Biagtan Case

G.R. No.
L-25579 March 29, 1972
EMILIA T. BIAGTAN, JUAN T. BIAGTAN, JR., MIGUEL T. BIAGTAN, GIL T. BIAGTAN and GRACIA T.
BIAGTAN, plaintiffs-appellees,
vs.
THE INSULAR LIFE ASSURANCE COMPANY, LTD., defendant-appellant.
Tanopo, Millora, Serafica, and Sañez for plaintiff-appellees.
Araneta, Mendoza and Papa for defendant-appellant.
MAKALINTAL, J.:p
This is an appeal from the decision of the Court of First Instance of Pangasinan in its Civil Case No. D-
1700.
The facts are stipulated. Juan S. Biagtan was insured with defendant InsularLife Assurance Company
under Policy No. 398075 for the sum of P5,000.00 and, under a supplementary contract denominated
"Accidental Death Benefit Clause, for an additional sum of P5,000.00 if "the death of the Insured
resulted directly from bodily injury effected solely through external and violent means sustained in an
accident ... and independently of all other causes." The clause, however, expressively provided that it
would not apply where death resulted from an injury"intentionally inflicted by another party."
On the night of May 20, 1964, or during the first hours of the following day a band of robbers entered
the house of the insured Juan S. Biagtan. What happened then is related in the decision of the trial court
as follows:
...; that on the night of May 20, 1964 or the first hours of May 21, 1964, while the said life policy and
supplementary contract were in full force and effect, the house of insured Juan S. Biagtan was robbed by
a band of robbers who were charged in and convicted by the Court of First Instance of Pangasinan for
robbery with homicide; that in committing the robbery, the robbers, on reaching the staircase landing
on the second floor, rushed towards the door of the second floor room, where they suddenly met a
person near the door of oneof the rooms who turned out to be the insured Juan S. Biagtan who received
thrusts from their sharp-pointed instruments, causing wounds on the body of said Juan S. Biagtan
resulting in his death at about 7 a.m. on the same day, May 21, 1964;
Plaintiffs, as beneficiaries of the insured, filed a claim under the policy. The insurance company paid the
basic amount of P5,000.00 but refused to pay the additional sum of P5,000.00 under the accidental
death benefit clause, on the ground that the insured's death resulted from injuries intentionally inflicted
by third parties and therefore was not covered. Plaintiffs filed suit to recover, and after due hearing the
court a quo rendered judgment in their favor. Hence the present appeal by the insurer.
The only issue here is whether under the facts are stipulated and found by the trial court the wounds
received by the insured at the hands of the robbers — nine in all, five of them mortal and four non-
mortal — were inflicted intentionally. The court, in ruling negatively on the issue, stated that since the
parties presented no evidence and submitted the case upon stipulation, there was no "proof that the act
of receiving thrust (sic) from the sharp-pointed instrument of the robbers was intended to inflict injuries
upon the person of the insured or any other person or merely to scare away any person so as to ward
off any resistance or obstacle that might be offered in the pursuit of their main objective which was
robbery."
The trial court committed a plain error in drawing the conclusion it did from the admitted facts. Nine
wounds were inflicted upon the deceased, all by means of thrusts with sharp-pointed instruments
wielded by the robbers. This is a physical fact as to which there is no dispute. So is the fact that five of
those wounds caused the death of the insured. Whether the robbers had the intent to kill or merely to
scare the victim or to ward off any defense he might offer, it cannot be denied that the act itself of
inflicting the injuries was intentional. It should be noted that the exception in the accidental benefit
clause invoked by the appellant does not speak of the purpose — whether homicidal or not — of a third
party in causing the injuries, but only of the fact that such injuries have been "intentionally" inflicted —
this obviously to distinguish them from injuries which, although received at the hands of a third party,
are purely accidental. This construction is the basic idea expressed in the coverage of the clause itself,
namely, that "the death of the insured resulted directly from bodily injury effected solely through
external and violent means sustained in an accident ... and independently of all other causes." A gun
which discharges while being cleaned and kills a bystander; a hunter who shoots at his prey and hits a
person instead; an athlete in a competitive game involving physical effort who collides with an opponent
and fatally injures him as a result: these are instances where the infliction of the injury is unintentional
and therefore would be within the coverage of an accidental death benefit clause such as thatin
question in this case. But where a gang of robbers enter a house and coming face to face with the
owner, even if unexpectedly, stab him repeatedly, it is contrary to all reason and logic to say that his
injuries are not intentionally inflicted, regardless of whether they prove fatal or not. As it was, in the
present case they did prove fatal, and the robbers have been accused and convicted of the crime of
robbery with homicide.
The case of Calanoc vs. Court of Appeals, 98 Phil. 79, is relied upon by the trial court in support of its
decision. The facts in that case, however, are different from those obtaining here. The insured there was
a watchman in a certain company, who happened to be invited by a policeman to come along as the
latter was on his way to investigate a reported robbery going on in a private house. As the two of them,
together with the owner of the house, approached and stood in front of the main gate, a shot was fired
and it turned out afterwards that the watchman was hit in the abdomen, the wound causing his death.
Under those circumstances this Court held that it could not be said that the killing was intentional for
there was the possibility that the malefactor had fired the shot to scare people around for his own
protection and not necessarrily to kill or hit the victim. A similar possibility is clearly ruled out by the
facts in the case now before Us. For while a single shot fired from a distance, and by a person who was
not even seen aiming at the victim, could indeed have been fired without intent to kill or injure, nine
wounds inflicted with bladed weapons at close range cannot conceivably be considered as innocent
insofar as such intent is concerned. The manner of execution of the crime permits no other conclusion.
Court decisions in the American jurisdiction, where similar provisions in accidental death benefit clauses
in insurance policies have been construed, may shed light on the issue before Us. Thus, it has been held
that "intentional" as used in an accident policy excepting intentional injuries inflicted by the insured or
any other person, etc., implies the exercise of the reasoning faculties, consciousness and
volition.1 Where a provision of the policy excludes intentional injury, it is the intention of the person
inflicting the injury that is controlling.2 If the injuries suffered by the insured clearly resulted from the
intentional act of a third person the insurer is relieved from liability as stipulated.3
In the case of Hutchcraft's Ex'r v. Travelers' Ins. Co., 87 Ky. 300, 8 S.W. 570, 12 Am. St. Rep. 484, the
insured was waylaid and assassinated for the purpose of robbery. Two (2) defenses were interposed to
the action to recover indemnity, namely: (1) that the insured having been killed by intentional means,
his death was not accidental, and (2) that the proviso in the policy expressly exempted the insurer from
liability in case the insured died from injuries intentionally inflicted by another person. In rendering
judgment for the insurance company the Court held that while the assassination of the insured was as to
him an unforeseen event and therefore accidental, "the clause of the proviso that excludes the
(insurer's) liability, in case death or injury is intentionally inflicted by another person, applies to this
case."
In Butero v. Travelers' Acc. Ins. Co., 96 Wis. 536, 65 Am. St. Rep. 61, 71 S.W. 811, the insured was shot
three times by a person unknown late on a dark and stormy night, while working in the coal shed of a
railroad company. The policy did not cover death resulting from "intentional injuries inflicted by the
insured or any other person." The inquiry was as to the question whether the shooting that caused the
insured's death was accidental or intentional; and the Court found that under the facts, showing that
the murderer knew his victim and that he fired with intent to kill, there could be no recovery under the
policy which excepted death from intentional injuries inflicted by any person.
WHEREFORE, the decision appealed from is reversed and the complaint dismissed, without
pronouncement as to costs.
Zaldivar, Castro, Fernando and Villamor, JJ., concur.
Makasiar, J., reserves his vote.
Separate Opinions
BARREDO, J., concurring —
During the deliberations in this case, I entertained some doubts as to the correctness and validity of the
view upheld in the main opinion penned by Justice Makalintal. Further reflection has convinced me,
however, that there are good reasons to support it.
At first blush, one would feel that every death not suicidal should be considered accidental, for the
purposes of an accident insurance policy or a life insurance policy with a double indemnity clause in case
death results from accident. Indeed, it is quite logical to think that any event whether caused by fault,
negligence, intent of a third party or any unavoidable circumstance, normally unforeseen by the insured
and free from any possible connivance on his part, is an accident in the generally accepted sense of the
term. And if I were convinced that in including in the policy the provision in question, both the insurer
and the insured had in mind to exclude thereby from the coverage of the policy only suicide whether
unhelped or helped somehow by a third party, I would disregard the American decisions cited and
quoted in the main opinion as not even persuasive authorities. But examining the unequivocal language
of the provision in controversy and considering that the insured accepted the policy without asking that
it be made clear that the phrase "injury intentionally inflicted by a third party" should be understood to
refer only to injuries inflicted by a third party without any wilful intervention on his part (of the insured)
or, in other words, without any connivance with him (the insured) in order to augment the proceeds of
the policy for his benificiaries, I am inclined to agree that death caused by criminal assault is not covered
by the policies of the kind here in question, specially if the assault, as a matter of fact, could have been
more or less anticipated, as when the insured happens to have violent enemies or is found in
circumstances that would make his life fair game of third parties.
As to the rest, I have no doubt that the killing of the insured in this case is as intentional as any
intentional act can be, hence this concurrence.
TEEHANKEE, J., dissenting:
The sole issue at bar is the correctness in law of the lower court's appealed decision adjudging
defendant insurance company liable, under its supplementary contract denominated "Accidental Death
Benefit Clause" with the deceased insured, to plaintiffs-beneficiaries (excluding plaintiff Emilia T.
Biagtan) in an additional amount of P5,000.00 (with corresponding legal interest) and ruling that
defendant company had failed to present any evidence to substantiate its defense that the insured's
death came within the stipulated exceptions.
Defendant's accidental death benefit clause expressly provides:
ACCIDENTAL DEATH BENEFIT. (hereinafter called the benefit). Upon receipt and approval of due proof
that the death of the Insured resulted directly from bodily injury effected solely through external and
violent means sustained in an accident, within ninety days after the date of sustaining such injury, and
independently of all other causes, this Company shall pay, in addition to the sum insured specified on
the first page of this Policy, a further sum equal to said sum insured payable at the same time and in the
same manner as said sum insured, provided, that such death occurred during the continuance of this
Clause and of this Policy and before the sixtieth birthday of the Insured."1
A long list of exceptions and an Automatic Discontinuance clause immediately follow thereafter, thus:
EXCEPTIONS. The Benefit shall not apply if the Insured's death shall result, either directly or indirectly,
from any one of the following causes:
(1) Self-destruction or self-inflicted injuries, whether the Insured be sane or insane;
(2) Bodily or mental infirmity or disease of any kind;
(3) Poisoning or infection, other than infection occurring simultaneously with and in consequence of a
cut or wound sustained in an accident;
(4) Injuries of which there is no visible contusions or wound on the exterior of the body, drowning and
internal injuries revealed by autopsy excepted;
(5) Any injuries received (a) while on police duty in any military, naval or police organization; (b) in
any riot, civil commotion, insurrection or war or any act incident thereto; (c) while travelling as a
passenger or otherwise in any form of submarine transportation, or while engaging in submarine
operations; (d) in any violation of the law by the Insured or assault provoked by the Insured; (e) that has
been inflicted intentionally by a third party, either with or without provocation on the part of the
Insured, and whether or not the attack or the defense by the third party was caused by a violation of the
law by the Insured;
(6) Operating or riding in or descending from any kind of aircraft if the Insured is a pilot, officer or
member of the crew of the aircraft or is giving or receiving any kind of training or instruction or has any
duties aboard the aircraft or requiring descent therefrom; and
(7) Atomic energy explosion of any nature whatsoever.
The Company, before making any payment under this Clause, shall have the right and opportunity to
examine the body and make an autopsy thereof.
AUTOMATIC DISCONTINUANCE. This Benefit shall automatically terminate and the additional premium
therefor shall cease to be payable when and if:
(1) This Policy is surrendered for cash, paid-up insurance or extended term insurance; or
(2) The benefit under the Total and Permanent Disability Waiver of Premium Certificate is granted to the
insured; or
(3) The Insured engages in military, naval or aeronautic service in time of war; or
(4) The policy anniversary immediately preceding the sixtieth birthday of the Insured is reached.2
It is undisputed that, as recited in the lower court's decision, the insured met his death, as follows: "that
on the night of May 20, 1964 or the first hours of May 21, 1964, while the said life policy and
robbery with homicide; that in committing the robbery, the robbers, on reaching the staircase landing of
the second floor, rushed towards the doors of the second floor room, where they suddenly met a person
near the door of one of the rooms who turned out to be the insured Juan S. Biagtan who received thrust
from their sharp-pointed instruments, causing wounds on the body of said Juan S. Biagtan resulting in
his death at about 7 a.m. on the same day, May 21, 1964." 3
Defendant company, while admitting the above-recited circumstances under which the insured met his
death, disclaimed liability under its accidental death benefit clause under paragraph 5 of its stipulated
"Exceptions" on its theory that the insured's death resulted from injuries "intentionally inflicted by a
third party," i.e. the robbers who broke into the insured's house and inflicted fatal injuries on him.
The case was submitted for decision upon the parties' stipulation of facts that (1) insurance companies
such as the Lincoln National Life Insurance Co. and Sun Life Assurance Co. of Canada with which the
deceased insured Juan S. Biagtan was also insured for much larger sums under similar contracts with
accidental death benefit provisions have promptly paid the benefits thereunder to plaintiffs-
beneficiaries; (2) the robbers who caused the insured's death were charged in and convicted by the
Court of First Instance of Pangasinan for the crime of robbery with homicide; and (3) the injuries
inflicted on the insured by the robbers consisted of five mortal and four non-mortal wounds.4
The lower court thereafter rendered judgment against defendant, as follows:
There is no doubt that the insured, Juan S. Biagtan, met his death as a result of the wounds inflicted
upon him by the malefactors on the early morning of May 21, 1964 by means of thrusts from sharp-
pointed instruments delivered upon his person, and there is likewise no question that the thrusts were
made on the occasion of the robbery. However, it is defendants' position that the killing of the insured
was intentionally done by the malefactors, who were charged with and convicted of the crime of
robbery with homicide by the Court of First Instance of Pangasinan.
It must be noted here that no evidence whatsoever was presented by the parties who submitted the case
for resolution upon the stipulation of facts presented by them. Thus, the court does not have before it
proof that the act of receiving thrust(s) from the sharp-pointed instrument of the robbers was intended
to inflict injuries upon the person of the insured or any other person or merely to scare away any person
so as to ward off any resistance or obstacle that might be offered in the pursuit of their main objective
which was robbery. It was held that where a provision of the policy excludes intentional injury, it is the
intention of the person inflicting the injury that is controlling ... and to come within the exception, the act
which causes the injury must be wholly intentional, not merely partly.
The case at bar has some similarity with the case of Virginia Calanoc vs. Court of Appeals, et al., L-8151,
promulgated December 16, 1965, where the Supreme Court ruled that "the shot (which killed the
insured) was merely to scare away the people around for his own protection and not necessarily to kill
or hit the victim."
In the Calanoc case, one Melencio Basilio, a watchman of a certain company, took out life insurance
from the Philippine American Life Insurance Company in the amount of P2,000.00 to which was attached
a supplementary contract covering death by accident. Calanoc died of gunshot wounds on the occasion
of a robbery committed in the house of a certain Atty. Ojeda in Manila. The insured's widow was paid
P2,000.00, the face value of the policy, but when she demanded payment of the additional sum of
P2,000.00 representing the value of the supplemental policy, the company refused alleging, as main
defense, that the deceased died because he was murdered by a person who took part in the commission
of the robbery and while making an arrest as an officer of the law which contingencies were (as in this
case) expressly excluded in the contract and have the effect of exempting the company from liability.
The facts in the Calanoc case insofar as pertinent to this case are, as found by the Court of Appeals in its
decision which findings of fact were adopted by the Supreme Court, as follows:
"...that on the way to the Ojeda residence (which was then being robbed by armed men), the policeman
and Atty. Ojeda passed by Basilio (the insured) and somehow or other invited the latter to come along;
that as the three approached the Ojeda residence and stood in front of the main gate which was
covered by galvanized iron, the fence itself being partly concrete and partly adobe stone, a shot was
fired; ... that it turned out afterwards that the special watchman Melencio Basilio was hit in the
abdomen, the wound causing his instantaneous death ..."
The Court of Appeals arrived at the conclusion that the death of Basilio, although unexpected, was not
caused by an accident, being a voluntary and intentional act on the part of the one who robbed, or one
of those who robbed, the house of Atty. Ojeda.
In reversing this conclusion of the Court of Appeals, the Supreme Court said in part:
"... Nor can it be said that the killing was intentional for there is the possibility that the malefactors had
fired the shot merely to scare away the people around for his own protection and not necessarily to kill
or hit the victim. In any event, while the act may not exempt the triggerman from ability for the damage
done, the fact remains that the happening was a pure accidentt on the part of the victim."
With this ruling of the Supreme Court, and the utter absence of evidence in this case as to the real
intention of the malefactors in making a thrust with their sharp-pointed instrument on any person, the
victim in particular, the case falls squarely within the ruling in the Calanoc vs. Court of Appeals case.
It is the considered view of this Court that the insured died because of an accident which happened on
the occasion of the robbery being committed in his house. His death was not sought (at least no
evidence was presented to show it was), and therefore was fortuitous. "Accident" was defined as that
which happens by chance or fortuitously, without intention or design, and which is unexpected, unusual
and unforeseen, or that which takes place without one's foresight or expectation — an event that
proceeds from an unknown cause, or is an unusual effect of a known cause, and therefore not expected.
(29 Am. Jur. 706).
There is no question that the defense set up by the defendant company is one of those included among
the risks excluded in the supplementary contract. However, there is no evidence here that the thrusts
with sharp-pointed instrument (which led to the death of the insured) was "intentional," (sic) so as to
exempt the company from liability. It could safely be assumed that it was purely accidental considering
that the principal motive of the culprits was robbery, the thrusts being merely intended to scare away
persons who might offer resistance or might obstruct them from pursuing their main objective which
was robbery.5
It is respectfully submitted that the lower court committed no error in law in holding defendant
insurance company liable to plaintiffs-beneficiaries under its accidental death benefit clause, by virtue of
the following considerations:
1. The case of Calanoc cited by the lower court is indeed controlling here. 6 This Court, there construing a
similar clause, squarely ruled that fatal injuries inflicted upon an insured by a malefactor(s) during the
latter's commission of a crime are deemed accidental and within the coverage of such accidental death
benefit clauses and the burden of proving that the killing was intentional so as to have it fall within the
stipulated exception of having resulted from injuries "intentionally inflicted by a third party" must be
discharged by the insurance company. This Court there clearly held that in such cases where the killing
does not amount to murder, it must be held to be a "pure accident" on the part of the victim,
compensable with double-indemnity, even though the malefactor is criminally liable for his act. This
Court rejected the insurance-company's contrary claim, thus:
Much less can it be pretended that Basilio died in the course of an assault or murder considering the
very nature of these crimes. In the first place, there is no proof that the death of Basilio is the result of
either crime for the record is barren of any circumstance showing how the fatal shot was fired. Perhaps
this may be clarified in the criminal case now pending in court a regards the incident but before that is
done anything that might be said on the point would be a mere conjecture. Nor can it be said that the
killing was intentional for there is the possibility that the malefactor had fired the shot merely to scare
away the people around for his own protection and not necessarily to kill or hit the victim. In any
event, while the act may not exempt the triggerman from liability for the damage done, the fact remains
that the happening was a pure accident on the part of the victim. The victim could have been either the
policeman or Atty. Ojeda for it cannot be pretended that the malefactor aimed at the deceased precisely
because he wanted to take his life. 7
2. Defendant company patently failed to discharge its burden of proving that the fatal injuries were
inflicted upon the deceased intentionally, i.e. deliberately. The lower court correctly held that since the
case was submitted upon the parties' stipulation of facts which did not cover the malefactors' intent at
all, there was an "utter absence of evidence in this case as to the real intention of the malefactors in
making a thrust with their sharp-pointed instrument(s) on any person, the victim in particular." From the
undisputed facts, supra,8 the robbers had "rushed towards the doors of the second floor room, where
they suddenly met a person ... who turned out to be the insured Juan S. Biagtan who received thrusts
from their pointed instruments." The thrusts were indeed properly termed "purely accidental" since
they seemed to be a reflex action on the robbers' part upon their being surprised by the deceased. To
argue, as defendant does, that the robbers' intent to kill must necessarily be deduced from the four
mortal wounds inflicted upon the deceased is to beg the question. Defendant must suffer the
consequences of its failure to discharge its burden of proving by competent evidence, e.g. the robbers'
or eyewitnesses' testimony, that the fatal injuries were intentionally inflicted upon the insured so as to
exempt itself from liability.
3. Furthermore, plaintiffs-appellees properly assert in their brief that the sole error assigned by
defendant company, to wit, that the fatal injuries were not accidental as held by the lower court but
should be held to have been intentionally inflicted, raises a question of fact — which defendant is now
barred from raising, since it expressly limited its appeal to this Court purely "on questions of law", per its
noitice of appeal,9 Defendant is therefore confined to "raising only questions of law" and "no other
questions" under Rule 42, section 2 of the Rules of Court 10 and is deemed to have conceded the findings
of fact of the trial court, since he thereby waived all questions of facts. 11
4. It has long been an established rule of construction of so-called contracts of adhesion such as
insurance contracts, where the insured is handed a printed insurance policy whose fine-print language
has long been selected with great care and deliberation by specialists and legal advisers employed by
and acting exclusively in the interest of the insurance company, that the terms and phraseology of the
policy, particularly of any exception clauses, must be clearly expressed so as to be easily understood by
the insured and any "ambiguous, equivocal or uncertain terms" are to be "construed strictly and most
strongly against the insurer and liberally in favor of the insured so as to effect the dominant purpose of
indemnity or payment to the insured, especially where a forfeiture is involved.
The Court so expressly held in Calanoc that:
... While as a general rule "the parties may limit the coverage of the policy to certain particular accidents
and risks or causes of loss, and may expressly except other risks or causes of loss therefrom" (45 C.J.S.
781-782), however, it is to be desired that the terms and phraseology of the exception clause be clearly
expressed so as to be within the easy grasp and understanding of the insured, for if the terms are
doubtful or obscure the same must of necessity be interpreted or resolved against the one who has
caused the obscurity. (Article 1377, new Civil Code) And so it has been generally held that the "terms in
an insurance policy, which are ambiguous, equivocal, or uncertain ... are to be construed strictly and
most strongly against the insurer, and liberally in favor of the insured so as to effect the dominant
purpose of indemnity or payment to the insured, especially where a forfeiture is involved" (29 AM. Jur.,
181), and the reason for this rule is that the "insured usually has no voice in the selection or
arrangement of the words employed and that the language of the contract is selected with great care
and deliberation by experts and legal advisers employed by, and acting exclusively in the interest of, the
insurance company." (44 C.J.S., p. 1174)
Insurance is, in its nature, complex and difficult for the layman to understand. Policies are prepared by
experts who know and can anticipate the bearing and possible complications of every contingency. So
long as insurance companies insist upon the use of ambiguous, intricate and technical provisions, which
conceal rather than frankly disclose, their own intentions, the courts must, in fairness to those who
purchase insurance construe every ambiguity in favor of the insured." (Algoe vs. Pacific Mut. L. Ins. Co.,
91 Wash. 324 LRA 1917A, 1237.)
"An insurer should not be allowed, by the use of obscure phrases and exceptions, to defeat the very
purpose for which the policy was procured." (Moore vs. Aetna Life Insurance Co., LRA 1915D, 164). 12
The Court has but recently reiterated this doctrine in Landicho vs. GSIS 13 and again applied the
provisions of Article 1377 of our Civil Code that "The interpretation of obscure words or stipulations in a
contract shall not favor the party who caused the obscurity."
5. The accidental death benefit clause assuring the insured's beneficiaries of double indemnity, upon
payment of an extra premium, in the event that the insured meets violent accidental death is
contractually stipulated as follows in the policy: "that the death of the insured resulted directly from
bodily injury effected solely through external and violent means sustained in an accident," supra. The
policy then lists numerous exceptions, which may be classified as follows:
— Injuries effected through non-external means which are excepted: self-destruction, bodily or mental

infirmity or disease, poisoning or infection, injuries with no visible contusions or exterior wounds
(exceptions 1 to 4 of policy clause);
— Injuries caused by some act of the insured which is proscribed by the policy, and are therefore
similarly exepted: injuries received while on police duty, while travelling in any form of submarine
transportation, or in any violation of law by the insured or assault provoked by the insured, or in any
aircraft if the insured is a pilot or crew member; [exceptions 5 (a), (c) and (d), and 6 of the policy clause];
and
— Accidents expressly excluded: where death resulted in any riot, civil commotion, insurrection or war
or atomic energy explosion. (Exceptions 5[b] and 7 of policy clause).
The only exception which is not susceptible of classification is that provided in paragraph 5 (e), the very
exception herein involved, which would also except injuries "inflicted intentionally by a third party,
either with or without provocation on the part of the insured, and whether or not the attack or the
defense by the third party was caused by a violation of the law by the insured."
This ambiguous clause conflicts with all the other four exceptions in the same paragraph 5 particularly
that immediately preceding it in item (d) which excepts injuries received where the insured has violated
the law or provoked the injury, while this clause, construed as the insurance company now claims,
would seemingly except also all other injuries, intentionally inflicted by a third party, regardless of any
violation of law or provocation by the insured, and defeat the very purpose of the policy of giving the
insured double indemnity in case of accidental death by "external and violent means" — in the very
language of the policy."
It is obvious from the very classification of the exceptions and applying the rule of noscitus a sociis that
the double-indemnity policy covers the insured against accidental death, whether caused by fault,
negligence or intent of a third party which is unforeseen and unexpected by the insured. All the
associated words and concepts in the policy plainly exclude the accidental death from the coverage of
the policy only where the injuries are self-inflicted or attended by some proscribed act of the insured or
are incurred in some expressly excluded calamity such as riot, war or atomic explosion.
Finally, the untenability of herein defendant insurer's claim that the insured's death fell within the
exception is further heightened by the stipulated fact that two other insurance companies which
likewise covered the insured for which larger sums under similar accidental death benefit clauses
promptly paid the benefits thereof to plaintiffs-beneficiaries.
I vote accordingly for the affirmance in toto of the appealed decision, with costs against defendant-
appellant.
Concepcion, C.J. and Reyes, J.B.L., J., concur.
Separate Opinions
BARREDO, J., concurring —
During the deliberations in this case, I entertained some doubts as to the correctness and validity of the
view upheld in the main opinion penned by Justice Makalintal. Further reflection has convinced me,
however, that there are good reasons to support it.
At first blush, one would feel that every death not suicidal should be considered accidental, for the
purposes of an accident insurance policy or a life insurance policy with a double indemnity clause in case
death results from accident. Indeed, it is quite logical to think that any event whether caused by fault,
negligence, intent of a third party or any unavoidable circumstance, normally unforeseen by the insured
and free from any possible connivance on his part, is an accident in the generally accepted sense of the
term. And if I were convinced that in including in the policy the provision in question, both the insurer
and the insured had in mind to exclude thereby from the coverage of the policy only suicide whether
unhelped or helped somehow by a third party, I would disregard the American decisions cited and
quoted in the main opinion as not even persuasive authorities. But examining the unequivocal language
of the provision in controversy and considering that the insured accepted the policy without asking that
it be made clear that the phrase "injury intentionally inflicted by a third party" should be understood to
refer only to injuries inflicted by a third party without any wilful intervention on his part (of the insured)
or, in other words, without any connivance with him (the insured) in order to augment the proceeds of
the policy for his benificiaries, I am inclined to agree that death caused by criminal assault is not covered
by the policies of the kind here in question, specially if the assault, as a matter of fact, could have been
more or less anticipated, as when the insured happens to have violent enemies or is found in
circumstances that would make his life fair game of third parties.
As to the rest, I have no doubt that the killing of the insured in this case is as intentional as any
intentional act can be, hence this concurrence.
TEEHANKEE, J., dissenting:
The sole issue at bar is the correctness in law of the lower court's appealed decision adjudging
defendant insurance company liable, under its supplementary contract denominated "Accidental Death
Benefit Clause" with the deceased insured, to plaintiffs-beneficiaries (excluding plaintiff Emilia T.
Biagtan) in an additional amount of P5,000.00 (with corresponding legal interest) and ruling that
defendant company had failed to present any evidence to substantiate its defense that the insured's
death came within the stipulated exceptions.
Defendant's accidental death benefit clause expressly provides:
ACCIDENTAL DEATH BENEFIT. (hereinafter called the benefit). Upon receipt and approval of due proof
that the death of the Insured resulted directly from bodily injury effected solely through external and
violent means sustained in an accident, within ninety days after the date of sustaining such injury, and
independently of all other causes, this Company shall pay, in addition to the sum insured specified on
the first page of this Policy, a further sum equal to said sum insured payable at the same time and in the
same manner as said sum insured, provided, that such death occurred during the continuance of this
Clause and of this Policy and before the sixtieth birthday of the Insured."1
A long list of exceptions and an Automatic Discontinuance clause immediately follow thereafter, thus:
EXCEPTIONS. The Benefit shall not apply if the Insured's death shall result, either directly or indirectly,
from any one of the following causes:
(1) Self-destruction or self-inflicted injuries, whether the Insured be sane or insane;
(2) Bodily or mental infirmity or disease of any kind;
(3) Poisoning or infection, other than infection occurring simultaneously with and in consequence of a
cut or wound sustained in an accident;
(4) Injuries of which there is no visible contusions or wound on the exterior of the body, drowning and
internal injuries revealed by autopsy excepted;
(5) Any injuries received (a) while on police duty in any military, naval or police organization; (b) in
any riot, civil commotion, insurrection or war or any act incident thereto; (c) while travelling as a
passenger or otherwise in any form of submarine transportation, or while engaging in submarine
operations; (d) in any violation of the law by the Insured or assault provoked by the Insured; (e) that has
been inflicted intentionally by a third party, either with or without provocation on the part of the
Insured, and whether or not the attack or the defense by the third party was caused by a violation of the
law by the Insured;
(6) Operating or riding in or descending from any kind of aircraft if the Insured is a pilot, officer or
member of the crew of the aircraft or is giving or receiving any kind of training or instruction or has any
duties aboard the aircraft or requiring descent therefrom; and
(7) Atomic energy explosion of any nature whatsoever.
The Company, before making any payment under this Clause, shall have the right and opportunity to
examine the body and make an autopsy thereof.
AUTOMATIC DISCONTINUANCE. This Benefit shall automatically terminate and the additional premium
therefor shall cease to be payable when and if:
(1) This Policy is surrendered for cash, paid-up insurance or extended term insurance; or
(2) The benefit under the Total and Permanent Disability Waiver of Premium Certificate is granted to the
insured; or
(3) The Insured engages in military, naval or aeronautic service in time of war; or
(4) The policy anniversary immediately preceding the sixtieth birthday of the Insured is reached.2
It is undisputed that, as recited in the lower court's decision, the insured met his death, as follows: "that
on the night of May 20, 1964 or the first hours of May 21, 1964, while the said life policy and
robbery with homicide; that in committing the robbery, the robbers, on reaching the staircase landing of
the second floor, rushed towards the doors of the second floor room, where they suddenly met a person
near the door of one of the rooms who turned out to be the insured Juan S. Biagtan who received thrust
from their sharp-pointed instruments, causing wounds on the body of said Juan S. Biagtan resulting in
his death at about 7 a.m. on the same day, May 21, 1964." 3
Defendant company, while admitting the above-recited circumstances under which the insured met his
death, disclaimed liability under its accidental death benefit clause under paragraph 5 of its stipulated
"Exceptions" on its theory that the insured's death resulted from injuries "intentionally inflicted by a
third party," i.e. the robbers who broke into the insured's house and inflicted fatal injuries on him.
The case was submitted for decision upon the parties' stipulation of facts that (1) insurance companies
such as the Lincoln National Life Insurance Co. and Sun Life Assurance Co. of Canada with which the
deceased insured Juan S. Biagtan was also insured for much larger sums under similar contracts with
accidental death benefit provisions have promptly paid the benefits thereunder to plaintiffs-
beneficiaries; (2) the robbers who caused the insured's death were charged in and convicted by the
Court of First Instance of Pangasinan for the crime of robbery with homicide; and (3) the injuries
inflicted on the insured by the robbers consisted of five mortal and four non-mortal wounds.4
The lower court thereafter rendered judgment against defendant, as follows:
There is no doubt that the insured, Juan S. Biagtan, met his death as a result of the wounds inflicted
upon him by the malefactors on the early morning of May 21, 1964 by means of thrusts from sharp-
pointed instruments delivered upon his person, and there is likewise no question that the thrusts were
made on the occasion of the robbery. However, it is defendants' position that the killing of the insured
was intentionally done by the malefactors, who were charged with and convicted of the crime of
robbery with homicide by the Court of First Instance of Pangasinan.
It must be noted here that no evidence whatsoever was presented by the parties who submitted the case
for resolution upon the stipulation of facts presented by them. Thus, the court does not have before it
proof that the act of receiving thrust(s) from the sharp-pointed instrument of the robbers was intended
to inflict injuries upon the person of the insured or any other person or merely to scare away any person
so as to ward off any resistance or obstacle that might be offered in the pursuit of their main objective
which was robbery. It was held that where a provision of the policy excludes intentional injury, it is the
intention of the person inflicting the injury that is controlling ... and to come within the exception, the act
which causes the injury must be wholly intentional, not merely partly.
The case at bar has some similarity with the case of Virginia Calanoc vs. Court of Appeals, et al., L-8151,
promulgated December 16, 1965, where the Supreme Court ruled that "the shot (which killed the
insured) was merely to scare away the people around for his own protection and not necessarily to kill
or hit the victim."
In the Calanoc case, one Melencio Basilio, a watchman of a certain company, took out life insurance
from the Philippine American Life Insurance Company in the amount of P2,000.00 to which was attached
a supplementary contract covering death by accident. Calanoc died of gunshot wounds on the occasion
of a robbery committed in the house of a certain Atty. Ojeda in Manila. The insured's widow was paid
P2,000.00, the face value of the policy, but when she demanded payment of the additional sum of
P2,000.00 representing the value of the supplemental policy, the company refused alleging, as main
of the robbery and while making an arrest as an officer of the law which contingencies were (as in this
case) expressly excluded in the contract and have the effect of exempting the company from liability.
The facts in the Calanoc case insofar as pertinent to this case are, as found by the Court of Appeals in its
decision which findings of fact were adopted by the Supreme Court, as follows:
"...that on the way to the Ojeda residence (which was then being robbed by armed men), the policeman
and Atty. Ojeda passed by Basilio (the insured) and somehow or other invited the latter to come along;
that as the three approached the Ojeda residence and stood in front of the main gate which was
covered by galvanized iron, the fence itself being partly concrete and partly adobe stone, a shot was
fired; ... that it turned out afterwards that the special watchman Melencio Basilio was hit in the
abdomen, the wound causing his instantaneous death ..."
The Court of Appeals arrived at the conclusion that the death of Basilio, although unexpected, was not
caused by an accident, being a voluntary and intentional act on the part of the one who robbed, or one
of those who robbed, the house of Atty. Ojeda.
In reversing this conclusion of the Court of Appeals, the Supreme Court said in part:
"... Nor can it be said that the killing was intentional for there is the possibility that the malefactors had
fired the shot merely to scare away the people around for his own protection and not necessarily to kill
or hit the victim. In any event, while the act may not exempt the triggerman from ability for the damage
done, the fact remains that the happening was a pure accidentt on the part of the victim."
With this ruling of the Supreme Court, and the utter absence of evidence in this case as to the real
intention of the malefactors in making a thrust with their sharp-pointed instrument on any person, the
victim in particular, the case falls squarely within the ruling in the Calanoc vs. Court of Appeals case.
It is the considered view of this Court that the insured died because of an accident which happened on
the occasion of the robbery being committed in his house. His death was not sought (at least no
evidence was presented to show it was), and therefore was fortuitous. "Accident" was defined as that
which happens by chance or fortuitously, without intention or design, and which is unexpected, unusual
and unforeseen, or that which takes place without one's foresight or expectation — an event that
proceeds from an unknown cause, or is an unusual effect of a known cause, and therefore not expected.
(29 Am. Jur. 706).
There is no question that the defense set up by the defendant company is one of those included among
the risks excluded in the supplementary contract. However, there is no evidence here that the thrusts
with sharp-pointed instrument (which led to the death of the insured) was "intentional," (sic) so as to
exempt the company from liability. It could safely be assumed that it was purely accidental considering
that the principal motive of the culprits was robbery, the thrusts being merely intended to scare away
persons who might offer resistance or might obstruct them from pursuing their main objective which
was robbery.5
It is respectfully submitted that the lower court committed no error in law in holding defendant
insurance company liable to plaintiffs-beneficiaries under its accidental death benefit clause, by virtue of
the following considerations:
1. The case of Calanoc cited by the lower court is indeed controlling here. 6 This Court, there construing a
similar clause, squarely ruled that fatal injuries inflicted upon an insured by a malefactor(s) during the
latter's commission of a crime are deemed accidental and within the coverage of such accidental death
benefit clauses and the burden of proving that the killing was intentional so as to have it fall within the
stipulated exception of having resulted from injuries "intentionally inflicted by a third party" must be
discharged by the insurance company. This Court there clearly held that in such cases where the killing
does not amount to murder, it must be held to be a "pure accident" on the part of the victim,
compensable with double-indemnity, even though the malefactor is criminally liable for his act. This
Court rejected the insurance-company's contrary claim, thus:
this may be clarified in the criminal case now pending in court a regards the incident but before that is
away the people around for his own protection and not necessarily to kill or hit the victim. In any
event, while the act may not exempt the triggerman from liability for the damage done, the fact remains
that the happening was a pure accident on the part of the victim. The victim could have been either the
because he wanted to take his life. 7
2. Defendant company patently failed to discharge its burden of proving that the fatal injuries were
inflicted upon the deceased intentionally, i.e. deliberately. The lower court correctly held that since the
case was submitted upon the parties' stipulation of facts which did not cover the malefactors' intent at
all, there was an "utter absence of evidence in this case as to the real intention of the malefactors in
making a thrust with their sharp-pointed instrument(s) on any person, the victim in particular." From the
undisputed facts, supra,8 the robbers had "rushed towards the doors of the second floor room, where
they suddenly met a person ... who turned out to be the insured Juan S. Biagtan who received thrusts
from their pointed instruments." The thrusts were indeed properly termed "purely accidental" since
they seemed to be a reflex action on the robbers' part upon their being surprised by the deceased. To
argue, as defendant does, that the robbers' intent to kill must necessarily be deduced from the four
mortal wounds inflicted upon the deceased is to beg the question. Defendant must suffer the
consequences of its failure to discharge its burden of proving by competent evidence, e.g. the robbers'
or eyewitnesses' testimony, that the fatal injuries were intentionally inflicted upon the insured so as to
exempt itself from liability.
3. Furthermore, plaintiffs-appellees properly assert in their brief that the sole error assigned by
defendant company, to wit, that the fatal injuries were not accidental as held by the lower court but
should be held to have been intentionally inflicted, raises a question of fact — which defendant is now
barred from raising, since it expressly limited its appeal to this Court purely "on questions of law", per its
noitice of appeal,9 Defendant is therefore confined to "raising only questions of law" and "no other
questions" under Rule 42, section 2 of the Rules of Court 10 and is deemed to have conceded the findings
of fact of the trial court, since he thereby waived all questions of facts. 11
4. It has long been an established rule of construction of so-called contracts of adhesion such as
insurance contracts, where the insured is handed a printed insurance policy whose fine-print language
has long been selected with great care and deliberation by specialists and legal advisers employed by
and acting exclusively in the interest of the insurance company, that the terms and phraseology of the
policy, particularly of any exception clauses, must be clearly expressed so as to be easily understood by
the insured and any "ambiguous, equivocal or uncertain terms" are to be "construed strictly and most
strongly against the insurer and liberally in favor of the insured so as to effect the dominant purpose of
indemnity or payment to the insured, especially where a forfeiture is involved.
The Court so expressly held in Calanoc that:
... While as a general rule "the parties may limit the coverage of the policy to certain particular accidents
and risks or causes of loss, and may expressly except other risks or causes of loss therefrom" (45 C.J.S.
781-782), however, it is to be desired that the terms and phraseology of the exception clause be clearly
expressed so as to be within the easy grasp and understanding of the insured, for if the terms are
doubtful or obscure the same must of necessity be interpreted or resolved against the one who has
caused the obscurity. (Article 1377, new Civil Code) And so it has been generally held that the "terms in
an insurance policy, which are ambiguous, equivocal, or uncertain ... are to be construed strictly and
most strongly against the insurer, and liberally in favor of the insured so as to effect the dominant
purpose of indemnity or payment to the insured, especially where a forfeiture is involved" (29 AM. Jur.,
181), and the reason for this rule is that the "insured usually has no voice in the selection or
arrangement of the words employed and that the language of the contract is selected with great care
and deliberation by experts and legal advisers employed by, and acting exclusively in the interest of, the
insurance company." (44 C.J.S., p. 1174)
experts who know and can anticipate the bearing and possible complications of every contingency. So
purchase insurance construe every ambiguity in favor of the insured." (Algoe vs. Pacific Mut. L. Ins. Co.,
91 Wash. 324 LRA 1917A, 1237.)
"An insurer should not be allowed, by the use of obscure phrases and exceptions, to defeat the very
purpose for which the policy was procured." (Moore vs. Aetna Life Insurance Co., LRA 1915D, 164). 12
The Court has but recently reiterated this doctrine in Landicho vs. GSIS 13 and again applied the
provisions of Article 1377 of our Civil Code that "The interpretation of obscure words or stipulations in a
contract shall not favor the party who caused the obscurity."
5. The accidental death benefit clause assuring the insured's beneficiaries of double indemnity, upon
payment of an extra premium, in the event that the insured meets violent accidental death is
contractually stipulated as follows in the policy: "that the death of the insured resulted directly from
bodily injury effected solely through external and violent means sustained in an accident," supra. The
policy then lists numerous exceptions, which may be classified as follows:
— Injuries effected through non-external means which are excepted: self-destruction, bodily or mental

infirmity or disease, poisoning or infection, injuries with no visible contusions or exterior wounds
(exceptions 1 to 4 of policy clause);
— Injuries caused by some act of the insured which is proscribed by the policy, and are therefore
similarly exepted: injuries received while on police duty, while travelling in any form of submarine
transportation, or in any violation of law by the insured or assault provoked by the insured, or in any
aircraft if the insured is a pilot or crew member; [exceptions 5 (a), (c) and (d), and 6 of the policy clause];
and
— Accidents expressly excluded: where death resulted in any riot, civil commotion, insurrection or war
or atomic energy explosion. (Exceptions 5[b] and 7 of policy clause).
The only exception which is not susceptible of classification is that provided in paragraph 5 (e), the very
exception herein involved, which would also except injuries "inflicted intentionally by a third party,
either with or without provocation on the part of the insured, and whether or not the attack or the
defense by the third party was caused by a violation of the law by the insured."
This ambiguous clause conflicts with all the other four exceptions in the same paragraph 5 particularly
that immediately preceding it in item (d) which excepts injuries received where the insured has violated
the law or provoked the injury, while this clause, construed as the insurance company now claims,
would seemingly except also all other injuries, intentionally inflicted by a third party, regardless of any
violation of law or provocation by the insured, and defeat the very purpose of the policy of giving the
insured double indemnity in case of accidental death by "external and violent means" — in the very
language of the policy."
It is obvious from the very classification of the exceptions and applying the rule of noscitus a sociis that
the double-indemnity policy covers the insured against accidental death, whether caused by fault,
negligence or intent of a third party which is unforeseen and unexpected by the insured. All the
associated words and concepts in the policy plainly exclude the accidental death from the coverage of
the policy only where the injuries are self-inflicted or attended by some proscribed act of the insured or
are incurred in some expressly excluded calamity such as riot, war or atomic explosion.
Finally, the untenability of herein defendant insurer's claim that the insured's death fell within the
exception is further heightened by the stipulated fact that two other insurance companies which
likewise covered the insured for which larger sums under similar accidental death benefit clauses
promptly paid the benefits thereof to plaintiffs-beneficiaries.
I vote accordingly for the affirmance in toto of the appealed decision, with costs against defendant-
appellant.
G.R. No. 92383 July 17, 1992
SUN INSURANCE OFFICE, LTD., petitioner,

vs.
THE HON. COURT OF APPEALS and NERISSA LIM, respondents.
CRUZ, J.:
The petitioner issued Personal Accident Policy No. 05687 to Felix Lim, Jr. with a face value of
P200,000.00. Two months later, he was dead with a bullet wound in his head. As beneficiary, his wife
Nerissa Lim sought payment on the policy but her claim was rejected. The petitioner agreed that there
was no suicide. It argued, however that there was no accident either.
Pilar Nalagon, Lim's secretary, was the only eyewitness to his death. It happened on October 6, 1982, at
about 10 o'clock in the evening, after his mother's birthday party. According to Nalagon, Lim was in a
happy mood (but not drunk) and was playing with his handgun, from which he had previously removed
the magazine. As she watched television, he stood in front of her and pointed the gun at her. She
pushed it aside and said it might he loaded. He assured her it was not and then pointed it to his temple.
The next moment there was an explosion and Lim slumped to the floor. He was dead before he fell. 1
The widow sued the petitioner in the Regional Trial Court of Zamboanga City and was sustained. 2 The
petitioner was sentenced to pay her P200,000.00, representing the face value of the policy, with interest
at the legal rate; P10,000.00 as moral damages; P5,000.00 as exemplary damages; P5,000.00 as actual
and compensatory damages; and P5,000.00 as attorney's fees, plus the costs of the suit. This decision
was affirmed on appeal, and the motion for reconsideration was denied. 3 The petitioner then came to
this Court to fault the Court of Appeals for approving the payment of the claim and the award of
damages.
The term "accident" has been defined as follows:
The words "accident" and "accidental" have never acquired any technical signification in law, and when
used in an insurance contract are to be construed and considered according to the ordinary
understanding and common usage and speech of people generally. In-substance, the courts are
practically agreed that the words "accident" and "accidental" mean that which happens by chance or
fortuitously, without intention or design, and which is unexpected, unusual, and unforeseen. The
definition that has usually been adopted by the courts is that an accident is an event that takes place
without one's foresight or expectation — an event that proceeds from an unknown cause, or is an
unusual effect of a known case, and therefore not expected. 4
An accident is an event which happens without any human agency or, if happening through human
agency, an event which, under the circumstances, is unusual to and not expected by the person to
whom it happens. It has also been defined as an injury which happens by reason of some violence or
casualty to the injured without his design, consent, or voluntary co-operation. 5
In light of these definitions, the Court is convinced that the incident that resulted in Lim's death was
indeed an accident. The petitioner, invoking the case of De la Cruz v. Capital Insurance, 6 says that "there
is no accident when a deliberate act is performed unless some additional, unexpected, independent and
unforeseen happening occurs which produces or brings about their injury or death." There was such a
happening. This was the firing of the gun, which was the additional unexpected and independent and
unforeseen occurrence that led to the insured person's death.
The petitioner also cites one of the four exceptions provided for in the insurance contract and contends
that the private petitioner's claim is barred by such provision. It is there stated:
Exceptions —
The company shall not be liable in respect of
1. Bodily injury
xxx xxx xxx
b. consequent upon
i) The insured person attempting to commit suicide or willfully exposing himself to needless peril except
in an attempt to save human life.
To repeat, the parties agree that Lim did not commit suicide. Nevertheless, the petitioner contends that
the insured willfully exposed himself to needless peril and thus removed himself from the coverage of
the insurance policy.
It should be noted at the outset that suicide and willful exposure to needless peril are in pari
materia because they both signify a disregard for one's life. The only difference is in degree, as suicide
imports a positive act of ending such life whereas the second act indicates a reckless risking of it that is
almost suicidal in intent. To illustrate, a person who walks a tightrope one thousand meters above the
ground and without any safety device may not actually be intending to commit suicide, but his act is
nonetheless suicidal. He would thus be considered as "willfully exposing himself to needless peril" within
the meaning of the exception in question.
The petitioner maintains that by the mere act of pointing the gun to hip temple, Lim had willfully
exposed himself to needless peril and so came under the exception. The theory is that a gun is per
se dangerous and should therefore be handled cautiously in every case.
That posture is arguable. But what is not is that, as the secretary testified, Lim had removed the
magazine from the gun and believed it was no longer dangerous. He expressly assured her that the gun
was not loaded. It is submitted that Lim did not willfully expose himself to needless peril when he
pointed the gun to his temple because the fact is that he thought it was not unsafe to do so. The act was
precisely intended to assure Nalagon that the gun was indeed harmless.
The contrary view is expressed by the petitioner thus:
Accident insurance policies were never intended to reward the insured for his tendency to show off or
for his miscalculations. They were intended to provide for contingencies. Hence, when I miscalculate and
jump from the Quezon Bridge into the Pasig River in the belief that I can overcome the current, I have
wilfully exposed myself to peril and must accept the consequences of my act. If I drown I cannot go to
the insurance company to ask them to compensate me for my failure to swim as well as I thought I
could. The insured in the case at bar deliberately put the gun to his head and pulled the trigger. He
wilfully exposed himself to peril.
The Court certainly agrees that a drowned man cannot go to the insurance company to ask for
compensation. That might frighten the insurance people to death. We also agree that under the
circumstances narrated, his beneficiary would not be able to collect on the insurance policy for it is clear
that when he braved the currents below, he deliberately exposed himself to a known peril.
The private respondent maintains that Lim did not. That is where she says the analogy fails. The
petitioner's hypothetical swimmer knew when he dived off the Quezon Bridge that the currents below
were dangerous. By contrast, Lim did not know that the gun he put to his head was loaded.
Lim was unquestionably negligent and that negligence cost him his own life. But it should not prevent
his widow from recovering from the insurance policy he obtained precisely against accident. There is
nothing in the policy that relieves the insurer of the responsibility to pay the indemnity agreed upon if
the insured is shown to have contributed to his own accident. Indeed, most accidents are caused by
negligence. There are only four exceptions expressly made in the contract to relieve the insurer from
liability, and none of these exceptions is applicable in the case at bar. **
It bears noting that insurance contracts are as a rule supposed to be interpreted liberally in favor of the
assured. There is no reason to deviate from this rule, especially in view of the circumstances of this case
as above analyzed.
On the second assigned error, however, the Court must rule in favor of the petitioner. The basic issue
raised in this case is, as the petitioner correctly observed, one of first impression. It is evident that the
petitioner was acting in good faith then it resisted the private respondent's claim on the ground that the
death of the insured was covered by the exception. The issue was indeed debatable and was clearly not
raised only for the purpose of evading a legitimate obligation. We hold therefore that the award of
moral and exemplary damages and of attorney's fees is unjust and so must be disapproved.
In order that a person may be made liable to the payment of moral damages, the law requires that his
act be wrongful. The adverse result of an action does not per se make the act wrongful and subject the
act or to the payment of moral damages. The law could not have meant to impose a penalty on the right
to litigate; such right is so precious that moral damages may not be charged on those who may exercise
it erroneously. For these the law taxes costs. 7
The fact that the results of the trial were adverse to Barreto did not alone make his act in bringing the
action wrongful because in most cases one party will lose; we would be imposing an unjust condition or
limitation on the right to litigate. We hold that the award of moral damages in the case at bar is not
justified by the facts had circumstances as well as the law.
If a party wins, he cannot, as a rule, recover attorney's fees and litigation expenses, since it is not the
fact of winning alone that entitles him to recover such damages of the exceptional circumstances
enumerated in Art. 2208. Otherwise, every time a defendant wins, automatically the plaintiff must pay
attorney's fees thereby putting a premium on the right to litigate which should not be so. For those
expenses, the law deems the award of costs as sufficient. 8
WHEREFORE, the challenged decision of the Court of Appeals is AFFIRMED in so far as it holds the
petitioner liable to the private respondent in the sum of P200,000.00 representing the face value of the
insurance contract, with interest at the legal rate from the date of the filing of the complaint until the
full amount is paid, but MODIFIED with the deletion of all awards for damages, including attorney's fees,
except the costs of the suit.
SO ORDERED.
G.R. No. L-8151 December 16, 1955
VIRGINIA CALANOC, petitioner,
vs.
COURT OF APPEALS and THE PHILIPPINE AMERICAN LIFE INSURANCE CO., respondents.
Lucio Javillonar for petitioner.

J. A. Wolfson, Manuel Y. Mecias, Emilio Abello and Anselmo A. Reyes for respondents.
BAUTISTA ANGELO, J.:
This suit involves the collection of P2,000 representing the value of a supplemental policy covering
accidental death which was secured by one Melencio Basilio from the Philippine American Life Insurance
Company. The case originated in the Municipal Court of Manila and judgment being favorable to the
plaintiff it was appealed to the court of first instance. The latter court affirmed the judgment but on
appeal to the Court of Appeals the judgment was reversed and the case is now before us on a petition
for review.
Melencio Basilio was a watchman of the Manila Auto Supply located at the corner of Avenida Rizal and
Zurbaran. He secured a life insurance policy from the Philippine American Life Insurance Company in the
amount of P2,000 to which was attached a supplementary contract covering death by accident. On
January 25, 1951, he died of a gunshot wound on the occasion of a robbery committed in the house of
Atty. Ojeda at the corner of Oroquieta and Zurbaan streets. Virginia Calanoc, the widow, was paid the
sum of P2,000, face value of the policy, but when she demanded the payment of the additional sum of
P2,000 representing the value of the supplemental policy, the company refused alleging, as main
of the robbery and while making an arrest as an officer of the law which contingencies were expressly
excluded in the contract and have the effect of exempting the company from liability.
The pertinent facts which need to be considered for the determination of the questions raised are those
reproduced in the decision of the Court of Appeals as follows:
The circumstances surrounding the death of Melencio Basilio show that when he was killed at about
seven o'clock in the night of January 25, 1951, he was on duty as watchman of the Manila Auto Supply at
the corner of Avenida Rizal and Zurbaran; that it turned out that Atty. Antonio Ojeda who had his
residence at the corner of Zurbaran and Oroquieta, a block away from Basilio's station, had come home
that night and found that his house was well-lighted, but with the windows closed; that getting
suspicious that there were culprits in his house, Atty. Ojeda retreated to look for a policeman and
finding Basilio in khaki uniform, asked him to accompany him to the house with the latter refusing on
the ground that he was not a policeman, but suggesting that Atty. Ojeda should ask the traffic policeman
on duty at the corner of Rizal Avenue and Zurbaran; that Atty. Ojeda went to the traffic policeman at
said corner and reported the matter, asking the policeman to come along with him, to which the
policeman agreed; that on the way to the Ojeda residence, the policeman and Atty. Ojeda passed by
Basilio and somehow or other invited the latter to come along; that as the tree approached the Ojeda
residence and stood in front of the main gate which was covered with galvanized iron, the fence itself
being partly concrete and partly adobe stone, a shot was fired; that immediately after the shot, Atty.
Ojeda and the policeman sought cover; that the policeman, at the request of Atty. Ojeda, left the
premises to look for reinforcement; that it turned out afterwards that the special watchman Melencio
Basilio was hit in the abdomen, the wound causing his instantaneous death; that the shot must have
come from inside the yard of Atty. Ojeda, the bullet passing through a hole waist-high in the galvanized
iron gate; that upon inquiry Atty. Ojeda found out that the savings of his children in the amount of P30
in coins kept in his aparador contained in stockings were taken away, the aparador having been
ransacked; that a month thereafter the corresponding investigation conducted by the police authorities
led to the arrest and prosecution of four persons in Criminal Case No. 15104 of the Court of First
Instance of Manila for 'Robbery in an Inhabited House and in Band with Murder'.
It is contended in behalf of the company that Basilio was killed which "making an arrest as an officer of
the law" or as a result of an "assault or murder" committed in the place and therefore his death was
caused by one of the risks excluded by the supplementary contract which exempts the company from
liability. This contention was upheld by the Court of Appeals and, in reaching this conclusion, made the
following comment:
From the foregoing testimonies, we find that the deceased was a watchman of the Manila Auto Supply,
and, as such, he was not boud to leave his place and go with Atty. Ojeda and Policeman Magsanoc to see
the trouble, or robbery, that occurred in the house of Atty. Ojeda. In fact, according to the finding of the
lower court, Atty. Ojeda finding Basilio in uniform asked him to accompany him to his house, but the
latter refused on the ground that he was not a policeman and suggested to Atty. Ojeda to ask help from
the traffic policeman on duty at the corner of Rizal Avenue and Zurbaran, but after Atty. Ojeda secured
the help of the traffic policeman, the deceased went with Ojeda and said traffic policeman to the
residence of Ojeda, and while the deceased was standing in front of the main gate of said residence, he
was shot and thus died. The death, therefore, of Basilio, although unexpected, was not caused by an
accident, being a voluntary and intentional act on the part of the one wh robbed, or one of those who
robbed, the house of Atty. Ojeda. Hence, it is out considered opinion that the death of Basilio, though
unexpected, cannot be considered accidental, for his death occurred because he left his post and joined
policeman Magsanoc and Atty. Ojeda to repair to the latter's residence to see what happened thereat.
Certainly, when Basilio joined Patrolman Magsanoc and Atty. Ojeda, he should have realized the danger
to which he was exposing himself, yet, instead of remaining in his place, he went with Atty. Ojeda and
Patrolman Magsanoc to see what was the trouble in Atty. Ojeda's house and thus he was fatally shot.
We dissent from the above findings of the Court of Appeals. For one thing, Basilio was a watchman of
the Manila Auto Supply which was a block away from the house of Atty. Ojeda where something
suspicious was happening which caused the latter to ask for help. While at first he declined the
invitation of Atty. Ojeda to go with him to his residence to inquire into what was going on because he
was not a regular policeman, he later agreed to come along when prompted by the traffic policeman,
and upon approaching the gate of the residence he was shot and died. The circumstance that he was a
mere watchman and had no duty to heed the call of Atty. Ojeda should not be taken as a capricious
desire on his part to expose his life to danger considering the fact that the place he was in duty-bound to
guard was only a block away. In volunteering to extend help under the situation, he might have thought,
rightly or wrongly, that to know the truth was in the interest of his employer it being a matter that
affects the security of the neighborhood. No doubt there was some risk coming to him in pursuing that
errand, but that risk always existed it being inherent in the position he was holding. He cannot therefore
be blamed solely for doing what he believed was in keeping with his duty as a watchman and as a
citizen. And he cannot be considered as making an arrest as an officer of the law, as contended, simply
because he went with the traffic policeman, for certainly he did not go there for that purpose nor was
he asked to do so by the policeman.
this may be clarified in the criminal case now pending in court as regards the incident but before that is
away the people around for his own protection and not necessarily to kill or hit the victim. In any event,
while the act may not exempt the triggerman from liability for the damage done, the fact remains that
the happening was a pure accident on the part of the victim. The victim could have been either the
because he wanted to take his life.
We take note that these defenses are included among the risks excluded in the supplementary contract
which enumerates the cases which may exempt the company from liability. While as a general rule "the
parties may limit the coverage of the policy to certain particular accidents and risks or causes of loss,
and may expressly except other risks or causes of loss therefrom" (45 C. J. S. 781-782), however, it is to
be desired that the terms and phraseology of the exception clause be clearly expressed so as to be
within the easy grasp and understanding of the insured, for if the terms are doubtful or obscure the
same must of necessity be interpreted or resolved against the one who has caused the obscurity.
(Article 1377, new Civil Code) And so it has bene generally held that the "terms in an insurance policy,
which are ambiguous, equivocal, or uncertain . . . are to be construed strictly and most strongly against
the insurer, and liberally in favor of the insured so as to effect the dominant purpose of indemnity or
payment to the insured, especially where a forfeiture is involved" (29 Am. Jur., 181), and the reason for
this rule is that he "insured usually has no voice in the selection or arrangement of the words employed
and that the language of the contract is selected with great care and deliberation by experts and legal
advisers employed by, and acting exclusively in the interest of, the insurance company." (44 C. J. S., p.
1174.)
experts who know and can anticipate the bearings and possible complications of every contingency. So
purchase insurance, construe every ambiguity in favor of the insured. (Algoe vs. Pacific Mut. L. Ins. Co.,
91 Wash. 324, LRA 1917A, 1237.)
An insurer should not be allowed, by the use of obscure phrases and exceptions, to defeat the very
purpose for which the policy was procured. (Moore vs. Aetna Life Insurance Co., LRA 1915D, 264.)
We are therefore persuaded to conclude that the circumstances unfolded in the present case do not
warrant the finding that the death of the unfortunate victim comes within the purview of the exception
clause of the supplementary policy and, hence, do not exempt the company from liability.
Wherefore, reversing the decision appealed from, we hereby order the company to pay petitioner-
appellant the amount of P2,000, with legal interest from January 26, 1951 until fully paid, with costs.
G.R. No. 85296 May 14, 1990
ZENITH INSURANCE CORPORATION, petitioner,

vs.
COURT OF APPEALS and LAWRENCE FERNANDEZ, respondents.
Vicente R. Layawen for petitioner.
Lawrence L. Fernandez & Associates for private respondent.
MEDIALDEA, J.:
Assailed in this petition is the decision of the Court of Appeals in CA-G.R. C.V. No. 13498 entitled,
"Lawrence L. Fernandez, plaintiff-appellee v. Zenith Insurance Corp., defendant-appellant" which
affirmed in toto the decision of the Regional Trial Court of Cebu, Branch XX in Civil Case No. CEB-1215
and the denial of petitioner's Motion for Reconsideration.
The antecedent facts are as follows:
On January 25, 1983, private respondent Lawrence Fernandez insured his car for "own damage" under
private car Policy No. 50459 with petitioner Zenith Insurance Corporation. On July 6, 1983, the car
figured in an accident and suffered actual damages in the amount of P3,640.00. After allegedly being
given a run around by Zenith for two (2) months, Fernandez filed a complaint with the Regional Trial
Court of Cebu for sum of money and damages resulting from the refusal of Zenith to pay the amount
claimed. The complaint was docketed as Civil Case No. CEB-1215. Aside from actual damages and
interests, Fernandez also prayed for moral damages in the amount of P10,000.00, exemplary damages
of P5,000.00, attorney's fees of P3,000.00 and litigation expenses of P3,000.00.
On September 28, 1983, Zenith filed an answer alleging that it offered to pay the claim of Fernandez
pursuant to the terms and conditions of the contract which, the private respondent rejected. After the
issues had been joined, the pre-trial was scheduled on October 17, 1983 but the same was moved to
November 4, 1983 upon petitioner's motion, allegedly to explore ways to settle the case although at an
amount lower than private respondent's claim. On November 14, 1983, the trial court terminated the
pre-trial. Subsequently, Fernandez presented his evidence. Petitioner Zenith, however, failed to present
its evidence in view of its failure to appear in court, without justifiable reason, on the day scheduled for
the purpose. The trial court issued an order on August 23, 1984 submitting the case for decision without
Zenith's evidence (pp. 10-11, Rollo). Petitioner filed a petition for certiorari with the Court of Appeals
assailing the order of the trial court submitting the case for decision without petitioner's evidence. The
petition was docketed as C.A.-G.R. No. 04644. However, the petition was denied due course on April 29,
1986 (p. 56, Rollo).
On June 4, 1986, a decision was rendered by the trial court in favor of private respondent Fernandez.
The dispositive portion of the trial court's decision provides:
WHEREFORE, defendant is hereby ordered to pay to the plaintiff:
1. The amount of P3,640.00 representing the damage incurred plus interest at the rate of twice the
prevailing interest rates;
2. The amount of P20,000.00 by way of moral damages;
3. The amount of P20,000.00 by way of exemplary damages;
4. The amount of P5,000.00 as attorney's fees;
5. The amount of P3,000.00 as litigation expenses; and
6. Costs. (p. 9, Rollo)
Upon motion of Fernandez and before the expiration of the period to appeal, the trial court, on June 20,
1986, ordered the execution of the decision pending appeal. The order was assailed by petitioner in a
petition for certiorariwith the Court of Appeals on October 23, 1986 in C.A. G.R. No. 10420 but which
petition was also dismissed on December 24, 1986 (p. 69, Rollo).
On June 10, 1986, petitioner filed a notice of appeal before the trial court. The notice of appeal was
granted in the same order granting private respondent's motion for execution pending appeal. The
appeal to respondent court assigned the following errors:
I. The lower court erred in denying defendant appellant to adduce evidence in its behalf.
II. The lower court erred in ordering Zenith Insurance Corporation to pay the amount of P3,640.00 in its
decision.
III. The lower court erred in awarding moral damages, attorneys fees and exemplary damages, the worst
is that, the court awarded damages more than what are prayed for in the complaint. (p. 12, Rollo)
On August 17, 1988, the Court of Appeals rendered its decision affirming in toto the decision of the trial
court. It also ruled that the matter of the trial court's denial of Fernandez's right to adduce evidence is a
closed matter in view of its (CA) ruling in AC-G.R. 04644 wherein Zenith's petition questioning the trial
court's order submitting the case for decision without Zenith's evidence, was dismissed.
The Motion for Reconsideration of the decision of the Court of Appeals dated August 17, 1988 was
denied on September 29, 1988, for lack of merit. Hence, the instant petition was filed by Zenith on
October 18, 1988 on the allegation that respondent Court of Appeals' decision and resolution ran
counter to applicable decisions of this Court and that they were rendered without or in excess of
jurisdiction. The issues raised by petitioners in this petition are:
a) The legal basis of respondent Court of Appeals in awarding moral damages, exemplary damages and
attomey's fees in an amount more than that prayed for in the complaint.
b) The award of actual damages of P3,460.00 instead of only P1,927.50 which was arrived at after
deducting P250.00 and P274.00 as deductible franchise and 20% depreciation on parts as agreed upon
in the contract of insurance.
Petitioner contends that while the complaint of private respondent prayed for P10,000.00 moral
damages, the lower court awarded twice the amount, or P20,000.00 without factual or legal basis; while
private respondent prayed for P5,000.00 exemplary damages, the trial court awarded P20,000.00; and
while private respondent prayed for P3,000.00 attorney's fees, the trial court awarded P5,000.00.
The propriety of the award of moral damages, exemplary damages and attorney's fees is the main issue
raised herein by petitioner.
The award of damages in case of unreasonable delay in the payment of insurance claims is governed by
the Philippine Insurance Code, which provides:
Sec. 244. In case of any litigation for the enforcement of any policy or contract of insurance, it shall be
the duty of the Commissioner or the Court, as the case may be, to make a finding as to whether the
payment of the claim of the insured has been unreasonably denied or withheld; and in the affirmative
case, the insurance company shall be adjudged to pay damages which shall consist of attomey's fees and
other expenses incurred by the insured person by reason of such unreasonable denial or withholding of
payment plus interest of twice the ceiling prescribed by the Monetary Board of the amount of the claim
due the insured, from the date following the time prescribed in section two hundred forty-two or in
section two hundred forty-three, as the case may be, until the claim is fully satisfied; Provided, That the
failure to pay any such claim within the time prescribed in said sections shall be considered prima
facie evidence of unreasonable delay in payment.
It is clear that under the Insurance Code, in case of unreasonable delay in the payment of the proceeds
of an insurance policy, the damages that may be awarded are: 1) attorney's fees; 2) other expenses
incurred by the insured person by reason of such unreasonable denial or withholding of payment; 3)
interest at twice the ceiling prescribed by the Monetary Board of the amount of the claim due the
injured; and 4) the amount of the claim.
As regards the award of moral and exemplary damages, the rules under the Civil Code of the Philippines
shall govern.
"The purpose of moral damages is essentially indemnity or reparation, not punishment or correction.
Moral damages are emphatically not intended to enrich a complainant at the expense of a defendant,
they are awarded only to enable the injured party to obtain means, diversions or amusements that will
serve to alleviate the moral suffering he has undergone by reason of the defendant's culpable action." (J.
Cezar S. Sangco, Philippine Law on Torts and Damages, Revised Edition, p. 539) (See also R and B Surety
& Insurance Co., Inc. v. IAC, G.R. No. 64515, June 22, 1984; 129 SCRA 745). While it is true that no proof
of pecuniary loss is necessary in order that moral damages may be adjudicated, the assessment of which
is left to the discretion of the court according to the circumstances of each case (Art. 2216, New Civil
Code), it is equally true that in awarding moral damages in case of breach of contract, there must be a
showing that the breach was wanton and deliberately injurious or the one responsible acted fraudently
or in bad faith (Perez v. Court of Appeals, G.R. No. L-20238, January 30,1965; 13 SCRA 137; Solis v.
Salvador, G.R. No. L-17022, August 14, 1965; 14 SCRA 887). In the instant case, there was a finding that
private respondent was given a "run-around" for two months, which is the basis for the award of the
damages granted under the Insurance Code for unreasonable delay in the payment of the claim.
However, the act of petitioner of delaying payment for two months cannot be considered as so wanton
or malevolent to justify an award of P20,000.00 as moral damages, taking into consideration also the
fact that the actual damage on the car was only P3,460. In the pre-trial of the case, it was shown that
there was no total disclaimer by respondent. The reason for petitioner's failure to indemnify private
respondent within the two-month period was that the parties could not come to an agreement as
regards the amount of the actual damage on the car. The amount of P10,000.00 prayed for by private
respondent as moral damages is equitable.
On the other hand, exemplary or corrective damages are imposed by way of example or correction for
the public good (Art. 2229, New Civil Code of the Philippines). In the case of Noda v. Cruz-Arnaldo, G.R.
No. 57322, June 22,1987; 151 SCRA 227, exemplary damages were not awarded as the insurance
company had not acted in wanton, oppressive or malevolent manner. The same is true in the case at
bar.
The amount of P5,000.00 awarded as attomey's fees is justified under the circumstances of this case
considering that there were other petitions filed and defended by private respondent in connection with
this case.
As regards the actual damages incurred by private respondent, the amount of P3,640.00 had been
established before the trial court and affirmed by the appellate court. Respondent appellate court
correctly ruled that the deductions of P250.00 and P274.00 as deductible franchise and 20%
depreciation on parts, respectively claimed by petitioners as agreed upon in the contract, had no basis.
Respondent court ruled:
Under its second assigned error, defendant-appellant puts forward two arguments, both of which are
entirely without merit. It is contented that the amount recoverable under the insurance policy
defendant-appellant issued over the car of plaintiff-appellee is subject to deductible franchise, and . . . .
The policy (Exhibit G, pp. 4-9, Record), does not mntion any deductible franchise, . . . (p. 13, Rollo)
Therefore, the award of moral damages is reduced to P10,000.00 and the award of exemplary damages
is hereby deleted. The awards due to private respondent Fernandez are as follows:
1) P3,640.00 as actual claim plus interest of twice the ceiling prescribed by the Monetary Board
computed from the time of submission of proof of loss;
2) P10,000.00 as moral damages;
3) P5,000.00 as attorney's fees;
4) P3,000.00 as litigation expenses; and
5) Costs.
ACCORDINGLY, the appealed decision is MODIFIED as above stated.

SO ORDERED.
G.R. No. L-60887 November 13, 1991
PERLA COMPANIA DE SEGUROS, INC., petitioner,

vs.
HON. JOSE R. RAMOLETE, PRIMITIVA Y. PALMES, HONORATO BORBON, SR., OFFICE OF THE
PROVINCIAL SHERIFF, PROVINCE OF CEBU, respondents.
Hector L. Fernandez for petitioner.
Domingo Quibranza and Vicente A. Quibranza for private respondents.
FELICIANO, J.:
The present Petition for Certiorari seeks to annul: (a) the Order dated 6 August 1979 1 which ordered the
Provincial Sheriff to garnish the third-party liability insurance policy issued by petitioner Perla Compania
de Seguros, Inc. ("Perla") in favor of Nelia Enriquez, judgment debtor in Civil Case No. R-15391; (b) the
Order dated 24 October 1979 2 which denied the motion for reconsideration of the 6 August 1979 Order;
and (c) the Order dated 8 April 19803 which ordered the issuance of an alias writ of garnishment against
petitioner.
In the afternoon of 1 June 1976, a Cimarron PUJ owned and registered in the name of Nelia Enriquez,
and driven by Cosme Casas, was travelling from Cebu City to Danao City. While passing through Liloan,
Cebu, the Cimarron PUJ collided with a private jeep owned by the late Calixto Palmes (husband of
private respondent Primitiva Palmes) who was then driving the private jeep. The impact of the collision
was such that the private jeep was flung away to a distance of about thirty (30) feet and then fell on its
right side pinning down Calixto Palmes. He died as a result of cardio-respiratory arrest due to a crushed
chest. 4 The accident also caused physical injuries on the part of Adeudatus Borbon who was then only
two (2) years old.
On 25 June 1976, private respondents Primitiva Palmes (widow of Calixto Palmes) and Honorato Borbon,
Sr. (father of minor Adeudatus Borbon) filed a complaint 5 against Cosme Casas and Nelia Enriquez
(assisted by her husband Leonardo Enriquez) before the then Court of First Instance of Cebu, Branch 3,
claiming actual, moral, nominal and exemplary damages as a result of the accident.
The claim of private respondent Honorato Borbon, Sr., being distinct and separate from that of co-
plaintiff Primitiva Palmes, and the amount thereof falling properly within the jurisdiction of the inferior
court, respondent Judge Jose R. Ramolete ordered the Borbon claim excluded from the complaint,
without prejudice to its being filed with the proper inferior court.
On 4 April 1977, the Court of First Instance rendered a Decision 6 in favor of private respondent Primitiva
Palmes, ordering common carrier Nelia Enriquez to pay her P10,000.00 as moral damages, P12,000.00 as
compensatory damages for the death of Calixto Palmes, P3,000.00 as exemplary damages, P5,000.00 as
actual damages, and P1,000.00 as attorney's fees.
The judgment of the trial court became final and executory and a writ of execution was thereafter
issued. The writ of execution was, however, returned unsatisfied. Consequently, the judgment debtor
Nelia Enriquez was summoned before the trial court for examination on 23 July 1979. She declared
under oath that the Cimarron PUJ registered in her name was covered by a third-party liability insurance
policy issued by petitioner Perla.
Thus, on 31 July 1979, private respondent Palmes filed a motion for garnishment 7 praying that an order
of garnishment be issued against the insurance policy issued by petitioner in favor of the judgment
debtor. On 6 August 1979, respondent Judge issued an Order 8 directing the Provincial Sheriff or his
deputy to garnish the third-party liability insurance policy.
Petitioner then appeared before the trial court and moved for reconsideration of the 6 August 1979
Order and for quashal of the writ of garnishment, 9 alleging that the writ was void on the ground that it
(Perla) was not a party to the case and that jurisdiction over its person had never been acquired by the
trial court by service of summons or by any process. The trial court denied petitioner's motion. 10 An
Order for issuance of an alias writ of garnishment was subsequently issued on 8 April 1980. 11
More than two (2) years later, the present Petition for Certiorari and Prohibition was filed with this Court on 25 June 1982 alleging
grave abuse of discretion on the part of respondent Judge Ramolete in ordering garnishment of the third-party liability insurance
contract issued by petitioner Perla in favor of the judgment debtor, Nelia Enriquez. The Petition should have been dismissed
forthwith for having been filed way out of time but, for reasons which do not appear on the record, was nonetheless entertained.
In this Petition, petitioner Perla reiterates its contention that its insurance contract cannot be subjected to garnishment or
execution to satisfy the judgment in Civil Case No. R-15391 because petitioner was not a party to the case and the trial court did not
acquire jurisdiction over petitioner's person. Perla further argues that the writ of garnishment had been issued solely on the basis of
the testimony of the judgment debtor during the examination on 23 July 1979 to the effect that the Cimarron PUJ was covered by a
third-party liability insurance issued by Perla, without granting it the opportunity to set up any defenses which it may have under
the insurance contract; and that the proceedings taken against petitioner are contrary to the procedure laid down in Economic
Insurance Company, Inc. v. Torres, et al., 12
which held that under Rule 39, Section 45, the Court "may only
authorize" the judgment creditor to institute an action against a third person who holds property
belonging to the judgment debtor.
We find no grave abuse of discretion or act in excess of or without jurisdiction on the part of respondent
Judge Ramolete in ordering the garnishment of the judgment debtor's third-party liability insurance.
Garnishment has been defined as a species of attachment for reaching any property or credits pertaining
or payable to a judgment debtor. 13 In legal contemplation, it is a forced novation by the substitution of
creditors: 14 the judgment debtor, who is the original creditor of the garnishee is, through service of the
writ of garnishment, substituted by the judgment creditor who thereby becomes creditor of the
garnishee. Garnishment has also been described as a warning to a person having in his possession
property or credits of the judgment debtor, not to pay the money or deliver the property to the latter,
but rather to appear and answer the plaintiff's suit. 15
In order that the trial court may validly acquire jurisdiction to bind the person of the garnishee, it is not necessary that summons be
served upon him. The garnishee need not be impleaded as a party to the case. All that is necessary for the trial court lawfully to bind
the person of the garnishee or any person who has in his possession credits belonging to the judgment debtor is service upon him of
the writ of garnishment.
The Rules of Court themselves do not require that the garnishee be served with summons or impleaded in the case in order to make
him liable.
Rule 39, Section 15 provides:
Sec. 15. Execution of money judgments. — The officer must enforce an execution of a money judgment by levying on all the
property, real or personal of every name and nature whatsoever, and which may be disposed of for value, of the judgment debtor
not exempt from execution . . .
Real property, stocks, shares, debts, credits, and other personal property, or any interest in either real or personal property, may
be levied on in like manner and with like effect as under a writ of attachment.(Emphasis supplied).
Rule 57, Section 7(e) in turn reads:
Sec. 7. Attachment of real and personal property; recording thereof. — Properties shall be attached by the officer executing the
order in the following manner:
x x x x x x x x x
(e) Debts and credits, and other personal property not capable of manual delivery, by leaving with the person owing such debts, or
having his possession or under his control such credits or other personal property, or with his agent, a copy of the order, and notice
that the debts owing by him to the party against whom attachment is issued, and the credits and other personal property in his
possession, or under his control, belonging to said party, are attached in pursuance of such order;
x x x x x x x x x
(Emphasis supplied)
Through service of the writ of garnishment, the garnishee becomes a "virtual party" to, or a "forced intervenor" in, the case and the
trial court thereby acquires jurisdiction to bind him to compliance with all orders and processes of the trial court with a view to the
complete satisfaction of the judgment of the court. In Bautista v. Barredo, 16

the Court, through Mr. Justice Bautista
Angelo, held:
While it is true that defendant Jose M. Barredo was not a party in Civil Case No. 1636 when it was
instituted by appellant against the Philippine Ready Mix Concrete Company, Inc., however, jurisdiction
was acquired over him by the court and he became a virtual party to the case when, after final judgment
was rendered in said case against the company, the sheriff served upon him a writ of garnishment in
behalf of appellant. Thus, as held by this Court in the case of Tayabas Land Company vs. Sharruf, 41 Phil.
382, the proceeding by garnishment is a species of attachment for reaching credits belonging to the
judgment debtor and owing to him from a stranger to the litigation. By means of the citation, the
stranger becomes a forced intervenor; and the court, having acquired jurisdiction over him by means of
the citation, requires him to pay his debt, not to his former creditor, but to the new creditor, who is
creditor in the main litigation. (Emphasis supplied).
In Rizal Commercial Banking Corporation v. De Castro, 17 the Court stressed that the asset or credit
garnished is thereupon subjected to a specific lien:
The garnishment of property to satisfy a writ of execution operates as an attachment and fastens upon
the property a lien by which the property is brought under the jurisdiction of the court issuing the writ. It
is brought into custodia legis, under the sole control of such
18 (Emphasis supplied)
court.
In the present case, there can be no doubt, therefore, that the trial court actually acquired jurisdiction over petitioner Perla when it
was served with the writ of garnishment of the third-party liability insurance policy it had issued in favor of judgment debtor Nelia
Enriquez. Perla cannot successfully evade liability thereon by such a contention.
Every interest which the judgment debtor may have in property may be subjected to execution. 19
In the instant case, the
judgment debtor Nelia Enriquez clearly had an interest in the proceeds of the third-party liability
insurance contract. In a third-party liability insurance contract, the insurer assumes the obligation of
paying the injured third party to whom the insured is liable. 20 The insurer becomes liable as soon as the
liability of the insured to the injured third person attaches. Prior payment by the insured to the injured
third person is not necessary in order that the obligation of the insurer may arise. From the moment
that the insured became liable to the third person, the insured acquired an interest in the insurance
contract, which interest may be garnished like any other credit. 21
Petitioner also contends that in order that it may be held liable under the third-party liability insurance, a separate action should
have been commenced by private respondents to establish petitioner's liability. Petitioner invokes Economic Insurance Company,
Inc. vs. Torres, 22

which stated:
It is clear from Section 45, Rule 39 that if a persons alleged to have property of the judgment debtor or to
be indebted to him claims an interest in the property adverse to him or denies the debt, the court may
only authorize the judgment creditor to institute an action against such person for the recovery of such
interest or debt. Said section does not authorize the court to make a finding that the third person has in
his possession property belonging to the judgment debtor or is indebted to him and to order said third
person to pay the amount to the judgment creditor.
It has been held that the only power of the court in proceedings supplemental to execution is to niake an
order authorizing the creditor to sue in the proper court to recover an indebtedness due to the judgment
debtor. The court has no jurisdiction to try summarily the question whether the third party served with
notice of execution and levy is indebted to defendant when such indebtedness is denied. To make an
order in relation to property which the garnishee claimed to own in his own right, requiring its
application in satisfaction of judgment of another, would be to deprive the garnishee of property upon
summary proceeding and without due process of law. (Emphasis supplied)
But reliance by petitioner on the case of Economic Insurance Company, Inc. v. Torres (supra) is
misplaced. The Court there held that a separate action needs to be commenced when the garnishee
"claims an interest in the property adverse to him (judgment debtor) or denies the debt. " In the instant
case, petitioner Perla did not deny before the trial court that it had indeed issued a third-party liability
insurance policy in favor of the judgment debtor. Petitioner moreover refrained from setting up any
substantive defense which it might have against the insured-judgment debtor. The only ground asserted
by petitioner in its "Motion for Reconsideration of the Order dated August 6, 1979 and to Quash Notice
of Garnishment" was lack of jurisdiction of the trial court for failure to implead it in the case by serving it
with summons. Accordingly, Rule 39, Section 45 of the Rules of Court is not applicable in the instant
case, and we see no need to require a separate action against Perla: a writ of garnishment suffices to
hold petitioner answerable to the judgment creditor. If Perla had any substantive defenses against the
judgment debtor, it is properly deemed to have waived them by laches.
WHEREFORE, the Petition for Certiorari and Prohibition is hereby DISMISSED for having been filed out of
time and for lack of merit. The assailed Orders of the trial court are hereby AFFIRMED. Costs against
petitioner. This Decision is immediately executory.
SO ORDERED.
G.R. No. L-54171 October 28, 1980
JEWEL VILLACORTA, assisted by her husband, GUERRERO VILLACORTA, petitioner,

vs.
THE INSURANCE COMMISSION and EMPIRE INSURANCE COMPANY, respondents.
TEEHANKEE, Acting C.J.:
The Court sets aside respondent Insurance Commission's dismissal of petitioner's complaint and holds
that where the insured's car is wrongfully taken without the insured's consent from the car service and
repair shop to whom it had been entrusted for check-up and repairs (assuming that such taking was for
a joy ride, in the course of which it was totally smashed in an accident), respondent insurer is liable and
must pay insured for the total loss of the insured vehicle under the theft clause of the policy.
The undisputed facts of the case as found in the appealed decision of April 14, 1980 of respondent
insurance commission are as follows:
Complainant [petitioner] was the owner of a Colt Lancer, Model 1976, insured with respondent
company under Private Car Policy No. MBI/PC-0704 for P35,000.00 — Own Damage; P30,000.00 —
Theft; and P30,000.00 — Third Party Liability, effective May 16, 1977 to May 16, 1978. On May 9, 1978,
the vehicle was brought to the Sunday Machine Works, Inc., for general check-up and repairs. On May
11, 1978, while it was in the custody of the Sunday Machine Works, the car was allegedly taken by six (6)
persons and driven out to Montalban, Rizal. While travelling along Mabini St., Sitio Palyasan, Barrio
Burgos, going North at Montalban, Rizal, the car figured in an accident, hitting and bumping a gravel and
sand truck parked at the right side of the road going south. As a consequence, the gravel and sand truck
veered to the right side of the pavement going south and the car veered to the right side of the
pavement going north. The driver, Benito Mabasa, and one of the passengers died and the other four
sustained physical injuries. The car, as well, suffered extensive damage. Complainant, thereafter, filed a
claim for total loss with the respondent company but claim was denied. Hence, complainant, was
compelled to institute the present action.
The comprehensive motor car insurance policy for P35,000.00 issued by respondent Empire Insurance
Company admittedly undertook to indemnify the petitioner-insured against loss or damage to the car (a)
by accidental collision or overturning, or collision or overturning consequent upon mechanical
breakdown or consequent upon wear and tear; (b) by fire, external explosion, self-ignition or lightning or
burglary, housebreaking or theft; and (c) by malicious act.
Respondent insurance commission, however, dismissed petitioner's complaint for recovery of the total
loss of the vehicle against private respondent, sustaining respondent insurer's contention that the
accident did not fall within the provisions of the policy either for the Own Damage or Theft coverage,
invoking the policy provision on "Authorized Driver" clause.1
Respondent commission upheld private respondent's contention on the "Authorized Driver" clause in
this wise: "It must be observed that under the above-quoted provisions, the policy limits the use of the
insured vehicle to two (2) persons only, namely: the insured himself or any person on his (insured's)
permission. Under the second category, it is to be noted that the words "any person' is qualified by the
phrase
... on the insured's order or with his permission.' It is therefore clear that if the person driving is other
than the insured, he must have been duly authorized by the insured, to drive the vehicle to make the
insurance company liable for the driver's negligence. Complainant admitted that she did not know the
person who drove her vehicle at the time of the accident, much less consented to the use of the same
(par. 5 of the complaint). Her husband likewise admitted that he neither knew this driver Benito Mabasa
(Exhibit '4'). With these declarations of complainant and her husband, we hold that the person who
drove the vehicle, in the person of Benito Mabasa, is not an authorized driver of the complainant.
Apparently, this is a violation of the 'Authorized Driver' clause of the policy.
Respondent commission likewise upheld private respondent's assertion that the car was not stolen and
therefore not covered by the Theft clause, ruling that "The element of 'taking' in Article 308 of the
Revised Penal Code means that the act of depriving another of the possession and dominion of a
movable thing is coupled ... with the intention. at the time of the 'taking', of withholding it with the
character of permanency (People vs. Galang, 7 Appt. Ct. Rep. 13). In other words, there must have been
shown a felonious intent upon the part of the taker of the car, and the intent must be an intent
permanently to deprive the insured of his car," and that "Such was not the case in this instance. The fact
that the car was taken by one of the residents of the Sunday Machine Works, and the withholding of the
same, for a joy ride should not be construed to mean 'taking' under Art. 308 of the Revised Penal Code.
If at all there was a 'taking', the same was merely temporary in nature. A temporary taking is held not a
taking insured against (48 A LR 2d., page 15)."
The Court finds respondent commission's dismissal of the complaint to be contrary to the evidence and
the law.
First, respondent commission's ruling that the person who drove the vehicle in the person of Benito
Mabasa, who, according to its finding, was one of the residents of the Sunday Machine Works, Inc. to
whom the car had been entrusted for general check-up and repairs was not an "authorized driver" of
petitioner-complainant is too restrictive and contrary to the established principle that insurance
contracts, being contracts of adhesion where the only participation of the other party is the signing of
his signature or his "adhesion" thereto, "obviously call for greater strictness and vigilance on the part of
courts of justice with a view of protecting the weaker party from abuse and imposition, and prevent
their becoming traps for the unwary.2
The main purpose of the "authorized driver" clause, as may be seen from its text, supra, is that a person
other than the insured owner, who drives the car on the insured's order, such as his regular driver, or
with his permission, such as a friend or member of the family or the employees of a car service or repair
shop must be duly licensed drivers and have no disqualification to drive a motor vehicle.
A car owner who entrusts his car to an established car service and repair shop necessarily entrusts his
car key to the shop owner and employees who are presumed to have the insured's permission to drive
the car for legitimate purposes of checking or road-testing the car. The mere happenstance that the
employee(s) of the shop owner diverts the use of the car to his own illicit or unauthorized purpose in
violation of the trust reposed in the shop by the insured car owner does not mean that the "authorized
driver" clause has been violated such as to bar recovery, provided that such employee is duly qualified
to drive under a valid driver's license.
The situation is no different from the regular or family driver, who instead of carrying out the owner's
order to fetch the children from school takes out his girl friend instead for a joy ride and instead wrecks
the car. There is no question of his being an "authorized driver" which allows recovery of the loss
although his trip was for a personal or illicit purpose without the owner's authorization.
Secondly, and independently of the foregoing (since when a car is unlawfully taken, it is the theft clause,
not the "authorized driver" clause, that applies), where a car is admittedly as in this case unlawfully and
wrongfully taken by some people, be they employees of the car shop or not to whom it had been
entrusted, and taken on a long trip to Montalban without the owner's consent or knowledge, such
taking constitutes or partakes of the nature of theft as defined in Article 308 of the Revised Penal Code,
viz. "Who are liable for theft. — Theft is committed by any person who, with intent to gain but without
violence against or intimidation of persons nor force upon things, shall take personal property of
another without the latter's consent," for purposes of recovering the loss under the policy in question.
The Court rejects respondent commission's premise that there must be an intent on the part of the
taker of the car "permanently to deprive the insured of his car" and that since the taking here was for a
"joy ride" and "merely temporary in nature," a "temporary taking is held not a taking insured against."
The evidence does not warrant respondent commission's findings that it was a mere "joy ride". From the
very investigator's report cited in its comment, 3 the police found from the waist of the car driver Benito
Mabasa Bartolome who smashed the car and was found dead right after the incident "one cal. 45 Colt.
and one apple type grenade," hardly the materials one would bring along on a "joy ride". Then, again, it
is equally evident that the taking proved to be quite permanent rather than temporary, for the car was
totally smashed in the fatal accident and was never returned in serviceable and useful condition to
petitioner-owner.
Assuming, despite the totally inadequate evidence, that the taking was "temporary" and for a "joy ride",
the Court sustains as the better view that which holds that when a person, either with the object of
going to a certain place, or learning how to drive, or enjoying a free ride, takes possession of a vehicle
belonging to another, without the consent of its owner, he is guilty of theft because by taking possession
of the personal property belonging to another and using it, his intent to gain is evident since he derives
therefrom utility, satisfaction, enjoyment and pleasure. Justice Ramon C. Aquino cites in his work
Groizard who holds that the use of a thing constitutes gain and Cuello Calon who calls it "hurt de uso. " 4
The insurer must therefore indemnify the petitioner-owner for the total loss of the insured car in the
sum of P35,000.00 under the theft clause of the policy, subject to the filing of such claim for
reimbursement or payment as it may have as subrogee against the Sunday Machine Works, Inc.
ACCORDINGLY, the appealed decision is set aside and judgment is hereby rendered sentencing private
respondent to pay petitioner the sum of P35,000.00 with legal interest from the filing of the complaint
until full payment is made and to pay the costs of suit.
SO ORDERED.
G.R. No. 173773 November 28, 2012
PARAMOUNT INSURANCE CORPORATION, Petitioner,

vs.
SPOUSES YVES and MARIA TERESA REMONDEULAZ, Respondents.
DECISION
PERALTA, J.:
Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court seeking the reversal
and setting aside of the Decision 1 dated April 12, 2005 and Resolution2 dated July 20, 2006 of the Court
of Appeals in CA-G.R. CV No. 61490.
The undisputed facts follow.
On May 26, 1994, respondents insured with petitioner their 1994
Toyota Corolla sedan under a comprehensive motor vehicle insurance policy for one year.
During the effectivity of said insurance, respondents’ car was unlawfully taken. Hence, they immediately
reported the theft to the Traffic Management Command of the PNP who made them accomplish a
complaint sheet. In said complaint sheet, respondents alleged that a certain Ricardo Sales (Sales) took
possession of the subject vehicle to add accessories and improvements thereon, however, Sales failed to
return the subject vehicle within the agreed three-day period.
As a result, respondents notified petitioner to claim for the reimbursement of their lost vehicle.
However, petitioner refused to pay.
Accordingly, respondents lodged a complaint for a sum of money against petitioner before the Regional
Trial Court of Makati City (trial court) praying for the payment of the insured value of their car plus
damages on April 21, 1995.
After presentation of respondents’ evidence, petitioner filed a Demurrer to Evidence.

Acting thereon, the trial court dismissed the complaint filed by respondents. The full text of said
Order3 reads:
Before the Court is an action filed by the plaintiffs, spouses Yves and Maria Teresa Remondeulaz against
the defendant, Paramount Insurance Corporation, to recover from the defendant the insured value of
the motor vehicle.
It appears that on 26 May 1994, plaintiffs insured their vehicle, a 1994 Toyota Corolla XL with chassis
number EE-100-9524505, with defendant under Private Car Policy No. PC-37396 for Own Damage, Theft,
Third-Party Property Damage and Third-Party Personal Injury, for the period commencing 26 May 1994
to 26 May 1995. Then on 1 December 1994, defendants received from plaintiff a demand letter asking
for the payment of the proceeds in the amount of PhP409,000.00 under their policy. They alleged the
loss of the vehicle and claimed the same to be covered by the policy’s provision on "Theft." Defendant
disagreed and refused to pay.
It appears, however, that plaintiff had successfully prosecuted and had been awarded the amount
claimed in this action, in another action (Civil Case No. 95-1524 entitled Sps. Yves and Maria Teresa
Remondeulaz versus Standard Insurance Company, Inc.), which involved the loss of the same vehicle
under the same circumstances although under a different policy and insurance company. This,
considered with the principle that an insured may not recover more than its interest in any property
subject of an insurance, leads the court to dismiss this action.
SO ORDERED.4
Not in conformity with the trial court’s Order, respondents interposed an appeal to the Court of Appeals
(appellate court).
In its Decision dated April 12, 2005, the appellate court reversed and set aside the Order issued by the
trial court, to wit:
Indeed, the trial court erred when it dismissed the action on the ground of double recovery since it is
clear that the subject car is different from the one insured with another insurance company, the
Standard Insurance Company. In this case, defendant-appellee herein petitioner denied the
reimbursement for the lost vehicle on the ground that the said loss could not fall within the concept of
the "theft clause" under the insurance policy x x x
xxxx
WHEREFORE, the October 7, 1998 Order of the Regional Trial Court of Makati City, Branch 63, is hereby
REVERSED and SET ASIDE
x x x.
SO ORDERED.5
Petitioner, thereafter, filed a motion for reconsideration against said Decision, but the same was denied
by the appellate court in a Resolution dated July 20, 2006.
Consequently, petitioner filed a petition for review on certiorari before this Court praying that the
appellate court’s Decision and Resolution be reversed and set aside.
In its petition, petitioner raises this issue for our resolution:
Whether or not the Court of Appeals decided the case a quo in a way not in accord with law and/or
applicable jurisprudence when it promulgated in favor of the respondents Remondeulaz, making
Paramount liable for the alleged "theft" of respondents’ vehicle.6
Essentially, the issue is whether or not petitioner is liable under the insurance policy for the loss of
respondents’ vehicle.
Petitioner argues that the loss of respondents’ vehicle is not a peril covered by the policy. It maintains
that it is not liable for the loss, since the car cannot be classified as stolen as respondents entrusted the
possession thereof to another person.
We do not agree.
Adverse to petitioner’s claim, respondents’ policy clearly undertook to indemnify the insured against
loss of or damage to the scheduled vehicle when caused by theft, to wit:
SECTION III – LOSS OR DAMAGE
1. The Company will, subject to the Limits of Liability, indemnify the insured against loss of or damage to
the Scheduled Vehicle and its accessories and spare parts whilst thereon: –
(a) by accidental collision or overturning, or collision or overturning consequent upon mechanical

breakdown or consequent upon wear and tear;
(b) by fire, external explosion, self-ignition or lightning or burglary, housebreaking or theft;
(c) by malicious act;
(d) whilst in transit (including the process of loading and unloading) incidental to such transit by road,
rail, inland waterway, lift or elevator.7
Apropos, we now resolve the issue of whether the loss of respondents’ vehicle falls within the concept
of the "theft clause" under the insurance policy.
In People v. Bustinera,8 this Court had the occasion to interpret the "theft clause" of an insurance policy.
In this case, the Court explained that when one takes the motor vehicle of another without the latter’s
consent even if the motor vehicle is later returned, there is theft – there being intent to gain as the use
of the thing unlawfully taken constitutes gain.
Also, in Malayan Insurance Co., Inc. v. Court of Appeals,9 this Court held that the taking of a vehicle by
another person without the permission or authority from the owner thereof is sufficient to place it
within the ambit of the word theft as contemplated in the policy, and is therefore, compensable.
Moreover, the case of Santos v. People10 is worthy of note. Similarly in Santos, the owner of a car
entrusted his vehicle to therein petitioner Lauro Santos who owns a repair shop for carburetor repair
and repainting. However, when the owner tried to retrieve her car, she was not able to do so since
Santos had abandoned his shop. In the said case, the crime that was actually committed was Qualified
Theft. However, the Court held that because of the fact that it was not alleged in the information that
the object of the crime was a car, which is a qualifying circumstance, the Court found that Santos was
only guilty of the crime of Theft and merely considered the qualifying circumstance as an aggravating
circumstance in the imposition of the appropriate penalty. The Court therein clarified the distinction
between the crime of Estafa and Theft, to wit:
x x x The principal distinction between the two crimes is that in theft the thing is taken while in estafa
the accused receives the property and converts it to his own use or benefit. However, there may be
theft even if the accused has possession of the property. If he was entrusted only with the material or
physical (natural) or de facto possession of the thing, his misappropriation of the same constitutes theft,
but if he has the juridical possession of the thing his conversion of the same constitutes embezzlement
or estafa.11
In the instant case, Sales did not have juridical possession over the vehicle. Hence, it is apparent that the
taking of repondents’ vehicle by Sales is without any consent or authority from the former.
Records would show that respondents entrusted possession of their vehicle only to the extent that Sales
will introduce repairs and improvements thereon, and not to permanently deprive them of possession
thereof. Since, Theft can also be committed through misappropriation, the fact that Sales failed to
return the subject vehicle to respondents constitutes Qualified Theft. Hence, since repondents’ car is
undeniably covered by a Comprehensive Motor Vehicle Insurance Policy that allows for recovery in
cases of theft, petitioner is liable under the policy for the loss of respondents’ vehicle under the "theft
clause."
All told, Sales’ act of depriving respondents of their motor vehicle at, or soon after the transfer of
physical possession of the movable property, constitutes theft under the insurance policy, which is
compensable.12
WHEREFORE, the instant petition is DENIED. The Decision dated April 12, 2005 and Resolution dated July
20, 2006 of the Court of Appeals are hereby AFFIRMED in toto.
SO ORDERED.

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G.R. No.

L-25579 March 29, 1972

Tanopo, Millora, Serafica, and Sañez for plaintiff-appellees.

Araneta, Mendoza and Papa for defendant-appellant.

Zaldivar, Castro, Fernando and Villamor, JJ., concur.

Makasiar, J., reserves his vote.

Defendant's accidental death benefit clause expressly provides:

(1) Self-destruction or self-inflicted injuries, whether the Insured be sane or insane;

(2) Bodily or mental infirmity or disease of any kind;

(7) Atomic energy explosion of any nature whatsoever.

The lower court thereafter rendered judgment against defendant, as follows:

The Court so expressly held in Calanoc that:

— Injuries effected through non-external means which are excepted: self-destruction, bodily or mental

Concepcion, C.J. and Reyes, J.B.L., J., concur.

Defendant's accidental death benefit clause expressly provides:

(1) Self-destruction or self-inflicted injuries, whether the Insured be sane or insane;

(2) Bodily or mental infirmity or disease of any kind;

(7) Atomic energy explosion of any nature whatsoever.

The lower court thereafter rendered judgment against defendant, as follows:

The Court so expressly held in Calanoc that:

— Injuries effected through non-external means which are excepted: self-destruction, bodily or mental

SUN INSURANCE OFFICE, LTD., petitioner,

The term "accident" has been defined as follows:

The company shall not be liable in respect of

xxx xxx xxx

Lucio Javillonar for petitioner.

G.R. No. 85296 May 14, 1990

ZENITH INSURANCE CORPORATION, petitioner,

Vicente R. Layawen for petitioner.

Lawrence L. Fernandez & Associates for private respondent.

The antecedent facts are as follows:

WHEREFORE, defendant is hereby ordered to pay to the plaintiff:

2. The amount of P20,000.00 by way of moral damages;

3. The amount of P20,000.00 by way of exemplary damages;

4. The amount of P5,000.00 as attorney's fees;

5. The amount of P3,000.00 as litigation expenses; and

6. Costs. (p. 9, Rollo)

2) P10,000.00 as moral damages;

3) P5,000.00 as attorney's fees;

4) P3,000.00 as litigation expenses; and

ACCORDINGLY, the appealed decision is MODIFIED as above stated.

G.R. No. L-60887 November 13, 1991

PERLA COMPANIA DE SEGUROS, INC., petitioner,

Hector L. Fernandez for petitioner.

Domingo Quibranza and Vicente A. Quibranza for private respondents.

the writ of garnishment.

Rule 39, Section 15 provides:

not exempt from execution . . .

Rule 57, Section 7(e) in turn reads:

order in the following manner:

complete satisfaction of the judgment of the court. In Bautista v. Barredo, 16

Enriquez. Perla cannot successfully evade liability thereon by such a contention.

Inc. vs. Torres, 22

JEWEL VILLACORTA, assisted by her husband, GUERRERO VILLACORTA, petitioner,

TEEHANKEE, Acting C.J.:

G.R. No. 173773 November 28, 2012

PARAMOUNT INSURANCE CORPORATION, Petitioner,

The undisputed facts follow.

On May 26, 1994, respondents insured with petitioner their 1994

After presentation of respondents’ evidence, petitioner filed a Demurrer to Evidence.

SECTION III – LOSS OR DAMAGE

(a) by accidental collision or overturning, or collision or overturning consequent upon mechanical

(b) by fire, external explosion, self-ignition or lightning or burglary, housebreaking or theft;