Republic of the Philippines

Supreme Court
Manila

THIRD DIVISION

GENEROSA ALMEDA LATORRE,

G.R. No. 183926
Petitioner,
Present:

VELASCO, JR., J.,

Acting Chairperson,
NACHURA,
LEONARDO-DE CASTRO,*
- versus -
PERALTA, and
MENDOZA, JJ.

Promulgated:
LUIS ESTEBAN LATORRE,
Respondent.
March 29, 2010

x------------------------------------------------------------------------------------x

RESOLUTION

NACHURA, J.:

Before this Court is a Petition for Review on Certiorari[1] under Rule 45, in relation
to Rule 41, of the Rules of Civil Procedure, assailing the decision[2] of the Regional
Trial Court (RTC) of Muntinlupa City, Branch 256, dated April 29, 2008.

The facts of the case are as follows:

In October 2000, petitioner Generosa Almeda Latorre (petitioner) filed before the
RTC of Muntinlupa City a Complaint[3] for Collection and Declaration of Nullity of
Deed of Absolute Sale with application for Injunction against her own son, herein
respondent Luis Esteban Latorre (respondent), and one Ifzal Ali (Ifzal).

Petitioner averred that, on September 28, 1999, respondent and Ifzal entered into a
Contract of Lease[4] over a 1,244-square meter real property, situated at No. 1366
Caballero St., Dasmarias Village, Makati City (subject property). Under the said
contract, respondent, as lessor, declared that he was the absolute and registered
owner of the subject property. Petitioner alleged that respondent's declaration
therein was erroneous because she and respondent were co-owners of the subject
property in equal shares.

Petitioner narrated that, on March 14, 1989, she and respondent executed their
respective Deeds of Donation, conveying the subject property in favor of The
Porfirio D. Latorre Memorial & Fr. Luis Esteban Latorre Foundation, Inc. (the
Foundation). Thus, Transfer Certificate of Title (TCT) No. 161963[5] was issued in
the name of the Foundation. Subsequently, on September 2, 1994, petitioner and
respondent executed separate Deeds of Revocation of Donation and Reconveyance
of the subject property, consented to by the Foundation, through the issuance of
appropriate corporate resolutions. However, the Deeds of Revocation were not
registered; hence, the subject property remained in the name of the Foundation.
Petitioner insisted, however, that respondent was fully aware that the subject
property was owned in common by both of them. To protect her rights as co-owner,
petitioner formally demanded from Ifzal the payment of her share of the rentals,
which the latter, however, refused to heed.

Moreover, petitioner averred that, on or about August 16, 2000, she discovered that
respondent caused the annotation of an adverse claim on the TCT of the subject
property, claiming full ownership over the same by virtue of a Deed of Absolute
Sale[6]dated March 21, 2000, allegedly executed by petitioner in favor of respondent.
Petitioner claimed that the deed was a falsified document; that her signature thereon
was forged by respondent; and that she never received P21 Million or any other
amount as consideration for her share of the subject property. Thus, petitioner
prayed that Ifzal be enjoined from paying the rentals to respondent, and the latter
from receiving said rentals; that both Ifzal and respondent be ordered to pay
petitioner her share of the rentals; and that respondent be enjoined from asserting
full ownership over the subject property and from committing any other act in
derogation of petitioner's interests therein. Petitioner also prayed for the payment of
moral and exemplary damages, litigation expenses, and costs of the suit.

Respondent immediately filed a Motion to Dismiss[7] on the sole ground that the
venue of the case was improperly laid. He stressed that while the complaint was
denominated as one for Collection and Declaration of Nullity of Deed of Absolute
Sale with application for Injunction, in truth the case was a real action affecting title
to and interest over the subject property. Respondent insisted that all of petitioner's
claims were anchored on her claim of ownership over one-half () portion of the
subject property. Since the subject property is located in Makati City, respondent
argued that petitioner should have filed the case before the RTC of Makati City and
not of Muntinlupa City.

Ifzal also filed his motion to dismiss on the ground of want of jurisdiction, asserting
that he was immune from suit because he was an officer of the Asian Development
Bank, an international organization.

The RTC issued a Temporary Restraining Order dated November 6, 2000,

restraining Ifzal from paying his rentals to respondent and enjoining the latter from
receiving from the former the aforesaid rentals. The RTC also directed both Ifzal
and respondent to pay petitioner her share of the rentals, with the corresponding
order against respondent not to commit any act in derogation of petitioner's interest
over the subject property.

In its Order dated January 2, 2001, the RTC denied respondent's motion to
dismiss. The RTC ruled that the nature of an action whether real or personal was
determined by the allegations in the complaint, irrespective of whether or not the
plaintiff was entitled to recover upon the claims asserted - a matter resolved only
after, and as a result of, a trial. Thus, trial on the merits ensued.

Undaunted, respondent filed an Answer Ad Cautelam[8] dated March 19, 2001,

insisting, among others, that the case was a real action and that the venue was
improperly laid.[9] Respondent narrated that he was a former Opus Dei priest but he
left the congregation in 1987 after he was maltreated by his Spanish superiors.
Respondent alleged that petitioner lived with him and his family from 1988 to 2000,
and that he provided for petitioner's needs. Respondent also alleged that, for almost
20 years, the Opus Dei divested the Latorre family of several real properties. Thus,
in order to spare the subject property from the Opus Dei, both petitioner and
respondent agreed to donate it to the Foundation. In 1994, when respondent got
married and sired a son, both petitioner and respondent decided to revoke the said
donation. The Foundation consented to the revocation. However, due to lack of
funds, the title was never transferred but remained in the name of the Foundation.

Respondent asseverated that he and his wife took good care of petitioner and that
they provided for her needs, spending a substantial amount of money for these
needs; that because of this, and the fact that the rentals paid for the use of the subject
property went to petitioner, both parties agreed that petitioner would convey her
share over the subject property to respondent; and that, on March 21, 2000,
petitioner executed a Deed of Absolute Sale in favor of respondent.

Respondent further alleged that sometime in March to May 2000, the relationship
of the parties, as mother and son, deteriorated. Petitioner left respondent's house
because he and his wife allegedly ignored, disrespected, and insulted
her.[10]Respondent claimed, however, that petitioner left because she detested his act
of firing their driver.[11] It was then that this case was filed against him by petitioner.

In the meantime, in its Order dated May 15, 2003, the RTC dismissed petitioner's
claim against Ifzal because the dispute was clearly between petitioner and
respondent.

On April 29, 2008, the RTC ruled in favor of respondent, disposing of the case in
this wise:

While the case herein filed by the plaintiff involves recovery of possession
of a real property situated at 1366 Caballero St., Dasmarias Village,
Makati City, the same should have been filed and tried in the Regional
Trial Court of Makati City who, undoubtedly, has jurisdiction to hear the
matter as aforementioned the same being clearly a real action.

WHEREFORE, in view of the foregoing, the above-entitled case is hereby

DISMISSED for want of jurisdiction, all in pursuance to the above-cited
jurisprudence and Rule 4 of the Rules of Court.
 SO ORDERED.[12]

Aggrieved, petitioner filed her Motion for Reconsideration,[13] which the RTC
denied in its Order[14] dated July 24, 2008 for lack of merit.

Hence, this Petition, claiming that the RTC erred in treating the venue as jurisdiction
and in treating petitioner's complaint as a real action.

While the instant case was pending resolution before this Court, petitioner passed
away on November 14, 2009. Thus, petitioner's counsel prayed that, pending the
appointment of a representative of petitioner's estate, notices of the proceedings
herein be sent to petitioners other son, Father Roberto A. Latorre.[15]

As early as the filing of the complaint, this case had been marred by numerous
procedural infractions committed by petitioner, by respondent, and even by the
RTC, all of which cannot be disregarded by this Court.

First. Petitioner filed her complaint with the RTC of Muntinlupa City instead of the
RTC of Makati City, the latter being the proper venue in this case.

Sections 1 and 2, Rule 4 of the 1997 Rules of Civil Procedure provide an answer to
the issue of venue.[16] Actions affecting title to or possession of real property or an
interest therein (real actions) shall be commenced and tried in the proper court that
has territorial jurisdiction over the area where the real property is situated. On the
other hand, all other actions (personal actions) shall be commenced and tried in the
proper courts where the plaintiff or any of the principal plaintiffs resides or where
the defendant or any of the principal defendants resides.[17] The action in the RTC,
other than for Collection, was for the Declaration of Nullity of the Deed of Absolute
Sale involving the subject property, which is located at No. 1366 Caballero
St.,Dasmarias Village, Makati City. The venue for such action is unquestionably the
proper court of Makati City, where the real property or part thereof lies, not the RTC
of Muntinlupa City.[18]

In this jurisdiction, we adhere to the principle that the nature of an action is

determined by the allegations in the Complaint itself, rather than by its title or
heading.[19] It is also a settled rule that what determines the venue of a case is the
primary objective for the filing of the case.[20] In her Complaint, petitioner sought
the nullification of the Deed of Absolute Sale on the strength of two basic claims
that (1) she did not execute the deed in favor of respondent; and (2) thus, she still
owned one half () of the subject property. Indubitably, petitioner's complaint is a
real action involving the recovery of the subject property on the basis of her co-
ownership thereof.
Second. The RTC also committed a procedural blunder when it denied respondent's
motion to dismiss on the ground of improper venue.

The RTC insisted that trial on the merits be conducted even when it was awfully
glaring that the venue was improperly laid, as pointed out by respondent in his
motion to dismiss. After trial, the RTC eventually dismissed the case on the ground
of lack of jurisdiction, even as it invoked, as justification, the rules and jurisprudence
on venue. Despite the conduct of trial, the RTC failed to adjudicate this case on the
merits.

Third. Respondent also did not do very well, procedurally. When the RTC denied
his Motion to Dismiss, respondent could have filed a petition for certiorari and/or
prohibition inasmuch as the denial of the motion was done without jurisdiction or
in excess of jurisdiction or with grave abuse of discretion amounting to lack of
jurisdiction.[21] However, despite this lapse, it is clear that respondent did not waive
his objections to the fact of improper venue, contrary to petitioner's assertion.
Notably, after his motion to dismiss was denied, respondent filed a Motion for
Reconsideration to contest such denial. Even in his Answer Ad Cautelam,
respondent stood his ground that the case ought to be dismissed on the basis of
improper venue.

Finally, petitioner came directly to this Court on a Petition for Review

on Certiorari under Rule 45, in relation to Rule 41, of the Rules of Civil Procedure
on alleged pure questions of law. In Murillo v. Consul,[22] we laid down a doctrine
that was later adopted by the 1997 Revised Rules of Civil Procedure. In that case,
this Court had the occasion to clarify the three (3) modes of appeal from decisions
of the RTC, namely: (1) ordinary appeal or appeal by writ of error, where judgment
was rendered in a civil or criminal action by the RTC in the exercise of its original
jurisdiction; (2) petition for review, where judgment was rendered by the RTC in
the exercise of its appellate jurisdiction; and (3) petition for review to the Supreme
Court.

The first mode of appeal, governed by Rule 41, is brought to the Court of Appeals
(CA) on questions of fact or mixed questions of fact and law. The second mode of
appeal, covered by Rule 42, is brought to the CA on questions of fact, of law, or
mixed questions of fact and law. The third mode of appeal, provided in Rule 45, is
filed with the Supreme Court only on questions of law.

A question of law arises when there is doubt as to what the law is on a certain state
of facts, while there is a question of fact when the doubt arises as to the truth or
falsity of the alleged facts.[23] Our ruling in Velayo-Fong v. Velayo[24] is instructive:

A question of law arises when there is doubt as to what the law is on a

certain state of facts, while there is a question of fact when the doubt arises
as to the truth or falsity of the alleged facts. For a question to be one of
law, the same must not involve an examination of the probative value of
the evidence presented by the litigants or any of them. The resolution of
the issue must rest solely on what the law provides on the given set of
circumstances. Once it is clear that the issue invites a review of the
evidence presented, the question posed is one of fact. Thus, the test of
whether a question is one of law or of fact is not the appellation given to
such question by the party raising the same; rather, it is whether the
appellate court can determine the issue raised without reviewing or
evaluating the evidence, in which case, it is a question of law; otherwise
it is a question of fact.[25]

In her Reply to respondents Comment,[26] petitioner prayed that this Court decide
the case on the merits. To do so, however, would require the examination by this
Court of the probative value of the evidence presented,
taking into account the fact that the RTC failed to adjudicate this controversy on the
merits. This, unfortunately, we cannot do. It thus becomes exceedingly clear that the
filing of the case directly with this Court ran afoul of the doctrine of hierarchy of
courts. Pursuant to this doctrine, direct resort from the lower courts to the Supreme
Court will not be entertained unless the appropriate remedy sought cannot be
obtained in the lower tribunals. This Court is a court of last resort, and must so
remain if it is to satisfactorily perform the functions assigned to it by the
Constitution and by immemorial tradition.[27]

Accordingly, we find no merit in the instant petition. Neither do we find any

reversible error in the trial courts dismissal of the case ostensibly for want of
jurisdiction, although the trial court obviously meant to dismiss the case on the
ground of improper venue.

WHEREFORE, the instant Petition is DENIED. No costs.

SO ORDERED.
FIRST DIVISION

[G.R. No. 144225. June 17, 2003]

SPOUSES GODOFREDO ALFREDO and CARMEN LIMON ALFREDO,

SPOUSES ARNULFO SAVELLANO and EDITHA B. SAVELLANO,
DANTON D. MATAWARAN, SPOUSES DELFIN F. ESPIRITU, JR.
and ESTELA S. ESPIRITU and ELIZABETH TUAZON, petitioners,
vs. SPOUSES ARMANDO BORRAS and ADELIA LOBATON
BORRAS, respondents.

DECISION
CARPIO, J.:

The Case

Before us is a petition for review assailing the Decision of the Court of

[1]

Appeals dated 26 November 1999 affirming the decision of the Regional Trial
[2]

Court of Bataan, Branch 4, in Civil Case No. DH-256-94. Petitioners also

question the Resolution of the Court of Appeals dated 26 July 2000 denying
petitioners motion for reconsideration.

The Antecedent Facts

 A parcel of land measuring 81,524 square meters (Subject Land) in Barrio
Culis, Mabiga, Hermosa, Bataan is the subject of controversy in this case. The
registered owners of the Subject Land were petitioner spouses, Godofredo
Alfredo (Godofredo) and Carmen Limon Alfredo (Carmen). The Subject Land is
covered by Original Certificate of Title No. 284 (OCT No. 284) issued to
Godofredo and Carmen under Homestead Patent No. V-69196.
On 7 March 1994, the private respondents, spouses Armando Borras
(Armando) and Adelia Lobaton Borras (Adelia), filed a complaint for specific
performance against Godofredo and Carmen before the Regional Trial Court of
Bataan, Branch 4. The case was docketed as Civil Case No. DH-256-94.
Armando and Adelia alleged in their complaint that Godofredo and Carmen
mortgaged the Subject Land for P7,000.00 with the Development Bank of the
Philippines (DBP). To pay the debt, Carmen and Godofredo sold the Subject
Land to Armando and Adelia for P15,000.00, the buyers to pay the DBP loan
and its accumulated interest, and the balance to be paid in cash to the sellers.
Armando and Adelia gave Godofredo and Carmen the money to pay the
loan to DBP which signed the release of mortgage and returned the owners
duplicate copy of OCT No. 284 to Godofredo and Carmen. Armando and Adelia
subsequently paid the balance of the purchase price of the Subject Land for
which Carmen issued a receipt dated 11 March 1970. Godofredo and Carmen
then delivered to Adelia the owners duplicate copy of OCT No. 284, with the
document of cancellation of mortgage, official receipts of realty tax payments,
and tax declaration in the name of Godofredo. Godofredo and Carmen
introduced Armando and Adelia, as the new owners of the Subject Land, to the
Natanawans, the old tenants of the Subject Land. Armando and Adelia then
took possession of the Subject Land.
In January 1994, Armando and Adelia learned that hired persons had
entered the Subject Land and were cutting trees under instructions of allegedly
new owners of the Subject Land. Subsequently, Armando and Adelia
discovered that Godofredo and Carmen had re-sold portions of the Subject
Land to several persons.
On 8 February 1994, Armando and Adelia filed an adverse claim with the
Register of Deeds of Bataan. Armando and Adelia discovered that Godofredo
and Carmen had secured an owners duplicate copy of OCT No. 284 after filing
a petition in court for the issuance of a new copy. Godofredo and Carmen
claimed in their petition that they lost their owners duplicate copy. Armando and
Adelia wrote Godofredo and Carmen complaining about their acts, but the latter
did not reply. Thus, Armando and Adelia filed a complaint for specific
performance.
 On 28 March 1994, Armando and Adelia amended their complaint to include
the following persons as additional defendants: the spouses Arnulfo Savellano
and Editha B. Savellano, Danton D. Matawaran, the spouses Delfin F. Espiritu,
Jr. and Estela S. Espiritu, and Elizabeth Tuazon (Subsequent Buyers). The
Subsequent Buyers, who are also petitioners in this case, purchased from
Godofredo and Carmen the subdivided portions of the Subject Land. The
Register of Deeds of Bataan issued to the Subsequent Buyers transfer
certificates of title to the lots they purchased.
In their answer, Godofredo and Carmen and the Subsequent
Buyers (collectively petitioners) argued that the action is unenforceable under
the Statute of Frauds. Petitioners pointed out that there is no written instrument
evidencing the alleged contract of sale over the Subject Land in favor of
Armando and Adelia. Petitioners objected to whatever parole evidence
Armando and Adelia introduced or offered on the alleged sale unless the same
was in writing and subscribed by Godofredo. Petitioners asserted that the
Subsequent Buyers were buyers in good faith and for value. As counterclaim,
petitioners sought payment of attorneys fees and incidental expenses.
Trial then followed. Armando and Adelia presented the following witnesses:
Adelia, Jesus Lobaton, Roberto Lopez, Apolinario Natanawan, Rolando
Natanawan, Tomas Natanawan, and Mildred Lobaton. Petitioners presented
two witnesses, Godofredo and Constancia Calonso.
On 7 June 1996, the trial court rendered its decision in favor of Armando
and Adelia. The dispositive portion of the decision reads:

WHEREFORE, premises considered, judgment is hereby rendered in favor of

plaintiffs, the spouses Adelia Lobaton Borras and Armando F. Borras, and against the
defendant-spouses Godofredo Alfredo and Carmen Limon Alfredo, spouses Arnulfo
Sabellano and Editha B. Sabellano, spouses Delfin F. Espiritu, Jr. and Estela S.
Espiritu, Danton D. Matawaran and Elizabeth Tuazon, as follows:

1. Declaring the Deeds of Absolute Sale of the disputed parcel of land

(covered by OCT No. 284) executed by the spouses Godofredo
Alfredo and Camen Limon Alfredo in favor of spouses Arnulfo
Sabellano and Editha B. Sabellano, spouses Delfin F. Espiritu,
Danton D. Matawaran and Elizabeth Tuazon, as null and void;

2. Declaring the Transfer Certificates of Title Nos. T-163266 and T-

163267 in the names of spouses Arnulfo Sabellano and Editha B.
Sabellano; Transfer Certificates of Title Nos. T-163268 and
163272 in the names of spouses Delfin F. Espiritu, Jr. and Estela
 S. Espiritu; Transfer Certificates of Title Nos. T-163269 and T-
163271 in the name of Danton D. Matawaran; and Transfer
Certificate of Title No. T-163270 in the name of Elizabeth
Tuazon, as null and void and that the Register of Deeds of Bataan
is hereby ordered to cancel said titles;

3. Ordering the defendant-spouses Godofredo Alfredo and Carmen Limon

Alfredo to execute and deliver a good and valid Deed of Absolute
Sale of the disputed parcel of land (covered by OCT No. 284) in
favor of the spouses Adelia Lobaton Borras and Armando F.
Borras within a period of ten (10) days from the finality of this
decision;

4. Ordering defendant-spouses Godofredo Alfredo and Carmen Limon

Alfredo to surrender their owners duplicate copy of OCT No. 284
issued to them by virtue of the Order dated May 20, 1992 of the
Regional Trial Court of Bataan, Dinalupihan Branch, to the
Registry of Deeds of Bataan within ten (10) days from the finality
of this decision, who, in turn, is directed to cancel the same as
there exists in the possession of herein plaintiffs of the owners
duplicate copy of said OCT No. 284 and, to restore and/or
reinstate OCT No. 284 of the Register of Deeds of Bataan to its
full force and effect;

5. Ordering the defendant-spouses Godofredo Alfredo and Carmen Limon

Alfredo to restitute and/or return the amount of the respective
purchase prices and/or consideration of sale of the disputed
parcels of land they sold to their co-defendants within ten (10)
days from the finality of this decision with legal interest thereon
from date of the sale;

6. Ordering the defendants, jointly and severally, to pay plaintiff-spouses

the sum of P20,000.00 as and for attorneys fees and litigation
expenses; and

7. Ordering defendants to pay the costs of suit.

Defendants counterclaims are hereby dismissed for lack of merit.

SO ORDERED. [3]

Petitioners appealed to the Court of Appeals.

 On 26 November 1999, the Court of Appeals issued its Decision affirming
the decision of the trial court, thus:

WHEREFORE, premises considered, the appealed decision in Civil Case No. DH-
256-94 is hereby AFFIRMED in its entirety. Treble costs against the defendants-
appellants.

SO ORDERED. [4]

On 26 July 2000, the Court of Appeals denied petitioners motion for

reconsideration.

The Ruling of the Trial Court

The trial court ruled that there was a perfected contract of sale between the
spouses Godofredo and Carmen and the spouses Armando and Adelia. The
trial court found that all the elements of a contract of sale were present in this
case. The object of the sale was specifically identified as the 81,524-square
meter lot in Barrio Culis, Mabigas, Hermosa, Bataan, covered by OCT No. 284
issued by the Registry of Deeds of Bataan. The purchase price was fixed
at P15,000.00, with the buyers assuming to pay the sellers P7,000.00 DBP
mortgage loan including its accumulated interest. The balance of the purchase
price was to be paid in cash to the sellers. The last payment of P2,524.00
constituted the full settlement of the purchase price and this was paid on 11
March 1970 as evidenced by the receipt issued by Carmen.
The trial court found the following facts as proof of a perfected contract of
sale: (1) Godofredo and Carmen delivered to Armando and Adelia the Subject
Land; (2) Armando and Adelia treated as their own tenants the tenants of
Godofredo and Carmen; (3) Godofredo and Carmen turned over to Armando
and Adelia documents such as the owners duplicate copy of the title of the
Subject Land, tax declaration, and the receipts of realty tax payments in the
name of Godofredo; and (4) the DBP cancelled the mortgage on the Subject
Property upon payment of the loan of Godofredo and Carmen. Moreover, the
receipt of payment issued by Carmen served as an acknowledgment, if not a
ratification, of the verbal sale between the sellers and the buyers. The trial court
ruled that the Statute of Frauds is not applicable because in this case the sale
was perfected.
The trial court concluded that the Subsequent Buyers were not innocent
purchasers. Not one of the Subsequent Buyers testified in court on how they
purchased their respective lots. The Subsequent Buyers totally depended on
the testimony of Constancia Calonso (Calonso) to explain the subsequent
sale. Calonso, a broker, negotiated with Godofredo and Carmen the sale of the
Subject Land which Godofredo and Carmen subdivided so they could sell anew
portions to the Subsequent Buyers.
Calonso admitted that the Subject Land was adjacent to her own lot. The
trial court pointed out that Calonso did not inquire on the nature of the tenancy
of the Natanawans and on who owned the Subject Land. Instead, she bought
out the tenants for P150,000.00. The buy out was embodied in a Kasunduan.
Apolinario Natanawan (Apolinario) testified that he and his wife accepted the
money and signed the Kasunduan because Calonso and the Subsequent
Buyers threatened them with forcible ejectment. Calonso brought Apolinario to
the Agrarian Reform Office where he was asked to produce the documents
showing that Adelia is the owner of the Subject Land. Since Apolinario could
not produce the documents, the agrarian officer told him that he would lose the
case. Thus, Apolinario was constrained to sign the Kasunduan and accept
the P150,000.00.
Another indication of Calonsos bad faith was her own admission that she
saw an adverse claim on the title of the Subject Land when she registered the
deeds of sale in the names of the Subsequent Buyers. Calonso ignored the
adverse claim and proceeded with the registration of the deeds of sale.
The trial court awarded P20,000.00 as attorneys fees to Armando and
Adelia. In justifying the award of attorneys fees, the trial court invoked Article
2208 (2) of the Civil Code which allows a court to award attorneys fees,
including litigation expenses, when it is just and equitable to award the
same. The trial court ruled that Armando and Adelia are entitled to attorneys
fees since they were compelled to file this case due to petitioners refusal to
heed their just and valid demand.

The Ruling of the Court of Appeals

The Court of Appeals found the factual findings of the trial court well
supported by the evidence. Based on these findings, the Court of Appeals also
concluded that there was a perfected contract of sale and the Subsequent
Buyers were not innocent purchasers.
The Court of Appeals ruled that the handwritten receipt dated 11 March
1970 is sufficient proof that Godofredo and Carmen sold the Subject Land to
Armando and Adelia upon payment of the balance of the purchase price. The
Court of Appeals found the recitals in the receipt as sufficient to serve as the
memorandum or note as a writing under the Statute of Frauds. The Court of
[5]

Appeals then reiterated the ruling of the trial court that the Statute of Frauds
does not apply in this case.
The Court of Appeals gave credence to the testimony of a witness of
Armando and Adelia, Mildred Lobaton, who explained why the title to the
Subject Land was not in the name of Armando and Adelia. Lobaton testified
that Godofredo was then busy preparing to leave for Davao. Godofredo
promised that he would sign all the papers once they were ready. Since
Armando and Adelia were close to the family of Carmen, they trusted
Godofredo and Carmen to honor their commitment. Armando and Adelia had
no reason to believe that their contract of sale was not perfected or validly
executed considering that they had received the duplicate copy of OCT No. 284
and other relevant documents. Moreover, they had taken physical possession
of the Subject Land.
The Court of Appeals held that the contract of sale is not void even if only
Carmen signed the receipt dated 11 March 1970. Citing Felipe v. Heirs of
Maximo Aldon, the appellate court ruled that a contract of sale made by the
[6]

wife without the husbands consent is not void but merely voidable. The Court
of Appeals further declared that the sale in this case binds the conjugal
partnership even if only the wife signed the receipt because the proceeds of the
sale were used for the benefit of the conjugal partnership. The appellate court
based this conclusion on Article 161 of the Civil Code.
[7]

The Subsequent Buyers of the Subject Land cannot claim that they are
buyers in good faith because they had constructive notice of the adverse claim
of Armando and Adelia. Calonso, who brokered the subsequent sale, testified
that when she registered the subsequent deeds of sale, the adverse claim of
Armando and Adelia was already annotated on the title of the Subject Land. The
Court of Appeals believed that the act of Calonso and the Subsequent Buyers
in forcibly ejecting the Natanawans from the Subject Land buttresses the
conclusion that the second sale was tainted with bad faith from the very
beginning.
Finally, the Court of Appeals noted that the issue of prescription was not
raised in the Answer. Nonetheless, the appellate court explained that since this
action is actually based on fraud, the prescriptive period is four years, with the
period starting to run only from the date of the discovery of the fraud. Armando
and Adelia discovered the fraudulent sale of the Subject Land only in January
1994. Armando and Adelia lost no time in writing a letter to Godofredo and
Carmen on 2 February 1994 and filed this case on 7 March 1994.Plainly,
Armando and Adelia did not sleep on their rights or lose their rights by
prescription.
The Court of Appeals sustained the award of attorneys fees and imposed
treble costs on petitioners.

The Issues

Petitioners raise the following issues:

I

Whether the alleged sale of the Subject Land in favor of Armando and Adelia
is valid and enforceable, where (1) it was orally entered into and not in
writing; (2) Carmen did not obtain the consent and authority of her husband,
Godofredo, who was the sole owner of the Subject Land in whose name the
title thereto (OCT No. 284) was issued; and (3) it was entered into during the
25-year prohibitive period for alienating the Subject Land without the approval
of the Secretary of Agriculture and Natural Resources.

II

Whether the action to enforce the alleged oral contract of sale brought after 24
years from its alleged perfection had been barred by prescription and by
laches.

III

Whether the deeds of absolute sale and the transfer certificates of title over the
portions of the Subject Land issued to the Subsequent Buyers, innocent
purchasers in good faith and for value whose individual titles to their
respective lots are absolute and indefeasible, are valid.

IV

Whether petitioners are liable to pay Armando and Adelia P20,0000.00 as

attorneys fees and litigation expenses and the treble costs, where the claim of
Armando and Adelia is clearly unfounded and baseless.

Whether petitioners are entitled to the counterclaim for attorneys fees and
litigation expenses, where they have sustained such expenses by reason of
 institution of a clearly malicious and unfounded action by Armando and
Adelia.[8]

The Courts Ruling

The petition is without merit.

In a petition for review on certiorari under Rule 45, this Court reviews only
errors of law and not errors of facts. The factual findings of the appellate court
[9]

are generally binding on this Court. This applies with greater force when both
[10]

the trial court and the Court of Appeals are in complete agreement on their
factual findings. In this case, there is no reason to deviate from the findings of
[11]

the lower courts. The facts relied upon by the trial and appellate courts are
borne out by the record. We agree with the conclusions drawn by the lower
courts from these facts.

Validity and Enforceability of the Sale

The contract of sale between the spouses Godofredo and Carmen and the
spouses Armando and Adelia was a perfected contract. A contract is perfected
once there is consent of the contracting parties on the object certain and on the
cause of the obligation. In the instant case, the object of the sale is the Subject
[12]

Land, and the price certain is P15,000.00. The trial and appellate courts found
that there was a meeting of the minds on the sale of the Subject Land and on
the purchase price of P15,000.00. This is a finding of fact that is binding on this
Court. We find no reason to disturb this finding since it is supported by
substantial evidence.
The contract of sale of the Subject Land has also been consummated
because the sellers and buyers have performed their respective obligations
under the contract. In a contract of sale, the seller obligates himself to transfer
the ownership of the determinate thing sold, and to deliver the same, to the
buyer who obligates himself to pay a price certain to the seller. In the instant
[13]

case, Godofredo and Carmen delivered the Subject Land to Armando and
Adelia, placing the latter in actual physical possession of the Subject Land. This
physical delivery of the Subject Land also constituted a transfer of ownership of
the Subject Land to Armando and Adelia. Ownership of the thing sold is
[14]

transferred to the vendee upon its actual or constructive delivery. Godofredo

[15]

and Carmen also turned over to Armando and Adelia the documents of
ownership to the Subject Land, namely the owners duplicate copy of OCT No.
284, the tax declaration and the receipts of realty tax payments.
On the other hand, Armando and Adelia paid the full purchase price as
evidenced by the receipt dated 11 March 1970 issued by Carmen. Armando
and Adelia fulfilled their obligation to provide the P7,000.00 to pay the DBP loan
of Godofredo and Carmen, and to pay the latter the balance of P8,000.00 in
cash. The P2,524.00 paid under the receipt dated 11 March 1970 was the last
installment to settle fully the purchase price. Indeed, upon payment to DBP of
the P7,000.00 and the accumulated interests, the DBP cancelled the mortgage
on the Subject Land and returned the owners duplicate copy of OCT No. 284
to Godofredo and Carmen.
The trial and appellate courts correctly refused to apply the Statute of
Frauds to this case. The Statute of Frauds provides that a contract for the sale
[16]

of real property shall be unenforceable unless the contract or some note or

memorandum of the sale is in writing and subscribed by the party charged or
his agent. The existence of the receipt dated 11 March 1970, which is a
memorandum of the sale, removes the transaction from the provisions of the
Statute of Frauds.
The Statute of Frauds applies only to executory contracts and not to
contracts either partially or totally performed. Thus, where one party has
[17]

performed ones obligation, oral evidence will be admitted to prove the

agreement. In the instant case, the parties have consummated the sale of the
[18]

Subject Land, with both sellers and buyers performing their respective
obligations under the contract of sale. In addition, a contract that violates the
Statute of Frauds is ratified by the acceptance of benefits under the
contract. Godofredo and Carmen benefited from the contract because they
[19]

paid their DBP loan and secured the cancellation of their mortgage using the
money given by Armando and Adelia. Godofredo and Carmen also accepted
payment of the balance of the purchase price.
Godofredo and Carmen cannot invoke the Statute of Frauds to deny the
existence of the verbal contract of sale because they have performed their
obligations, and have accepted benefits, under the verbal contract. Armando
[20]

and Adelia have also performed their obligations under the verbal
contract. Clearly, both the sellers and the buyers have consummated the verbal
contract of sale of the Subject Land. The Statute of Frauds was enacted to
prevent fraud. This law cannot be used to advance the very evil the law seeks
[21]

to prevent.
Godofredo and Carmen also claim that the sale of the Subject Land to
Armando and Adelia is void on two grounds. First, Carmen sold the Subject
Land without the marital consent of Godofredo. Second, the sale was made
during the 25-year period that the law prohibits the alienation of land grants
without the approval of the Secretary of Agriculture and Natural Resources.
These arguments are without basis.
The Family Code, which took effect on 3 August 1988, provides that any
alienation or encumbrance made by the husband of the conjugal partnership
property without the consent of the wife is void. However, when the sale is made
before the effectivity of the Family Code, the applicable law is the Civil Code. [22]

Article 173 of the Civil Code provides that the disposition of conjugal
property without the wifes consent is not void but merely voidable. Article 173
reads:

The wife may, during the marriage, and within ten years from the transaction
questioned, ask the courts for the annulment of any contract of the husband entered
into without her consent, when such consent is required, or any act or contract of the
husband which tends to defraud her or impair her interest in the conjugal partnership
property. Should the wife fail to exercise this right, she or her heirs, after the
dissolution of the marriage, may demand the value of property fraudulently alienated
by the husband.

In Felipe v. Aldon, we applied Article 173 in a case where the wife sold some
[23]

parcels of land belonging to the conjugal partnership without the consent of the
husband. We ruled that the contract of sale was voidable subject to annulment
by the husband. Following petitioners argument that Carmen sold the land to
Armando and Adelia without the consent of Carmens husband, the sale would
only be voidable and not void.
However, Godofredo can no longer question the sale. Voidable contracts
are susceptible of ratification. Godofredo ratified the sale when he introduced
[24]

Armando and Adelia to his tenants as the new owners of the Subject Land. The
trial court noted that Godofredo failed to deny categorically on the witness stand
the claim of the complainants witnesses that Godofredo introduced Armando
and Adelia as the new landlords of the tenants. That Godofredo and Carmen
[25]

allowed Armando and Adelia to enjoy possession of the Subject Land for 24
years is formidable proof of Godofredos acquiescence to the sale. If the sale
was truly unauthorized, then Godofredo should have filed an action to annul the
sale. He did not. The prescriptive period to annul the sale has long
lapsed.Godofredos conduct belies his claim that his wife sold the Subject Land
without his consent.
 Moreover, Godofredo and Carmen used most of the proceeds of the sale to
pay their debt with the DBP. We agree with the Court of Appeals that the sale
redounded to the benefit of the conjugal partnership. Article 161 of the Civil
Code provides that the conjugal partnership shall be liable for debts and
obligations contracted by the wife for the benefit of the conjugal partnership.
Hence, even if Carmen sold the land without the consent of her husband, the
sale still binds the conjugal partnership.
Petitioners contend that Godofredo and Carmen did not deliver the title of
the Subject Land to Armando and Adelia as shown by this portion of Adelias
testimony on cross-examination:
Q -- No title was delivered to you by Godofredo Alfredo?
A -- I got the title from Julie Limon because my sister told me.[26]

Petitioners raise this factual issue for the first time. The Court of Appeals
could have passed upon this issue had petitioners raised this earlier. At any
rate, the cited testimony of Adelia does not convincingly prove that Godofredo
and Carmen did not deliver the Subject Land to Armando and Adelia. Adelias
cited testimony must be examined in context not only with her entire testimony
but also with the other circumstances.
Adelia stated during cross-examination that she obtained the title of the
Subject Land from Julie Limon (Julie), her classmate in college and the sister
of Carmen. Earlier, Adelias own sister had secured the title from the father of
Carmen. However, Adelias sister, who was about to leave for the United States,
gave the title to Julie because of the absence of the other documents. Adelias
sister told Adelia to secure the title from Julie, and this was how Adelia obtained
the title from Julie.
It is not necessary that the seller himself deliver the title of the property to
the buyer because the thing sold is understood as delivered when it is placed
in the control and possession of the vendee. To repeat, Godofredo and
[27]

Carmen themselves introduced the Natanawans, their tenants, to Armando and

Adelia as the new owners of the Subject Land. From then on, Armando and
Adelia acted as the landlords of the Natanawans. Obviously, Godofredo and
Carmen themselves placed control and possession of the Subject Land in the
hands of Armando and Adelia.
Petitioners invoke the absence of approval of the sale by the Secretary of
Agriculture and Natural Resources to nullify the sale. Petitioners never raised
this issue before the trial court or the Court of Appeals. Litigants cannot raise
an issue for the first time on appeal, as this would contravene the basic rules of
fair play, justice and due process. However, we will address this new issue to
[28]

finally put an end to this case.

The sale of the Subject Land cannot be annulled on the ground that the
Secretary did not approve the sale, which was made within 25 years from the
issuance of the homestead title. Section 118 of the Public Land Act
(Commonwealth Act No. 141) reads as follows:

SEC. 118. Except in favor of the Government or any of its branches, units, or
institutions or legally constituted banking corporation, lands acquired under free
patent or homestead provisions shall not be subject to encumbrance or alienation from
the date of the approval of the application and for a term of five years from and after
the date of the issuance of the patent or grant.

xxx

No alienation, transfer, or conveyance of any homestead after 5 years and before

twenty-five years after the issuance of title shall be valid without the approval of the
Secretary of Agriculture and Commerce, which approval shall not be denied except on
constitutional and legal grounds.

A grantee or homesteader is prohibited from alienating to a private individual

a land grant within five years from the time that the patent or grant is issued. A [29]

violation of this prohibition renders a sale void. This prohibition, however,

[30]

expires on the fifth year.From then on until the next 20 years the land grant
[31]

may be alienated provided the Secretary of Agriculture and Natural Resources

approves the alienation. The Secretary is required to approve the alienation
unless there are constitutional and legal grounds to deny the approval. In this
case, there are no apparent constitutional or legal grounds for the Secretary to
disapprove the sale of the Subject Land.
The failure to secure the approval of the Secretary does not ipso facto make
a sale void. The absence of approval by the Secretary does not nullify a sale
[32]

made after the expiration of the 5-year period, for in such event the requirement
of Section 118 of the Public Land Act becomes merely directory or a [33]

formality. The approval may be secured later, producing the effect of ratifying
[34]

and adopting the transaction as if the sale had been previously authorized. As [35]

held in Evangelista v. Montano: [36]

Section 118 of Commonwealth Act No. 141, as amended, specifically enjoins that the
approval by the Department Secretary "shall not be denied except on constitutional
and legal grounds." There being no allegation that there were constitutional or legal
impediments to the sales, and no pretense that if the sales had been submitted to the
Secretary concerned they would have been disapproved, approval was a ministerial
duty, to be had as a matter of course and demandable if refused. For this reason, and if
necessary, approval may now be applied for and its effect will be to ratify and adopt
the transactions as if they had been previously authorized. (Emphasis supplied)

Action Not Barred by Prescription and Laches

Petitioners insist that prescription and laches have set in. We disagree.
The Amended Complaint filed by Armando and Adelia with the trial court is
captioned as one for Specific Performance. In reality, the ultimate relief sought
by Armando and Adelia is the reconveyance to them of the Subject Land. An
action for reconveyance is one that seeks to transfer property, wrongfully
registered by another, to its rightful and legal owner. The body of the pleading
[37]

or complaint determines the nature of an action, not its title or heading. Thus, [38]

the present action should be treated as one for reconveyance. [39]

Article 1456 of the Civil Code provides that a person acquiring property
through fraud becomes by operation of law a trustee of an implied trust for the
benefit of the real owner of the property. The presence of fraud in this case
created an implied trust in favor of Armando and Adelia. This gives Armando
and Adelia the right to seek reconveyance of the property from the Subsequent
Buyers. [40]

To determine when the prescriptive period commenced in an action for

reconveyance, plaintiffs possession of the disputed property is material. An
action for reconveyance based on an implied trust prescribes in ten years. The [41]

ten-year prescriptive period applies only if there is an actual need to reconvey

the property as when the plaintiff is not in possession of the
property. However, if the plaintiff, as the real owner of the property also
[42]

remains in possession of the property, the prescriptive period to recover title

and possession of the property does not run against him. In such a case, an
[43]

action for reconveyance, if nonetheless filed, would be in the nature of a suit for
quieting of title, an action that is imprescriptible.[44]

In this case, the appellate court resolved the issue of prescription by ruling
that the action should prescribe four years from discovery of the fraud. We must
correct this erroneous application of the four-year prescriptive period. In Caro
v. Court of Appeals, we explained why an action for reconveyance based on
[45]

an implied trust should prescribe in ten years. In that case, the appellate court
also erroneously applied the four-year prescriptive period. We declared
in Caro:
We disagree. The case of Liwalug Amerol, et al. v. Molok Bagumbaran, G.R. No. L-
33261, September 30, 1987,154 SCRA 396 illuminated what used to be a gray area on
the prescriptive period for an action to reconvey the title to real property and,
corollarily, its point of reference:

xxx It must be remembered that before August 30, 1950, the date of the effectivity of
the new Civil Code, the old Code of Civil Procedure (Act No. 190) governed
prescription. It provided:

SEC. 43. Other civil actions; how limited.- Civil actions other than for the recovery of
real property can only be brought within the following periods after the right of action
accrues:

xxx xxx xxx

3. Within four years: xxx An action for relief on the ground of fraud, but the right of
action in such case shall not be deemed to have accrued until the discovery of the
fraud;

xxx xxx xxx

In contrast, under the present Civil Code, we find that just as an implied or
constructive trust is an offspring of the law (Art. 1456, Civil Code), so is the
corresponding obligation to reconvey the property and the title thereto in favor of the
true owner. In this context, and vis-a-vis prescription, Article 1144 of the Civil Code
is applicable.

Article 1144. The following actions must be brought within ten years from the time
the right of action accrues:

(1) Upon a written contract;

(2) Upon an obligation created by law;

(3) Upon a judgment.

xxxxxxxxx

(Emphasis supplied).

An action for reconveyance based on an implied or constructive trust must perforce

prescribe in ten years and not otherwise. A long line of decisions of this Court, and
of very recent vintage at that, illustrates this rule. Undoubtedly, it is now well-settled
that an action for reconveyance based on an implied or constructive trust prescribes
in ten years from the issuance of the Torrens title over the property. The only
discordant note, it seems, is Balbin vs. Medalla which states that the prescriptive
period for a reconveyance action is four years. However, this variance can be
explained by the erroneous reliance on Gerona vs. de Guzman. But in Gerona, the
fraud was discovered on June 25,1948, hence Section 43(3) of Act No. 190, was
applied, the new Civil Code not coming into effect until August 30, 1950 as
mentioned earlier. It must be stressed, at this juncture, that article 1144 and article
1456, are new provisions. They have no counterparts in the old Civil Code or in the
old Code of Civil Procedure, the latter being then resorted to as legal basis of the four-
year prescriptive period for an action for reconveyance of title of real property
acquired under false pretenses.

An action for reconveyance has its basis in Section 53, paragraph 3 of Presidential
Decree No. 1529, which provides:

In all cases of registration procured by fraud, the owner may pursue all his legal and
equitable remedies against the parties to such fraud without prejudice, however, to the
rights of any innocent holder of the decree of registration on the original petition or
application, xxx

This provision should be read in conjunction with Article 1456 of the Civil Code,
which provides:

Article 1456. If property is acquired through mistake or fraud, the person obtaining it
is, by force of law, considered a trustee of an implied trust for the benefit of the
person from whom the property comes.

The law thereby creates the obligation of the trustee to reconvey the property and the
title thereto in favor of the true owner. Correlating Section 53, paragraph 3 of
Presidential Decree No. 1529 and Article 1456 of the Civil Code with Article 1144(2)
of the Civil Code, supra, the prescriptive period for the reconveyance of fraudulently
registered real property is ten (10) years reckoned from the date of the issuance of the
certificate of title xxx (Emphasis supplied)[46]

Following Caro, we have consistently held that an action for reconveyance

based on an implied trust prescribes in ten years. We went further by
[47]

specifying the reference point of the ten-year prescriptive period as the date of
the registration of the deed or the issuance of the title. [48]

Had Armando and Adelia remained in possession of the Subject Land, their
action for reconveyance, in effect an action to quiet title to property, would not
be subject to prescription. Prescription does not run against the plaintiff in actual
possession of the disputed land because such plaintiff has a right to wait until
his possession is disturbed or his title is questioned before initiating an action
to vindicate his right. His undisturbed possession gives him the continuing
[49]

right to seek the aid of a court of equity to determine the nature of the adverse
claim of a third party and its effect on his title.
[50]

Armando and Adelia lost possession of the Subject Land when the
Subsequent Buyers forcibly drove away from the Subject Land the
Natanawans, the tenants of Armando and Adelia. This created an actual need
[51]

for Armando and Adelia to seek reconveyance of the Subject Land. The statute
of limitation becomes relevant in this case. The ten-year prescriptive period
started to run from the date the Subsequent Buyers registered their deeds of
sale with the Register of Deeds.
The Subsequent Buyers bought the subdivided portions of the Subject Land
on 22 February 1994, the date of execution of their deeds of sale. The Register
of Deeds issued the transfer certificates of title to the Subsequent Buyers on 24
February 1994. Armando and Adelia filed the Complaint on 7 March
1994. Clearly, prescription could not have set in since the case was filed at the
early stage of the ten-year prescriptive period.
Neither is the action barred by laches. We have defined laches as the failure
or neglect, for an unreasonable time, to do that which, by the exercise of due
diligence, could or should have been done earlier. It is negligence or omission
[52]

to assert a right within a reasonable time, warranting a presumption that the

party entitled to assert it either has abandoned it or declined to assert
it. Armando and Adelia discovered in January 1994 the subsequent sale of the
[53]

Subject Land and they filed this case on 7 March 1994. Plainly, Armando and
Adelia did not sleep on their rights.

Validity of Subsequent Sale of Portions of the Subject Land

Petitioners maintain that the subsequent sale must be upheld because the
Subsequent Buyers, the co-petitioners of Godofredo and Carmen, purchased
and registered the Subject Land in good faith. Petitioners argue that the
testimony of Calonso, the person who brokered the second sale, should not
prejudice the Subsequent Buyers. There is no evidence that Calonso was the
agent of the Subsequent Buyers and that she communicated to them what she
knew about the adverse claim and the prior sale. Petitioners assert that the
adverse claim registered by Armando and Adelia has no legal basis to render
defective the transfer of title to the Subsequent Buyers.
 We are not persuaded. Godofredo and Carmen had already sold the
Subject Land to Armando and Adelia. The settled rule is when ownership or title
passes to the buyer, the seller ceases to have any title to transfer to any third
person. If the seller sells the same land to another, the second buyer who has
[54]

actual or constructive knowledge of the prior sale cannot be a registrant in good

faith. Such second buyer cannot defeat the first buyers title. In case a title is
[55] [56]

issued to the second buyer, the first buyer may seek reconveyance of the
property subject of the sale. [57]

Thus, to merit protection under the second paragraph of Article 1544 of [58]

the Civil Code, the second buyer must act in good faith in registering the
deed. In this case, the Subsequent Buyers good faith hinges on whether they
[59]

had knowledge of the previous sale. Petitioners do not dispute that Armando
and Adelia registered their adverse claim with the Registry of Deeds of Bataan
on 8 February 1994. The Subsequent Buyers purchased their respective lots
only on 22 February 1994 as shown by the date of their deeds of
sale. Consequently, the adverse claim registered prior to the second sale
charged the Subsequent Buyers with constructive notice of the defect in the title
of the sellers, Godofredo and Carmen.
[60]

It is immaterial whether Calonso, the broker of the second sale,

communicated to the Subsequent Buyers the existence of the adverse claim.
The registration of the adverse claim on 8 February 1994 constituted, by
operation of law, notice to the whole world. From that date onwards, the
[61]

Subsequent Buyers were deemed to have constructive notice of the adverse

claim of Armando and Adelia. When the Subsequent Buyers purchased
portions of the Subject Land on 22 February 1994, they already had
constructive notice of the adverse claim registered earlier. Thus, the [62]

Subsequent Buyers were not buyers in good faith when they purchased their
lots on 22 February 1994. They were also not registrants in good faith when
they registered their deeds of sale with the Registry of Deeds on 24 February
1994.
The Subsequent Buyers individual titles to their respective lots are not
absolutely indefeasible. The defense of indefeasibility of the Torrens Title does
not extend to a transferee who takes the certificate of title with notice of a flaw
in his title. The principle of indefeasibility of title does not apply where fraud
[63]

attended the issuance of the titles as in this case. [64]

Attorneys Fees and Costs

 We sustain the award of attorneys fees. The decision of the court must state
the grounds for the award of attorneys fees. The trial court complied with this
requirement. We agree with the trial court that if it were not for petitioners
[65]

unjustified refusal to heed the just and valid demands of Armando and Adelia,
the latter would not have been compelled to file this action.
The Court of Appeals echoed the trial courts condemnation of petitioners
fraudulent maneuverings in securing the second sale of the Subject Land to the
Subsequent Buyers. We will also not turn a blind eye on petitioners brazen
tactics. Thus, we uphold the treble costs imposed by the Court of Appeals on
petitioners.
WHEREFORE, the petition is DENIED and the appealed decision is
AFFIRMED. Treble costs against petitioners.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Vitug, Ynares-Santiago, and Azcuna,
JJ., concur.

G.R. No. 168101 February 13, 2006

PEOPLE OF THE PHILIPPINES, Appellee,

vs.
GREGORIO CORPUZ Y ESPIRITU, Appellant.

DECISION

PER CURIAM:

We have before Us yet one more account of how a young girl, deprived of the attentions of a mother
gone to work in foreign shores, is attacked and betrayed by the one other person she should have
been able to depend on for solace, protection and love.

This is an appeal from the decision of the Regional Trial Court (RTC) dated 19 July 1999, Branch 08,
Aparri, Cagayan, in Criminal Case No. 08-974 finding the herein appellant, Gregorio Corpuz y
Espiritu, guilty beyond reasonable doubt of raping his 13-year-old daughter, Juvilie Corpuz y
Antonio, sentencing him to die by lethal injection, and ordering him to pay the victim ₱100,000.00 in
moral damages and ₱100,000.00 in exemplary damages.

The records of this case were originally transmitted to us on automatic review. However,
conformably with our Decision in People of the Philippines v. Efren Mateo y Garcia1 modifying
Sections 3 and 10 of Rule 122, Section 13 of Rule 124, Section 3 of Rule 125 of the Revised Rules
on Criminal Procedure and any other rule insofar as they provide for direct appeals from the RTC to
the Supreme Court in cases where the penalty imposed is death, reclusion perpetua or life
imprisonment, we referred the case and its records to the Court of Appeals2 for appropriate action
and disposition.

On 08 April 2005, the Court of Appeals rendered a Decision,3 the dispositive portion of which reads:
WHEREFORE, the Judgment dated 19 July 1999 of the Regional Trial Court, Second Judicial
Region, Branch 08, Aparri, Cagayan, in Criminal Case No. 08-974, finding accused-appellant
Gregorio Corpuz guilty beyond reasonable doubt of qualified rape and sentencing him to suffer the
DEATH penalty is hereby AFFIRMED with MODIFICATION in the sense that he is ordered to pay
the victim, Juvilie Corpuz, ₱75,000.00 as civil indemnity, ₱75,000.00 as moral damages, and
₱25,000.00 as exemplary damages.

The antecedent facts are as follows:

At the time of the incident, Juvilie, then 13, and her two sisters, Grace, aged 12, and Cheryl, aged 9,
were living with their father, herein appellant Gregorio Corpuz y Espiritu, in a two-bedroom bungalow
in Palagao, Gattaran, Cagayan. The girls’ mother had been working as a domestic helper in
Hongkong since May 1995.

Juvilie and her sister Grace used to sleep in one room, while the youngest sister Cheryl slept with
their father Gregorio in the other room. For two successive nights sometime prior to the night in
question, Juvilie felt somebody fondling her breast and caressing her private parts, even inserting a
forefinger inside her. On the second night, she caught her father doing it. She confronted him, but he
denied it, explaining that his presence in the room was allegedly to put arsenic rat poison.

On the night of 16 November 1996, Juvilie was awakened by a fist blow to her stomach. When she
reported the matter to her father, he claimed he had also been hit in his stomach, and advised her
and Grace to sleep in the other room with him and Cheryl, which they did the following night. Juvilie
laid down on one side of the mat while Gregorio laid on the other. Her sisters laid between them,
with Grace beside Juvilie and Cheryl beside Gregorio.

At around 11:00 in the evening of 17 November 1996, Juvilie was awakened by pain she felt in her
private parts. She felt and saw the shape of a man on top of her with his penis inside her. Her
panties had been removed, and her skirt raised. She pushed and hit the man, and shouted
"Okinnam bastos a laklakayan uleg, baboy" (Vulva of your mother, dirty old man, snake, pig)! The
man moved hurriedly to the other side of the mat and said "Pakawanennac anakko, tag-taginep ko
lang daydiay" (Forgive me my daughter, I was only dreaming).

Her two sisters, awakened by the shout, ran out of the room in fear. Juvilie was left inside the room
crying. Her father prevented her from leaving the room, saying "padasen iti rumuar ta adda
mapasama kenca" (try to go outside and something will happen to you). He also threatened her with
harm if she told anyone what had happened.

Juvilie’s shout had also been heard by her uncles, Rogelio and Walter Antonio, brothers of her
mother, whose houses were only about ten meters away from Juvilie’s. They immediately went to
Juvilie’s house, but hearing nothing further to arouse their suspicions, they went back to their own
homes.

In the afternoon of the following day, Juvilie slipped out of her house while Gregorio was cooking
and told Rogelio what her father had done to her. Rogelio reported the matter to their barangay
captain, who advised him to inform the police. Since Gregorio was almost constantly with Juvilie, it
was only on 27 November 1996 that she was able to report the rape to the police, where she
executed a sworn statement.

Juvilie was examined by Dr. Nida Rosales, the Municipal Health Officer of Gattaran, Cagayan. Dr.
Rosales observed one completely healed and two incompletely healed lacerations in Juvilie’s
hymen. The doctor also noted that Juvilie’s vagina admitted one finger with ease. When asked for
the possible cause of the lacerations, she replied that a hard object, such as an erect penis, could
have caused the said lacerations.4

On 20 March 1997, on the basis of a complaint filed by Juvilie Corpuz y Antonio, an Information5 was
filed before the RTC, Branch 08, Aparri, Cagayan, docketed as Criminal Case No. 08-974, charging
the herein appellant with the crime of qualified rape, thus:

That on or about November 17, 1996, in the municipality of Gattaran, province of Cagayan, and
within the jurisdiction of this Honorable Court, the above-named accused, being then the father
(parent) of the offended party, with lewd design, and by the use of force and intimidation, did then
and there willfully, unlawfully and feloniously have carnal knowledge of said Juvilie Corpuz y
Antonio, a woman under eighteen (18) years of age, all against her will and consent.

On 21 May 1997, the accused-appellant, with the assistance of counsel de oficio, pleaded "Not
Guilty" to the crime charged.6 Trial thereafter proceeded.

The prosecution presented four witnesses: Rogelio and Walter Antonio, Dr. Rosales, and the private
complainant herself.

The defense presented the lone testimony of Gregorio. On the stand, he claimed that he loved his
children very much. He alleged that on the night of 17 November 1996, he pushed Juvilie’s leg hard
against the wall, which was why she woke up and shouted. Thereafter, the case was submitted for
decision.

On 25 June 1999, the trial court issued an order7 stating:

The Presiding Judge was in the process of preparing a decision when he noticed that there is
variance between the offense charged and that proved.

In order to avoid the miscarriage of justice, the Trial Prosecutor is hereby directed to amend the
Information to conform with the evidence, specifically, that the rape was committed while the woman
is unconscious instead of by the use of force and intimidation. He is directed to do so within ten (10)
days.

Thus, on 13 July 1999, the prosecutor filed the following Amended Information:8

That on or about November 17, 1996, in the municipality of Gattaran, province of Cagayan, and
within the jurisdiction of this Honorable Court, the above-named accused, being then the father
(parent) of the offended party, with lewd design, and while the offended party was asleep and
unconscious, did then and there willfully, unlawfully and feloniously have carnal knowledge of said
Juvilie Corpuz y Antonio, a woman under eighteen (18) years of age, all against her will and
consent.

On 05 August 1999, the trial court promulgated the decision finding the accused-appellant guilty
beyond reasonable doubt of the crime of rape.9 In giving credence to the evidence adduced by the
prosecution, it explained thus:

It has been truly said that rape is so easy to charge and so difficult to defend. The logic is not quite
difficult to apprehend. It is usually committed when nobody is present to witness the same. However,
Filipino culture attaches an indelible stigma to the reputation of one who has been raped. An
accusation for rape is thus not made with indifference, but with much deliberation, usually only after
consultation with relatives and the family council.

"Art. 335. When and how rape is committed. – Rape is committed by having carnal knowledge of a
woman under any of the following circumstances.

"1. By using force or intimidation;

"2. When the woman is deprived of reason or otherwise unconscious; and

"3. When the woman is under twelve years of age or is demented.

xxxx

"The death penalty shall be imposed if the crime of rape is committed with any of the following
attendant circumstances:

"1. When the victim is under eighteen (18) years of age and the offender is a parent, ascendant,
step-parent, sanguinity or affinity within the third civil degree, or the common-law spouse of the
parent of the victim x x x.

The elements are carnal knowledge thru force or intimidation, when the woman is deprived of reason
or unconscious, or when the woman is under 12 or demented.

We are satisfied that there was carnal knowledge by accused of private complainant while the latter
was asleep on 17 November 1996. This is corroborated by finding of prosecution witness Dr. Nida
Nolasco-Rosales, Municipal Health Officer of Gattaran Town, Gattaran, Cagayan who conducted a
physical examination of the complainant Juvilie Corpuz on 28 November 1996. Her findings viz:

"Incomplete healed laceration at 2:00 [o’clock] position

"Complete healed laceration at 6:00 [o’clock] position

"Incomplete healed laceration at 9:00 [o’clock] position

"Genitalia admits one finger with ease"

On the witness box, on questioning by the Court, she testified that on 17 November 1996 witness-
complainant did not yet have a boyfriend. The testimony of her maternal uncles Rogelio and Walter
Antonio partly corroborates complainant’s testimony. Both uncles testified hearing complainant cry
on the evening of 17 November 1996 when the rape happened.

Accused himself when testifying admitted that on that evening, complainant cried when he pushed
her legs hard, which hit the wall. His reason for pushing – that complainant’s legs touched his in their
sleep is incredible considering that the former and the latter were at extreme ends of the mat with
Cheryl and Grace between them. While accused testified that complainant moves in her sleep, that
is not a sufficient explanation why he had to push her legs hard causing her to cry. Further, accused
did not deny that complainant uttered the words "ukinam, bastos a laklakayan, uleg, baboy" during
the incident when she discovered it was her father who was on top of her. On that occasion he said
"Pakawanennac anakko, tag-taginep ko lang daydiay" (meaning "forgive me my daughter, I was only
dreaming". Accused did not explain this.
Sleep is akin to "unconscious (ness)". It falls within its ambit.

Complainant is accused’s daughter. She was barely 13 years old on 17 November 1996. Accused
did not deny that complainant (his daughter) was aged 13.10

In his brief, the appellant assigns the following errors:

I.

THE COURT A QUO GRAVELY ERRED IN FINDING THAT THE GUILT OF THE
ACCUSED-APPELLANT FOR THE CRIME CHARGED HAS BEEN PROVEN BEYOND
REASONABLE DOUBT DESPITE THE PRIVATE COMPLAINANT’S HIGHLY DOUBTFUL
POSITIVE IDENTIFICATION OF HER ALLEGED ABUSER.

II.

THE COURT A QUO ERRED IN ORDERING THE AMENDMENT OF THE INFORMATION

TO CONFORM TO THE EVIDENCE ADDUCED BY THE PROSECUTION

In assailing Juvilie’s credibility, the appellant claims that since the rape of Juvilie took place inside
the bedroom with the lights switched off, and Juvilie was initially asleep when she was violated, it
was extremely unlikely that she was able to identify her assailant.

The Court of Appeals correctly disposed of the appellant’s arguments.

The pernicious consequences to both accused and offended party require that utmost care be taken
in the review of a decision involving conviction of rape.11 In such cases, we are guided by three
principles: (1) an accusation for rape can be made with facility; it is difficult to prove but more difficult
for the accused, though innocent, to disprove; (2) in view of the intrinsic nature of the crime of rape
where only two persons are usually involved, the testimony of the complainant must be scrutinized
with extreme caution; and (3) the evidence for the prosecution must stand or fall on its own merits,
and cannot be allowed to draw strength from the weakness of the evidence for the defense.12

In rape cases, the accused may be convicted solely on the basis of the testimony of the victim,
provided that such testimony is credible, natural, convincing and consistent with human nature and
the normal course of things.13

If her testimony meets the test of credibility, such is sufficient to convict the accused. The credibility
of the victim is almost always the single most important issue to hurdle. In this regard, the trial judge
is in the best position to assess the credibility of the complainant, having personally heard her and
observed her deportment and manner of testifying during the trial. Absent any showing that the trial
judge overlooked, misunderstood, or misapplied some facts or circumstances of weight which would
affect the result of the case, or that the judge acted arbitrarily, the trial judge’s assessment of
credibility deserves the appellate court’s highest respect.14

Here, the Court of Appeals agreed in the trial judge’s assessment of Juvilie’s credibility, and
observed that she was direct, unequivocal, convincing and consistent in answering the questions
propounded to her. We concur.

Juvilie testified as follows:

Q - Now, while you were there inside the room of your father on November 17, 1996, at around
11:00 o’clock was there anything unusual that took place?

A - There was, Your Honor.

Q - What was the incident?

A - My father raised my dress and removed my panty, and went on top of me.

Q - What kind of dress [were] you wearing?

A - Skirt, Your Honor.

Q - What about the other?

A - T-shirt, Your Honor.

Q - And you said your father removed your panty?

A - Yes, Your Honor.

Q - Did you already know that your panty was remove[d] and your shirt was raised, do you know
who removed them?

A - Not yet, Your Honor.

Q - And after that, what did you do when your t-shirt was raised and your panty was removed?

A - I pushed him, and boxed him for several times and grabbed him, Your Honor.

Q - Did you already know that was your father?

A - Not yet, Your Honor.

Q - Was the light close[d]?

A - Yes, Your Honor.

Q - What about your two sisters, what were they doing?

A - They were still sleeping, Your Honor.

xxxx

Fiscal Cortes:

Q - Aside from removing panty, what else did your fater do?

A - I felt his penish (sic) penetrated, sir.

Court:

Q - Were you asleep when your t-shirt was raised and your panty was removed?

A - Yes, Your Honor.

Q - And were you still asleep when you felt something inside your genital?

A - Yes, Your Honor.

Q - And then what did you do after that?

A - I felt pain and I pushed him sir, for several times and I even shouted the words "Ukinam bastos a
laklakayan uleg, baboy."

Q - When you felt pain, you pushed the one on top of you, you boxed him, you grabbed him, why do
you know already who it was?

A - Yes, Your Honor.

Q - That was when you shouted?

A - Yes, Your Honor.

Q - Were you already awake when somebody raised your skirt?

A - Not yet, Your Honor.

Q - When somebody removed your panty you [were] awake?

A - Not yet, Your Honor.

Fiscal Cortes:

Q - When your father inserted his penish (sic) to your vagina were you already awake?

A - Yes, sir.

Court:

Q - Can you recall what particular sensation awake you?

A - Yes, sir.

Q - Why?

A - When I felt pain that awakened me.

xxxx
Fiscal Cortes:

xxxx

Q - How did you know that it was your father when according to you the light was off?

A - Because my father uttered the word[s] "pakawanen nak anakko tagtaglinep ko lang daydiay"
which means forgive me my daughter I was only dreaming.

Court:

Q - When your father asked you for forgiveness was his pants on?

A - I do not know, Your Honor, because it was still dark at that time.

Q - But he was no longer on top of you?

A - No more, Your Honor.

Court: Continue.

Fiscal Cortes:

Q - Where was your father then when he uttered those words?

A - He was beside of (sic) Cheryl, sir.

Q - When you woke up because of the pain, [were] your two sisters also awoke or were they still
sleeping?

A - Yes, sir.

Q - After your father went to the side of your sister Cheryl, what happened next?

A - My two sisters went outside the room because they were frightened, sir.

Court:

Q - How about you?

A - I stayed in the bedroom, Your Honor.

Q - With your father?

A - Yes, Your Honor.

Q - And what happened after that?

A - When my two sisters were already outside the room and I was also inside the room and my
father threatened me if I will report I will also die.15
The testimony of child-victims are normally given full weight and credit, since when a woman, more
so if she is a minor, says that she has been raped, she says in effect all that is necessary to show
that rape was committed. Youth and immaturity are generally badges of truth and sincerity. No
woman, least of all a child, would concoct a story of defloration, allow an examination of her private
parts and subject herself to public trial or ridicule if she has not, in truth, been a victim of rape and
impelled to seek justice for the wrong done to her.16

Moreover, Juvilie’s testimony is corroborated by the medical findings of the examining physician.
Where a victim’s testimony is corroborated by the physical findings of penetration, there is sufficient
basis for concluding that sexual intercourse did take place. A rape victim’s account is sufficient to
support a conviction for rape if it is straightforward, candid and corroborated by the medical findings
of the examining physician,17 as in the present case.

We come now to the accused-appellant’s claim that the prosecution failed to establish the identity of
the perpetrator with certitude since the room was dark and it was not shown to have been properly
illuminated.

It is highly inconceivable that complainant would not recognize her own father, with whom she had
been living for a long time. We have held that it is the most natural reaction for victims of criminal
violence to strive to see the appearance of their assailant and observe the manner in which the
crime was committed. Most often, the face and body movements of the assailants create a lasting
impression which cannot be easily erased from their memory.18The impression becomes more
profound where the malefactor is the victim's own father.19 Also, Juvilie categorically testified that it
was her father who raped her. It is unthinkable, if not completely preposterous, that a daughter
would concoct a story of rape against her father, taking to mind the reverence and respect for elders
that is too deeply ingrained in Filipino children.20 It is well-settled that a categorical and positive
identification of an accused, without any showing of ill-motive on the part of the eyewitness testifying
on the matter, prevails over alibi and denial, which are negative and self-serving evidence
undeserving of real weight in law unless substantiated by clear and convincing evidence.21

Juvilie was also able to identify her abuser through his voice. As efficiently summed up by the Court
of Appeals:

On the night of 17 November 1996, Juvilie was awakened by the pain she felt when her abuser
inserted his penis inside her vagina. Upon waking and finding a man on top of her, she repeatedly
pushed and hit her assailant. She shouted at him, "ukinam bastos a laklakayan uleg, baboy."

The man laying on top of her hastily moved to the other side of the mat from where Juvilie slept. He
then uttered, "pakawanen nak anako tagtaginep ko lang daydiay." She recognized his voice as that
of her father.

Identification of an accused by his voice has been accepted particularly in cases where, such as in
this case, the witness has known the malefactor personally for so long and so intimately. In People
v. Calixto, the Supreme Court has given credence to the blindfolded rape victim’s identification of the
accused, a barriomate, by his voice. Also, in an earlier case, the Supreme Court has said:

"x x x [C]omplainant’s identification of the appellant was not based solely on the latter’s physical
defect, but by his voice as well, when he warned complainant, ‘Flor, keep quiet.’ Although
complainant did not see appellant’s face during the sexual act because the house was dark,
nevertheless, no error could have been committed by the complainant in identifying the voice of the
accused, inasmuch as complainant were neighbors."
Pitted against the positive, straightforward and unequivocal testimony of the victim – Juvilie – the
mere denial by the accused-appellant that he raped his daughter cannot prevail.

Denial is inherently a weak defense. It cannot prevail over positive identifications, unless buttressed
by strong evidence of non-culpability. Denials are self-serving negative by strong evidence which
cannot prevail over the positive, straightforward and unequivocal testimony of the victim. When the
offended parties are young and immature girls from the ages of twelve to sixteen, courts are inclined
to lend credence to their version of what transpired, considering not only their relative vulnerability
but also the shame and embarrassment to which they would be exposed by court trial if the matter
about which they testified is not true.

The accused-appellant next contends that the trial court’s order to amend the information as to the
mode of commission of the rape – from "by force and intimidation" to "while the offended party was
asleep or unconscious" – is not sanctioned by the Rules on Criminal Procedure.

However, this issue has already been directly addressed in People v. Abiera,22 and later in People v.
Atienza,23where we upheld the conviction for rape committed under one mode when the information
alleged another.

In Atienza, therein accused-appellant contended that the trial court erred in finding him guilty of rape
under par. (2), Art, 335, i.e., rape of a woman who was deprived of reason, including those with the
mental capacity of a child below twelve (12) years old, when the Information charged him with rape
committed through force and intimidation as defined in par. (1), Art. 335. Atienza cited the earlier
case of Abiera, wherein we held thus:

The appellant maintains that he cannot be convicted of rape committed under one mode when the
information alleged another mode. He cites the case of People v. Pailano, where this Court held that
to convict the appellant on the finding that he had committed rape while the victim was unconscious
or otherwise deprived of reason — and not through force and intimidation, which was the method
alleged — would violate his constitutional right to be informed of the nature and cause of the
accusation against him.

That case works against the appellant. In Pailano, this Court impliedly recognized that an accused
charged with rape through one mode of commission may still be convicted of the crime if the
evidence shows another mode of commission provided that the accused did not object to such
evidence. The Court said:

It may be argued that although initially deficient, the criminal complaint was deemed corrected when
the prosecution introduced evidence on the complainant's mental condition and the defense did not
object, thereby waiving the procedural defect. Even so, the charge has not been adequately
established.

The prosecution presented evidence to show that Abiera had carnal knowledge of the complainant
when by means of force, violence and intimidation, he boxed her in the stomach, causing her to lose
consciousness, after which he violated her. When Alma regained consciousness, the outrage had
already been committed. Her deshabille, her bleeding vagina, the near-naked man beside her — all
these reasonably indicated that Abiera had deflowered Alma while she was unconscious. The
defense did not object to the presentation of evidence to establish all these circumstances.

The Pailano case is different from the case at bar because it has been proven that Abiera had carnal
knowledge of Alma after rendering her unconscious. Pailano was acquitted because it was not
established that he used force and intimidation upon the complainant or that the girl was mentally
deficient.24

In the case at bar, the appellant never raised any objection when the prosecution showed another
mode of commission of the crime charged as alleged in the original information. Nor did he interpose
any objections after the judge issued his order of 25 June 1999 directing the trial prosecutor to
amend the information to conform with the evidence and before he rendered judgment.

Be that as it may, the amendment of the information did not affect the crime committed by the
appellant, that is, qualified rape. In cases of incestuous rape, force or intimidation need not even be
proven. The overpowering moral influence of the father over the daughter takes the place of violence
and offer of resistance required in rape cases committed by an accused unrelated to the
victim.25 Consequently, his conviction is in order.

Having determined that rape was indeed committed by Gregorio against Juvilie, we come now to the
question of the appropriate imposable penalty under the circumstances.

The death penalty is imposed if the crime of rape is committed with the attendance of certain
circumstances, one of these being when the victim is under eighteen years of age and the offender
is a parent, ascendant, stepparent, guardian, relative by consanguinity and affinity within the third
civil degree, or the common-law spouse of the parent of the victim.

Gregorio’s paternity was alleged in the information and duly proven in the course of the trial. He was
duly identified as such by Rogelio Antonio,26 Juvilie’s maternal uncle and close neighbor, by Juvilie
herself,27 and admitted by the appellant during direct examination.28

Juvelie’s minority was also alleged in the information and duly proven during trial, in the course of
which her birth certificate was offered in evidence.29 Appellant himself also expressly and clearly
testified as to her age under direct examination.30

We have consistently held that the concurrence of the minority of the victim and her relationship to
the offender is a special qualifying circumstance which increases the penalty, and must be properly
alleged in the information because of the accused’s right to be informed of the nature and cause of
the accusation against him.31 Juvilie’s minority and her relationship with Gregorio having been duly
established by evidence, the death penalty was correctly imposed upon the appellant.

WHEREFORE, the Decision of the Court of Appeals of 08 April 2005 affirming the Decision dated 19
July 1999 of the Regional Trial Court, Branch 08, Aparri, Cagayan in Criminal Case No. 08-974,
finding accused-appellant Gregorio Corpuz guilty beyond reasonable doubt of qualified rape and
sentencing him to suffer the DEATH penalty with the MODIFICATION that he is ordered to pay the
victim, Juvilie Corpuz, ₱75,000.00 as civil indemnity, ₱75,000.00 as moral damages, and
₱25,000.00 as exemplary damages, is hereby AFFIRMED.32

In accordance with Article 83 of the Revised Penal Code, as amended by Section 25 of Republic Act
7659, upon finality of this Decision, let the records of this case be forwarded forthwith to the Office of
the President for possible exercise of executive clemency.

SO ORDERED.

SECOND DIVISION
 [G.R. No. 127473. December 8, 2003]

PHILIPPINE AIRLINES, INC., petitioner, vs. COURT OF APPEALS, JUDY

AMOR, JANE GAMIL, minors GIAN CARLO AMOR represented by
ATTY. OWEN AMOR, and CARLO BENITEZ represented by
JOSEPHINE BENITEZ, respondents.

DECISION
AUSTRIA-MARTINEZ, J.:

Before us is a petition for review on certiorari under Rule 45 of the Rules of

Court seeking the reversal of the decision dated August 12, 1996, in CA-G.R.
[1]

CV No. 38327 and the Resolution dated November 15, 1996 denying the
[2]

motion for reconsideration of Philippine Airlines, Inc. (petitioner for brevity).

Private respondents Judy Amor, Jane Gamil, minor Gian Carlo Amor,
represented by his father, Atty. Owen Amor, and, minor Carlo Benitez,
represented by his mother, Josephine Benitez, filed with the Regional Trial
Court (Branch 53), Sorsogon, Sorsogon, a complaint for damages against
[3]

petitioner due to the latters failure to honor their confirmed tickets.

In support of their claim, private respondents presented evidence
establishing the following facts:
Private respondent Judy Amor purchased three confirmed plane tickets for
her and her infant son, Gian Carlo Amor as well as her sister Jane Gamil for
the May 8, 1988, 7:10 a.m. flight, PR 178, bound for Manila from defendants
branch office in Legaspi City.Judy Amor, a dentist and a member of the Board
of Directors of the Sorsogon Dental Association, was scheduled to attend the
National Convention of the Philippine Dental Association from May 8 to 14,
1988 at the Philippine International Convention Center. [4]

On May 8, 1988, Judy with Gian, Jane and minor Carlo Benitez, nephew of
Judy and Jane, arrived at the Legaspi Airport at 6:20 a.m. for PR 178. Carlo
Benitez was supposed to use the confirmed ticket of a certain Dra. Emily
Chua. They were accompanied by Atty. Owen Amor and the latters cousin,
[5]

Salvador Gonzales who fell in line at the check-in counter with four persons
ahead of him and three persons behind him while plaintiff Judy went to the
[6]

office of the station manager to request that minor plaintiff Carlo Benitez be
allowed to use the ticket of Dra. Chua. While waiting for his turn, Gonzales was
[7]

asked by Lloyd Fojas, the check-in clerk on duty, to approach the

counter. Fojas wrote something on the tickets which Gonzales later read as late
check-in 7:05. When Gonzales turn came, Fojas gave him the tickets of private
respondents Judy, Jane and Gian and told him to proceed to the cashier to
make arrangements. [8]

Salvador then went to Atty. Amor and told him about the
situation. Atty. Amor pleaded with Fojas, pointing out that it is only 6:45 a.m.,
but the latter did not even look at him or utter any word. Atty. Amor then tried to
plead with Delfin Canonizado and George Carranza, employees of petitioner,
but still to no avail. Private respondents were not able to board said flight. The
plane left at 7:30 a.m., twenty minutes behind the original schedule. [9]

Private respondents went to the bus terminals hoping to catch a ride

for Manila. Finding none, they went back to the airport and tried to catch an
afternoon flight. Unfortunately, the 2:30 p.m. flight, PR 278, was cancelled due
[10]

to aircraft situation. Private respondents were told to wait for the 5:30
[11]

p.m. flight, PR 180. They checked-in their bags and were told to hand in their
tickets. Later, a PAL employee at the check-in counter called out the name of
private respondent minor Carlo Benitez. Plaintiff Judy approached the counter
and was told by the PAL personnel that they cannot be
accommodated. Fojas who was also at the counter then removed the boarding
passes inserted in private respondents tickets as well as the tags from
their luggages.[12]

Manuel Baltazar, a former Acting Manager of petitioner in Legaspi City in

May 1988, testified that based on his investigation, the private respondents,
although confirmed passengers, were not able to board PR 178 in the morning
of May 8, 1988 because there were go-show or waitlisted and non-revenue
passengers who were accommodated in said flight. He also noted that there
was overbooking for PR 178. [13]

On the other hand, petitioner contends that private respondents are not
entitled to their claim for damages because they were late in checking-in for PR
178; and that they were only chance or waitlisted passengers for PR 180 and
were not accommodated because all confirmed passengers of the flight had
checked-in. In support thereof, petitioner presented Lloyd Fojas, who testified,
as follows:
In the morning of May 8, 1988, he was on duty at the check-in counter of
the Legaspi Airport. He was the one who attended to the tickets of private
respondents which were tendered by Salvador Gonzales at 7:05 a.m. when the
counter was already closed. The clock at the check-in counter showed that it
was already 7:05 and so he told Gonzales that they are already late and wrote
late check-in, 7:05 on private respondents tickets. The flight was scheduled to
leave at 7:10 a.m. and checking-in is allowed only until 30 minutes before
departure time. At the time private respondents went to the check-in counter,
passengers were already leaving the pre-departure area and going towards the
plane and there were no more passengers in the check-in area, not even
waitlisted passengers. The baggages of the passengers have been loaded in
the aircraft. Gonzales left and later came back with Atty. Amor who pleaded that
plaintiffs be accommodated in the flight. He told Atty. Amor to go to his
supervisor to re-book the tickets because there were no more boarding passes
and it was already time for boarding the plane. Atty. Amor then left the
counter.[14]

On cross-examination, Fojas testified that he did not know how many

waitlisted or non-revenue passengers were accommodated or issued boarding
passes in the 7:00 a. m. and in the afternoon flight of May 8, 1988. [15]

After trial, the RTC rendered judgment upholding the evidence presented
by private respondents, the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered:

(a) ordering the defendant to reimburse the plaintiffs the amount of P1,171.60
representing the purchase price of the four (4) plane tickets;

(b) condemning the defendant to pay plaintiffs Judy Amor and Jane Gamil the
amount of P250,000.00 each as moral damages, P200,000.00 as
exemplary damages, plus P100,000.00 as actual damages;

(c) for the defendant to pay plaintiffs the amount of P30,000.00 as attorneys
fees, plus P500.00 for every appearance, or a total of P10,500.00 for 21
actual appearance (sic) in court, P2,000.00 as incidental litigation
expenses, and to pay the cost of the suit.

SO ORDERED. [16]

Aggrieved, petitioner appealed to the Court of Appeals (CA for brevity)

which affirmed the judgment of the trial court in toto and denied petitioners
motion for reconsideration.
Hence, the present petition of PAL, raising the following issues:
I

WHETHER PRIVATE RESPONDENTS WERE LATE CHECKED-IN

PASSENGERS AND WHETHER THE FAILURE OF AN AIRLINE TO
ACCOMMODATE A PASSENGER WHO CHECKED IN LATE IS ACTIONABLE
SO AS TO ENTITLE THEM TO DAMAGES.

II

ASSUMING ARGUENDO THAT PETITIONER IS LIABLE, WHETHER THE

AMOUNT OF DAMAGES AWARDED TO PRIVATE RESPONDENTS IS
EXCESSIVE, UNCONSCIONABLE AND UNREASONABLE. [17]

In support of the first issue, petitioner argues:

(1) While ordinarily, the findings of the CA are accepted as conclusive by
this Court, there are instances when the Court may make its own findings such
as when the appellate court based its findings on speculation, surmises or
conjectures. The appellate court erroneously gave too much reliance on the
testimony of Baltazar who is a disgruntled former employee and relative of
private respondent Amor. He was not present at the time of the
incident. Baltazar merely interpreted the flight manifest and made a lot of
speculations which is undeserving of attention and merit.
(2) Its employees are adequately trained and service oriented that they
would not dare violate company rules and regulations. They are aware of the
drastic consequences that may befall them as what happened to Baltazar.
(3) As to PR 180, private respondents were merely waitlisted in said flight
hence it was known to them that their accommodation in said flight was
dependent upon the failure of any confirmed passenger to check-in within the
regulation check-in time. Unfortunately for them, all the confirmed passengers
on PR 180 checked-in on time.
In support of the second issue, petitioner contends:
(1) The award of actual, moral and exemplary damages to private
respondents have no factual nor legal basis at all. Its failure to accommodate
private respondents on Flights PR 178, 278 and 180 was not motivated by bad
faith or malice but due to a situation which private respondents brought upon
themselves. It had exerted utmost and sincere effort to lessen the agony and
predicament of private respondents. They immediately made protective
bookings for private respondents on the 2:30 p.m. flight, PR 278, which
unfortunately was cancelled due to aircraft situation. Upon cancellation of PR
278, they made special arrangements to enable private respondents to have
first priority in PR 180 in case of a no show confirmed passenger.
 (2) To award damages to a passenger who checked-in late would place a
premium or reward for breach of contract that would encourage passengers to
intentionally check-in late with the expectation of an award of damages.
(3) Moral and exemplary damages as well as attorneys fees are not
recoverable in damage suits predicated on breach of contract of carriage unless
there is evidence of fraud, malice or bad faith on the part of the carrier. Even
assuming arguendo that petitioner is liable for damages, the amounts awarded
in favor of private respondents are excessive, unreasonable and
unconscionable. The primary object of an award of damages in a civil action is
compensation or indemnity or to repair the wrong that has been done. Damages
awarded should be equal to, and commensurate with, the injury sustained.
(4) It was erroneous to award damages in favor of Jane Gamil when she
never appeared before the trial court to prove her claim for damages.
In their Comment, private respondents stress that the fact they were not late
in checking-in for PR 178 has been substantially established in the hearing
before the trial court and affirmed by the CA. They maintain that, contrary to the
assertion of petitioner, they have established their case not only by a
preponderance of evidence but by proof that is more than what is required by
law justifying the factual findings of the trial court and the CA.
Private respondents point out that since the issues raised by this petition
are factual and do not fall under exceptional circumstances, there is nothing left
to be reviewed or examined by the Supreme Court.
As to the damages awarded, private respondents contend that the amounts
awarded are not excessive, unconscionable or unreasonable because of the
high-handed, malicious, dictatorial and savage act of petitioners employee
which caused them untold mental anguish, excruciating pain, public contempt
and ridicule, sleepless nights and other forms of moral suffering.
In its Reply, petitioner reiterates its earlier points and questions once more
the credibility of private respondents witnesses, particularly Atty. Owen Amor,
Salvador Gonzales and Manuel Baltazar who are related to the respondents by
blood or affinity.
In their Rejoinder, private respondents aver that the findings of facts of the
courts a quo were based not only on the testimonies of their witnesses but also
on petitioners own employee, Lloyd Fojas, who testified that there were non-
revenue, go-show and waitlisted passengers who were accommodated in PR
178. They reiterate their position that where there is a question regarding the
credibility of witnesses, the findings of trial courts are generally not disturbed by
appellate courts. Finally, as to the damages awarded, private respondents
claim that there was substantial basis in awarding such amounts.
Evidently, in resolving the two issues raised in the present petition, it is
inevitable and most crucial that we first determine the question whether or not
the CA erred in upholding the RTC ruling that private respondents were late in
checking-in. Both issues call for a review of the factual findings of the lower
courts.
In petitions for review on certiorari under Rule 45 of the Rules of Court, the
general rule is that only questions of law may be raised by the parties and
passed upon by this Court. Factual findings of the appellate court are
[18]

generally binding on us especially when in complete accord with the findings of

the trial court. This is because it is not our function to analyze or weigh the
[19]

evidence all over again. However, this general rule admits of exceptions, to
[20]

wit:

(a) where there is grave abuse of discretion; (b) when the finding is grounded entirely
on speculations, surmises or conjectures; (c) when the inference made is manifestly
mistaken, absurd or impossible; (d) when the judgment of the Court of Appeals was
based on a misapprehension of facts; (e) when the factual findings are conflicting; (f)
when the Court of Appeals, in making its findings, went beyond the issues of the case
and the same are contrary to the admissions of both appellant and appellee; (g) when
the Court of Appeals manifestly overlooked certain relevant facts not disputed by the
parties and which, if properly considered, would justify a different conclusion; and,
(h) where the findings of fact of the Court of Appeals are contrary to those of the trial
court, or are mere conclusions without citation of specific evidence, or where the facts
set forth by the petitioner are not disputed by the respondent, or where the findings of
fact of the Court of Appeals are premised on the absence of evidence and are
contradicted by the evidence on record. [21]

Petitioner invokes exception (b).

As to the first issue: Whether or not private respondents checked-in on time
for PR 178. The determination of this issue is necessary because it is expressly
stipulated in the airline tickets issued to private respondents that PAL will
consider the reserved seat cancelled if the passenger fails to check-in at least
thirty minutes before the published departure time. [22]

After a careful review of the records, we find no reason to disturb

the affirmance by the CA of the findings of the trial court that the private
respondents have checked-in on time; that they reached the airport at 6:20
a.m., based on the testimonies of private respondent Judy Amor, and witnesses
Salvador Gonzales and Atty. Owen Amor who were consistent in their
declarations on the witness stand and corroborated one anothers statements;
and that the testimony of petitioners lone witness, Lloyd Fojas is not sufficient
to overcome private respondents evidence.
We have repeatedly held that the truth is established not by the number of
witnesses but by the quality of their testimonies. In the present case, it cannot
[23]

be said that the quality of the testimony of petitioners lone witness is greater
than those of the private respondents. Fojas testified that when respondents
went to the check-in counter, there were no more persons in that area
since all the passengers already boarded the plane. However, the testimonies
[24]

of Manuel Baltazar and Judy Amor together with the manifest, Exhibits E, E-1
and E-2, point to the fact that many passengers were not able to board said
flight, including confirmed passengers, because of overbooking. [25]

It is a well-entrenched principle that absent any showing of grave abuse of

discretion or any palpable error in its findings, this Court will not question the
probative weight accorded by the lower courts to the various evidence
presented by the parties. As we explained in Superlines Transportation Co.
Inc., vs. ICC Leasing & Financing Corporation: [26]

The Court is not tasked to calibrate and assess the probative weight of evidence
adduced by the parties during trial all over againSo long as the findings of facts of the
Court of Appeals are consistent with or are not palpably contrary to the evidence on
record, this Court shall decline to embark on a review on the probative weight of the
evidence of the parties. (Emphasis supplied)
[27]

It is also well established that findings of trial courts on the credibility of

witnesses is entitled to great respect and will not be disturbed on appeal except
on very strong and cogent grounds. Petitioner failed to demonstrate that the
[28]

trial court committed any error in upholding the testimonies of private

respondents witnesses. We find that the CA committed no reversible error in
sustaining the findings of facts of the trial court.
Private respondents who had confirmed tickets for PR 178 were bumped-
off in favor of non-revenue passengers. Witness Manuel Baltazar, a former
Acting Manager of petitioner, evaluated the manifest for PR 178 and found that
there were non-revenue passengers allowed to go on board. He specifically
identified the family of Labanda, a certain Mr. Luz, petitioners former branch
manager, and, a certain Mr. Moyo. Although petitioner had every opportunity
[29]

to refute such testimony, it failed to present any countervailing

evidence. Instead, petitioner merely focused on assailing the credibility
of Baltazar on the ground that he was a disgruntled employee and a relative of
private respondents. Apart from the bare allegations in petitioners pleadings,
no evidence was ever presented in court to substantiate its claim
that Baltazar was a disgruntled employee that impelled him to testify against
petitioner.
As to his relationship with private respondents, this Court has repeatedly
held that a witness relationship to the victim does not automatically affect the
veracity of his or her testimony. While this principle is often applied in criminal
[30]

cases, we deem that the same principle may apply in this case, albeit civil in
nature. If a witness relationship with a party does not ipso facto render him a
biased witness in criminal cases where the quantum of evidence required is
proof beyond reasonable doubt, there is no reason why the same principle
should not apply in civil cases where the quantum of evidence is only
preponderance of evidence.
As aptly observed by the CA which we hereby adopt:

Ironically for the defendant, aside from appellants assumption that Baltazar could be a
disgruntled former employee of their company and could be biased (which same
reason could be attributed to Lloyd Fojas) due to a distant relationship with the
plaintiff, it offered no proof or evidence to rebut, demean and contradict the substance
of the testimony of Baltazar on the crucial point that plaintiffs-appellees were bumped
off to accommodate non-revenue, waitlisted or go-show passengers. On this fact
alone, defendants position weakens while credibly establishing that indeed plaintiffs
arrived at the airport on time to check-in for Flight PR 178. Further emphasis must be
made that Lloyd Fojas even affirmed in court that he can not recall how many PR 178
boarding passes he had at the check-in counter because management has authority to
accommodate in any flight and correspondingly issue boarding passes to non-revenue
passengers (pages 15-16, TSN, January 24, 1990). [31]

Indeed, petitioner, through its lone witness Fojas, could only answer during
his examination on the witness stand that he is unable to recall the
circumstances recommending the issuances of boarding passes to waitlisted
and that it is the management which has the authority to issue boarding passes
to non-revenue passengers. Even in the afternoon flight, PR 180, Fojas could
[32]

not squarely deny that confirmed paying passengers were bumped-off in favor
of non-revenue ones. [33]

The CA likewise correctly concluded that there was overbooking in the

morning flight on the basis of the testimony of private respondents witness
Manuel Baltazar, to wit:
ATTY. CALICA:
Q- There was a memorandum order of the PAL prohibiting overbooking. Are you aware
of CAB Regulation No. 7 on boarding passengers?
 WITNESS:
A- Yes.
ATTY. CALICA:
Q- You will agree with me that this regulation allows only overbooking by 10%?
WITNESS:
A- Yes, that is a government regulation and the company regulation is different.
COURT:
Q- But in the morning flight of May 8, 1988, granting that the government regulation
allows only 10% overbooking, can you tell the Court from the manifest itself whether
it exceeded the 10% overbooking allowed by the regulation reckoning from the 109
passenger seater?
WITNESS:
A- With the capacity of 109, 10% of it will be 10 or 11, so if we add this it will not exceed
120 passengers.
COURT:
Q- In that flight how many were confirmed?
WITNESS:
Q- In that flight those passengers that were confirmed have a total of 126.
COURT:
Q- Even if when allowed the government regulation of overbooking, you will still exceed
the allowable overbooking number?
WITNESS:
A- Yes.[34] (Emphasis supplied)

This fact of overbooking, again, was not adequately refuted by petitioners

evidence.
The appellate court aptly sustained the trial court in giving probative weight
to the testimony of private respondent Judy Amor that there were other
passengers who were not accommodated in flight PR 178, to wit:
Q: And how about you, what did you do when you arrived at
the Legaspi Airport at 6:20 while Salvador Gonzales was at the check-in counter to
pay the tickets?
A: I went to the Office of the OIC Manager at the right side of the Legaspi Terminal.
Q: Who was that Manager?
A: I was able to know his name as Delfin Canonizado.
Q: There were also people there near the table of Mr. Canonizado, do you know what
were they doing?
 A: They were making complaints also because they were also scheduled for flight on
that day. They were not accommodated.[35] (Emphasis supplied)

We have noted an inconsistency in the testimony of private respondents

witness, Salvador Gonzales in the direct and cross-examinations. In his direct
testimony, Gonzales stated that while he was waiting in line at the check-in
counter, with four persons still ahead of him, Lloyd Fojas asked him to approach
the counter, took private respondents tickets and wrote something on them. It
was only later on when his turn came, that he found out that what Fojas wrote
on the tickets was late check-n 7:05. On cross-examination, Gonzales testified
that it was only after the four persons ahead of him were accommodated
that Fojas wrote on the tickets late check-in 7:05. However,
upon clarificatory questions propounded by the trial court, Gonzales was able
to clarify that Fojas had written the time on the ticket before the four persons
ahead of him were entertained at the counter. Understandably, the lower
[36]

courts found no cogent reason to discredit the testimony of witness Gonzales.

We have held in an earlier case that a witness may contradict himself on
the circumstances of an act or different acts due to a long series of questions
on cross-examination during which the mind becomes tired to such a degree
that the witness does not understand what he is testifying about, especially if
the questions, in their majority are leading and tend to make him ratify a former
contrary declaration. [37]

In fine, the findings of fact of the trial court, as sustained by the CA, have to
be respected. As we have consistently held, trial courts enjoy the unique
advantage of observing at close range the demeanor, deportment and conduct
of witnesses as they give their testimonies. Thus, assignment to declarations
on the witness stand is best done by them who, unlike appellate magistrates,
can weigh firsthand the testimony of a witness. [38]

Anent the second issue as to whether or not the damages awarded are
excessive, we rule in the affirmative. The Court of Appeals committed an error
in sustaining the ruling of the trial court requiring petitioner to reimburse private
respondents the amount of four plane tickets, including the ticket for private
respondent minor Carlo Benitez.
As admitted by private respondent Judy in her testimony, the only confirmed
tickets for the morning flight (PR 178) are the tickets for herself, her infant
son, Gian Carlo and her sister Jane Gamil. They had another ticket which Judy
bought for a certain Dra. Emily Chua who backed out and whose ticket they had
intended to be transferred to Carlo Benitez. Although it is clearly stated in the
[39]

ticket that the same is non-transferrable, Judy testified that a PAL employee
[40]

issued another ticket in the name of Carlo Benitez in lieu of the ticket issued
for Dra. Chua. However, an examination of the ticket issued, Exhibit C,
discloses that it does not state therein the flight number or time of
departure. Consequently, in the absence of competent evidence, private
respondent Carlo Benitez complaint should be dismissed.
We find no justifiable reason that warrants the award of P100,000.00 as
actual damages in favor of all private respondents. Article 2199 of the Civil
Code, provides that actual or compensatory damages may only be given for
such pecuniary loss suffered by him as he has duly proved. We explained
in Chan vs. Maceda that:
[41]

A court cannot rely on speculations, conjectures or guesswork as to the fact and

amount of damages, but must depend upon competent proof that they have been
suffered by the injured party and on the best obtainable evidence of the actual amount
thereof. It must point out specific facts which could afford a basis for measuring
whatever compensatory or actual damages are borne. [42]

All that was proved by herein private respondents was the amount of the
purchase price of the plane tickets of private respondents Judy, Jane
and Gian Carlo. Only said amounts should therefore be considered in awarding
actual damages. As borne by the records, private respondent
Judy Amor paid P466.00 each for her ticket and that of Jane; while she
paid P46.60 for her infant Gian Carlo. The amount of actual damages should
[43]

therefore be reduced to P978.60, payable to private respondent Judy Amor.

As to moral damages.
It should be stressed that moral damages are not intended to enrich a
plaintiff at he expense of the defendant but are awarded only to allow the former
to obtain means, diversion or amusements that will serve to alleviate the moral
suffering he has undergone due to the defendants culpable action. We [44]

emphasized in Philippine National Bank vs. Court of Appeals that moral

damages are not punitive in nature but are designed to somehow alleviate the
physical suffering, mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social humiliation and similar injury
unjustly caused to a person. We have held that even though moral damages
are incapable of pecuniary computation, it should nevertheless be proportional
to and in approximation of the suffering inflicted. And, to be recoverable, such
damage must be the proximate result of a wrongful act or omission the factual
basis for which is satisfactorily established by the aggrieved party. [45]

In the case at bar, private respondent Judy Amor testified that she felt
ashamed when the plane took off and they were left at the airport since there
were many people there who saw them including dentists like her. She also
related that she missed the Philippine Dental Convention scheduled on the
8th of May, 1988 where she was supposed to attend as a dentist and officer of
the Sorsogon Dental Association. They tried to look for buses bound
for Manila but missed those scheduled in the morning. They went back to the
airport but still failed to take an afternoon flight. Hence, she was forced to take
a bus that evening for Manila which did not allow her to sleep that
night. Private respondent Judy however did not miss the whole convention as
[46]

she was able to leave on the night of the first day of the week-long convention.
While there is no hard and fast rule for determining what would be a fair
amount of moral damages, generally, the amount awarded should be
commensurate with the actual loss or injury suffered. [47]

The CA erred in upholding the trial courts award of moral damages based
on Judy Amors claim that there was a denigration of her social and financial
standing. Private respondent Judy failed to show that she was treated rudely or
disrespectfully by petitioners employees despite her stature as a dentist. As we
held in Kierulf vs. Court of Appeals [48]

The social and financial standing of Lucila cannot be considered in awarding moral
damages. The factual circumstances prior to the accident show that no rude and rough
reception, no menacing attitude, no supercilious manner, no abusive language and
highly scornful reference was given her.The social and financial standing of a
claimant of moral damages may be considered in awarding moral damages only
if he or she was subjected to contemptuous conduct despite the offenders
knowledge of his or her social and financial standing. (Emphasis supplied)
[49]

Nevertheless, we hold that private respondent Judy Amor is entitled to

moral damages. In a number of cases, we have pronounced that air carriage is
a business possessed with special qualities. In Singson vs. Court of
Appeals, we explained that:
[50]

A contract of air carriage is a peculiar one. Imbued with public interest, common
carriers are required by law to carry passengers safely as far as human care and
foresight can provide, using the utmost diligence of a very cautious person, with due
regard for all the circumstances. A contract to transport passengers is quite different in
kind and degree from any other contractual relation. And this because its business is
mainly with the traveling public. It invites people to avail of the comforts and
advantages it offers. The contract of carriage, therefore, generates a relation attended
with a public duty. Failure of the carrier to observe this high degree of care and
extraordinary diligence renders it liable for any damage that may be sustained by its
passengers. [51]
 As the lower courts have found, evidence positively show that petitioner has
accommodated waitlisted and non-revenue passengers and had overbooked
more than what is allowed by law, to the prejudice of private respondents who
had confirmed tickets.Overbooking amounts to bad faith and therefore[52]

petitioner is liable to pay moral damages to respondent Judy Amor.

Considering all the foregoing, we deem that the award of P250,000.00 as
moral damages in favor of private respondent Judy Amor is exorbitant. Where
the damages awarded are far too excessive compared to the actual losses
sustained by the aggrieved party, the same should be reduced to a more
reasonable amount. We find the amount of P100,000.00 to be sufficient, just
[53]

and reasonable.
We consider the award of actual damages in favor of private respondent
Jane Gamil to be inappropriate considering the testimony of Judy Amor that
she was the one who paid for the tickets. Likewise, the appellate court erred
[54]

in sustaining the award of moral damages in favor of Jane Gamil as she never
testified in court. It has been held that where the plaintiff fails to take the witness
stand and testify as to his social humiliation, wounded feelings and anxiety,
moral damages cannot be recovered. [55]

As to the award of exemplary damages, Article 2234 of the Civil Code

provides that the claimant must show that he would be entitled to moral,
temperate or compensatory damages before the court may consider the
question whether or not exemplary damages should be awarded.
Consequently, private respondent Jane Gamil, not being entitled to actual
and moral damages, is not entitled to exemplary damages.
The award of exemplary damages in favor of private respondent
Judy Amor is warranted in this case. Waitlisted and non-revenue passengers
[56]

were accommodated while private respondent Judy Amor who had fully paid
her fare and was a confirmed passenger was unduly deprived of
enplaning. Petitioner was guilty of overbooking its flight to the prejudice of its
confirmed passengers. This practice cannot be countenanced especially
considering that the business of air carriage is imbued with public character. We
have ruled that where in breaching the contract of carriage, the airline is shown
to have acted in bad faith, as in this case, the award of exemplary damages
[57]

in addition to moral and actual damages is proper. However, as in the matter

[58]

of the moral damages awarded by the trial court, we consider the amount
of P200,000.00 as exemplary damages to be far too excessive. The amount
of P25,000.00 is just and proper.
 We find the award of attorneys fees in this case to be in order since it is well
settled that the same may be awarded when the defendants act or omission
has compelled the plaintiff to litigate with third persons or to incur expenses to
protect his interest.
[59]

WHEREFORE, we affirm the decision of the Court of Appeals with the

following MODIFICATIONS:
1. Petitioner is ordered to pay private respondent Judy Amor the amount
of P978.60 as and for actual damages; P100,000.00 as moral
damages; P25,000.00 as exemplary damages; and attorneys fees in the
amount of P30,000.00 plus P500.00 for every appearance of private
respondents lawyer, or a total of P10,500.00 for 21 actual appearances in
court; P2,000.00 as incidental litigation expenses; and costs of suit.
2. The claim for damages of private respondent Jane Gamil is DENIED for
lack of evidence.
3. The complaint of private respondent Carlo Benitez is DISMISSED for lack
of cause of action.
No pronouncement as to costs.
SO ORDERED.