Mr.
Salinas: Yes, sir. Atty. Bautista: In fact, you have been (sic)
physically become familiar with these products, plastic
automotive products of Jesichris? Mr. Salinas: Yes, sir.
How [petitioner] was able to manufacture the same products,
in terms of color, size, shape and composition as those sold by
Jesichris was due largely to the sudden transfer ofJesichris’
employees to Willaware.
In sum, petitioner is guilty of unfair competition under Article 28
of the Civil Code

Moreover, when a person starts an opposing place of business,

not for the sake of profit to himself, but regardless of loss and for
the sole purpose of driving his competitor out of business so that
later on he can take advantage of the effects of his malevolent
purpose, he is guilty of wanton wrong.13 As aptly observed by
the courta quo, the testimony of petitioner’s witnesses indicate