G.R. No.
134239 May 26, 2005 On May 9, 1989, in the Office of the Barangay Captain of Barangay Tres,
REYNALDO VILLAFUERTE and PERLITA T. VILLAFUERTE, petitioners,
vs.
HON. COURT OF APPEALS, EDILBERTO DE MESA and GONZALO
DALEON, respondents.
DECISION
CHICO-NAZARIO, J.:
This is a petition for review on certiorari of the Decision1 of the Court of Appeals in
CA-G.R. CV No. 41871 which affirmed, with modification, the decision 2 of the
Regional Trial Court, Branch 55, Lucena City, in Civil Case No. 90-11 entitled,
"Reynaldo C. Villafuerte and Perlita Tan Villafuerte v. Edilberto De Mesa and Gonzalo
Daleon."
The facts, as established by the Court of Appeals, follow:
Appelees – the spouses Reynaldo C. Villafuerte and Perlita Tan-Villafuerte –
operated a gasoline station known as Peewee's Petron Powerhouse Service
Station and General Merchandise on the premises of three (3) adjoining lots
at the corner of Gomez Street and Quezon Avenue in Lucena City. One of
these lots, Lot No. 2948-A with an area of 575 square meters, is owned by
several persons, one of whom is appellant Edilberto de Mesa, while the
other lot, Lot 2948-B with an area of 290 square meters, is owned by
appellant Gonzalo Daleon and his brother Federico A. Daleon. The
remaining lot belongs to Mrs. Anicia Yap-Tan, mother of appellee Perlita
Tan-Villafuerte.
Appellants Edilberto de Mesa and Gonzalo Daleon acquired their respective
lots subject to the lease by Petrophil Corporation which had built thereon the
gasoline station being managed by the Villafuerte couple. When the lease of
Petrophil Corporation expired on December 31, 1988, the Villafuertes
obtained a new lease on Lot No. 2948-A from appellant Edilberto de Mesa
for a period expiring on December 31, 1989, thus:.
"1 – This lease will be for a period of one (1) year only, from January 1, 1989
and will terminate on the 31st of December 1989 at a monthly rental of FOUR
THOUSAND PESOS (P4,000.00)." (Exhibit "1-A-1" De Mesa).
As regards Lot 2948-B of the Daleon brothers, the Villafuertes were not as
lucky. For, instead of obtaining a lease renewal, what they received were
demand letters from the brothers' counsel ordering them to vacate the
premises. Instead of complying therewith, the Villafuertes simply ignored the
demand and continued operating the gas station (Exhibits "3-B", "3-C" and
"3-F", Daleon).
Lucena City, a complaint for ejectment was filed by Gonzalo Daleon against
the Villafuertes (Exhibit "6", Daleon). Evidently, no settlement was reached
thereat, as shown by a certification to file action issued by the lupon.
With their problem with the Daleon brothers far from over, the Villafuertes
were apt for another one; their lease contract with Edilberto de Mesa was
not renewed when it expired on December 31, 1989. Nonetheless, and
duplicating what they had done in the case of the property of the Daleon
brothers, the spouses continued to operate their gasoline station and other
businesses on the lot of de Mesa despite the latter's demand to vacate.
What transpired next lays at the core of the instant controversy.
It appears that in the early morning of February 1, 1990, appellants Edilberto
de Mesa and Gonzalo Daleon, with the aid of several persons and without
the knowledge of the Villafuertes, caused the closure of the latter's gasoline
station by constructing fences around it.
The following day – February 2, 1990 – the Villafuertes countered with a
complaint for damages with preliminary mandatory injunction against both
Edilberto de Mesa and Gonzalo Daleon. Docketed in the court below as Civil
Case No. 90-11, the complaint seeks vindication for the alleged malicious
and unlawful fencing of the plaintiffs' business premises (Records, pp. 1-6).
Invoking their status as owners of the withheld premises, the defendants
admitted in their respective answers having caused the fencing of the
plaintiffs' gasoline station thereat but reasoned out that they did so on
account of the plaintiffs' refusal to vacate the same despite demands.
After hearing the parties in connection with the plaintiffs' application for a writ
of preliminary mandatory injunction, the lower court, in its order of May 23,
1990, ruled that with the expiration of the lease on the defendants' property,
the plaintiffs have no more right to stay thereon and, therefore, cannot
pretend to have a clear and unmistakable right to an injunctive writ and
accordingly denied their application therefore (Rec., p. 186). In a subsequent
order of July 30, 1990, the same court denied the Villafuertes' motion for
reconsideration (Rec., p. 237).
Later, with leave of court, the Villafuertes amended their complaint to allege,
among others, that the complained acts of the defendants cost them the
following items of actual damages:
a) Daily Sales (4000-5000 lts.) at .35¢lt.
mark-up, P1,750 x 270 days P472,
b) Storage Fee of POL (Petroleum, Oil & Lubricants)
Recom 4 at 5% for 100,000 lts.
= 5000 lts. X 3 quarters x P6.00/lt. 90,
 c) Tires, Batteries, Accessories (TBA) Gen.
Merchandise Sales, P50,000/mo. 20% mark-Up =
P10,000 x 9 months
d) Hauling of Petroleum products for Peewee's Petron
Powerhouse, 2 trips weekly, P1,500 X 8 trips/mo. X 9
months
e) Hauling of Petroleum products for military
7 trips/qtr., P1,500/trip x 21 (3 qtrs.)
f) Balloon Business (Sunshine Balloons)
P50,000.00 capital, P6,000/mo. Income
TOTAL LOSS
g) Uncollected Debts
h) Uncollected Checks
i) Merchandise Inventory as of July 25, 1990,
P141,036.50 value, 50% damaged
j) Damaged Office Equipments
k) Stampitas (Religious Articles) and other
Hermana Fausta Memorial Foundation, Inc.
printed matters entrusted in my care,
totally damaged by rain and termites
l) Products lost in 4 underground tanks
m) Interest payments to RCBC (Rizal Commercial
Banking Corporation) for additional loan availed of to
pay off products acquired on credit from Petron Corp.
but were held inside gas station
TOTAL --
The amended complaint thus prayed for the following reliefs:
"WHEREFORE, it is respectfully prayed of this Hon. Court that judgment be
rendered in favor of the plaintiffs:
A - Immediately ordering the issuance of a writ of preliminary mandatory
injunction against the defendants commanding them and any person acting
in their behalf to forthwith remove the fence they have constructed around
the premises in question, and after trial making the said injunction
permanent.
B - Ordering the defendants to pay jointly and severally the plaintiffs the
following:
1) Moral damages equivalent to not less than P200,000.00;
2) Exemplary damages in the amount of P50,000.00;
90,000.00 3) Attorney's fee in the amount of P60,000.00 plus twenty-five percent (25%)
of the amount of damages to which plaintiffs are entitled; and
108,000.00 4) Litigation expenses in this instance in the amount of P10,000.00
31,500.00 C - Requiring the defendants to pay jointly and severally actual damages
representing unrealized income and profits as well as losses referred to in
paragraphs 10 and 12 hereof in such amount as may be shown in evidence
during the hearing.
200,000.00
619,030.61 D - Granting the plaintiffs such other just and equitable remedies to which
they may be entitled under the law and equity." (Orig. Rec., pp. 292-293).
37,449.05
As later events disclosed, the defendants resumed possession of the
70,518.25 premises in question on January 25, 1991 (Rec., p. 333). Four (4) days later,
they obtained a judgment by compromise from the Municipal Trial Court in
30,000.00 Cities, Lucena City in connection with the suit for ejectment they earlier filed
thereat against Petrophil Corporation. In that judgment, Petrophil bound itself
to remove the materials and equipment related to the operation of the
gasoline station on the subject premises. (Rec., pp. 355-356).
5,000.00
After the parties herein had presented their respective evidence, the lower
249,805.00 court came out with the decision now under review. Dated November 13,
1990, the decision dispositively reads:
"WHEREFORE, judgment is hereby rendered in favor of the
172,490.53 plaintiffs and ordering the defendants Edliberto de Mesa and
Gonzalo Daleon to pay, jointly and severally, plaintiffs the following:
P2,176,293.44
1. Actual damages in the total amount of TWO MILLION ONE
HUNDRED SEVENTY SIX THOUSAND AND TWO HUNDRED
NINETY THREE PESOS AND FORTY FOUR CENTAVOS
(P2,176,293.44);
2. Moral damages in the amount of P200,000.00;
3. Exemplary damages in the amount of P50,000.00;
4. P50,000.00, as and for attorney's fees; and
5. Costs of suit.
SO ORDERED" (Rec., pp. 408-414).[3]
The trial court ruled that with the continued occupation by petitioners of the two lots
belonging to private respondents, despite the expiration of the lease contracts over
the same, petitioners had become "undesirable lessees." 4 However, it was improper
for private respondents to resort to fencing their properties in order to remove
petitioners from the premises in the light of the clear provision of the Civil Code on the
matter, to wit:
Art. 536. In no case may possession be acquired through force or
intimidation as long as there is a possessor who objects thereto. He who
believes that he has an action or a right to deprive another of the holding of
a thing, must invoke the aid of the competent court, if the holder should
refuse to deliver the thing.
Having disregarded the plain requirement of the law, private respondents were held
accountable to petitioners for the various damages prayed for by petitioners in their
amended complaint.
In due time, private respondents filed their respective appeals before the Court of
Appeals which affirmed, with modification, the decision of the trial court. The
dispositive portion of the appellate court's decision reads:
WHEREFORE, the decision appealed from is MODIFIED by holding the
appellants jointly and severally liable to the appellees for P50,000.00 as
exemplary damages and for P27,000.00 as actual damages, itemized as
follows:
1. detention of the records: P7,000.00;
2. detention of the merchandise: P10,000.00;
3. value of the damaged merchandise and religious items: P5,000;
and
4. detention of offices equipment: P5,000.00,
and by holding the appellees jointly and severally liable for rental to
appellants Edilberto de Mesa and Gonzalo Daleon in the amount of
P5,500.00 and P39,000.00, respectively.
The deficiency in the payment of the docket fees, to be computed by the clerk of court
of the lower court, shall constitute a lien on this judgment. 5
In adjudging private respondents liable for damages, the Court of Appeals
substantially ruled that:
1. Private respondents could not invoke the doctrine of self-help contained in
Article 429 of the Civil Code6 reasoning that the doctrine finds no application
when occupation was effected through lawful means such as in this case
where petitioners' possession of the lots owned by private respondents was
effected through lease agreements;
2. Petitioners' continued unauthorized occupation of private respondents'
properties may have been illegal, however, it was incumbent upon private
respondents to abide by the express provision of Article 536 of the Civil
Code requiring recourse to the proper court prior to ousting petitioners from
their (private respondents') lots;
3. On the matter of insufficient docket fees paid by petitioners during the
institution of this action, the Court of Appeals declared that "whatever
deficiency there may be in the docket fees can be levied from the amount
that may be awarded the appellees (petitioners herein)" 7 and that private
respondents were already estopped from assailing the jurisdiction of the trial
court;
4. Private respondents could not invoke the principle of damnum absque
injuria as this doctrine only applies "when the loss or damage does not
constitute a violation of a legal right or amounts to a legal wrong"8 and not to
this case where private respondents clearly violated the law by unilaterally
displacing petitioners from the subject premises;
5. On the issue of actual damages, the appellate court substantially reduced
the amount of actual damages awarded by the court a quo upon the ground
that petitioners failed to substantiate their claims thereto except for the
detention of petitioners' records of their receivables, various merchandise,
damaged goods, religious items, and office equipment;
6. As for the propriety of awarding moral damages to petitioners, the Court of
Appeals held that petitioners are not entitled to this form of damage as this
case does not fall within Article 2219 of the Civil Code;
7. Although Article 2219 of the Civil Code encompasses incidents which may
fall within the purview of Article 21 of the Civil Code, the latter, being a rule
based on equity, necessitates the claimant to come to court with clean
hands which cannot be said of petitioners who continued to occupy the lands
belonging to private respondents without the authority of a subsisting lease
agreement;
8. Private respondents are nevertheless liable for exemplary damages for
having taken the law into their own hands by fencing the premises of the
Petron gasoline station operated by petitioners instead of seeking redress
from the proper court as mandated by Article 536 of the Civil Code; and
9. Petitioners are liable to pay private respondents for the unpaid rentals
from the time the lease agreements over the subject properties expired until
01 February 1990 when private respondents constructed the fence.
Dissatisfied with the ruling of the Court of Appeals, petitioners are now before us
raising, in the main, the issue of whether the appellate court erred in substantially
reducing the amount of damages earlier awarded to them by the trial court.
Petitioners insist that the appellate court "resorted to assumptions, inferences,
surmises and conjectures in disallowing certain items of actual damages like lost
petroleum products valued at P249,805.00, loss of value of merchandise detained for
a quite a long time (sic) in the fenced premises and uncollected debts as against the
positive testimony of petitioner Perlita Villafuerte which remained unrebutted and
uncontested even on appeal."9 They also allege that the list of unrealized income,
collectibles and damages prepared by petitioner Perlita was based and ably
supported by documents.
Petitioners also maintain that the Court of Appeals erred in finding that they came to
court with "unclean hands," thus, depriving them of entitlement to moral damages.
According to petitioners, their continued occupation of private respondents' properties
was based on their belief that their lease contract with private respondent De Mesa
was modified and extended whereas private respondent Daleon had verbally agreed
to allow them to continue with their possession of his lot for as long as the Petron
Corporation's equipment remain in the premises.
Finally, petitioners argue that the trial court was correct in awarding in their favor
attorney's fees in the amount of P50,000.00 as they were compelled to engage the
services of counsel in order to seek vindication from the arbitrary action of private
respondents.
After a considered review of the records of this case, we resolve to affirm, with
modification, the decision of the Court of Appeals.
Both the trial court and the Court of Appeals concluded that the lease contracts
between petitioners and private respondents over the latter's respective lots had
already expired. There was also a congruence of findings that it was wrong for private
respondents to fence their properties thereby putting to a halt the operation of
petitioners' gasoline station. To this, we agree.
Article 536 of the Civil Code previously quoted explicitly provides for the proper
recourse of one who claims to be entitled to the possession of a thing. When private
respondents personally took it upon themselves to evict petitioners from their
properties, which act was in clear contravention of the law, they became liable "for all
the necessary and natural consequences of [their] illegal act."10
As expected, petitioners instituted this action praying that private respondents be held
liable for actual damages, moral damages, exemplary damages, attorney's fees, and
costs of litigation. We shall resolve their right to these damages in seriatim.
Actual or compensatory damages are those awarded in order to compensate a party
for an injury or loss he suffered. They arise out of a sense of natural justice and are
aimed at repairing the wrong done.11 Except as provided by law or by stipulation, a
party is entitled to an adequate compensation only for such pecuniary loss as he has
duly proven.12 It is hornbook doctrine that to be able to recover actual damages, the
claimant bears the onus of presenting before the court actual proof of the damages
alleged to have been suffered, thus:
A party is entitled to an adequate compensation for such pecuniary loss
actually suffered by him as he has duly proved. Such damages, to be
recoverable, must not only be capable of proof, but must actually be proved
with a reasonable degree of certainty. We have emphasized that these
damages cannot be presumed and courts, in making an award must point
out specific facts which could afford a basis for measuring whatever
compensatory or actual damages are borne.13
We have exhaustively perused the records of this case and thus conclude that
petitioners have miserably failed to proffer evidence capable of sustaining their plea
for actual damages. We note that when petitioner Perlita was directly examined with
respect to her unrealized income14 for the following matters, namely: daily sales of
various petroleum products;15 storage fee of RECOM IV's petroleum, oil, and
lubricants;16 sales of tires, batteries, accessories, and general merchandise; 17 hauling
of petroleum products for Peewee's Petron Powerhouse by the gasoline tankers
owned by petitioners;18 hauling of petroleum products for the military;19 and petitioner
Perlita's balloon business which she conducted within the premises of the fenced
gasoline station,20 she repeatedly testified that she arrived at these claimed amounts
based on the average of her sales for the month of January 1990, the number of trips
undertaken by their tankers, and average volume of the gasoline deposit for RECOM
IV. Her testimony on these matters went as follows:
Atty. CAMALIGAN:
May I ask that this List of Unrealized Income, Collectibles and
Damages from Febrauary 1, 1990 to October 30, 1990 be marked
as Exhibit AA.
...
Q: Will you explain to the court why this list you made is up to October 30,
1990?
A: I prepared this list until October 10, 1990 in preparation for our first
hearing sometime in November, sir.
Q: I am calling your attention to No. 1 which is I quote, "Daily Sales (4,000 to
5,000 liters) at P0.035 per liter mark up – P1,750.00 by 270 days amounting
to P472,500.00" will you explain to the court how you incurred this damage?
(A): After the closure of our gasoline station that was February 1, 1990 and
then until September, 1990 is nine (9) months and that is 270 days. I went
thru my sales for January and the average sales (is) 4,000 to 5,000 liters
and so for our daily sales of 4,000 to 5,000 liters sale at P0.35 centavos
mark-up, I got P1,750.00 daily so that is times 270 days until September
1990, the total is P472,500.00, sir.
COURT: That is gross?
A: Yes, your Honor.
COURT: What about the net income to be realized?
A: Your Honor, we will deduct from here the salaries and wages of the
gasoline boys and electric bill, maybe P0.25 centavos per liter.
COURT: Proceed.
Q: Is the mark-up of P0.35 centavos per liter thru (sic), irrespective of
amount of gasoline or value of gasoline per liter?
A: We have different kinds of petroleum products, extra, regular and diesel
and the average mark-up is thirty-five (35) centavos.
...
Q: Calling your attention to No. 2 in the list which refers to storage fee of
petroleum, oil and lubricant from RECOM IV amounting to a total of ninety
thousand pesos (P90,000.00) will you kindly explain how you arrived at this
amount?
A: The military, PC/INP RECOM IV which is stationed at Camp Nakar has
entered into an agreement with us to deposit their petroleum, oil and
lubricant for every quarter, sir.
Q: Under what condition was that deposit made for?
A: That they will be able to withdraw the said products for a certain storage
fee, sir, and the storage fee is 5% which would cover disposing the products
and also certain percent of evaporation.
COURT: Five percent of what?
A: Five percent of the number of liters deposited with us so that if they
deposited one hundred thousand (100,000) liters we are paid in terms of
gasoline also, five thousand (5,000) liters.
Q: What was the average volume of deposit made by the RECOM IV?
A: It is on a quarterly basis, that is one hundred thousand (100,000) liters
quarterly, sir.
Q: On item 3 referring to tires, batteries, accessories, general merchandise
is listed an amount of ninety thousand (P90,000.00) pesos as your losses,
will you please explain how you incurred such losses?
A: Aside from petroleum products we also sell accessories for the motoring
public and they are in kinds like tires, batteries and some additives, how do
you realize income out of this? (sic)
A: We have 20% mark-up on the merchandise and last January 1990 I
average fifty thousand (P50,000.00) pesos gross income on the general
merchandise so for 20% mark-up that is more or less ten thousand
(P10,000.00) pesos and for nine (9) months that is ninety thousand
(P90,000.00) pesos, sir.
Q: In item No. 4 appearing in your list you listed a total amount of one
hundred eight thousand (P108,000.00) pesos, for hauling of petroleum
products for Peewee's Petron Powerhouse, will you explain to the court this
hauling?
A: My husband and I run a fleet of gasoline tankers and they are hauling
petroleum products for our gasoline stations and for the military accounts.
We average two (2) deliveries every week so this is already a net of one
thousand five hundred (P1,500.00) pesos per delivery. It is two thousand
eight hundred (P2,800.00) pesos per delivery and deducting the salaries of
the drivers, the fuel consumption and the depreciation of the tankers, we
incur a net of one thousand five hundred (P1,500.00) pesos per trip. Every
month we incur at least eight (8) trips and that is one thousand five hundred
(P1,500.00) pesos times eight (8) trips times nine (9) months and I got one
hundred eight thousand (P108,000.00) pesos total.
Q: Do you own them?
A: Yes, sir.
Q: In item No. 6 you listed Balloon Business under Sunshine Balloon, you
have given a total amount of two hundred thousand (P200,000.00) pesos as
your losses here, will you please explain to the Court how you incurred these
losses?
...
A: Inside the gasoline station we also operate a balloon business and we
have invested fifty thousand capital on this balloon business. This business
has been thriving for several years and we usually incur six (6) thousand
monthly income from said business, sir. Now that the gasoline station was
 closed with all the equipments of the balloon business inside also, we have
totally lost the market for the balloon business and I feel that two hundred
thousand (P200,000.00) pesos would have to be paid for the total loss of the
business.21
Noticeably, petitioner Perlita's testimony was replete with claims that her unrealized
income, as far as these items were concerned, were based on the "average." Except,
however, for the record of daily petroleum sales for the month of January
1990,22 petitioners failed to present any evidence that would sufficiently establish their
mean income from these business undertakings. In the absence of any corroborative
proof, this Court is not bound to award in petitioners' favor the actual damages for
items a, b, c, d, e, and f of her alleged unrealized income. Nor can we give premium
on the summary of daily petroleum sales for January 1990 prepared by petitioner
Perlita as the same is not supported by any competent evidence; at best, said exhibit
is self-serving.
Anent the actual damages claimed for the deterioration of the items which remained
inside petitioners' office, petitioner Perlita testified that when they were able to retrieve
the merchandise from the gasoline station, they noticed that most of them were
already defective and so they "valued"23 the damages thereto at seventy (70%) of
their total value. As for the items entrusted to her by the Hermana Fausta Memorial
Foundation of which she was the executive vice president at that time, petitioner
Perlita alleged that the amount of five thousand pesos represents the production cost
of these materials which the foundation purportedly paid to Imprenta Lucentina. As
regards the amount of P30,000.00 sought as actual damages for the damaged office
equipment, petitioner Perlita stated before the trial court that she arrived at this figure
after computing the acquisition costs of these equipment which she
"approximated"24 to be P35,000.00.
Evidently, in establishing the amount of actual damages for the merchandise
inventory, office equipment, and materials owned by the Hermana Fausta Memorial
Foundation, petitioners relied solely on their own assessment of the prices of these
items as well as the damage thereto purportedly occasioned by the fencing of the
gasoline station. This is clearly demonstrated by the inconsistent stance of petitioner
Pertlita with regard to the percentage of damaged merchandise stored in the gasoline
station, thus:
ATTY. CAMALIGAN:
Q: I noticed that the total appearing on page 3 of your merchandize
inventory is one hundred forty one thousand thirty six pesos and fifty
centavos (P141,036.50) only while in your list, it is ninety eight thousand
seven hundred twenty five pesos and fifty five centavos (P98,725.55), will
you please explain the same?
WITNESS:
A: This list with the total amount of one hundred forty one thousand thirty six
pesos and fifty centavos (P141,036.50) represent the total value of all the
merchandize but then the reason why we have the ninety eight thousand
seven hundred twenty five pesos and fifty five centavos (P98,725.55) figure
is, this represents seventy percent (70%) of the total amount because when
we retrieved the merchandize, we noticed that most of them are already
defective, so we valued the damages only seventy percent (70%) of the total
value because some of them could still be sold, sir.
ATTY. CAMALIGAN:
Q: I noticed there is a correction in Item No. 9 from ninety percent (90%) to
seventy percent (70%). When did you make that correction?
A: Only last December 30, 1990 after we have retrieved all the merchandize.
I prepared this list on October 31, 1990 not realizing the extent of the real
damages to the merchandize but when we retrieved them last December 29
and upon inspection, most of the motor oil have already leaked because of
the plastics that were exposed to sun and rain, so we changed the estimate
to seventy percent (70%), sir.25
Such arbitrary estimations run afoul with our consistent pronouncement that actual or
compensatory damages cannot be presumed but must be proved with reasonable
degree of certainty.26 A court cannot simply rely on speculation, conjecture or
guesswork as to the fact and amount of damages, but is required to depend upon
competent proof that the claimant had suffered and on evidence of the actual amount
thereof.27 Failing in this regard, we resolve to delete the award of actual damages
rendered by the Court of Appeals with respect to these items.
Similarly, we rule that petitioners are not entitled to the total amount of the 17 checks
issued in their favor by their customers and to the amount of uncollected debts owed
to them by their patrons. Petitioners maintain that their customers were used to
coming to their gasoline station in order to settle their obligations but were prevented
from doing after the 01 February 1990 incident. They therefore would like to hold
private respondents accountable for these receivables. This, we can not grant.
The records indicate that petitioners filed before the trial court a motion to allow them
to enter the gasoline station subject of this dispute in order to make an inventory of
their property that were locked inside and to remove those they needed for their
personal use.28 Among the items removed from the gasoline station were the receipts
evidencing petitioners' receivables from their customers 29 as well as the 17
uncollected checks.30 Obviously, after the court-approved ocular inspection
conducted on 24 July 1990 and 25 July 1990, petitioners were already in possession
of the evidences of credit of their customers. There was nothing, not even the closure
of their gasoline station, which stood in the way of petitioners' exerting earnest efforts
in going after their debtors.
Petitioners likewise seek to be compensated for the value of the petroleum products
allegedly lost from the four underground tanks between the period 01 February 1990
until 25 July 1990 when an ocular inspection was conducted within the disputed
property. According to petitioners, after they compared the volume of the tanks'
contents as of the evening of 31 January 1990 with the dipstick reading on 25 July where the claimants were victims of capricious, wanton, oppressive, malicious, and
1990, they discovered that they had lost thousands of liters of petroleum products. On arbitrary acts such as petitioners in this case. On this issue, we agree in the findings
this point, we quote with approval the conclusion of the Court of Appeals, to wit: of the Court of Appeals that:

The appellees31 failed to adduce convincing evidence that appellants are the The Court must have to disallow the lower court's award of moral damages.
ones responsible for the loss of the petroleum products in the four (4) The concept of moral damages, as announced in Article 2217 of the Civil
underground tanks (item "1," paragraph 10 of Amended Complaint). Code, is designed to compensate the complainant for his physical suffering,
Although the premises which were fenced by the appellants32 adjoin the lot mental anguish, fright, serious anxiety, besmirched reputation, wounded
of Perlita's mother and are even secured by appellees' guard, the appellees feelings, moral shock, social humiliation and similar injury occasioned by the
did not present anyone to testify on the fact of loss of said gasoline products. defendant's wrongful act or omission. Article 2219 of the same Code
Instead, they chose to rely on Perlita's bare assertion that she specifies the cases where moral damages may be awarded, to wit:
lost P249,805.00 in terms of petroleum products that allegedly disappeared.
The sheer volume of the missing fuel makes it difficult for the pilferer to Art. 2219. Moral damages may be recovered in the following and
commit the deed without attracting attention. An unsubstantiated claim of analogous cases:
loss, more so of such a dimension, cannot merit an award therefor.33
(1) A criminal offense resulting in physical injuries;
Finally, with respect to the interest payments to the Rizal Commercial
Banking Corporation (RCBC), petitioners maintain that because of the
fencing of their gasoline station on 01 February 1990, they were forced to (2) Quasi-delicts causing physical injuries;
obtain a loan from RCBC in order to pay off their obligations to different
suppliers. This contention was effectively refuted by petitioner Perlita herself (3) Seduction, abduction, rape, or other lascivious acts;
when, during her re-direct examination, she admitted that the loan granted
by the RCBC was intended for all the businesses that she and her husband, (4) Adultery or concubinage;
petitioner Reynaldo, were maintaining.34 It would, therefore, be iniquitous to
charge private respondents for the interest payments for this loan the
proceeds of which were utilized to finance petitioners' various businesses (5) Illegal or arbitrary detention or arrest;
and not solely the settlement of petitioners' obligations to the suppliers of
Peewee's Petron Powerhouse. In the absence of actual proof as to how (6) Illegal search;
much of the RCBC loan was really used to pay the creditors of the closed
gasoline station, this Court can not affirm petitioners' right to be
(7) Libel, slander or any other form of defamation;
compensated for the amount of interest payments they have made to the
RCBC.
(8) Malicious prosecution;
We find, however, that an award of temperate damages to petitioners is in order. In
lieu of actual damages, temperate damages, which are more than nominal but less (9) Acts mentioned in article 309;
than compensatory damages, may be awarded where the court finds that some
pecuniary loss had been suffered by the claimant but its amount cannot be proved (10) Acts and actions referred to in articles 21, 26, 27, 28,
with certainty. Undoubtedly, pecuniary loss had been inflicted upon petitioners in this 29, 30, 32, 34, and 35.
case, however, due to the insufficiency of evidence before us, we cannot place its
amount with certainty. In this regard, we find the amount of P50,000.00 to be
The parents of the female seduced, abducted, raped or abused,
sufficient.
referred to in No. 3 of this article, may also recover moral damages.

Petitioners also assail the removal by the Court of Appeals of the moral damages
The spouse, descendants, ascendants, and brothers and sisters
previously ordered by the trial court. They argue that contrary to the findings of the
may bring the action mentioned in No. 9 of this article, in the order
appellate court, they came to court with "clean hands" as they believed that the lease
named.
contract with private respondent De Mesa was modified and extended. At the same
time, they contend that they had a verbal understanding with private respondent
Daleon wherein the latter permitted them to remain in his lot for as long as Petron Noticeably, none of the foregoing instances has any relevant bearing to the
Corporation was not removing its equipment. Further, petitioners contend that under case at bench. While Article 2219 comprehends the situation in Article 21 of
Article 2219 of the Civil Code, this Court had awarded moral damages in instances the Code, whereunder "[A]ny person who willfully causes loss or injury to
 another in a manner that is contrary to morals, good customs or public policy
shall compensate the latter for the damages," the appellees cannot benefit
from it. The right to recover moral damages under Article 21 is based on
equity, and those who come to court to demand equity must come with clean
hands (Garciano v. Court of Appeals, 212 SCRA 436 citing Padilla, CIVIL
CODE ANNOTATED, Vol. 1, 1975 Ed., p. 87). The appellees knew that their
lease had expired. Yet, despite such awareness, they persisted in their
unauthorized occupancy of appellants' property. Being partly responsible for
their present predicament which is very much within their power to avoid,
appellees cannot receive compensation for whatever mental anguish or
suffering they went thru.35

Similarly, we uphold the award of P50,000.00 as exemplary damages in order to

deter similarly minded individuals from pursuing the course of action taken by private
respondents. The law on this matter is clear: "(h)e who believes himself entitled to
deprive another of the possession of a thing, so long as the possessor refuses
delivery, must request the assistance of the proper authority."36 Petitioners' arbitrary
conduct of fencing their properties under the claim that they own the same brazenly
violates the law and circumvents the proper procedure which should be obtained
before the court.

This Court likewise adopts the conclusion reached by the Court of Appeals that
petitioners do not deserve the award of attorney's fees for it was precisely their
unfounded insistence to stay on private respondents' properties that precipitated this
suit.

WHEREFORE, the Decision of the Court of Appeals dated 31 March 1998, which
modified the Decision dated 13 November 1992 of the Regional Trial Court, Branch
55, Lucena City, and its Resolution of 17 June 1993 denying reconsideration are
hereby MODIFIED as follows:

1. The award of Twenty-Seven Thousand Pesos (P27,000.00) as actual

damages in favor of petitioners Reynaldo and Perlita Villafuerte is deleted;
and

2. Private respondents Edilberto De Mesa and Gonzalo Daleon are held

jointly and severally liable to pay petitioners the amount of Fifty Thousand
Pesos (P50,000.00) as temperate damages.

The remainder of the same Decision and Resolution of the Court of Appeals are
hereby AFFIRMED. No costs.

SO ORDERED.
 G.R. No. 107518. October 8, 1998
PNOC SHIPPING AND TRANSPORT CORPORATION, Petitioner, v. HONORABLE
COURT OF APPEALS and MARIA EFIGENIA FISHING
CORPORATION, Respondents.
DECISION
ROMERO, J.:
A party is entitled to adequate compensation only for such pecuniary loss actually
suffered and duly proved.1 Indeed, basic is the rule that to recover actual damages,
the amount of loss must not only be capable of proof but must actually be proven with
a reasonable degree of certainty, premised upon competent proof or best evidence
obtainable of the actual amount thereof.2 The claimant is duty-bound to point out
specific facts that afford a basis for measuring whatever compensatory damages are
borne.3 A court cannot merely rely on speculations, conjectures, or guesswork as to
the fact and amount of damages4 as well as hearsay5 or uncorroborated testimony
whose truth is suspect.6 Such are the jurisprudential precepts that the Court now
applies in resolving the instant petition.
The records disclose that in the early morning of September 21, 1977, the M/V Maria
Efigenia XV, owned by private respondent Maria Efigenia Fishing Corporation, was
navigating the waters near Fortune Island in Nasugbu, Batangas on its way to
Navotas, Metro Manila when it collided with the vessel Petroparcel which at the time
was owned by the Luzon Stevedoring Corporation (LSC).
After investigation was conducted by the Board of Marine Inquiry, Philippine Coast
Guard Commandant Simeon N. Alejandro rendered a decision finding
the Petroparcel at fault. Based on this finding by the Board and after unsuccessful
demands on petitioner,7 private respondent sued the LSC and
the Petroparcel captain, Edgardo Doruelo, before the then Court of First Instance of
Caloocan City, paying thereto the docket fee of one thousand two hundred fifty-two
pesos (P1,252.00) and the legal research fee of two pesos (P2.00).8 In particular,
private respondent prayed for an award of P692,680.00, allegedly representing the
value of the fishing nets, boat equipment and cargoes of M/V Maria Efigenia XV, with
interest at the legal rate plus 25% thereof as attorneys fees. Meanwhile, during the
pendency of the case, petitioner PNOC Shipping and Transport Corporation sought to
be substituted in place of LSC as it had already acquired ownership of
the Petroparcel.9cräläwvirtualibräry
For its part, private respondent later sought the amendment of its complaint on the
ground that the original complaint failed to plead for the recovery of the lost value of
the hull of M/V Maria Efigenia XV.10 Accordingly, in the amended complaint, private
respondent averred that M/V Maria Efigenia XV had an actual value of P800,000.00
and that, after deducting the insurance payment of P200,000.00, the amount of
P600,000.00 should likewise be claimed. The amended complaint also alleged that
inflation resulting from the devaluation of the Philippine peso had affected the
replacement value of the hull of the vessel, its equipment and its lost cargoes, such
that there should be a reasonable determination thereof. Furthermore, on account of
the sinking of the vessel, private respondent supposedly incurred unrealized profits
and lost business opportunities that would thereafter be proven. 11cräläwvirtualibräry
Subsequently, the complaint was further amended to include petitioner as a
defendant12 which the lower court granted in its order of September 16, 1985. 13 After
petitioner had filed its answer to the second amended complaint, on February 5,
1987, the lower court issued a pre-trial order14 containing, among other things, a
stipulations of facts, to wit:
1. On 21 September 1977, while the fishing boat `M/V MARIA EFIGENIA
owned by plaintiff was navigating in the vicinity of Fortune Island in
Nasugbu, Batangas, on its way to Navotas, Metro Manila, said fishing boat
was hit by the LSCO tanker Petroparcel causing the former to sink.
2. The Board of Marine Inquiry conducted an investigation of this marine
accident and on 21 November 1978, the Commandant of the Philippine
Coast Guard, the Honorable Simeon N. Alejandro, rendered a decision
finding the cause of the accident to be the reckless and imprudent manner
in which Edgardo Doruelo navigated the LSCO Petroparcel and declared
the latter vessel at fault.
3. On 2 April 1978, defendant Luzon Stevedoring Corporation
(LUSTEVECO), executed in favor of PNOC Shipping and Transport
Corporation a Deed of Transfer involving several tankers, tugboats, barges
and pumping stations, among which was the LSCO Petroparcel.
4. On the same date on 2 April 1979 (sic), defendant PNOC STC again
entered into an Agreement of Transfer with co-defendant Lusteveco
whereby all the business properties and other assets appertaining to the
tanker and bulk oil departments including the motor tanker LSCO
Petroparcel of defendant Lusteveco were sold to PNOC STC.
5. The aforesaid agreement stipulates, among others, that PNOC-STC
assumes, without qualifications, all obligations arising from and by virtue of
all rights it obtained over the LSCO `Petroparcel.
6. On 6 July 1979, another agreement between defendant LUSTEVECO
and PNOC-STC was executed wherein Board of Marine Inquiry Case No.
332 (involving the sea accident of 21 September 1977) was specifically
identified and assumed by the latter.
7. On 23 June 1979, the decision of Board of Marine Inquiry was affirmed
by the Ministry of National Defense, in its decision dismissing the appeal of
Capt. Edgardo Doruelo and Chief mate Anthony Estenzo of LSCO
`Petroparcel.
8. LSCO `Petroparcel is presently owned and operated by PNOC-STC and
likewise Capt. Edgardo Doruelo is still in their employ.
9. As a result of the sinking of M/V Maria Efigenia caused by the reckless
and imprudent manner in which LSCO Petroparcel was navigated by
defendant Doruelo, plaintiff suffered actual damages by the loss of its
 fishing nets, boat equipments (sic) and cargoes, which went down with the
ship when it sank the replacement value of which should be left to the
sound discretion of this Honorable Court.
court15
After trial, the lower rendered on November 18, 1989 its decision disposing of
Civil Case No. C-9457 as follows:
WHEREFORE, and in view of the foregoing, judgment is hereby rendered
in favor of the plaintiff and against the defendant PNOC Shipping &
Transport Corporation, to pay the plaintiff:
a. The sum of P6,438,048.00 representing the value of the fishing boat
with interest from the date of the filing of the complaint at the rate of 6%
per annum;
b. The sum of P50,000.00 as and for attorneys fees; and
c. The costs of suit.
The counterclaim is hereby DISMISSED for lack of merit. Likewise, the
case against defendant Edgardo Doruelo is hereby DISMISSED, for lack of
jurisdiction.
SO ORDERED.
In arriving at the above disposition, the lower court cited the evidence presented by
private respondent consisting of the testimony of its general manager and sole
witness, Edilberto del Rosario. Private respondents witness testified that M/V Maria
Efigenia XV was owned by private respondent per Exhibit A, a certificate of ownership
issued by the Philippine Coast Guard showing that M/V Maria Efigenia XV was a
wooden motor boat constructed in 1965 with 128.23 gross tonnage. According to him,
at the time the vessel sank, it was then carrying 1,060 tubs (baeras) of assorted fish
the value of which was never recovered. Also lost with the vessel were two cummins
engines (250 horsepower), radar, pathometer and compass. He further added that
with the loss of his flagship vessel in his fishing fleet of fourteen (14) vessels, he was
constrained to hire the services of counsel whom he paid P10,000 to handle the case
at the Board of Marine Inquiry and P50,000.00 for commencing suit for damages in
the lower court.
As to the award of P6,438,048.00 in actual damages, the lower court took into
account the following pieces of documentary evidence that private respondent
proffered during trial:
(a) Exhibit A certified xerox copy of the certificate of ownership of M/V
Maria Efigenia XV;
(b) Exhibit B a document titled Marine Protest executed by Delfin
Villarosa, Jr. on September 22, 1977 stating that as a result of
the collision, the M/V Maria Efigenia XV sustained a hole at its
left side that caused it to sink with its cargo of
1,050 baeras valued at P170,000.00;
(c) Exhibit C a quotation for the construction of a 95-footer trawler
issued by Isidoro A. Magalong of I. A. Magalong Engineering
and Construction on January 26, 1987 to Del Rosario showing
that construction of such trawler would cost P2,250,000.00;
(d) Exhibit D pro forma invoice No. PSPI-05/87-NAV issued by E.D.
Daclan of Power Systems, Incorporated on January 20, 1987
to Del Rosario showing that two (2) units of CUMMINS Marine
Engine model N855-M, 195 bhp. at 1800 rpm. would
cost P1,160,000.00;
(e) Exhibit E quotation of prices issued by Scan Marine Inc. on
January 20, 1987 to Del Rosario showing that a unit of Furuno
Compact Daylight Radar, Model FR-604D, would
cost P100,000.00 while a unit of Furuno Color Video Sounder,
Model FCV-501 would cost P45,000.00 so that the two units
would cost P145,000.00;
(f) Exhibit F quotation of prices issued by Seafgear Sales, Inc. on
January 21, 1987 to Del Rosario showing that two (2) rolls of
nylon rope (5 cir. X 300fl.) would cost P140,000.00; two (2)
rolls of nylon rope (3 cir. X 240fl.), P42,750.00; one (1)
binocular (7 x 50), P1,400.00, one (1) compass (6), P4,000.00
and 50 pcs. of floats, P9,000.00 or a total of P197, 150.00;
(g) Exhibit G retainer agreement between Del Rosario and F.
Sumulong Associates Law Offices stipulating an acceptance
fee of P5,000.00, per appearance fee of P400.00, monthly
retainer of P500.00, contingent fee of 20% of the total amount
recovered and that attorneys fee to be awarded by the court
should be given to Del Rosario; and
(h) Exhibit H price quotation issued by Seafgear Sales, Inc. dated
April 10, 1987 to Del Rosario showing the cost of poly nettings
as: 50 rolls of 400/18 3kts. 100md x 100mtrs., P70,000.00; 50
rolls of 400/18 5kts. 100md x 100mtrs., P81,500.00; 50 rolls of
400/18 8kts. 100md x 100mtrs., P116,000.00, and 50 rolls of
400/18 10kts. 100md x 100mtrs., P146,500 and banera (tub)
at P65.00 per piece or a total of P414,065.00
The lower court held that the prevailing replacement value of P6,438,048.00 of the
fishing boat and all its equipment would regularly increase at 30% every year from the
date the quotations were given.
On the other hand, the lower court noted that petitioner only presented Lorenzo
Lazaro, senior estimator at PNOC Dockyard & Engineering Corporation, as sole
witness and it did not bother at all to offer any documentary evidence to support its
position. Lazaro testified that the price quotations submitted by private respondent
were excessive and that as an expert witness, he used the quotations of his suppliers
in making his estimates. However, he failed to present such quotations of prices from
his suppliers, saying that he could not produce a breakdown of the costs of his
estimates as it was a sort of secret scheme. For this reason, the lower court
concluded:
Evidently, the quotation of prices submitted by the plaintiff relative to the
replacement value of the fishing boat and its equipments in the tune
of P6,438,048.00 which were lost due to the recklessness and imprudence
of the herein defendants were not rebutted by the latter with sufficient
evidence. The defendants through their sole witness Lorenzo Lazaro relied
heavily on said witness bare claim that the amount afore-said is excessive
or bloated, but they did not bother at all to present any documentary
evidence to substantiate such claim. Evidence to be believed, must not
only proceed from the mouth of the credible witness, but it must be credible
in itself. (Vda. de Bonifacio vs. B. L. T. Bus Co., Inc. L-26810, August 31,
1970).
Aggrieved, petitioner filed a motion for the reconsideration of the lower courts
decision contending that: (1) the lower court erred in holding it liable for damages;
that the lower court did not acquire jurisdiction over the case by paying
only P1,252.00 as docket fee; (2) assuming that plaintiff was entitled to damages, the
lower court erred in awarding an amount greater than that prayed for in the second
amended complaint; and (3) the lower court erred when it failed to resolve the issues
it had raised in its memorandum.16 Petitioner likewise filed a supplemental motion for
reconsideration expounding on whether the lower court acquired jurisdiction over the
subject matter of the case despite therein plaintiffs failure to pay the prescribed
docket fee.17cräläwvirtualibräry
On January 25, 1990, the lower court declined reconsideration for lack of
merit.18 Apparently not having received the order denying its motion for
reconsideration, petitioner still filed a motion for leave to file a reply to private
respondents opposition to said motion.19 Hence, on February 12, 1990, the lower
court denied said motion for leave to file a reply on the ground that by the issuance of
the order of January 25, 1990, said motion had become moot and
academic.20cräläwvirtualibräry
Unsatisfied with the lower courts decision, petitioner elevated the matter to the Court
of Appeals which, however, affirmed the same in toto on October 14, 1992.21 On
petitioners assertion that the award of P6,438,048.00 was not convincingly proved by
competent and admissible evidence, the Court of Appeals ruled that it was not
necessary to qualify Del Rosario as an expert witness because as the owner of the
lost vessel, it was well within his knowledge and competency to identify and
determine the equipment installed and the cargoes loaded on the vessel. Considering
the documentary evidence presented as in the nature of market reports or quotations,
trade journals, trade circulars and price lists, the Court of Appeals held, thus:
Consequently, until such time as the Supreme Court categorically rules on
the admissibility or inadmissibility of this class of evidence, the reception of
these documentary exhibits (price quotations) as evidence rests on the
sound discretion of the trial court. In fact, where the lower court is
confronted with evidence which appears to be of doubtful admissibility, the
judge should declare in favor of admissibility rather than of non-
admissibility (The Collector of Palakadhari, 124 [1899], p. 43, cited in
Francisco, Revised Rules of Court, Evidence, Volume VII, Part I, 1990
Edition, p. 18). Trial courts are enjoined to observe the strict enforcement of
the rules of evidence which crystallized through constant use and practice
and are very useful and effective aids in the search for truth and for the
effective administration of justice. But in connection with evidence which
may appear to be of doubtful relevancy or incompetency or admissibility, it
is the safest policy to be liberal, not rejecting them on doubtful or technical
grounds, but admitting them unless plainly irrelevant, immaterial or
incompetent, for the reason that their rejection places them beyond the
consideration of the court. If they are thereafter found relevant or
competent, can easily be remedied by completely discarding or ignoring
them. (Banaria vs. Banaria, et al., C.A. No. 4142, May 31, 1950; cited in
Francisco, Supra). [Underscoring supplied].
Stressing that the alleged inadmissible documentary exhibits were never satisfactorily
rebutted by appellants own sole witness in the person of Lorenzo Lazaro, the
appellate court found that petitioner ironically situated itself in an inconsistent posture
by the fact that its own witness, admittedly an expert one, heavily relies on the very
same pieces of evidence (price quotations) appellant has so vigorously objected to as
inadmissible evidence. Hence, it concluded:
x x x. The amount of P6,438,048.00 was duly established at the trial on the
basis of appellees documentary exhibits (price quotations) which stood
uncontroverted, and which already included the amount by way of
adjustment as prayed for in the amended complaint. There was therefore
no need for appellee to amend the second amended complaint in so far as
to the claim for damages is concerned to conform with the evidence
presented at the trial. The amount of P6,438,048.00 awarded is clearly
within the relief prayed for in appellees second amended complaint.
On the issue of lack of jurisdiction, the respondent court held that following the ruling
in Sun Insurance Ltd. v. Asuncion,22 the additional docket fee that may later on be
declared as still owing the court may be enforced as a lien on the judgment.
Hence, the instant recourse.
In assailing the Court of Appeals decision, petitioner posits the view that the award
of P6,438,048 as actual damages should have been in light of these considerations,
namely: (1) the trial court did not base such award on the actual value of the vessel
and its equipment at the time of loss in 1977; (2) there was no evidence on
extraordinary inflation that would warrant an adjustment of the replacement cost of
the lost vessel, equipment and cargo; (3) the value of the lost cargo and the prices
quoted in respondents documentary evidence only amount to P4,336,215.00; (4)
private respondents failure to adduce evidence to support its claim for unrealized
profit and business opportunities; and (5) private respondents failure to prove the
extent and actual value of damages sustained as a result of the 1977 collision of the
vessels.23cräläwvirtualibräry
Under Article 2199 of the Civil Code, actual or compensatory damages are those
awarded in satisfaction of, or in recompense for, loss or injury sustained. They
proceed from a sense of natural justice and are designed to repair the wrong that has
been done, to compensate for the injury inflicted and not to impose a penalty. 24 In
actions based on torts or quasi-delicts, actual damages include all the natural and
probable consequences of the act or omission complained of. 25 There are two kinds
of actual or compensatory damages: one is the loss of what a person already
possesses (dao emergente), and the other is the failure to receive as a benefit that
which would have pertained to him (lucro cesante).26 Thus:
Where goods are destroyed by the wrongful act of the defendant the
plaintiff is entitled to their value at the time of destruction, that is, normally,
the sum of money which he would have to pay in the market for identical or
essentially similar goods, plus in a proper case damages for the loss of use
during the period before replacement. In other words, in the case of profit-
earning chattels, what has to be assessed is the value of the chattel to its
owner as a going concern at the time and place of the loss, and this
means, at least in the case of ships, that regard must be had to existing
and pending engagements.x x x.
x x x. If the market value of the ship reflects the fact that it is in any case
virtually certain of profitable employment, then nothing can be added to that
value in respect of charters actually lost, for to do so would be pro tanto to
compensate the plaintiff twice over. On the other hand, if the ship is valued
without reference to its actual future engagements and only in the light of
its profit-earning potentiality, then it may be necessary to add to the value
thus assessed the anticipated profit on a charter or other engagement
which it was unable to fulfill. What the court has to ascertain in each case is
the `capitalised value of the vessel as a profit-earning machine not in the
abstract but in view of the actual circumstances, without, of course, taking
into account considerations which were too remote at the time of the
loss.27 [Underscoring supplied].
As stated at the outset, to enable an injured party to recover actual or compensatory
damages, he is required to prove the actual amount of loss with reasonable degree of
certainty premised upon competent proof and on the best evidence available. 28 The
burden of proof is on the party who would be defeated if no evidence would be
presented on either side. He must establish his case by a preponderance of evidence
which means that the evidence, as a whole, adduced by one side is superior to that of
the other.29 In other words, damages cannot be presumed and courts, in making an
award must point out specific facts that could afford a basis for measuring whatever
compensatory or actual damages are borne.30cräläwvirtualibräry
In this case, actual damages were proven through the sole testimony of private
respondents general manager and certain pieces of documentary evidence. Except
for Exhibit B where the value of the 1,050 baeras of fish were pegged at their
September 1977 value when the collision happened, the pieces of documentary
evidence proffered by private respondent with respect to items and equipment lost
show similar items and equipment with corresponding prices in early 1987 or
approximately ten (10) years after the collision. Noticeably, petitioner did not object to
the exhibits in terms of the time index for valuation of the lost goods and equipment.
In objecting to the same pieces of evidence, petitioner commented that these were
not duly authenticated and that the witness (Del Rosario) did not have personal
knowledge on the contents of the writings and neither was he an expert on the
subjects thereof.31 Clearly ignoring petitioners objections to the exhibits, the lower
court admitted these pieces of evidence and gave them due weight to arrive at the
award of P6,438,048.00 as actual damages.
The exhibits were presented ostensibly in the course of Del Rosarios testimony.
Private respondent did not present any other witnesses especially those whose
signatures appear in the price quotations that became the bases of the award. We
hold, however, that the price quotations are ordinary private writings which under the
Revised Rules of Court should have been proffered along with the testimony of the
authors thereof. Del Rosario could not have testified on the veracity of the contents of
the writings even though he was the seasoned owner of a fishing fleet because he
was not the one who issued the price quotations. Section 36, Rule 130 of the Revised
Rules of Court provides that a witness can testify only to those facts that he knows of
his personal knowledge.
For this reason, Del Rosarios claim that private respondent incurred losses in the total
amount of P6,438,048.00 should be admitted with extreme caution considering that,
because it was a bare assertion, it should be supported by independent evidence.
Moreover, because he was the owner of private respondent corporation 32 whatever
testimony he would give with regard to the value of the lost vessel, its equipment and
cargoes should be viewed in the light of his self-interest therein. We agree with the
Court of Appeals that his testimony as to the equipment installed and the cargoes
loaded on the vessel should be given credence33 considering his familiarity thereto.
However, we do not subscribe to the conclusion that his valuation of such
equipment, cargo and the vessel itself should be accepted as gospel truth. 34 We
must, therefore, examine the documentary evidence presented to support Del
Rosarios claim as regards the amount of losses.
The price quotations presented as exhibits partake of the nature of hearsay evidence
considering that the persons who issued them were not presented as
witnesses.35 Any evidence, whether oral or documentary, is hearsay if its probative
value is not based on the personal knowledge of the witness but on the knowledge of
another person who is not on the witness stand. Hearsay evidence, whether objected
to or not, has no probative value unless the proponent can show that the evidence
falls within the exceptions to the hearsay evidence rule. 36 On this point, we believe
that the exhibits do not fall under any of the exceptions provided under Sections 37 to
47 of Rule 130.37chanroblesvirtuallawlibrary
It is true that one of the exceptions to the hearsay rule pertains to commercial lists
and the like under Section 45, Rule 130 of the Revised Rules on Evidence. In this
respect, the Court of Appeals considered private respondents exhibits as commercial
lists. It added, however, that these exhibits should be admitted in evidence until such
time as the Supreme Court categorically rules on the admissibility or inadmissibility of
this class of evidence because the reception of these documentary exhibits (price
quotations) as evidence rests on the sound discretion of the trial court.38 Reference to
Section 45, Rule 130, however, would show that the conclusion of the Court of
Appeals on the matter was arbitrarily arrived at. This rule states:
 Commercial lists and the like. Evidence of statements of matters of interest coupled with Twin-Disc Marine gearbox model MG-
to persons engaged in an occupation contained in a list, register, periodical, 509, 4.5:1 reduction ratio, includes oil cooler,
or other published compilation is admissible as tending to prove the truth of companion flange, manual and standard
any relevant matter so stated if that compilation is published for use by accessories as per attached sheet.
persons engaged in that occupation and is generally used and relied upon
by them there. Price FOB Manila - - - - - - - - - - - - - -
- P 580,000.00/unit
Total FOB Manila - - - - - - - - - - - - - -
Under Section 45 of the aforesaid Rule, a document is a commercial list if: (1) it is a - P 1,160,000.00
statement of matters of interest to persons engaged in an occupation; (2) such vvvvvvvvv
statement is contained in a list, register, periodical or other published compilation; (3)
said compilation is published for the use of persons engaged in that occupation, and
(4) it is generally used and relied upon by persons in the same occupation. T E R M S : CASH

Based on the above requisites, it is our considered view that Exhibits B, C, D, E, F DELIVERY : 60-90 days from date of order.
and H39 are not commercial lists for these do not belong to the category of other
published compilations under Section 45 aforequoted. Under the principle of ejusdem VALIDITY : Subject to our final confirmation.
generis, (w)here general words follow an enumeration of persons or things, by words
of a particular and specific meaning, such general words are not to be construed in WARRANTY : One (1) full year against factory defect.
their widest extent, but are to be held as applying only to persons or things of the
same kind or class as those specifically mentioned.40 The exhibits mentioned are
mere price quotations issued personally to Del Rosario who requested for them from Very
dealers of equipment similar to the ones lost at the collision of the two vessels. These truly
are not published in any list, register, periodical or other compilation on the relevant yours,
subject matter. Neither are these market reports or quotations within the purview of
commercial lists as these are not standard handbooks or periodicals, containing data POWER
of everyday professional need and relied upon in the work of the occupation. 41 These S
are simply letters responding to the queries of Del Rosario. Thus, take for example Y
Exhibit D which reads: S
T
January 20, 1987 E
M
S
PROFORMA INVOICE NO. PSPI-05/87-NAV ,
I
MARIA EFIGINIA FISHING CORPORATION N
C
Navotas, Metro Manila .

Attention: MR. EDDIE DEL ROSARIO (Sgd.)

E. D.
D
Gentlemen: a
c
In accordance to your request, we are pleased to quote our Cummins Marine Engine, l
to wit. a
n
Two (2) units CUMMINS Marine Engine model N855-M, 195 bhp.
at 1800 rpm., 6-cylinder in-line, 4-stroke cycle, To be sure, letters and telegrams are admissible in evidence but these are, however,
natural aspirated, 5 in. x 6 in. bore and stroke, 855 subject to the general principles of evidence and to various rules relating to
cu. In. displacement, keel-cooled, electric starting documentary evidence.42 Hence, in one case, it was held that a letter from an
automobile dealer offering an allowance for an automobile upon purchase of a new
automobile after repairs had been completed, was not a price current or commercial
list within the statute which made such items presumptive evidence of the value of the
article specified therein. The letter was not admissible in evidence as a commercial
list even though the clerk of the dealer testified that he had written the letter in due
course of business upon instructions of the dealer.43cräläwvirtualibräry
But even on the theory that the Court of Appeals correctly ruled on
the admissibility of those letters or communications when it held that unless plainly
irrelevant, immaterial or incompetent, evidence should better be admitted rather than
rejected on doubtful or technical grounds,44 the same pieces of evidence, however,
should not have been given probative weight. This is a distinction we wish to point
out. Admissibility of evidence refers to the question of whether or not the
circumstance (or evidence) is to considered at all.45 On the other hand, the probative
value of evidence refers to the question of whether or not it proves an issue. 46 Thus, a
letter may be offered in evidence and admitted as such but its evidentiary weight
depends upon the observance of the rules on evidence. Accordingly, the author of the
letter should be presented as witness to provide the other party to the litigation the
opportunity to question him on the contents of the letter. Being mere hearsay
evidence, failure to present the author of the letter renders its contents suspect. As
earlier stated, hearsay evidence, whether objected to or not, has no probative value.
Thus:
The courts differ as to the weight to be given to hearsay evidence admitted
without objection. Some hold that when hearsay has been admitted without
objection, the same may be considered as any other properly admitted
testimony. Others maintain that it is entitled to no more consideration than if
it had been excluded.
The rule prevailing in this jurisdiction is the latter one. Our Supreme Court
held that although the question of admissibility of evidence can not be
raised for the first time on appeal, yet if the evidence is hearsay it has no
probative value and should be disregarded whether objected to or not. `If
no objection is made quoting Jones on Evidence - `it (hearsay) becomes
evidence by reason of the want of such objection even though its
admission does not confer upon it any new attribute in point of weight. Its
nature and quality remain the same, so far as its intrinsic weakness and
incompetency to satisfy the mind are concerned, and as opposed to direct
primary evidence, the latter always prevails.
The failure of the defense counsel to object to the presentation of
incompetent evidence, like hearsay evidence or evidence that violates the
rules of res inter alios acta, or his failure to ask for the striking out of the
same does not give such evidence any probative value. But admissibility of
evidence should not be equated with weight of evidence. Hearsay evidence
whether objected to or not has no probative value.47cräläwvirtualibräry
Accordingly, as stated at the outset, damages may not be awarded on the basis of
hearsay evidence.48cräläwvirtualibräry
Nonetheless, the non-admissibility of said exhibits does not mean that it totally
deprives private respondent of any redress for the loss of its vessel. This is because
in Lufthansa German Airlines v. Court of Appeals,49 the Court said:
In the absence of competent proof on the actual damage suffered, private
respondent is `entitled to nominal damages which, as the law says, is
adjudicated in order that a right of the plaintiff, which has been violated or
invaded by defendant, may be vindicated and recognized, and not for the
purpose of indemnifying the plaintiff for any loss suffered. [Underscoring
supplied].
Nominal damages are awarded in every obligation arising from law, contracts, quasi-
contracts, acts or omissions punished by law, and quasi-delicts, or in every case
where property right has been invaded.50 Under Article 2223 of the Civil Code, (t)he
adjudication of nominal damages shall preclude further contest upon the right
involved and all accessory questions, as between the parties to the suit, or their
respective heirs and assigns.
Actually, nominal damages are damages in name only and not in fact. Where these
are allowed, they are not treated as an equivalent of a wrong inflicted but simply in
recognition of the existence of a technical injury.51 However, the amount to be
awarded as nominal damages shall be equal or at least commensurate to the injury
sustained by private respondent considering the concept and purpose of such
damages.52 The amount of nominal damages to be awarded may also depend on
certain special reasons extant in the case.53cräläwvirtualibräry
Applying now such principles to the instant case, we have on record the fact that
petitioners vessel Petroparcel was at fault as well as private respondents complaint
claiming the amount of P692,680.00 representing the fishing nets, boat equipment
and cargoes that sunk with the M/V Maria Efigenia XV. In its amended complaint,
private respondent alleged that the vessel had an actual value of P800,000.00 but it
had been paid insurance in the amount of P200,000.00 and, therefore, it claimed only
the amount of P600,000.00. Ordinarily, the receipt of insurance payments should
diminish the total value of the vessel quoted by private respondent in his complaint
considering that such payment is causally related to the loss for which it claimed
compensation. This Court believes that such allegations in the original and amended
complaints can be the basis for determination of a fair amount of nominal damages
inasmuch as a complaint alleges the ultimate facts constituting the plaintiff's cause of
action.54 Private respondent should be bound by its allegations on the amount of its
claims.
With respect to petitioners contention that the lower court did not acquire jurisdiction
over the amended complaint increasing the amount of damages claimed
to P600,000.00, we agree with the Court of Appeals that the lower court acquired
jurisdiction over the case when private respondent paid the docket fee corresponding
to its claim in its original complaint. Its failure to pay the docket fee corresponding to
its increased claim for damages under the amended complaint should not be
considered as having curtailed the lower courts jurisdiction. Pursuant to the ruling
in Sun Insurance Office, Ltd. (SIOL) v. Asuncion,55 the unpaid docket fee should
be considered as a lien on the judgment even though private respondent specified the
amount of P600,000.00 as its claim for damages in its amended complaint.

Moreover, we note that petitioner did not question at all the jurisdiction of the lower
court on the ground of insufficient docket fees in its answers to both the amended
complaint and the second amended complaint. It did so only in its motion for
reconsideration of the decision of the lower court after it had received an adverse
decision. As this Court held in Pantranco North Express, Inc. v. Court of
Appeals,56 participation in all stages of the case before the trial court, that included
invoking its authority in asking for affirmative relief, effectively barred petitioner by
estoppel from challenging the courts jurisdiction. Notably, from the time it filed its
answer to the second amended complaint on April 16, 1985, 57 petitioner did not
question the lower courts jurisdiction. It was only on December 29, 1989 58 when it
filed its motion for reconsideration of the lower courts decision that petitioner raised
the question of the lower courts lack of jurisdiction. Petitioner thus foreclosed its right
to raise the issue of jurisdiction by its own inaction.

WHEREFORE, the challenged decision of the Court of Appeals dated October 14,
1992 in CA-G. R. CV No. 26680 affirming that of the Regional Trial Court of Caloocan
City, Branch 121, is hereby MODIFIED insofar as it awarded actual damages to
private respondent Maria Efigenia Fishing Corporation in the amount
of P6,438,048.00 for lack of evidentiary bases therefor. Considering the fact,
however, that: (1) technically petitioner sustained injury but which, unfortunately, was
not adequately and properly proved, and (2) this case has dragged on for almost two
decades, we believe that an award of Two Million (P2,000,000.00)59 in favor of private
respondent as and for nominal damages is in order.

No pronouncement as to costs.

SO ORDERED.
 [G.R. NO. 165969 : November 27, 2008]
NATIONAL POWER CORPORATION, Petitioner, v. HEIRS OF NOBLE
CASIONAN, Respondents.
DECISION
REYES, R.T., J.:
PETITIONING power company pleads for mitigation of awarded damages on ground
of contributory negligence. But is the victim in this case partly to blame for his
electrocution and eventual demise?cralawred
This is a review on certiorari of the Decision1 of the Court of Appeals (CA) which
found the National Power Corporation (NPC) liable for damages for the death of
Noble Casionan due to electrocution from the company's high tension transmission
lines.
The Facts
The facts, as found by the trial court are as follows:
Respondents are the parents of Noble Casionan, 19 years old at the time of the
incident that claimed his life on June 27, 1995. He would have turned 20 years of age
on November 9 of that year. Noble was originally from Cervantes, Ilocos Sur. He
worked as a pocket miner in Dalicno, Ampucao, Itogon, Benguet.
A trail leading to Sangilo, Itogon, existed in Dalicno and this trail was regularly used
by members of the community. Sometime in the 1970's, petitioner NPC installed high-
tension electrical transmission lines of 69 kilovolts (KV) traversing the trail. Eventually,
some of the transmission lines sagged and dangled reducing their distance from the
ground to only about eight to ten feet. This posed a great threat to passersby who
were exposed to the danger of electrocution especially during the wet season.
As early as 1991, the leaders of Ampucao, Itogon made verbal and written requests
for NPC to institute safety measures to protect users of the trail from their high
tension wires. On June 18, 1991 and February 11, 1993, Pablo and Pedro Ngaosie,
elders of the community, wrote Engr. Paterno Banayot, Area Manager of NPC, to
make immediate and appropriate repairs of the high tension wires. They reiterated the
danger it posed to small-scale miners especially during the wet season. They related
an incident where one boy was nearly electrocuted.
In a letter dated March 1, 1995, Engr. Banayot informed Itogon Mayor Cresencio
Pacalso that NPC had installed nine additional poles on their Beckel-Philex 60 KV
line. They likewise identified a possible rerouting scheme with an estimated total cost
of 1.7 million pesos to improve the distance from its deteriorating lines to the ground.
On June 27, 1995, Noble and his co-pocket miner, Melchor Jimenez, were at Dalicno.
They cut two bamboo poles for their pocket mining. One was 18 to 19 feet long and
the other was 14 feet long. Each man carried one pole horizontally on his shoulder:
Noble carried the shorter pole while Melchor carried the longer pole. Noble walked
ahead as both passed through the trail underneath the NPC high tension
transmission lines on their way to their work place.
As Noble was going uphill and turning left on a curve, the tip of the bamboo pole he
was carrying touched one of the dangling high tension wires. Melchor, who was
walking behind him, narrated that he heard a buzzing sound when the tip of Noble's
pole touched the wire for only about one or two seconds. Thereafter, he saw Noble
fall to the ground. Melchor rushed to Noble and shook him but the latter was already
dead. Their co-workers heard Melchor's shout for help and together they brought the
body of Noble to their camp.
A post-mortem examination by Dra. Ignacia Reyes Ciriaco, Municipal Health Officer
of Itogon, Benguet, determined the cause of death to be cardiac arrest, secondary to
ventricular fibulation, secondary to electrocution.2 She also observed a small burned
area in the middle right finger of the victim.
Police investigators who visited the site of the incident confirmed that portions of the
high tension wires above the trail hung very low, just about eight to ten feet above the
ground. They noted that the residents, school children, and pocket miners usually
used the trail and had to pass directly underneath the wires. The trail was the only
viable way since the other side was a precipice. In addition, they did not see any
danger warning signs installed in the trail.
The elders and leaders of the community, through Mayor Cresencio Pacalso,
informed the General Manager of NPC in Itogon of the incident. After learning of the
electrocution, NPC repaired the dangling and sagging transmission lines and put up
warning signs around the area.
Consequently, the heirs of the deceased Noble filed a claim for damages against the
NPC before the Regional Trial Court (RTC) in Benguet. In its answer, NPC denied
being negligent in maintaining the safety of the high tension transmission lines. It
averred that there were danger and warning signs installed but these were stolen by
children. Excavations were also made to increase the necessary clearance from the
ground to about 17 to 18 feet but some towers or poles sank due to pocket mining in
the area.
At the trial, NPC witnesses testified that the cause of death could not have been
electrocution because the victim did not suffer extensive burns despite the strong 69
KV carried by the transmission lines. NPC argued that if Noble did die by
electrocution, it was due to his own negligence. The company counter-claimed for
attorney's fees and cost of litigation.
RTC Disposition
On February 17, 1998, the RTC decided in favor of respondents. The fallo of its
decision reads:
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against the
defendant NPC as follows:
1. Declaring defendant NPC guilty of Negligence (Quasi-Delict) in connection with the
death of Noble Casionan;
2. Ordering NPC as a consequence of its negligence, to pay the plaintiffs Jose and
Linda Casionan, as heirs of the deceased, Noble Casionan, the following Damages:
A. P50,000.00 as indemnity for the death of their son Noble Casionan;
b. P100,000.00 as moral damages;
c. P50,000.00 as exemplary damages;
d. P52,277.50 as actual damages incurred for the expenses of burial and wake in
connection with the death of Noble Casionan;
e. P720,000.00 as the loss of unearned income; andcralawlibrary
f. P20,000.00 as attorney's fees and the cost of suit; and
3. Dismissing the counter claim of the NPC for lack of merit.3
The RTC gave more credence to the testimony of witnesses for respondents than
those of NPC who were not actually present at the time of the incident. The trial court
observed that witnesses for NPC were biased witnesses because they were all
employed by the company, except for the witness from the Department of
Environment and Natural Resources (DENR). The RTC found:
Melchor Jimenez was very vivid in his account. He declared that he and Noble
Casionan cut two bamboo poles, one 14 feet and the other about 18 feet. The shorter
bamboo pole was carried by Noble Casionan and the longer bamboo pole was
carried by him. And they walked along the trail underneath the transmission lines. He
was following Noble Casionan. And when they were going uphill in the trail and Noble
Casionan was to turn left in a curve, the bamboo pole of Casionan swung around and
its tip at the back touched for one or two seconds or for a split moment the
transmission line that was dangling and a buzzing sound was heard. And Casionan
immediately fell dead and simply stopped breathing. What better account would there
be than this? Melchor Jimenez was an eye witness as to how it all
happened.4 (Emphasis added)
The RTC ruled that the negligence of NPC in maintaining the high-tension wires was
established by preponderance of evidence. On this score, the RTC opined:
2. On the matter of whether plaintiffs have a cause of action against defendant NPC,
obviously, they would have. x x x This negligence of the NPC was well established
and cannot be denied because previous to this incident, the attention of NPC has
already been called by several requests and demands in 1991, 1993 and 1995 by
elders and leaders of the community in the area to the fact that their transmission
lines were dangling and sagging and the clearance thereof from the line to the ground
was only 8 to 10 feet and not within the standard clearance of 18 to 20 feet but no
safety measures were taken. They did not even put danger and warning signs so as
to warn persons passing underneath.5 (Emphasis added)
Disagreeing with the ruling of the trial court, NPC elevated the case to the CA. In its
appeal, it argued that the RTC erred in ruling that NPC was liable for Noble's death.
Further, even assuming that Noble died of electrocution, the RTC erred in not finding
that he was guilty of contributory negligence and in awarding excessive damages.
CA Disposition
On June 30, 2004, the CA promulgated its decision, disposing as follows:
WHEREFORE, the appealed Decision is hereby AFFIRMED, with the
MODIFICATION that the amount of moral damages is REDUCED to Fifty Thousand
Pesos (P50,000.00); and the award of attorney's fees in the sum of Twenty Thousand
Pesos (P20,000.00) is DELETED.6
The CA sustained the findings of fact of the trial court but reduced the award of moral
damages from P100,000.00 to P50,000.00. The CA further disallowed the award of
attorney's fees because the reason for the award was not expressly stated in the
body of the decision.
Issues
The following issues are presented for Our consideration: (i) Whether the award for
damages should be deleted in view of the contributory negligence of the victim; and
(ii) Whether the award for unearned income, exemplary, and moral damages should
be deleted for lack of factual and legal bases.7
Our Ruling
I
That the victim Noble died from being electrocuted by the high-tension transmission
wires of petitioner is not contested by petitioner. We are, however, asked to delete or
mitigate the damages awarded by the trial and appellate courts in view of what
petitioner alleges to be contributory negligence on the part of the victim.
As a rule, only questions of law may be entertained on appeal by certiorari under Rule
45. The finding of negligence on the part of petitioner by the trial court and affirmed by
the CA is a question of fact which We cannot pass upon since it would entail going
into factual matters on which the finding of negligence was based. 8 Corollary to this,
the finding by both courts of the lack of contributory negligence on the part of the
victim is a factual issue which is deemed conclusive upon this Court absent any
compelling reason for Us to rule otherwise.
But even if We walk the extra mile, the finding of liability on the part of
petitioner must stay.
Petitioner contends that the mere presence of the high tension wires above the trail
did not cause the victim's death. Instead, it was Noble's negligent carrying of the
bamboo pole that caused his death. It insists that Noble was negligent when he
allowed the bamboo pole he was carrying to touch the high tension wires. This is
especially true because other people traversing the trail have not been similarly
electrocuted.
Petitioner's contentions are absurd.
The sagging high tension wires were an accident waiting to happen. As established
during trial, the lines were sagging around 8 to 10 feet in violation of the required
distance of 18 to 20 feet. If the transmission lines were properly maintained by
petitioner, the bamboo pole carried by Noble would not have touched the wires. He
would not have been electrocuted.
Petitioner cannot excuse itself from its failure to properly maintain the wires by
attributing negligence to the victim. In Ma-ao Sugar Central Co., Inc. v. Court of
Appeals,9 this Court held that the responsibility of maintaining the rails for the purpose
of preventing derailment accidents belonged to the company. The company should
not have been negligent in ascertaining that the rails were fully connected than to wait
until a life was lost due to an accident. Said the Court:
In this petition, the respondent court is faulted for finding the petitioner guilty of
negligence notwithstanding its defense of due diligence under Article 2176 of the Civil
Code and for disallowing the deductions made by the trial court.
Investigation of the accident revealed that the derailment of the locomotive was
caused by protruding rails which had come loose because they were not connected
and fixed in place by fish plates. Fish plates are described as strips of iron 8" to 12"
long and 3 '" thick which are attached to the rails by 4 bolts, two on each side, to keep
the rails aligned. Although they could be removed only with special equipment, the
fish plates that should have kept the rails aligned could not be found at the scene of
the accident.
There is no question that the maintenance of the rails, for the purpose, inter alia, of
preventing derailments, was the responsibility of the petitioner, and that this
responsibility was not discharged. According to Jose Reyes, its own witness, who
was in charge of the control and supervision of its train operations, cases of
derailment in the milling district were frequent and there were even times when such
derailments were reported every hour. The petitioner should therefore have taken
more prudent steps to prevent such accidents instead of waiting until a life was finally
lost because of its negligence.10
Moreover, We find no contributory negligence on Noble's part.
Negligence is the failure to observe, for the protection of the interest of another
person, that degree of care, precaution, and vigilance which the circumstances justly
demand, whereby such other person suffers injury.11 On the other hand, contributory
negligence is conduct on the part of the injured party, contributing as a legal
cause to the harm he has suffered, which falls below the standard which he is
required to conform for his own protection.12 There is contributory negligence
when the party's act showed lack of ordinary care and foresight that such act could
cause him harm or put his life in danger.13 It is an act or omission amounting to want
of ordinary care on the part of the person injured which, concurring with the
defendant's negligence, is the proximate cause of the injury. 14
The underlying precept on contributory negligence is that a plaintiff who is partly
responsible for his own injury should not be entitled to recover damages in full but
must bear the consequences of his own negligence.15 If indeed there was contributory
negligence on the part of the victim, then it is proper to reduce the award for
damages. This is in consonance with the Civil Code provision that liability will be
mitigated in consideration of the contributory negligence of the injured party. Article
2179 of the Civil Code is explicit on this score:
When the plaintiff's own negligence was the immediate and proximate cause of his
injury, he cannot recover damages. But if his negligence was only contributory, the
immediate and proximate cause of the injury being the defendant's lack of due care,
the plaintiff may recover damages, but the courts shall mitigate the damages to be
awarded.
In Ma-ao Sugar Central, it was held that to hold a person as having contributed to his
injuries, it must be shown that he performed an act that brought about his injuries in
disregard of warnings or signs on an impending danger to health and body. This
Court held then that the victim was not guilty of contributory negligence as there was
no showing that the caboose where he was riding was a dangerous place and that he
recklessly dared to stay there despite warnings or signs of impending danger.16
In this case, the trail where Noble was electrocuted was regularly used by members
of the community. There were no warning signs to inform passersby of the impending
danger to their lives should they accidentally touch the high tension wires. Also, the
trail was the only viable way from Dalicon to Itogon. Hence, Noble should not be
faulted for simply doing what was ordinary routine to other workers in the area.
Petitioner further faults the victim in engaging in pocket mining, which is prohibited by
the DENR in the area.
In Añonuevo v. Court of Appeals,17 this Court ruled that the violation of a statute is
not sufficient to hold that the violation was the proximate cause of the injury, unless
the very injury that happened was precisely what was intended to be prevented by the
statute. In said case, the allegation of contributory negligence on the part of the
injured party who violated traffic regulations when he failed to register his bicycle or
install safety gadgets thereon was struck down. We quote:
x x x The bare fact that Villagracia was violating a municipal ordinance at the time of
the accident may have sufficiently established some degree of negligence on his part,
but such negligence is without legal consequence unless it is shown that it was a
contributing cause of the injury. If anything at all, it is but indicative of Villagracia's
failure in fulfilling his obligation to the municipal government, which would then be the
proper party to initiate corrective action as a result. But such failure alone is not
determinative of Villagracia's negligence in relation to the accident. Negligence is
relative or comparative, dependent upon the situation of the parties and the degree of
care and vigilance which the particular circumstances reasonably require. To
determine if Villagracia was negligent, it is not sufficient to rely solely on the violations
of the municipal ordinance, but imperative to examine Villagracia's behavior in relation
to the contemporaneous circumstances of the accident.
xxx
Under American case law, the failures imputed on Villagracia are not grievous
enough so as to negate monetary relief. In the absence of statutory requirement, one
is not negligent as a matter of law for failing to equip a horn, bell, or other warning
devise onto a bicycle. In most cases, the absence of proper lights on a bicycle does
not constitute negligence as a matter of law but is a question for the jury whether the
absence of proper lights played a causal part in producing a collision with a
motorist. The absence of proper lights on a bicycle at night, as required by statute or
ordinance, may constitute negligence barring or diminishing recovery if the bicyclist is
struck by a motorist as long as the absence of such lights was a proximate cause of
the collision; however, the absence of such lights will not preclude or diminish
recovery if the scene of the accident was well illuminated by street lights, if substitute
lights were present which clearly rendered the bicyclist visible, if the motorist saw the
bicycle in spite of the absence of lights thereon, or if the motorist would have been
unable to see the bicycle even if it had been equipped with lights. A bicycle equipped
with defective or ineffective brakes may support a finding of negligence barring or
diminishing recovery by an injured bicyclist where such condition was a contributing
cause of the accident.
The above doctrines reveal a common thread. The failure of the bicycle owner to
comply with accepted safety practices, whether or not imposed by ordinance or
statute, is not sufficient to negate or mitigate recovery unless a causal connection is
established between such failure and the injury sustained. The principle likewise finds
affirmation in Sanitary Steam, wherein we declared that the violation of a traffic
statute must be shown as the proximate cause of the injury, or that it substantially
contributed thereto. Añonuevo had the burden of clearly proving that the alleged
negligence of Villagracia was the proximate or contributory cause of the latter's
injury.18 (Emphasis added)
That the pocket miners were unlicensed was not a justification for petitioner to leave
their transmission lines dangling. We quote with approval the observation of the RTC
on this matter:
The claim of NPC that the pocket miners have no right to operate within the area of
Dalicno, Itogon, Benguet as there was no permit issued by DENR is beside the point.
The fact is that there were not only pocket miners but also there were many residents
in the area of Dalicno, Ampucao, Itogon, Benguet using the trail. These residents
were using this trail underneath the transmission lines x x x. They were using this trail
even before the transmission lines were installed in the 1970's by NPC. The pocket
miners, although they have no permit to do pocket mining in the area, are also human
beings who have to eke out a living in the only way they know how. The fact that they
were not issued a permit by the DENR to do pocket mining is no justification for NPC
to simply leave their transmission lines dangling or hanging 8 to 10 feet above the
ground posing danger to the life and limb of everyone in said community. x x
x19 (Emphasis added)
In sum, the victim was not guilty of contributory negligence. Hence, petitioner is not
entitled to a mitigation of its liability.
II
We now determine the propriety of the awards for loss of unearned income,
moral, and exemplary damages.
From the testimony of the victim's mother, it was duly established during trial that he
was earning P3,000.00 a month. To determine the compensable amount of lost
earnings, We consider (1) the number of years for which the victim would otherwise
have lived (life expectancy); and (2) the rate of loss sustained by the heirs of the
deceased. Life expectancy is computed by applying the formula (2/3 x [80 - age at
death]) adopted in the American Expectancy Table of Mortality or the Actuarial
Combined Experience Table of Mortality. The second factor is computed by
multiplying the life expectancy by the net earnings of the deceased, i.e., the total
earnings less expenses necessary in the creation of such earnings or income and
less living and other incidental expenses. The net earning is ordinarily computed at
fifty percent (50%) of the gross earnings. Thus, the formula used by this Court in
computing loss of earning capacity is: Net Earning Capacity = [2/3 x (80 - age at time
of death) x (gross annual income - reasonable and necessary living expenses)].20
We sustain the trial court computation of unearned income of the victim:
x x x the loss of his unearned income can be computed as follows: two-thirds of 80
years, minus 20 years, times P36,000.00 per year, equals P1,440,000.00. This is
because Noble Casionan, at the time of his death, was 20 years old and was healthy
and strong. And, therefore, his life expectancy would normally reach up to 80 years
old in accordance with the above formula illustrated in the aforesaid cases. Thus,
Noble Casionan had 60 more years life expectancy since he was 20 years old at the
time of his death on June 27, 1995. Two-thirds of 60 years times P36,000.00 since he
was earning about P3,000.00 a month of P36,000.00 a year would be P1,440,000.00.
However, in determining the unearned income, the basic concern is to determine the
damages sustained by the heirs or dependents of the deceased Casionan. And here,
the damages consist not of the full amount of his earnings but the support they would
have received from the deceased had he not died as a consequence of the unlawful
act of the NPC. x x x The amount recoverable is not the loss of the entire earnings but
the loss of that portion of the earnings which the heirs would have received as
support. Hence, from the amount of P1,440,000.00, a reasonable amount for the
necessary expenses of Noble Casionan had he lived would be deducted. Following
the ruling in People v. Quilaton, 205 SCRA 279, the Court deems that 50 percent of
the gross earnings of the deceased of P1,440,000.00 should be deducted for his
necessary expenses had he lived, thus leaving the other half of about P720,000.00 as
the net earnings that would have gone for the support of his heirs. This is the
unearned income of which the heirs were deprived of. 21

In quasi delicts, exemplary damages are awarded where the offender was guilty of
gross negligence.22 Gross negligence has been defined to be the want or absence of
even slight care or diligence as to amount to a reckless disregard of the safety of
person or property. It evinces a thoughtless disregard of consequences without
exerting any effort to avoid them.23

Petitioner demonstrated its disregard for the safety of the members of the community
of Dalicno who used the trail regularly when it failed to address the sagging high
tension wires despite numerous previous requests and warnings. It only exerted
efforts to rectify the danger it posed after a death from electrocution already occurred.
Gross negligence was thus apparent, warranting the award of exemplary damages.

As to the award of moral damages, We sustain the CA reduction of the award. Moral
damages are designed to compensate the claimant for actual injury suffered and not
to impose a penalty on the wrongdoer. It is not meant to enrich the complainant but to
enable the injured party to obtain means to obviate the moral suffering experience.
Trial courts should guard against the award of exorbitant damages lest they be
accused of prejudice or corruption in their decision making.24 We find that the CA
correctly reduced the award from P100,000.00 to P50,000.00.

As for the award for attorney's fees, well-settled is the rule that the reason for the
award must be discussed in the text of the court's decision and not only in the
dispositive portion.25 Except for the fallo, a discussion on the reason for the award for
attorney's fees was not included by the RTC in its decision. The CA thus correctly
disallowed it on appeal.

WHREFORE, the petition is DENIED and the appealed decision of the Court of
Appeals AFFIRMED.

SO ORDERED.
 G.R. No. 117572. January 29, 1998
GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS), Petitioner, v. THE HON.
COURT OF APPEALS and ROSA BALAIS, Respondents.
DECISION
ROMERO, J.:
This is a petition for review on certiorari seeking to annul and set aside the
decision1 rendered by the Court of Appeals dated October 17, 1994 which reversed
the decision issued by the Employees Compensation Commission (ECC) in ECC
Case No. 6462 dated November 17, 1993, affirming the decision of petitioner
Government Service Insurance System (GSIS) that private respondent Rosa Balais is
not entitled to conversion of compensation benefits from partial disability for a 9-
month period after retirement to total disability.
Private respondent started working as an emergency employee of the National
Housing Authority (NHA) in 1952. She then rose from the ranks until she was
promoted to Chief Paying Cashier in 1984.2cräläwvirtualibräry
Medical records disclose that on December 17, 1989, private respondent suddenly
experienced chills, followed by loss of consciousness. She was brought to the Capitol
Medical Center where she was sedated but allowed to go home after three hours.
Later, on the same day, however, she vomited several times and suffered from parie-
occipital pains. She was again rushed to U.E.R.M. Medical Center where she
underwent a thorough medical examination. She was diagnosed to be suffering from
Subarachnoid Hemorrhage Secondary to Ruptured Aneurysm. After undergoing
craniotomy, she was finally discharged from the hospital on January 20,
1990.3cräläwvirtualibräry
Despite her operation, private respondent could not perform her duties as efficiently
as she had done prior to her illness. This forced her to retire early from the
government service on March 1, 1990 at the age of sixty-two (62)
years.4cräläwvirtualibräry
On March 13, 1990, private respondent filed a claim for disability benefits with the
GSIS for the above-described ailment. Her illness was evaluated as compensable by
the GSIS Medical Evaluation and Underwriting Group. Accordingly, the GSIS granted
her temporary total disability (TTD) benefits for the period starting from December 17,
1989 to January 31, 1990 and subsequently, permanent partial disability (PPD)
benefits for nine months starting on March 2, 1990.5cräläwvirtualibräry
In a letter dated November 17, 1992, private respondent requested the GSIS for the
conversion of the classification of her disability benefits from permanent partial
disability (PPD) to permanent total disability (PTD).6cräläwvirtualibräry
Such plea, however, was denied by the GSIS in a letter dated December 8, 1992 on
the ground that the GSIS Medical Evaluation and Underwriting Department which
evaluated her claim found no basis to alter its findings. She was informed that the
results of the physical examination conducted on June 5, 1990 did not satisfy the
criteria for permanent total disability. Moreover, she was told that the pension granted
to her was the maximum benefit due her under the Rating Schedule established by
the ECC.7cräläwvirtualibräry
The denial of her request then prompted private respondent to file on May 4, 1993 a
request for reconsideration of the earlier denial of her application for the conversion of
her disability benefits from permanent partial disability to permanent total disability,
explaining that since the time of her operation she continued to suffer from dizziness,
headaches, loss of memory and inability to properly sleep. Moreover, she contended
that there were instances when she felt extremely weak and could not walk without
support. She further stated that she was required to take medication for
life.8cräläwvirtualibräry
The GSIS, however, denied reconsideration which denial was later affirmed on
appeal by the ECC in its decision dated November 17, 1993.9cräläwvirtualibräry
Undaunted, private respondent filed a petition for review with the Court of Appeals,
which promulgated a decision favorable to her on October 17, 1994, the dispositive
portion of which reads:
WHEREFORE, this petition for review is granted and the decision of the Employees
Compensation Commission in ECC Case 6462 dated 17 November 1993 should be,
as it is hereby REVERSED.10cräläwvirtualibräry
Petitioner GSIS now comes to this Court by way of a petition for review
on certiorari alleging that the Court of Appeals erred:
1. In reversing and setting aside the decision of the Employees Compensation
Commission which affirmed the decision of herein petitioner GSIS.
2. In considering the ailment of Subarachnoid Hemorrhage Secondary to Ruptured
Aneurysm as permanent total disability.11cräläwvirtualibräry
The sole issue to be resolved here is whether private respondent is entitled to
conversion of her benefits from permanent partial disability to permanent total
disability.
Both petitioner and the Solicitor General argue against private respondents request
for the conversion of her disability benefits on the ground that she had already been
awarded the benefits commensurate to the degree of her physical condition at the
time of her retirement. They contend that her ailment Subarachnoid Hemorrhage
Secondary to Ruptured Aneurysm only entitled her to receive benefits for permanent
partial disability and such illness does not satisfy the criteria for permanent total
disability. Furthermore, they aver that private respondents request for conversion
cannot be granted because other than alleging abnormalities and non-improvement of
memory she failed to show sufficient medical basis that would warrant said
conversion.
Petitioner also maintains that, although private respondent was awarded permanent
partial disability benefits for nine (9) months commencing on the day of her
retirement, it does not automatically follow that petitioner recognized her disability as
permanent and total because the period of 120 days mentioned in Sec. 2, Rule 7 of
the Amended Rules on Employees Compensation is not the determining factor.
Petitioner contends that an injury or illness that goes beyond the said 120 days may
still be considered as permanent partial disability pursuant to Sec. 2, Rule 10 of the
same rules.
The Court has already dismissed the same arguments before in similar cases.
Petitioners insistence must therefore suffer the same fate in the instant case.
It is also important to note that private respondent was constrained to retire at the age
of 62 years because of her impaired physical condition. This, again, is another
indication that her disability is permanent and total. As held by this Court, the fact of
an employees disability is placed beyond question with the approval of the employees
optional retirement, for such is authorized only when the employee is `physically
incapable to render sound and efficient service x x x.17cräläwvirtualibräry
In the case at bar, the denial of the claim for permanent total disability benefit of
private respondent who, for 38 long years during her prime had rendered her best
service with an unblemished record and who was compelled to retire on account of
her worsening condition, would indeed subvert the salutary intentions of the law in
favor of the worker. The Court, therefore, affirms the decision of the respondent Court
of Appeals decreeing conversion of private respondents disability from permanent
partial disability to permanent total disability.

While it is true that the degree of private respondents physical condition at the time of
her retirement was not considered as permanent total disability, yet, it cannot be
denied that her condition subsequently worsened after her head operation and
consequent retirement. In fact, she suffered afterwards from some ailments like
headaches, dizziness, weakness, inability to properly sleep, inability to walk without
support and failure to regain her memory. All these circumstances ineluctably
demonstrate the seriousness of her condition, contrary to the claim of petitioner. More
than that, it was also undisputed that private respondent was made to take her
medication for life.
A persons disability may not manifest fully at one precise moment in time but rather
over a period of time. It is possible that an injury which at first was considered to be
temporary may later on become permanent or one who suffers a partial disability
becomes totally and permanently disabled from the same cause.12cräläwvirtualibräry
In the same vein, this Court has ruled that disability should not be understood more
on its medical significance but on the loss of earning capacity.13 Private respondents
persistent illness indeed forced her to retire early which, in turn, resulted in her
unemployment, and loss of earning capacity.
One final note. The GSIS and ECC should be commended for their vigilance against
unjustified claims that will deplete the funds intended to be disbursed for the benefit
only of deserving disabled employees. Nevertheless, we should caution them against
a too strict interpretation of the rules lest it result in the withholding of full assistance
from those whose capabilities have been diminished, if not completely impaired, as a
consequence of their dedicated service in the government. A humanitarian impulse,
dictated by no less than the Constitution itself under the social justice policy, calls for
a liberal and sympathetic approach to the legitimate appeals of disabled public
servants like the herein private respondent. Compassion for them is not a doleout but
a right.18cräläwvirtualibräry
WHEREFORE, the instant petition is hereby DENIED, and the challenged decision of
the Court of Appeals dated October 17, 1994 is AFFIRMED in toto.
SO ORDERED.

Judicial precedents likewise show that disability is intimately related to ones earning
capacity. It has been a consistent pronouncement of this Court that permanent total
disability means disablement of an employee to earn wages in the same kind of work,
or work of a similar nature that she was trained for or accustomed to perform, or any
kind of work which a person of her mentality and attainment could do. 14 It does not
mean state of absolute helplessness, but inability to do substantially all material acts
necessary to prosecution of an occupation for remuneration or profit in substantially
customary and usual manner.15cräläwvirtualibräry

The Court has construed permanent total disability as the lack of ability to follow
continuously some substantially gainful occupation without serious discomfort or pain
and without material injury or danger to life.16 It is, therefore, clear from established
jurisprudence that the loss of ones earning capacity determines the disability
compensation one is entitled to.