General Provisions
14;
MEA BUILDERS, INC., VICENTE LLAVE, ERNESTO YU and ANGEL YUANLIAN,
petitioners, vs. COURT OF APPEALS (FORMER FIFTEENTH DIVISION) and
METROPOLITAN BANK AND TRUST COMPANY, respondents. | G.R. No.
121484, THIRD DIVISION, January 31, 2005, CORONA, J.
FACTS:
On July 15, 1982, MEA Builders Inc (MEA) entered into a contract with Capital
Resources Corporation (CRC) for the construction of housing units for CRC’s
residential subdivision in Multinational Village, Parañaque, Metro Manila in
consideration of P39,256,880.00 payable in cash and negotiable securities. Under
the contract the cash portion shall be payable in 9 0-day stand-by letters of credit
from a bank.
On August 11, 1982, MEA, CRC and private respondent Metropolitan Bank and
Trust Company (Metrobank) entered into a tripartite agreement whereby stand-
by letters of credit would be issued to cover the cash portion of the payments on
completed housing units in the MEA and CRC.
In a letter dated August 9, 1982 to Home Financing Corporation (HFC),
Metrobank expressed its willingness to finance the construction of the CRC
Multinational Village project up to the amount of P190 million thru letters of
credit.
Thereafter, MEA wrote Metrobank asking if it could obtain the desired stand-by
letters of credit even without the HFC guarantee. In its reply, Metrobank advised
MEA that the letters of credit could be issued only upon submission of the HFC
guarantee and only for completed houses/townhouses/duplex units.
In order to increase its capital, MEA secured from Metrobank an advance of
P3,000,000.00 which Metrobank approved on the condition that it would
nominally be covered by a promissory note and by a suretyship agreement
executed by petitioners Llave, Yu and Yuanlian.
When MEA completed construction of several housing units entitling it to
P3,330,277.60 from Metrobank, the amount was applied as follows: partial
liquidation in the amount of P1,500,000.00; various other accounts payable by
MEA to or assumed by it in favor of Metrobank in the amount of P1,253,511.
balance received by or credited to the account of MEA in the amount of
P576,716.45.
As a result of the partial liquidation, petitioners executed a new promissory note
in favor of Metrobank for the remaining P1,500,000.00 balance out of the original
P3,000,000.00.
On May 10, 1983, MEA finished 45 single detached units. However, Metrobank
advised MEA to hold off construction work until after CRC would have sold a
substantial number of completed units.
MEA objected to the indefinite suspension and demanded payment for all their
work accomplishments.
When MEA defaulted on the P1.5 million promissory note, Metrobank instituted
a civil case for the recovery of the amount covered by the promissory note.
MEA and other petitioners denied any liability to Metrobank on the ground that
said promissory note and continuing suretyship failed to reflect the true intent
and agreement of the parties. They contended that the real agreement of the
parties was not that of a “straight” or eimple loan payable within the fixed period
of time but an advance payment scheme tied up with the agreements relative to
the execution of construction work in the CRC-Multinational Village project, to be
liquidated from payments expected to become due to MEA.
The trial court decided in favor of MEA and found that the promissory note
covering the P1.5 million was not really a straight or simple loan. Thus, the trial
court ordered the defendants to pay the petitioners the following:
a. P18,200,000.00 representing the actual fair market value of
construction work already performed by MEA including the cost of filing
materials advanced at the CRC Multinational Village minus the amount of
P1.5 million covered by the promissory note
b. The sum of P9,000,000.00 as actual and consequential damages
suffered by MEA.
The CA modified the decision of the trial court since the P18,200,000.00 was
overstated. The CA, thus, directed Metrobank to pay MEA Builders Corporation
P6,308,484.54 representing the value of the townhouses, duplex and single
detached units less P3,274,263.22 representing payment of the 45 duplex and
single detached units and further less the loan of P1.5 Million with 26% interest
per annum and 12% per annum penalty; and with costs against the appellants.
With regard to the P9,000,000 actual and consequential damages, the CA
ruled that it cannot be recovered. The CA stated that the trial court must
have been misled by the testimony of Vicente Llave who made a sweeping
statement that the ₱9 Million represents unrealized profits and 3%
monthly interest. Also, the agreement between MEA Builders and
Metrobank mentioned non-recovery of the capital outlay because of
devaluation and high prices, expected “margin”, and liability for interests
and borrowings. It is not the fact of winning alone that entitles a party to
recover attorney’s fees but rather the attendance of any of the exceptional
circumstances being enumerated in Art. 2208, otherwise, we would be
putting a premium on the right to litigate which should not be so.
ISSUE/S:
W/N the actual and consequential damages can be recovered as well as the
attorney’s fees.
RULING:
NO.
In legal contemplation, the term “damages” is the sum of money which the law
awards or imposes as a pecuniary compensation, a recompense or satisfaction
for an injury done or a wrong sustained as a consequence either of a breach of a
contractual obligation or a tortuous act. Here, aside from the fact that the court
find neither breach of contractual obligation nor bad faith on the part of
Metrobank when it suggested the suspension of construction work for the
protection of the parties’ mutual interests, petitioners failed to establish actual
or compensatory damages with a reasonable degree of certainty. The trial court’s
sole basis for the award of compensatory damages was the testimony of
petitioner Llave who made a sweeping statement that the P9,000,000.00
represented unrealized profits plus 3% monthly interest. This was not sufficient.
The award of actual or compensatory damages could not be sustained without
any document any proof to support such claim.
Regarding the award of attorney’s fees, suffice it to state that the court find no
sufficient justification for such an award. The grant of attorney’s fees is the
exception rather than the rule, hence, it is necessary for the trial court to make
findings of fact and law which bring the case within the exception and justify the
grant of the award.
All told, petitioner failed to establish the presence of any of the exceptions to
justify this Court’s review of the factual findings of the Court of Appeals.
DISPOSITIVE PORTION:
WHEREFORE, the petition is hereby DENIED and the August 30, 1994 decision of
the Court of Appeals in CA-G.R. No. 40146 is affirmed in toto. SO ORDERED.
- SAB
2. HEIRS OF SIMEON BORLADO, namely, ADELAIDA BORLADO, LORETO
BORLADO, REYNALDO BORLADO, RICARDO BORLADO, FRANCISCO
BORLADO and ALADINO DORADO, petitioners, vs. COURT OF APPEALS, and
SALVACION VDA. DE BULAN, BIENVENIDO BULAN, JR., NORMA B. CLARITO
and THE PROVINCIAL SHERIFF OF CAPIZ, Respondents.
G.R. No. 114118 August 28, 2001 Pardo, J.
FACTS:
Plaintiffs-appellants (petitioners) are the heirs of Simeon Borlado whose parents
were Serapio Borlado and Balbina Bulan. The original owner of the lot in
question, Lot No. 2097 of the Pontevedra Cadastre, Maayon, Capiz, was Serapio
Borlado, grandfather of petitioners.
On 15 April 1942, Serapio sold the lot to Francisco Bacero for P300. After the
death of Francsico in 1948, his widow Amparo Dionisio Vda. de Bacero, in her
capacity as legal guardian of her minor children, namely: Nicolas, Valentin and
Luzviminda, all surnamed Bacero and forced heirs of Francisco sold the lot to the
Spouses Bienvenido Bulan and Salvacion Borbon, through a Deed of Absolute Sale
dated 27 August 1954.
Upon the execution of the Deed of Sale and even prior thereto, actual possession
of Lot No. 2057 was with the vendees-spouses Bulans in view of a loan obtained
by Francisco from them. Exercising their right of ownership under the Deed of
Sale, Salvacion declared the lot in her name for taxation purposes. She paid the
corresponding taxes. Salvacion and her co-defendants-appellees possession of
the lot was continuous, peaceful, uninterrupted, adverse and exclusive until The 100 cavans of palay was awarded as a form of damages. We cannot sustain
November 4, 1972, when petitioners forcibly entered and wrested physical the award. Palay is not legal tender currency in the Philippines.
possession thereof from them.
WHEREFORE, the Court DENIES the petition and AFFIRMS the decision of the
On 23 November 1972, respondents filed with the Municipal Court of Maayon, Court of Appeals in CA-G. R. CV No. 18980 with modification that petitioners
Capiz a complaint for ejectment against petitioners which was later on decided liability to pay respondents one hundred (100) cavans of palay every year from
in favor of the respondents whereby the petitioners, their agents, tenants, privies 1972 until petitioners vacate the land in question is deleted, for lack of basis. No
and members of their families were ordered to vacate Lot No. 2079 and deliver costs. SO ORDERED.
possession to the respondents together with all improvements and standing
crops; to pay said respondents 10 cavans of palay annually from 1972 to the - Pao
present or in the total amount of 1,100 cavans of palay; and to pay the sum of
P5,000 as reimbursement for the amount respondents had paid their lawyer to Actual and Compensatory Damages
protect their rights; and, the costs of suit. Instead of appealing the adverse
decision to the CFI (now RTC), petitioners filed the present case with the RTC of
Roxas City. This case was dismissed for lack of cause of action in a decision. The A. Concept
CA affirmed in toto the said decision of the RTC.

ISSUE: LEOPOLDO ARANETA, petitioner, vs. BANK of AMERICA, respondent.

Whether the CA erred in ruling that respondents were the owners of the lot in
question.
FACTS
RULING:
Leopoldo Araneta, the petitioner herein, was a local merchant engaged in the
import and export business. On June 30, 1961 he issued a check for $500
We deny the petition. The issue is factual. In an appeal via certiorari, we may not
payable to cash and drawn against the San Francisco main office of the Bank of
review the findings of fact of the CA. When supported by substantial evidence,
America, where he had been maintaining a dollar current account since 1948. At
the findings of fact of the CA are conclusive and binding on the parties and are
that time he had a credit balance of $523.81 in his account, confirmed by the
not reviewable by this Court, unless the case falls under any of the exceptions to
bank's assistant cashier in a letter to Araneta dated September 7, 1961.
the rule.
However, when the check was received by the bank on September 8, 1961, a
day after the date of the letter, it was dishonored and stamped with the notation
Petitioner failed to prove that the case falls within the exceptions. The SC is not a
"Account Closed."
trier of facts. It is not our function to review, examine and evaluate or weigh the
probative value of the evidence presented. A question of fact would arise in such
Upon inquiry by Araneta as to why his check had been dishonored, the Bank of
event. Questions of fact cannot be raised in an appeal via certiorari before the SC
America acknowledged that it was an error, explaining that for some reason the
and are not proper for its consideration.
check had been encoded with wrong account number, and promising that "we
shall make every effort to see that this does not reoccur." The bank sent a letter
Nevertheless, as a matter of law, the trial court and the CA erred in holding
of apology to the payee of the check, a Mr. Harry Gregory of Hongkong, stating
petitioners liable to pay respondents 100 cavans of palay every year from 1972
that "the check was returned through an error on our part and should not
until they vacate the premises of the land in question.
reflect adversely upon Mr. Araneta." In all probability the matter would have
been considered closed, but another incident of a similar nature occurred later.
On May 25, and 31, 1962 Araneta issued Check No. 110 for $500 and Check No.
111 for $150, respectively, both payable to cash and drawn against the Bank of
America. These two checks were received by the bank on June 3, 1962. The first
check appeared to have come into the hands of Rufina Saldana, who deposited it
to her account the First National City Bank of New York, which in turn cleared it
through the Federal Reserve Bank. The second check appeared to have been
cleared through the Wells Fargo Bank. Despite the sufficiency of Araneta's
deposit balance to cover both checks, they were again stamped with the
notation "Account Closed" and returned to the respective clearing banks.
In the particular case of Check No. 110, it was actually paid by the Bank of
America to the First National City Bank. Subsequently, however, the Bank of
America, claiming that the payment had been inadvertently made, returned the
check to the First National City Bank with the request that the amount thereof
be credited back to the Bank of America. In turn, the First National City Bank
wrote to the depositor of the check, Rufina Saldana, informing her about its
return with the notation "Account Closed" and asking her consent to the
deduction of its amount from her deposit. However, before Mrs. Saldana's reply
could be received, the Bank of America recalled the check from the First
National City Bank and honored it.
In view of the foregoing incidents, Araneta, through counsel, sent a letter to the
Bank of America demanding damages in the sum of $20,000.
The offer was rejected.
ISSUE
Whether or not Araneta should be awarded temperate damages
HELD
YES. The financial credit of a businessman is a prized and valuable asset, it being
a significant part of the foundation of his business. Any adverse reflection
thereon constitutes some material loss to him. As stated in the case Atlanta
National Bank vs. Davis, supra, citing 2 Morse Banks, Sec. 458, "it can hardly be
possible that a customer's check can be wrongfully refused payment without
some impeachment of his credit, which must in fact be an actual injury, though
he cannot, from the nature of the case, furnish independent, distinct proof
thereof."
The Code Commission, in explaining the concept of temperate damages under
Article 2224, makes the following comment:
In some States of the American Union, temperate damages are
allowed. There are cases where from the nature of the case,
definite proof of pecuniary loss cannot be offered, although the
court is convinced that there has been such loss. For instance,
injury to one's commercial credit or to the goodwill of a
business firm is often hard to show with certainty in terms of
money. Should damages be denied for that reason? The judge
should be empowered to calculate moderate damages in such
cases, rather than that the plaintiff should suffer, without
redress from the defendant's wrongful act.
The petitioner, as found by the Court of Appeals, is a merchant of long standing
and good reputation in the Philippines. Some of his record is cited in the
decision appealed from. We are of the opinion that his claim for temperate
damages is legally justified. Considering all the circumstances, including the
rather small size of the petitioner's account with the respondent, the amounts of
the checks which were wrongfully dishonored, and the fact that the respondent
tried to rectify the error soon after it was discovered, although the rectification
came after the damage had been caused, we believe that an award of P5,000 by
way of temperate damages is sufficient.
PREMIERE DEVELOPMENT BANK, petitioner, vs.
COURT OF APPEALS, PANACOR MARKETING CORPORATION and ARIZONA
TRANSPORT CORPORATION, respondents.
G.R. No. 159352 , FIRST DIVISION, April 14 ,2004, YNARES-SANTIAGO, J.
FACTS
Panacor Marketing Corporation (Panacor for brevity), a newly formed
corporation, acquired an exclusive distributorship of products manufactured by
Colgate Palmolive Philippines, Inc. (Colgate for short). To meet the capital
requirements of the exclusive distributorship, which required an initial inventory
level of P7.5 million, Panacor applied for a loan of P4.1 million with Premiere
Development Bank. After an extensive study of Panacor’s creditworthiness,
Premiere Bank rejected the loan application and suggested that its affiliate
company, Arizona Transport Corporation (Arizona for short), should instead
apply for the loan on condition that the proceeds thereof shall be made available
to Panacor. Eventually, Panacor was granted a P4.1 million credit line as
evidenced by a Credit Line Agreement. As suggested, Arizona, which was an
existing loan client, applied for and was granted a loan of P6.1 million, P3.4
million of which would be used to pay-off its existing loan accounts and the
remaining P2.7 million as credit line of Panacor. As security for the P6.1 million
loan, Arizona, represented by its Chief Executive Officer Pedro Panaligan and
spouses Pedro and Marietta Panaligan in their personal capacities, executed a
Real Estate Mortgage against a parcel of land.
Since the P2.7 million released by Premiere Bank fell short of the P4.1 million
credit line which was previously approved, Panacor negotiated for a take-out
loan with Iba Finance Corporation (hereinafter referred to as Iba-Finance) in the
sum of P10 million, P7.5 million of which will be released outright in order to
take-out the loan from Premiere Bank and the balance of P2.5 million (to
complete the needed capital of P4.1 million with Colgate) to be released after the
cancellation by Premiere of the collateral mortgage on the property covered by
TCT No. T-3475. Pursuant to the said take-out agreement, Iba-Finance was
authorized to pay Premiere Bank the prior existing loan obligations of Arizona in
an amount not to exceed P6 million.
Iba-Finance sent a letter to the officer-in-charge of Premiere Bank’s San Juan
Branch, informing her of the approved loan in favor of Panacor and Arizona, and
requesting for the release of TCT No. T-3475. Said officer affixed her signature of
conformity thereto and sent the original copy to Premiere Bank’s legal office.
Premiere Bank sent a letter-reply to Iba-Finance, informing the latter of its
refusal to turn over the requested documents on the ground that Arizona had
existing unpaid loan obligations and that it was the bank’s policy to require full
payment of all outstanding loan obligations prior to the release of mortgage
documents. Thereafter, Premiere Bank issued to Iba-Finance a Final Statement of
Account showing Arizona’s total loan indebtedness. Panacor and Arizona
executed in favor of Iba-Finance a promissory note in the amount of 7.5 million.
Thereafter, Iba-Finance paid to Premiere Bank the amount of P6,235,754.79
representing the full outstanding loan account of Arizona. Despite such payment,
Premiere Bank still refused to release the requested mortgage documents
specifically, the owner’s duplicate copy of TCT No. T-3475
Panacor and Arizona filed a complaint for specific performance and damages
against Premiere Bank before the Regional Trial Court of Pasig City. Iba-Finance
filed a complaint-in-intervention praying that judgment be rendered ordering
Premiere Bank to pay damages in its favor.
The trial court rendered a decision in favor of Panacor and Iba-Finance. Premiere
Bank appealed to the Court of Appeals contending that the trial court erred in
finding, inter alia, that it had maliciously downgraded the credit-line of Panacor
from P4.1 million to P2.7 million. The Court of Appeals affirmed with
modification the decision of the trial court.
ISSUE
Whether or not Premier is entitled to actual damages.
RULING:
NO. To justify an award for actual damages, there must be competent proof of
the actual amount of loss. Credence can be given only to claims, which are duly
supported by receipts.1The burden of proof is on the party who will be defeated
if no evidence is presented on either side. He must establish his case by a
preponderance of evidence which means that the evidence, as a whole, adduced
by one side is superior to that of the other. In other words, damages cannot be
presumed and courts, in making an award, must point out specific facts that can
afford a basis for measuring whatever compensatory or actual damages are
borne.
Under Article 2199 of the Civil Code, actual or compensatory damages are those
awarded in satisfaction of, or in recompense for, loss or injury sustained. They
proceed from a sense of natural justice and are designed to repair the wrong that
has been done, to compensate for the injury inflicted and not to impose a penalty.
In the instant case, the actual damages were proven through the sole testimony Under the circumstances, the sum of P200,000.00 as temperate damages is
of Themistocles Ruguero, the vice president for administration of Panacor. In his reasonable.
testimony, the witness affirmed that Panacor incurred losses, specifically, in
terms of training and seminars, leasehold acquisition, procurement of vehicles -Rochelle
and office equipment without, however, adducing receipts to substantiate the
same. The documentary evidence marked as exhibit "W", which was an ordinary
private writing allegedly itemizing the capital expenditures and losses from the
failed operation of Panacor, was not testified to by any witness to ascertain the
veracity of its contents. Although the lower court fixed the sum of B. Kinds of Actual Damages
P4,520,000.00 as the total expenditures incurred by Panacor, it failed to
show how and in what manner the same were substantiated by the claimant
with reasonable certainty. Hence, the claim for actual damages should be G.Q. GARMENTS, INC., Petitioner, v. ANGEL MIRANDA, FLORENDA MIRANDA
admitted with extreme caution since it is only based on bare assertion without and EXECUTIVE MACHINERIES and EQUIPMENT CORPORATION,
support from independent evidence. Premiere’s failure to prove actual Respondents.F
expenditure consequently conduces to a failure of its claim. In determining
actual damages, the court cannot rely on mere assertions, speculations, [G.R. NO. 161722 : July 20, 2006]
conjectures or guesswork but must depend on competent proof and on the
FACTS:
best evidence obtainable regarding the actual amount of loss.
Angel Miranda is the registered owner of a parcel of land located in Cavite. In
Even if not recoverable as compensatory damages, Panacor may still be awarded
1984, Angelito Miranda, the son of Angel Miranda, established the Executive
damages in the concept of temperate or moderate damages. When the court finds
Machineries and Equipment Corporation (EMECO). Angel entered into a verbal
that some pecuniary loss has been suffered but the amount cannot, from the
contract of lease over the Property with EMECO, and allowed it to build a
nature of the case, be proved with certainty, temperate damages may be
factory thereon. The agreement was on a month-to-month basis, at the rate of
recovered. Temperate damages may be allowed in cases where from the nature
P8,000 per month. EMECO constructed its factory on the property. At the outset,
of the case, definite proof of pecuniary loss cannot be adduced, although the court
EMECO paid the monthly rentals. However, after Angelito died, EMECO failed to
is convinced that the aggrieved party suffered some pecuniary loss.
pay the rentals but still continued possessing the leased premises.
It is obvious that the wrongful acts of Premiere Bank adversely affected, in one
In 1989, EMECO was totally razed by fire. Angel demanded the payment of
way or another, the commercial credit of Panacor, greatly contributed to, if not,
accrued rentals in the amount of P280,000.00. EMECO was also informed that the
decisively caused the premature stoppage of its business operations and the
oral contract of lease would be terminated. However, EMECO failed to pay the
consequent loss of business opportunity. Since these losses are not susceptible to
accrued rentals and to vacate the property. Another demand letter was sent to
pecuniary estimation, temperate damages may be awarded. Article 2216 of the
EMECO. It vacated the leased premises, but the accrued rentals remained unpaid.
Civil Code:
In 1991, Florenda arrived at the office of GQ Garments and offered to sublease
No proof of pecuniary loss is necessary in order that moral, nominal, temperate,
the property to Wilson Kho. Florenda showed Kho a purported copy of a contract
liquidated or exemplary damages may be adjudicated. The assessment of such
of lease. Kho agreed to rent the area upon the condition that its true and
damages, except liquidated ones, is left to the discretion of the Court, according
registered owner would personally sign the lease contract in his presence. When
to the circumstances of each case.
Florenda failed to present Angel for said purpose, Kho turned down her proposal.
Later, Kho was able to locate Angel and offered, in behalf of GQ Garments, to lease
the property, as to which Angel agreed. The construction of a building and factory
in the leased premises commenced. However, in 1992, Florenda, together with
several armed men, forcibly evicted GQ from the leased premises, claiming that
she was the owner and that the place was already covered by another existing
contract of lease. During the encounter, Florenda and her men took some
equipment, machinery and other properties belonging to petitioner, thereby
causing loss and damage to said properties.
Angel secured a copy of the purported contract of lease he allegedly executed in
favor of EMECO. He forthwith filed a complaint for declaration of nullity of the
contract of lease before the RTC of Makati. Angel alleged that his signature as
lessor in the purported contract was a forgery. He prayed that judgment be
rendered in his favor declaring the said contract null and void.
Meanwhile, GQ sought the help of the PNP. General Flores, Deputy Director
General and Chief Directorial Staff, issued a Memorandumt to Superintendent
Soberano, Provincial Director of the Cavite PNP Provincial Command, ordering
the latter to prevent his men from interfering with the pending civil case. GQ
subsequently regained possession over the leased premises. However, Florenda
and her group went back to the place and ousted the guards and other personnel
manning the corporation's office, and even removed their equipment, and
ransacked anew their raw materials, electric wire and other valuables inside.
GQ instituted an action for damages and recovery of possession of the property
before the RTC of Cavite City, with Angel, EMECO and Florenda, as alternative
defendants.
It prayed that, after due proceedings, judgment be rendered in its favor, as
follows:
1. That upon due notice and hearing, a writ of preliminary mandatory
injunction issue, restoring Plaintiff to the possession of the premises in
question;
2. That after trial, judgment issue directing Alternative Defendants,
singly or collectively, and any person or persons claiming right under
them to surrender possession of the leased premises to Plaintiff;
3. That either Defendant, or all of them, be condemned to pay to
Plaintiff the sum of TWO MILLION PESOS (P2,000,000) by way of
actual, compensatory, and moral damages;
4. That either Defendant, or all of them, be condemned to pay attorney's
fees and litigation expenses in the sum earlier set forth; and
5, That either Defendant, or all of them, be condemned to pay the costs
of this suit;
6. OTHER RELIEFS and remedies as are just and equitable under the
premises are likewise prayed for.
Angel and GQ, as plaintiffs, filed a separate complaint for ejectment against
Florenda before MTC. After due proceedings, the court rendered judgment
ordering the eviction of Florenda and all those claiming the property in her
behalf. The decision was appealed to the RTC. However, for failure to pay a
supersedeas bond, the decision was executed and Florenda was evicted from the
property.
The RTC dismissed the complaint filed by GQ for damages and recovery of
possession against all the alternative defendants without prejudice. It declared
that plaintiff was entitled to damages, but it had to dismiss the complaint because
of the pendency of other cases. However, the RTC resolved to deny the motion of
GQ prompting it to appeal to the Court of Appeals.
Meantime, RTC rendered judgment in another case in favor of Angel and declared
the contract of lease purportedly executed by him and EMECO void.
CA reversed the RTC. The fallo reads:
WHEREFORE, the judgment appealed from is hereby REVERSED and
SET ASIDE and a new one entered dismissing the complaint with
prejudice against Angel Miranda and ordering Florenda Miranda to pay
G.Q. Garments, Inc. the amount of:
1. P300,000.00 as and for nominal damages;
2. P200,000.00 as and for attorney's fees; and
3. To pay the costs of suit.
The CA absolved Angel of any liability due to the absence of evidence showing
that he had participated, directly or indirectly, in the looting of GQ Garment's
properties and in forcibly ejecting the latter from the premises in question.
Moreover, the CA declared that the warranty of a lessor extends only to non-
disturbance of legal possession and not of physical possession. According to the
CA, the evidence on record clearly showed that Florenda disturbed only the
physical possession of the leased premises, and not legal possession. Thus, the
complaint with respect to Angel Miranda should be dismissed with prejudice for
lack of cause of action.
ISSUES:
Whether respondents are liable to petitioner for the amount of P10,000,000.00
by way of actual damages;
RULING:
NO.
Petitioner asserts that the P10,000,000.00 in actual damages was
specifically alleged in its complaint and that evidence was adduced to
prove the same, consisting of the testimonies of respondent Florenda
Miranda and her witnesses to determine the extent of petitioner's
damages.
We agree with the ruling of the appellate court that petitioner's claim for actual
damages was not properly substantiated by evidence. The CA correctly ruled as
follows:
Considering the above provisions of the law, there is no question that
defendant-appellee Florenda Miranda and/or EMECO should be held
accountable for the damage sustained by plaintiff-appellant due to their
willful and wanton disregard of the lease rights of plaintiff-appellant
over the property in question. However, we find that the alleged loss of
articles, machinery and equipment in the total sum of P9,960,000.00 was
not proven by clear and convincing evidence. Other than the bare
testimony of Mr. Wilson Kho and the witnesses he presented, there was
no poof as to the existence of these items prior to the taking over of
Florenda over the property in question. The listing of lost items
contained in plaintiff-appellant's Exhibits "I" and "I-1" is self-serving
considering that no inventory was made on the said items prior to its
delivery to the premises in question and that no receipt or proof of
acquisition of these listed items were presented during the trial of the
case.
Under Article 2199 of the New Civil Code, actual damages include all the
natural and probable consequences of the act or omission complained of,
classified as one (1) for the loss of what a person already possesses (daño
emergente) and the other, for the failure to receive, as a benefit, that which
would have pertained to him (lucro cesante).
The burden of proof is on the party who will be defeated if no evidence is
presented on either side. His burden is to establish his case by preponderance of
evidence which means that the evidence, as whole, adduced by one side, is
superior to that of the other. Actual damages are not presumed. The claimant
must prove the actual amount of loss with a reasonable degree of certainty
premised upon competent proof and on the best evidence obtainable. He
must point out specific facts that could afford a basis for measuring
whatever compensatory or actual damages are borne. Actual damages
cannot be anchored on mere surmises, speculations or conjectures.
The claimants are not, however, mandated to prove damages in any specific or
certain amount in order to recover damages for a substantial amount. When the
existence of a loss is established, absolute certainty as to its amount is not
required. The amount of the damages should be determined with reasonable
certainty. The law does not require that the amount fixed be absolute or beyond
conjectural possibilities. The ascertainment of the amount of damages should be
by the plainest, easiest and most accurate measure which will do justice in the
premises.
The Court further declared that "where goods are destroyed by the wrongful acts
of the defendant, the plaintiff is entitled to their value at the time of the
destruction, that is normally, the sum of money which he would have to pay in
the market for identical or essentially similar good plus, in a proper case,
damages for the loss of the use during the period before replacement.2
To be entitled to an award of actual damages, it is necessary to prove the
precise amount of the loss with a reasonable degree of certainty, premised
upon competent proof and on the best evidence obtainable by the injured
party to justify such award. The award of actual damages cannot be simply
based on the mere allegation of a witness without any tangible claim, such
as receipts or other documentary proofs to support such claim. Failing to
satisfy the court that petitioner certainly suffered actual damages, its claim
must now fail.
In this case, there is no question that, indeed, GQ Garments sustained damages
because its equipment, machineries, and other valuables were taken, and its
building was destroyed by respondent Florenda Miranda and her cohorts.
Respondent Angel Miranda did not cause the damages sustained by petitioner's
property. However, the only evidence adduced by the petitioner to prove the
value of said property is the testimony of Kho.
- alit
C. Nature and Proof of Compensatory Damages
FRANCISCO A. PERFECTO, petitioner-appellant, vs. HON. FELICIANO S.
GONZALES, Judge of the Court of First Instance of Catanduanes, and
JULIANA C. VISTA and VICENTE VISTA, respondents-appellees.
G.R. No. L-35157 April 17, 1984 RELOVA, J.
FACTS:
Private respondent Juliana C. Vista, a public school teacher of San Andres,
Catanduanes was appointed POU clerk by the Commission on Elections in
Precinct No. 25 of San Andres in the general elections of November 9, 1965.
Petitioner Francisco A. Perfecto, a retired public service commissioner, was a
candidate for congressman of the lone district of Catanduanes. He lost in that
election. In August 1967, petitioner filed with the Commission on Elections an
administrative complaint against the members of the board of election inspectors
of Precinct No. 25 of San Andres including herein private respondent Juliana C.
Vista, poll clerk of said precinct. The complaint charged that the said members of
the board of election inspectors were guilty of nonfeasance, malfeasance and
misfeasance for wilfull failure to comply with the instructions, orders, decisions
and rulings of the Commission in connection with the performance of their duties
relative to the conduct of the elections of 1965.
As a consequence, private respondent Juliana Vista, assisted by her husband
Vicente Vista, filed an action for damages alleging that the above charges were
false and without basis and had been instituted maliciously in order to harass,
annoy demean degrade and expose her to public ridicule and because of which
she suffered "mental torture, anguish, sleepless nights, besmirched reputation,
wounded feelings, mental shock and social humiliation which may be assessed as
moral damages in the amount of P20,000.00." Further, she "claims the further
sum of P15,000.00 as exemplary damages, and P10,000.00 for attorney's fees and
expenses in the prosecution of the suit.
Answering the complaint for damages, herein petitioner Francisco A. Perfecto
avers that the filing of the administrative complaint against private respondent
Vista and the members of the board of election inspectors of Precinct No. 25 was
done in good faith with the highest motive of bringing to justice persons who have
violated the laws of the land.
Evidence shows that private respondent Vista was the poll clerk of Precinct No.
25 of San Andres during the elections of 1965. However, it had been shown
successfully that she did not act as poll clerk on election day, November 9, 1965
because she was ill and had been running with fever for several days prior to the
election. In fact, she was substituted by Nazaria B. Reyes, another public school
teacher as poll clerk on that day.
The lower court found that in the minutes of voting and the election return, it
appears that Mrs. Nazaria B. Reyes, the substitute poll clerk, acted as poll clerk on
election day in place of the regular POU clerk, the plaintiff, who was absent and
did not report for duty. However, the lower court "failed to find sufficient proof
to sustain the charge that in filing the administrative complaint with the
Commission on Elections the defendant was acting with malice and for the sole
purpose of degrading or besmirching the reputation of the plaintiff and exposing
her to public ridicule. Notwithstanding, the lower court rendered judgment
ordering herein petitioner to indemnify private respondent the sum of
P12,000.00 as compensatory damages.
ISSUE:
Whether or not the private respondent is entitled to the P12,000
compensatory damages awarded by the lower court?
RULING:
NO.
Actual or compensatory damages are those recoverable because of
pecuniary loss — in business, trade, property, profession, job, or occupation, and
the same must be proved; otherwise, if the proof is flimsy and non-substantial,
no damages win be given.
In the case of Malonzo vs. Galang,, the Court, speaking through Justice J. B. L.
Reyes, held that with respect to compensatory damages assuming that they are
recoverable under the theory that petitioner had filed a clearly unfounded suit
against respondent, the same constitutes a tort against the latter that makes the
former liable for all damages which are the natural and probable consequences
of the act or omissions complained of. These damages, cannot, however, be
Presumed and must be duly proved (Article 2199, New Civil Code). Well settled
is the rule that even if the complaint filed by one against the other is clearly
unfounded this does not necessarily mean, in the absence of specific facts proving
damages, that defendant really suffered actual damage over and above attorney
fees and costs' The Court cannot rely on its suggestions as to the fact and amount
of damages. It must depend on actual proof of the damages alleged to have been
suffered.
WHEREFORE, the petition is GRANTED and the order of respondent judge
condemning petitioner Francisco A. Perfecto to pay compensatory damages of
P2,000.00 is hereby SET ASIDE.
D. Requisites: Must be alleged and proven with certainty
G.A. Machineries vs. Yaptinchay
G.A MACHINERIES, INC., Petitioner, v. HORACIO YAPTINCHAY, doing
business under the name and style "HI-WAY EXPRESS" and THE COURT OF
APPEALS, Respondents.
[G.R. No. L-30965. November 29, 1983. GUTIERREZ, JR. J]
FACTS:
Sometime early in January, 1962 G. A. Machineries, Inc. (GAMI,) thru a duly
authorized agent, offered to sell a brand-new Fordson Diesel Engine to Horacio
Yaptinchay, owner of the freight hauling business styled ‘Hi-Way Express’.
Relying on the representations of GAMI’s representative that the engine offered
for sale was brandnew, Yaptinchay agreed to purchase the same at the price of
P7,590.00.
Within the week after its delivery, however, the engine in question started to
have a series of malfunctions which necessitated successive trips to GAMI’s
repair shop. Thereafter, the malfunctioning persisted and, on inspection,
Yaptinchay’s mechanic noticed a worn out screw which made appellee suspicious
about the age of the engine. This prompted Yaptinchay, thru his lawyer, to write
GAMI a letter, dated February 10, 1962, protesting that the engine was not brand-
new as represented
These repeatedly recurring defects and continued failure of GAMI to put the
engine in good operating condition only served to firm up in Yaptinchay’s mind
the suspicion that the engine sold to him was not brand-new as represented. He
then sought the assistance of the PC Criminal Investigation Service to check on
the authenticity of the serial number of the engine, with due notice to GAMI.
Scientific examination and verification tests revealed that the original motor
number of the engine aforesaid was tampered. Further inquiries by Yaptinchay
from the Manila Trading Company, which also handles the importation and
distribution of similar engines, also disclosed that, unlike the engine delivered to
Yaptinchay whose engine body and injection pump were painted with two
different colors, brand-new engines are painted with only one color all over.
Thus convinced that a fraudulent misrepresentation as to the character of the
engine had been perpetrated upon him, Yaptinchay made demands from
appellant for indemnification for damages and eventually instituted the present
suit.
In its defense, GAMI interposed prescription of the action, denied the imputation
of misrepresentation, and disputed the propriety and amount of damages
claimed
After trial on the merits, the trial court ruled in favor of plaintiff Yaptinchay as
follows:
FOR ALL THE FOREGOING CONSIDERATIONS, the Court hereby renders
judgment ordering the defendant, G. A. Machineries, Inc., to pay the
plaintiff, Horacio Yaptinchay, actual damages sustained in the sum of
P54,000.48; to reimburse the purchase price of the Fordson diesel
engine in the amount of P7,590.00; and to pay attorney’s fees to
plaintiff’s counsel on the sum of P2,000.00 and costs.
Plaintiff is, likewise, ordered to return the Fordson diesel engine with serial
number A-21219 to the defendant."
Defendant GAMI appealed the decision to the Court of Appeals. As stated earlier,
the decision was affirmed by the Appellate Court. A motion for reconsideration
was denied. Hence, the instant petition.
ISSUE: Whether or not the award of damages was justified considering the
evidence on record.
RULING:
NO. The award of actual damages was not justified
The fact that the defendant does not dispute the amount of this kind of damages
does not necessarily imply that the other party outright is entitled to the award
of damages.
Article 2200 of the Civil Code entitles the respondent to recover as compensatory
damages not only the value of the loss suffered but also prospective profits while
Article 2201 entitles the respondent to recover all damages which may be
attributed to the non-performance of the obligation. However, in order to recover
this kind of damages, the plaintiff must prove his case —
"‘When the existence of a loss is established, absolute certainty as to its
amount is not required. The benefit to be derived from a contract which
one of the parties has absolutely failed to perform is of necessity to some
extent, a matter of speculation, but the injured party is not to be denied
all remedy for that reason alone. He must produce the best evidence
of which his case is susceptible and if that evidence warrants the
inference that he has been damaged by the loss of profits which he
might with reasonable certainty have anticipated but for the
defendant’s wrongful act, he is entitled to recover."
Applying the foregoing test to the instant case, we find the evidence of the
respondent insufficient to be considered within the purview of "best evidence."
The bare assertion of the respondent that he lost about P54,000.00 and the
accompanying documentary evidence presented to prove the amount lost
are inadequate if not speculative. The document itself merely shows that
everytime a truck travels, Mr. Yaptinchay earns P369.88. This amount is then
multiplied by the number of trips which the truck was allegedly unable to make.
The estimates were prepared by a certain Dionisio M. Macasieb whose identity
was not even revealed by the Respondent. Mr. Yaptinchay was in the freight truck
business. He had several freight trucks among them the truck with the subject
Fordson diesel engine, covering the route from Manila to Baguio. To prove actual
damages, it would have been easy to present the average actual profits realized
by the other freight trucks plying the Manila-Baguio route. With the presentation
of such actual income the court could have arrived with reasonable certainty at
the amount of actual damages suffered by the Respondent. We rule that the
award of actual damages in the amount of P54,000.08 is not warranted by the
evidence on record.
Dispositive Portion:
WHEREFORE, the decision appealed from is hereby modified. The award of
actual damages in the amount of P54,000.48 is deleted. The petitioner shall
also pay six (6%) percent interest per annum on the P7,590.00 purchase price
from January 27, 1962 to July 29, 1974 and twelve (12%) percent interest per
annum from July 30, 1974 until the purchase price is reimbursed. In all other
respects, the appealed decision is affirmed. SO ORDERED.
SOLEDAD CARPIO v. LEONORA A. VALMONTE
G.R. NO. 151866, September 9, 2004, TINGA, J.:
FACTS:
Respondent Leonora Valmonte is a wedding coordinator. Michelle del Rosario
and Jon Sierra engaged her services for their church wedding on 10 October
1996. At about 4:30 p.m. on that day, Valmonte went to the Manila Hotel where
the bride and her family were billeted. When she arrived at Suite 326-A, several
persons were already there including the bride, the bride's parents and relatives,
the make-up artist and his assistant, the official photographers, and the fashion
designer. Among those present was petitioner Soledad Carpio, an aunt of the
bride who was preparing to dress up for the occasion.
After reporting to the bride, Valmonte went out of the suite carrying the items
needed for the wedding rites and the gifts from the principal sponsors. She
proceeded to the Maynila Restaurant where the reception was to be held. She
paid the suppliers, gave the meal allowance to the band, and went back to the
suite. Upon entering the suite, Valmonte noticed the people staring at her. It was
at this juncture that petitioner allegedly uttered the following words to Valmonte:
"Ikaw lang ang lumabas ng kwarto, nasaan ang dala mong bag? Saan ka pumunta?
Ikaw lang and lumabas ng kwarto, ikaw ang kumuha." Petitioner then ordered one
of the ladies to search Valmonte's bag. It turned out that after Valmonte left the
room to attend to her duties, petitioner discovered that the pieces of jewelry
which she placed inside the comfort room in a paper bag were lost. The jewelry
pieces consist of two (2) diamond rings, one (1) set of diamond earrings, bracelet
and necklace with a total value of about one million pesos.
The hotel security was called in to help in the search. The bags and personal
belongings of all the people inside the room were searched. Valmonte was
allegedly bodily searched, interrogated and trailed by a security guard
throughout the evening. A few days after the incident, petitioner received a letter
from Valmonte demanding a formal letter of apology which she wanted to be
circulated to the newlyweds' relatives and guests to redeem her smeared
reputation as a result of petitioner's imputations
against her. Petitioner did not respond to the letter. Valmonte filed a suit for
damages against her. In her complaint, Valmonte prayed that petitioner be
ordered to pay actual, moral and exemplary damages, as well as attorney's fees.
The trial court rendered its Decision on 21 August 2000, dismissing Valmonte's
complaint for damages. It ruled that when petitioner sought investigation for the
loss of her jewelry, she was merely exercising her right and if damage results
from a person exercising his legal right, it is damnum absque injuria.
The Court of Appeals ruled differently. It opined that Valmonte has clearly
established that she was singled out by petitioner as the one responsible for the
loss of her jewelry. It cited the testimony of Serena Manding, corroborating
Valmonte's claim that petitioner confronted her and uttered words to the effect
that she was the only one who went out of the room and that she was the one who
took the jewelry. The appellate court held that Valmonte's claim for damages is
not predicated on the fact that she was
subjected to body search and interrogation by the police but rather petitioner's
act of
publicly accusing her of taking the missing jewelry. It categorized petitioner's
utterance
defamatory considering that it imputed upon Valmonte the crime of theft.
ISSUE:
Whether or not Valmonte could recover damages from petitioner (YES)
RULING:
Contrary to the trial court's finding, we find sufficient evidence on record tending
to prove that petitioner's imputations against respondent was made with malice
and in bad faith.
Respondent has successfully refuted petitioner's testimony. Quite credibly, she
has narrated in great detail her distressing experience on that fateful day. She
testified as to how rudely she was treated by petitioner right after she returned
to the room. Petitioner immediately confronted her and uttered the words "Ikaw
lang ang lumabas ng kwarto. Nasaan ang dala mong bag? Saan ka pumunta? Ikaw
ang kumuha." Thereafter, her body was searched including her bag and her car.
Worse, during the reception, she was once more asked by the hotel security to go
to the ladies room and she was again bodily searched.
To warrant recovery of damages, there must be both a right of action, for a wrong
inflicted by the defendant, and the damage resulting therefrom to the plaintiff.
Wrong without damage, or damage without wrong, does not constitute a cause of
action.
In the sphere of our law on human relations, the victim of a wrongful act or
omission, whether done willfully or negligently, is not left without any remedy or
recourse to obtain relief for the damage or injury he sustained. Incorporated into
our civil law are not only principles of equity but also universal moral precepts
which are designed to indicate certain norms that spring from the fountain of
good conscience and which are meant to serve as guides for human conduct. First
of these fundamental precepts is
the principle commonly known as "abuse of rights" under Article 19 of the Civil
Code. It provides that "Every person must, in the exercise of his rights and in the
performance of his duties, act with justice, give everyone his due and observe
honesty and good faith." To find the existence of an abuse of right, the following
elements must be present: (1) there is a legal right or duty; (2) which is exercised
in bad faith; (3) for the sole intent or prejudicing or injuring another. When a right
is exercised in a manner which discards these norms resulting in damage to
another, a legal wrong is committed for which the actor can be held accountable.
One is not allowed to exercisehis right in a manner which would cause
unnecessary prejudice to another or if he would thereby offend morals or good
customs. Thus, a person should be protected only when he acts in the legitimate
exercise of his right, that is when he acts with prudence
and good faith; but not when he acts with negligence or abuse.
In the case at bar, petitioner's verbal reproach against respondent was certainly
uncalled for considering that by her own account nobody knew that she brought
such kind and amount of jewelry inside the paper bag. This being the case, she
had no right to attack respondent with her innuendos which were not merely
inquisitive but outrightly accusatory. By openly accusing respondent as the only
person who went out of the room before the loss of the jewelry in the presence
of all the guests therein, and ordering that she be immediately bodily searched,
petitioner virtually branded respondent as the thief. True, petitioner had the
right to ascertain the identity of the malefactor, but to malign respondent without
an iota of proof that she was the one who actually stole the jewelry is an act which,
by any standard or principle of law is impermissible. Petitioner had willfully
caused injury to respondent in a manner which is contrary to morals and good
customs. Her firmness and resolve to find her missing jewelry cannot justify her
acts toward respondent. She did not act with justice and good faith for
apparently, she had no other purpose in mind but to prejudice respondent.
Certainly, petitioner transgressed the provisions of Article 19 in relation to
Article 21 for which she should be held accountable.
We sustain the findings of the trial court and the appellate court that
respondent's claim for actual damages has not been substantiated with
satisfactory evidence during the trial and must therefore be denied. To be
recoverable, actual damages must be duly proved with reasonable degree of
certainty and the courts cannot rely on speculation, conjecture or guesswork.
Respondent, however, is clearly entitled to an award of moral damages. Moral
damages may be awarded whenever the defendant's wrongful act or omission is
the proximate cause of the plaintiff's physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded feelings, moral shock, social
humiliation, and similar injury in the cases specified or analogous to those
provided in Article 2219 of the Civil Code.
Based on the foregoing jurisprudential pronouncements, we rule that the
appellate court did not err in awarding moral damages. Considering respondent's
social standing, and the fact that her profession is based primarily on trust
reposed in her by her clients, the seriousness of the imputations made by
petitioner has greatly tarnished her reputation and will in one way or the other,
affect her future dealings with her clients, the award of P100,000.00 as moral
damages appears to be a fair and reasonable assessment of respondent's
damages.
-Mika Ituriaga
E. Component Elements
1. Value Of Loss; Unrealized Profit (Lucrum Cessans)
No. L-18487. August 31, 1964.
GENERAL ENTERPRISES, INC., plaintiff-appellee, vs. LIANGA BAY LOGGING
COMPANY, INC., defendant-appellant
FACTS
Lianga Bay Logging Company, Inc., and General Enterprises, Inc, entered into a
contract, herein marked as Annex A, whereby the former, a producer of logs from
a timber concession at Lianga, Surigao, designated the latter as distributor of a
portion of its log production to Korea and Europe on condition that it would pay
the distributor a commission of 13% of the gross f .o.b. value of the logs exported.
In the agreement, the Lianga Bay Logging Company, Inc. was named as Producer
and the General Enterprises, Inc. as Distributor.
Thereupon, the parties immediately began implementing the provisions of the
contract by having the Distributor deliver to the Producer the tractor it agreed to
deliver and by having the Producer deliver logs to the Distributor for export as
agreed upon. On October 27, 1959, the Producer sent a notice to the Distributor
stating that after the November shipment there will be no longer logs available
for export to Korea and Europe "unless the price of such logs become comparable
to what we may expect to receive in the way of returns from lumber and veneer
of barterable and export grades. "
The Producer thereafter stopped supplying logs for export, whereupon the
Distributor reminded the Producer that it had a contract to fulfill but the
Producer did not heed this reminder adducing reasons which in its opinion justify
the action it had taken, thereby causing the Distributor to initiate the present
action before the Court of First Instance of Rizal alleging breach of contract and
praying for damages both actual and compensatory.
The court a quo rendered decision in favor of the plaintiff and against the
defendant ordering the latter to pay the sum of P400,000,00 as actual damages,
the sum of P100,000.00 as exemplary damages, and the sum of P40,000.00 as
attorney's fees and expenses of litigation. This is an appeal from said decision.
ISSUE: Is the lower court's adjudication of actual and exemplary damages and
attorney's fees justified?
RULING:
Yes but with a modification.
Regarding the actual damages awarded to appellee, appellant contends that they
are unwarranted inasmuch as appellee has failed to adduce any evidence to
substantiate them even assuming arguendo that appellant has failed to supply
the additional monthly 2,000,000 board feet for the remainder of the period
agreed upon in the contract Exhibit A. Appellant maintains that for appellee to be
entitled to demand payment of sales that for appellee to be entitled to demand
payment of sales that were not effected it should have proved (1) that there are
actual sales made of appellee's logs which were not fulfilled, (2) that it had
obtained the best price for such sales, (3) that there are buyers ready to buy at
such price stating the volume they-are ready to buy, and (4) appellee could not
cover the sales from the logs of other suppliers. Since these facts were not proven,
appellee's right to unearned commissions must fail. This argument must be
overruled in the light of the law and evidence on the latter. Under Article 2200
of the Civil Code, indemnification for damages comprehends not only the
value of the loss suffered but also that of the profits which the creditor fails
to obtain. In other words, lucrum cessans is also a basis for indemnification.
The question then that arises is: Has appellee failed to make profits because of
appellant's breach of contract, and in the affirmative, is there here basis for
determining with reasonable certainty such unearned profits?
Based on evidence adduced, it appears, that during the period of June to
December, 1959, in spite of the short delivery incurred by appellant, appellee had
been earning its commission whenever logs were delivered to it. But from
January, 1960, appellee has ceased to earn any commission because appellant
failed to deliver any log in violation of their agreement. Had appellant continued
to deliver the logs as it was bound to pursuant to the agreement it is reasonable
to expect that it would have continued earning its commission in much the same
manner as it used to in connection with the previous shipments of logs, which
clearly indicates that it failed to earn the commissions it should earn during this
period of time. And this commission is not difficult to estimate. Thus, during the
seventeen remaining months of the contract, at the rate of at least 2,000,000
board feet, appellant should have delivered thirty-four million board feet. If we
take the number of board feet delivered during the months prior to the
interruption, namely, 7,405,861 board feet, and the commission received by
appellee thereon, which amounts to P79,580.82, we would have that appellee
received a commission of P.0107456 per board feet. Multiplying 34 million
board feet by P. 0107456, the product is P365,350.40, which represents the
lucrum cessans that should accrue to appellee. The award therefore, made
by the court a quo of the amount of P400,000.00 as compensatory damages
is not speculative, but based on reasonable estimate.
We believe, however, that the amount of P100,000.00 awarded to appellee as
exemplary damages is somewhat excessive it appearing that appellant is
suspending the operation of the contract has not acted in a wanton, oppressive
or malevolent manner to deserve such a heavy punishment within the purview
of the law (Article 2232, new Civil Code).
We also find reasonable the amount awarded by the court a quo as attorney's fees
considering the importance of this litigation and the amount of time and effort
therein involved. This is justified under Article 2208 of the Civil Code.
WHEREFORE, the decision appealed from is hereby modified by awarding to
appellee only the amount of P50,000.00 as exemplary damages. In all other
respects, the decision is affirmed, with costs.
2. Factors To Consider In Determining Attorney’s Fees As Liquidated
Damages
PETRON CORPORATION, Petitioner, vs. NATIONAL COLLEGE OF BUSINESS
AND ARTS, Respondent.
G.R. No. 155683 February 16, 2007 J. Corona
FACTS: Sometime in 1969, the V. Mapa properties, then owned by Felipe and
Enrique Monserrat, Jr., were mortgaged to the Development Bank of the
Philippines (DBP) as part of the security for the ₱5.2 million loan of Manila Yellow
Taxicab Co., Inc. (MYTC) and Monserrat Enterprises Co. MYTC, for its part,
mortgaged 4 parcels of land located in Quiapo, Manila.
In 1975, however, Felipe’s ½ undivided interest in the V. Mapa properties was
levied upon in execution of a money judgment rendered by the RTC of Manila in
Filoil Marketing Corporation v. MYTC, Felipe Monserrat, and Rosario Vda. De
Monserrat (the Manila case).
In 1981, MYTC and the Monserrats got DBP to accept a dacion en pago
arrangement whereby MYTC conveyed to the bank the 4 mortgaged Quiapo
properties as full settlement of their loan obligation. But despite this agreement,
DBP did not release the V. Mapa properties from the mortgage.
In 1982, Felipe, acting for himself and as Enrique’s attorney-in-fact, sold the V.
Mapa properties to respondent NCBA. Part of the agreement was that Felipe and
Enrique would secure the release of the titles to the properties free of all liens
and encumbrances including DBP’s mortgage lien and Filoil’s levy on or before
July 31, 1982. But the Monserrats failed to comply with this undertaking. Thus,
on February 3, 1983, NCBA caused the annotation of an affidavit of adverse claim
on the TCTs covering the V. Mapa properties. Shortly thereafter, NCBA filed a
complaint against Felipe and Enrique for specific performance with an
alternative prayer for rescission and damages in the RTC of Manila. NCBA had a
notice of lis pendens inscribed on the TCTs of the V. Mapa properties. A little over
two years later, NCBA impleaded DBP as an additional defendant in order to
compel it to release the V. Mapa properties from mortgage.
In 1985, during the pendency of the case, Enrique’s ½ undivided interest in the
V. Mapa properties was levied on in execution of a judgment of the RTC of Makati
holding him liable to Petron (then known as Petrophil Corporation) on a 1972
promissory note. The V. Mapa properties were sold at public auction to satisfy
the judgments in the Manila and Makati cases. Petron, the highest bidder,
acquired both Felipe’s and Enrique’s undivided interests in the property. The
final deeds of sale of Enrique’s and Felipe’s shares in the V. Mapa properties were
awarded to Petron in 1986. Towards the end of 1987, Petron intervened in
NCBA’s suit against Felipe, Enrique and DBP to assert its right to the V. Mapa
properties.
The RTC ruled in favor of NCBA. It also held Petron, jointly and severally liable
with DBP, Felipe and Enrique for exemplary damages and attorney’s fees on the
ground that
1. Petron had absolutely no reason to claim the V. Mapa property for
the levy in execution and sale of the shares of FELIPE and ENRIQUE
in the V. Mapa property were null and void.
2. in their Memorandum of Agreement with Technical Institute of the
Philippines, Petron and DBP attempted to pre-empt the RTC’s power
to adjudicate on the claim of ownership stipulating that "to facilitate
their defenses and cause of action in Civil Case No. 83-16617," they
agreed on the disposition of the V. Mapa property among
themselves.
Enrique, DBP and Petron appealed to the Court of Appeals but the CA affirmed
the RTC decision in toto.
ISSUE:
W/N petitioner Petron Corporation should be held liable to pay
attorney’s fees and exemplary damages to respondent National College
of Business and Arts (NCBA).
RULING: NO
Article 2208 lays down the rule that in the absence of stipulation, attorney’s fees
cannot be recovered except in the following instances:
(1) When exemplary damages are awarded;
(2) When the defendant’s act or omission has compelled the plaintiff
to litigate with third persons or to incur expense to protect his
interest;
(3) In criminal cases of malicious prosecution against the plaintiff;
(4) In case of a clearly unfounded civil action or proceeding against the
plaintiff;
(5) Where the defendant acted in gross and evident bad faith in
refusing to satisfy the plaintiff’s plainly valid, just and demandable
claim;
(6) In actions for legal support;
(7) In actions for the recovery of wages of household helpers, laborers
and skilled workers;
(8) In actions for indemnity under workmen’s compensation and
employer’s liability laws;
(9) In a separate civil action to recover civil liability arising from a
crime;
(10) When at least double judicial costs are awarded;
(11) In any other case where the court deems it just and equitable
that attorney’s fees and expenses of litigation should be recovered.
Here, the RTC held Petron liable to NCBA for attorney’s fees under Article
2208(5), which allows such an award "where the defendant acted in gross and
evident bad faith in refusing to satisfy the plaintiff’s plainly valid, just, and
demandable claim." However, the only justification given for this verdict was that
Petron had no reason to claim the V. Mapa properties because, in the RTC’s
opinion, the levy and sale thereof were void. This was sorely inadequate and it
was erroneous for the CA to have upheld that ruling built on such a flimsy
foundation.
Article 2208(5) contemplates a situation where one refuses unjustifiably
and in evident bad faith to satisfy another’s plainly valid, just and
demandable claim, compelling the latter needlessly to seek redress from
the courts. In such a case, the law allows recovery of money the plaintiff had to
spend for a lawyer’s assistance in suing the defendant – expenses the plaintiff
would not have incurred if not for the defendant’s refusal to comply with the most
basic rules of fair dealing. It does not mean, however, that the losing party should
be made to pay attorney’s fees merely because the court finds his legal position
to be erroneous and upholds that of the other party, for that would be an
intolerable transgression of the policy that no one should be penalized for
exercising the right to have contending claims settled by a court of law. In fact,
even a clearly untenable defense does not justify an award of attorney’s fees
unless it amounts to gross and evident bad faith.
Petron’s claim to the V. Mapa properties, founded as it was on final deeds of sale
on execution, was far from untenable. No gross and evident bad faith could be
imputed to Petron merely for intervening in NCBA’s suit against DBP and the
Monserrats in order to assert what it believed (and had good reason to believe)
were its rights and to have the disputed ownership of the V. Mapa properties
settled decisively in a single lawsuit.
With respect to the award of exemplary damages, the rule in this jurisdiction is
that the plaintiff must show that he is entitled to moral, temperate or
compensatory damages before the court may even consider the question of
whether exemplary damages should be awarded. In other words, no exemplary
damages may be awarded without the plaintiff’s right to moral, temperate,
liquidated or compensatory damages having first been established.
Therefore, in view of our ruling that Petron cannot be made liable to NCBA for
compensatory damages (i.e., attorney’s fees), Petron cannot be held liable for
exemplary damages either.
DISPOSITIVE PORTION:
WHEREFORE, the petition is hereby GRANTED. The imposition of liability on
Petron Corporation for exemplary damages and attorney’s fees is REVOKED. The
June 21, 2002 decision and October 16, 2002 resolution of the Court of Appeals
in CA–G.R. CV No. 53466 and the March 11, 1996 decision of the Regional Trial
Court of Manila in Civil Case No. 83-16617 are hereby MODIFIED accordingly.
TAN TI (alias Tan Tico), Plaintiff-Appellee, v. JAUN ALVEAR, as sheriff, ET
AL., Defendants-Appellants.
FACTS
Tan Ti, Tiu Uco, and Tiu Tiao Et. Al., the respective plaintiffs, each owned a retail
store in Dagupan. The Court of First Instance of Manila issued execution on the
effects of one Lim Kok Tiu, and ordered notices of garnishment to be served on
each of the above named present plaintiffs. These notices were forwarded to the
sheriff of Pangasinan. It appears that the sheriff himself was not in his office when
the notices were receivedand they were attended to by his deputy, Lopez. Lopez
delivered the notices to another deputy sheriff, Zulueta, for service. Zulueta,
instead of merely serving the notices, informed each of the present plaintiffs that
unless they submitted their respective bonds in the sum of P15,000, he would
close their stores. The respective owners asked for time to go to Manila to secure
bondsmen, which was granted them. On arriving at manila they consulted their
lawyers, who informed them that the sheriff had no right to close their stores
upon garnishment process, and told them to return to Dagupan and so inform the
sheriff and his deputies, with the further admonition that such action would
render the latter liable for damages. The three plaintiffs returned to Dagupan and
notified deputies Lopez and Zulueta accordingly, but the latter went ahead and
closed the stores on November 13, 1911, placing guards at each one.
The owners of the stores thereupon filed the complaints in the present civil
actions on November 17, 1911, after notification to the deputy sheriff that such
was their intention. On November 21, 1911, the attachments were raised and the
plaintiffs were allowed to resume business.
ISSUE
Whether or not Attorney’s fees should be computed to determine the amount of
damages
HELD
No. After an examination of all the available authorities we have concluded that
sound public policy demands that counsel fees in suits of the character of the one
under consideration should not be regarded as a proper element of damages,
even where they are capable of being apportioned so as to show the amount
incurred for the release of the goods as separate and distinct from the other
services necessary in the prosecution of the suit for damages. it is not sound
public policy to place a penalty on the right to litigate. To compel the defeated
party to pay the fees of counsel for his successful opponent would throw wide the
door of temptation to the opposing party an his counsel to swell the fees to undue
proportions, and to apportion them arbitrary between those pertaining property
to one branch of the case from the other.
in this case, if any, were so infinitesimal and speculative, that they cannot be
allowed.
Our decision in the Tan Ti case disposes of the questions raised in the other two
cases. All the items allowed in those cases being of a similar character and having
been computed in the same manner as those in the first case, should be allowed,
with the exception of the amounts allowed as attorneys’ fees and for impairment
of credit. In both cases these items are disallowed.

This court has already placed itself on record as favoring the view taken by those
courts which hold that attorneys’ fees are not a proper element of damages. In
Ortiga Bros. & Co. v. Enage and Yap Tico (18 Phil. Rep., 345), a wrongful
attachment on the pier belonging to plaintiffs had issued at the request of Yap
Tico. Ortiga Bros. sued out an injunction preventing the attempted sale of the pier
POLYTRADE CORPORATION, plaintiff-appellee, vs. VICTORIANO BLANCO,
by the sheriff and the matter was then held in statu quo pending judgment of the
defendant-appellant.
court as to the right of the sheriff to attach and sell the property. Judgment in the
lower court was in favor of the plaintiffs and damages were awarded in the
amount of P600 which proved to consist entirely of the fees of plaintiff’s attorney. G.R. No. L-27033, EN BANC, October 31, 1969, SANCHEZ, J.
This court expressly disallowed the same, awarding the plaintiffs only the usual
statutory costs. FACTS:

As the item of P500 for impairment of plaintiff’s credit: Plaintiff testified that he
was conducting a credit business with wholesale houses in Manila, and that when
his stock of goods was seized by the sheriff he so informed these houses, who
thereupon stopped his credit; that on being restored to possession of his goods
he so advised them. Although he states that by stoppage of his credit he was
unable to secure merchandise for Christmas sales, it appears from his books, as
stated above, that he sold P1,651.54 during the month of December, which was
as much as, if not more, than he had sold during the same month of the previous
year. The wrongfulness of the seizure was so apparent that a satisfactory
explanation of the same could easily have been given to the wholesale houses
with which he was doing business, and it apparently had no effect on his sales for
the month of December. As we have allowed him the profits on P600 for sales
which he was prevented from making during the month of November, it appears
that the damage from interruption to his business has been fully compensated.
so that, without touching upon the vexatious question of whether damages to
credit might be allowed in a proper case, we are of the opinion that such damages
Suit before the Court of First Instance of Bulacan on four causes of action to
recover the purchase price of rawhide delivered by plaintiff to defendant. Plaintiff
corporation has its principal office and place of business in Makati, Rizal.
Defendant is a resident of Meycauayan, Bulacan. Defendant moved to dismiss
upon the ground of improper venue. He claims that by contract suit may only be
lodged in the courts of Manila. The Bulacan court overruled him. He did not
answer the complaint. In consequence, a default judgment was rendered against
him on September 21, 1966, thus:
WHEREFORE, judgment is hereby rendered in favor of plaintiff and
against defendant ordering defendant to pay plaintiff the following
amounts:
First Cause of Action — P60,845.67, with interest thereon at 1% a month from May
full amount is paid.
 states that venue may be stipulated by written agreement — "By written
Second Cause of — agreement
P51,952.55, with interest thereon at 1% a month from March 30, 1965of the parties the venue of an action may be changed or transferred
until
Action the full amount is paid. from one province to another."

Defendant places his case upon Section 3 of Rule 4 just quoted. According to
defendant, plaintiff and defendant, by written contracts covering the four causes
Third Cause of — P53,973.07, with interest thereon at 1% a month from July of
3, 1965
action,until the
stipulated that: "The parties agree to sue and be sued in the Courts of
Action full amount is paid. Manila." This agreement is valid. Defendant says that because of such covenant
he can only be sued in the courts of Manila. We are thus called upon to shake
meaning from the terms of the agreement just quoted.
Fourth Cause of — P41,075.22, with interest thereon at 1% a month2 until the full amount is
But first to the facts. No such stipulation appears in the contracts covering the
Action paid.
first two causes of action. The general rule set forth in Section 2 (b), Rule 4,
governs, and as to said two causes of action, venue was properly laid in
Bulacan, the province of defendant's residence.
In addition, defendant shall pay plaintiff attorney's fees amounting to
25% of the principal amount due in each cause of action, and the costs of The stipulation adverted to is only found in the agreements covering the third
the suit. The amount of P400.00 shall be deducted from the total amount and fourth causes of action. An accurate reading, however, of the stipulation, "The
due plaintiff in accordance with this judgment. parties agree to sue and be sued in the Courts of Manila," does not preclude the
filing of suits in the residence of plaintiff or defendant. The plain meaning is that
ISSUES: the parties merely consented to be sued in Manila. Qualifying or restrictive words
which would indicate that Manila and Manila alone is the venue are totally absent
Whether or not venue was properly laid in the province of Bulacan where
therefrom. We cannot read into that clause that plaintiff and defendant bound
defendant is a resident.(YES)
themselves to file suits with respect to the last two transactions in question only
or exclusively in Manila. For, that agreement did not change or transfer venue. It
Whether or not the lower court's grant to plaintiff of interest at the rate of one
simply is permissive. The parties solely agreed to add the courts of Manila as
per centum per month is correct. (YES)
tribunals to which they may resort. They did not waive their right to pursue
Whether or not the attorneys' fees granted can be tagged as iniquitous or remedy in the courts specifically mentioned in Section 2(b) of Rule 4. Renuntiatio
unconscionable. (NO) non praesumitur.

RULING: Venue here was properly laid.

1. The forefront question is whether or not venue was properly laid in the
province of Bulacan where defendant is a resident.
Section 2 (b), Rule 4 of the Rules of Court on venue of personal actions triable by
courts of first instance — and this is one — provides that such "actions may be
commenced and tried where the defendant or any of the defendants resides or
may be found, or where the plaintiff or any of the plaintiffs resides, at the election
of the plaintiff." Qualifying this provision in Section 3 of the same Rule which
2. Defendant next challenges the lower court's grant to plaintiff of interest at the
rate of one per centum per month. Defendant says that no such stipulation as to
right of interest appears in the sales confirmation orders which provided:
"TERMS — 60 days after delivery with interest accruing on postdated cheques
beyond 30 days." The flaw in this argument lies in that the interest and the rate
thereof are expressly covenanted in the covering trust receipts executed by
defendant in favor of plaintiff, as follows: "All obligations of the undersigned
under this agreement of trust shall bear interest at the rate of one per centum
(1%) per month from the date due until paid."
On this score, we find no error.
3. Defendant protests the award of attorneys' fees which totals P51,961.63, i.e.,
25% of the total principal indebtedness of P207,846.51 (exclusive of interest).
Defendant's thesis is that the foregoing sum is "exorbitant and unconscionable."
To be borne in mind is that the attorneys' fees here provided is not, strictly
speaking, the attorneys' fees recoverable as between attorney and client spoken
of and regulated by the Rules of Court. Rather, the attorneys' fees here are in the
nature of liquidated damages and the stipulation therefor is aptly called a penal
clause. It has been said that so long as such stipulation does not contravene law,
morals, or public order, it is strictly binding upon defendant. The attorneys' fees
so provided are awarded in favor of the litigant, not his counsel. It is the litigant,
not counsel, who is the judgment creditor entitled to enforce the judgment by
execution.
The governing law then is Article 2227 of the Civil Code, viz.: "Liquidated
damages, whether intended as an indemnity or a penalty, shall be equitably
reduced if they are iniquitous or unconscionable." For this reason, we do not
really have to strictly view the reasonableness of the attorneys' fees in the light
of such factors as the amount and character of the services rendered, the nature
and importance of the litigation, and the professional character and the social
standing of the attorney. We do concede, however, that these factors may be an
aid in the determination of the iniquity or unconscionableness of attorneys' fees
as liquidated damages.
May the attorneys' fees (P51,961.63) here granted be tagged as iniquitous or
unconscionable? Upon the circumstances, our answer is in the negative.
Plaintiff's lawyers concededly are of high standing. More important is that this
case should not have gone to court. It could have been easily avoided had
defendant been faithful in complying with his obligations. It is not denied that the
rawhide was converted into leather and sold by defendant. He raises no defense.
In fact, he did not even answer the complaint in the lower court, and was thus
declared in default. Nor does he deny the principal liability. Add to all these the
fact that the writ of attachment issued below upon defendant's properties yielded
no more than P400 and the picture is complete. The continued maintenance by
defendant of the suit is plainly intended for delay. The attorneys' fees awarded
cannot be called iniquitous or unconscionable.
In the very recent case of Universal Motors Corporation vs. Dy Hian Tat (1969), 28
SCRA 161, 170, we allowed attorneys' fees in the form of liquidated damages at
the rate of 25% of the total amount of the indebtedness. Here, the trial court has
already reduced the attorneys' fees from the stipulated 25% "of the total amount
involved, principal and interest, then unpaid" to only 25% of the principal amount
due. There is no reason why such judgment should be disturbed.
FOR THE REASON GIVEN, the appealed judgment is hereby affirmed, except that
interest granted, in reference to the fourth cause of action, should start from
March 24, 1965. Costs against defendant-appellant. So ordered.
SOLID HOMES, INC., PETITIONER, VS. HON. COURT OF APPEALS, INVESTCO,
INC., ANGELA PEREZ STALEY, AND ANTONIO PEREZ, RESPONDENTS.
G.R. No. 97255, August 12, 1994, VITUG, J.
Facts:
An action for collection of sums of money, damages and attorney's fees was filed
with the Regional Trial Court (Civil Case No. 40615) of Pasig by private
respondents Investco, Angela Perez Staley and Antonio Perez Jr. against
petitioner Solid Homes, Inc.
Private respondents averred that, on 07 September 1976, they sold, under an
agreement entitled "contract to sell and to buy," to Solid Homes six (6) parcels of
land in Quezon City and Marikina, with an area of 704,443 sq.m., for a total selling
price of P10,211,075.00 payable in installments.
Private respondents asserted that Solid Homes violated the terms of the
agreement by refusing to pay the balance of P4,800,282.91 and by failing to
negotiate a settlement with the tenants and squatters of the property despite its
receipt from Investco of P350,000.00 for that specific purpose.
The trial court rendered judgment ordering the defendants to pay the plaintiffs
the following: 1) The amount of P4,800,282.91 with interest thereof at the rate of
one percent per month from February 23, 1981, until fully paid; 2) The amount
of P99,559.00 representing cost of science and transfer taxes which defendant
credited to its account with interest at the legal rate from the filing of the
complaint; 3) The amount of P250,000.00 to cover attorney's fees and litigation
expenses.
On appeal, the Court of Appeals (CA-G.R. CV No. 13400), modified the trial court's
judgment and rendered its own decision, dated 21 January 1991, resolving
thusly:
"PREMISES CONSIDERED, the judgment of the trial court is hereby
modified by ordering defendant-appellant to pay plaintiff the amount of
P4,800,282.91 with interest thereon at the rate of one percent per month
from March 22, 1982. The amount of attorney's fees is hereby reduced
from P250,000.00 to P50,000.00. The decision is AFFIRMED in all other
aspects."
In the instant petition for review, petitioner Solid Homes argues (a) that the Court
of Appeals should not have awarded attorney's fees, there being an absence of
any special finding of fact to justify such award, and (b) that it erred in declaring
due and demandable the entire unpaid balance still owing to private
respondents.
Issue:
Whether or not the CA erred in awarding the attorney’s fees. (Yes)
Ruling:
Article 2208 of the Civil Code allows attorney's fees to be awarded by a court
when its claimant is compelled to litigate with third persons or to incur expenses
to protect his interest by reason of an unjustified act or omission of the party from
whom it is sought. While judicial discretion is here extant, an award thereof
demands, nevertheless, a factual, legal or equitable justification. The matter
cannot and should not be left to speculation and conjecture.
In the case at bench, the records do not show enough basis for sustaining the
award for attorney's fees and to adjudge its payment by petitioner. On the
contrary, the appellate court itself has found that petitioner's act of withholding
payment could not be said to be all that unjustified. The disagreement of the
parties on the demandability of the amount still due and the accrual date of
interest has persisted largely because of supervening circumstances and the
perceived inexplicitness of the contract itself. The decision of the appellate court,
has, in fact, reversed that of the trial court on the imposition of interest from 23
February 1981, thus upholding, which we similarly find to be in order, the
position of petitioner that the accrual date should instead start only on 28 March
1982.
WHEREFORE, except on the award of attorney's fees which is hereby DELETED,
the decision of the Court of Appeals is AFFIRMED. No costs.
SO ORDERED.
3. Two concepts of attorneys fees: ordinary and extraordinary
sense
COMPANIA MARITIMA, INC., EL VARADERO DE MANILA, MINDANAO
TERMINAL AND BROKERAGE SERVICES, CARLOS P. FERNANDEZ, VICENTE
T. FERNANDEZ, LUIS T. FERNANDEZ, and RAMON B. FERNANDEZ,
Petitioners, v. COURT OF APPEALS and EXEQUIEL S. CONSULTA,
Respondents.
G.R. No. 128452. November 16, 1999. MENDOZA, J.:
FACTS: Maritime Company of the Philippines was sued by Genstar Container
Corporation before the RTC Manila. It was ordered to pay Genstar Container
Corporation the following amounts:chanrob1es virtual 1aw library
a. $469,860.35, or its equivalent in pesos at the current exchange rate.
1. b. 25% of the total obligation, P2,000.00 as Acceptance Fee, and
P250.00 per appearance — as Attorney’s Fees.
2.
3. c. Costs of suit.
As a result, properties of petitioners Compania Maritima, Inc., El Varadero de
Manila, and Mindanao Terminal and Brokerage Services were levied upon in
execution. The properties were worth P51,000,000.00 in sum. However, the same
were sold at public auction for only P1,235,000.00 to the highest bidder, a certain
Rolando Patriarca.
Petitioners Compania Maritima, Inc., El Varadero de Manila, and Mindanao
Terminal and Brokerage Services engaged the services of private respondent,
Atty. Exequiel S. Consulta, who represented them in the following cases: (1)
Civil Case No. 85-30134, entitled "Genstar Container Corporation v. Maritime
Company of the Philippines; (2) TBP Case No. 86-03662,; and (3) Civil Case No.
86-37196
The cases were eventually resolved in this wise: (1) in Civil Case No. 85-30134,
the trial court dismissed the third-party claim and motion for the issuance of a
writ of preliminary injunction filed by Atty. Consulta; (2) after Atty. Consulta filed
the complaint with the Tanodbayan in TBP Case No. 86-03662, petitioners
transferred the handling of the case to another lawyer; and (3) Civil Case No. 86-
37196 was eventually dismissed on motion of both parties, but only after the trial
court’s denial of the motion to dismiss filed by Genstar Container Corporation
was upheld on appeal by both the Court of Appeals and the Supreme Court.
For his services in the three cases, Atty. Consulta billed petitioners as follows: (1)
P100,000.00 for Civil Case No. 85-30134; (2) P50,000.00 for TBP Case No. 86-
03662; and (3) P5,000,000.00 for Civil Case No. 86-37196, including the
subsequent appeals to the Court of Appeals and the Supreme Court. Petitioners
did not pay the amount demanded but only P30,000.00 for Civil Case No. 85-
30134 and P10,000.00 for TBP Case No. 86-03662. 5
Because of the failure of corporate petitioners to pay the balance of his attorney’s
fees, Atty. Consulta brought suit against petitioners in the RTC QC. He likewise
asked for moral and exemplary damages, attorney’s fees, and the costs of suit.
The trial court rendered a decision which stated thatthe amount equivalent to
five percent (5%) of the amount involved, or the amount of Two Million Five
Hundred Fifty Thousand Pesos (P2,550,000.00) would be reasonable attorney’s
fees for the services rendered by the plaintiff in Civil Case No. 37196 and the two
related proceedings in the Court of Appeals and the Supreme Court. As for the
services rendered by the plaintiff in Civil Case No. 30134, for which he appears to
have already been paid P30,000.00, the Court believes that an additional amount
of P20,000.00 would be reasonable. On plaintiff’s demand of P40,000.00, in
addition to the P10,000.00 he had initially received for services rendered in the
Tanodbayan case No. 86-03662, the Court grants him an additional P20,000.00.
On appeal, the Court of Appeals affirmed the decision of the trial court. Hence,
this appeal.
ISSUE: Whether or not the amount of attorney’s fees awarded to the private
respondent by the court a quo and affirmed by the Honorable Court is reasonable.
RULING: YES.
It is pertinent to note two concepts of attorney’s fees in this jurisdiction. In the
ordinary sense, attorney’s fees represent the reasonable compensation paid to a
lawyer by his client for the legal services he has rendered to the latter. On the
other hand, in its extraordinary concept, attorney’s fees may be awarded by the
court as indemnity for damages to be paid by the losing party to the prevailing
party.
The issue in this case concerns attorney’s fees in the ordinary concept. Generally,
the amount of attorney’s fees due is that stipulated in the retainer agreement
which is conclusive as to the amount of the lawyer’s compensation. In the absence
thereof, the amount of attorney’s fees is fixed on the basis of quantum meruit. In
determining the amount of attorney’s fees, the following factors are considered:
(1) the time spent and extent of services rendered; (2) the novelty and difficulty
of the questions involved; (3) the importance of the subject matter; (4) the skill
demanded; (5) the probability of losing other employment as a result of the
acceptance of the proffered case; (6) the amount involved in the controversy and
the benefits resulting to the client; (7) the certainty of compensation; (8) the
character of employment; and (9) the professional standing of the lawyer.
Both the Court of Appeals and the trial court approved attorney’s fees in the
total amounts of P50,000.00 and P30,000.00 for the services of Atty.
Consulta in Civil Case No. 85-30134 and TBP Case No. 86-03662,
respectively. Based on the above criteria, we think said amounts are
reasonable, although the third-party claim and motion for the issuance of a writ
of preliminary injunction filed by Atty. Consulta in Civil Case No. 85-30134 was
dismissed by the trial court, while TBP Case No. 86-03662 was given by
petitioners to another lawyer after Atty. Consulta had filed the complaint. On the
other hand, although the order of the trial court in Civil Case No. 86-37196
granting the motion to dismiss filed by both parties did not state the grounds
therefor, it is reasonable to infer that petitioners agreed thereto in consideration
of some advantage. Hence, the rulings of the Court of Appeals and the trial
court that, because of the complexity of the issues involved and the work
done by counsel, the amount of P2,550,000.00 was reasonable for Atty.
Consulta’s services.
In addition, the value of the properties involved was considerable. As already
stated, to satisfy the judgment in favor of Genstar Container Corporation in Civil
Case No. 85-30134, properties of petitioners worth P51,000,000.00 were sold at
public auction. Only P1,235,000.00 was realized from the sale and petitioners
were in danger of losing their properties. As the appellate court pointed out, Atty.
Consulta rendered professional services not only in the trial court but in the
Court of Appeals and in this Court. There is no question that through his efforts,
properties owned by petitioners were saved from execution.
Petitioners contend, however, that: (1) the said cases merely involved simple issues;
(2) the pleadings filed by Atty. Consulta did not exhibit an extraordinary level of
competence, effort, and skill; and (3) they did not benefit from the efforts of Atty.
Consulta.
These allegations have not been proven. Petitioners have not shown that the
factual findings of both the Court of Appeals and the trial court are contrary to
the evidence. Nor have they shown that they did not benefit from their
representation by Atty. Consulta.
4. Interest in the concept of actual and compensatory damages
ANTONIO L. CASTELO, BERNABE B. BANSON, LOURDES A. BANSON, and
POMPEYO DEPANTE, petitioners, 
vs.
THE COURT OF APPEALS, 12th Division,
and MILAGROS DELA ROSA, respondents.
G.R. No. 96372, THIRD DIVISION, May 22, 1995, FELICIANO, J.:
FACTS:
Petitioners Antonio Castelo, Bernabe Banson, Lourdes Banson and Pompeyo
Depante entered into a contract denominated as a "Deed of Conditional Sale" with
private respondent Milagros Dela Rosa involving a parcel of land located in 1524
España Street, Sampaloc, Manila. The agreed price of the land was P269,408.00.
Upon signing the contract, private respondent paid petitioners P106,000.00
leaving a balance of P163,408.00.
The Deed of Conditional Sale also stipulated that the balance of P163,408.00 to
be paid on or before December 31, 1982 without interest and penalty charges,
and should the said balance [remain unpaid] by the VENDEE, the VENDORS
hereby agree to give the VENDEE a grace period of SIX (6) months or up to June
30, 1983 to pay said balance provided that interest at the rate of 12% per annum
shall be charged and 1% penalty charge a month shall be imposed on the
remaining diminishing balance.
Private respondent was unable to pay the remaining balance. petitioners filed an
action for specific performance with damages in the Regional Trial Court (RTC)
of Manila against Dela Rosa.
The RTC ordered the rescission of the Deed of Conditional Sale. Petitioners then
went on Certiorari to the Court of Appeals questioning the trial court's decision
rescinding the Deed of Conditional Sale. In a decision written by Castro-
Bartolome, J., dated 21 November 1986, the Court of Appeals, in CA G.R. No.
07938-SP, annulled and set aside the RTC's decision of 17 August 1984. In its
dispositive portion, the Court of Appeals decision stated:
2) ordering the defendant to comply with her obligation under the
conditional sale to pay the balance of the conditional sale in the amount
of P163,408.00, to pay interest and in default thereof the rescission
thereof is the alternative.
A writ of execution of the 21 November 1986 judgment of the Court of Appeals
was issued by the trial court on 2 September 1988. Accordingly, a Sheriff's Notice
to Pay Judgment was served on private respondent Dela Rosa requiring her to
pay petitioners a total of One Hundred Ninety Seven Thousand Seven Hundred
Twenty Three Pesos and Sixty Eight Centavos (P197,723.68), computed as
follows:
Principal P163,408.00
plus interest of
12% (per contract)
from 21 Nov. 1986 to
2 Sept. 1988 34,315.6800
——————
Total amount of judgment
(excluding sheriff's fees
and expenses) P197,723.68 3
Petitioners filed a motion for reconsideration and a separate motion for alias writ
of execution contending that the sum of P197,723.68, based on the Sheriff's own
computation, was erroneous. They argued that the obligation of private
respondent was to pay (a) interest at the rate of twelve percent (12%) per annum
plus(b) one percent (1%) penalty charge per month, from default, i.e. from 1
January 1983, thus, the amount to be paid by the Defendant should be
P398,814.88 instead and not P197,723.68.
In an Order of 18 April 1990, the trial court denied the motion for alias writ of
execution and the motion for reconsideration. In denying petitioners' motions,
the trial court stated that it did not have authority to enlarge the scope of the
dispositive portion of the Court of Appeals' decision which was the subject of
execution. Petitioners then went on Certiorari for the second time to the Court of
Appeals claiming that the trial court had acted with grave abuse of discretion.
Hence this Petition for Review contending that, in the Luna, J. decision, the Court
of Appeals had erred in ignoring the stipulation for payment of interest in case of
default found in the "Deed of Conditional Sale."
ISSUE:
What is the correct interpretation of the phrase "to pay interest" set out in the
dispositive portion of the 21 November 1986 decision of Castro-Bartolome, J.?
RULING:
The established doctrine is that when the dispositive portion of a judgment,
which has become final and executory, contains a clerical error or an ambiguity
arising from an inadvertent omission, such error or ambiguity may be clarified
by reference to the body of the decision itself.
The dispositive portion itself failed to specify expressly whether Castro-
Bartolome, J. was referring to the payment of interest in accordance with the
terms and conditions of the "Deed of Conditional Sale" or whether the
requirement of "to pay interest" related, not to the interest provisions of the
Conditional Sale Deed between petitioners and private respondent, but rather to
legal interest on the amount of the unpaid balance of the purchase price of the
land which would begin to accrue from the date of the entry of the Castro-
Bartolome judgment on 12 February 1987.
We believe and so hold that the phrase "to pay interest," found in the dispositive
portion of the Castro-Bartolome decision must, under applicable law, refer to the
interest stipulated by the parties in the Deed of Conditional Sale which they had
entered into on 15 October 1982.
There is, in the second place, no question that private respondent Dela Rosa had
failed to pay the balance of P163,408.00 on or before 31 December 1982. The
applicable law is to be found in Article 2209 of the Civil Code which provides as
follows:
If the obligation consists in the payment of a sum of money, and the debtor incurs
in delay, the indemnity for damages, there being no stipulation to the contrary,
shall be the payment of the interest agreed upon, and in the absence of
stipulation, the legal interest which is six percent (6%) per annum. (Emphasis
supplied)
Under Article 2209, the appropriate measure for damages in case of delay in
discharging an obligation consisting of the payment of a sum of money is the
payment of penalty interest at the rate agreed upon in the contract of the parties.
In the absence of a stipulation of a particular rate of penalty interest, payment of
additional interest at a rate equal to the regular or monetary interest, becomes
due and payable. Finally, if no regular interest had been agreed upon by the
contracting parties, then the damages payable will consist of payment of legal
interest which is six percent (6%) or, in the case of loans or forbearances of
money, twelve percent (12%) per annum. Applying Article 2209 to the instant
case, we must refer to the "Deed of Conditional Sale" which, as already noted, had
specifically provided for "interest at the rate of 12% per annum" and a "1%
penalty charge a month [to] be imposed on their remaining diminishing balance."
There was, it thus appears, no need for the subsequent Luna, J. decision to refer
at all to the payment of legal interest from the time of entry of the Castro-
Bartolome decision.
Article 2209 governs transactions involving the payment of indemnity in the
concept of damages arising from delay in the discharge of obligations consisting
of the payment of a sum of money. The "obligation consisting in the payment of a
sum of money" referred to in Article 2209 is not confined to a loan or forbearance
of money. The Court has, for instance, consistently applied Article 2209 in the
determination of the interest properly payable where there was default in the
payment of the price or consideration under a contract of sale as in the case at
bar.
The stipulation in the "Deed of Conditional Sale" requiring the payment of
interest is not unlawful. The validity of the contract of conditional sale itself has
not been put to question by private respondent dela Rosa and there is nothing in
the record to suggest that the same may be contrary to law, morals, good custom,
public order or public policy.
We turn, therefore, to the examination of the contractual stipulation on interest
which we quoted in full earlier. Under the terms of that stipulation, private
respondent was bound, and entitled, to pay the balance of P163,408.00 on or
before 31 December 1982 without incurring any liability for any interest and
penalty charges. During the grace period of six (6) months, that is, from 1 January
1983 to 30 June 1983, private respondent vendee was given the right to pay the
said balance or any portion that had remained unpaid provided that "interest at
the rate of 12% per annum shall be charged and 1% penalty charge shall be
imposed on the remaining diminishing balance." We observe that residual
ambiguity infects this particular portion of the stipulation on payment of interest.
The question is whether, during the period of 1 January 1983 up to 30 June 1983,
12% interest per annum plus 1% penalty charge a month was payable "on the
remaining diminishing balance;" or whether during the period from 1 January
1983 to 30 June 1983, only12% per annum interest was payable while the 1%
per month penalty charge would in addition begin to accrue on any balance
remaining unpaid as of 1 July 1983.
We believe that the contracting parties intended the latter view of their
stipulation on interest; for if the parties had intended that during the grace period
from 1 January 1983 to 30 June 1983, interest consisting of 12%per annum plus
another 12% per annum (equivalent to 1% per month), or a total of 24% per
annum, was payable, then they could have simply said so. Instead, the parties
distinguished between interest at the rate of 12% per annum and the 1% a month
penalty charge. The interpretation we adopt is also supported by the principle
that in case of ambiguity in contract language, that interpretation which
establishes a less onerous transmission of rights or imposition of lesser burdens
which permits greater reciprocity between the parties, is to be adopted.
DISPOSITIVE PORTION:
WHEREFORE, for all foregoing, the Petition for Review is hereby GRANTED. The
Decision of the Court of Appeals dated 22 August 1990 in C.A.-G.R SP No. 22464
(the Luna, J. decision) is hereby REVERSED and SET ASIDE and the dispositive
portion of the Decision by Castro-Bartolome, J., dated 21 November 1986, in C.A.-
G.R No. 07938-SP is hereby CLARIFIED as follows:
WHEREFORE, the writ of certiorari is hereby GRANTED annulling the
Decision of Judge Malaya dated August 17, 1984 and a new one entered:
(1) allowing the amendment of the complaint to conform to the evidence already
presented and defaulted defendant to answer the amendment within the
reglementary period;
(2) ordering the defendant to comply with her obligation under the conditional
sale to pay the balance of the conditional sale in the amount of P163,408.00, to
pay interest on the amount of the balance remaining unpaid during the period
from 1 January 1983 to 30 June 1983 at the rate of 12% per annum; and, from 1
July 1983 until full payment of the amount due, to pay interest at the rate of 12%
per annum plus another 12% per annum (i.e., 1% penalty charge per month), or
a total of 24% per annum, on the balance remaining unpaid; and
(3) In default thereof, the rescission of the "Deed of Conditional Sale" is the
alternative.
No pronouncement as to costs.
 BATAAN SEEDLING ASSOCIATION, INC. and CARLOS VALENCIA,
petitioners, vs. REPUBLIC OF THE PHILIPPINES, represented by the
DEPARTMENT OF ENVIRONMENT and NATURAL RESOURCES,
respondent.
FACTS: Petitioner Bataan Seedling Association, Inc. (BSAI) entered into a
Community Based Reforestation Contract with the Republic of the
Philippines (Republic), represented by the Department of Environment
and Natural Resources (DENR). Under said contract, BSAI, bound itself to
undertake the reforestation of a fifty-hectare open/denuded forest land
in Barangay Liyang, Pilar, Bataan within a period of three (3) years. BSAI
likewise undertook to report to the DENR any event or condition which
delays or may delay or prevent completion of the work, and submit
progress billings and accomplishment reports. Concomitant with the
contract is the Project Development Plan and the Approved Schedule of
Progress Payments detailing the annual cash flow and schedule of
activities within the three-year period, and the Contract of Undertaking
providing for the mobilization fund (₱75,054.66), which was allotted
and released by respondent to enable BSAI to start with the project,
but the fund was to be returned to respondent upon completion of
the project or deducted from the periodic release of moneys to BSAI.
Believing that BSAI failed to comply with their obligations under the
contract, the Republic sent a notice of cancellation to Carlos Valencia,
President of BSAI, asking the latter to show cause why the contract should
not be terminated on the grounds of:
(1) Willful violation of the material terms and conditions, stipulations and
covenants of the Contract such as: (a) failure to fully plant the whole 50-
hectare contracted area within the time provided; (b) seedlings raised in
the nursery were disposed of to other contractors and the seedlings left
were practically overgrown; (c) failure to report the forest fire that
occurred sometime in December; and (d) failure to submit
accomplishment reports and other relevant information
(2) Abandonment of the project area.
Due to their failure to respond to the notice of cancellation, as well as
return the mobilization fund, the Republic filed a Complaint for Damages
against BSAI and its president, praying that the latter jointly and solidarily
pay actual damages totaling One Hundred Thirty Seven Thousand Five
Hundred Four Pesos and Forty Seven Centavos (₱137,504.47). The
Republic also sought liquidated damages equivalent to 0.1% of the total
contract cost due to BSAI’s delay in the performance of its obligations, and
exemplary damages in the amount of Fifty Thousand Pesos (₱50,000.00).
The RTC rendered its decision ordering petitioners to pay the amount of
Fifty Thousand Pesos (₱50,000.00) as exemplary damages. The trial court
held that respondent had sufficient grounds to cancel the contract but saw
no reason why the "mobilization fund" and the advance payments should
be refunded, or that petitioners should be liable for liquidated damages.
Not satisfied, both respondent and petitioners appealed the decision to
the Court of Appeals. The appellate court affirmed with modification
the decision of the trial court, adjudicating the balance of the
mobilization fund refunded by petitioners in the amount of
₱56,290.69 with 12% interest.
ISSUE: Whether the order to refund the amount of P56,290.69 with
interest at the rate of 12% per annum, representing the balance of the
mobilization fund, is palpably erroneous as being contrary to the facts.
RULING: NO. The Contract of Undertaking signed by petitioners is explicit
in this regard, to wit:
"THAT BATAAN SEEDLING ASSOCIATION, INCORPORATED x x x, for and
in consideration of the sum of Seventy Five Thousand Fifty four pesos and
sixty six centavos (P75,054.66) representing advance payment under said
contract receipt of which is hereby acknowledge in full, as hereby bind
ourselves;
xxx
 3. To repay the amount advanced in accordance with the Contract of
Reforestation and DENR Administration order No. 14 Series of 1989
as amended;"
The amount of ₱75,054.66 advanced to BSAI, represents 15% of
₱500,361.72, the contract cost for the 1st year. When initial payment was
made by the Republic to BSAI on February 25, 1991, the amount of
₱18,763.56, or 1/4 of the mobilization fund, was deducted, leaving a
balance of ₱56,290.69. The Republic thereafter made no deductions on
the subsequent payments of the contract price remitted to BSAI. Hence,
they remain liable on the balance of said fund in the amount of Fifty Six
Thousand Two Hundred Ninety Pesos and Sixty Nine Centavos
(₱56,290.69). We find no error committed by the Appellate Court on this
matter.
Nevertheless, the appellate court erred in imposing a 12% interest
on the amount due. Interest at the rate of 12% per annum is imposable
if there is no stipulation in the contract. Herein subject contract does not
contain any stipulation as to interest. However, the amount that is due the
respondent does not represent a loan or forbearance of money. The word
"forbearance" is defined, within the context of usury law, as a contractual
obligation of lender or creditor to refrain, during given period of time,
from requiring borrower or debtor to repay loan or debt then due and
payable. The contract between petitioner and respondent is a Community
Based Reforestation Contract by virtue of which petitioner undertook the
reforestation of a fifty-hectare open/denuded forest land. The amount of
Fifty Six Thousand Two Hundred Ninety Pesos and Sixty Nine Centavos
(₱56,290.69) due to respondent, represents the balance of the
mobilization fund which petitioner is obliged to return because of its
failure to fully comply with its undertaking to plant the entire area with
seedlings within the period contracted for reforestation. Under the
reforestation contract, the fund released to petitioner was supposed to be
returned to respondent upon completion of the project or deducted from
the periodic releases of money. Clearly therefrom, the amount of Fifty Six
Thousand Two Hundred Ninety Pesos and Sixty Nine Centavos
(₱56,290.69) was neither a loan nor forbearance of money.
In the absence of stipulation, the legal interest is six percent (6%) per
annum on the amount finally adjudged by the Court. In addition, the
amount of ₱56,290.69 shall earn 12% interest per annum from date of
finality of herein judgment.
Finally, the Court finds the award of Fifty Thousand Pesos (₱50,000.00)
as exemplary damages to be excessive and should therefore be reduced to
Twenty Thousand Pesos (₱20,000.00). Exemplary damages are imposed
not to enrich one party or impoverish another but to serve as a deterrent
against or as a negative incentive to curb socially deleterious actions.
WHEREFORE, the petition is partly GRANTED and the assailed Decision
is AFFIRMED with the following MODIFICATIONS:
1) The interest to be paid on the amount of Fifty Six Thousand Two
Hundred Ninety Pesos and Sixty Nine Centavos (₱56,290.69) shall be at
the rate of 6% per annum from the Court of Appeals Decision dated
October 14, 1998. A twelve percent (12% ) interest, in lieu of six percent
(6%) shall be imposed upon finality of this decision, until full payment
thereof.
2) The award of exemplary damages is reduced from Fifty Thousand
Pesos (₱50,000.00) to Twenty Thousand Pesos (₱20,000.00).
SO ORDERED.
FIRST DIVISION
[G.R. NO. 147791 : September 8, 2006]
CONSTRUCTION DEVELOPMENT CORPORATION OF THE PHILIPPINES,
Petitioner, v. REBECCA G. ESTRELLA, RACHEL E. FLETCHER, PHILIPPINE
PHOENIX SURETY & INSURANCE INC., BATANGAS LAGUNA TAYABAS BUS
CO., and WILFREDO DATINGUINOO, Respondents.
Facts:
Respondents Rebecca G. Estrella and her granddaughter, Rachel E. Fletcher,
boarded in San Pablo City, a BLTB bus bound for Pasay City. However, they
never reached their destination because their bus was rammed from behind by
a tractor-truck of CDCP in the South Expressway. The strong impact pushed
forward their seats and pinned their knees to the seats in front of them. They
regained consciousness only when rescuers created a hole in the bus and
extricated their legs from under the seats. They were brought to the Makati
Medical Center where the doctors diagnosed their injuries. Thereafter,
respondents filed a Complaint for damages against CDCP, BLTB, Espiridion
Payunan, Jr. and Wilfredo Datinguinoo before the Regional Trial Court of Manila.
They alleged:
(4) that they suffered actual damages amounting to P250,000.00 for Estrella and
P300,000.00 for Fletcher;
(5) that they suffered physical discomfort, serious anxiety, fright and mental
anguish, besmirched reputation and wounded feelings, moral shock, and lifelong
social humiliation;
(6) that defendants failed to act with justice, give respondents their due, observe
honesty and good faith which entitles them to claim for exemplary damage; and
(7) that they are entitled to a reasonable amount of attorney's fees and litigation
expenses.
the trial court rendered a decision finding CDCP and BLTB and their employees
liable for damages, the dispositive portion of which, states:
WHEREFORE, judgment is rendered:
In the Complaint'
1. In favor of the plaintiffs and against the defendants BLTB, Wilfredo
Datinguinoo, Construction and Development Corporation of the Philippines (now
PNCC) and Espiridion Payunan, Jr., ordering said defendants, jointly and severally
to pay the plaintiffs the sum of P79,254.43 as actual damages and to pay the sum
of P10,000.00 as attorney's fees or a total of P89,254.43;
2. In addition, defendant Construction and Development Corporation of the
Philippines and defendant Espiridion Payunan, Jr., shall pay the plaintiffs
the amount of Fifty Thousand (P50,000.00) Pesos to plaintiff Rachel
Fletcher and Twenty Five Thousand (P25,000.00) Pesos to plaintiff Rebecca
Estrella;
The trial court held that BLTB, as a common carrier, was bound to observe
extraordinary diligence in the vigilance over the safety of its passengers. It must
carry the passengers safely as far as human care and foresight provide, using the
utmost diligence of very cautious persons, with a due regard for all the
circumstances. Thus, where a passenger dies or is injured, the carrier is
presumed to have been at fault or has acted negligently. BLTB's inability to carry
respondents to their destination gave rise to an action for breach of contract of
carriage while its failure to rebut the presumption of negligence made it liable to
respondents for the breach. Regarding CDCP, the trial court found that the
tractor-truck it owned bumped the BLTB bus from behind. Evidence
showed that CDCP's driver was reckless and driving very fast at the time of
the incident. The gross negligence of its driver raised the presumption that CDCP
was negligent either in the selection or in the supervision of its employees which
it failed to rebut thus making it and its driver liable to respondents.
Respondents elevated the case to the Court of Appeals which affirmed the
decision of the trial court but modified the amount of damages, the dispositive
portion of which provides:
WHEREFORE, the assailed decision dated October 7, 1993 of the Regional Trial
Court, Branch 13, Manila is hereby AFFIRMED with the following
MODIFICATION:
1. The interest of six (6) percent per annum on the actual damages of
P79,354.43 should commence to run from the time the judicial demand was
made or from the filing of the complaint on February 4, 1980;
2. Thirty (30) percent of the total amount recovered is hereby awarded as
attorney's fees;
3. Defendants-appellants Construction and Development Corporation of the
Philippines (now PNCC) and Espiridion Payunan, Jr. are ordered to pay plaintiff-
appellants Rebecca Estrella and Rachel Fletcher the amount of Twenty Thousand
(P20,000.00) each as exemplary damages and P80,000.00 by way of moral
damages to Rachel Fletcher.
The Court of Appeals held that the actual or compensatory damage sought by
respondents for the injuries they sustained in the form of hospital bills were
already liquidated and were ascertained.
Accordingly, the 6% interest per annum should commence to run from the time
the judicial demand was made or from the filing of the complaint and not from
the date of judgment. The Court of Appeals also awarded attorney's fees
equivalent to 30% of the total amount recovered based on the retainer agreement
of the parties.
Issue:
WON the damages, attorney's fees and legal interest awarded by the CA are
excessive and unfounded
Ruling: NO. Moral damages may be recovered in quasi-delicts causing physical
injuries. The award of moral damages in favor of Fletcher and Estrella in the
amount of P80,000.00 must be reduced since prevailing jurisprudence fixed the
same at P50,000.00. While moral damages are not intended to enrich the plaintiff
at the expense of the defendant, the award should nonetheless be commensurate
to the suffering inflicted.
The Court of Appeals correctly awarded respondents exemplary damages in the
amount of P20,000.00 each. Exemplary damages may be awarded in addition to
moral and compensatory damages. Article 2231 of the Civil Code also states that
in quasi-delicts, exemplary damages may be granted if the defendant acted with
gross negligence.25 In this case, petitioner's driver was driving recklessly at the
time its truck rammed the BLTB bus. Petitioner, who has direct and primary
liability for the negligent conduct of its subordinates, was also found negligent in
the selection and supervision of its employees. In Del Rosario v. Court of Appeals,
we held, thus:
ART. 2229 of the Civil Code also provides that such damages may be imposed, by
way of example or correction for the public good. While exemplary damages
cannot be recovered as a matter of right, they need not be proved, although
plaintiff must show that he is entitled to moral, temperate or compensatory
damages before the court may consider the question of whether or not exemplary
damages should be awarded. Exemplary Damages are imposed not to enrich one
party or impoverish another but to serve as a deterrent against or as a negative
incentive to curb socially deleterious actions.
Regarding attorney's fees, we held in Traders Royal Bank Employees Union-
Independent v. National Labor Relations Commission,27 that:
There are two commonly accepted concepts of attorney's fees, the so-called
ordinary and extraordinary. In its ordinary concept, an attorney's fee is the
reasonable compensation paid to a lawyer by his client for the legal services he
has rendered to the latter. The basis of this compensation is the fact of his
employment by and his agreement with the client.
In its extraordinary concept, an attorney's fee is an indemnity for damages
ordered by the court to be paid by the losing party in a litigation. The basis of this
is any of the cases provided by law where such award can be made, such as those
authorized in Article 2208, Civil Code, and is payable not to the lawyer but to the
client, unless they have agreed that the award shall pertain to the lawyer as
additional compensation or as part thereof. (Emphasis supplied)cralawlibrary
In the instant case, the Court of Appeals correctly awarded attorney's fees and
other expenses of litigation as they may be recovered as actual or compensatory
damages when exemplary damages are awarded; when the defendant acted in
gross and evident bad faith in refusing to satisfy the plaintiff's valid, just and
demandable claim; and in any other case where the court deems it just and
equitable that attorney's fees and expenses of litigation should be recovered. 29
Regarding the imposition of legal interest at the rate of 6% from the time of the
filing of the complaint, we held in Eastern Shipping Lines, Inc. v. Court of Appeals,
that when an obligation, regardless of its source, i.e., law, contracts, quasi-
contracts, delicts or quasi-delicts is breached, the contravenor can be held liable
for payment of interest in the concept of actual and compensatory damages, 31
subject to the following rules, to wit '
1. When the obligation is breached, and it consists in the payment of a sum of
money, i.e., a loan or forbearance of money, the interest due should be that which
may have been stipulated in writing. Furthermore, the interest due shall itself
earn legal interest from the time it is judicially demanded. In the absence of
stipulation, the rate of interest shall be 12% per annum to be computed from
default, i.e., from judicial or extrajudicial demand under and subject to the
provisions of Article 1169 of the Civil Code.
2. When an obligation, not constituting a loan or forbearance of money, is
breached, an interest on the amount of damages awarded may be imposed at the
discretion of the court at the rate of 6%per annum. No interest, however, shall be
adjudged on unliquidated claims or damages except when or until the demand
can be established with reasonable certainty. Accordingly, where the demand is
established with reasonable certainty, the interest shall begin to run from the
time the claim is made judicially or extrajudicially (Art. 1169, Civil Code) but
when such certainty cannot be so reasonably established at the time the demand
is made, the interest shall begin to run only from the date the judgment of
the court is made (at which time the quantification of damages may be
deemed to have been reasonably ascertained). The actual base for the
computation of legal interest shall, in any case, be on the amount finally adjudged.
3. When the judgment of the court awarding a sum of money becomes final
and executory, the rate of legal interest, whether the case falls under
paragraph 1 or paragraph 2, above, shall be 12% per annum from such
finality until its satisfaction, this interim period being deemed to be by then
an equivalent to a forbearance of credit. (Emphasis supplied)cralawlibrary
Accordingly, the legal interest of 6% shall begin to run on February 9, 1993
when the trial court rendered judgment and not on February 4, 1980 when
the complaint was filed. This is because at the time of the filing of the
complaint, the amount of the damages to which plaintiffs may be entitled
remains unliquidated and unknown, until it is definitely ascertained,
assessed and determined by the court and only upon presentation of proof
thereon. From the time the judgment becomes final and executory, the
interest rate shall be 12% until its satisfaction.
F. Extent or Scope of Actual Damages
1. In contracts and quasi-contracts
 JUAN RODRIGUEZ, Plaintiff-Appellant, v. FINDLAY & CO., Defendant-
Appellee.
G.R. No. 4606, FIRST DIVISION, October 19, 1909, MORELAND, J.
FACTS: The plaintiff (Juan Rodriguez) was the owner of a freight ship called the
Constancia, then in course of construction in plaintiff’s shops in the city of Manila.
One William Swann was the consulting engineer of the defendant, in charge of its
machinery department. The plaintiff was acquainted with Swann and knew him
to be an engineer and naval architect of long experience. Rogaciano Rodriguez,
acting for and on behalf of the plaintiff and as his agent, made a written contract
with Swann, acting for and on behalf of the defendant and as its agent, wherein
the plaintiff agreed to purchase to the defendant, and the defendant agreed to sell
and deliver to the plaintiff, certain machinery, complete, for the ship Constancia
already referred to. Neither the plaintiff nor his agent, Rogaciano Rodriguez, was
a marine or other engineer and they knew little or nothing about the kind of
machinery which should be placed in the ship they were building. They relied
entirely upon the recommendations, knowledge, and experience of the engineer
Swann. The plaintiff had in mind and stated to Swann, among other things, the
speed which it was necessary that the Constancia should have in order to be
available as a coastwise vessel, and left the kind, nature, and construction of the
machinery to the greater knowledge and experience of Swann. This is particularly
true of the propeller placed in that vessel. The contract, so far as its interpretation
is disputed, reads as follows:
"One brass propeller of 8’ diameter and suitable pitch for an expected speed of ship
about 9 1/2 knots.
"The whole to be suitable for a wooden ship of 150 ft. long by 24 ft. beam and 14 ft.
depth, as per plan supplied by Sr. Juan Rodriguez."
In the process of manufacturing the propeller the defendant thought it
discovered that the propeller described in the contract would not give the speed
required by the contract and notified the plaintiff to that effect, and at the same
time asked permission to put in its place a propeller 10 feet in diameter. This the
plaintiff declined to permit.
The machinery was duly installed in the vessel upon its delivery. Upon the trial
of the ship, after the installation of its machinery, it was found that all of the
machinery worked well except the propeller. This, instead of giving the ship a
speed of about 9 1/2 knots an hour, gave a speed of less than 7 knots an hour.
The contention of the plaintiff is that, under the terms of the contract, the
defendant was obliged to furnish a propeller 8 feet in diameter which would give
the Constancia a speed of 9 1/2 knots an hour, and that, failing in that, the
contract was broken and the defendant should be held liable for all damages
resulting.
The defendant contends that the machinery was to be according to the
specifications in the contract and that, if these specifications were complied with,
it does not matter what may be the actual speed of the vessel. It claims that it had
nothing to do with the construction of the steamship or the placing therein of the
machinery. The defendant also claims that, under the terms of the contract, there
was no guaranty of speed, and that, if the propeller was 8 feet in diameter and of
brass, it would fulfill the terms of the contract even though the speed of the vessel
should not exceed a knot per hour.
The plaintiff filed a complaint for damages for breach of a written contract against
the defendant for the delivery of the machinery, complete, for a ship in process of
construction belonging to the plaintiff.
The defendant, in its answer, denies the allegations of the complaint generally,
and sets up as a counterclaim the balance due from plaintiff on the purchase price
of the machinery aforesaid, and asks for an affirmative judgment against the
plaintiff accordingly.
The defendant secured in the court below an affirmative judgment against the
plaintiff for the sum of P9,216.60, with interest thereon, at the rate of 6 per cent
per annum, from February 28, 1907.
ISSUE: Whether or not the plaintiff is entitled to damages.
RULING: YES.The contract, by its words, expressly requires that the defendant
must furnish a propeller which shall give to the steamship Constancia a speed of
about 9 1/2 knots per hour. The language is without ambiguity.
The ship for which the machinery, including the propeller, was designed, is
specifically described in the contract and is identified without question. That ship
is the Constancia, a coastwise vessel 150 feet long, 24 feet wide and 14 feet deep.
These are the measurements contained in the contract. During the course of the
negotiations the defendant’s agent, Swann, its engineer and naval architect,
several times visited the yard wherein the ship was being built and examined it
for the purpose of making the contract for the machinery. During these different
visits the kind of machinery, its purpose and value were discussed by the parties.
This is conceded. Swann was a naval architect and marine engineer of long
experience, which fact was known to the plaintiff and his agent, and the general
details relative to the kind and character of the machinery were left to the
defendant. The thing mainly insisted upon by the plaintiff was the result that
should be produced. The plaintiff himself testifies, and this is undisputed by the
defendant, that he relied upon Swann in these particulars, especially in reference
to the propeller and the pitch which it should have; and, by reason of that
reliance, the pitch in feet and inches which the propeller should have when placed
in the ship was not stated in the contract. Instead, the plaintiff placed in the
contract what the propeller should do, rather than what it should be. The
diameter of the propeller was fixed by the structure of the vessel and could not
exceed 8 feet or 8 1/2 feet. The pitch which the propeller should have in order to
give 9 1/2 knots an hour to the steamship was left to the greater knowledge and
experience of the defendant’s agent, Swann. The plaintiff placed the condition
only that it should produce a certain result when attached to the ship Constancia.
The words of the contract clearly demand, upon the part of the defendant, that it
furnish a propeller with a pitch proper to give the steamship Constancia a speed
of about 9 1/2 knots per hour. Language for that purpose could scarcely be made
plainer than the language used.
Simply because the specific pitch in feet and inches is not stated in the contract
does not mean that there is no specification upon that point. The contract
provides that the defendants shall supply to the plaintiff, among other things, one
brass propeller 8 feet in diameter with suitable pitch for an expected speed of
ship about 9 1/2 knots. The word "suitable" has reference to two objects, the
antecedent subject, "pitch" of the propeller, and the subsequent object, "ship;"
and the meaning of the word requires that the subject, "pitch" of the propeller,
shall have qualities which will harmonize so perfectly with the qualities of the
object, "ship," that a certain and specified result, viz, a speed of 9 1/2 knots, shall
be produced. The word "suitable," referring to the vessel in which the propeller
is to be placed as well as to the propeller itself, the pitch of the propeller must,
therefore, be suitable to that vessel, and it is not suitable to that vessel, under the
terms of the contract, unless with the other machinery mentioned in the contract
it gives to that vessel a speed of about 9 1/2 knots an hour. Therefore, the
specifications contained in the contract are not complied with until the vessel
shall have received from the machinery installed a speed of about 9 1/2 knots an
hour. The word "suitable" is perfectly definite and clear in its meaning and its
reference is undoubted. The failure of the propeller to give a speed anything like
9 1/2 knots an hour indicates clearly and beyond question that the pitch of the
propeller was not suitable for the purposes specified in the contract.
It should be noted, however, that, before the contract was signed, the defendant,
and its agent, Swann, were furnished with a plan or plans of the hull of the vessel,
showing the sternpost and the rudderpost fully and fairly; that Swann had
himself inspected the vessel several times at the yard where it was being built
and knew all about the said sternpost and rudderpost and their relative locations.
Yet, with that plan in his hand and with that knowledge in his head, he,
nevertheless, made a contract in which he agreed to furnish a propeller
which would give a speed of 9 1/2 knots an hour to that very ship. It is thus
apparent that the expert Swann again made a serious mistake in claiming that the
failure of speed was due solely to the place in which the propeller worked.
The defendant also maintains that the plaintiff ought not to recover in this case
because before the propeller was constructed the defendant notified him that a
propeller 8 feet in diameter would not produce the results specified in the
contract and that in order to attain those results it would be necessary to place in
that ship a propeller 10 feet in diameter; that the plaintiff rejected this proposal
and refused to accept a propeller of any dimensions different from that specified
in the contract, and that, therefore, he brought his misfortune on his own head.
The plaintiff was perfectly justified in refusing to change the whole structure of
the rear of his vessel in order to accommodate the defendant. His refusal was
justified by subsequent events; for, later, as before stated, a propeller 8 1/2 feet
in diameter, but of different pitch and area, was placed in the ship, without any
change in the construction of the hull, and the vessel immediately attained a
speed of 9 knots, or thereabouts, per hour.
It is thus apparent that the defendant failed to comply with the terms of the
contract in respect to the propeller therein described, and the plaintiff, in
consequence, is entitled to recover appropriate damages by reason thereof.
The damages recoverable of a manufacturer or dealer for the breach of
warranty of machinery which he contracts to furnish or place in operation
for a known purpose are not confined to the difference in value of the
machinery as warranted and as it proves to be, but include such
consequential damages as are the direct, immediate, and probable result of
the breach.
The loss of the buyer’s time and of that of his laborers resulting from the breach
is recoverable where the circumstances of the sale were such as to have put the
seller upon notice that such a loss would probably result from a breach.
Indemnity for losses and damages includes not only the amount of the loss which
may have been suffered, but also that of the profit which the creditor may have
failed to realize. (Art. 1106, Civil Code.)
The losses and damages for which a creditor in good faith is liable are those
foreseen, or which may have been foreseen, at the time of constituting the
obligation, and which may be a necessary consequence of its nonfulfillment. (Art.
1107, Civil Code.)
In an action against a manufacturer or dealer for a breach of warranty upon a sale
of goods, which he knew at the time of the sale were intended to be used for a
particular purpose, the measure of damages is not limited to the difference in
value of the goods as warranted, and as they prove to be, as in cases where like
articles are sold as merchandise for general purposes; but profits lost and
expenses incurred, because of the breach, may be recovered.
It is apparent from the authorities above cited that the plaintiff is entitled to
recover P375, the value of 30 tons of coal consumed in the trials necessarily made
to determine whether or not the propeller had the qualities specified in the
contract; also the sum of P707, the wages of employees and other necessary
expenses incurred during said trials.
The plaintiff not having presented competent proof as to the loss he sustained by
reason of his ship being out of commission during the time intervening between
the trial of the first propeller and the installation of the second, nothing can be
awarded him as damages in relation thereto. He is, however, entitled to be
allowed as damages the sum of P2,770.36, the amount paid by him for the first
propeller, as its purchase price, the same being worthless to him for the purpose
for which he bought it — said propeller to be and remain the property of the
defendant, with the right to retake the same if it has not already done so.
DISPOSITIVE PORTION:
We find, therefore, that the defendant is entitled to recover in this action of the
plaintiff the sum of P5,213.54, that being the difference between the balance
remaining due from plaintiff to the defendant on the purchase price of said
machinery, viz, P10,199.35, and the aggregate amount of the damages herein
allowed to the plaintiff by reason of the breach of said contract by the defendant,
as aforesaid, viz, P4,985.81, with interest on said P5,213.54 at the rate of 6 per
cent per annum from February 28, 1907, and he is hereby given judgment for that
amount.
The judgment of the lower court is, therefore, modified to the extent and in the
particulars above enumerated, and, as modified, affirmed, with costs against the
defendant.
LlM SIENGCO, plaintiff and appellant, vs. Lo SENG, doing business under the
style of Lo Seng & Co., defendant and appellant. | G.R. No. L-20923, EN BANC,
February 25, 1924, STREET, J.
FACTS:
The present action was instituted in the Court of First Instance of Manila by Lim
Siengco to recover of Lo Seng, upon the first cause of action stated in the
complaint, the sum of P15,282.28, consisting partly of money advanced by the
plaintiff to the defendant and partly of a claim for damages for breach of the
contracts for the purchase of alcohol, and in his second cause of action the sum of
P818, the value of wine and demijohns alleged to have been sold and delivered to
the defendant.
July, 1919, the defendant, Lo Seng, was doing business as a distiller of alcohol,
under the name of Lo Seng & Co, while plaintiff, Lim Siengco was a merchant.
Lo Seng as manager of Lo Seng & Co., contracted in writing to sell to Lim Siengco
1,000 arrobas of refined alcohol, 182 proof, at the price of P7 per arroba. The first
delivery was stipulated to be made on August 15, 1919, with weekly deliveries of
150 arrobas of said alcohol until delivery should be completed.
On the same day Lo Seng contracted in writing to sell to the same Lim Siengco
6,000 arrobas of crude alcohol, of 80 proof, at the price of P3 per arroba.
Deliveries under this contract should be made at the rate of P1,000 arrobas
commencing July 30 and at intervals of about fifteen days. In connection with this
contract for the sale of the crude alcohol Lim Siengco advanced the sum of P1,500
at the time of the making of the contract, and another sum of P1,500 on July 24,
thereafter. A little later Lim Siengco delivered another P1,000, making P4,000 in
all advanced by the plaintiff upon this contract.
Some time after these contracts were made, Lo Seng & Co. delivered about 128
arrobas of fine alcohol and about 468 arrobas of crude alcohol, after which no
deliveries whatever were made upon the contract.
The manager of the plaintiff, one Lim Chiu, called upon the manager of Lo Seng,
one Simonson, and made inquiry as to the reason for the failure of Lo Seng & Co.
to make deliveries of the alcohol as agreed. Simonson made the following excuses
regarding the deliveries:
a. a typhoon had lately prevailed in the province where the
distillery was located and that on this account the distillery
had not been operated lately with efficiency;
b. condition of market for alcohol, the price of which began to
rise in August and September and which continued to
progress upwards for several months, until fine alcohol was
sold for P12 or P15 and crude alcohol for nearly P4.
ISSUE/S:
Whether or not damages should be awarded for breach of contract.
RULING:
Whether or not damages should be awarded for breach of contract
The plaintiff's manager prepared an exhibit on January 31, 1920, in which he
stated the damages as representing the difference between the price stipulated
in the contract and the price of fine and crude alcohol in the market on the date
the account was stated. This mode of stating the damages resulting to the plaintiff
is incorrect, the true measure of damages being the difference between the
contract price and the price prevailing in the market at the stipulated time and
place of delivery.
If the plaintiff had been compelled to buy alcohol like that contracted for from
some other person than the defendant, this would have been competent proof on
the question of damages, if the purchase was effected at a higher price than that
stipulated in the contract with the defendant. But the right of the plaintiff to
recover damages was not absolutely dependent upon proof of this character. As
already stated the correct measure of damages is to be found in the difference
between the contract price and the price prevailing in the market at the time and
place stipulated for the deliveries.
The court note that a competent witness, Mr. A. B. Powell, was examined with
reference to the prices prevailing in Manila for crude and fine alcohol of the
quantity contracted for during the period from July to December, 1919. Taking
the prices stated by him as approximately true, and estimating the prices of the
crude and fine alcohol at the times and in the amounts stipulated for delivery, the
court estimate roughly that there was a loss to the plaintiff of about P4,610, by
reason of the failure of the defendant to make deliveries upon his contracts at the
times agreed. Summing up the three items above specified and deducting
therefrom the amount of P909.84, which represents, according to Simonson, the
value of a delivery of alcohol, which the plaintiff did not pay for, the court ruled
that the sum of P6,000 is proper to be allowed the plaintiff upon the two causes
of action set forth in the complaint.
DISPOSITIVE PORTION:
For the reasons stated, the action of the trial judge in absolving the defendant
from the plaintiff's complaint will be reversed; and the plaintiff will recover of
the defendant the sum of P6,000, with interest at 6 per cent from November 13,
1919. The action of the trial court in absolving the plaintiff from the counterclaim
will be affirmed. No special pronouncement will be made as to costs. So ordered.
- SAB
ENDREO MAGBANUA, VALLACAR TRANSIT, INC., and its Present Corporate
Official RICARDO YANSON, Petitioners, v. JOSE TABUSARES, JR., EVA T.
LAFIGUERA, NONA C. TABUSARES, JUN C. TABUSARES, FE C. TABUSARES
and JAX C. TABUSARES, Respondents.
G.R. NO. 152134, SECOND DIVISION, June 4, 2004, PUNO, J.
FACTS:
A Ceres Liner Bus driven by Endreo Magbanua and owned and operated by
Vallacar Transit, Inc. and an Amante Type jeepney driven by Felipe Palacios and
owned by Salvador Algara, Sr. figured in a vehicular accident. The bus bumped
the rear portion of the Jeepney while both vehicles were running downhill on the
same direction.
The bus was trying to overtake the jeepney which was overloaded with 35
passengers and the bus driver said that he did not apply his brakes because he
cannot overtake if he will slow down. Due to the impact, several passengers of
the Jeepney were thrown out and ran over by the Bus and died as a result of the
injuries they sustained. One of those killed was Jury Tabusares, 27 years of age,
single, an employee of the Maricalum Copper Mines as Oiler 2B and was then
receiving ₱1,256.00 monthly salary plus ₱510.00 cost of living allowance (COLA)
or a total monthly income of ₱1,766.00.
Hence a compliant for damages was filed by the parents of Jury Tabusares.
The trial court found that the negligent acts of the drivers of both the jeepney and
the Ceres Liner Bus combined in directly causing the death of Jury Tabusares. The
CA affirmed the factual findings of the trial court, but modified the award of
damages.
Petitioners filed a partial motion for reconsideration of the decision of the Court
of Appeals, praying for a reduction of the amount of damages for loss of earning
capacity. The Court of Appeals denied the motion. Hence, this petition.
Petitioners argue that the instant case was decided by the Court of Appeals one
year and six months after the promulgation of People v. Muyco, therefore,
the Court should apply the computation in the latter case.
ISSUE: Whether or Not the CA correctly applied the formula used in People vs.
Lopez in the computation of the award of damages for loss of earning capacity
instead of the formula used in People vs. Muyco, et al.
HELD:
NO, the CA did not err.
In People v. Lopez, the Court applied the following formula:
2/3 x (80-27) xP21,192.00 50%
However, the following formula was employed in People v. Muyco, et al:
2/3 x (80 27) x P21,192.00 80%
The difference lies in the computation of the net income of the victim.In the Lopez
case, net income was derived by deducting 50% of the gross annual income, while
in the Muyco case, the amount deducted was 80% of the gross annual income.The
Court of Appeals followed the computation in People v. Lopez as it was the
prevailing case law at the time of the decision appealed from was promulgated
and unmistakably more favorable to the heirs of the deceased. Petitioners argue
that the instant case was decided by the Court of Appeals one year and six months
after the promulgation of People v. Muyco, therefore, the Court should apply the
computation in the latter case.
On the other hand, the respondents, in their comment, cite other cases decided
after the Muyco case where the Court applied the formula in the Lopez case.They
submit that the computation in People v. Lopez should be applied in this case.
Article 2205 of the New Civil Code allows the recovery of damages for "loss or
impairment of earning capacity in cases of temporary or permanent personal
injury." Such damages covers the loss sustained by the dependents or heirs of
the deceased, consisting of the support they would have received from him had
he not died because of the negligent act of another. The loss is not equivalent to
the entire earnings of the deceased, but only that portion that he would have
used to support his dependents or heirs. Hence, we deduct from his gross
earnings the necessary expenses supposed to be used by the deceased for his
own needs.
Thus, the formula for the computation of unearned income is:
Net Earning Capacity = life expectancy x gross annual income
less living expenses
Life expectancy is determined in accordance with the formula:
2/3 x [80 – age of deceased]
A survey of more recent jurisprudence shows that the Court consistently pegged
the amount at 50% of the gross annual income. We held in Smith Bell Dodwell
Shipping Agency Corp. v. Borja that when there is no showing that the living
expenses constituted a smaller percentage of the gross income, we fix the living
expenses at half of the gross income, thus:
In other words, only net earnings, not gross earnings, are to be considered; that
is, the total of the earnings less expenses necessary in the creation of such
earnings or income, less living and other incidental expenses.When there is no
showing that the living expenses constituted a smaller percentage of the
gross income, we fix the living expenses at half of the gross income.To hold
that one would have used only a small part of the income, with the larger
part going to the support of ones children, would be conjectural and
unreasonable.
There is no evidence in the case at bar whether the living expenses of the victim,
Jury Tabusares, constituted a bigger or smaller percentage of his gross income.In
such case, it is fair to assume that it is 50% of his gross annual income.Hence, we
find that the Court of Appeals did not err in its computation of the award of loss
of unearned income to petitioner.
-Rochelle
VICTORY LINER, INC., Petitioner, v. ROSALITO GAMMAD, APRIL ROSSAN P.
GAMMAD, ROI ROZANO P. GAMMAD and DIANA FRANCES P. GAMMAD,
Respondents.
[G.R. NO. 159636 : November 25, 2004]
FACTS:
In 1996, Rosalito Gammad’s wife, Marie Grace, was on board an air-conditioned
Victory Liner bus bound for Tuguegarao, Cagayan from Manila. While running at
a high speed, the bus fell on a ravine in Nueva Vizcaya, which resulted in the death
of Marie Grace and physical injuries to other passengers.
The heirs of the deceased (respondents) filed a complaint for damages arising
from culpa contractual against Victory Liner. The latter claimed that the incident
was purely accidental and that it has always exercised extraordinary diligence in
its 50 years of operation.
At the pre-trial, Victory Liner did not want to admit the proposed stipulation that
the deceased was a passenger of the Victory Liner Bus which fell on the ravine
and that she was issued Passenger Ticket No. 977785. Respondents, for their
part, did not accept petitioner's proposal to pay P50,000.00.
The RTC rendered its decision in favor of respondents, ordering Victory Liner to
pay the following:
1. Actual Damages - - - - - - - - - - - - - - - - - - - - P 122,000.00
2. Death Indemnity - - - - - - - - - - - - - - - - - - - - - 50,000.00
3. Exemplary and Moral Damages - - - - - 400,000.00
4. Compensatory Damages - - - - - - - - - - 1,500,000.00
5. Attorney's Fees - - - - - - - - - - - - - - - - - - - - - 10% of the total amount
granted
6. Cost of the Suit.
The CA affirmed the decision of the trial court with modification as follows:
1. Actual Damages in the amount of P88,270.00;
2. Compensatory Damages in the amount of P1,135,536,10;
3. Moral and Exemplary Damages in the amount of P400,000.00; and
4. Attorney's fees equivalent to 10% of the sum of the actual,
compensatory, moral, and exemplary damages herein adjudged.
Represented by a new counsel, Victory Liner filed a motion for reconsideration
praying that the case be remanded to the trial court for cross-examination of
respondents' witness and for the presentation of its evidence. It argued that the
decision should be set aside because the negligence of its former counsel, Atty.
Antonio B. Paguirigan, in failing to appear at the scheduled hearings and move
for reconsideration of the orders declaring petitioner to have waived the right to
cross-examine respondents' witness and right to present evidence, deprived
petitioner of its day in court. Denied.
Hence, this Petition for Review principally based on the fact that the mistake or
gross negligence of its counsel deprived petitioner of due process of law.
Petitioner also argues that the trial court's award of damages were without basis
and should be deleted.
ISSUES:
(1) whether petitioner should be held liable for breach of contract of
carriage; and (main topic)
(2) whether the award of damages was proper
RULING:
RE: WON petitioner's counsel was guilty of gross negligence (not related to
torts), the court ruled in the negative. To sustain petitioner's argument that it
was denied due process of law due to negligence of its counsel would set a
dangerous precedent. It would enable every party to render inutile any adverse
order or decision through the simple expedient of alleging gross negligence on
the part of its counsel. The Court will not countenance such a farce which
contradicts long-settled doctrines of trial and procedure.
1. Victory Liner was correctly found liable for breach of contract of carriage.
A common carrier is bound to carry its passengers safely as far as human care
and foresight can provide, using the utmost diligence of very cautious persons,
with due regard to all the circumstances. In a contract of carriage, it is presumed
that the common carrier was at fault or was negligent when a passenger dies or
is injured. Unless the presumption is rebutted, the court need not even make an
express finding of fault or negligence on the part of the common carrier. This
statutory presumption may only be overcome by evidence that the carrier
exercised extraordinary diligence.
In the instant case, there is no evidence to rebut the statutory presumption that
the proximate cause of Marie Grace's death was the negligence of petitioner.
Hence, the courts below correctly ruled that petitioner was guilty of breach of
contract of carriage.
2. Nevertheless, the award of damages should be modified.
Article 1764 in relation to Article 2206 of the Civil Code, holds the common
carrier in breach of its contract of carriage that results in the death of a passenger
liable to pay the following: (1) indemnity for death, (2) indemnity for loss of
earning capacity, and (3) moral damages.
In the present case, respondent heirs of the deceased are entitled to indemnity
for the death of Marie Grace which under current jurisprudence is fixed at
P50,000.00.
The award of compensatory damages for the loss of the deceased's earning
capacity should be deleted for lack of basis. As a rule, documentary evidence
should be presented to substantiate the claim for damages for loss of earning
capacity. By way of exception, damages for loss of earning capacity may be
awarded despite the absence of documentary evidence when (1) the deceased is
self-employed earning less than the minimum wage under current labor laws,
and judicial notice may be taken of the fact that in the deceased's line of work no
documentary evidence is available; or (2) the deceased is employed as a daily
wage worker earning less than the minimum wage under current labor laws.
In People v. Oco, the Court held that testimonial evidence alone is insufficient to
justify an award for loss of earning capacity. Likewise, in People v. Caraig,
damages for loss of earning capacity was not awarded because the circumstances
of the 3 deceased did not fall within the recognized exceptions, and except for the
testimony of their wives, no documentary proof about their income was
presented by the prosecution.
Here, the trial court and the Court of Appeals computed the award of
compensatory damages for loss of earning capacity only on the basis of the
testimony of respondent Rosalito that the deceased was 39 years of age and a
Section Chief of the BIR, Tuguergarao District Office with a salary of P83,088.00
per annum when she died. No other evidence was presented. The award is clearly
erroneous because the deceased's earnings does not fall within the exceptions.
However, the fact of loss having been established, temperate damages in the
amount of P500,000.00 should be awarded to respondents. Under Article 2224
of the Civil Code, temperate or moderate damages, which are more than nominal
but less than compensatory damages, may be recovered when the court finds that
some pecuniary loss has been suffered but its amount cannot, from the nature of
the case, be proved with certainty.
In Pleno v. Court of Appeals, the Court sustained the trial court's award of
P200,000.00 as temperate damages in lieu of actual damages for loss of earning
capacity because the income of the victim was not sufficiently proven.
The SC ruled that the lower court's awards of damages are more consonant with
the factual circumstances of the instant case. The trial court's findings of facts are
clear and well-developed. Each item of damages is adequately supported by
evidence on record.
Anent the award of moral damages, the same cannot be lumped with
exemplary damages because they are based on different jural foundations.
These damages are different in nature and require separate determination. In
culpa contractual or breach of contract, moral damages may be recovered when
the defendant acted in bad faith or was guilty of gross negligence (amounting to
bad faith) or in wanton disregard of contractual obligations and, as in this case,
when the act of breach of contract itself constitutes the tort that results in
physical injuries. By special rule in Article 1764 in relation to Article 2206 of the
Civil Code, moral damages may also be awarded in case the death of a passenger
results from a breach of carriage. On the other hand, exemplary damages, which
are awarded by way of example or correction for the public good may be
recovered in contractual obligations if the defendant acted in wanton, fraudulent,
reckless, oppressive, or malevolent manner.
Respondents in the instant case should be awarded moral damages to
compensate for the grief caused by the death of the deceased resulting from
the petitioner's breach of contract of carriage. Furthermore, the petitioner
failed to prove that it exercised the extraordinary diligence required for common
carriers, it is presumed to have acted recklessly. Thus, the award of exemplary
damages is proper. Under the circumstances, we find it reasonable to award
respondents the amount of P100,000.00 as moral damages and P100,000.00 as
exemplary damages. These amounts are not excessive.
The actual damages awarded by the trial court reduced by the Court of
Appeals should be further reduced. A list of expenses, and the contract/receipt
for the construction of the tomb in this case, cannot be considered competent
proof and cannot replace the official receipts necessary to justify the award.
Hence, actual damages should be further reduced to P78,160.00, which was the
amount supported by official receipts.
Pursuant to Article 2208 of the Civil Code, attorney's fees may also be recovered
in the case at bar where exemplary damages are awarded. The Court finds the
award of attorney's fees equivalent to 10% of the total amount adjudged
against petitioner reasonable.
Finally, in Eastern Shipping Lines, Inc. v. Court of Appeals, it was held that when
an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts
or quasi-delicts is breached, the contravenor can be held liable for payment of
interest in the concept of actual and compensatory damages.
In the instant case, petitioner should be held liable for payment of interest as
damages for breach of contract of carriage. Considering that the amounts payable
by petitioner has been determined with certainty only in the instant petition, the
interest due shall be computed upon the finality of this decision at the rate of 12%
per annum until satisfaction.
2. In crimes and quasi-delicts
G. What is the “Abrazaldo Doctrine”
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs.
FEDERICO ABRAZALDO @ "PEDING," accused-appellant.
G.R. No. 124392 February 7, 2003 SANDOVAL-GUTIERREZ, J.
FACTS:
On July 15, 1995, accused-appellant, then intoxicated, attempted to hack
his uncle, Bernabe Quinto, but instead, hit the post of the latter’s house. The
incident was reported to the barangay authorities, prompting Delfin Guban,
Rosendo Fajardo, Sr., Alejandro Loceste (all are members of the barangay tanod),
and Cesar Manaois to rush to the scene. Upon reaching the place, Fajardo heard
accused-appellant shouting at his uncle, "I will kill you!" Thereafter, he saw
accused-appellant coming out of Quinto’s house with blood oozing from his
forehead. At that time, the place was well lighted by a flourescent lamp. Guban
tried to assist accused-appellant. However, for unknown reason, accused-
apellant and Guban shouted at each other and grappled "face to face." Accused-
appellant pulled out his knife, stabbed Guban at the abdomen and ran away.
When Fajardo got hold of Guban, the latter said, "I was stabbed by Feding
Abrazaldo." Fajardo, together with the other barangay tanod, rushed Guban to
the Gov. Teofilo Sison Memorial Hospital where he was operated by Dr. Alberto
Gonzales, a Medical Officer III. But after a few hours, Guban died. Dr. Gonzales
issued a Medico-Legal Certificate stating that the cause of death was "stab wound,
epigastrium, massive hemothorax right."
Gregorio Guban, the victim’s father, testified that he was the one who spent for
his son’s funeral expenses. For the burial, he spent ₱10,000.00; for the 10-day
funeral wake, ₱10,000.00; for the 9th day novena, ₱3,000.00; and for the
hospitalization, ₱4,000.00, or a total of ₱27,000.00.
Invoking self-defense, accused-appellant presented a different version.
On July 15, 1995 at about 10:00 in the evening, he was making fans inside his
house at Barangay Pogo, Mangaldan, Pangasinan. His wife Lydia and children
Mary Jane, Melvin and Christelle were with him. Suddenly, Delfin Guban, who was
then drunk, went to his house and shouted at him, saying, "Get out Feding I will
kill you!" When accused-appellant went out, Guban hit him with an iron pipe.
Accused-appellant ran towards his house and got his two children. Guban, now
armed with a knife, followed him and they grappled for its possession. In the
course thereof, both fell down. It was then that the knife held by Guban
accidentally hit him. Accused-appellant did not know which part of Guban’s body
was hit. Thereafter, he got the knife in order to surrender it to the police.
Marites Abrazaldo testified that accused-appellant is his brother. On July 15,
1992, at about 6:00 in the evening, accused-appellant, Guban and Juan Quinto
were engaged in a "drinking spree. At about 10:00 o’clock in that evening,
accused-appellant caused trouble at the house of his uncle, Bernabe Quinto. He
attempted to hack his uncle, but instead hit the post of the latter’s house. While
running away from his uncle’s place, he bumped an artesian well, causing a
wound on his forehead. Afterwards, accused-appellant killed Guban.
On November 15, 1995, the trial court rendered a Decision, finding accused
Federico Abrazaldo Peding guilty beyond reasonable doubt of the crime of
Murder. Accused Federico Abrazaldo is ordered to pay an indemnity of
₱50,000.00 to the heirs of the deceased Delfin Guban. Accused is also ordered to
pay the heirs of the deceased Delfin Guban the total sum of ₱27,000.00 as actual
expenses, plus costs. In appreciating treachery and the aggravating
circumstances under paragraphs (5) and (6) of Article 14, 25 Revised Penal Code,
the trial court held: "We now come to the issue of whether or not evident
premeditation was present. The prosecution’s evidence is wanting on this point.
However, there is no question that there was treachery as the accused
embraced Delfin Guban and suddenly stabbed him with a knife. The victim
was not in a position to defend himself at the time of the attack. The
deceased was stabbed without any warning. He was given no chance to
defend himself. Treachery, therefore, qualifies the killing of the victim and
raises it to the category of murder.
"The prosecution has established thru the testimony of Gregorio Guban that at
the time of the incident on July 15, 1995, the members of the barangay tanod,
namely: Rosendo Fajardo, Sr., Delfin Guban and Alfredo Laceste were performing
their duties as members of the barangay tanod. This is an aggravating
circumstance under paragraph 5, Article 14 of the Revised Penal Code. The
members of the barangay tanod who are public authorities were engaged
in the discharge of their duties at the time of the stabbing incident. Besides,
the incident was committed during nighttime, that was 10:00 in the evening.
Accused took advantage of the darkness of the night for the successful
consummation of his plan to kill Delfin Guban."
ISSUES:
1. Whether or not accused Abrazaldo acted in self-defense?
2. Whether or not there was treachery in the killing of Delfin
Guban?
3. Whether or not there was an aggravating circumstance of
nighttime?
4. Whether or not the trial court correctly awarded the damages?
(TORTS & DAMAGES ISSUE)
RULING:
1. NO. Consistent is the jurisprudence that where self-defense is invoked, it is
incumbent upon the accused to prove by clear and convincing evidence that (1)
he is not the unlawful aggressor; (2) there was lack of sufficient provocation on
his part; and (3) he employed reasonable means to prevent and repel an
aggression. On appeal, the burden becomes even more difficult as the accused
must show that the court below committed reversible error in appreciating the
evidence.
Accused-appellant miserably failed to discharge the burden. To show that he was
not the unlawful aggressor, he testified that it was Guban who went to his house,
threatened to kill him,27 hit him with an iron pipe,28 and attacked him with a knife.
It is uncorroborated and even opposed by Marites, accused-appellant’s own
sister and lone witness. Contrary to his testimony that Guban hit him on his
forehead with a pipe, Marites declared that accused-appellant sustained the
wound on his forehead when he accidentally bumped an artesian well. Instead of
fortifying her brother’s defense, she virtually affirmed the prosecution’s story by
testifying that he created trouble in their compound, attempted to kill his uncle
Bernabe Quinto and killed Guban.
Ingrained in our jurisprudence is the doctrine that the plea of self-defense cannot
be justifiably entertained where it is not only uncorroborated by any separate
competent evidence but in itself is extremely doubtful. In the present case,
accused-appellant’s tendency to invoke a melange of defenses renders his
testimony dubious. While he admitted the commission of the crime in order to
preserve his own life, he maintained that Guban accidentally stabbed himself.
This shows ambivalence. Accident presupposes lack of intention to stab the
victim, while self-defense presumes voluntariness, induced only by necessity.
Indeed, if there is truth to either of his claim, his natural course of action was to
assist the victim, or at the very least, report the incident to the authorities.
Certainly, the justifying circumstance of self-defense or the exempting
circumstance of accident cannot be appreciated considering accused-appellant’s
flight from the crime scene and his failure to inform the authorities of the
incident. Furthermore, that he did not surrender the knife to the authorities is
inconsistent with a clean conscience and, instead, indicates his culpability of the
crime charged.
2. NO. We find that the trial court erred in concluding that treachery attended
the commission of the crime. There is treachery when the offender commits any
of the crimes against persons employing means, methods or forms in the
execution thereof, which tend directly and specially to insure its execution,
without risk to himself arising from defense which the offended party might
make. Treachery cannot be presumed, it must be proved by clear and convincing
evidence or as conclusively as the killing itself. Fajardo testified that accused-
appellant and Guban were "grappling with each other" and that prior to the
stabbing, they were shouting at each other. In this scenario, it cannot be said that
Guban was unprepared to put up a defense, such as hitting accused-appellant, or
that the latter’s assault was sudden.
3. NO. The trial court likewise erred in appreciating the aggravating
circumstance of nocturnity or nighttime. For nocturnity to be properly
appreciated, it must be shown that it facilitated the commission of the crime and
that it was purposely sought for by the offender. By and itself, nighttime is not an
aggravating circumstance.41 In the instant case, no sufficient evidence was offered
to prove that accused-appellant deliberately sought the cover of darkness to
accomplish his criminal design. In fact, Fajardo testified that there was a
fluorescent lamp sufficiently illuminating the scene of the crime. Neither can we
sustain the trial court’s finding that the aggravating circumstance under
paragraph (5) of Article 14, Revised Penal Code, i.e., that the crime was
committed in a place where public authorities were engaged in the discharge of
their duties, is present. It must be pointed out that this aggravating circumstance
is based on the greater perversity of the offender, as shown by the place of the
commission of the crime, which must be respected.43 In this case, the crime was
committed at the compound of the accused-appellant where no public function
was being held. The arrival of the barangay authorities was precisely due to the
trouble that had commenced prior to the stabbing incident. Clearly, the said
aggravating circumstance cannot be considered. Moreover, under the present
Rules, aggravating circumstances must be alleged, otherwise, they cannot be
appreciated. Being favorable to the accused, this new procedure may be given
retroactive effect. Except treachery, the other aggravating circumstances
mentioned have not been alleged in the Information. Accused-appellant can only
be held liable for homicide defined and penalized under Article 249 of the
Revised Penal Code.
4. On the trial court’s award of actual damages in the amount of ₱27,000.00,
we find the same to be unsubstantiated. To be entitled to such damages, it is
necessary to prove the actual amount of loss with a reasonable degree of
certainty, premised upon competent proof and on the best evidence obtainable
to the injured party. In the case at bar, the prosecution failed to present any
receipt to prove the claim for expenses incurred. Gregorio Guban, the father of
the victim, who shouldered the expenses for the wake and burial failed to submit
receipts to show the amount of such expenses. However, as the heirs of Guban
did actually incur funeral expenses, we are justified in awarding ₱25,000.00, not
for purposes of indemnification, but by way of temperate damages.
Thus, we now hold that where the amount of the actual damages cannot be
determined because of the absence of receipts to prove the same, but it is shown
that the heirs are entitled thereto, temperate damages may be awarded. Such
temperate damages, taking into account the current jurisprudence fixing the
indemnity for death at ₱ 50,000.00, should be one-half thereof, or ₱25,000.00.
This makes temperate damages equal to the award of exemplary damages, which
is likewise fixed at ₱25,000.00 in cases where its award is justified
H. Standards in the award of damages in criminal cases
People vs. Credo
PEOPLE OF THE PHILIPPINES v. RONALD CREDO AKA “ONTOG,” RANDY
CREDO AND ROLANDO CREDO Y SAN BUENAVENTURA
G.R. No. 197360, July 03, 2013, PEREZ, J.
FACTS:
The amended Information filed against appellants read:
That on June 22, 2005 at around 10:30 in the evening at Zone 4 Barangay San
JOSE, Municipality of Pili, Province of Camarines Sur, Philippines and within the
jurisdiction of this Honorable Court, Roland Credo, Randy Credo, and Rolando
Credo, conspiring, confederating and mutually helping one another, did then and
there, with intent to take the life of JOSEPH NICOLAS Y arroyo, willfully,
unlawfully and feloniously attack and hack the latter with a bolo, wounding him
in the different parts of the body, per autopsy report hereof, thereby causing the
direct and immediate death of said JOSEPH NICOLAS y ARROYO.
Abuse of superior strength being attendant in the commission of the crime, the
same will qualify the offense committed to murder.
The trial court found that appellants conspired in the commission of the crime
and that the killing of Joseph was attended by abuse of superior strength. Hence,
on 14 July 2009, the trial court rendered its decision finding appellants guilty
beyond reasonable doubt of the crime of murder, sentencing them to suffer the
penalty of reclusion perpetua, and ordering them:
1) to pay the widow of Joseph the amounts of P14,000.00 as
actual damages
2) P50,000.00 as civil indemnity
3) P50,000.00 as moral damages, and
4) P50,000.00 as exemplary damages.
On appeal, the Court of Appeals affirmed the judgment of conviction but
modified the award of damages in the following manner:
1) civil indemnity was increased from P50,000.00 to
P75,000.00;
2) the award of moral damages was likewise increased from
P50,000.00 to P75,000.00;
3) the amount of exemplary damages was reduced from
P50,000.00 to P30,000.00; and
4) temperate damages in the amount of P25,000.00 was
imposed in place of actual damages.
ISSUE: Whether or not the CA gravely erred in the award of damages
RULING:
Qualified.
CA was correct in increasing award of civil indemnity from
P50,000.00 to P75,000.00.
CA erred when it increased the amount of moral damages from
P50,000.00 to P75,000.00.
CA correctly reduced the amount from P50,000.00 to P30,000.00.
CA correctly held that, since the receipted expenses of Joseph’s
family amounted to only P14,300.00, temperate damages in the
amount of P25,000.00 in lieu of actual damages should be awarded.
In People v. Anticamara, this Court laid down the standards in the proper award
of damages in criminal cases, as
…the award of civil indemnity is mandatory and granted to the heirs of
the victim without need of proof other than the commission of the crime.
In People v. Quiachon, the Court held that even if the penalty of
death is not to be imposed because of the prohibition in R.A. 9346,
the civil indemnity of P75,000.00 is proper, because it is not
dependent on the actual imposition of the death penalty but on the
fact that qualifying circumstances warranting the imposition of the
death penalty attended the commission of the offense. As explained
in People v. Salome, while R.A. No. 9346 prohibits the imposition of the
death penalty, the fact remains that the penalty provided for by law for
a heinous offense is still death, and the offense is still heinous.
Accordingly, the award of civil indemnity in the amount of P75,000.00 is
proper.
Anent moral damages, the same are mandatory in cases of murder,
without need of allegation and proof other than the death of the victim.
However, consistent with recent jurisprudence on heinous crimes
where the imposable penalty is death but reduced to reclusion
perpetua pursuant to R.A. No. 9346, the award of moral damages
should be decreased from P50,000.00 to P75,000.00.
Accordingly, the Court of Appeals was correct in increasing the lower court’s
award of civil indemnity from P50,000.00 to P75,000.00. Regardless of the
penalty imposed by the trial court, the correct amount of civil indemnity is
P75,000.00, pursuant to the ratiocination of the Court in the above-cited case of
People v. Anticamara.
The Court of Appeals, however, erred when it increased the amount of
moral damages from P50,000.00 to P75,000.00. In accordance with the
pronouncement of the Court in the Anticamara Case, the correct sum should be
P50,000.00.
In connection with the award of exemplary damages, the Court of Appeals
correctly reduced the amount from P50,000.00 to P30,000.00 in line with
current jurisprudence.
Finally, pursuant to the ruling of the Court in People v. Villanueva,“ when actual
damages proven by receipts during the trial amount to less than P25,000, as in
this case, the award of temperate damages for P25,000 is justified in lieu of actual
damages of a lesser amount. Conversely, if the amount of actual damages proven
exceeds P25,000, then temperate damages may no longer be awarded; actual
damages based on the receipts presented during trial should instead be granted.”
As a result, the Court of Appeals likewise correctly held that, since the
receipted expenses of Joseph’s family amounted to only P14,300.00,
temperate damages in the amount of P25,000.00 in lieu of actual damages
should be awarded.
Dispositive Portion:
WHEREFORE, the appeal is hereby DENIED. The Decision of the Court of Appeals
dated 28 February 2011 in CA-G.R. CR-HC No. 04113, finding appellants Ronald,
Randy and Rolando, all surnamed Credo, guilty beyond reasonable doubt of
murder is AFFIRMED with the MODIFICATION that the award of moral damages
is reduced from P75,000.00 to P50,000.00. The appeal with respect to the
deceased appellant Rolando Credo is DISMISSED. SO ORDERED.
CHAPTER III: Moral Damages
A. Concept, Basis and Scope (Arts. 2217 to 2219, New Civil Code)
MANILA DOCTORS HOSPITAL, v. SO UN CHUA and VICKY TY,
G.R. NO. 150355, July 31, 2006, AUSTRIA-MARTINEZ, J.:
FACTS:
On December 13, 1993, respondents filed a Complaint averring that on October
30, 1990, respondent Chua, the mother of respondent Vicky Ty, was admitted in
petitioner's hospital for hypertension and diabetes; that while respondent Chua
was confined, Judith Chua, the sister of respondent Ty, had been likewise
confined for injuries suffered in a vehicular accident; that partial payments of the
hospital bills were made, totaling P435,800.00; that after the discharge of Judith
Chua, respondent Chua remained in confinement and the hospital bills for both
patients accumulated; that respondent Chua was pressured by the petitioner,
through its Credit and Collection Department, to settle the unpaid bills; that
respondent Ty represented that she will settle the bills as soon as the funds
become available; that respondent Ty pleaded to the management that in view of
the physical condition of her mother, respondent Chua, the correspondences
relating to the settlement of the unpaid hospital bills should be relayed to the
former; that these pleas were unheeded by the petitioner; that petitioner
threatened to implement unpleasant measures unless respondent Ty undertakes
her mother's obligation as well as the obligation of her sister, Judith Chua, to pay
the hospitalization expenses; that petitioner made good its threat and employed
unethical, unpleasant and unlawful methods which allegedly worsened the
condition of respondent Chua, particularly, by (i) cutting off the telephone line in
her room and removing the air-conditioning unit, television set, and refrigerator,
(ii) refusing to render medical attendance and to change the hospital gown and
bed sheets, and (iii) barring the private nurses or midwives from assisting the
patient. Respondents thus prayed for the award of moral damages, exemplary
damages, and attorney's fees.
Petitioner specifically denied the material averments of the Complaint and Reply,
and interposed its counterclaims arguing that as early as one week after
respondent Chua had been admitted to its hospital, Dr. Rody Sy, her attending
physician, had already given instructions for her to be discharged, but
respondents insisted that Chua remain in confinement; that, through its staff,
petitioner accordingly administered medical examinations, all of which yielded
negative results; that respondent Ty voluntarily undertook, jointly and severally,
to pay the hospital bills for both patients; that although respondent Ty paid up to
P435,000.00, more or less, she reneged on her commitment to pay the balance in
violation of the Contract for Admission and Acknowledgment of Responsibility
for Payment dated October 30, 1990 which she voluntarily executed; that she
signed a Promissory Note on June 5, 1992 for the unpaid balance of
P1,075,592.95 and issued postdated checks to cover the same; that no such
undue pressure had been imposed upon respondent Chua to settle the bills, the
truth being that, as a matter of standard procedure, the reminders to settle the
bills were transmitted not to the patients but to their relatives who usually
undertook to pay the same; that respondent Ty deliberately evaded the staff of
the Credit and Collection Department; that the cutting-off of the telephone line
and removal of the air-conditioning unit, television set, and refrigerator cannot
constitute unwarranted actuations, for the same were resorted to as cost-cutting
measures and to minimize respondents' charges that were already piling up,
especially after respondent Ty refused to settle the balance notwithstanding
frequent demands; that respondent Ty evaded the staff when the latter
attempted to inform her that the room facilities will be cut off to minimize the
rising charges; and that respondents instituted the present civil case purposely
as leverage against the petitioner after the latter had filed criminal charges for
violation of Batas Pambansa (B.P.) Blg. 22 against respondent Ty for issuing
checks, later dishonored, totaling P1,075,592.95, the amount referring to the
unpaid hospital bills. In its compulsory counterclaim, petitioner prayed, among
other items, for the award of no less than P1,000,000.00 as compensatory
damages due to the filing of a malicious and unfounded suit, and, in its permissive
counterclaim, petitioner prayed for respondents to pay P1,075,592.95, the
amount representing the due and demandable obligation under the Promissory
Note dated June 5, 1992, including the stipulated interest therein and the 25
percent of the total amount due as attorney's fees.
RTC rendered its Decision in favor of the respondents.
The Court of Appeals affirmed the appealed decision with the modification that
the award of moral damages, exemplary damages as well as attorney's fees is
reduced to Seventy Five Thousand Pesos (P75,000.00), Thirty Thousand Pesos
(P30,000.00) and Twenty Thousand Pesos (P20,000.00), respectively.
ISSUE:
Whether the actuations of the petitioner amount to actionable wrongs (NO)
RULING:
The courts a quo concluded that the actuations of the petitioner were oppressive,
unnecessary, and anti-social, done in bad faith without proper notice, with no
intention other than to harass or irritate the respondents, all of which constitute
an abuse of rights. We do not agree. The conclusions of the courts a quo are either
haphazard conjectures, or founded on a misapprehension of facts. The record is
replete with evidence that justifies a different conclusion.
Indeed the operation of private pay hospitals and medical clinics is impressed
with public interest and imbued with a heavy social responsibility. But the
hospital is also a business, and, as a business, it has a right to institute all
measures of efficiency commensurate to the ends for which it is designed,
especially to ensure its economic viability and survival. For the moment, the
question to be considered is whether the subject facilities are indeed non-
essential - the air-conditioner, telephone, television, and refrigerator - the
removal of which would cause the adverse health effects and emotional trauma
the respondents so claimed. Corollary to this question is whether the petitioner
observed the diligence of a good father of the family in the course of ascertaining
the possible repercussions of the removal of the facilities prior to the removal
itself and for a reasonable time thereafter, with a view to prevent damage.
After an extensive analysis of the record, it becomes rather worrisome to this
Court that the courts a quo unreservedly drew their conclusions from the self-
serving and uncorroborated testimonies of the respondents the probative value
of which is highly questionable. We hold that the respondents failed to prove the
damages so claimed.
The evidence in the record firmly establishes that the staff of the petitioner took
proactive steps to inform the relatives of respondent Chua of the removal of
facilities prior thereto, and to carry out the necessary precautionary measures to
ensure that her health and well-being would not be adversely affected.
It is also undisputed that the hospital administrator, Sister Galeno, prior to the
removal of the facilities, consulted the attending physician, Dr. Sy. 52 To Sister
Galeno, also a registered nurse, the matter of removal and its possible
repercussions on the health of the patient, as a matter of hospital policy, is a
critical and sensitive maneuver, and, hence, it is carried out only after discussing
with the doctors to evaluate all important factors.
With respect to the findings of the courts a quo that bed sores appeared on the
body of respondent Chua, that she suffered from depression after the
disconnection of the said facilities, that her private midwives were barred, and
that the delivery of food was delayed, this Court holds, as above, that these
conclusions are bereft of sound evidentiary basis, self-serving and
uncorroborated as they are.
The evidence in the record overwhelmingly demonstrates that respondent Chua
had been adequately attended to, and this Court cannot understand why the
courts a quo had declared that there was an "utter lack of medical attendance,"
or that her health suffered during the period after the removal of the facilities.
The Court finds that the facilities in question are non-essential for the care of
respondent Chua and, hence, they may be lessened or removed by the petitioner
for the sake of economic necessity and survival.
The underlying basis for the award of tort damages is the premise that an
individual was injured in contemplation of law. Thus, there must first be the
breach of some duty and the imposition of liability for that breach before
damages may be awarded; it is not sufficient to state that there should be tort
liability merely because the plaintiff suffered some pain and suffering.
While there are portions of the testimonies of the witnesses for the petitioner
which state that although, as per standard procedure, the patient "cannot leave"
the hospital without the "discharge," "clearance" or "gate pass" issued only after
arrangements on the settlement of bills had been made, still, it must be
understood that these are only demonstrative of the precondition that a patient
cannot step out of the premises "without the consent" of the hospital, or, in other
words, that the "clearance" merely indicates that the hospital expressly
consented to the actual release of the patient, but, even without its consent, the
patient is still free to leave "anytime" as a matter of policy, in spite of the refusal
to issue a "clearance" or "gate pass," or even in cases where the accounts have
not yet been liquidated or settled, or yet even if no promissory note or post-dated
check were executed in favor of the petitioner, as testified by no less than Sister
Galeno,102and corroborated by Editha Vecino; and that, petitioner, a private
hospital established for profit, being also a business, by warning respondents that
it shall withhold clearance, is simply exercising its right to protest against an
absconding patient as a precursor to avail of other appropriate legal remedies;
that, on the contrary, the respondents opted not to leave because of their own
promise not to leave unless the hospital bills were fully settled; that the
accusations found in the Demand Letter dated May 19, 1992, and signed by the
counsel for the respondents,106 particularly, that the petitioner "refused to
discharge the patient, [respondent Chua,] despite orders from the attending
physician, Dr. Rody Sy," had all been refuted by Sister Galeno when she read its
contents in front of the counsel for respondents, emphatically telling him that "we
are not detaining his clients;" that "[respondent Ty] was the one who told us that
they are not going to leave the hospital unless they have fully paid the
hospital;"107 and that, most importantly, no physical restraint upon the person
of respondent Chua or upon the person of her relatives had been imposed by the
staff.
Authorities, including those of common law origin, explicitly declare that a
patient cannot be detained in a hospital for non-payment of the hospital bill. If
the patient cannot pay the hospital or physician's bill, the law provides a remedy
for them to pursue, that is, by filing the necessary suit in court for the recovery of
such fee or bill. If the patient is prevented from leaving the hospital for his
inability to pay the bill, any person who can act on his behalf can apply in court
for the issuance of the writ of habeas corpus.
The form of restraint must be total; movement must be restrained in all
directions. If restraint is partial, e.g., in a particular direction with freedom to
proceed in another, the restraint on the person's liberty is not total. 110 However,
the hospital may legally detain a patient against his will when he is a detained or
convicted prisoner, or when the patient is suffering from a very contagious
disease where his release will be prejudicial to public health, or when the patient
is mentally ill such that his release will endanger public safety, or in other exigent
cases as may be provided by law. Moreover, under the common law doctrines on
tort, it does not constitute a trespass to the person to momentarily prevent him
from leaving the premises or any part thereof because he refuses to comply with
some reasonable condition subject to which he entered them.
In view of the foregoing, the Court therefore holds that the courts a quo
committed serious errors in finding that the petitioner was "biased,"
"discriminated" against the respondents, and "purposely intended to irritate" or
"harass" them; that it "acted in bad faith in removing the facilities without prior
notice;" and that its acts were "anti-social."126 The aforequoted declarations of
the witnesses, significant portions of which this Court considers as expert
testimony, are reliable and remain considerably trustworthy to controvert
respondents' assertions as well as to reverse the conclusions of fact and law of
the CA and the RTC that respondent Chua suffered the physical and emotional
anguish so claimed, and so, for these reasons, the Court holds that the petitioner
inflicted no actionable wrong.
This Court observes that the courts a quo awarded both respondents moral
damages. But it is well-settled that in case of physical injuries, with some
exceptions, moral damages are recoverable only by the party injured and not by
her spouse, next of kin, or relative who happened to sympathize with the injured
party. 128 Hence, even if the courts a quo were correct in their basis for damages,
they should have declined to award damages to respondent Ty.
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals
dated October 2, 2001, together with the Decision dated September 30, 1997 of
the Regional Trial Court in Civil Case No. 63958, is REVERSED and SET ASIDE.
Another judgment is entered dismissing the Complaint and ordering
respondents, jointly and severally, to pay the petitioner the amount of
P865,592.95, with stipulated interest of 12 percent reckoned from the date of
extrajudicial demand until full payment, and 12 percent of the total amount due
as attorney's fees.
-Mika Ituriaga
B. Requisites and other factors to consider in the award of moral damages
G.R. No. 150487. July 10, 2003.
GERARDO F. SAMSON, JR., petitioner, vs. BANK OF THE PHILIPPINE ISLANDS,
respondent.
FACTS:
Gerardo F. Samson, Jr. filed an action for damages against the Bank of the
Philippine Islands. “In his complaint, petitioner avers, inter alia that he is a
client/depositor of respondent; that on August 20, 1990, petitioner deposited to
his BPI account a check in the amount of P3,500.00; that as of said date,
petitioner’s account balance was P367.38; that on August 24, 1990, petitioner
instructed his daughter to withdraw P2,000.00 from the said account; that the
withdrawal was declined twice as the Express Teller transaction record showed
‘Sorry, Insufficient Funds’; that because of such eventuality, petitioner suffered
embarrassment as he could not then and there produce the required cash with
which to fulfill his commitment and monetary obligation towards a creditor who
had waited at his residence; that on September 12, 1990, petitioner deposited to
his aforesaid account through the Express Teller, the amount of P5,500.00; that
he discovered that his available total balance as of said date was only P342.38
without his earlier check deposit of P3,500.00 on August 20, 1990 but with a
P25.00 penalty/service charge; that petitioner complained to respondent about
the discrepancy; that respondent confirmed the P3,500.00 check deposit but
could not account the same; that investigation only ensued after petitioner
informed respondent that his P3,500.00 Prudential Bank check was encashed by
respondent’s security guard named Nonilon E. Rondina; that per such
investigation, it was discovered that one of the deposit envelopes was missing;
that respondent did nothing to look for the missing check deposit or to inform
petitioner about it; that despite respondent’s knowledge of the irregularity and
suspicious discrepancy in its records as early as of August 20, 1990, it did not
even bother to conduct its own inquiry into said irregularity; that worse, despite
being at fault, respondent’s Manager, Nerissa M. Cayanga, displayed arrogance,
indifference and discourtesy towards petitioner.
After trial on the merits, the trial court rendered a Decision in favor of petitioner.
Since it was undisputed that BPI had lost the check of petitioner, the appellate
court reviewed the evidence and held that respondent bank was grossly
negligent in its failure to observe the required degree of care. This gross
negligence on the part of BPI amounted to bad faith that entitled petitioner to
moral damages. The moral damages of P200,000 awarded by the trial court was,
however, found to be excessive. It was therefore reduced to P50,000, because
petitioner claimed only P3,500, which had already been credited back to his
account. Hence, this Petition.
ISSUE:
Whether the CA erred in reducing the award of moral damages from P200,000 to
only P50,000.
RULING:
The Petition is partly meritorious.
Moral damages are meant to compensate the claimant for any physical
suffering, mental anguish, fright, serious anxiety, besmirched reputation,
wounded feelings, moral shock, social humiliation and similar injuries
unjustly caused. Although incapable of pecuniary estimation the amount
must somehow be proportional to and in approximation of the suffering
inflicted. Moral damages are not punitive in nature and were never
intended to enrich the claimant the expense of the defendant.
There is no hard-and-fast rule in determining what would be a fair and
reasonable amount of moral damages, since each case must be governed by its
own peculiar facts. Trial courts are given discretion in determining the amount,
with the limitation that it “should not be palpably and scandalously
excessive.” Indeed, it must be commensurate to the loss or injury suffered.
“Moral damages are awarded to enable the injured party to obtain means,
diversions or amusements that will serve to alleviate the moral suffering he/she
has undergone, by reason of the defendant’s culpable action. Its award is aimed
at restoration, as much as possible, of the spiritual status quo ante; thus, it must
be proportionate to the suffering inflicted. x x x.”
The social standing of the aggrieved party is essential to the determination
of the proper amount of the award. Otherwise, the goal of enabling him to
obtain means, diversions, or amusements to restore him to the status quo ante
would not be achieved. We believe that the award should be increased to
P100,000, considering (1) that petitioner was a businessman and was the highest
lay person in the United Methodist Church; (2) that he was regarded by
respondent and its officers with arrogance and a condescending manner; and (3)
that respondent successfully postponed compensating him for more than a
decade.
That petitioner reported the missing check deposit to respondent only after three
weeks did not constitute contributory negligence. The injury resulted from the
denial of his withdrawal due to insufficient funds, an injury he suffered before
learning that his check deposit had been lost. Respondent, not he, immediately
knew that a deposit envelop was missing, yet it did nothing to solve the problem.
His alleged delay in reporting the matter did not at all contribute to his injury.
Though the amount of P3,500 was already credited back to his account, this step
was made only after his persistent prompting. Prior to this development, he
suffered damages that could no longer be reversed by the belated restoration of
the amount lost. It is for this suffering that moral damages are due. In Prudential
Bank v. CA, Philippine National Bank v. CA and Metropolitan Bank v. Wong, the
Court consistently awarded moral damages of P100,000 in consideration of
the reputation and the social standing of the claimant, as well as the rulings
in similar cases involving the negligence of banks with regard to the
accounts of their depositors.
WHEREFORE, the Petition is partly GRANTED and the assailed Decision
MODIFIED. The award of moral damages is increased to P100,000. No
pronouncement as to costs.
CATHAY PACIFIC AIRWAYS, LTD., petitioner, vs. SPOUSES DANIEL VAZQUEZ
and MARIA LUISA MADRIGAL VAZQUEZ, respondents.
G.R. No. 150843 March 14, 2003 Davide, Jr., C.J.:
FACTS: As part of its marketing strategy, Cathay Pacific Airways accords its
frequent flyers membership in its Marco Polo Club. The members enjoy several
privileges, such as priority for upgrading of booking without any extra charge
whenever an opportunity arises. Thus, a frequent flyer booked in the Business
Class has priority for upgrading to First Class if the Business Class Section is fully
booked.
Respondents-spouses Dr. Daniel Earnshaw Vazquez and Maria Luisa Madrigal
Vazquez are frequent flyers of Cathay and are Gold Card members of its Marco
Polo Club. On 24 September 1996, the Vazquezes, together with their maid and
two friends Pacita Cruz and Josefina Vergel de Dios, went to Hongkong for
pleasure and business.
For their return flight to Manila, the Vazquezes and their companions were given
their respective boarding passes, to wit, Business Class boarding passes for the
Vazquezes and their two friends, and Economy Class for their maid. When
boarding time was announced, the Vazquezes and their two friends went to the
departure gate. Dr. Vazquez presented his boarding pass to the ground
stewardess. Ms. Chiu approached Dr. Vazquez and told him that the Vazquezes’
accommodations were upgraded to First Class. Dr. Vazquez refused the upgrade,
reasoning that it would not look nice for them as hosts to travel in First Class and
their guests, in the Business Class; and moreover, they were going to discuss
business matters during the flight. He also told Ms. Chiu that she could have other
passengers instead transferred to the First Class Section. Ms. Chiu informed the
latter that the Business Class was fully booked, and that since they were Marco
Polo Club members they had the priority to be upgraded to the First Class. Dr.
Vazquez continued to refuse, so Ms. Chiu told them that if they would not avail
themselves of the privilege, they would not be allowed to take the flight.
Eventually, after talking to his two friends, Dr. Vazquez gave in. He and Mrs.
Vazquez then proceeded to the First Class Cabin.
Upon their return to Manila, the Vazquezes instituted before the RTC of Makati
City an action for damages against Cathay, praying for the payment to each of
them the amounts of P250,000 as temperate damages; P500,000 as moral
damages; P500,000 as exemplary or corrective damages; and P250,000 as
attorney’s fees.

The trial court found for the Vazquezes. According to the trial court, Cathay offers
various classes of seats from which passengers are allowed to choose regardless
of their reasons or motives, whether it be due to budgetary constraints or whim.
The choice imposes a clear obligation on Cathay to transport the passengers in
the class chosen by them. The carrier cannot, without exposing itself to liability,
force a passenger to involuntarily change his choice.
On appeal, the Court of Appeals, deleted the award for exemplary damages; and
it reduced the awards for moral and nominal damages for each of the Vazquezes
to P250,000 and P50,000, respectively, and the attorney’s fees and litigation
expenses to P50,000 for both of them. The Court of Appeals ratiocinated that by
upgrading the Vazquezes to First Class, Cathay novated the contract of carriage
without the former’s consent. There was a breach of contract not because Cathay
overbooked the Business Class Section of Flight CX-905 but because the latter
pushed through with the upgrading despite the objections of the Vazquezes.
However, the Court of Appeals was not convinced that Ms. Chiu shouted at, or
meant to be discourteous to, Dr. Vazquez, although it might seemed that way to
the latter, who was a member of the elite in Philippine society and was not
therefore used to being harangued by anybody. Ms. Chiu was a Hong Kong
Chinese whose fractured Chinese was difficult to understand and whose manner
of speaking might sound harsh or shrill to Filipinos because of cultural
differences.
ISSUES:
1. W/N by upgrading the seat accommodation of the Vazquezes from
Business Class to First Class Cathay breached its contract of carriage
with the Vazquezes (YES)
2. W/N the upgrading was tainted with fraud or bad faith (NO)
3. W/N the Vazquezes are entitled to damages. (YES, but only nominal
damages)
RULING:
1. YES, Cathay breached its contract of carriage with the Vazquezes.
Undoubtedly, a contract of carriage existed between Cathay and the Vazquezes.
They voluntarily and freely gave their consent to an agreement whose object was
the transportation of the Vazquezes from Manila to Hong Kong and back to
Manila, with seats in the Business Class Section of the aircraft, and whose cause
or consideration was the fare paid by the Vazquezes to Cathay.
Breach of contract is defined as the "failure without legal reason to comply with
the terms of a contract." It is also defined as the "failure, without legal excuse, to
perform any promise which forms the whole or part of the contract."
We note that in all their pleadings, the Vazquezes never denied that they were
members of Cathay’s Marco Polo Club. They knew that as members of the Club,
they had priority for upgrading of their seat accommodation at no extra cost
when an opportunity arises. But, just like other privileges, such priority could be
waived. The Vazquezes should have been consulted first whether they wanted to
avail themselves of the privilege or would consent to a change of seat
accommodation before their seat assignments were given to other passengers.
Normally, one would appreciate and accept an upgrading, for it would mean a
better accommodation. But, whatever their reason was and however odd it might
be, the Vazquezes had every right to decline the upgrade and insist on the
Business Class accommodation they had booked for and which was designated in
their boarding passes. They clearly waived their priority or preference when they
asked that other passengers be given the upgrade. It should not have been
imposed on them over their vehement objection. By insisting on the upgrade,
Cathay breached its contract of carriage with the Vazquezes.
2. NO, upgrading was not tainted with fraud or bad faith.
Bad faith and fraud are allegations of fact that demand clear and convincing proof.
Fraud has been defined to include an inducement through insidious machination.
Insidious machination refers to a deceitful scheme or plot with an evil or devious
purpose. Deceit exists where the party, with intent to deceive, conceals or omits
to state material facts and, by reason of such omission or concealment, the other
party was induced to give consent that would not otherwise have been given. Bad
faith does not simply connote bad judgment or negligence; it imports a dishonest
purpose or some moral obliquity and conscious doing of a wrong, a breach of a
known duty through some motive or interest or ill will that partakes of the nature
of fraud.
We find no persuasive proof of fraud or bad faith in this case. The Vazquezes were
not induced to agree to the upgrading through insidious words or deceitful
machination or through willful concealment of material facts. Upon boarding, Ms.
Chiu told the Vazquezes that their accommodations were upgraded to First Class
in view of their being Gold Card members of Cathay’s Marco Polo Club. She was
honest in telling them that their seats were already given to other passengers and
the Business Class Section was fully booked. Ms. Chiu might have failed to
consider the remedy of offering the First Class seats to other passengers. But, we
find no bad faith in her failure to do so, even if that amounted to an exercise of
poor judgment.
Neither was the transfer of the Vazquezes effected for some evil or devious
purpose. As testified to by Mr. Robson, the First Class Section is better than the
Business Class Section in terms of comfort, quality of food, and service from the
cabin crew; thus, the difference in fare between the First Class and Business Class
at that time was $250. Needless to state, an upgrading is for the better condition
and, definitely, for the benefit of the passenger.
We are not persuaded by the Vazquezes’ argument that the overbooking of the
Business Class Section constituted bad faith on the part of Cathay. As stated in
Section 3 of the Economic Regulation No. 7 of the Civil Aeronautics Board, as
amended, it is clear that an overbooking that does not exceed ten percent is not
considered deliberate and therefore does not amount to bad faith. Here, while
there was admittedly an overbooking of the Business Class, there was no
evidence of overbooking of the plane beyond ten percent, and no passenger was
ever bumped off or was refused to board the aircraft.
3. YES, the Vazquezes are entitled to damages but only nominal damages.
Moral damages include physical suffering, mental anguish, fright, serious anxiety,
besmirched reputation, wounded feelings, moral shock, social humiliation, and
similar injury. Although incapable of pecuniary computation, moral damages may
be recovered if they are the proximate result of the defendant’s wrongful act or
omission. Thus, case law establishes the following requisites for the award of
moral damages: (1) there must be an injury clearly sustained by the claimant,
whether physical, mental or psychological; (2) there must be a culpable act or
omission factually established; (3) the wrongful act or omission of the defendant
is the proximate cause of the injury sustained by the claimant; and (4) the award
for damages is predicated on any of the cases stated in Article 2219 of the Civil
Code.
Moral damages predicated upon a breach of contract of carriage may only
be recoverable in instances where the carrier is guilty of fraud or bad faith
or where the mishap resulted in the death of a passenger. Where in breaching
the contract of carriage the airline is not shown to have acted fraudulently or in
bad faith, liability for damages is limited to the natural and probable
consequences of the breach of the obligation which the parties had foreseen or
could have reasonably foreseen. In such a case the liability does not include moral
and exemplary damages.
In this case, we have ruled that the breach of contract of carriage, which consisted
in the involuntary upgrading of the Vazquezes’ seat accommodation, was not
attended by fraud or bad faith. The Court of Appeals’ award of moral damages
has, therefore, no leg to stand on.
The deletion of the award for exemplary damages by the Court of Appeals is
correct. It is a requisite in the grant of exemplary damages that the act of the
offender must be accompanied by bad faith or done in wanton, fraudulent
or malevolent manner. Such requisite is absent in this case. Moreover, to be
entitled thereto the claimant must first establish his right to moral,
temperate, or compensatory damages. Since the Vazquezes are not entitled to
any of these damages, the award for exemplary damages has no legal basis. And
where the awards for moral and exemplary damages are eliminated, so
must the award for attorney’s fees.
The most that can be adjudged in favor of the Vazquezes for Cathay’s breach of
contract is an award for nominal damages under Article 2221 of the Civil Code.
Nominal damages are adjudicated in order that a right of the plaintiff, which
has been violated or invaded by the defendant, may be vindicated or
recognized, and not for the purpose of indemnifying the plaintiff for any
loss suffered by him. Nonetheless, considering that the breach was intended to
give more benefit and advantage to the Vazquezes by upgrading their Business
Class accommodation to First Class because of their valued status as Marco Polo
members, we reduce the award for nominal damages to P5,000.
DISPOSITIVE PORTION:
WHEREFORE, the instant petition is hereby partly GRANTED. The Decision of the
Court of Appeals of 24 July 2001 in CA-G.R. CV No. 63339 is hereby MODIFIED,
and as modified, the awards for moral damages and attorney’s fees are set aside
and deleted, and the award for nominal damages is reduced to P5,000. No
pronouncement on costs. SO ORDERED.
BANK OF THE PHILIPPINE ISLANDS, Petitioner, vs. REYNALD R. SUAREZ,
Respondent.
G.R. No. 167750, SECOND DIVISION, March 15, 2010, CARPIO, J.
FACTS:
Respondent Reynald R. Suarez (Suarez) is a lawyer who used to maintain both
savings and current accounts with petitioner Bank of the Philippine Islands’ (BPI)
Ermita Branch from 1988 to 1997.
Sometime in 1997, Suarez had a client who planned to purchase several parcels
of land in Tagaytay City, but preferred not to deal directly with the land owners.
In accordance with his client’s instruction, Suarez transacted with the owners of
the Tagaytay properties, making it appear that he was the buyer of the lots. As
regards the payment of the purchase money, Suarez and his client made an
arrangement such that Suarez’s client would deposit the money in Suarez’s BPI
account and then, Suarez would issue checks to the sellers. Hence, on 16 June
1997, Suarez’s client deposited a Rizal Commercial Banking Corporation (RCBC)
check with a face value of ₱19,129,100, representing the total consideration of
the sales, in BPI Pasong Tamo Branch to be credited to Suarez’s current account
in BPI Ermita Branch.
Aware of the banking system’s 3-day check clearing policy, Suarez instructed his
secretary, Petronila Garaygay (Garaygay), to confirm from BPI whether the face
value of the RCBC check was already credited to his account that same day of 16
June 1997. According to Garaygay, BPI allegedly confirmed the same-day
crediting of the RCBC check. Relying on this confirmation, Suarez issued on the
same day five checks of different amounts totaling ₱19,129,100 for the purchase
of the Tagaytay properties.
The next day, Suarez left for the United States (U.S.) for a vacation. While Suarez
was in the U.S., Garaygay informed him that the five checks he issued were all
dishonored by BPI due to insufficiency of funds and that his current account had
been debited a total of ₱57,200 as penalty for the dishonor. Suarez’s secretary
further told him that the checks were dishonored despite an assurance from
RCBC, the drawee bank for the sum of ₱19,129,100, that this amount had already
been debited from the account of the drawer on 16 June 1997 and the RCBC check
was fully funded.
On 19 June 1997, the payees of the five BPI checks that Suarez issued on 16 June
1997 presented the checks again. Since the RCBC check (which Suarez’s client
issued) had already been cleared by that time, rendering Suarez’s available funds
sufficient, the checks were honored by BPI.
Subsequently, Suarez sent a letter to BPI demanding an apology and the reversal
of the charges debited from his account. Suarez received a call from Fe Gregorius,
then manager of the BPI Ermita Branch, who requested a meeting with him to
explain BPI’s side. However, the meeting did not transpire.
Suarez sent another letter to BPI addressed to its president, Xavier Loinaz.
Consequently, BPI representatives asked another meeting with Suarez. During
the meeting, the BPI officers handed Suarez a letter, the relevant text of which
reads:
Dear Atty. Suarez:
Our investigation discloses that when the checks you issued against your
account were received for clearing, the checks you deposited were not
yet cleared. Hence, the dishonor of the your checks.
We do not see much in your allegation that you have suffered damages
just because the reason for the return was "DAIF" and not "DAUD". In
both instances, there is a dishonor nonetheless.
Upon Suarez’s request, BPI delivered to him the five checks which he issued on
16 June 1997. Suarez claimed that the checks were tampered with, specifically
the reason for the dishonor, prompting him to send another letter informing BPI
of its act of falsification by making it appear that it marked the checks with
"drawn against uncollected deposit (DAUD) and not "drawn against insufficient
fund" (DAIF). In reply, BPI offered to reverse the penalty charges which were
debited from his account, but denied Suarez’s claim for damages. Suarez rejected
BPI’s offer.
Claiming that BPI mishandled his account through negligence, Suarez filed with
the Regional Trial Court a complaint for damages.
The Regional Trial Court, Makati City, Branch 136 rendered judgment in favor of
Suarez, awarding him ₱3,000,000.00 by way of moral damages.
BPI appealed to the Court of Appeals, which affirmed the trial court’s decision.
The Court of Appeals denied BPI’s motion for reconsideration in its 11 April 2005
Resolution.
ISSUE:
Whether BPI is liable to pay Suarez moral and exemplary damages, attorney’s
fees and costs of litigation. (NO)
RULING:
The petition is partly meritorious.
Suarez insists that BPI was negligent in handling his account when BPI
dishonored the checks he issued to various payees on 16 June 1997, despite the
RCBC check deposit made to his account on the same day to cover the total
amount of the BPI checks.
Negligence is defined as "the omission to do something which a reasonable man,
guided upon those considerations which ordinarily regulate the conduct of
human affairs, would do, or the doing of something which a prudent man and
reasonable man could not do." The question concerning BPI's negligence,
however, depends on whether BPI indeed confirmed the same-day crediting of
the RCBC check’s face value to Suarez’s BPI account.
In essence, Suarez impresses upon this Court that BPI is estopped from
dishonoring his checks since BPI confirmed the same-day crediting of the RCBC
check deposit and assured the adequacy of funds in his account. Suarez points out
that he relied on this confirmation for the issuance of his checks to the owners of
the Tagaytay properties. In other words, Suarez claims that BPI made a
representation that he had sufficient available funds to cover the total value of
his checks.
Suarez is mistaken.
Based on the records, there is no sufficient evidence to show that BPI conclusively
confirmed the same-day crediting of the RCBC check which Suarez’s client
deposited late on 16 June 1997. Suarez’s secretary, Garaygay, testified that she
was able to talk to a BPI male employee about the same-day crediting of the RCBC
check. However, Garaygay failed to (1) identify and name the alleged BPI
employee, and (2) establish that this particular male employee was authorized
by BPI either to disclose any information regarding a depositor’s bank account to
a person other than the depositor over the telephone, or to assure Garaygay that
Suarez could issue checks totaling the face value of the RCBC check. Moreover, a
same-day clearing of a ₱19,129,100 check requires approval of designated bank
official or officials, and not any bank official can grant such approval. Clearly,
Suarez failed to prove that BPI confirmed the same-day crediting of the RCBC
check, or that BPI assured Suarez that he had sufficient available funds in his
account. Accordingly, BPI was not estopped from dishonoring the checks for
inadequacy of available funds in Suarez’s account since the RCBC check remained
uncleared at that time.
While BPI had the discretion to undertake the same-day crediting of the RCBC
check, and disregard the banking industry’s 3-day check clearing policy, Suarez
failed to convincingly show his entitlement to such privilege. As BPI pointed out,
Suarez had no credit or bill purchase line with BPI which would qualify him to
the exceptions to the 3-day check clearing policy.
Considering that there was no binding representation on BPI’s part as regards
the same-day crediting of the RCBC check, no negligence can be ascribed to BPI’s
dishonor of the checks precisely because BPI was justified in dishonoring the
checks for lack of available funds in Suarez’s account.
However, BPI mistakenly marked the dishonored checks with "drawn against
insufficient funds (DAIF), " instead of "drawn against uncollected deposit
(DAUD)." DAUD means that the account has, on its face, sufficient funds but not
yet available to the drawer because the deposit, usually a check, had not yet been
cleared. DAIF, on the other hand, is a condition in which a depositor’s balance is
inadequate for the bank to pay a check. In other words, in the case of DAUD, the
depositor has, on its face, sufficient funds in his account, although it is not
available yet at the time the check was drawn, whereas in DAIF, the depositor
lacks sufficient funds in his account to pay the check. Moreover, DAUD does not
expose the drawer to possible prosecution for estafa and violation of BP 22, while
DAIF subjects the depositor to liability for such offenses. It is clear therefore that,
contrary to BPI’s contention, DAIF differs from DAUD. Now, does the erroneous
marking of DAIF, instead of DAUD, give rise to BPI’s liability for damages?
The following are the conditions for the award of moral damages: (1) there is an
injury — whether physical, mental or psychological — clearly sustained by the
claimant; (2) the culpable act or omission is factually established; (3) the
wrongful act or omission of the defendant is the proximate cause of the injury
sustained by the claimant; and (4) the award of damages is predicated on any of
the cases stated in Article 2219 of the Civil Code.
In the present case, Suarez failed to establish that his claimed injury was
proximately caused by the erroneous marking of DAIF on the checks. Proximate
cause has been defined as "any cause which, in natural and continuous sequence,
unbroken by any efficient intervening cause, produces the result complained of
and without which would not have occurred." There is nothing in Suarez’s
testimony which convincingly shows that the erroneous marking of DAIF on the
checks proximately caused his alleged psychological or social injuries. Suarez
merely testified that he suffered humiliation and that the prospective
consolidation of the titles to the Tagaytay properties did not materialize due to
the dishonor of his checks, not due to the erroneous marking of DAIF on his
checks. Hence, Suarez had only himself to blame for his hurt feelings and the
unsuccessful transaction with his client as these were directly caused by the
justified dishonor of the checks. In short, Suarez cannot recover compensatory
damages for his own negligence.
While the erroneous marking of DAIF, which BPI belatedly rectified, was not the
proximate cause of Suarez’s claimed injury, the Court reminds BPI that its
business is affected with public interest. It must at all times maintain a high level
of meticulousness and should guard against injury attributable to negligence or
bad faith on its part. Suarez had a right to expect such high level of care and
diligence from BPI. Since BPI failed to exercise such diligence, Suarez is entitled
to nominal damages to vindicate Suarez’s right to such high degree of care and
diligence. Thus, we award Suarez ₱75,000.00 nominal damages.
On the award of actual damages, we find the same without any basis. Considering
that BPI legally dishonored the checks for being drawn against uncollected
deposit, BPI was justified in debiting the penalty charges against Suarez’s
account, pursuant to the Rules of the Philippine Clearing House Corporation.
In view of the foregoing, the Court deems it unnecessary to resolve the other
issues raised in this case.
WHEREFORE, the Court GRANTS the petition in part. The Court SETS ASIDE the
30 November 2004 Decision and 11 April 2005 Resolution of the Court of Appeals
in CA-G.R. CV No. 76988, and deletes the award of all damages and fees. The Court
awards to respondent Reynald R. Suarez nominal damages in the sum of
₱75,000.00. SO ORDERED.
IGNACIO BARZAGA, PETITIONER, VS. COURT OF APPEALS AND ANGELITO
ALVIAR, RESPONDENTS.
G.R. No. 115129, February 12, 1997, BELLOSILLO, J.
Facts:
On the nineteenth of December Ignacio's wife succumbed to a debilitating
ailment after prolonged pain and suffering. Forewarned by her attending
physicians of her impending death, she expressed her wish to be laid to rest
before Christmas day to spare her family from keeping lonely vigil over her
remains while the whole of Christendom celebrate the Nativity of their
Redeemer.
On 21 December 1990, at about three o`clock in the afternoon, he went to the
hardware store of respondent Angelito Alviar to inquire about the availability of
certain materials to be used in the construction of a niche for his wife. He also
asked if the materials could be delivered at once. Marina Boncales, Alviar's
storekeeper, replied that she had yet to verify if the store had pending deliveries
that afternoon because if there were then all subsequent purchases would have
to be delivered the following day. With that reply petitioner left.
At seven o' clock the following morning, 22 December, Barzaga returned to
Alviar's hardware store to follow up his purchase of construction materials. He
told the store employees that the materials he was buying would have to be
delivered at the Memorial Cemetery in Dasmariñas, Cavite, by eight o'clock that
morning since his hired workers were already at the burial site and time was of
the essence. Marina Boncales agreed to deliver the items at the designated time,
date and place. With this assurance, Barzaga purchased the materials and paid in
full the amount of P2,110.00. Thereafter he joined his workers at the cemetery,
which was only a kilometer away, to await the delivery.
The construction materials did not arrive at eight o'clock as promised. At nine o'
clock, the delivery was still nowhere in sight. Barzaga returned to the hardware
store to inquire about the delay. Boncales assured him that although the delivery
truck was not yet around it had already left the garage and that as soon as it
arrived the materials would be brought over to the cemetery in no time at all.
That left petitioner no choice but to rejoin his workers at the memorial park and
wait for the material.
By ten o'clock, there was still no delivery. This prompted petitioner to return to
the store to inquire about the materials. But he received the same answer from
respondent's employees who even cajoled him to go back to the burial place as
they would just follow with his construction materials.
After hours of waiting - which seemed interminable to him - Barzaga became
extremely upset. He decided to dismiss his laborers for the day. He proceeded to
the police station, which was just nearby, and lodged a complaint against Alviar.
He had his complaint entered in the police blotter. When he returned again to the
store he saw the delivery truck already there but the materials he purchased
were not yet ready for loading. Distressed that Alviar's employees were not the
least concerned, despite his impassioned pleas, Barzaga decided to cancel his
transaction with the store and look for construction materials elsewhere.
In the afternoon of that day, petitioner was able to buy from another store. But
since darkness was already setting in and his workers had left, he made up his
mind to start his project the following morning, 23 December. But he knew that
the niche would not be finish in time for the scheduled burial the following day.
His laborers had to take a break on Christmas Day and they could only resume in
the morning of the twenty-sixth. The niche was completed in the afternoon and
Barzaga's wife was finally laid to rest. However, it was two-and-a-half (2-1/2)
days behind schedule.
On 21 January 1991, tormented perhaps by his inability to fulfill his wife's dying
wish, Barzaga wrote private respondent Alviar demanding recompense for the
damage he suffered. Alviar did not respond. Consequently, petitioner sued him
before the Regional Trial Court.
Upholding the proposition that respondent incurred in delay in the delivery of
the construction materials resulting in undue prejudice to petitioner, the trial
court ordered respondent Alviar to pay petitioner (a) P2,110.00 as refund for the
purchase price of the materials with interest per annum computed at the legal
rate from the date of the filing of the complaint, (b) P5,000.00 as temperate
damages, (c) P20,000.00 as moral damages, (d) P5,000.00 as litigation expenses,
and (e) P5,000.00 as attorney's fees.
On appeal, respondent Court of Appeals reversed the lower court and ruled that
there was no contractual commitment as to the exact time of delivery since this
was not indicated in the invoice receipts covering the sale.
Issue:
Whether or not Alviar should be held liable for damages since he was negligent
in performing his contractual obligation. (Yes)
Ruling:
The law expressly provides that those who in the performance of their obligation
are guilty of fraud, negligence, or delay and those who in any manner contravene
the tenor thereof, are liable for damages.
Contrary to the appellate court's factual determination, there was a specific time
agreed upon for the delivery of the materials to the cemetery. Petitioner went to
private respondent's store on 21 December precisely to inquire if the materials
he intended to purchase could be delivered immediately. But he was told by the
storekeeper that if there were still deliveries to be made that afternoon his order
would be delivered the following day. With this in mind Barzaga decided to buy
the construction materials the following morning after he was assured of
immediate delivery according to his time frame. The argument that the invoices
never indicated a specific delivery time must fall in the face of the positive verbal
commitment of respondent's storekeeper. Consequently it was no longer
necessary to indicate in the invoices the exact time the purchased items were to
be brought to the cemetery. In fact, storekeeper Boncales admitted that it was her
custom not to indicate the time of delivery whenever she prepared invoices.
We also find unacceptable respondent's justification that his truck had a flat tire,
for this event, if indeed it happened, was forseeable according to the trial court,
and as such should have been reasonably guarded against. The nature of private
respondent's business requires that he should be ready at all times to meet
contingencies of this kind. One piece of testimony by respondent's witness
Marina Boncales has caught our attention - that the delivery truck arrived a little
late than usual because it came from a delivery of materials in Langcaan,
Dasmariñas, Cavite. Significantly, this information was withheld by Boncales
from petitioner when the latter was negotiating with her for the purchase of
construction materials. Consequently, it is not unreasonable to suppose that had
she told petitioner of this fact and that the delivery of the materials would
consequently be delayed, petitioner would not have bought the materials from
respondent's hardware store but elsewhere which could meet his time
requirement. The deliberate suppression of this information by itself manifests a
certain degree of bad faith on the part of respondent's storekeeper.
The appellate court appears to have belittled petitioner's submission that under
the prevailing circumstances time was of the essence in the delivery of the
materials to the grave site. However, we find petitioner's assertion to be
anchored on solid ground. The niche had to be constructed at the very least on
the twenty-second of December considering that it would take about two (2) days
to finish the job if the interment was to take place on the twenty-fourth of the
month. Respondent's delay in the delivery of the construction materials wasted
so much time that construction of the tomb could start only on the twenty-third.
It could not be ready for the scheduled burial of petitioner's wife. This
undoubtedly prolonged the wake, in addition to the fact that work at the
cemetery had to be put off on Christmas day.
This case is clearly one of non-performance of a reciprocal obligation.[7] In their
contract of purchase and sale, petitioner had already complied fully with what
was required of him as purchaser, i.e., the payment of the purchase price of
P2,110.00. It was incumbent upon respondent to immediately fulfill his
obligation to deliver the goods otherwise delay would attach.
We therefore sustain the award of moral damages. It cannot be denied that
petitioner and his family suffered wounded feelings, mental anguish and serious
anxiety while keeping watch on Christmas day over the remains of their loved
one who could not be laid to rest on the date she herself had chosen. There is no
gainsaying the inexpressible pain and sorrow Ignacio Barzaga and his family bore
at that moment caused no less by the ineptitude, cavalier behavior and bad faith
of respondent and his employees in the performance of an obligation voluntarily
entered into.
We also affirm the grant of exemplary damages. The lackadaisical and feckless
attitude of the employees of respondent over which he exercised supervisory
authority indicates gross negligence in the fulfillment of his business obligations.
Respondent Alviar and his employees should have exercised fairness and good
judgment in dealing with petitioner who was then grieving over the loss of his
wife. Instead of commiserating with him, respondent and his employees
contributed to petitioner's anguish by causing him to bear the agony resulting
from his inability to fulfill his wife's dying wish.
We delete however the award of temperate damages. Under Art. 2224 of the Civil
Code, temperate damages are more than nominal but less than compensatory,
and may be recovered when the court finds that some pecuniary loss has been
suffered but the amount cannot, from the nature of the case, be proved with
certainty. In this case, the trial court found that plaintiff suffered damages in the
form of wages for the hired workers for 22 December 1990 and expenses
incurred during the extra two (2) days of the wake. The record however does not
show that petitioner presented proof of the actual amount of expenses he
incurred which seems to be the reason the trial court awarded to him temperate
damages instead. This is an erroneous application of the concept of temperate
damages. While petitioner may have indeed suffered pecuniary losses, these by
their very nature could be established with certainty by means of payment
receipts. As such, the claim falls unequivocally within the realm of actual or
compensatory damages. Petitioner's failure to prove actual expenditure
consequently conduces to a failure of his claim. For in determining actual
damages, the court cannot rely on mere assertions, speculations, conjectures or
guesswork but must depend on competent proof and on the best evidence
obtainable regarding the actual amount of loss.
We affirm the award of attorney's fees and litigation expenses. Award of
damages, attorney's fees and litigation costs is left to the sound discretion of the
court, and if such discretion be well exercised, as in this case, it will not be
disturbed on appeal.
WHEREFORE, the decision of the Court of Appeals is REVERSED and SET ASIDE
except insofar as it GRANTED on a motion for reconsideration the refund by
private respondent of the amount of P2,110.00 paid by petitioner for the
construction materials. Consequently, except for the award of P5,000.00 as
temperate damages which we delete, the decision of the Regional Trial Court
granting petitioner (a) P2,110.00 as refund for the value of materials with
interest computed at the legal rate per annum from the date of the filing of the
case; (b) P20,000.00 as moral damages; (c) P10,000.00 as exemplary damages;
(d) P5,000.00 as litigation expenses; and (4) P5,000.00 as attorney's fees, is
AFFIRMED. No costs.
SO ORDERED.
PHILIPPINE AEOLUS AUTO-MOTIVE UNITED CORPORATION and/or
FRANCIS CHUA, petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION and ROSALINDA C. CORTEZ,
respondents.G.R. No. 124617 April 28, 2000 BELLOSILLO, J.:
G.R. No. 124617 April 28, 2000 BELLOSILLO, J.:
FACTS: Petitioner Philippine Aeolus Automotive United Corporation (PAAUC) is
a corporation duly organized and existing under Philippine laws, petitioner
Francis Chua is its President while private respondent Rosalinda C. Cortez was a
company nurse1 of petitioner corporation until her termination on 7 November
1994.
A memorandum was a issued by Ms. Myrna Palomares, Personnel Manager of
petitioner corporation, addressed to private respondent Rosalinda C. Cortez
requiring her to explain within forty-eight (48) hours why no disciplinary action
should be taken against her (a) for throwing a stapler at Plant Manager William
Chua, her superior, and uttering invectives against him (b) for losing the amount
of P1,488.00 entrusted to her by Plant Manager Chua to be given to Mr. Fang of
the CLMC Department (c) for asking a co-employee to punch-in her time card thus
making it appear that she was in the office in the morning of 6 September 1944
when in fact she was not. The memorandum however was refused by private
respondent although it was read to her and discussed with her by a co-employee.
She did not also submit the required explanation, so that while her case pending
investigation the company placed her under preventive suspension for thirty
(30) days.
While Cortez was still under preventive suspension, another memorandum was
issued by petitioner corporation giving her seventy-two (72) hours to explain
why no disciplinary action should be taken against her for allegedly failing to
process the ATM applications of her nine (9) co-employees with the Allied
Banking Corporation. Private respondent also refused to receive the second
memorandum although it was read to her by a co-employee. A copy of the
memorandum was also sent by the Personnel Manager to private respondent at
her last known address by registered mail.
Meanwhile, private respondent submitted a written explanation with respect to
the loss of the P1,488.00 and the punching-in of her time card by a co-employee.
A third memorandum was issued to private respondent, this time informing her
of her termination from the service on grounds of gross and habitual neglect of
duties, serious misconduct and fraud or willful breach of trust.
Private respondent filed with the Labor Arbiter a complaint for illegal dismissal,
non-payment of annual service incentive leave pay, 13th month pay and damages
against PAAUC and its president Francis Chua.
The Labor Arbiter rendered a decision holding the termination of Cortez as valid
and legal. On appeal to the NLRC, public respondent reversed, the decision of the
Labor Arbiter and found petitioner corporation guilty of illegal dismissal of
private respondent Cortez. The NLRC ordered petitioner PAAUC to reinstate
respondent Cortez to her former position with back wages computed from the
time of dismissal up to her actual reinstatement. Petitioners moved for
reconsideration. The motion was denied; hence, this petition for certiorari
challenging the NLRC Decision and Resolution.
ISSUES:
(1) Whether the NLRC gravely abused its discretion in holding as illegal the
dismissal of private respondent, and NO.
(2) Whether she is entitled to damages in the event that the illegality of her
dismissal is sustained. YES. – TOPIC RELATED
RULING:
(1)The Supreme Court has ruled that for misconduct or improper behavior to be
a just cause for dismissal (a) it must be serious; (b) must relate to the
performance of the employee's duties; and, (c) must show that the employee has
become unfit to continue working for the employer. The act of private
respondent in throwing a stapler and uttering abusive language upon the person
of the plant manager may be considered, from a lay man's perspective, as a
serious misconduct. However, in order to consider it a serious misconduct that
would justify dismissal under the law, it must have been done in relation to the
performance of her duties as would show her to be unfit to continue working for
her employer. The acts complained of, under the circumstances they were done,
did not in any way pertain to her duties as a nurse.
As regards the third alleged infraction, i.e., the act of private respondent in asking
a co-employee to punch-in her time card, although a violation of company rules,
likewise does not constitute serious misconduct. Firstly, it was done by her in
good faith considering that she was asked by an officer to perform a task outside
the office, which was for the benefit of the company, with the consent of the plant
manager. Secondly, it was her first time to commit such infraction during her five
(5)-year service in the company. Finally, the company did not lose anything by
reason thereof as the offense was immediately known and corrected.
On alleged infraction No. 4, the money entrusted to her was in fact deposited in
the respective accounts of the employees concerned, although belatedly. We
agree with the submission of the Solicitor General that — The mere delay/failure
to open an ATM account for nine employees is not sufficient, by itself, to support
a conclusion that Rosalinda is guilty of gross and habitual neglect of duties.
Gross negligence implies a want or absence of or failure to exercise slight care or
diligence, or the entire absence of care. The negligence, to warrant removal from
service, should not merely be gross but also habitual. Likewise, the ground "willful
breach by the employee of the trust reposed in him by his employer" must be
founded on facts established by the employer who must clearly and convincingly
prove by substantial evidence the facts and incidents upon which loss of
confidence in the employee may fairly be made to rest. All these requirements
prescribed by law and jurisprudence are wanting in the case at bar.

(2) YES.
On the issue of moral and exemplary damages, the NLRC ruled that private
respondent was not entitled to recover such damages for her failure to prove that
petitioner corporation had been motivated by malice or bad faith or that it acted in
a wanton, oppressive or malevolent manner in terminating her services., Public
respondent quoted the Labor Arbiter —Complainant's assertion that the cause of
the altercation between her and the Plant Manager where she threw a stapler to
him and uttered invectives against him was her refusal to submit to his advances to
her which started from her early days of employment and lasted for almost four
years, is hardly believabl e. Public respondent in thus concluding appears baffled
why it took private respondent more than four (4) years to expose William Chua's
alleged sexual harassment. It reasons out that it would have been more prepared to
support her position if her act of throwing the stapler and uttering invectives on
William Chua were her immediate reaction to his amorous overtures.
We are not persuaded. The gravamen of the offense in sexual harassment is not
the violation of the employee's sexuality but the abuse of power by the employer.
Any employee, male or female, may rightfully cry "foul" provided the claim is well
substantiated. Strictly speaking, there is no time period within which he or she is
expected to complain through the proper channels. The time to do so may vary
depending upon the needs, circumstances, and more importantly, the emotional
threshold of the employee.
Private respondent admittedly allowed four (4) years to pass before finally
coming out with her employer's sexual impositions. If petitioner corporation had
not issued the third memorandum that terminated the services of private
respondent, we could only speculate how much longer she would keep her
silence. Moreover, few persons are privileged indeed to transfer from one
employer to another. Perhaps, to private respondent's mind, for as long as she
could outwit her employer's ploys she would continue on her job and consider
them as mere occupational hazards. This uneasiness in her place of work thrived
in an atmosphere of tolerance for four (4) years, and one could only imagine the
prevailing anxiety and resentment, if not bitterness, that beset her all that time.
But William Chua faced reality soon enough. Since he had no place in private
respondent's heart, so must she have no place in his office. So, he provoked her,
harassed her, and finally dislodged her; and for finally venting her pent-up anger
for years, he "found" the perfect reason to terminate her.
In determining entitlement to moral and exemplary damages, we restate the
bases therefor. In moral damages, it suffices to prove that the claimant has
suffered anxiety, sleepless nights, besmirched reputation and social humiliation
by reason of the act complained of. Exemplary damages, on the other hand, are
granted in addition to, inter alia, moral damages "by way of example or correction
for the public good" 23 if the employer ''acted in a wanton, fraudulent, reckless,
oppressive or malevolent manner." 24
Anxiety was gradual in private respondent's five (5)-year employment. It began
when her plant manager showed an obvious partiality for her which went out of
hand when he started to make it clear that he would terminate her services if she
would not give in to his sexual advances. Sexual harassment is an imposition of
misplaced "superiority" which is enough to dampen an employee's spirit in her
capacity for advancement. Thus, for the anxiety, the seen and unseen hurt that
she suffered, petitioners should also be made to pay her moral damages, plus
exemplary damages, for the oppressive manner with which petitioners effected
her dismissal from the service, and to serve as a forewarning to lecherous officers
and employers who take undue advantage of their ascendancy over their
employees.
C. When Recoverable (Art. 2219, par 1, 3, 4, 5 and 7. Art. 2220, New Civil
Code, Art. 345, RPC)
1. In seduction, abduction, rape, incestuous rape, sexual harrassment
and other lascivious acts
PEOPLE OF THE PHILIPPINES, Appellee, vs. EDGARDO DIMAANO, Appellant.
G.R. No. 168168, EN BANC, September 14, 2005, PER CURIAM:
FACTS:
Maricar Dimaano charged her father, Edgardo Dimaano with two (2) counts of
rape and one (1) count of attempted rape.
Complainant was born on August 26, 1983, and was 10 years old when she was
first sexually abused in the morning of September 1993. While inside their house
in Sucat, Paraaque, appellant entered her room and laid down beside her. He
removed her clothes and asked her to lie face down then inserted his penis into
her anus. Complainant cried and felt so much pain, but she kept the incident to ISSUE:
herself as her father might hurt her. A few days later, appellant again ravished
her. After removing his clothes, he asked her to lie on her side facing him and to
place her thigh over his. While in that position, appellant inserted his penis into
her vagina which caused tremendous pain. As in the first incident, complainant Whether or not appellant’s conviction should be upheld. (YES)
kept the ordeal to herself. It was only in November 1995 that she confided the
sexual abuses to her mother. On December 29, 1995, appellant again assaulted
her daughter. While leaning on the kitchen sink, he raised her t-shirt, fondled and
RULING:
kissed her breasts. He then removed their shorts, fondled her vagina and inserted
his penis, but when her brother Edwin went out of his room, appellant
This credibility given by the trial court to the rape victim is an important aspect
immediately asked her to dress up. The last sexual assault happened in the
of evidence which appellate courts can rely on because of its unique opportunity
afternoon of January 1, 1996. Appellant laid complainant down on the sofa then
to observe the witnesses, particularly their demeanor, conduct and attitude
placed himself on top of her and made pumping motion even with their shorts
during direct and cross-examination by counsel. It is likewise well established
on. Appellant stopped only when he heard the arrival of his wife.
that the testimony of a rape victim is generally given full weight and credit, more
so if she is a minor. The revelation of an innocent child whose chastity has been
On January 3, 1996, complainant and her mother visited a relative in Cainta, Rizal,
abused deserves full credit, as her willingness to undergo the trouble and the
who upon learning of the abuses done by the appellant, advised them to go to
humiliation of a public trial is an eloquent testament to the truth of her complaint.
Camp Crame where they filed a complaint. The Medico-Legal Officer at the PNP
In so testifying, she could only have been impelled to tell the truth, especially in
Crime Laboratory examined complainant and found her to have suffered deep
the absence of proof of ill motive.
healed hymenal lacerations and was in a non-virgin state.
Contrary to appellant's assertion, complainant's credibility was not diminished
Appellant denied the accusations against him. He testified that he married Maria
by her failure to report the sexual abuses to the authorities and her relatives
Loreto V. Dimaano on December 25, 1976 and begot three children with her,
despite opportunities to do so. Delay in reporting the rape incidents, especially in
namely, Edwin, Eric, and Maricar. He alleged that he worked in several companies
the face of threats of physical violence, cannot be taken against the victim, more
abroad but admitted that he was in the Philippines in September 1993. He
so when the lecherous attacker is her own father.
contended though that he could not have raped complainant because he was
always in the office from 7:00 a.m. until 9:00 p.m. waiting to be dispatched to
another assignment overseas.
Appellant's reliance on complainant's affidavit of desistance deserves scant
The trial court found the testimony of complainant to be spontaneous and
consideration. A survey of our jurisprudence reveals that the court attaches no
credible. She narrated the obscene details of her harrowing experience which no
persuasive value to a desistance, especially when executed as an afterthought.
girl of tender age would have known unless she herself had experienced it. It
The unreliable character of this document is shown by the fact that it is quite
found the delay in reporting the rape understandable due to the fear complainant
incredible that a victim, after going through the trouble of having the appellant
had of her father who had moral ascendancy over her. The court ordered him to
arrested by the police, positively identifying him as the person who raped her,
indemnify the victim the amount of P50,000.00 and to pay exemplary damages in
enduring the humiliation of a physical examination of her private parts, repeating
the amount of P50,000.00. The Court of Appeals affirmed the decision of the trial
her accusations in open court and recounting her anguish in detail, will suddenly
court.
turn around and declare that she is no longer interested in pursuing the case.

Under the above circumstances, we affirm the trial court's conviction in Criminal
Case Nos. 96-125 and 96-150 for the crimes of rape committed in September
1993 and on December 29, 1995. However, we acquit appellant in Criminal Case
No. 96-151 for the crime of attempted rape for failure to allege in the complaint Phil. Aeolus Automotive United Corporation v. NLRC
the specific acts constitutive of attempted rape.
FACTS: PAAUC is a corporation duly organized and existing under
Anent the awards of damages, the Court of Appeals correctly modified the awards
Philippine laws, petitioner Chua is its President while private respondent
of civil indemnity and exemplary damages, which the trial court lumped together
Rosalinda C. Cortez was a company nurse of petitioner corporation until her
for all the crimes committed, by separately awarding the sums of P50,000.00 and
termination on 7 November 1994. A memorandum was issued to Cortez
P75,000.00 as civil indemnity in Criminal Case Nos. 96-125 and 96-150,
respectively, and P25,000.00 as exemplary damages, for each count of rape, in requiring her to explain why no disciplinary action should be taken against her:
line with the prevailing jurisprudence.
(a) for throwing a stapler at Plant Manager William Chua, her
The award of civil indemnity, which is in the nature of actual or compensatory superior, and uttering invectives against him on 2 August 1994;
damages, is mandatory upon a conviction for rape. On the other hand,
exemplary damages is awarded when the commission of the offense is attended (b) for losing the amount of P1,488.00 entrusted to her by Plant
by an aggravating circumstance, whether ordinary or qualifying. Manager Chua to be given to Mr. Fang of the CLMC Department on
23 August 1994; and,
Finally, the awards of P50,000.00 and P75,000.00 as moral damages in Criminal
Case Nos. 96-125 and 96-150, respectively, by the Court of Appeals are also
(c) for asking a co-employee to punch-in her time card thus making it
sustained in line with the prevailing jurisprudence. The award of moral damages
is automatically granted in rape cases without need of further proof other than appear that she was in the office in the morning of 6 September 1994
the commission of the crime because it is assumed that a rape victim has actually when in fact she was not.
suffered moral injuries entitling her to such award.
The memorandum issued was refused by Cortez and while her case was
DISPOSITIVE PORTION: pending investigation the company placed her under preventive suspension for
thirty (30) days. While Cortez was still under preventive suspension, another
WHEREFORE , the decision of the Court of Appeals in CA-G.R. CR No.00263 memorandum was issued by petitioner corporation giving her seventy-two
affirming the decision of the Regional Trial Court of Paranaque City, Branch 257,
(72) hours to explain why no disciplinary action should be taken against her
in Criminal Cases Nos. 96-125 and 96-150, finding appellant Edgardo Dimaano
for allegedly failing to process the ATM applications of her nine (9) co-
GUILTY beyond reasonable doubt of the crime of rape committed against his own
employees with the Allied Banking Corporation. A third memorandum was
daughter, Maricar Dimaano, and sentencing him to reclusion perpetua and
DEATH, respectively; and ordering him to pay the complainant in Criminal Case issued to private respondent, this time informing her of her termination from
No. 96-125 the amounts of P50,000.00 as civil indemnity, P50,000.00 as moral the service. Cortez filed for illegal dismissal.
damages, and P25,000.00 as exemplary damages, and in Criminal Case No. 96-
150 the amounts of 75,000.00 as civil indemnity, P75,000.00 as moral damages, The Labor Arbiter held that the termination was valid and legal. The NLRC
and P25,000.00 as exemplary damages, is AFFIRMED. Appellant is however reversed and found petitioner corporation guilty of illegal dismissal of private
ACQUITTED for the crime of attempted rape in Criminal Case No. 96-151 for respondent Cortez.
failure of the complaint to allege the specific acts or omissions constituting the
offense. ISSUE: Whether Cortez was illegal dismissed and whether she is entitled to
damages in the event that the illegality of her dismissal is sustained.
G.R. No. 157718; April 26, 2005
RULING: YES, she was illegally dismissed. Respondent claims that plant
manager William Chua had been making sexual advances on her since her first
year of employment and that when she would not accede to his requests, he
threatened that he would cause her termination from service. She also claims
that money entrusted to her was not lost, but given to the personnel-in-charge
for proper transmittal as evidence by a receipt signed by the latter.
Furthermore, she explains that she asked someone to punch in her card as she
was doing an errand for one of the company’s officers and with the permission
of William Chua. Lastly, she asserts that she had no knowledge thereof. To
constitute serious misconduct to justify dismissal, the acts must be done in
relation to the performance of her duties as would show her to be unfit to
continue working for her employer.
The act of private respondent in throwing a stapler and uttering abusive
language upon the person of the plant manager may be considered, from a lay
man's perspective, as a serious misconduct. However, in order to consider it a
serious misconduct that would justify dismissal under the law, it must have
been done in relation to the performance of her duties as would show her to be
unfit to continue working for her employer. The acts complained of, under the
circumstances they were done, did not in any way pertain to her duties as a
nurse. Her employment identification card discloses the nature of her
employment as a nurse and no other. Also, the memorandum informing her
that she was being preventively suspended pending investigation of her case
was addressed to her as a nurse.
As regards the third alleged infraction, i.e., the act of private respondent in
asking a co-employee to punch-in her time card, although a violation of
company rules, likewise does not constitute serious misconduct. Firstly, it was
done by her in good faith considering that she was asked by an officer to
perform a task outside the office, which was for the benefit of the company,
with the consent of the plant manager. Secondly, it was her first time to commit
such infraction during her five (5)-year service in the company. Finally, the
company did not lose anything by reason thereof as the offense was
immediately known and corrected.
On the last alleged infraction, the money entrusted to her was in fact deposited
in the respective accounts of the employees concerned, although belatedly. The
negligence, to warrant removal from service, should not merely be gross but
also habitual. Likewise, the ground "willful breach by the employee of the trust
reposed in him by his employer" must be founded on facts established by the
employer who must clearly and convincingly prove by substantial evidence
the facts and incidents upon which loss of confidence in the employee may
fairly be made to rest. All these requirements prescribed by law and
jurisprudence are wanting in the case at bar.
She is also entitled to moral and exemplary damages. The gravamen of the
offense in sexual harassment is not the violation of the employee's sexuality
but the abuse of power by the employer. Any employee, male or female, may
rightfully cry "foul" provided the claim is well substantiated. Strictly speaking,
there is no time period within which he or she is expected to complain through
the proper channels. The time to do so may vary depending upon the needs,
circumstances, and more importantly, the emotional threshold of the
employee.
Private respondent admittedly allowed four (4) years to pass before finally
coming out with her employer's sexual impositions. Not many women,
especially in this country, are made of the stuff that can endure the agony and
trauma of a public, even corporate, scandal. If petitioner corporation had not
issued the third memorandum that terminated the services of private
respondent, we could only speculate how much longer she would keep her
silence. Moreover, few persons are privileged indeed to transfer from one
employer to another. The dearth of quality employment has become a daily
"monster" roaming the streets that one may not be expected to give up one's
employment easily but to hang on to it, so to speak, by all tolerable means.
Perhaps, to private respondent's mind, for as long as she could outwit her
employer's ploys she would continue on her job and consider them as mere
occupational hazards. This uneasiness in her place of work thrived in an
atmosphere of tolerance for four (4) years, and one could only imagine the
prevailing anxiety and resentment, if not bitterness, that beset her all that time.
But William Chua faced reality soon enough. Since he had no place in private
respondent's heart, so must she have no place in his office. So, he provoked
her, harassed her, and finally dislodged her; and for finally venting her pent-
up anger for years, he "found" the perfect reason to terminate her.
The bases of moral and exemplary damages are as follows: In moral damages,
it suffices to prove that the claimant has suffered anxiety, sleepless nights,
besmirched reputation and social humiliation by reason of the act complained
of. Exemplary damages, on the other hand, are granted in addition to, inter
alia, moral damages "by way of example or correction for the public good" if
the employer ''acted in a wanton, fraudulent, reckless, oppressive or
malevolent manner."
Anxiety was gradual in private respondent's five (5)-year employment. It
began when her plant manager showed an obvious partiality for her which
went out of hand when he started to make it clear that he would terminate her
services if she would not give in to his sexual advances. Sexual harassment
is an imposition of misplaced "superiority" which is enough to dampen
an employee's spirit in her capacity for advancement. It affects her sense
of judgment; it changes her life. If for this alone private respondent should
be adequately compensated. Thus, for the anxiety, the seen and unseen hurt
that she suffered, petitioners should also be made to pay her moral damages,
plus exemplary damages, for the oppressive manner with which petitioners
effected her dismissal from the service, and to serve as a forewarning to
lecherous officers and employers who take undue advantage of their
ascendancy over their employees.
WHEREFORE, the Decision of public respondent National Labor Relations
Commssion finding the dismissal of private respondent Rosalinda C. Cortez
to be without just cause and ordering petitioners Philippine Aeolus
Automotive United Corporation and/or Francis Chua to pay her back wages
computed from the time of her dismissal, which should be full back wages, is
AFFIRMED. However, in view of the strained relations between the adverse
parties, instead of reinstatement ordered by public respondent, petitioners
should pay private respondent separation pay equivalent to one (1) month
salary for every year of service until finality of this judgment. In addition,
petitioners are ordered to pay private respondent P25,000.00 for moral
damages and P10,000.00 for exemplary damages. Costs against petitioners.
Alvin Employo y Embada vs. People
Facts: Kristine Joy Mosquera was eight years old A grade III student, she was
walking to school at around seven oclock in the morning when she was met by
petitioner who emerged from hiding from a nearby store. Petitioner and Kristine
Joy were neighbors. Petitioner approached Kristine Joy, touched her head,
placed his hand on her shoulder where it then moved down to touch her
breast several times. Petitioner thereafter told Kristine Joy not to report to
anybody what he did to her.
This was not the first time that the incident happened as petitioner had done this
several times in the past, even when Kristine Joy was still in Grade II. However,
it was only during this last incident that Kristine Joy finally told somebody ' her
grandmother, who immediately talked to Gnelida Mosquera, Kristine Joy's
mother.
Mrs. Mosquera conferred with Kristine Joy who said that petitioner would
sometimes even insert his hand under her shirt to caress her breast. Mother and
child then reported the matter to the barangay. From the barangay, the case was
referred to the DSWD then to the Police Department of Subic, Zambales. Kristine
Joy was seen by a psychologist, witness Lucrecia Cruz, who reported that Kristine
Joy was a victim of sexual abuse and was showing unusual behavior as a result
thereof. Among other things, Ms. Cruz detected in the eight-year old child feelings
of insecurity, anger, anxiety and depression. Guilt feelings were also noted. All
in all, Kristine Joy appeared on the surface to be a child with normal behavior
despite the experience, but on a deeper level, she developed a fear of going to
school as petitioner might again be hiding in the store waiting for her. She was
deeply bothered during the interview and even uttered ' Nahihiya ako sa mga
magulang ko at uncle ko baka tuksuhin akong bobo na hindi ko agad sinabi.
Petitioner was charged with violation of Section 5(b), Article III of Republic Act
No. 7610. The trial court rendered its decision,
finding Alvin Amployo GUILTY beyond reasonable doubt of the crime of Child
Abuse defined under Section 5 (b) of Republic Act 7610 and hereby sentences
him to Reclusion Temporal in its medium period or FOURTEEN (14) YEARS,
EIGHT (8) MONTHS and ONE (1) DAY TO SEVENTEEN (17) YEARS and to pay the
costs. The CA affirmed the ruling of the Trial court with modifications as to the
penalty.
Issue: WON moral damages should be recovered
Ruling: YES.

We note that no award for moral damages was made by both the trial court and
the Court of Appeals despite the fact that the mental anguish suffered by Kristine
Joy on account of her harrowing experience is spread all over the records of the
case and has been well documented by the psychologist who examined her as
reflected in her report quoted above.
At the risk of being repetitive, proof of Kristine Joy's mental anguish, wounded
feelings and social humiliation finds an express outlet in her words: ' madumi na
ang sarili ko, nahihiya ako sa magulang ko at Uncle ko baka tuksuhin akong bobo
na hindi ko agad sinabi and ' ang masidhing ala-ala ng aking kamusmusan ay yong
panghihipo ni Tikboy. We therefore modify the ruling of the Court of Appeals by
awarding moral damages to Kristine Joy in the amount of Twenty Thousand
Pesos (P20,000.00) pursuant to Article 2219 of the Civil Code.
Additionally, we find relevant to discuss here the case of People v. Solmoro
wherein we declared that upon a finding of guilt of the accused for acts of
lasciviousness, the amount of P30,000.00 as moral damages may be further
awarded to the victim in the same way that moral damages are awarded to
victims of rape even without need of proof because it is assumed that they
suffered moral injury. Considering that the crime of acts of lasciviousness or
abusosdishonestos is necessarily included in rape and both cases involve
sexual assault albeit in different degrees, the rationale for foregoing with
proof of moral damages in rape cases applies with equal force to crimes of
acts of lasciviousness, the rationale being:
One other cognate development in the case law on rape
is applicable to the present disposition. The Court has also
resolved that in crimes of rape, such as that under
consideration, moral damages may additionally be awarded to
the victim in the criminal proceeding, in such amount as the
Court deems just, without the need for pleading or proof of the
basis thereof as has heretofore been the practice. Indeed, the
conventional requirement of allegata et probate in civil
procedure and for essentially civil cases should be dispensed
with in criminal prosecutions for rape with the civil aspect
included therein, since no appropriate pleadings are filed
wherein such allegations can be made.
Corollarily, the fact that complainant has suffered the
trauma of mental, physical and psychological sufferings which
constitute the bases for moral damages are too obvious to still
require the recital thereof at the trial by the victim, since the
Court itself even assumes and acknowledges such agony on
her part as a gauge of her credibility. What exists by
necessary implication as being ineludibly present in the
case need not go through the superfluity of still being
proved through a testimonial charade.
It does not end there. In People v. Abadies, and with respect specifically to
lascivious conduct amounting to child abuse under Section 5(b) of Rep. Act No.
7610, we imposed a fine of P30,000 for each count of lascivious conduct in
addition to the award of moral damages on the justification that '
It will be noted that Section 5, Article II of Republic Act
No. 7610 provides for the penalty of imprisonment.
Nevertheless, Section 31(f), Article XII (Common Penal
Provisions) thereof allows the imposition of a fine subject to the
discretion of the court, provided that the same is to be
administered as a cash fund by the Department of Social Welfare
and Development and disbursed for the rehabilitation of each
child victim, or any immediate member of his family if the latter
is the perpetrator of the offense. This provision is in accord with
Article 39 of the Convention on the Rights of the Child, to which
the Philippines became a party on August 21, 1990, which
stresses the duty of states parties to ensure the physical and
psychological recovery and social reintegration of abused and
exploited children in an environment which fosters their self-
respect and human dignity.
With the case of Abadies as guidepost, we impose a fine of Fifteen Thousand Pesos
(P15,000.00) on petitioner.
WHEREFORE, premises considered, the Resolution of the Court of Appeals
modifying the Decision of the Regional Trial Court of Olongapo City, Branch 72,
finding accused-petitioner ALVIN AMPLOYO y EBALADA alias 'TIKBOY guilty
beyond reasonable doubt of violation of Republic Act No. 7610, and sentencing
him to suffer the penalty of twelve (12) years and one (1) day of reclusion
temporal, as minimum, to fifteen (15) years, six (6) months and twenty (20) days
of reclusion temporal, as maximum is AFFIRMED with the MODIFICATION that
petitioner is hereby ordered to pay a fine of Fifteen Thousand Pesos (P15,000.00)
and moral damages in the amount of Twenty Thousand Pesos (P20,000.00). No
costs.
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. HONORIO G. MABUNGA,
accused-appellant.
G.R. No. 96441, SECOND DIVISION, November 13, 1992, REGALADO, J.
FACTS: In a complaint, accused-appellant Honorio G. Mabunga y Gulog was
charged with the crime of rape against his own daughter and trial thereafter
proceeded upon a plea of not guilty entered by appellant at his arraignment.
On January 20, 1984, Benilda Mabunga was sent by her husband,
Honorio(appellant) herein on an errand to Malabon to get the papers he needed
for going abroad. Appellant was a security guard assigned to the night shift.
Benilda left their house in Bagong Silang, Caloocan City at around 9:30 A.M.
leaving behind appellant and their children, the thirteen-year-old complainant
and six-year old Chennelyn.
At around 10:00 A.M., appellant told Chennelyn to go out and play. As soon as
complainant was left alone with appellant (her father) in their one-room house,
appellant told complainant to take off her clothes and that if she would not do it,
he would kill her. He pointed a knife on her neck and told her to lie on the floor.
When complainant had already lain down, he took off her skirt, her upper
garment, and her panty and told her not to tell anybody especially her mother
about what he was doing. Appellant then took off his own clothes, pants and brief,
went on top of complainant while pointing the knife on her neck, inserted his
penis into her private part and kissed her while she cried. While the appellant
was on top of complainant, the lower part of his body went up and down and
stopped when his semen spouted out. After the sexual intercourse, appellant told
complainant who was still crying to dress up and not to tell her mother about it
or else he would kill them all.
When her mother arrived, complainant did not tell her what happened because
appellant was in the house. Appellant told his wife that he would bring
complainant to his place of work at the Airport Motel, Baclaran so that she could
wash his clothes and cook for him. Complainant went with him that same
afternoon.
In the evening of that same day, at around 8:00 p.m., complainant was again raped
by appellant, this time at the guardhouse of the Airport Motel where he made the
complainant lie down. Complainant stayed with appellant in the guardhouse of
the Airport Motel, Baclaran where she washed his clothes and cooked for him.
During her stay with the appellant at the guardhouse, she was repeatedly raped
by him but she could not resist because he kept threatening her that he would
maul her or hurt her bodily.
On July 7, 1986, complainant left the guardhouse after appellant told her that he
was going to impregnate her. Before she left, however, she wrote a letter
addressed to her mother stating that she had to leave their house because she
would be raped again by appellant who told her that they would live together in
Batangas. She placed the letter inside the bag of her mother when the latter went
to the Airport Motel although her mother testified that complainant placed this
letter inside her bag when she was in their house.
Complainant took a bus where she befriended an old woman by the name of Aling
Florencia. The latter asked her what was her problem as she was crying. After
complainant related to Aling Florencia what her own father had done to her, Aling
Florencia invited complainant to live with her in Novaliches. Complainant stayed
in the house of Aling Florencia until July 31, 1986, when she asked permission to
go home.
When complainant arrived at their house in Bagong Silang on July 31, 1986, her
mother told her that they were going to Diliman, Quezon City to the house of her
mother's brother, Felimon Java, who was a policeman. Her mother had found the
letter which complainant placed in her bag and had confronted appellant about
the matter. Appellant first admitted having raped complainant but later denied
it.
After complainant told her uncle, Felimon Java, what happened, they went to the
police station. There, complainant filed a complaint for rape against appellant. On
the same day, the Quezon City Police referred her to the National Bureau of
Investigation (NBI) where she underwent a physical examination.
Dr. Alberto M. Reyes, a supervising medico-legal officer at the NBI, examined
complainant. Dr. Reyes testified that his most important finding was that
complainant's genital organ had an "old healed deep laceration" which meant
that the hymen, the membrous covering of the vaginal canal, had been lacerated
and the laceration was inflicted a long time ago which could be more than six (6)
months ago and that she has experienced repeated sexual intercourse because
the vaginal walls were lax and the rugosities were shallow.
The trial court rendered a decision convicting appellant of two crimes of rape,
one committed in Caloocan City and the other at the guardhouse of the Airport
Motel in Baclaran. Appellant seasonably filed an urgent motion for
reconsideration and/or new trial. In an order, the court modified its decision in
that all the findings reached by the Court with respect to the second offense of
rape committed in the guardhouse, at the Airport Motel and the judgment
rendered therein convicting the accused on said second rape, are set aside.
ISSUE: Whether or not civil indemnity should be awarded.
RULING: YES. The contention of appellant that there was insufficient evidence of
resistance on the part of the victim against the sexual assaults against her is
untenable. In her testimony, complainant narrated that appellant threatened to
kill her and poked a knife at her as he was abusing her and this indisputably
constitutes sufficient intimidation. This Court has repeatedly ruled that
intimidation includes the moral kind, such as the fear caused by threatening the
girl with a knife or pistol.
Moreover, in the cases of rape, the manner, form and tenacity of resistance of the
victim therein are dependent on a number of factors, among which are the age
and size of the victim, as well as the aggressor himself; the degree of actual force
and intimidation employed; and, of utmost importance, the relationship between
the rapist and the prey.
In the instant case, the victim at the time of the incident was a mere thirteen-year
old girl and the one who raped her was her own father. Hence, even assuming
that force or intimidation had not been actually employed, the crime of rape was
nevertheless committed. The absence of violence or offer of resistance would not
be significant because of the overpowering and overbearing moral influence of
the father over the daughter which takes the place of violence and offer of
resistance required in rape cases committed by an accused having no blood
relationship with the victim.
We have ruled in a number of cases that inconsistencies in the testimony of
prosecution witnesses with respect to minor details and collateral matters do not
affect the substance of their declaration, their veracity, or the weight of their
testimony. In fact, these inconsistencies, if only in minor details, reinforce rather
than weaken their credibility.
In the present case, the alleged flaws or discrepancies in the testimony of the
complainant are on the minor details which do not destroy the substance of her
testimony or the other circumstances that point unerringly to the guilt of
appellant.
Complainant's failure to state that there was bleeding in her vagina is immaterial.
Vaginal bleeding or virginity is not an element in rape. What is important is the
victim's testimony that appellant sexually abused her. When a victim says that
shed had been raped, she says in effect all that is necessary to show that rape has
been committed and if her testimony meets the test of credibility, the accused
may be convicted on the basis thereof.
The fact that complainant, after the first rape, still went with appellant to the
guardhouse of the Airport Motel when she was repeatedly raped by him and left
the place only in 1986, does not affect her trustworthiness. She was only thirteen
years old and dependent upon her parents for sustenance, not to speak of
appellant's unquestionable moral ascendancy over her. She had no option but to
go with appellant when ordered to do so. Aside from that, there was that
continuing threat by appellant against her life and the lives of the other members
of her family, the fear of which was ingrained in her consciousness.
Consequently, the failure of the complainant to immediately report the incident
to the authorities does not cast doubt on the credibility of the charge, since the
foregoing circumstances satisfactorily explain the unintended delay. One should
not expect such a young girl to act like an adult or like a mature and experienced
woman who would know what to do under the such difficult circumstances, and
who would have the courage and intelligence to disregard a threat on her life and
the members of her family and complain immediately that she had been forcibly
deflowered.
Incestuous rape of a daughter by a father has heretofore always been bitterly and
vehemently denounced by this Court as more than just a shameful and shameless
crime. And, as we recently reiterated, rape is a nauseating crime that deserves
the condemnation of all decent persons who recognize that a woman's cherished
chastity is hers alone to surrender of her own free will. Whoever violates that
will descends to the level of the odious beast. The act becomes doubly
repulsive where the outrage is perpetrated by one's own flesh and blood for the
culprit is reduced to lower than the lowly animal, and forfeits all respect as a
human being.
The execrable crime of herein appellant is made more odious by the total lack of
remorse or even a penitential gesture on his part. It displays the nadir to which
the beast in man can sink. Such a transgressor of basic human norms of conduct
does not deserve to live in a decent human society, and that society has the right
to exclude from its membership anyone cursed with such an atavistic and
subhuman propensity.
On the foregoing considerations and in the light of the present law in force, we
uphold the findings and conclusions of the lower court. We note, however, that it
failed to award civil indemnity to the offended party as provided by Article 345
of the Revised Penal Code. Accordingly, accused-appellant is hereby further
ordered to indemnify the offended party which, under the circumstances of
this case, should be in the amount of P40,000.00 in accordance with the
current policy of the Court.
DISPOSITIVE PORTION:
WHEREFORE, with the modification above indicated, the amended judgment of
the court a quo is hereby AFFIRMED. SO ORDERED.
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. SIMEON SUYAT y JOSE,
accused-appellant. | G.R. No. 173484, THIRD DIVISION, March 20, 2007,
CHICO-NAZARIO, J.
FACTS:
On May 7, 2003, twenty-eight (28) year old AAA, widow with two children, was
alone in her house at Barangay Baro, Asingan, Pangasinan, preparing to go to bed
for the night. Her children were with her mother (BBB) who settled in a house
close by. At about 7:00 that evening, while lying on her bamboo bed, appellant,
Simeon Suyat, entered the house and turned out the lamp. In an instant, appellant
poked a knife on the victim’s side, clamped shut her mouth with the palm of his
left hand, and then threatened her not to speak.
AAA immediately recognized sixty (60) year old appellant who is her mother’s
live-in partner. Withdrawing his hand from her mouth, appellant reached down,
raised the victim’s skirt, grabbed and pulled her under garment all the way down
her legs, then got on top of her. Appellant parted her legs with his own. He
loosened his short pants and guided his penis to the victim’s organ. AAA felt
appellant’s penis penetrate her vagina. Appellant made push and pull
movements. After a while, the knife eased off from her side.
Finding an opportunity to escape, AAA courageously shoved appellant off on top
of her, ran outside, and shouted for help. Her mother, BBB, chanced upon her
outside the house and asked what happened. AAA, distressed, told her mother
the harrowing incident she experienced at the hands of the appellant. Her mother
told her to keep the ‘scandalous’ matter a secret between themselves. Committed
to obtain justice though, AAA reported the incident to the police authorities the
morning after.
AAA decided to file a rape case against the appellant.
The victim went to Region I, Medical Center in Dagupan City, where she was
examined by Dr. May Gwendolyn Luna. Dr. Luna noted some reddish
discoloration at the posterolateral area of the labia minora which is secondary to
scratch or friction.
Accused-appellant, in his defense, claimed that at around 7:00 o’clock in the
evening of 7 May 2003, he was watching television in the house of BBB. He was
there together with BBB and AAA’s children. Suddenly, AAA went inside BBB’s
house and said, “I want to have sex tonight.” Thinking that the remark was
directed at him, he replied, “you go because that is what you are doing.” AAA
allegedly retorted, “maniakis ka nga lakay.” Not wanting to let AAA have the last
word in their exchange, he told AAA, “you are a sex maniac because you are not
contended with only one penis.” After this, BBB held him and led him out to the
gate and he went to his own house located about 100 meters away. He returned
later in the evening and slept beside BBB.
The trial court declared accused-appellant guilty as charged and is hereby order
to pay the victim ₱50,000 as civil indemnity and ₱50,000 as moral damages.
The Court of Appeals affirmed the decision of the trial court in toto.
ISSUE/S:
1. W/N the accused-appellant is guilty of rape. (YES)
 2. W/N the accused-appellant is liable to pay civil indemnity and moral
damages. (YES)
RULING:
W/N the accused-appellant is guilty of rape.
YES.
It is doctrinally settled that findings of the trial court as regards the credibility of
witnesses will not be disturbed on appeal the rationale being that the trial court
enjoys the singular privilege of observing firsthand the demeanor of the
witnesses as they are subjected to intense examinations by lawyers and even the
court. Thus, unless it is shown that the trial court overlooked, misunderstood, or
misapplied some facts or circumstances, weight and substance which could have
affected the outcome of the case, we are bound to affirm their findings.33 In rape
cases specifically, the credibility of the complainant is of paramount importance
as oftentimes her testimony, when it satisfies the test of credibility, may be the
sole basis for an accused’s conviction. In People v. Tismo, the court ruled that the
culpability of the offender almost invariably hinges on the story of the
complainant. In the light of the presumption of innocence that the accused enjoys,
the complainant’s testimony must perforce be carefully scrutinized and
examined to satisfy the judicial conscience that the accused did in fact commit the
crime. Her testimony should not be received with precipitate credulity, especially
when the conviction depends at any vital point upon her uncorroborated
testimony, it should not be accepted unless her sincerity and candor are free from
suspicion. Such testimony must be impeccable and ring true throughout, or
credible and positive. Clearly, therefore, as in other criminal cases, the evidence
for the prosecution in rape cases must stand or fall on its own merits; it cannot
be allowed to draw strength from the weakness of the evidence for the defense.
The court have scrutinized the records of this case and found nothing that could
convince us to overturn accused-appellant’s conviction. The court agree in the
trial court’s observation that AAA’s retelling of her harrowing experience in the
hands of accused-appellant was positive, straightforward, spontaneous, and
unadorned. She was able to narrate in an even more detailed manner how she
was raped. The rule is that when a rape victim’s testimony is straightforward and
candid, unshaken by rigid cross-examination and unflawed by inconsistencies or
contradictions in its vital points, the same must be given full faith and credit.
W/N the accused-appellant is liable to pay civil indemnity and moral damages.
YES. The award of P50,000.00 as civil indemnity and another P50,000.00 as
moral damages is proper for it is settled that, that these two are distinct from one
another. As the court explained in People v. Caratay:
“x x x an award of P50,000.00 as civil indemnity is mandatory upon
the finding of the fact of rape. This is exclusive of the award of moral
damages of P50,000.00, without need of further proof. The victim’s
injury is now recognized as inherently concomitant with and necessarily
proceeds from the appalling crime of rape which per se warrants an
award of moral damages.”
DISPOSITIVE PORTION:
WHEREFORE, premises considered, the Decision dated 24 May 2006 of the Court
of Appeals in CA-G.R. CR No. 00997, affirming, in toto, the Decision of the Regional
Trial Court of Urdaneta City, Branch 46 is hereby AFFIRMED. No costs. SO
ORDERED.
- SAB
2. In acts and actions referred to in Articles 21, 26, 27, 28, 30, 32, 34 &
35, New Civil Code
Helleo
FERNANDO LOPEZ, ET AL., plaintiffs-appellants,vs. PAN AMERICAN WORLD
AIRWAYS, defendant-appellant.
G.R. No. L-22415, EN BANC, March 30, 1966, BENGZON, J.P., J.
FACTS:
Reservation for first class accommodation in Pan American Airlines from Tokyo
to San Francisco was made by Delfin Faustino for then Senator Fernando Lopez
and company. First class tickets were issued and paid for. The party left Manila
for Tokyo as scheduled. Senator Lopez requested Minister Busuego to contact the
airlines regarding their accommodation. However, they were informed that there
was no accommodation for them. Because of some urgent matters to attend to in
San Francisco, they were constrained to take the tourist flight “under protest”
ISSUES:
(1) Whether the defendant acted in bad faith for deliberate refusal to comply
with its contract to provide first-class accommodation to the plaintiff
(2) Whether moral and exemplary damages should be awarded
RULING:
(1) YES. From the evidence of defendant it is in effect admitted that defendant -
through its agents - first cancelled plaintiffs, reservations by mistake and
thereafter deliberately and intentionally withheld from plaintiffs or their travel
agent the fact of said cancellation, letting them go on believing that their first class
reservations stood valid and confirmed. In so misleading plaintiffs into
purchasing first class tickets in the conviction that they had confirmed
reservations for the same, when in fact they had none, defendant wilfully and
knowingly placed itself into the position of having to breach its a foresaid
contracts with plaintiffs should there be no last-minute cancellation by other
passengers before flight time, as it turned out in this case. Such actuation of
defendant may indeed have been prompted by nothing more than the promotion
of its self-interest in holding on to Senator Lopez and party as passengers in its
flight and foreclosing on their chances to seek the services of other airlines that
may have been able to afford them first class accommodations. All the time, in
legal contemplation such conduct already amounts to action in bad faith. For bad
faith means a breach of a known duty through some motive of interest or ill-will.
At the time plaintiffs bought their tickets, defendant, therefore, in breach of its
known duty, made plaintiffs believe that their reservation had not been cancelled.
Such willful-non-disclosure of the cancellation or pretense that the reservations
for plaintiffs stood - and not simply the erroneous cancellation itself - is the factor
to which is attributable the breach of the resulting contracts. And, as above-
stated, in this respect defendant clearly acted in bad faith.
(2) YES. First, then, as to moral damages. As a proximate result of defendant's
breach in bad faith of its contracts with plaintiffs, the latter suffered social
humiliation, wounded feelings, serious anxiety and mental anguish. For plaintiffs
were travelling with first class tickets issued by defendant and yet they were
given only the tourist class. At stop-overs, they were expected to be among the
first-class passengers by those awaiting to welcome them, only to be found
among the tourist passengers. It may not be humiliating to travel as tourist
passengers; it is humiliating to be compelled to travel as such, contrary to what
is rightfully to be expected from the contractual undertaking.
The rationale behind exemplary or corrective damages is, as the name implies, to
provide an example or correction for public good. Defendant having breached its
contracts in bad faith, the court, as stated earlier, may award exemplary damages
in addition to moral damages. In view of its nature, it should be imposed in such
an amount as to sufficiently and effectively deter similar breach of contracts in
the future by defendant or other airlines. In this light, we find it just to award
P75,000.00 as exemplary or corrective damages.
-Rochelle
AGAPITO MAGBANUA, INENIAS MARTIZANO, CARLITO HERRERA, SR.,
PAQUITO LOPEZ, AND FRANCISCO HERRERA, petitioners, vs. HON.
INTERMEDIATE APPELLATE COURT (SECOND SPECIAL CASES DIVISION),
EDUARDO, BUTCH, DIEGO AND NENA All Surnamed PEREZ, respondents.
G.R. Nos. L-66870-72 June 29, 1985
FACTS:
The plaintiffs filed a petition against the respondents all surnamed Perez alleging
that they are shared tenants of the defendants, and that the latter divert the flow
of water from their farm lots which caused the drying up of their landholdings
and asked to vacate their areas for they could not plant palay due to lack of water.
The trial court rendered a decision in favor to the plaintiffs and ordered the
defendants to pay moral and exemplary damages to the plaintiffs. The defendants
appealed to the IAC which the latter affirmed the appeal by deleting the award of
moral and exemplary damages to be awarded to the plaintiffs. Upon the
reinstatement of the IAC, the trial court did not agree to the appellate court in its
decision because the former believe that as a shared tenants, they are entitled to
be maintained as agricultural lessees in peaceful cultivation in their respective
landholdings.
In this petition, the prayer is for the reinstatement of the moral and exemplary
damages and the attorney's fees which had been awarded by the trial court on
the ground that the Intermediate Appellate Court committed a grave abuse of
discretion in eliminating them.
In awarding damages and attorney's fees, the trial court said:
This Court has likewise noted the manifestation submitted by
plaintiffs on June 3, 1982 wherein they have attached
photographs of their dried-up landholdings and wilted palay
crops. The allegations in this pleading and the accompanying
pictures were never rebutted by the defendants.
In view of this circumstances, this Court holds the opinion that
between the period of the inspection by the PC Team on
February 24, 1982 and June 13, 1982 when plaintiffs'
manifestation was filed, there has been complete closure of
water supplying plaintiffs' landholdings which resulted to the
drying up of the same that greatly hampered the healthy growth
of the palay crop. This Court does not believe that the disruption
of the water supply which led to the very poor harvest is due to
the fault/negligence of the plaintiffs.
Plaintiffs have all their legal rights to protect their interests
under the law in filing these cases, for what the defendants have
done to them, and as such they are entitled attorney's fees.
Upon the other hand, the Intermediate Appellate Court deleted the award of
moral and exemplary damages, as well as attorney's fees. There is no evidence
showing that, in dealing with plaintiffs, defendants acted fraudulently or in bad
faith. There is no showing either that attorney's fees are recoverable under Art:
2208, Civil Code.
ISSUE:
WON the tenants of defendants were entitled to moral and exemplary damages.
RULING:
Under the facts of the case, the petitioners are entitled to a measure of moral
damages. Article 2219 of the Civil Code permits the award of moral damages for
acts mentioned in Article 21 of the same code and the latter stipulates that: "Any
person who wilfully causes loss or injury to another in a manner that is contrary
to morals, good customs or public policy shall compensate the latter for the
damage."
It appears that the petitioners were denied irrigation water for their farm lots in
order to make them vacate their landholdings. The defendants violated the
plaintiffs' rights and caused prejudice to the latter by the unjustified diversion of
the water.
The petitioners are also entitled to exemplary damages because the defendants
acted in an oppressive manner. (See Art. 2232. Civil Code.)
It follows from the foregoing that the petitioners are also entitled to attorney's
fees but the size of the fees as well as the damages is subject to the sound
discretion of the court.
WHEREFORE, the petition is granted; the decision under review is modified and
each of the plaintiffs is entitled to the following to be paid by the defendants
jointly and severally:
Moral damages — P1,000.00
Exemplarly damages — 500.00
Attorney's fees — 1,000.00
P2,500.00
PACIFIC AIRWAYS CORPORATION, ARQUE MAMING and JORBIN
TOLENTINO, petitioners,
vs.
JOAQUIN TONDA, respondent.
G.R. No. 138478 November 26, 2002 CORONA, J.
FACTS:
On January 11, 1991, plaintiff [Respondent], Joaquin Tonda, purchased from
defendant Pacific Airways Corporation through its travel agent Valderama Travel
and Tours, Inc. a package tour for a party of nine consisting of round trip airfares
to, transfers to and from defendant corporation’s airstrip at Caticlan, Malay,
Aklan and accommodation and breakfast at Boracay, Malay, Aklan. Two receipts
were issued which the travel agency advised would entitle the members of the
tour package to avail of the above stated services/accommodation. On January
18, 1991, with the receipts, plaintiff, his wife, 3 kids, a nanny, two brothers-in-
law, and a sister-in-law flew to Boracay via defendant-corporation’s aircraft.
Plaintiff and party stayed in Boracay up to January 21, 1991. In the morning of
January 21, 1991, plaintiff and party, along with other guests, left Boracay on
board bancas provided by defendant corporation and on reaching a certain point,
they alighted and boarded tricycles that look them to defendant corporation’s
airstrip at nearby Caticlan. They arrived at the airstrip at around 9:30 a.m. during
which the incident that gave rise to the present complaint took place.
After plaintiff and his party arrived at the airstrip and while their luggages were
being unloaded from the tricycles, passengers informed them that they should
weigh themselves. Heeding the advice, plaintiff’s wife Mrs. Tina Marie Tonda
repaired to a nipa structure-office where the weighing scale was located. While
she was weighing herself, defendant corporation’s employee, Archimedes
‘Arque’, naming one of the defendants herein, shouted at Mrs. Tonda, telling her
something which was not clearly heard by plaintiff as he was unloading luggages
from the tricycles. Plaintiff later asked his wife what transpired inside the hut and
she related that Maming shouted at her to hurry up as there were many
passengers who would also take their weight, and that she replied by saying
‘please, when you talk to me, talk to me in a nicer manner.’ Plaintiff and the other
members of his party also went inside the hut to get their weight. Later, as
plaintiff and his party were about to board the 19-seater aircraft that would carry
16 passengers, defendant Maming approached Mrs. Tonda and asked for their
tickers. Mrs. Tonda obliged by giving him the receipts issued by the travel agency,
but defendant Maming shouted at her, telling her that those were not tickets. Mrs.
Tonda answered back, saying that those were the receipts that served as their
tickets when they left Manila. Plaintiff then butted in and told Maming ‘You don’t
have to talk to my wife like that.’ Maming, who seemed to be very nervous, pushed
plaintiff, telling him ‘You don’t have bulls (sic), do you?’, prompting plaintiff to
push back Maming. Suddenly, Jorvin Tolentino, defendant corporation’s
employee and also one of the defendants herein, who was behind plaintiff,
appeared at plaintiff’s right side and punched him at the right eye causing it to
bleed. Maming who was in front of plaintiff then slashed plaintiff’s left shoulder
with a sharp pointed instrument which could have been a ballpen causing it to
bleed and leave a scar measuring 4 inches by 12 centimeters and plaintiff to fall
down. The other passengers who then intervened took Maming and Tolentino
away. Plaintiff immediately aired a verbal complaint at defendant corporation’s
office, which, however, gave him no medical treatment. On arrival in Manila,
plaintiff related the incident to, and sought medical treatment at defendant
corporation’s office but he was not extended any although he was advised to file
a formal complaint so it could be investigated. Plaintiff thus sought medical
attendance at the Ayala Alabang Village Association Clinic.
On 23 December 1993, the trial court rendered its decision in favor of respondent
Tonda and awarded him actual, moral and exemplary damages, plus attorney’s
fees to wit: 1. P1,000.00 as and for actual damages; 2. P100,000.00 as and for
moral damages; 3. P50,000.00 as and for exemplary damages; 4. P50,000.00 as
and for attorney’s fees.
On appeal, the Court of Appeals affirmed the decision of the trial court
ISSUE:
WHETHER OR NOT THE HONORABLE COURT OF APPEALS PATENTLY
ERRED IN DISMISSING PETITIONER’S APPEAL AND DENYING THEIR MOTION
FOR RECONSIDERATION
RULING:
The petition is unmeritorious.
Time and again, this Court has stressed that our jurisdiction in a petition for
review on certiorari under Rule 45 is limited to reviewing only errors of law, not
of fact, unless the findings of fact complained of are devoid of support by the
evidence on record, or the assailed judgment is based on the misapprehension of
facts. The trial court, having heard the witnesses and observed their demeanor
and manner of testifying, is in a better position to decide the question of their
credibility. Hence, the findings of the trial court must be accorded the highest
respect, even finality, by this Court.
In the case at bar, there is no reason to deviate from this rule inasmuch as the
findings of fact by the courts a quo are supported by the evidence and records of
the case. The errors imputed by the petitioners require an inquiry into the
appreciation of evidence by the trial court which this Court cannot do on a
petition for review on certiorari under Rule 45 of the Rules of Court. Besides, this
Court has already ruled that the finding of negligence is a question of fact which
it cannot look into anew, without any showing that the case falls under the
exceptions to the well-established rule that this Court is not a trier of facts.
Hence, we affirm the decision of the courts a quo that petitioner PACO is liable for
the negligence of its employees, co-petitioners Maming and Tolentino, pursuant
to Article 2180, in connection to Article 2176 of the Civil Code. In fact, the finding
of mere negligence on the part of petitioner’s employees is too kind to accurately
describe what really happened on January 21, 1999 to respondent and his family.
The treatment accorded respondent and his wife by petitioner PACO’s employees
was characterized by a certain viciousness and meanness which the businessman
did not deserve. This kind of bad conduct, not to mention petitioner PACO’s utter
lack of interest in or concern for what happened, respondent’s medical condition
and extrajudicial demand for reimbursement and damages, reflects the terrible
kind of service philosophy or orientation subscribed to by petitioners. Any
liability arising from such substandard service orientation must therefore be
borne by them.
Respondent proved that he incurred actual damages of P1,000 for the treatment
of the wounds inflicted by petitioners Maming and Tolentino. The fact that he
suffered injuries which required him to seek medical attention at the Ayala
Alabang Village Clinic and at the Makati Medical Center remains
uncontroverted16 and is thus deemed admitted. He is also entitled to moral
damages pursuant to Article 2219 (2)17 of the Civil Code inasmuch as the
petitioner’s tortious acts certainly caused physical injuries and undue
embarrassment. Exemplary damages are also recoverable as it is imposed by way
of example or correcting for the public good, in addition to moral, temperate,
liquidated or compensatory damages, and for acting in a wanton, fraudulent,
reckless, oppressive and malevolent manner.18 Petitioner Maming’s acts of
uttering vulgar words, and pushing and scratching respondent with a ballpen,
and petitioner Tolentino’s act of punching respondent (a paying customer) in the
eye and injuring it, were shameless and reprehensible and therefore "wanton,
reckless and oppressive acts" which justify the award of such damages.
Respondent is also entitled to attorney’s fees as he was forced to litigate to
protect his rights19 when his extrajudicial demand for damages from petitioner
PACO was ignored.
In view of the foregoing, we affirm the award by the courts a quo of P100,000 as
moral damages, in the light of the injuries, humiliation and harrowing experience
of respondent. No customer, especially a businessman like respondent, deserves
to be screamed at, pushed and slashed with a ballpen by the company’s
employees, especially those of service-oriented companies like petitioner PACO
which offers its services precisely to ensure a hassle-free vacation for its
customers. Because of the particular obnoxiousness of petitioners’ behavior,
exemplary damages are increased to P100,000.
Philippine Savings Bank vs. Mañalac
PHILIPPINE SAVINGS BANK v. SPS. RODOLFO C. MAÑALAC, JR. and ROSITA
P. MAÑALAC
[G.R. NO. 145441. April 26, 2005, YNARES-SANTIAGO, J.]
FACTS:
Spouces Mañalac obtained a P1,300,000.00 loan from PSBank. As security for the
loan, Mañalac executed a Real Estate Mortgage in favor of the bank over 8 parcels
of land covered by TCT Nos. A, B, C, D, E, F, G and H.
In view of Mañalac's inability to pay the loan installments as they fell due, their
loan obligation was restructured on October 13, 1977. Accordingly, Mañalac
signed another PN for P1,550,000.00. To secure the payment of the restructured
loan, Mañalac executed a Real Estate Mortgage in favor of PSBank over the same
aforementioned 8 real properties.
On March 5, 1979, Mañalac and spouses Igmidio and Dolores Galicia, with the
prior consent of PSBank, entered into a Deed of Sale with Assumption of
Mortgage involving 3 of the mortgaged properties covered by TCT Nos. F
(now F-1), N-E (now TCT No. E-1), and G (now TCT No. G-1).
Thereafter, the 3 parcels of land purchased by the Galicias, together with another
property, were in turn mortgaged by them to secure a P2,600,000.00 loan which
they obtained from PSBank. Specifically, the mortgaged properties include
TCT Nos. F-1, E-1, G-1, (formerly TCT Nos. F, E and G, respectively) and I.
On March 12, 1979, Mañalac paid PSBank P919,698.11 which corresponds to the
value of the parcels of land covered by TCT Nos. F-1, E-1, and G-1, now registered
in the name of the spouses Galicia. Accordingly, PSBank executed a partial release
of the real estate mortgage covered by the aforesaid properties.
On August 25, 1981, the spouses Galicia obtained a second loan from PSBank in
the amount of P3,250,000.00. They also executed a Real Estate Mortgage in
favor of the bank covering TCT Nos. F-1, E-1, G-1, I and J.
Since Mañalac defaulted again in the payment of their loan installments and
despite repeated demands still failed to pay their past due obligation which now
amounted to P1,804,241.76, PSBank filed a petition for extrajudicial
foreclosure of their 5 remaining mortgaged properties, specifically those
covered by TCT Nos. A, B, C, B, D, and H.
Despite several postponements of the public auction sale, Mañalac still failed to
pay their mortgage obligation. Thus, on May 3, 1982, the foreclosure sale of the
subject real properties proceeded with PSBank as the highest bidder.
Certificate of Sale was issued.
Mañalac failed to redeem the properties hence titles thereto were consolidated
in the name of PSBank and new certificates of title were issued in favor of the
bank, namely, TCT No. H-2 in lieu of TCT No. H; TCT No. A-2 in lieu of TCT No.
A; TCT No. D-2 in lieu of TCT No. D; TCT No. C-2 in lieu of TCT No. C; and TCT
No. B-2in lieu of TCT No. B.
On December 16, 1983, Mañalac wrote the Chairman of the Board of PSBank
asking information on their request for the partial release of the mortgage
covered by TCT Nos. F-1, E-1, G-1, and A (now TCT No. A-2). TCT Nos. 36192,
36193, and 36194 were registered in the name of the Galicias, and
mortgaged to partially secure their outstanding loan from the bank.
Enclosed in the same letter is a Cashier's Check for P1,200,000.00
Upon receipt of the check, PSBank's Acting Manager Lino L. Macasaet issued a
typewritten receipt with the inscription:
Received from Sps. Rodolfo and Rosita Mañalac and Sps. Igmidio and
Dolores Galicia PCIB Check No. 002133 in the amount of One Million Two
Hundred Thousand Pesos Only (P1,200,000.00).
It is understood however, that receipt of said check is not a commitment
on the part of the Bank to release the Four (4) TCTs requested to be
released on your letter dated 19 December 1983.
On December 19, 1983, the bank applied P1,000,000.00 of the P1,200,000.00 to
the loan account of the Galicias as payment for the arrearages in interest and the
remaining P200,000.00 thereof was applied to the expenses relative to the
account of Mañalac.
On May 23, 1985, the bank sold the property to third persons
Thereafter, or on October 20, 1986, Mañalac instituted an action for damages. The
bank also filed a petition for the issuance of a writ of possession and the ejectment
of the respondents.
The trial court consolidated the cases and ruled for the annulment of Sale
executed by defendant PSB in favor of third persons. And dismissed the petition
for the issuance of a writ of possession and the ejectment of the respondents for
lack of merit.
The Court of Appeals affirmed with modification the decision of the trial court,
the decretal portion of which reads:
WHEREFORE, the decision appealed from is AFFIRMED with the
modification that the defendant-appellant Philippine Savings Bank is
directed to indemnify the plaintiffs-appellants in the amount of
Two Hundred Thousand Pesos (200,000.00) each as moral
damages. Costs against the defendant-appellant bank.
ISSUE: Whether or not CA erred in awarding the amount of moral damages in
favor of Mañalacs?
RULING:
Qualified. Rosita Mañalac has adequately established the factual basis for
the award of moral damages. However, Rodolfo Mañalac is not similarly
entitled to moral damages.
We however sustain the award of moral damages. While the bank had the legal
basis to withhold the release of the mortgaged properties, nevertheless, it was
not forthright and was lacking in candor in dealing with Mañalac. In accepting
the PCIB Check, the bank knew fully well that the payment was conditioned
on its commitment to release the specified properties. At the first instance,
the bank should not have accepted the check or returned the same had it
intended beforehand not to honor the request of Mañalac. In accepting the
check and applying the proceeds thereof to the loan accounts of Mañalac
and Galicia, the former were led to believe that the bank was favorably
acting on their request. In justifying the award of moral damages, the Court of
Appeals correctly observed that "there is the unjustified refusal of the
appellant bank to make a definite commitment while profiting from the
proceeds of the check by applying it to the principal and the interest of the
Galicias and plaintiff-appellants."
Moral damages are meant to compensate the claimant for any physical suffering,
mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings,
moral shock, social humiliation and similar injuries unjustly caused. Although
incapable of pecuniary estimation, the amount must somehow be proportional to
and in approximation of the suffering inflicted. Moral damages are not punitive
in nature and were never intended to enrich the claimant at the expense of the
defendant. There is no hard-and-fast rule in determining what would be a fair
and reasonable amount of moral damages, since each case must be governed by
its own peculiar facts. Trial courts are given discretion in determining the
amount, with the limitation that it "should not be palpably and scandalously
excessive." Indeed, it must be commensurate to the loss or injury suffered.
Respondent Rosita Mañalac has adequately established the factual basis for
the award of moral damages when she testified that she suffered mental
anguish and social humiliation as a result of the failure of the bank to release the
subject properties or its failure to return the check despite its refusal to make a
definite commitment to comply with the clearly-stated object of the payment.
aimed at a restoration within the limits of the possible, of the spiritual status quo
ante; therefore, it must always reasonably approximate the extent of injury and
be proportional to the wrong committed. The award of P50,000.00 as moral
damages is reasonable under the circumstances.
Dispositive Portion:
WHEREFORE, the petition is GRANTED. The decision of the Court of Appeals
dated October 12, 2000 in CA-G.R. CV No. 50292 is REVERSED and SETASIDE.
The petitioner Philippine Savings Bank is DIRECTED to indemnify
respondent Rosita P. Mañalac in the amount of P50,000.00 as moral
damages. The Regional Trial Court of the City of Pasig, Branch 161 is ORDERED
to issue a writ of possession in favor of Philippine Savings Bank. No costs.
SO ORDERED.
EDUARDO P. MANUEL v. PEOPLE OF THE PHILIPPINES
G.R. No. 165842, November 29, 2005, CHICO-NAZARIO,* JJ.

Respondent Rodolfo Mañalac however is not similarly entitled to moral

FACTS:
damages. The award of moral damages must be anchored on a clear showing that
he actually experienced mental anguish, besmirched reputation, sleepless nights,
Eduardo was charged with bigamy. The prosecution adduced evidence that on
wounded feelings or similar injury. There was no better witness to this
July 28, 1975, Eduardo was married to Rubylus Gaa. He met the private
experience than respondent himself. Since respondent Rodolfo Mañalac failed to
complainant Tina B. Gandalera in Dagupan City sometime in January 1996. She
testify on the witness stand, the trial court did not have any factual basis to award
stayed in Bonuan, Dagupan City for two days looking for a friend. Tina was then
moral damages to him. Indeed, respondent Rodolfo Mañalac should have taken
21 years old, a Computer Secretarial student, while Eduardo was 39. Afterwards,
the witness stand and should have testified on the mental anguish, serious
Eduardo went to Baguio City to visit her. Eventually, as one thing led to another,
anxiety, wounded feelings and other emotional and mental suffering he
they went to a motel where, despite Tina's resistance, Eduardo succeeded in
purportedly suffered to sustain his claim for moral damages. Mere allegations do
having his way with her. Eduardo proposed marriage on several occasions,
not suffice; they must be substantiated by clear and convincing proof.
assuring her that he was single. Eduardo even brought his parents to Baguio City
to meet Tina's parents, and was assured by them that their son was still single.
Nevertheless, we find the award of P200,000.00 excessive and
unconscionable. As we said, moral damages are not intended to enrich the
Tina finally agreed to marry Eduardo sometime in the first week of March 1996.
complainant at the expense of the defendant. Rather, these are awarded only to
They were married on April 22, 1996. The couple was happy during the first three
enable the injured party to obtain "means, diversions or amusements" that will
years of their married life. Through their joint efforts, they were able to build
serve to alleviate the moral suffering that resulted by reason of the defendant's
their home in Cypress Point, Irisan, Baguio City. However, starting 1999, Manuel
culpable action. The purpose of such damages is essentially indemnity or
started making himself scarce and went to their house only twice or thrice a year.
reparation, not punishment or correction. In other words, the award thereof is
Tina was jobless, and whenever she asked money from Eduardo, he would slap
her. [6] Sometime in January 2001, Eduardo took all his clothes, left, and did not
return. Worse, he stopped giving financial support.
Sometime in August 2001, Tina became curious and made inquiries from the
National Statistics Office (NSO) in Manila where she learned that Eduardo had
been previously married.
For his part, Eduardo testified that he met Tina sometime in 1995 in a bar where
she worked as a Guest Relations Officer (GRO). He fell in love with her and
married her. He informed Tina of his previous marriage to Rubylus Gaa, but she
nevertheless agreed to marry him. Their marital relationship was in order until
this one time when he noticed that she had a 'love-bite on her neck. He then
abandoned her. Eduardo further testified that he declared he was 'single in his
marriage contract with Tina because he believed in good faith that his first
marriage was invalid. He did not know that he had to go to court to seek for the
nullification of his first marriage before marrying Tina.
Eduardo further claimed that he was only forced to marry his first wife because
sheVthreatened to commit suicide unless he did so. Rubylus was charged with
estafa in 1975 and thereafter imprisoned. He visited her in jail after three months
and never saw her again. He insisted that he married Tina believing that his first
marriage was no longer valid because he had not heard from Rubylus for more
than 20 years.
The court rendered judgment on July 2, 2002 finding Eduardo guilty beyond
reasonable doubt of bigamy. He was sentenced to an indeterminate penalty of
from six (6) years and ten (10) months, as minimum, to ten (10) years, as
maximum, and directed to indemnify the private complainant Tina Gandalera the
amount of P200,000.00 by way of moral damages, plus costs of suit.
The CA rendered judgment affirming the decision of the RTC with modification
as to the penalty of the accused
ISSUE:
Whether or not the CA erred in affirming the lower court’s decision in awarding
a moral damage when it has no basis in fact and in law
RULING:
The petitioner avers that the trial court and the CA erred in awarding moral
damages in favor of the private complainant. The private complainant was a 'GRO
before he married her, and even knew that he was already married. He genuinely
loved and took care of her and gave her financial support. He also pointed out
that she had an illicit relationship with a lover whom she brought to their house.
The petitioner maintains that moral damages may be awarded only in any of the
cases provided in Article 2219 of the Civil Code, and bigamy is not one of them.
The Court rules against the petitioner.
Moral damages include physical suffering, mental anguish, fright, serious anxiety,
besmirched reputation, wounded feelings, moral shock, social humiliation, and
similar injury. Though incapable of pecuniary computation, moral damages may
be recovered if they are the proximate result of the defendant's wrongful act or
omission. An award for moral damages requires the confluence of the following
conditions: first, there must be an injury, whether physical, mental or
psychological, clearly sustained by the claimant; second, there must be culpable
act or omission factually established; third, the wrongful act or omission of the
defendant is the proximate cause of the injury sustained by the claimant; and
fourth, the award of damages is predicated on any of the cases stated in Article
2219 or Article 2220 of the Civil Code.
Moral damages may be awarded in favor of the offended party only in criminal
cases enumerated in Article 2219, paragraphs 1, 3, 4, 5 and 7 of the Civil Code and
analogous cases.
Thus, the law does not intend that moral damages should be awarded in all cases
where the aggrieved party has suffered mental anguish, fright, moral anxieties,
besmirched reputation, wounded feelings, moral shock, social humiliation and
similar injury arising out of an act or omission of another, otherwise, there would
not have been any reason for the inclusion of specific acts in Article 2219 [67]
and analogous cases (which refer to those cases bearing analogy or resemblance,
corresponds to some others or resembling, in other respects, as in form,
proportion, relation, etc.)
Indeed, bigamy is not one of those specifically mentioned in Article 2219 of the
Civil Code in which the offender may be ordered to pay moral damages to the
private complainant/offended party. Nevertheless, the petitioner is liable to the
private complainant for moral damages under Article 2219 in relation to Articles
19, 20 and 21 of the Civil Code.
In the present case, the petitioner courted the private complainant and proposed
to marry her. He assured her that he was single. He even brought his parents to
the house of the private complainant where he and his parents made the same
assurance ' that he was single. Thus, the private complainant agreed to marry the
petitioner, who even stated in the certificate of marriage that he was single. She
lived with the petitioner and dutifully performed her duties as his wife, believing
all the while that he was her lawful husband. For two years or so until the
petitioner heartlessly abandoned her, the private complainant had no inkling that
he was already married to another before they were married.
Thus, the private complainant was an innocent victim of the petitioner's
chicanery and heartless deception, the fraud consisting not of a single act alone,
but a continuous series of acts. Day by day, he maintained the appearance of being
a lawful husband to the private complainant, who changed her status from a
single woman to a married woman, lost the consortium, attributes and support
of a single man she could have married lawfully and endured mental pain and
humiliation, being bound to a man who it turned out was not her lawful husband.
The Court rules that the petitioner's collective acts of fraud and deceit before,
during and after his marriage with the private complainant were willful,
deliberate and with malice and caused injury to the latter. That she did not
sustain any physical injuries is not a bar to an award for moral damages.
The Court thus declares that the petitioner's acts are against public policy as they
undermine and subvert the family as a social institution, good morals and the
interest and general welfare of society. Because the private complainant was an
innocent victim of the petitioner's perfidy, she is not barred from claiming moral
damages. Besides, even considerations of public policy would not prevent her
from recovery.
Considering the attendant circumstances of the case, the Court finds the award of
P200,000.00 for moral damages to be just and reasonable.
IN LIGHT OF ALL THE FOREGOING, the petition is DENIED. The assailed decision
of the Court of Appeals is AFFIRMED. Costs against the petitioner.
-Mika Ituriaga
JOSE S. ROQUE, JR., SUBSTITUTED BY HIS WIFE NORMA ROQUE, PETITIONER,
VS. JAIME T. TORRES, SUBSTITUTED BY HIS SON JAMES KENLEY M. TORRES,
AND THE HONORABLE COURT OF APPEALS, RESPONDENTS. G.R. NO. 157632,
December 06, 2006. CHICONAZARIO, J.
FACTS: (Edited Ina's digest)
The instant case sprang from an action for damages filed by the original
petitioner, the late Jose Roque, Jr., against respondent, the recently deceased
Jaime Torres, for injuries sustained by petitioner allegedly inflicted by the
security guards employed by respondent.
Petitioner was the administrator of certain parcels of land covered by OCT both
registered in the name of his son Rafael Roque. Sometime before the incident,
respondent, claiming to be the owner of said property, hired security guards from
Anchor Security and Detective Agency, namely Cesar Aquino, Alfredo Negro, and
Mariano Cabos, who allegedly barred petitioner from entering the property and
threatened him with physical harm should he attempt to tend the said land. As a
result, petitioner filed a case for grave threats against said security guards before
the MTC of Rizal.
Prior to the incident, respondent instituted an Action for cancellation of OCTs in
the name of petitioner's son Rafael Roque before the RTC of Antipolo which was
dismissed. Petitioner maintained that at around four o'clock in the afternoon of
27 August 1989, he, together with his housemaid Leilyn Saplot Kandt, Magno
Imperial, Jose Imperial, and Eliseo Pesito, visited the said property and was
surprised to see seven security guards guarding the property upon orders of
respondent. Said security guards asked him to leave the property and uttered:
"Bakit mo kami kinakalaban? Utos ni Torres na ito'y bantayan pagkat ito'y
kanyang property raw!." Petitioner showed his son's titles to the property but the
security guards merely answered: "Fake 'yan at hindi kayo maaaring pumasok
dito. Kayo ay dapat paalisin." A security guard then cocked his shotgun and
warned petitioner to leave the place. Petitioner offered to settle the dispute in the
office of Anchor Security Agency, through its manager, Mrs. Nassam, but the
security guards merely replied: "Wala kaming pakialam kay Nassam. Lahat
ginagawa dito, lahat ay utos ni Torres. At 'yan ay sinusunod naming dahil si
Torres ang bumubuhay sa amin."
When petitioner refused to leave the premises, Cabos threatened petitioner that
should he stay inside, Cabos would shoot him, so petitioner immediately left the
place.
However, Cabos still fired at him but missed. Petitioner ran to the back of his
makeshift hut and was shot again by Cabos, hitting petitioner on the back. When
petitioner fell, he turned and saw Cabos and Negro shooting at him. At the same
time, Aquino was also firing at the makeshift hut. As a result of the incident,
petitioner was hospitalized and placed under continuous treatment and
medication. Due to the multiple gunshot wounds, hematoma, and contusions
sustained by petitioner, his left eye became 90 to 95% blind and his body was
paralyzed from the bustline down. Consequently, petitioner filed a criminal case
for frustrated murder before the RTC of Antipolo against the security guards.
Eventually, after suffering for more than nine years, petitioner died.
The RTC rendered judgment in favor of petitioner. After a thorough examination
of the evidence presented by both parties, the Court is faced with the issue of:
"Whether or not defendant Torres can be held liable for damages to herein
plaintiff as a result of the injuries inflicted by the security guards deployed in the
property in question. The RTC held that Torres is liable.
RTC ruled that in this simple scenario and in the event that said security guards
caused wrong to others while in their tour of duty, the law provides that the
liability falls on the employer being the principal. On the contrary, for illegal or
harmful acts committed by the security guards as per order of the client or the
one who hired them, liability attaches to the latter. In the instant case, the
unlawful act committed by the security guards against the plaintiff is within the
strict compliance of the instruction of the defendant. Hence, defendant Torres is
liable for the unlawful acts committed by the said security guards against herein
plaintiff.
CA reversed the RTC judgment and rendered a Decision, the pertinent portions
of which read: It is settled that where the security agency, as here recruits, hires
and assigns the work of its watchmen or security guards, the agency is the
employer of such security guards or watchmen. Liability for illegal or harmful
acts committed by the security guards attaches to the employer agency, and not
to the clients or customers of such agency.
ISSUES:
I. Whether or not CA erred in ruling that Torres is absolved from liability.
II. Whether or not the petitioners are entitled to moral damages. (relevant)
RULING:
I
Article 2176 of the Civil Code provides that a person who, by act or omission,
causes damage to another through fault or negligence may be held liable in
damages. By making it appear that he owns the disputed properties, putting
security guards thereat to intimidate, harass or cause the rightful owner and his
representatives and by providing the escape vehicle, more than sufficient
evidence was established on the civil liability of private respondent under Article
2176 of the Civil Code of the Philippines.
It must be emphasized that private respondent committed all these overt acts
despite an earlier Decision by the RTC affirming Rafael Roque's ownership of the
properties and dismissing the case Torres filed for the cancellation title in Rafael
Roque's name. Had he not misrepresented to the security guards that he owns
the properties and had he not hired these security guards/common thugs to
secure the premises which he does not own, then the untoward incident would
not have happened. Respondent, by his grossly faulty acts, paved the way to the
infliction of injuries by the security guards on petitioner.
II
It is essential in the award of damages that the claimant must have satisfactorily
proven during the trial the existence of the factual basis of the damages and its
causal connection to defendant’s acts.
During trial, petitioner, through his own testimony and that of his wife, was able
to establish that they have incurred actual damages in the amount of P300,000.00
for the hospitalization of petitioner as a result of the shooting and the mauling
incident, thus, the award of actual damages in said amount is proper.
As regards the award of moral damages, we have ruled that there is no hard and
fast rule in the determination of what would be a fair amount of moral
damages, since each case must be governed by its own peculiar
circumstances.
As reflected in the records of the instant case, there is no gainsaying the fact that
petitioner, together with his family, had suffered physical suffering, mental
anguish, fright, serious anxiety and moral shock resulting from respondent’s acts
which caused petitioner grave physical injuries eventually leading to his death.
The several years of torment and agonizing on the part of the deceased
petitioner and his family more than justifiy the award of moral damages. It
must be emphasized that moral damages are not intended to enrich the
complainant at the expense of a defendant. They are awarded only to
enable the injured parties to obtain means, diversions or amusements that
will serve to alleviate the moral sufferings the injured parties have
undergone by reason of defendant’s culpable action.
In other words, the award of moral damages is aimed at a restoration within
the limits of the possible, of the spiritual status quo ante; and therefore it
must be proportionate to the suffering inflicted. Therefore, in light of the
sufferings sustained by petitioner and his family, we are inclined to sustain the
award of P1,000,000.00 as moral damages.
As to exemplary damages, Article 2229 of the Civil Code provides that such
damages may be imposed by way of example or correction for the public good, in
addition to the moral, temperate, liquidated or compensatory damages. While
exemplary damages cannot be recovered as a matter of right, they need not be
proved, although plaintiff must show that he is entitled to moral, temperate or
compensatory damages.
In the case at bar, having determined that petitioner is entitled to the award of
actual and moral damages as a result of the wanton act of respondent in
stationing security guards in the property, the title of which is under the name of
petitioner’s son, said act ultimately resulting in the paralysis and blindness of
petitioner, we find the award of exemplary damages to be proper by way of
correction for the public good of respondent’s flagrant display of bad faith.
WHEREFORE, premises considered, the Petition for Review is hereby GRANTED.
The Decision of the Court of Appeals in CA-G.R. CV No. 55895 is hereby
REVERSED and SET ASIDE. The Judgment of the Regional Trial Court of Quezon
City, Branch 104, in Civil Case No. Q-93-14408 ordering respondent Torres to pay
petitioner Roque the amount of P300,000.00 as actual damages; the amount of
P1,000,000.00 as moral damages; the amount of P300,000.00 as exemplary
damages; and the amount of P50,000.00 as attorney’s fee is hereby REINSTATED.
SO ORDERED.
BOBIE ROSE V. FRIAS, represented by her Attorney-in-fact, MARIE F.
FUJITA, Petitioner, vs. FLORA SAN DIEGO-SISON, Respondent.
G.R. No. 155223 April 4, 2007
FACTS: Petitioner is the owner of a house and lot located at Muntinlupa, Metro
Manila, which she acquired from Island Masters Realty and Development
Corporation (IMRDC) by virtue of a Deed of Sale dated Nov. 16, 1990. On
December 7, 1990, petitioner and Dra. Flora San Diego-Sison (respondent)
entered into a Memorandum of Agreement over the property. The Memorandum
of Agreement provides that in the event that respondent opts not to buy the
property, the money given by respondent to petitioner shall be treated as a loan
and the property shall be considered as the security for the mortgage.
Petitioner received from respondent two million pesos in cash and one million
pesos in a post-dated check. Petitioner then gave respondent TCT No. 168173 in
the name of IMRDC and the Deed of Absolute Sale over the property between
petitioner and IMRDC. Respondent decided not to purchase the property and
notified petitioner through a letter dated March 20, 1991, which petitioner
received only on June 11, 1991, reminding petitioner of their agreement that the
amount of 2 million pesos which petitioner received from respondent should be
considered as a loan payable within six months. Petitioner subsequently failed to
pay respondent the amount of two million pesos.
On April 1, 1993, respondent filed with the RTC of Manila, a complaint for sum of
money with preliminary attachment against petitioner. Respondent averred that
petitioner tried to deprive her of the security for the loan by making a false
report of the loss of her owner’s copy of TCT No. 168173 to the Taguig Police
Station on June 3, 1991, executing an affidavit of loss and by filing a petition
for the issuance of a new owner’s duplicate copy of said title with the RTC
of Makati, Branch 142; that the petition was granted in an Order dated August
31, 1991; that said Order was subsequently set aside in an Order dated April 10,
1992 where the RTC Makati granted respondent’s petition for relief from
judgment due to the fact that respondent is in possession of the owner’s duplicate
copy of TCT No. 168173, and ordered the provincial public prosecutor to conduct
an investigation of petitioner for perjury and false testimony.
Petitioner alleged, among others, that when she demanded the return of TCT No.
168173 and the Deed of Sale between her and the IMRDC from Atty. Lozada, the
latter gave her these documents in a brown envelope on May 5, 1991 which her
secretary placed in her attache case; that the envelope together with her other
personal things were lost when her car was forcibly opened the following day;
that she sought the help of Atty. Lozada who advised her to secure a police report,
to execute an affidavit of loss and to get the services of another lawyer to file a
petition for the issuance of an owner’s duplicate copy; that the petition for the
issuance of a new owner’s duplicate copy was filed on her behalf without her
knowledge and neither did she sign the petition nor testify in court as falsely
claimed for she was abroad; that she was a victim of the manipulations of Atty.
Lozada and respondent as shown by the filing of criminal charges for perjury and
false testimony against her.
The RTC ruled in favor of respondent. The CA affirmed the RTC decision but
reduced the rate of interest from 32% to 25% per annum, effective June 7, 1991
until fully paid. It held that the award of moral damages was warranted since
even granting petitioner had no hand in the filing of the petition for the issuance
of an owner’s copy, she executed an affidavit of loss of TCT No. 168173 when she
knew all along that said title was in respondent’s possession; petitioner’s claim
that she thought the title was lost when the brown envelope given to her by Atty.
Lozada was stolen from her car was hollow; that such deceitful conduct caused
respondent serious anxiety and emotional distress.
ISSUES:
1. W/N respondent San Diego-Sison is entitled to moral damages.
2. W/N respondent San Diego-Sison is entitled to attorney's fees.
RULING:
1. YES. Article 31 of the Civil Code provides that when the civil action is based
on an obligation not arising from the act or omission complained of as a felony,
such civil action may proceed independently of the criminal proceedings and
regardless of the result of the latter. While petitioner was acquitted in the false
testimony and perjury cases filed by respondent against her, those actions are
entirely distinct from the collection of sum of money with damages filed by
respondent against petitioner.
We agree with the findings of the trial court and the CA that petitioner’s act of
trying to deprive respondent of the security of her loan by executing an
affidavit of loss of the title and instituting a petition for the issuance of a
new owner’s duplicate copy of TCT No. 168173 entitles respondent to moral
damages. Moral damages may be awarded in culpa contractual or breach of
contract cases when the defendant acted fraudulently or in bad faith. Bad
faith does not simply connote bad judgment or negligence; it imports a dishonest
purpose or some moral obliquity and conscious doing of wrong. It partakes of the
nature of fraud.
The Memorandum of Agreement provides that in the event that respondent opts
not to buy the property, the money given by respondent to petitioner shall be
treated as a loan and the property shall be considered as the security for the
mortgage. It was testified to by respondent that after they executed the
agreement on December 7, 1990, petitioner gave her the owner’s copy of the title
to the property, the Deed of Sale between petitioner and IMRDC, the certificate of
occupancy, and the certificate of the Secretary of the IMRDC who signed the Deed
of Sale. However, notwithstanding that all those documents were in
respondent’s possession, petitioner executed an affidavit of loss that the
owner’s copy of the title and the Deed of Sale were lost.
Although petitioner testified that her execution of the affidavit of loss was due to
the fact that she was of the belief that since she had demanded from Atty. Lozada
the return of the title, she thought that the brown envelope with markings which
Atty. Lozada gave her on May 5, 1991 already contained the title and the Deed of
Sale as those documents were in the same brown envelope which she gave to
Atty. Lozada prior to the transaction with respondent. Such statement remained
a bare statement. It was not proven at all since Atty. Lozada had not taken the
stand to corroborate her claim. In fact, even petitioner’s own witness, Benilda
Ynfante, was not able to establish petitioner's claim that the title was returned by
Atty. Lozada in view of Ynfante's testimony that after the brown envelope was
given to petitioner, the latter passed it on to her and she placed it in petitioner’s
attaché case and did not bother to look at the envelope.
It is clear therefrom that petitioner’s execution of the affidavit of loss became the
basis of the filing of the petition with the RTC for the issuance of new owner’s
duplicate copy of TCT No. 168173. Petitioner’s actuation would have deprived
respondent of the security for her loan were it not for respondent’s timely filing
of a petition for relief whereby the RTC set aside its previous order granting the
issuance of new title. Thus, the award of moral damages is in order.
The entitlement to moral damages having been established, the award of
exemplary damages is proper. Exemplary damages may be imposed upon
petitioner by way of example or correction for the public good. The RTC awarded
the amount of ₱100,000.00 as moral and exemplary damages.

2. NO. Article 2208 of the New Civil Code enumerates the instances where
attorney's fees may be awarded and, in all cases, it must be reasonable, just and
equitable if the same were to be granted. Attorney's fees as part of damages are
not meant to enrich the winning party at the expense of the losing litigant. They
are not awarded every time a party prevails in a suit because of the policy that no
premium should be placed on the right to litigate. The award of attorney's fees is
the exception rather than the general rule. As such, it is necessary for the trial
court to make findings of facts and law that would bring the case within the
exception and justify the grant of such award. The matter of attorney's fees
cannot be mentioned only in the dispositive portion of the decision. They must
be clearly explained and justified by the trial court in the body of its decision. On
appeal, the CA is precluded from supplementing the bases for awarding
attorney’s fees when the trial court failed to discuss in its Decision the reasons
for awarding the same. Consequently, the award of attorney's fees should be
deleted.
DISPOSITIVE PORTION:
WHEREFORE, in view of all the foregoing, the Decision dated June 18, 2002 and
the Resolution dated September 11, 2002 of the Court of Appeals in CA-G.R. CV
No. 52839 are AFFIRMED with MODIFICATION that the award of attorney’s fees
is DELETED. No pronouncement as to costs. SO ORDERED.
3. IN BREACH OF CONTRACT OF AIR CARRIAGE
PHILIPPINE AIRLINES, INCORPORATED, Petitioner, v. COURT OF APPEALS
AND SPOUSES MANUEL S. BUNCIO AND AURORA R. BUNCIO, MINORS
DEANNA R. BUNCIO AND NIKOLAI R. BUNCIO, ASSISTED BY THEIR FATHER,
MANUEL S. BUNCIO, AND JOSEFA REGALADO, REPRESENTED BY HER
ATTORNEY-IN-FACT, MANUEL S. BUNCIO, Respondents..
FACTS
Sometime before 2 May 1980, private respondents spouses Manuel S. Buncio and
Aurora R. Buncio purchased from petitioner Philippine Airlines, Incorporated,
two plane tickets4 for their two minor children, Deanna R. Buncio (Deanna), then
9 years of age, and Nikolai R. Buncio (Nikolai), then 8 years old. Since Deanna and
Nikolai will travel as unaccompanied minors, petitioner required private
respondents to accomplish, sign and submit to it an indemnity bond. 5 Private
respondents complied with this requirement. For the purchase of the said two
plane tickets, petitioner agreed to transport Deanna and Nikolai on 2 May 1980
from Manila to San Francisco, California, United States of America (USA), through
one of its planes, Flight 106. Petitioner also agreed that upon the arrival of
Deanna and Nikolai in San Francisco Airport on 3 May 1980, it would again
transport the two on that same day through a connecting flight from San
Francisco, California, USA, to Los Angeles, California, USA, via another airline,
United Airways 996. Deanna and Nikolai then will be met by their grandmother,
Mrs. Josefa Regalado (Mrs. Regalado), at the Los Angeles Airport on their
scheduled arrival on 3 May 1980.
On 2 May 1980, Deanna and Nikolai boarded Flight 106 in Manila.
On 3 May 1980, Deanna and Nikolai arrived at the San Francisco Airport.
However, the staff of United Airways 996 refused to take aboard Deanna and
Nikolai for their connecting flight to Los Angeles because petitioner's personnel
in San Francisco could not produce the indemnity bond accomplished and
submitted by private respondents. The said indemnity bond was lost by
petitioner's personnel during the previous stop-over of Flight 106 in Honolulu,
Hawaii. Deanna and Nikolai were then left stranded at the San Francisco Airport.
Subsequently, Mr. Edwin Strigl (Strigl), then the Lead Traffic Agent of petitioner
in San Francisco, California, USA, took Deanna and Nikolai to his residence in San
Francisco where they stayed overnight.
Meanwhile, Mrs. Regalado and several relatives waited for the arrival of Deanna
and Nikolai at the Los Angeles Airport. When United Airways 996 landed at the
Los Angeles Airport and its passengers disembarked, Mrs. Regalado sought
Deanna and Nikolai but she failed to find them. Mrs. Regalado asked a stewardess
of the United Airways 996 if Deanna and Nikolai were on board but the
stewardess told her that they had no minor passengers. Mrs. Regalado called
private respondents and informed them that Deanna and Nikolai did not arrive
at the Los Angeles Airport. Private respondents inquired about the location of
Deanna and Nikolai from petitioner's personnel, but the latter replied that they
were still verifying their whereabouts.
On the morning of 4 May 1980, Strigl took Deanna and Nikolai to San Francisco
Airport where the two boarded a Western Airlines plane bound for Los Angeles.
Later that day, Deanna and Nikolai arrived at the Los Angeles Airport where they
were met by Mrs. Regalado. Petitioner's personnel had previously informed Mrs.
Regalado of the late arrival of Deanna and Nikolai on 4 May 1980.
On 17 July 1980, private respondents, through their lawyer, sent a letter 6 to
petitioner demanding payment of 1 million pesos as damages for the gross
negligence and inefficiency of its employees in transporting Deanna and Nikolai.
Petitioner did not heed the demand.
On 20 November 1981, private respondents filed a complaint 7 for damages
against petitioner before the RTC.
ISSUE
Whether or not PAL was liable for moral damages
HELD
When an airline issues a ticket to a passenger, confirmed for a particular flight on
a certain date, a contract of carriage arises. The passenger has every right to
expect that he be transported on that flight and on that date, and it becomes the
airline's obligation to carry him and his luggage safely to the agreed destination
without delay. If the passenger is not so transported or if in the process of
transporting, he dies or is injured, the carrier may be held liable for a breach of
contract of carriage.14
Private respondents and petitioner entered into a contract of air carriage when
the former purchased two plane tickets from the latter. Under this contract,
petitioner obliged itself (1) to transport Deanna and Nikolai, as unaccompanied
minors, on 2 May 1980 from Manila to San Francisco through one of its planes,
Flight 106; and (2) upon the arrival of Deanna and Nikolai in San Francisco
Airport on 3 May 1980, to transport them on that same day from San Francisco
to Los Angeles via a connecting flight on United Airways 996. As it was, petitioner
failed to transport Deanna and Nikolai from San Francisco to Los Angeles on the
day of their arrival at San Francisco. The staff of United Airways 996 refused to
take aboard Deanna and Nikolai for their connecting flight to Los Angeles because
petitioner's personnel in San Francisco could not produce the indemnity bond
accomplished and submitted by private respondents. Thus, Deanna and Nikolai
were stranded in San Francisco and were forced to stay there overnight. It was
only on the following day that Deanna and Nikolai were able to leave San
Francisco and arrive at Los Angeles via another airline, Western Airlines. Clearly
then, petitioner breached its contract of carriage with private respondents.
In breach of contract of air carriage, moral damages may be recovered where (1)
the mishap results in the death of a passenger; or (2) where the carrier is guilty
of fraud or bad faith; or (3) where the negligence of the carrier is so gross and
reckless as to virtually amount to bad faith.15
Gross negligence implies a want or absence of or failure to exercise even slight
care or diligence, or the entire absence of care. It evinces a thoughtless disregard
of consequences without exerting any effort to avoid them.16
In Singson v. Court of Appeals,17 we ruled that a carrier's utter lack of care for and
sensitivity to the needs of its passengers constitutes gross negligence and is no
different from fraud, malice or bad faith. Likewise, in Philippine Airlines, Inc. v.
Court of Appeals,18 we held that a carrier's inattention to, and lack of care for, the
interest of its passengers who are entitled to its utmost consideration,
particularly as to their convenience, amount to bad faith and entitles the
passenger to an award of moral damages.
It was established in the instant case that since Deanna and Nikolai would travel
as unaccompanied minors, petitioner required private respondents to
accomplish, sign and submit to it an indemnity bond. Private respondents
complied with this requirement. Petitioner gave a copy of the indemnity bond to
one of its personnel on Flight 106, since it was required for the San Francisco-Los
Angeles connecting flight of Deanna and Nikolai. Petitioner's personnel lost the
indemnity bond during the stop-over of Flight 106 in Honolulu, Hawaii. Thus,
Deanna and Nikolai were not allowed to take their connecting flight.
Evidently, petitioner was fully aware that Deanna and Nikolai would travel as
unaccompanied minors and, therefore, should be specially taken care of
considering their tender age and delicate situation. Petitioner also knew well that
the indemnity bond was required for Deanna and Nikolai to make a connecting
flight from San Francisco to Los Angeles, and that it was its duty to produce the
indemnity bond to the staff of United Airways 996 so that Deanna and Nikolai
could board the connecting flight. Yet, despite knowledge of the foregoing, it did
not exercise utmost care in handling the indemnity bond resulting in its loss in
Honolulu, Hawaii. This was the proximate cause why Deanna and Nikolai were
not allowed to take the connecting flight and were thus stranded overnight in San
Francisco. Further, petitioner discovered that the indemnity bond was lost only
when Flight 106 had already landed in San Francisco Airport and when the staff
of United Airways 996 demanded the indemnity bond. This only manifests that
petitioner did not check or verify if the indemnity bond was in its custody before
leaving Honolulu, Hawaii for San Francisco.
The foregoing circumstances reflect petitioner's utter lack of care for and
inattention to the welfare of Deanna and Nikolai as unaccompanied minor
passengers. They also indicate petitioner's failure to exercise even slight care and
diligence in handling the indemnity bond. Clearly, the negligence of petitioner
was so gross and reckless that it amounted to bad faith.
It is worth emphasizing that petitioner, as a common carrier, is bound by law to
exercise extraordinary diligence and utmost care in ensuring for the safety and
welfare of its passengers with due regard for all the circumstances. 19 The
negligent acts of petitioner signified more than inadvertence or inattention and
thus constituted a radical departure from the extraordinary standard of care
required of common carriers.
Petitioner's claim that it cannot be entirely blamed for the loss of the indemnity
bond because it gave the indemnity bond to the immigration office of Honolulu,
Hawaii, as a matter of procedure during the stop-over, and the said immigration
office failed to return the indemnity bond to petitioner's personnel before Flight
106 left Honolulu, Hawaii, deserves scant consideration. It was petitioner's
obligation to ensure that it had the indemnity bond in its custody before leaving
Honolulu, Hawaii for San Francisco. Petitioner should have asked for the
indemnity bond from the immigration office during the stop-over instead of
partly blaming the said office later on for the loss of the indemnity bond.
Petitioner's insensitivity on this matter indicates that it fell short of the
extraordinary care that the law requires of common carriers.
D. When moral damages is mandatory
PEOPLE OF THE PHILIPPINES, Appellee, v. ALEJANDRO BAJAR, Appellant.
G. R. No. 143817, EN BANC, October 27, 2003, Per Curiam
FACTS:
For the killing of his father-in-law, Aquilio Tiwanak, appellant Alejandro Bajar
was found guilty beyond reasonable doubt of the crime of murder and sentenced
to suffer the penalty of death in the 17 July 2000 Decision of the Regional Trial
Court of Misamis Oriental, Branch 18, in Criminal Case No. 99-942.
The aggravating circumstances of dwelling, taking advantage of superior
strength, disregard of the respect due the victim on account of his age, habitual
intoxication and relationship attended the commission of the crime.
Upon his arraignment on 8 February 2000, Alejandro pleaded not guilty, and trial
thereafter ensued. The prosecution presented as witnesses Alejandros wife,
Lolita Bajar, and their two children, Ana Bajar Rabor and Alma Luna Bajar, to
testify on the events surrounding the commission of the crime.
On 16 August 1999, Ana Bajar Rabor, a resident of Wao, Bukidnon, visited her
parents in their house in Sitio Mohon, Mambayaan, Balingasag, Misamis Oriental.
At around 3:00 p.m. of that day, her father Alejandro arrived home already very
drunk. At 5:00 p.m., Anas mother, Lolita Bajar, suggested that since her father was
very drunk, she should sleep at the house of her maternal grandfather, the victim
Aquilio, just one hundred meters away from the house of Lolita.
That night, at around 8:00 p.m., Ana was listening to the radio while lying on the
floor of the bedroom in his grandfathers house. With her were her 1-year-old
daughter, Maybe Ann; her 11-year-old sister, Alma Bajar; and her 2-year-old
niece, May Joy Labandia. She was lying on the side of a wall that separated the
bedroom from the sala. This wall was made of bamboo splits with holes or gaps
in between such that she could clearly see her grandfather lying on his bed in the
sala. A gas lamp lit up the bedroom, while another hung on the wall near the foot
of the bed of her grandfather.
The scenario was broken by the voice of Alejandro, who was still obviously very
drunk, inquiring whether his wife was in the house. While speaking his demand,
he pushed the main door to gain entry into the house, but he was not able to enter.
Aquilio answered that his wife was in their (Alejandros) house. Alejandro
accused Aquilio of lying and of hiding his daughter. Aquilio told Alejandro to go
home. Silence thereafter ensued.
Suddenly, Ana heard a sound and saw that Alejandro was able to enter the house
through the kitchen door. He was carrying a bolo and approaching her
grandfather. She saw her father hack her grandfather, who was lying on the bed.
She got up, ran towards the sala, and saw her father still hacking his grandfather.
She yelled for her father to stop. While he was being stabbed and attacked, Aquilio
stood up to embrace his son-in-law. Ana shouted for help as she held down the
hand which her father used to wield the bolo. Alma witnessed these two last
scenes. She saw her sister Ana trying to stay the hand of their father which held
the bolo, and Aquilio embracing Alejandro while being hacked by the latter.
Lolita, having heard the cries of her daughter, came to her fathers house. There,
she saw Aquilio embracing Alejandro. She then instructed Ana to hold on to
Alejandro while she looked for a piece of wood with which to hit him. With the
piece of wood she found, she struck Alejandros head three times. Alejandro
fainted. By this time, Aquilio slowly sank down to the floor and drew his last
breath. Lolita forthwith went outside to seek the help of neighbors. Anas uncle,
Tating Aganap, arrived and later brought two policemen, who handcuffed
Alejandro.
Lolita also testified that she spent P30,000 for her father Aquilios burial
expenses. She felt sad about the demise of her father and described how her
sorrow could not be quantified by monetary consideration. To prove the age of
her father, Lolita presented the latters Identification Card from the Veterans
Federation of the Philippines, which indicated that he was born on 12 May 1914.
Aquilio was then 85 years old.
The prosecutions last witness was Dr. Angelita Enopia, the Health Officer of
Balingasag, Misamis Oriental. She confirmed the findings she made on the
postmortem examination she conducted on the cadaver of Aquilio and on the
death certificate she issued. She claimed that Aquilio suffered three big wounds:
one on the maxilliary area on the right cheek which was slanting towards the
mouth, one on the anterior chest left side downwards to the armpit, and one
straight to the scapular area at the back. She opined that the injuries were
probably caused by a sharp object such as a bolo or a knife.
The defense presented Alejandro as its lone witness. Alejandro testified that on
the date and time in question, he left his two daughters, Ana and Alma, and his
two grandchildren, Mary Joy and Ann-Ann, at his house. He proceeded to his
father-in-laws house to look for his wife. Upon arrival, he greeted Aquilio with
respect: Pa, good evening. The latter replied that Lolita was not there and invited
him (Alejandro) to go up and see for himself. Alejandro went up, and not finding
his wife, said: She is not here Pa. Aquilio angrily retorted: Everytime you are drunk
you come here to ask me. Aquilio then suddenly clubbed Alejandro on the head
with a 2 x 3 coco lumber he saw near the door.
Alejandro then touched his head, and saw blood on his hand. He felt dizzy. Seeing
that Aquilio was about to attack him again, he drew out his hunting knife and
defended himself by moving his hand from the right to left. He felt he hit
something before he lost consciousness. He regained consciousness at the
Northern Mindanao Medical Center and discovered that a policeman brought him
there for the treatment of his head wound. He was found to have sustained
sutured wound 4 cm. left temporo-occipital area; lacerated wound 3 cm. left
alteral neck area and confluent abrasion 3 pts. 1 x 1 cm. 2 x 1 cm. and 1 x 1 cm.,
left knee, with seven days healing period.
Alejandro was later brought to the Balingasag Municipal Jail, where he was
visited by his two children and wife. On their respective visits, they informed him
that Aquilio was already dead. He cried when he learned the news, and begged
for his wifes forgiveness.
In its decision of 17 July 2000, the trial court found Alejandro guilty beyond
reasonable doubt of the crime charged against him, with treachery as the
qualifying circumstance. Considering the presence of the generic aggravating
circumstances of dwelling, disregard of the respect due to the victim by reason of
his age, relationship, and habitual intoxication, the trial court sentenced
Alejandro to suffer the penalty of death and to pay the heirs of the victim P30,000
as burial expenses; P50,000 as death indemnity; and P25,000 as exemplary
damages.
ISSUE:
Whether or not the award of moral damages is mandatory in this case.(YES)
RULING:
The case is now before us on automatic review.
We affirm Alejandros conviction.
Settled is the rule that when the credibility of witnesses is in issue, appellate
courts generally defer to the findings of the trial court, considering that the latter
is in a better position to decide the question after having heard the witnesses and
observed their deportment and manner of testifying during the trial. There are
some exceptions to this rule, such as when the evaluation was reached arbitrarily
or when the trial court overlooked, misunderstood, or misapplied some facts or
circumstances of weight and substance which, if considered, would affect the
result of the case. Not one of these exceptions is present in this case.
We affirm, therefore, the trial courts imprimatur of credence to the testimonies
of prosecution witnesses Lolita, Ana and Alma (all surnamed Bajar), who
corroborated each others testimonies on material points. Ana clearly saw
through the gaps in the bamboo walls and by going to the sala how her father
stealthily entered her grandfathers house, surreptitiously approached his
sleeping grandfather, and surprised the latter to wakefulness by his bolo
hackings. Lolita heard and then responded to Anas shouts for help. Seeing how
Ana was trying to prevent her father from further attacking her grandfather,
Lolita helped her by clubbing her husbands head with a piece of coconut lumber.
Ana and Alma corroborated their mothers account on this matter.
Thus, we agree with the trial courts observation that Alejandros uncorroborated
self-defense theory could not stand against the positive, categorical, spontaneous,
and straightforward declarations of his daughters and wife. A plea of self-defense
cannot be justifiably appreciated, especially when uncorroborated by
independent and competent evidence or when it is extremely doubtful by itself.
We shall now discuss the trial courts appreciation of the different aggravating
circumstances.
Treachery was proved by Anas testimony. She narrated that there was an ensuing
silence after Aquilio told Alejandro to go home. It was apparent that Aquilio
resumed his interrupted sleep. Even Ana was undisturbed by the exchange of
words, for she remained in the bedroom lying down and ready to sleep. Aquilio
and his grandchildren had no inkling that Alejandro would trespass his dwelling
by entering through the kitchen door. Aquilio was completely unaware of the
impending attack and, ultimately, his doom. And suddenly, Alejandro hacked him
on the face as he was lying down resting on his bed. The means, method, and form
of the attack in this case were, therefore, consciously adopted and effectively
forestalled Aquilio from employing a defense against his attacker.
Aside from treachery, the prosecution was able to prove three aggravating
circumstances, to wit, dwelling, relationship, and disregard of the respect due the
offended party on account of age.
Dwelling aggravates a felony where the crime was committed in the dwelling of
the offended party, who has not given any provocation. It is considered
aggravating primarily because of the sanctity of privacy the law accords to human
abode. He who goes to anothers house to hurt him or do him wrong is more guilty
than he who offends him elsewhere. Aquilio did not provoke Alejandro; it was
Alejandro who rudely and drunkenly interrupted the quiet and restful evening
Aquilio was enjoying. He even attempted to enter the house without being invited
and without the door being opened for him. Clearly, because of his drunken
condition, he was not welcome. After Aquilio told him to go home, a certain
quietude descended into the night, a lull which Alejandro used as a cover to
pursue his plan to kill Aquilio. He doubly violated the sanctity of Aquilios abode
when he trespassed it by entering through the kitchen door and then killing
Aquilio.
Anent the generic aggravating circumstance of disregard of the respect due the
offended party on account of age, it is considered present when the offended
person, by reason of his age, could be the father of the offender. This is obvious
in this case. Not only was Aquilio, by reason of his age, considered old enough to
be the father of Alejandro (who incidentally declared in open court that he was
58 years old), he was also the latters father-in-law. The presence of this
aggravating circumstance by reason of their age difference is, therefore,
reinforced by their actual relationship by affinity. Further, it is ingrained in
Philippine culture that those advanced in age are respected especially in the
provinces.
Suffice it is to say that the alternative circumstance of relationship was correctly
appreciated, the victim being the father-in-law of the appellant.
With regard to the alternative circumstance of intoxication, which the trial court
treated as aggravating, we find that it has not been shown to be habitual or
intentional as required by Article 15 of the Revised Penal Code. Lolita testified
that her husband would drink liquor once a week but was not a frequent drinker.
She also admitted that on that fateful day, there was a fiesta celebration at
Barangay Mambayaan. As Alejandro insists, it was but natural for him to drink
liquor during fiesta celebrations. In the absence of clear and positive proof that
Alejandros intoxication was habitual or subsequent to the plan to commit the
crime, it is improper to consider the same as an aggravating circumstance.
Neither can intoxication be considered mitigating in the instant case, there being
no proof that the appellant was so drunk that his will-power was impaired or that
he could not comprehend the wrongfulness of his acts.
Under Article 248 of the Revised Penal Code, the penalty for murder is reclusion
perpetua to death. With the attendance of the generic aggravating circumstances
of dwelling, disregard of the respect due to the offended party by reason of age,
and relationship without any mitigating circumstance to offset them, the
imposition of the death penalty is justified pursuant to Article 63 of the Revised
Penal Code.
On the matter of damages, we agree with Alejandros contention that the trial
court erred in awarding P30,000 as burial expenses for lack of receipts to prove
the same. It is necessary for a party seeking the award of actual damages to
produce competent proof or the best evidence obtainable to justify such award.
Only substantiated and proven expenses, or those that appear to have been
genuinely incurred in connection with the death, wake, or burial of the victim will
be recognized in court. Nonetheless, in line with new jurisprudence, we shall
award temperate damages in the amount of P25,000 to the victims heirs, since
they clearly incurred funeral expenses.
We observe that no moral damages was decreed by the trial court. Lolita testified
that no monetary consideration could equal a daughters loss of her father. In
recent jurisprudence, we held that the award of moral damages is mandatory
in cases of murder and homicide, without need of allegation and proof other
than the death of the victim. We therefore award moral damages in favor of
Aquilios heirs in the amount of P50,000. We reiterate what we said in People v.
Panado:
Unlike in the crime of rape, we grant moral damages in murder or
homicide only when the heirs of the victim have alleged and proved
mental suffering. However, as borne out by human nature and
experience, a violent death invariably and necessarily brings about
emotional pain and anguish on the part of the victims family. It is
inherently human to suffer sorrow, torment, pain and anger when a
loved one becomes the victim of a violent or brutal killing. Such violent
death or brutal killing not only steals from the family of the deceased his
precious life, deprives them forever of his love, affection and support, but
often leaves them with the gnawing feeling that an injustice has been
done to them. For this reason, moral damages must be awarded even in
the absence of any allegation and proof of the heirs emotional suffering.
Verily Hilda and her son Louie Gee would forever carry the emotional
wounds of the vicious killing of a husband and a father. With or without
proof, this fact can never be denied; since it is undisputed, it must be
considered proved.46cräläwvirtualibräry
We affirm the award of P50,000 as death indemnity, and the award of P25,000 as
exemplary damages by virtue of the attendance of three aggravating
circumstances, pursuant to Article 2230 of the Civil Code.
WHEREFORE, the 17 July 2000 Decision of the Regional Trial Court of Misamis
Oriental, Branch 18, in Criminal Case No. 99-942 is hereby AFFIRMED with
modifications. Appellant ALEJANDRO BAJAR is found guilty beyond reasonable
doubt of the crime of murder and sentenced to suffer the penalty of death. The
awards of P50,000 as civil indemnity and P25,000 as exemplary damages in favor
of the heirs of the victim AQUILIO TIWANAK are affirmed. The award for burial
expenses is deleted; however, in lieu thereof, an award of P25,000 as temperate
damages is hereby adjudged, payable to the heirs of the victim. The appellant is
likewise ordered to pay the heirs of the victim moral damages in the amount of
P50,000.

E. When Moral Damages are not recoverable
EMILIO STREBEL. PLAINTIFF-APPELLANT, VS. JOSE FIGUERAS, ACTING
SECRETARY OF LABOR, FELIPE E. JOSE, DIRECTOR OF LABOR AND
CORNELIO S. RUPERTO, ASSISTANT CITY FISCAL OF MANILA, DEFENDANTS-
APPELLEES.
G. R. No. L-4722, December 29, 1954, CONCEPCION, J.
Facts:
The complaint purports to set forth three causes of action. The alleged acts upon
which plaintiff's first cause of action is predicated may be divided into four (4)
groups, namely:
1. That, as lessee of a lot situated at Nos. 735-737 Santa Mesa, Manila,
plaintiff Strebel subleased part thereof to the Standard Vacuum Oil
Company; that the latter constructed thereon a Mobilgas Station which
was operated by Eustaqulo & Co., a partnership organized by said
plaintiff and one Prime Eustaquio; that, "out of spite and with a view to
the eventual acquisition of the said property for himself and his men,"
defendant Jose Figueras tried all he could to built a drainage through11
the aforementioned property; that, in order to accomplish this purpose,
and, using his official and political influence, defendant Figueras, then
Under-Secretary of Labor, caused his co-defendant Cornelio S. Ruperto,
an Assistant City Fiscal of Manila, to prepare an opinion, dated June 13,
1949, which was signed by the City Fiscal, holding that the City of Manila
has a right to construct said drainage, and, to this effect, make the
necessary excavations, of about 70 centimeters in width, at the boundary
line of said lot leased to Strebel and the lot belonging to Figueras; that,
said opinion induced the city engineer of Manila to write to plaintiff
Strebel but the latter protested against the proposed excavation and
drainage, which, accordingly, was not made or construed.
2. That on September 14, 1949: defendant Figueras by making use of his
official and political connections," was able to induce the Secretary of
Justice to transfer temporarily, from the Bureau of Immigration to
the Bureau of Prisons, one Dr. Manuel Hernandez, the husband of
plaintiff's step daughter. That is said to be "coercive in nature and
derogatory not only to Dr. Manuel Hernandez but also the herein plaintiff
and his wife.
3. That, on or about, September 15, 1949, "making use of his official and
political influence," and with the cooperation of his former secretary,
defendant Cornelio S. Ruperto, an Assistant City Fiscal of Manila, as well
as "in connivance with the Director of Labor" which office was then held
by defendant Felipe E. Jose, "and other employees in the Department and
Bureau of Labor,11 defendant Figueras succeeded in securing the
institution, against plaintiff Strebel, and his partner, Prime Eustaqul, of
Criminal Case No. 11005 of the Court of First Instance of Manila, for
allegedly compelling several employees to work more than eight (8)
hours a days in violation of Commonwealth Act No, 444, in relation to
Commonwealth Act No. 303, although before the filing of the information
"the defendants collectively and singly knew that the allegations
therein are false; that said criminal case was subsequently
dismissed by the Court of First Instance of Manila for failure of the
prosecution "to establish even a prima facie case against the
accused"; and
4. That, prior thereto, defendant Cornelio Ruperto, in connivance with his
co-defendant Jose Figueras, had secured the dismissal of two criminal
cases against the "bodyguards and cohorts" of the latter, "although the
information in both cases were filed after careful investigation of fiscals
of proven integrity."
In support of his second cause of action, plaintiff alleges that, "with a view to
further injuring" him "and besmirching his good name in the community and
waging a cleavage in the harmonious relation between Eustaquio & Co. and its
laborers," defendants Felipe E. Jose and Cornello S. Ruperto issued a press
statement to the effect that plaintiff Strebel and his partner, Sustaquio had
flagrantly violated the provisions of the Eight-Hour Law and that said Criminal
Case No. 11005 had been dismissed by the court on a flimsy ground; and that this
statement had "caused moral and mental suffering to the herein plaintiff and
damage to his business in the amount of P5,000.00 which he prays "that the
defendants, particularly Felipe Jose and Cornelio S. Ruperto be condemned
jointly and severally to pay" to him. The aforementioned statement is allegedly
contained in the following news item, marked Exhibit L, and published in the
Evening News of September 19, 1950:
"JOSE, FISCAL RAP DECISION
 Director of Labor Felipe B. Jose branded this noon as highly prejudicial
to the interest of labor the decision of the court of first instance
dismissing the case filed by five laborers against two owners of gasoline
station's, who according to the director flagrantly Violated the
provisions of the eight-hour labor law.
"The director announced that he and the city fiscal will appeal the case
to the supreme court until the two violators are punished accordingly.
"Cornelio S. Ruperto, assistant city fiscal, charged that, without taking
into consideration the pertinent portions of Commonwealth Act the
court dismissed the case on the flimsy argument of the counsel for the
defendants that affidavits of the laborers shoved the latter never
complained against the action of the owners, Emilio Strebel and Primo
Eustaquio to anybody, including the department of labor.
"Ruperto declared that the argument which cause the dismissal of the
case is impertinent and immaterial in the instant case, because, he said
the of the law on the matter is clear and implicit.
"Section 6 of the law says that 'any agreement or contract between the
employer and the labors or employee contrary to the provisions of this
act shall be null and void ab initio therefore, Ruperto said, the agreement
between the five laborers and the owners is illegal and that the action of
the latter is subject to the penal provision of the said law
"According to the case. Eduardo Gonzales, Emilio Samson, Rodolfo
Quintos, Pedro Bensira, and Silverio, Trinidad were compelled to work
more than the required eight hours not secured from the department of
labor which requires overtime payment for work rendered in excess of
eight boors,
"It is recalled that in the celebrated Cuevo-Barrado case the adverse
decision of the judge who handled the case was appealed to the supreme
court which accordingly reversed the decision In favor of the laborer.
The action of the judge aroused the ire of the late President Quezon who
ordered the immediate dismissal of the judge."
It is further alleged in the complaint that, through the foregoing series of acts, the
defendants have "caused moral and mental suffering to the plaintiff, his wife, and
his entire family, and damage to his business in the amount of P15,000.00,
besides actual damages in the amount of P1,500.00 paid to his attorney in
defending himself from the malicious charge," which sums plaintiff prays that the
defendants be sentenced to pay jointly and severally.
Issue:
1. Whether or not moral damages can be recovered by the plaintiff in the
assignment of his wife’s son-in-law from Bureau of Prisons to Bureau of
immigration. (No)
2. Whether or not moral damages can be recovered for the complaint of
malicious prosecution filed by the plaintiff against the defendant. (No)
3. Whether or not moral damages can be recovered in the press statement
of the defendant. (No)
Ruling:
1. As a general rule, the right of recovery for mental suffering resulting from
"bodily injuries is restricted to the person who has suffered the bodily hurt, and
there can be no recovery for distress caused by sympathy for another's suffering,
or for fright due to a wrong against a third person. So the anguish of mind arising
as to the safety of others who may be in personal peril from the same cause
cannot be taken into consideration.
The rule on this point, as stated in the American Jurisprudence, is: "Injury or
Wrong to Another. In law mental. anguish is restricted as a rule, to such mental
pain or suffering as arises from an injury or wrong to the person himself, as
distinguished from that form of mental suffering which is the accompaniment of
sympathy or sorrow for another's suffering or which arises from a contemplation
of wrongs committed on the person of another. Pursuant to the rule stated, a
husband or wife cannot recover for mental suffering caused by his or her
sympathy for the other's suffering."
In this connection, it should be noted that plaintiff is not even related to Dr.
Hernandez. The latter's wife is a daughter of Mrs. Strebel by a previous marriage.
Hence, Dr. Hernandez is merely related by affinity, not to Strebel, but to a relative
by affinity of said plaintiff. It would be extremely dangerous, apart from unjust,
to sanction a recovery, by the plaintiff, of moral damages for the temporary
transfer of Dr. Hernandez. If the mental anguish allegedly suffered by plaintiff in
consequence thereof ware sufficient to give him a cause of action therefor, there
would be no valid legal reason to deny the same relief to any other person who
might have thus been inconvenienced, such as the friends of Dr. Hernandez, and
public officials similarly situated, as veil as those who may have been adversely
affected by the deterioration, if any, in the service of the office or bureau which
had been temporarily deprived of the services of said physician.
2. Plaintiff alleged that defendants are guilty of the crime formerly known as false
or malicious prosecution. He further alleged that he is suing the defendant not on
the ground of malicious prosecution arising from a criminal act but for
misconduct or malfeasance arising from an action ex delicto or a tortious act.
However, by specific mandate of Article 2219 of the Civil Code of Philippines,
moral damages may not be recovered in cases of crime or tort, unless either
results or causes "physical injuries," which are lacking in the case at bar. Although
the same- article permits recovery of said damages in cases of malicious
prosecution, this feature: of said provision may not be availed of by the plaintiff
herein, inasmuch as the acts set forth in the complaint took place in 1949, or
before said Code became effective.
3.. This news item mentions, neither the number of the case referred to, nor the
names of the persons accused therein, Moreover, it merely contains a criticism of
the action taken by the court. The reference, therein imputed to the Director of
Labor, to the flagrant violation of the eight-hour labor law by the accused, was a
mere reiteration of the theory of the Bureau of Labor, which the; prosecution had
adopted by filling the information in said case. Being a matter of court record,
which had been taken up at the hearing held publicly, and settled in a decision
already promulgated, said theory was open for public consumption, and, hence,
an allusion thereto or statement thereof, in order to justify said criticism, is not
actionable.
Again, said allusion was not made by defendant Ruperto, who, the news item
shows, said nothing against the plaintiff. It is apparent, therefore, that as a whole,
the allegations made in support of the second cause of action do not establish a
right of action against him. Moreover, there is absolutely no allegation under said
cause of action connecting defendant Figueras with the statement already
referred to or rendering him liable therefor.
A.M. No. RTJ-05-1896 April 29, 2005
ATTY. JULIUS NERI, Complainant, vs. JUDGE JESUS S. DE LA PEÑA, respondent.
Facts: This is a case for grave misconduct, gross ignorance of the law and/or
incompetence filed by Atty. Julius Z. Neri against Judge Jesus S. de la Peña. It
originated from a civil case for damages filed by Emmanuel Aznar against
Citibank (which was represented by complainant as counsel). Plaintiff Aznar
had filed suit due to the alleged blacklisting of his Citibank Preferred Mastercard
which, according to him, was dishonored in several establishments in Singapore
and Malaysia while he was on holiday, causing him great inconvenience and
embarrassment. Defendant Citibank presented several documentary exhibits to
the effect that Aznar's card had not been placed on any "hot list" and could not
possibly have been blacklisted. After trial, Judge Marcos dismissed the case for
lack of merit. Dissatisfied with the decision, Aznar filed through counsel a motion
for reconsideration, with motion to re-raffle the case. Acting Presiding Judge
Ramon Codilla (who succeeded Marcos), citing the fact that he was "occupied
with two (2) salas" and the fact that "the Presiding Judge who originally penned
the decision is a credit card holder of CITIBANK…whose membership could
naturally influence the outcome of this case in favor of the defendant bank,"
directed the re-raffling of the case to RTC Cebu Branch X, presided over by
respondent Judge Jesus de la Peña. Respondent then ordered Citibank to file its
comment on Aznar's motion for reconsideration. Citibank filed its opposition
instead. Respondent granted Aznar's motion for reconsideration:
WHEREFORE, the Motion for Reconsideration is hereby GRANTED. The
DECISION dated May 29, 1998 is hereby reconsidered, and consequently,
the defendant is hereby condemned liable to pay the following sums of
money:
a) P10,000,000.00 as moral damages;
b) P 5,000,000.00 as exemplary damages;
c) P 1,000,000.00 as attorney's fees; and
d) P200,000.00 as litigation expenses.
As a result of the Order, complainant filed this administrative case. Charging
respondent with dishonesty, he alleged that respondent, contrary to his
pronouncement in his order, had rendered his decision without ever having read
the transcripts of the case. To support this contention, complainant presented
certifications from the Clerk of Court of Branch XXand the Clerk of Court of the
RTC of Cebu City that the transcripts of the case had remained in their custody
and that the respondent never borrowed them all throughout. Complainant also
charged respondent with gross ignorance of the law and/or incompetence. He
alleged that respondent had improperly considered as a business record Aznar's
computer print-out which in reality did not meet the requisites to be rightly
considered as such. Complainant went on to say that respondent's incompetence
and dishonesty showed in his failure to appreciate and evaluate Citibank's
extensive documentary evidence which clearly established that it did not
blacklist Aznar's Mastercard. Finally, complainant pointed out that the
damages respondent awarded to plaintiff Aznar were scandalously
exorbitant. He prayed for respondent's dismissal from the service.
Respondent filed his comment. He principally contended that, having appealed
from his decision to the Court of Appeals, the complainant should not have filed
this administrative case. He also defended the amount of damages he awarded by
comparing them to those awarded in a 1973 case, with inflation taken into
account.
The Court of Appeals decided in favor of Citibank, vacating respondent's decision
and reinstating the dismissal of the case by Judge Marcos.
Complainant filed a manifestation, with the Court of Appeals' decision attached,
pointing out that this administrative complaint was now ready for resolution.
Respondent prayed for the resolution of the case and once more asked for its
dismissal. He cited the fact that the Court of Appeals decision made no mention
of his administrative lapses and that his decision was an exercise of purely
judicial discretion. He also listed the various posts he had held as a Regional Trial
Court judge as well as the commendations he had received from the Honorable
Chief Justice. He also pointed out that this administrative complaint was the only
one ever filed against him in all his years of service.
Office of the Court Administrator reported its findings:
Because respondent based his assailed order mostly on the ex parte
manifestation submitted by the counsel for plaintiff Aznar, the OCA found him
liable for violating Section 4, Rule 13, in relation to Section 5, Rule 15 of the
Revised Rules of Civil Procedure:
(Rule 13) SEC. 4. Papers required to be filed and served. — Every judgment,
resolution, order, pleading subsequent to the complaint, written motion, notice,
appearance, demand, offer of judgment or similar papers shall be filed with the
court, and served upon the parties affected. (Rule 15) SEC. 4. Hearing of motion.
— Except for motions which the court may act upon without prejudicing the
rights of the adverse party, every written motion shall be set for hearing by the
applicant.
According to the OCA, the fact that plaintiff Aznar had failed to serve a copy of his
ex parte manifestation upon Citibank should have been reason enough for
respondent to disregard the same.Likewise noting the fact that the ex parte
manifestation was filed beyond office hours, the OCA found that this "created an
idea that there was a covert attempt to favor Aznar." However, citing the absence
of substantial evidence, it pointed out that "it should not be presumed that the
procedural lapse committed by respondent (was) attended by corrupt motive of
flagrant disregard of the rules." The OCA also considered in respondent's favor
his defense that he was merely trying to help decongest the dockets. Finally, the
OCA found the charges of gross ignorance of law and incompetence to be without
basis, and found him liable instead for simple misconduct. The OCA
recommended a fine of P10,000.
Issue:
WON the award rendered by the respondent is justifiable
Ruling: No.
Section 4, Rule 13 requires that adverse parties be served copies of all pleadings
and similar papers. Section 4, Rule 15 requires a movant to set his motion for
hearing, unless it is one of those which a court can act upon without prejudicing
the rights of the other party. The prevailing doctrine in our jurisdiction is that a
motion without a notice of hearing addressed to the parties is a mere scrap of
paper.
The logic for such a requirement is simple: a motion invariably contains a prayer
which the movant makes to the court, which is usually in the interest of the
adverse party to oppose. The notice of hearing to the adverse party is therefore a
form of due process; it gives the other party the opportunity to properly vent his
opposition to the prayer of the movant. In keeping with the principles of due
process, therefore, a motion which does not afford the adverse party the chance
to oppose it should simply be disregarded. The same principle applies to
objections to interrogatories which also require a notice of hearing like motions
under Section 3, Rule 25 of the Rules.
However, the same cannot be said for manifestations which, unless
otherwise indicated, are usually made merely for the information of the
court. There is generally nothing to contest or argue; the manifesting party
is just making a statement for the knowledge of the court, such as in this
case. There is nothing in either the Rules or in jurisprudence that requires
judges to disregard a manifestation that does not have proof of service.
This is not to say, however, that respondent is off the hook. While it is true
that he was under no obligation to disregard Aznar's ex parte manifestation,
he should have at least called attention to its irregularity, both by
admonishing Aznar and by informing the adverse party of its filing. That he
acted on it — indeed, based his decision on it — while Citibank was totally
unaware of its existence ran seriously afoul of the precepts of fair play, specially
since respondent only mentioned the document after this administrative case
was filed against him. Indeed, there seems to be something gravely amiss in
respondent's sense of fairness and righteousness, the primary requisites of a
good judge.
Furthermore, we cannot help but find extreme bias and bad intent in
respondent's award to Aznar of a whopping P16.2 million in damages
considering that, not having tried the case himself, the only records he
actually read came from no one else but Aznar himself. By itself, the
unconscionable amount of the award evinces indubitable malice on
respondent's part and the shady circumstances in which he granted it show
that he knowingly rendered a manifestly unjust decision.
As a member of the judiciary, respondent's every action is supposed to be beyond
reproach and above suspicion. The 2004 Code of Judicial Conduct clearly states
that "Judges shall avoid impropriety and the appearance of impropriety in all of
their activities." By acting on a document which was sorely defective (for two
reasons: failure to serve a copy on the adverse party and failure to file it during
office hours), and by making an egregiously large award of damages in favor of
plaintiff Aznar, he inevitably opened himself up to suspicion of having entered
into a dirty, secret deal with Aznar and thereby severely tarnished the
impartiality with which he was at all times supposed to conduct himself.
Given respondent's actions, we disagree with the OCA's findings of simple
misconduct. Because of the highly anomalous manner in which respondent
rendered his decision, as well as the questionable content of the decision itself,
which was eventually overturned by the Court of Appeals, we find him guilty of
knowingly rendering an unjust judgment or order as determined by a competent
court in an appropriate proceeding.
The penalty for this offense ranges from a fine of P20,000, to suspension from
three to six months, to dismissal from the service. In this case, the penalty of
suspension for six months is appropriate, with a warning that another such
infraction of this nature will warrant a more severe penalty.
WHEREFORE, Judge JESUS S. DE LA PEÑA is hereby found GUILTY of knowingly
rendering an unjust judgment or order as determined by a competent court in an
appropriate proceeding and is hereby SUSPENDED from office for six months.
Considering the gravity of this offense, he is hereby warned that another
infraction of this kind will merit a penalty beyond mere suspension from public
office.
TEOFISTO I. VERCELES, Petitioner, vs. MARIA CLARISSA POSADA, in her own
behalf, and as mother of minor VERNA AIZA POSADA, CONSTANTINO
POSADA and FRANCISCA POSADA, Respondents.
G.R. No. 159785, SECOND DIVISION, April 27, 2007, QUISUMBING, J.
FACTS: Respondent Maria Clarissa Posada, a young lass from the barrio of
Pandan, Catanduanes, sometime in 1986 met a close family friend, petitioner
Teofisto I. Verceles, mayor of Pandan. He then called on the Posadas and at the
end of the visit, offered Clarissa a job.
Clarissa accepted petitioner’s offer and worked as a casual employee in the
mayor’s office. From November 10 to 15 in 1986, with companions Aster de
Quiros, Pat del Valle, Jaime and Jocelyn Vargas, she accompanied petitioner to
Legaspi City to attend a seminar on town planning. They stayed at the Mayon
Hotel.
On November 11, 1986, at around 11:00 a.m., petitioner fetched Clarissa from
"My Brother’s Place" where the seminar was being held. Clarissa avers that he
told her that they would have lunch at Mayon Hotel with their companions who
had gone ahead. When they reached the place her companions were nowhere.
After petitioner ordered food, he started making amorous advances on her. She
panicked, ran and closeted herself inside a comfort room where she stayed until
someone knocked. She said she hurriedly exited and left the hotel. Afraid of the
mayor, she kept the incident to herself. She went on as casual employee. One of
her tasks was following-up barangay road and maintenance projects.
On December 22, 1986, on orders of petitioner, she went to Virac, Catanduanes,
to follow up funds for barangay projects. At around 11:00 a.m. the same day, she
went to Catanduanes Hotel on instructions of petitioner who asked to be briefed
on the progress of her mission. They met at the lobby and he led her upstairs
because he said he wanted the briefing done at the restaurant at the upper floor.
Instead, however, petitioner opened a hotel room door, led her in, and suddenly
embraced her, as he told her that he was unhappy with his wife and would
"divorce" her anytime. He also claimed he could appoint her as a municipal
development coordinator. She succumbed to his advances. But again she kept the
incident to herself.
Sometime in January 1987, when she missed her menstruation, she said she
wrote petitioner that she feared she was pregnant. In another letter in February
1987, she told him she was pregnant. In a handwritten letter dated February 4,
1987, he replied:
My darling Chris,
Should you become pregnant even unexpectedly, I should have no regret, because
I love you and you love me. Let us rejoice a common responsibility – you and I
shall take care of it and let him/her see the light of this beautiful world. We know
what to do to protect our honor and integrity. Just relax and be happy, if true.
With all my love,
Ninoy
2/4/874
Clarissa explained petitioner used an alias "Ninoy" and addressed her as "Chris,"
probably because of their twenty-five (25)-year age gap. In court, she identified
petitioner’s penmanship which she claims she was familiar with as an employee
in his office. Clarissa presented three other handwritten letters sent to her by
petitioner, two of which were in his letterhead as mayor of Pandan. She also
presented the pictures petitioner gave her of his youth and as a public servant,
all bearing his handwritten notations at the back.
Clarissa avers that on March 3, 1987, petitioner, aware of her pregnancy, handed
her a letter and ₱2,000 pocket money to go to Manila and to tell her parents that
she would enroll in a CPA review course or look for a job. In June 1987, petitioner
went to see her in Manila and gave her another ₱2,000 for her delivery. When her
parents learned of her pregnancy, sometime in July, her father fetched her and
brought her back to Pandan. On September 23, 1987,7 she gave birth to a baby
girl, Verna Aiza Posada.
The Posadas filed a Complaint for Damages coupled with Support Pendente Lite
before the RTC, Virac, Catanduanes against petitioner on October 23, 1987.
The trial court issued a judgment in their favor. Verceles appealed to the Court of
Appeals which affirmed the judgment with modification, specifying the party to
whom the damages was awarded.
ISSUE:
1. Whether or not paternity and filiation can be resolved in an action for
damages with support pendente lite
2. Whether or not respondents are entitled to damages.
RULING:
1.
YES. The caption is not determinative of the nature of a pleading. In a string of
cases we made the following rulings. It is not the caption but the facts alleged
which give meaning to a pleading. Courts are called upon to pierce the form and
go into the substance thereof. In determining the nature of an action, it is not the
caption, but the averments in the petition and the character of the relief sought,
that are controlling.
A perusal of the Complaint before the RTC shows that although its caption states
"Damages coupled with Support Pendente Lite," Clarissa’s averments therein, her
meeting with petitioner, his offer of a job, his amorous advances, her seduction,
their trysts, her pregnancy, birth of her child, his letters, her demand for support
for her child, all clearly establish a case for recognition of paternity. We have held
that the due recognition of an illegitimate child in a record of birth, a will, a
statement before a court of record, or in any authentic writing is, in itself, a
consummated act of acknowledgement of the child, and no further court action is
required. In fact, any authentic writing is treated not just a ground for compulsory
recognition; it is in itself a voluntary recognition that does not require a separate
action for judicial approval.
The letters of petitioner marked as Exhibits "A" to "D" are declarations that lead
nowhere but to the conclusion that he sired Verna Aiza. Although petitioner used
an alias in these letters, the similarity of the penmanship in these letters vis the
annotation at the back of petitioner’s fading photograph as a youth is
unmistakable. Even an inexperienced eye will come to the conclusion that they
were all written by one and the same person, petitioner, as found by the courts a
quo.
We also note that in his Memorandum, petitioner admitted his affair with
Clarissa, the exchange of love letters between them, and his giving her money
during her pregnancy.
The letters are private handwritten instruments of petitioner which establish
Verna Aiza’s filiation under Article 172 (2) of the Family Code. In addition, the
array of evidence presented by respondents, the dates, letters, pictures and
testimonies, to us, are convincing, and irrefutable evidence that Verna Aiza is,
indeed, petitioner’s illegitimate child.
2.
NO. Article 2219 of the Civil Code which states moral damages may be
recovered in cases of seduction is inapplicable in this case because Clarissa
was already an adult at the time she had an affair with petitioner.
Neither can her parents be entitled to damages. Besides, there is nothing in law
or jurisprudence that entitles the parents of a consenting adult who begets a love
child to damages. Respondents Constantino and Francisca Posada have not cited
any law or jurisprudence to justify awarding damages to them.
DISPOSITIVE PORTION:
WHEREFORE, the assailed Decision dated May 30, 2003 and the Resolution dated
August 27, 2003 of the Court of Appeals in CA-G.R. CV No. 50557 are AFFIRMED,
with the MODIFICATION that the award of moral damages and exemplary
damages be DELETED. SO ORDERED.
BAGUMBAYAN CORPORATION, petitioner,
vs.
INTERMEDIATE APPELLATE COURT, LELISA SEÑA and ARTURO SEÑA
respondents.
G.R. No. L-66274 September 30, 1984 AQUINO, J.:
FACTS: This case is about the customer's claims for moral and exemplary
damages due to the alleged negligence of a waiter. The spouses Lelisa Seña and
Arturo Seña and their four children went to the Tropical Palace Hotel to see the
Reycard Duet Show. They occupied a table and ordered drinks before the show.
Lelisa's version was that when a waiter named Baez was going to serve the tray
containing the drinks was overturned and fell on her. She was drenched. Later,
she felt some chill. The drinks and the splinters from the broken glasses allegedly
destroyed her dress which, with her handbag and shoes, cost one thousand pesos.
She was shocked. She sensed that some persons were laughing at or pitying her.
A waitress took Lelisa to the ladies' room. She had to remove her dress and
underwear which were wet. She was not given any towel to cover herself. She
remained standing as there was no chair. She returned to the hag after about
thirty minutes later when the show had started.
Lelisa testified that she was claiming moral damages of P100,000 for herself and
her husband due to embarrassment and the fact that the management did not
even offer any apology on that night. She was claiming exemplary damages in the
same amount to teach the management a lesson. The husband, Arturo Seta,
testified that the incident infuriated him. There was no apology from the
management.
Rudy Tanchanco, the food and beverage manager, was one of three persons in
charge of the show. He testified that the admission was on a "first come, first
served" basis. In open court, Tanchanco apologized to the plaintiffs in behalf of
the management for the inconvenience caused to them, meaning that the
management was sorry for what happened to Mrs. Seta.
The Señas sued the corporation, as employer of the waiter, for actual damages of
P200,000 plus attorney's fees of P10,000 and such moral and exemplary damages
as might be fixed by the court. The action involves a quasi-delict. It was based on
articles 2176 and 2180 of the Civil Code.
After hearing, the trial court awarded the Señas P1,540 as actual damages
consisting of the value of Mrs. Seña's outfit and P540, the cost of the six tickets
used by the Seña family which was considered a loss because of their alleged
failure to enjoy the show. It also awarded the Señas P50,000 as moral damages,
P10,000 as exemplary damages and P5,000 as attorney's fees.
The corporation appealed. The Intermediate Appellate Court affirmed the
judgment with the modification that the moral and exemplary damages were
reduced to P15,000 and P5,000, respectively. Hence, this appeal.
ISSUE: WHETHER OR NOT THE RESPONDENTS ARE ENTITLED TO AN
AWARD OF MORAL DAMAGES.
RULING: NO.
While the award for actual damages has some basis, the grant of moral and
exemplary damages is devoid of legal justification because it was not predicated
upon any of the cases enumerated in the Civil Code:
ART. 2217. Moral damages include physical suffering, mental anguish,
fright, serious anxiety, besmirched reputation, wounded feelings, moral
shock, social humiliation, and similar injury. Though incapable of
pecuniary computation, moral damages may be recovered if they are the
proximate result of the defendant's wrongful act or omission.
ART. 2219. Moral damages may be recovered in the following and
analogous cases:
(1) A criminal offense resulting in physical injuries; (2) Quasi-delicts
causing physical injuries; (3) Seduction, abduction, rape, or other
lascivious acts; (4) Adultery or concubinage; (5) Illegal or arbitrary
detention or arrest; (6) Illegal search; (7) Libel, slander or any other
form of defamation; (8) Malicious prosecution; (9) Acts mentioned in
article 309; (10) Acts and actions referred to in articles 21, 26, 27, 28, 29,
30, 32, 34, and 35.
The parents of the female seduced, abducted, raped, or abused, referred
to in No. 3 of this article, may also recover moral damages.
The spouse descendants, ascendants, and brothers and sisters may bring
the action mentioned in No. 9 of this article, in the order named.
ART. 2220. Willful injury to property may be a legal ground for awarding moral
damages if the court should find that, under the circumstances, such damages are
justly due. The same rule applies to breaches of contract where the defendant
acted fraudulently or in bad faith.
The instant case is not specifically mentioned in article 2219 which refers to
quasi-delicts causing physical injuries. The Appellate Court erred in considering
it as analogous to the cases mentioned therein without indicating what specific
case the instant case resembles or is analogous to.
Based from jurisprudence:
Generally, there can be no recovery of moral damages if the case is not mentioned
in articles 2219 and 2220.
What we call moral damages are treated in American jurisprudence as
compensatory damages awarded for mental pain and suffering or mental anguish
resulting from a wrong.
Mental suffering means distress or serious pain as distinguished from annoyance,
regret or vexation. Mental anguish is intense mental suffering.
Generally, damages for mental anguish are limited to cases in which there has
been a personal physical injury or where the defendant wilfully, wantonly,
recklessly, or intentionally caused the mental anguish.
"Nor will damages generally be awarded for mental anguish which is not
accompanied by a physical injury, at least where maliciousness, wantonness, or
intentional conduct is not involved"
"Damages for mental anguish and suffering have been held recoverable where
the act complained of was done with such gross carelessness or recklessness as
to show an utter indifference to the consequences.
In Chicago, R.I. & P. Ry Co. vs. Caple, 179 S.W. 2nd 151, it was held that where the
act is wanton or willful there may be a recovery for humiliation and mental
suffering without any physical injury. It was further held that in negligence cases,
where there is no willful or wanton wrong, there can be no recovery for mental
suffering unless there is also physical injury.
We hold that the "embarrassment" to which Mrs. Seña was exposed by the
incident is not the mental anguish contemplated in article 2217 for which moral
damages can be recovered. In this case, it would not be just and proper to include
moral damages in the corporation's vicarious liability as employer. The award of
P5,000 as exemplary or corrective damages cannot also be sustained because
there was no gross negligence in this case.
EQUITABLE BANKING CORPORATION, petitioner, vs. INTERMEDIATE
APPELLATE COURT, ZENIA VILLARIZA, ARMANDO VILLARIZA and
FERNANDO N. CONTRERAS, respondents.
G.R. No. L-66070, SECOND DIVISION, October 31, 1984, AQUINO, J.:
FACTS:
This case is about the recovery of moral and exemplary damages allegedly
because of a collection suit for P250 which was paid one day after the suit
was filed. The theory of lawyer Fernando N. Contreras is that it was a
malicious prosecution against him. On the other hand, the bank's theory
is that the claim of P80,000 for moral damages is bereft of rhyme or
reason.
The Villariza spouses, with Contreras as co-maker, borrowed from the
Davao City branch of the Equitable Banking Corporation P1,000. The
amount was due on December 7, 1976. Only P250 was paid on that date.
Another P250 was paid on March 7, 1977. The payment of the balance of
P500 was extended. On July 27, 1977, the sum of P250 was paid. The
remaining balance of P250 was due on or before September 6, 1977. As it
was not paid, its collection was indorsed to the bank's lawyers on October
25, 1977.
On December 21,977, lawyer Oscar G. Tirol phoned Contreras about the
unpaid balance. He was reluctant to bring the matter to the court.
Contreras told Tirol to do his job and file the complaint or that since Tirol
was paid to file the case, he should file it. The next day, December 22, Tirol
filed a collection case in Branch 3 of the city court against Contreras and
the Villariza spouses. It was prayed therein that the defendants be
ordered to pay the bank P250 plus 14% interest a year and 10% of the
amount due as attorney's fees.
It is a question whether Contreras was aware of the filing of that suit, since
Zenia Villariza was an employee of Branch 4 of the court. The fact is that
on the following day Contreras paid the bank P250 but he did not pay the
accrued interest and costs. Apparently unaware of the collection suit, the
bank informed Tirol of that payment only about a week later. Contreras
did not apprise Tirol of his payment. Summons was served on the Villariza
spouses but, contrary to Contreras' pretension summons was never served
upon him because the sheriff could not contact him. Nevertheless,
Contreras' law firm filed an answer to the complaint.Tirol, having become
aware of Contreras' payment filed a notice of dismissal. The city judge
dismissed the complaint and counterclaim.
Contreras and the Villariza spouses filed against the bank the instant case
wherein they prayed for moral damages of P80,000, attorney's fees of
P10,000, reimbursement of litigation expenses and exemplary damages
of not less than P10,000. They claimed that the collection suit greatly
disturbed them and caused them mental anguish, besmirched reputation,
wounded feelings, social humiliation and sleepless nights.
The trial court rendered judgment for the "plaintiff", meaning Contreras
only and excluding the Villarizas, ordering the bank to pay him P40,000
as moral and exemplary damages and P6,000 as attorney's fees and
litigation expenses. The Appellate Court affirmed in toto that judgment.
ISSUE:
Whether or not there was malicious prosecution of Contreras. (NO)
RULING:
We hold that the trial court and the Appellate Court erred in holding that
there was malicious prosecution within the meaning of articles 2217 and
2219(8) of the Civil Code. The action to collect the P250 was filed with
uberrima fides. It was not an act of malevolence designed to harass or
embarrass Contreras. The amount was overdue. The complaint was
dismissed before summons was served on Contreras.

Generally, denuncia falsa or malicious prosecution refers to unfounded
criminal actions. The term has been expanded to include unfounded civil
suits instituted just to vex and humiliate the defendant despite the
absence of a cause of action or probable cause. In this case, Contreras filed
in the municipal court a counterclaim for P80,000 which he announced
would be the object of a separate complaint in the proper forum. His
answer was a voluntary appearance because, as already noted, he was not
served with summons.
As observed by Chief Justice Fernando, the expenses and annoyance of
litigation form part of the social burden of living in a society which seeks
to attain social control through law. A long catena of cases supports the
proposition that moral /damages are not recoverable for unsuccessful
suits filed in good faith.
With respect to the award for exemplary or corrective damages, the same
is likewise devoid of any legal and factual basis. We have found that
Contreras' claim of malicious prosecution is more imaginary than real.
The bank's last contention is that Contreras was the one motivate by
malevolence or ill-will in bringing this action. Therefore, the bank's
counterclaim for moral damages of P25,000 and litigation expenses of
P10,000 should be allowed.The dictates of justice do not sanction that
contention. As a rule, there should be no penalty on the right to litigate.
The bank's counterclaim is dismissed.
DISPOSITIVE PORTION:
WHEREFORE, the decisions of the Appellate Court and the trial court are
reversed and set aside. The complaint is dismissed. No costs.
SO ORDERED.
TANAY RECREATION CENTER AND DEVELOPMENT CORP.,
Petitioners, vs. CATALINA MATIENZO FAUSTO* and ANUNCIACION
FAUSTO PACUNAYEN, Respondents.
FACTS: Tanay Recreation Center and Development Corp. (TRCDC) is the
lessee of a 3,090-square meter property located in Rizal, owned by
Catalina Matienzo Fausto, under a Contract of Lease. On this property
stands the Tanay Coliseum Cockpit operated by TRCDC. The lease
contract provided for a 20-year term, subject to renewal within sixty days
prior to its expiration. The contract also provided that should Fausto
decide to sell the property, TRCDC shall have the "priority right" to
purchase the same.
TRCDC wrote Catalina Fausto (Fausto) informing her of its intention to
renew the lease. However, it was Fausto’s daughter, respondent
Anunciacion F. Pacunayen (Pacunayen), who replied, asking that
petitioner remove the improvements built thereon, as she is now the
absolute owner of the property. It appears that Fausto had earlier sold the
property to Pacunayen on for the sum of ₱10,000.00 under a "Kasulatan
ng Bilihan Patuluyan ng Lupa," and title has already been transferred in
her name.
Despite efforts, the matter was not resolved. Hence, TRCDC filed an
Amended Complaint for Annulment of Deed of Sale, Specific Performance
with Damages, and Injunction. After trial on the merits, the Regional Trial
Court (RTC) rendered judgment extending the period of the lease for
another seven years at a monthly rental of ₱10,000.00, and dismissed
petitioner’s claim for damages. The CA affirmed with modifications the
trial court’s judgment.
ISSUE: WON TRCDC’s claim for moral damages should prosper
RULING: NO. The award of moral damages cannot be granted in favor of
a corporation because, being an artificial person and having existence
only in legal contemplation, it has no feelings, no emotions, no senses. It
cannot, therefore, experience physical suffering and mental anguish,
which can be experienced only by one having a nervous system. TRCDC,
being a corporation, the claim for moral damages must be denied.
WHEREFORE, the instant Petition for Review is PARTIALLY GRANTED. The
Court of Appeals’ Decision dated June 14, 1999 in CA-G.R. CV No. 43770 is
MODIFIED as follows:
(1) the "Kasulatan ng Bilihan Patuluyan ng Lupa" dated August 8, 1990
between Catalina Matienzo Fausto and respondent Anunciacion Fausto
Pacunayen is hereby deemed rescinded;
(2) The Heirs of the deceased Catalina Matienzo Fausto who are hereby
deemed substituted as respondents, represented by respondent Anunciacion
Fausto Pacunayen, are ORDERED to recognize the obligation of Catalina
Matienzo Fausto under the Contract of Lease with respect to the priority right
of petitioner Tanay Recreation Center and Development Corp. to purchase
the subject property under reasonable terms and conditions;
(3) Transfer Certificate of Title No. M-35468 shall remain in the name of
respondent Anunciacion Fausto Pacunayen, which shall be cancelled in the
event petitioner successfully purchases the subject property;
(4) Respondent is ORDERED to pay petitioner Tanay Recreation Center and
Development Corporation the amount of Twenty Thousand Pesos
(₱20,000.00) as actual damages, plus interest thereon at the legal rate of six
percent (6%) per annum from the filing of the Complaint until the finality of
this Decision. After this Decision becomes final and executory, the applicable
rate shall be twelve percent (12%) per annum until its satisfaction; and,
(5) Respondent is ORDERED to pay petitioner the amount of Ten Thousand
Pesos (₱10,000.00) as attorney’s fees, and to pay the costs of suit.
(6) Let the case be remanded to the Regional Trial Court, Morong, Rizal
(Branch 78) for further proceedings on the determination of the "reasonable
terms and conditions" of the offer to sell by respondents to petitioner,
without prejudice to possible mediation between the parties.
The rest of the unaffected dispositive portion of the Court of Appeals’
Decision is AFFIRMED.
SO ORDERED.
CHAPTER IV: NOMINAL DAMAGES
A. Concept and Definition
ROBERTO P. FUENTES, petitioner, vs. PEOPLE OF THE PHILIPPINES,
respondent. | G.R. No. 186421, FIRST DIVISION, April 17, 2017, PERLAS-
BERNABE, J.
FACTS:
On January 8, 2002 and for sometime prior or subsequent thereto at the
Municipality of Isabel, Leyte, Roberto P. Fuentes, being the Municipal Mayor or
Isabel, Leyte, in such capacity and committing the offense in relation to office,
with evident bad faith and manifest partiality, did then and there, willfully,
unlawfully and criminally cause undue injury to private complainant Fe N.
Valenzuela by then and there refusing for unreasonable length of time, to renew
the latter's Business Permit to engage in Ship Chandling Services in the Port of
Isabel without any legal basis or reason despite the fact that Fe N. Valenzuela has
complied with all the requirements and has been operating the Ship Chandling
Services in the Port of Isabel since 1993, which act caused damage to the
perishable ship provisions of Fe N. Valenzuela for M/V Ace Dragon and a denial
of her right to engage in a legitimate business thereby causing damage and
prejudice to Fe N. Valenzuela.
In his defense, Fuentes averred that as early as 1999, 2000, and 2001, he has been
hearing rumors that Valenzuela was engaged in illegal activities such as
smuggling and drug trading, but he did not act on the same. However, in 2002, he
received written reports from the Prime Movers for Peace and Progress and
Isabel Chief of Police Tamse allegedly confirming the said rumors, which
prompted him to hold the approval of Valenzuela’s Business Permit for Triple A,
and to issue the unnumbered Memorandum addressed to port officials and the
BOC. Fuentes maintained that if he went on with the approval of such permit and
the rumors turned out to be true, many will suffer and will be victimized; on the
other hand, if the rumors were false, then only one stands to suffer. Further,
Fuentes presented corroborative testimonies of other people, essentially: (a)
refuting Valenzuela’s claim that Triple A was unable to resume operations due to
lack of Business Permit; and (b) accusing Valenzuela of pulling out her
application for Business Permit from the Mayor’s Office, which precluded
Fuentes from approving the same.
The Sandiganbayan convicted Fuentes of violation of Article 3 (e) of Republic Act
No. (RA) 3019, entitled the "Anti-Graft and Corrupt Practices Act. Accordingly,
the court sentenced him to suffer the penalty of imprisonment for an
indeterminate period of six (6) years and one (1) month, as minimum, to ten (10)
years and six (6) months, as maximum, with perpetual disqualification from
public office, and ordered to pay Valenzuela the amount of P200,000.00 as
nominal damages.
Hence, the appeal.
ISSUE/S:
Whether or not the Sandiganbayan correctly convicted Fuentes of the crime of
violation of Section 3 (e) of RA 3019. (YES)
Whether or not the Sandiganbayan is correct to award nominal damages. (NO)
RULING:
Whether or not the Sandiganbayan correctly convicted Fuentes of the crime of
violation of Section 3 (e) of RA 3019.
YES, the Court is convinced that the Sandiganbayan correctly convicted Fuentes
of the crime charged.
The elements of violation of Section 3 (e) of RA 3019 are as follows: (a) that the
accused must be a public officer discharging administrative, judicial, or official
functions (or a private individual acting in conspiracy with such public officers);
(b) that he acted with manifest partiality, evident bad faith, or inexcusable
negligence; and (c) that his action caused any undue injury to any party, including
the government, or giving any private party unwarranted benefits, advantage, or
preference in the discharge of his functions.
Anent the first element, it is undisputed that Fuentes was a public officer, being
the Municipal Mayor of Isabel, Leyte at the time he committed the acts
complained of.
As to the second element, it is worthy to stress that the law provides three modes
of commission of the crime, namely, through "manifest partiality", "evident bad
faith", and/or "gross negligence." In Coloma, Jr. v. Sandiganbayan, the Court
defined the foregoing terms as follows:
"Partiality" is synonymous with "bias" which "excites a disposition to see
and report matters as they are wished for rather than as they are." "Bad
faith does not simply connote bad judgment or negligence; it imputes a
dishonest purpose or some moral obliquity and conscious doing of a
wrong; a breach of sworn duty through some motive or intent or ill will;
it partakes of the nature of fraud.""
Anent the third and last element, suffice it to say that Fuentes's acts of refusing to
issue a Business Permit in Valenzuela's favor, coupled with his issuance of the
unnumbered Memorandum which effectively barred Triple A from engaging in
its ship chandling operations without such Business Permit, caused some sort of
undue injury on the part of Valenzuela. Undeniably, such suspension of Triple A's
ship chandling operations prevented Valenzuela from engaging in an otherwise
lawful endeavor for the year 2002. To make things worse, Valenzuela was also
not issued a Business Permit for the years 2003, 2004, 2005, and 2006, as it was
only in 2007 that such permit was issued in Triple A's favor. Under prevailing
case law, "proof of the extent of damage is not essential, it being sufficient that
the injury suffered or the benefit received is perceived to be substantial enough
and not merely negligible."
In view of the foregoing, Fuentes committed a violation of Section 3 (e) of RA
3019, and hence, must be held criminally liable therefor.
Whether or not the Sandiganbayan is correct to award nominal damages.
NO.
As defined under Article 2221 of the Civil Code, nominal damages are
“recoverable where a legal right is technically violated and must be vindicated
against an invasion that has produced no actual present loss of any kind or where
there has been a breach of contract and no substantial injury or actual damages
whatsoever have been or can be shown.” In this case, however, it is clear that
Valenzuela suffered some sort of pecuniary loss due to the suspension of Triple
A’s ship chandling operations, albeit the amount thereof was not proven with
certainty. Thus, the award of temperate, and not nominal, damages, is
proper. The Court’s pronouncement in Evangelista v. Spouses Andolong is
relevant on this matter:
In contrast, under Article 2224 of the Civil Code, temperate or moderate
damages may be recovered when the court finds that some pecuniary
loss has been suffered but its amount cannot, from the nature of the case,
be provided with certainty.
The court is of the belief that temperate and not nominal damages should have
been awarded, considering that it has been established that respondent herein
suffered a loss, even if the amount thereof cannot be proven with certainty.
Consequently, in computing the amount of temperate or moderate damages, it is
usually left to the discretion of the courts, but the amount must be reasonable,
bearing in mind that temperate damages should be more than nominal but less
than compensatory.
Here, the court is convinced that respondent sustained damages to its conveyor
facility due to petitioner’s negligence. Nonetheless, for failure of respondent to
establish by competent evidence the exact amount of damages it suffered, the
court is constrained to award temperate damages. Considering that the lower
courts have factually established that the conveyor facility had a remaining life of
only five of its estimated total life of ten years during the time of the collision,
then the replacement cost of P7,046,351.84 should rightly be reduced to 50% or
P3,523,175.92. This is a fair and reasonable valuation, having taking into account
the remaining useful life of the facility.
Under these circumstances, the Court holds that the award of temperate damages
in the amount of P300,000.00 is proper, considering that Valenzuela’s net income
from the previous year, 2001, was P750,000.00. Further, such amount shall earn
legal interest of six percent (6%) per annum from finality of this Decision until
fully paid, in light of prevailing jurisprudence.
DISPOSITIVE PORTION:
WHEREFORE, the petition is DENIED. The Decision dated September 30, 2008
and the Resolution dated February 16, 2009 of the Sandiganbayan in Crim. Case
No. 28342 are hereby AFFIRMED. Petitioner Roberto P. Fuentes is found GUILTY
beyond reasonable doubt of violating Section 3(e) of Republic Act No. 3019,
entitled the “Anti-Graft and Corrupt Practices Act,” and accordingly, sentenced to
suffer the penalty of imprisonment for an indeterminate period of six (6) years
and one (1) month, as minimum, to ten (10) years and six (6) months, as
maximum, with perpetual disqualification from public office, and is ordered to
pay private complainant Fe Nepomuceno Valenzuela the amount of P300,000.00
as temperate damages, with legal interest of six percent (6%) per annum from
finality of this Decision until fully paid. SO ORDERED.
- SAB
C. When Awarded, Articles 2222 and 2223, New Civil Code
EMERENCIANA M. VDA. DE MEDINA, ET AL., Plaintiffs-Appellees, vs.
GUILLERMO CRESENCIA, ET AL., Defendants. GUILLERMO CRESENCIA,
Appellant.
G.R. No. L-8194, EN BANC, July 11, 1956, REYES, J.B.L., J.
FACTS:
A passenger jeep driven by Brigido Avorque smashed into a Meralco post on
Azcarraga street, resulting in the death of Vicente Medina (passenger). A criminal
case for homicide thru reckless imprudence was filed against driver to which he
pleaded guilty. The heirs of Medina reserved their right to file a separate action
for damages and brought suit against the driver and Cresencia (registered owner
and operator of jeep). Cresencia disclaimed liability saying that he had sold the
jeep in question to Cudiamat (and that there were many subsequent sales after
that until it was purchased by Rosario Avorque). The complaint was amended to
include Rosario who admitted to buying the jeep but denied being the public
utility operator of the same. C & R made manifestations admitting that based on
the records of the Motor Vehicles Office and Public Service Commission,
Cresencia was still the registered operator of the jeep while Rosario was the
owner at the time of the accident.
Lower court: as far as the public is concerned, Cresencia is still the owner and is
liable solidarily with Brigido.
ISSUE:
1. Whether or not Cresencia is liable with Brigido.
2. Whether or not the award of nominal damages was proper.
RULING:
1. YES. As held in the case of Montoya v Ignacio: Sec. 20 (g) CA No. 146 as
amended, requires approval of the Public Service Commission (PSC) in order a
franchise/any privilege pertaining thereto may be sold/leased without infringing
the certificate issued to the grantee. This means that:
(1) if property covered by the franchise is transferred/leased without this
requisite approval, the transfer isn’t binding against the public or the PSC; and
(2) in contemplation of law the grantee of record continues to be responsible
under the franchise in relation to the Commission and to the public.
Since a franchise is personal in nature any transfer or lease thereof should be
notified to the Public Service Commission so that the latter may take proper
safeguards to protect the interest of the public In fact, the law requires that,
before the approval is granted, there should be a public hearing, with notice to
all interested parties, in order that the Commission may determine if there are
good and reasonable grounds justifying the transfer or lease of the property
covered by the franchise, or if the sale or lease is detrimental to public interest.
As the sale of the jeepney here in question was admittedly without the approval
of the Public Service Commission, appellant herein, Guillermo Cresencia, who
is the registered owner and operator thereof, continued to be liable to the
Commission and the public for the consequences incident to its operation.
Plaintiffs' action for damages is independent of the criminal case filed against
Brigido Avorque, and based, not on the employer's subsidiary liability under the
Revised Penal Code, but on a breach of the carrier's contractual obligation to
carry his passengers safely to their destination (culpa contractual). And it is also
for this reason that there is no need of first proving the insolvency of the driver
Brigido Avorque before damages can be recovered from the carrier, for in culpa
contractual, the liability of the carrier is not merely subsidiary or secondary, but
direct and immediate
2. NO. While the award is not questioned, the Court said that the award of nominal
damages in this case is untenable since the same cannot co-exist with
compensatory damages. The purpose for nominal damages is to vindicate or
recognize a right that has been violated and not to indemnify the plaintiff for any
loss suffered by him (Art 2221, 2223 NCC). Since the LC already awarded
compensatory and exemplary damages, the award for nominal damages is
unnecessary and improper.
-Rochelle
NORTHWEST AIRLINES, INC., petitioner, vs. NICOLAS L. CUENCA and COURT
OF APPEALS (SPECIAL SIXTH DIVISION), respondents.
G.R. No. L-22425 August 31, 1965
FACTS:
Respondent Nicolas L. Cuenca was the Commissioner of Public Highways; he was
the official delegate of the Philippines to a conference in Tokyo and, thus, he
purchased a first class ticket from petitioner Northwest Airlines, Inc. His ticket
was marked “W/L” meaning he was waitlisted but his attention was never called
thereto and he wasn’t advised what it meant.
Cuenca was given first class accommodation upon boarding the plane in Manila
but, upon arrival at Okinawa, he was transferred to the tourist class. Although he
revealed that he was traveling in his official capacity, an agent of Northwest
rudely compelled him in the presence of other passengers to move, over his
objection, to the tourist class, under threat of otherwise leaving him in Japan.
Cuenca brought suit in the CFI in Manila which held Northwest liable for
damages; this was affirmed by the CA.
ISSUE:
1. Whether Cuenca have a cause of action against Northwest – YES.
2. Whether the award of nominal damages proper – YES.
RULING:
1. The instances specified in Arts. 17-19 of the Warsaw Convention merely
declare the carrier liable for damages in the enumerated cases, if the
conditions therein specified are present.
Neither said provisions nor others in the aforementioned Convention regulate or
exclude liability for other breaches of contract by the carrier.
Otherwise, an air carrier would be exempt from any liability for damages in the
event of its absolute refusal, in bad faith, to comply with a contract of carriage.
Thus, Cuenca has a cause of action for breach of contract against Northwest.
2. The award of nominal damages is proper considering that the CA has
adjudicated no compensatory, moral, and exemplary damages to Cuenca.
Also, it is proper considering the following circumstances:
1. Cuenca was never advised that he was merely waitlisted;
2. After having been given first class accommodation in Manila, Cuenca
was entitled to believe that his first class reservation was confirmed
and would continue until his ultimate destination, Tokyo;
3. Notwithstanding this, Northwest rudely breached the contract, even
with full knowledge of the fact that Cuenca was an official
representative of the Philippines;
4. Northwest never explained that the person to whom Cuenca’s first
class seat was given had a better right thereto.
At any rate, considering the Northwest’s agent had acted in a wanton, reckless,
and oppressive manner, said award may also be considered as one for exemplary
damages.
ROMEL P. ALMEDA, in substitution of the late PONCIANO L. ALMEDA
and/or ALMEDA, INC., petitioners, vs. LEONOR A. CARIÑO, the surviving
spouse, and his children, namely: ROSARIO C. SANTOS, REMEDIOS C.
GALSIM, RAMON A. CARIÑO, REGINALDO A. CARIÑO, RANIEELA C. DIONELA
and RACHELLE C. SAMANIEGO, in substitution of the late AVELINO G.
CARIÑO, respondents.
G.R. No. 152143 January 13, 2003 MENDOZA, J.
FACTS:
On April 30, 1980, Ponciano L. Almeda and Avelino G. Cariño, predecessors-in-
interest of petitioners and respondents, entered into two agreements to sell, one
covering eight titled properties and another three untitled properties, all of
which are located in Biñan, Laguna. The agreed price of the eight titled properties
was P1,743,800.00, 20% of which was to be paid upon the signing and execution
of the agreement and the balance to be paid in four equal semi-annual
installments, beginning six months from the signing thereof, with the balance
earning 12% interest per annum. On the other hand, the purchase price of the
three untitled properties was P1,208,580.00, 15% of which was to be paid upon
the signing and execution of the agreement, and the balance, bearing a 12%
annual interest from the signing thereof, to be paid as follows: 15% of the
purchase price plus interest to be paid upon the issuance of titles to the lots, and
the balance plus interests to be paid in semi-annual installments starting from
the date of issuance of the respective certificates of title to the lots involved,
which must be not later than March 30, 1982.
On April 3, 1982, Cariño and Almeda executed an amendment to their agreements
to sell (a) extending the deadline for the production of the titles to the untitled
properties from March 31, 1982 to June 30, 1982, (b) providing for a partial
payment of P300,000.00 for the titled properties, (c) requiring Cariño to render
an accounting of the proceeds of the sugar cane crop on the properties subject of
the sale up to the 1982 harvest season and (d) obliging the vendor (Cariño) to
pay the vendee (Almeda) the sum of P10,000.00 a month in case of the failure of
the former to produce the certificates of title to the untitled properties by June
30, 1982.
Before the end of April 1982, Almeda asked Cariño for the execution of a Deed of
Absolute Sale over the eight titled properties although they had not been fully
paid. Cariño granted the request and executed on May 3, 1982 the deed of sale
over the eight titled lots in favor of Almeda, Inc. On April 30, 1982, Almeda
executed an undertaking7 to pay Cariño the balance of the purchase price. Deeds
of sale for two of the three untitled lots were also executed on July 2, 1982 and
October 9, 1982.8
Subsequently, Cariño made demands for the full and final payment of the balance
due him in the amount of P477,589.47 and the interests thereon. Despite demand
letters sent to Almeda on March 9, 1983 and on July 20, 1983, however, the
balance was not paid. Hence, Cariño filed before the RTC of Biñan a complaint
against Almeda and Almeda, Inc., in whose name the titles to the properties had
been transferred. Cariño prayed that Almeda and/or Almeda, Inc. be ordered to
pay to him the balance of P477,589.47, the legal interests thereon from demand
until full payment, 15% of all the amounts due, including interests as attorney’s
fees, P10,000.00 as litigation expenses, P100,000.00 as moral, exemplary and
nominal damages and the costs of suit.
Almeda and Almeda, Inc. contended that the purchase price, including interest
charges, of the eight titled properties had been fully paid as of April 3, 1982. With
respect to the three untitled lots, they contended that the purchase price of Lot
Nos. 2272 and 2268-B had likewise been fully paid, while that of Lot No. 3109
had only a remaining balance of P167,522.70.
The RTC of Biñan, Laguna found the claim of Cariño to be well founded and gave
judgment in his favor . Without questioning the amount of judgment debt for
which they were held liable, Ponciano Almeda and Almeda, Inc. appealed to the
Court of Appeals for a modification of judgment, contending that the lower court
erred in awarding nominal damages and attorney’s fees in favor of Cariño and
imposing a 12% annual interest on the judgment debt from the time of demand
on March 9, 1983 until it was fully paid.
During the pendency of the case, Almeda died. He was substituted by his heirs,
namely, his wife Eufemia P. Almeda and their children, Elenita A. Cervantes,
Susan A. Alcazar, Florecita A. Datoc, Laurence P. Almeda, Edwin P. Almeda,
Marlon P. Almeda, Wenilda A. Diaz, Carolyn A. Santos, Alan P. Almeda and Romel
P. Almeda, the last having been designated to act as their representative. 9
The Court of Appeals affirmed the decision of the lower court. It held that the
award of nominal damages was justified by the unjust refusal of Almeda and
Almeda, Inc. to settle and pay the balance of the purchase price in violation of the
rights of Cariño. The award of attorney’s fees was also affirmed, it being shown
that Cariño was forced to litigate to protect his interests. Finally, the appeals
court also affirmed the 12% interest rate per annum, as agreed upon by the
parties in their contracts, following Art. 2209 of the Civil Code. The appeals court
also ruled that the amount of the unpaid purchase price, P477,589.47, should be
awarded to Cariño, considering the failure of Almeda and/or Almeda, Inc. to
respond to the two demand letters and the computation sheet sent to them by
Cariño, as well as their failure to rebut the correctness of the outstanding balance
before the lower court.
ISSUES:
Whether or not:
I. THE COURT OF APPEALS ERRED IN AWARDING NOMINAL
DAMAGES IN THE AMOUNT OF P150,000.00.
II. THE COURT OF APPEALS ERRED IN AWARDING
ATTORNEY’S FEES IN THE AMOUNT OF P15,000.00 IN FAVOR OF
THE RESPONDENT.
III. THE COURT OF APPEALS ERRED IN ORDERING THE
PETITIONER TO PAY JOINTLY AND SEVERALLY THE AMOUNT OF
P477,589.47 WITH A 12% RATE OF INTEREST PER ANNUM FROM
THE DATE OF DEMAND ON MARCH 9, 1983 UNTIL FULLY PAID
RULING:
In this appeal, petitioners do not dispute the amount of the outstanding
balance on the purchase price of the lots. Petitioners only seek a modification of
the decision of the appeals court insofar as it upheld the trial court’s award of
nominal damages, attorney’s fees, and 12% interest. We find their appeal to be
without merit and, accordingly, affirm the decision of the Court of Appeals.
First. Petitioners contend that the trial court erred in awarding nominal
damages in favor of respondents since there was no showing that they acted in
an unfair, reckless or malevolent manner so as to justify such an award.
Nominal damages may be awarded to a plaintiff whose right has been violated or
invaded by the defendant, for the purpose of vindicating or recognizing that right,
and not for indemnifying the plaintiff for any loss suffered by him. Its award is
thus not for the purpose of indemnification for a loss but for the recognition and
vindication of a right. Indeed, nominal damages are damages in name only and
not in fact. When granted by the courts, they are not treated as an equivalent of a
wrong inflicted but simply a recognition of the existence of a technical injury. A
violation of the plaintiff’s right, even if only technical, is sufficient to support an
award of nominal damages. Conversely, so long as there is a showing of a
violation of the right of the plaintiff, an award of nominal damages is
proper.
Applying such principles to the instant case, we have on record the fact that
petitioners have an unpaid balance on the purchase price of lots sold to them by
respondents. Their refusal to pay the remaining balance of the purchase price
despite repeated demands, even after they had sold the properties to third
parties, undoubtedly constitutes a violation of respondents’ right to the said
amount under their agreements. The facts show that the right of the vendor to
receive the unpaid balance to the lots sold was violated by petitioners, and this
entitles respondents at the very least to nominal damages.
Second. Petitioners claim that the imposition of a 12% annual interest rate is
erroneous because it is contrary to law and jurisprudence. According to them, the
applicable rate is 6% since the case does not involve a loan or forbearance of
money.
This contention is without merit. Art. 2209 of the Civil Code provides:
If the obligation consists in the payment of a sum of money, and the debtor
incurs in delay, the indemnity for damages, there being no stipulation to
the contrary, shall be the payment of the interest agreed upon, and in the
absence of stipulation, the legal interest, which is six per cent per annum.
The contracts to sell of the parties stipulated that the balance of the purchase
price shall earn an interest rate of 12% per annum upon signing of the contract.
Such stipulations have the force of law between the contracting parties and
should be complied with by them in good faith. The interest in this case should
be allowed to run from March 9, 1993, respondents’ extrajudicial demand for
payment of the remaining balance plus interest having begun on said date.
In addition, in accordance with our decision in Eastern Shipping Lines, Inc. v. Court
of Appeals, when the judgment of the court awarding the sum of money becomes
final and executory, a 12% legal interest per annum shall also be imposed from
such finality until satisfaction thereof, this interim period being deemed to be by
then an equivalent to a forbearance of credit.
Third. Nor is there any basis for petitioners’ claim that the appellate court erred
in awarding attorney’s fees in favor of respondents. Under the Civil Code,
attorney’s fees and litigation expenses can be recovered in cases where the court
deems it just and equitable.18 We see no reason therefore to set aside the order
of the trial court, as affirmed by the appeals court, granting to respondents
attorney’s fees in the amount of P15,000.00.
Fourth. We observe that this case has dragged on for more than a decade. While
the records reveal that respondents engaged the services of two lawyers,
petitioners had a total of sixteen counsels starting from January 24, 1984 up to
December 22, 1997. Of the sixteen, one lawyer served for more than 2 years,
another for 8 days only, and still another entered his appearance and withdrew
it only to re-enter his appearance after some time. The records show that most of
the lawyers who entered their appearances either filed only motions to cancel
hearings or motions for postponements, claiming to have misplaced the calendar
of court hearings or to be staying abroad. These unduly delayed the disposition
of the case in violation of the right of respondents to claim what is rightfully due
them. This fact further justifies the award of nominal damages and supports the
grant of attorney’s fees.
WHEREFORE, the petition for review on certiorari is DENIED and the decision of
the Court of Appeals is AFFIRMED. Interest at the rate of twelve percent (12%)
shall be imposed on the amount due upon finality of this decision until payment
thereof.
Maquiling vs. Phil. Tuberculosis Society
DR. ERNESTO I. MAQUILING vs. PHILIPPINE TUBERCULOSIS SOCIETY, INC.
G.R. No. 143384, February 4, 2005, Tinga, J.
FACTS:
Dr. Maquiling was employed by respondent Philippine Tuberculosis Society, Inc.
(PTS). On 8 June 1991, Dr. Maquiling, then earning a monthly salary of ₱13,900.00
was dismissed from service as Deputy Executive Director after serving PTS for 23
years. Dr. Maquiling filed a complaint against PTS for reinstatement or, in the
alternative, for payment of full backwages and separation pay in accordance with
Article 279 of the Labor Code, as well as moral damages in the amount of
₱500,000.00 and exemplary damages in the amount of ₱100,000.00.
After considering the evidence adduced by the parties, the Labor Arbiter
rendered a decision ordering PTS to immediately reinstate Dr. Maquiling to the
position of Deputy Executive Director or its equivalent in rank and pay, without
loss of seniority rights inclusive of all benefits attached to said position at the time
of his dismissal, and to pay Dr. Maquiling backwages computed from the time of
his dismissal on 7 June 1991 until his actual reinstatement but not to exceed 3
years at the rate of ₱13,900.00 per month or ₱378,775.00. He likewise ordered
PTS to pay Dr. Maquiling ₱500,000.00 as moral damages and ₱100,000.00 as
exemplary damages and to pay attorney’s fees equivalent to ten (10%) percent
of the total amount due the complainant.
Upon appeal by PTS to the NLRC, the Commission upheld the decision of the labor
arbiter and dismissed the appeal.
However, PTS appealed the decision to the Court of Appeals which reversed the
decisions of the NLRC and Labor Arbiter by ordering the dismissal of the
complaint and declaring that his dismissal from employment as legal and valid.
It, however, ordered PTS to pay Dr. Maquiling the amount of ₱10,000.00 as
damages or indemnity for violation of his right to procedural due process and
separation pay in the amount of ₱159,850.00 in the interest of social justice.
Hence, this petition for review on certiorari.
Dr. Maquiling argues that the appellate court should have applied the case of
Serrano v. NLRC1 which was decided on 27 January 2000 since the assailed
decision of the appellate court was promulgated subsequently on 28 March 2000.
He avers that PTS must pay him full backwages from the time his employment
was terminated on 7 June 1991 up to the time the decision becomes final. In
addition to backwages, he also prays that he be awarded separation pay for every
year of service, at the rate of one month pay for every year of service, as well as
thirteenth month pay, sick leave and vacation leave and all monetary benefits
including moral damages and attorney’s fees. Further, Dr. Maquiling points out
that the appellate court gravely abused its discretion by changing the rules on
pleadings before the administrative body since it considered the position paper
of PTS though unverified. PTS should have considered the twenty-three (23)
years of service of petitioner and should not have ruled that the dismissal from
service of Dr. Maquiling was for just cause. He further contends that the appellate
court did not show any degree of clarity of causal connection between Dr.
Maquiling’s acts and the supposed damage to PTS.
ISSUE: Whether or not the CA erred in not applying the Serrano case
RULING:
No. CA did not err in not applying the Serrano case.
Dr. Maquiling invokes our ruling in Serrano as basis for appropriate relief. The
Serrano ruling awarded full backwages and separation pay to the employee who
was dismissed for just cause but without the observance of the procedural due
process requirement. However, in Agabon v. NLRC, this Court modified the
Serrano ruling and awarded nominal damages in the amount of thirty
thousand pesos (₱30,000.00) including holiday pay, service incentive leave
and thirteenth month pay to the petitioners in the said case. This case
clarified the criticisms and answered the questions created by the Serrano ruling.
The Agabon doctrine enunciates the rule that if the dismissal is for just cause but
statutory due process was not observed, the dismissal should be upheld. While
the procedural infirmity cannot be cured, it should not invalidate the dismissal.
However, the employer should be held liable for non-compliance with the
procedural requirements of due process.
The violation of the petitioners’ right to statutory due process by the private
respondent warrants the payment of indemnity in the form of nominal damages.
The amount of such damages is addressed to the sound discretion of the
court, taking into account the relevant circumstances. Considering the
prevailing circumstances in the case at bar, we deem it proper to fix it at
thirty thousand pesos (₱30,000.00). We believe this form of damages would
serve to deter employers from future violations of the statutory due process
rights of employees. At the very least, it provides a vindication or recognition of
this right granted to employees under the Labor Code and its Implementing
Rules.
It may be also argued that actual or compensatory damages may be recovered in
employment termination cases. Actual or compensatory damages are not
available as a matter of right to an employee dismissed for just cause but denied
statutory due process. The award must be based on clear factual and legal bases
and correspond to such pecuniary loss suffered by the employee as duly proven.
Evidently, there is less degree of discretion to award actual or compensatory Maquiling with a just cause but without observing procedural due process,
damages. PTS is ORDERED to pay Dr. Maquiling nominal damages in the amount of
thirty thousand pesos (₱30,000.00). No costs.
In the instant case, the records fail to show that Dr. Maquiling suffered pecuniary
loss by reason of his dismissal from service. It must be noted that he was SO ORDERED.
dismissed for just cause but the procedural aspect of dismissal was not complied
with. Such non-compliance did not automatically result to any pecuniary loss.
Any such loss must be proved by Dr. Maquiling to be entitled to an award for
actual damages. Besides, the two-notice rule was not at all disregarded although CLARION PRINTING HOUSE, INC., and EULOGIO YUTINGCO vs. THE
it was observed defectively by PTS. Thus, actual damages may not be awarded. HONORABLE NATIONAL LABOR RELATIONS COMMISSION (Third Division)
and MICHELLE MICLAT
Neither will an award for moral damages nor exemplary damages prosper. The
instant controversy fails to show that the dismissal of the employee was attended G.R. No. 148372, June 27, 2005 CARPIO-MORALES, J.:
by bad faith, fraud, or was done in a manner contrary to morals, good customs or
public policy, or that the employer committed an act oppressive to labor to FACTS:
warrant an award for moral damages. Exemplary damages may avail if the
Respondent Michelle Miclat (Miclat) was employed on April 21, 1997 on a
dismissal was effected in a wanton, oppressive or malevolent manner to warrant
probationary basis as marketing assistant with a monthly salary of ₱6,500.00 by
an award for exemplary damages. Hence, Dr. Maquiling shall only be entitled to
petitioner Clarion Printing House (CLARION) owned by its co-petitioner Eulogio
an award for nominal damages.
Yutingco. At the time of her employment, she was not informed of the standards
On the other hand, Dr. Maquiling argues that PTS should have considered his that would qualify her as a regular employee.
twenty-three (23) years of service in the institution before he was dismissed
The EYCO Group of Companies of which CLARION formed part filed with the
from service. Such ratiocination is not quite convincing. The jurisprudential law
Securities and Exchange Commission (SEC) a "Petition for the Declaration of
is not bereft of cases which disregarded length of service of an employee for
Suspension of Payment, Formation and Appointment of Rehabilitation Receiver/
breach of trust and confidence. Although length of service may be considered in
Committee, Approval of Rehabilitation Plan with Alternative Prayer for
reaching a decision in employment termination cases, the same alone is not
Liquidation and Dissolution of Corporation"
controlling for other considerations must be taken into account such as the
nature of the position he was holding, performance of an employee, quality of
The Assistant Personnel Manager of CLARION informed Miclat by telephone that
work, character and work attitude. Worth stressing is the fact that Dr. Maquiling
her employment contract had been terminated. No reason was given for the
is holding a managerial position being a Deputy Executive Director. Hence, trust
termination.
and confidence is an essential factor in determining his eligibility to continue
holding his position. The crucial nature of his position in PTS is exacting as to In her Position Paper filed before the labor arbiter, Miclat claimed that assuming
such qualification which cannot be outweighed by any length of service he that her termination was necessary, the manner in which it was carried out was
earned. illegal, no written notice thereof having been served on her, and she merely
learned of it only a day before it became effective.
Dispositive Portion:
On the other hand, petitioners claimed that they could not be faulted for
WHEREFORE, in view of the foregoing, the Decision of the Court of Appeals dated
retrenching some of its employees including Miclat, they drawing attention to the
28 March 2000 is hereby MODIFIED pursuant to the Agabon ruling as the latest
EYCO Group of Companies’ being placed under receivership, notice of which was
jurisprudential rule on the matter. For the dismissal from employment of Dr.
sent to its supervisors and rank and file employees via a Memorandum.
The Labor arbiter found that Miclat was illegally dismissed and directed her
reinstatement. The NLRC affirmed the labor arbiter’s decision. The CA sustained
the resolutions of the NLRC; it also denied petitioner’s MR of the decision.
ISSUE:
Whether or not Miclat was illegally dismissed
RULING:
The petition is partly meritorious.
From the above-quoted provisions of P.D. No. 902-A, as amended, the
appointment of a receiver or management committee by the SEC presupposes a
finding that, inter alia, a company possesses sufficient property to cover all its
debts but "foresees the impossibility of meeting them when they respectively fall
due" and "there is imminent danger of dissipation, loss, wastage or destruction
of assets of other properties or paralization of business operations."
That the SEC, mandated by law to have regulatory functions over corporations,
partnerships or associations, 27appointed an interim receiver for the EYCO
Group of Companies on its petition in light of, as quoted above, the therein
enumerated "factors beyond the control and anticipation of the management"
rendering it unable to meet its obligation as they fall due, and thus resulting to
"complications and problems . . . to arise that would impair and affect [its]
operations . . ." shows that CLARION, together with the other member-companies
of the EYCO Group of Companies, was suffering business reverses justifying,
among other things, the retrenchment of its employees.
CLARION’s claim that at the time it terminated Miclat it was experiencing
business reverses gains more light from the SEC’s disapproval of the EYCO Group
of Companies’ petition to be declared in state of suspension of payment, filed
before Miclat’s termination, and of the SEC’s consequent order for the group of
companies’ dissolution and liquidation.
This Court’s finding that Miclat’s termination was justified notwithstanding, since
at the time she was hired on probationary basis she was not informed of the
standards that would qualify her as a regular employee, under Section 6, Rule I
of the Implementing Rules of Book VI of the Labor Code which reads:
SEC. 6. Probationary employment. There is probationary employment where the
employee, upon his engagement, is made to undergo a trial period during which
the employer determines his fitness to qualify for regular employment, based on
reasonable standards made known to him at the time of engagement.
"Probationary employment shall be governed by the following rules:
xxx
(d) In all cases of probationary employment, the employer shall make known to
the employee the standards under which he will qualify as a regular employee at
the time of his engagement. Where no standards are made known to the
employee at that time, he shall be deemed a regular employee" she was deemed
to have been hired from day one as a regular employee. CLARION, however, failed
to comply with the notice requirement provided for in Article 283 of the Labor
Code, to wit:
ART. 283. CLOSURE OF ESTABLISHMENT AND REDUCTION OF PERSONNEL. –
The employer may also terminate the employment of any employee due to the
installation of labor saving devices, redundancy,retrenchment to prevent losses
or the closing or cessation of operation of the establishment or undertaking
unless the closing is for the purpose of circumventing the provisions of this Title,
by serving a written notice on the worker and the Ministry of Labor and
Employment at least one (1) month before the intended date thereof. x x x
(Emphasis and underscoring supplied)
This Court thus deems it proper to award the amount equivalent to Miclat’s one
(1) month salary of ₱6,500.00 as nominal damages to deter employers from
future violations of the statutory due process rights of employees.
WHEREFORE, the Court of Appeals November 24, 2000 Decision, together with
its May 23, 2001 Resolution, is SET ASIDE and another rendered declaring the
legality of the dismissal of respondent, Michelle Miclat. Petitioners are ORDERED,
however, to PAY her the following in accordance with the foregoing discussions:
1) ₱6,500.00 as nominal damages for non-compliance with statutory due
process;
2) ₱6,500.00 as separation pay; and
3) ₱3,250.00 as 13th month pay.
Let a copy of this Decision be furnished the SEC Hearing Panel charged with the
liquidation and dissolution of petitioner corporation for inclusion, in the list of
claims of its creditors, respondent Michelle Miclat’s claims, to be satisfied in
accordance with Article 110 of the Labor Code in relation to the Civil Code
provisions on Concurrence and Preference of Credits.
-Mika Ituriaga
G.R. No. 185565. April 26, 2017.
LOADSTAR SHIPPING COMPANY, INCORPORATED and LOADSTAR
INTERNATIONAL SHIPPING COMPANY, INCORPORATED, petitioners, vs.
MALAYAN INSURANCE COMPANY, INCORPORATED, respondent.
FACTS:
This resolves the Motion for Reconsideration of the Decision of the Court in the
case filed by respondent Malayan Insurance Company, Incorporated (Malayan).
Malayan alleges that in ruling in favor of Loadstar Shipping Company,
Incorporated and Loadstar International Shipping Company, Incorporated
(petitioners), the Court disregarded the conclusion of the Court of Appeals that
the petitioners acted as a common carrier; that there was a breach of the contract
of affreightment; and that the petitioners failed to produce evidence of a calamity
to be exculpated from liability.
In their Comment, the petitioners contend that the grounds raised by Malayan
are no longer relevant because as found by the Court, Malayan did not adduce
proof of pecuniary loss to the insured Philippine Associated Smelting and
Refining Corporation (PASAR). PASAR has not established by an iota of evidence
the amount of loss or actual damage it suffered by reason of seawater wattage of
the 777.29 metric tons of copper concentrates. In spite of no proof of loss,
Malayan, with seeming hastiness paid the claim of PASAR in the amount of
P33,934,948.75.6 According to the petitioners, Malayan cannot make them
answerable for its mistake in indemnifying PASAR.
Malayan alleged that the Third Division deviated from the doctrine enunciated in
Delsan Transport Lines, Inc. v. CA. Malayan contends that in Delsan, the Court
held that upon payment by the insurance company of the insurance claim, the
insurance company should be subrogated to the rights of the insured; it is not
even necessary to present the insurance policy because subrogation is a matter
of equity.
ISSUE: Whether or not Malayan is entitled to reimbursement from Loadstar.
RULING:
Delsan involved the sinking of a vessel which took down with it the entire cargo
of fuel it was carrying. Hence, the fact of total loss was completely and
undisputedly established.
In comparison with Delsan, the facts of the instant case are not as
straightforward. Here, the copper concentrates were delivered by the petitioners
to the consignee PASAR although part thereof was contaminated with seawater.
To be clear, PASAR did not simply reject the contaminated goods (on the basis
that these were no longer fit for the intended purpose), claim the value thereof
from Malayan and leave things at that — it bought back the goods which it had
already rejected. Meanwhile, Malayan opted to cash in the situation by selling the
contaminated copper concentrates to the very same consignee who already
rejected the goods as total loss. After denying the petitioners of opportunity to
participate in the disposal or sale of the goods, Malayan sought to recover the
total value of the wet copper concentrates from them. Malayan and PASAR’s
extraneous actuations are inconsistent with the alleged fact of total loss. Verily,
Delsan cannot be applied given contradistinctive circumstances obtaining in this
case.
The Court declares that it is iniquitous to consider the value of the contaminated
copper concentrates as the amount of damages sustained by PASAR when there
is no evidence to that effect. Notably, PASAR and Malayan were even able to come
up and agree on a residual value. Needless to say, the mere fact that there was a
residual value negates the verity of total loss sustained by PASAR. It is also
inequitable to consider the purchase price of US$90,000.00 as the actual residual
value of the copper concentrates since there is no showing that PASAR and
Malayan objectively arrived at this amount.
At the pain of being repetitive, the Court reiterates the principle that actual
damages are not presumed; it cannot be anchored on mere surmises,
speculations or conjectures. As the Court discussed in the Decision dated
November 26, 2014, Malayan was not able to prove the pecuniary loss suffered
by PASAR for which the latter was indemnified. This is in line with the principle
that a subrogee steps into the shoes of the insured and can recover only if the
insured likewise could have recovered. Nonetheless, the Court notes that the
petitioners failed to comply with some of the terms of their contract of
affreightment with PASAR. It was stipulated that the vessel to be used must not
exceed 25 years of age, yet the vessel, MV Bobcat, was more than that age when
the subject copper concentrates were transported. Additionally, the petitioners
failed to keep the cargo holds and hatches of MV Bobcat clean and fully secured
as agreed upon, which resulted in the wattage of the cargo.
As common carriers, the petitioners are bound to observe extraordinary
diligence in their vigilance over the goods they transport, as required by the
nature of their business and for reasons of public policy.
When the copper concentrates delivered were contaminated with seawater, the
petitioners have failed to exercise extraordinary diligence in the carriage thereof.
In view of the foregoing, the Court deems it proper to award nominal damages to
Malayan. This is in recognition of the breach of contract committed by the
petitioners. “So long as there is a violation of the right of the plaintiff —
whether based on law, contract or other sources of obligations — an award
of nominal damages is proper.” Articles 2221 and 2222 of the Civil Code
provide:
Article 2221. Nominal damages are adjudicated in order that a right of
the plaintiff, which has been violated or invaded by the defendant, may
be vindicated or recognized, and not for the purpose of indemnifying the
plaintiff for any loss suffered by him.
Article 2222. The court may award nominal damages inbevery obligation
arising from any source enumerated in Article 1157, or in every case
where any property right has been invaded.
“Nominal damages are recoverable where a legal right is technically
violated and must be vindicated against an invasion that has produced no
actual present loss of any kind or where there has been a breach of contract
and no substantial injury or actual damages whatsoever have been or can
be shown.” “The amount of such damages is addressed to the sound
discretion of the court, taking into account the relevant circumstances.” To
the mind of the Court, the amount of P1,769,374.725, which is equivalent to six
percent (6%) of the sum being claimed by Malayan less the residual value of the
copper concentrates, is sufficient as damages.
WHEREFORE, the motion for reconsideration is PARTLY GRANTED. The Decision
dated November 26, 2014 of the Court is hereby MODIFIED in that nominal
damages in the amount of P1,769,374.725 is awarded to Malayan Insurance
Company, Incorporated, with legal interest at the rate of six percent (6%) per
annum from the finality of this Resolution until fully paid. SO ORDERED.
D. When not awarded
MINDANAO ACADEMY, INC., MAURICIO O. BAS, ERLINDA D. DIAZ,
accompanied by her husband ANTOLIN DIAZ, ESTER AIDA D. BAS,
accompanied by her husband MAURICIO O. BAS, ROSALINDA D. BELLEZA,
accompanied by her husband APOLINARIO BELLEZA, LUZ MINDA D.
DAJAO, accompanied by her husband ELIGIO C. DAJAO, ADELAIDA D.
NUESA, accompanied by her husband WILSON NUESA, PEDRO N. ABUTON,
SY PAOCO, JOSEFA DIGNUM, and PERFECTO VELASQUEZ, plaintiffs-
appellees, vs. ILDEFONSO D. YAP, ROSENDA A. DE NUQUI, and SOTERO A.
DIONISIO, JR., defendants,
ILDEFONSO D. YAP, defendant-appellant.
G.R. No. L-17681 - February 26, 1965
-----------------------------
ROSENDA A. DE NUQUI, SOTERO DIONISIO, JR., ERLINDA DIONISIO-DIAZ
and ANTOLIN DIAZ, plaintiffs appellees, vs. ILDEFONSO D. YAP, defendant-
appellant.
G.R. No. L-17682 - February 26, 1965
FACTS: By deed entitled "Mutual Agreement," Rosenda A. de Nuqui (widow of
deceased Sotero Dionisio) and her son Sotero Dionisio, Jr. sold three parcels of
residential land in Oroquieta, Misamis Occidental, and another parcel in Ozamis
City in favor of Ildefonso D. Yap. Included in the sale were certain buildings
situated on said lands as well as laboratory equipment, books, furniture and
fixtures used by two schools established in the respective properties, the
Mindanao Academy in Oroquieta and the Misamis Academy in Ozamis City.
Besides Rosenda and her son Sotero, Jr., both of whom signed the instrument,
Adelaida Dionisio-Nuesa (a daughter of Rosenda) is also named therein as co-
vendor, but actually did not take part either personally or through her uncle and
supposed attorney-in-fact, Restituto Abuton. Rosenda and her 2 children above
named are referred to in the deed as the owners pro-indiviso of the properties
sold. The truth, however, was that there were other co-owners of the lands,
namely, Erlinda, Ester, Rosalinda, and Luz, children also of Rosenda, and that as
far as the school building, equipment, books, furniture and fixtures were
concerned, they were owned by the Mindanao Academy, Inc., a corporation
operating both the Mindanao Academy in Oroquieta and the Misamis Academy in
Ozamis City.
The buyer, Ildefonso D. Yap, obtained possession of the properties by virtue of
the sale, took over the operation of the two schools and even changed their names
to Harvardian Colleges. In view thereof two actions were commenced in the CFI
of Misamis Occidental. The first was for annulment of the sale and recovery
of rents and damages with the Mindanao Academy, Inc., the 5 children of
Rosenda Nuqui who did not take part in the deed of sale, and several other
persons who were stockholders of the said corporation, as plaintiffs, and
the parties who signed the deed of sale as defendants. The second action was
for rescission with Rosenda Nuqui, Sotero Dionisio, Jr. and Erlinda D. Diaz as
plaintiffs, and Ildefonso D. Yap as lone defendant. The other four children of
Rosenda did not join, having previously ceded and quitclaimed their shares in the
litigated properties in favor of their sister Erlinda.
The two actions were tried jointly and the court a quo rendered judgment as
declaring the mutual agreement null and void ab initio. Ildefonso D. Yap was
ordered (1) to restore to the plaintiffs all the buildings and grounds described in
the Mutual Agreement together with all the permanent improvements thereon;
(2) to restore to the Mindanao Academy, Inc., all the books laboratory apparatus,
furniture and other equipment described in the Mutual Agreement and specified
in the inventory; and (3) to pay to the plaintiffs stockholders of the Mindanao
Academy, Inc., the amount of P10,000.00 as nominal damages, P3,000.00 as
exemplary damages; and P2,000.00 as attorney's fees. These damages shall
be apportioned to each of the stockholders named as plaintiffs in said case
in proportion to their respective interests in the corporation. The trial court
awarded no compensatory damages because the Mindanao Academy, Inc. had
been operating the two schools at a loss before the sale in question, and Yap
himself was no more successful after he took over
ISSUE:
1. W/N the stockholders of the Mindanao Academy, Inc., who joined as
plaintiffs in the annulment of the sale and recovery of rents are
entitled to nominal and exemplary damages
RULING: NO
According to their second amended complaint they were joined merely pro
forma, and "for the sole purpose of the moral damage which has been all the time
alleged in the original complaint." Indeed the interests of the said stockholders, if
any, were already represented by the corporation itself, which was the proper
party plaintiff; and no cause of action accruing to them separately from the
corporation is alleged in the complaint, other than that for moral damages due to
"extreme mental anguish, serious anxiety and wounded feelings." The trial court,
however, ruled out this claim for moral damages and no appeal from such ruling
has been taken. The award for nominal and exemplary damages should be
eliminated in toto.
The award for attorney's fees in the amount of P2,000.00 should be upheld,
although the same should be for the account, not of the plaintiff stockholders of
the Mindanao Academy, Inc., but of the corporation itself, and payable to their
common counsel as prayed for in the complaint.
DISPOSITIVE PORTION:
WHEREFORE, the judgment appealed from is modified by eliminating therefrom
the award of attorney's fees of P1,000.00 in favor of Erlinda D. Diaz and her
husband, plaintiffs in Civil Case No. 1907, and the award of nominal and
exemplary damages in Civil Case No. 1774; and making the award of attorney's
fees in the sum of P2,000.00 payable to counsel for the account of the Mindanao
Academy, Inc. instead of the plaintiff stockholders. In all other respects the
judgment appealed from is affirmed. No pronouncement as to costs.
CHAPTER V: TEMPERATE OR MODERATE DAMAGES
A. CONCEPT AND RATIONALE
PREMIERE DEVELOPMENT BANK, petitioner, vs. COURT OF APPEALS,
PANACOR MARKETING CORPORATION and ARIZONA TRANSPORT
CORPORATION, respondents.
G.R. No. 159352, FIRST DIVISION, April 14 ,2004, YNARES-SANTIAGO, J.
FACTS:
The undisputed facts show that on or about October 1994, Panacor Marketing
Corporation (Panacor for brevity), a newly formed corporation, acquired an
exclusive distributorship of products manufactured by Colgate Palmolive
Philippines, Inc. (Colgate for short). To meet the capital requirements of the
exclusive distributorship, which required an initial inventory level of P7.5
million, Panacor applied for a loan of P4.1 million with Premiere Development
Bank. After an extensive study of Panacor’s creditworthiness, Premiere Bank
rejected the loan application and suggested that its affiliate company, Arizona
Transport Corporation (Arizona for short), should instead apply for the loan on
condition that the proceeds thereof shall be made available to Panacor.
Eventually, Panacor was granted a P4.1 million credit line as evidenced by a
Credit Line Agreement. As suggested, Arizona, which was an existing loan client,
applied for and was granted a loan of P6.1 million, P3.4 million of which would
be used to pay-off its existing loan accounts and the remaining P2.7 million as
credit line of Panacor. As security for the P6.1 million loan, Arizona, represented
by its Chief Executive Officer Pedro Panaligan and spouses Pedro and Marietta
Panaligan in their personal capacities, executed a Real Estate Mortgage against a
parcel of land covered by TCT No. T-3475 as per Entry No. 49507 dated October
2, 1995.
Since the P2.7 million released by Premiere Bank fell short of the P4.1 million
credit line which was previously approved, Panacor negotiated for a take-out
loan with Iba Finance Corporation (hereinafter referred to as Iba-Finance) in the
sum of P10 million, P7.5 million of which will be released outright in order to
take-out the loan from Premiere Bank and the balance of P2.5 million (to
complete the needed capital of P4.1 million with Colgate) to be released after the
cancellation by Premiere of the collateral mortgage on the property covered by
TCT No. T-3475. Pursuant to the said take-out agreement, Iba-Finance was
authorized to pay Premiere Bank the prior existing loan obligations of Arizona in
an amount not to exceed P6 million.
On October 5, 1995, Iba-Finance sent a letter to Ms. Arlene R. Martillano, officer-
in-charge of Premiere Bank’s San Juan Branch, informing her of the approved
loan in favor of Panacor and Arizona, and requesting for the release of TCT No. T-
3475. Martillano, after reading the letter, affixed her signature of conformity
thereto and sent the original copy to Premiere Bank’s legal office.
On October 12, 1995, Premiere Bank sent a letter-reply to Iba-Finance, informing
the latter of its refusal to turn over the requested documents on the ground that
Arizona had existing unpaid loan obligations and that it was the bank’s policy to
require full payment of all outstanding loan obligations prior to the release of
mortgage documents. Thereafter, Premiere Bank issued to Iba-Finance a Final
Statement of Account showing Arizona’s total loan indebtedness. On October 19,
1995, Panacor and Arizona executed in favor of Iba-Finance a promissory note in
the amount of 7.5 million. Thereafter, Iba-Finance paid to Premiere Bank the
amount of P6,235,754.79 representing the full outstanding loan account of
Arizona. Despite such payment, Premiere Bank still refused to release the
requested mortgage documents specifically, the owner’s duplicate copy of TCT
No. T-3475.
On November 2, 1995, Panacor requested Iba-Finance for the immediate
approval and release of the remaining P2.5 million loan to meet the required
monthly purchases from Colgate. Iba-Finance explained however, that the
processing of the P2.5 million loan application was conditioned, among others,
on the submission of the owner’s duplicate copy of TCT No. 3475 and the
cancellation by Premiere Bank of Arizona’s mortgage. Occasioned by Premiere
Bank’s adamant refusal to release the mortgage cancellation document, Panacor
failed to generate the required capital to meet its distribution and sales targets.
On December 7, 1995, Colgate informed Panacor of its decision to terminate their
distribution agreement.
On March 13, 1996, Panacor and Arizona filed a complaint for specific
performance and damages against Premiere Bank before the Regional Trial Court
of Pasig City, docketed as Civil Case No. 65577.
On June 11, 1996, Iba-Finance filed a complaint-in-intervention praying that
judgment be rendered ordering Premiere Bank to pay damages in its favor.
On May 26, 1998, the trial court rendered a decision in favor of Panacor and Iba-
Finance.
Premiere Bank appealed to the Court of Appeals contending that the trial court
erred in finding, inter alia, that it had maliciously downgraded the credit-line of
Panacor from P4.1 million to P2.7 million.
In the meantime, a compromise agreement was entered into between Iba-
Finance and Premiere Bank whereby the latter agreed to return without interest
the amount of P6,235,754.79 which Iba-Finance earlier remitted to Premiere
Bank to pay off the unpaid loans of Arizona. On March 11, 1999, the compromise
agreement was approved.
On June 18, 2003, a decision was rendered by the Court of Appeals which affirmed
with modification the decision of the trial court. The CA affirmed with
modification in that the award of exemplary damages in favor of the appellees is
hereby reduced to P500,000.00.
ISSUE:
Whether or not there is basis or competent piece of evidence presented during
the trial to support an award of actual damages of P4,520,000.00.(NONE)
RULING:
Premiere Bank argues that the finding by the appellate court that it was liable for
actual damages in the amount of P4,520,000.00 is without basis. It contends that
the evidence presented by Panacor in support of its claim for actual damages are
not official receipts but self-serving declarations.
To justify an award for actual damages, there must be competent proof of the
actual amount of loss. Credence can be given only to claims, which are duly
supported by receipts. The burden of proof is on the party who will be defeated
if no evidence is presented on either side. He must establish his case by a
preponderance of evidence which means that the evidence, as a whole, adduced
by one side is superior to that of the other. In other words, damages cannot be
presumed and courts, in making an award, must point out specific facts that can
afford a basis for measuring whatever compensatory or actual damages are
borne.
Under Article 2199 of the Civil Code, actual or compensatory damages are those
awarded in satisfaction of, or in recompense for, loss or injury sustained. They
proceed from a sense of natural justice and are designed to repair the wrong that
has been done, to compensate for the injury inflicted and not to impose a penalty.
In the instant case, the actual damages were proven through the sole testimony
of Themistocles Ruguero, the vice president for administration of Panacor. In his
testimony, the witness affirmed that Panacor incurred losses, specifically, in
terms of training and seminars, leasehold acquisition, procurement of vehicles
and office equipment without, however, adducing receipts to substantiate the
same. The documentary evidence marked as exhibit "W", which was an ordinary
private writing allegedly itemizing the capital expenditures and losses from the
failed operation of Panacor, was not testified to by any witness to ascertain the
veracity of its contents. Although the lower court fixed the sum of P4,520,000.00
as the total expenditures incurred by Panacor, it failed to show how and in what
manner the same were substantiated by the claimant with reasonable certainty.
Hence, the claim for actual damages should be admitted with extreme caution
since it is only based on bare assertion without support from independent
evidence. Premiere’s failure to prove actual expenditure consequently conduces
to a failure of its claim. In determining actual damages, the court cannot rely on
mere assertions, speculations, conjectures or guesswork but must depend on
competent proof and on the best evidence obtainable regarding the actual
amount of loss.
Even if not recoverable as compensatory damages, Panacor may still be awarded
damages in the concept of temperate or moderate damages. When the court finds
that some pecuniary loss has been suffered but the amount cannot, from the
nature of the case, be proved with certainty, temperate damages may be
recovered. Temperate damages may be allowed in cases where from the nature
of the case, definite proof of pecuniary loss cannot be adduced, although the court
is convinced that the aggrieved party suffered some pecuniary loss.
It is obvious that the wrongful acts of Premiere Bank adversely affected, in one
way or another, the commercial credit. of Panacor, greatly contributed to, if not,
decisively caused the premature stoppage of its business operations and the
consequent loss of business opportunity. Since these losses are not susceptible to
pecuniary estimation, temperate damages may be awarded. Article 2216 of the
Civil Code:
No proof of pecuniary loss is necessary in order that moral, nominal,
temperate, liquidated or exemplary damages may be adjudicated. The
assessment of such damages, except liquidated ones, is left to the
discretion of the Court, according to the circumstances of each case.
Under the circumstances, the sum of P200,000.00 as temperate damages is
reasonable.
WHEREFORE, the petition is DENIED. The Decision dated June 18, 2003 of the
Court of Appeals in CA-G.R. CV No. 60750, ordering Premiere Bank to pay Panacor
Marketing Corporation P500,000.00 as exemplary damages, P100,000.00 as
attorney’s fees, and costs, is AFFIRMED, with the MODIFICATION that the award
of P4,520,000.00 as actual damages is DELETED for lack of factual basis. In lieu
thereof, Premiere Bank is ordered to pay Panacor P200,000.00 as temperate
damages. SO ORDERED.
GOVERNMENT SERVICE INSURANCE SYSTEM, PETITIONER, VS. SPOUSES
GONZALO AND MATILDE LABUNG-DEANG, RESPONDENTS.
G.R. No. 135644, September 17, 2001, PARDO, J.
Facts:
Sometime in December 1969, the spouses Deang obtained a housing loan from
the GSIS in the amount of eight thousand five hundred pesos (P8,500.00). Under
the agreement, the loan was to mature on December 23, 1979. The loan was
secured by a real estate mortgage constituted over the spouses' property covered
by Transfer Certificate of Title No. 14926-R issued by the Register of Deeds of
Pampanga. As required by the mortgage deed, the spouses Daeng deposited the
owner's duplicate copy of the title with the GSIS.
On January 19, 1979, eleven (11) months before the maturity of the loan, the
spouses Deang settled their debt with the GSIS and requested for the release of
the owner's duplicate copy of the title since they intended to secure a loan from
a private lender and use the land covered by it as collateral security for the loan
of fifty thousand pesos (P50,000.00) which they applied for with one Milagros
Runes. They would use the proceeds of the loan applied for the renovation of the
spouses' residential house and for business.
However, personnel of the GSIS were not able to release the owner's duplicate of
the title as it could not be found despite diligent search. As stated earlier, the
spouses as mortgagors deposited the owner's duplicate copy of the title with the
GSIS located at its office in San Fernando, Pampanga.
Satisfied that the owner's duplicate copy of the title was really lost, in 1979, GSIS
commenced the reconstitution proceedings with the Court of First Instance of
Pampanga for the issuance of a new owner's copy of the same.
On June 22, 1979, GSIS issued a certificate of release of mortgage.
On June 26, 1979, after the completion of judicial proceedings, GSIS finally
secured and released the reconstituted copy of the owner's duplicate of Transfer
Certificate of Title No. 14926-R to the spouses Deang.
On July 6, 1979, the spouses Deang filed with the Court of First Instance, Angeles
City a complaint against GSIS for damages, claiming that as result of the delay in
releasing the duplicate copy of the owner's title, they were unable to secure a loan
from Milagros Runes, the proceeds of which could have been used in defraying
the estimated cost of the renovation of their residential house and which could
have been invested in some profitable business undertaking.
In its defense, GSIS explained that the owners' duplicate copy of the title was
released within a reasonable time since it had to conduct standard pre-audit and
post-audit procedures to verify if the spouses Deang's account had been fully
settled.
On July 31, 1995, the trial court rendered a decision ruling for the spouses Deang.
The trial court reasoned that the loss of the owner's duplicate copy of the title "in
the possession of GSIS as security for the mortgage... without justifiable cause
constitutes negligence on the part of the employee of GSIS who lost it," making
GSIS liable for damages.
On September 21, 1998, the Court of Appeals promulgated a decision affirming
the appealed judgment, ruling: First, since government owned and controlled
corporations (hereafter, "GOCCs") whose charters provide that they can sue and
be sued have a legal personality separate and distinct from the government, GSIS
is not covered by Article 2180 of the Civil Code, and it is liable for damages caused
by their employees acting within the scope of their assigned tasks. Second, the
GSIS is liable to pay a reasonable amount of damages and attorney's fees, which
the appellate court will not disturb.
Issue:
Whether the GSIS, as a GOCC primarily performing governmental functions, is
liable for a negligent act of its employee acting within the scope of his assigned
tasks. (Yes)
Ruling:
Under the facts, there was a pre-existing contract between the parties. GSIS and
the spouses Deang had a loan agreement secured by a real estate mortgage. The
duty to return the owner's duplicate copy of title arose as soon as the mortgage
was released. GSIS insists that it was under no obligation to return the owner's
duplicate copy of the title immediately. This insistence is not warranted.
Negligence is obvious as the owners' duplicate copy could not be returned to the
owners. Thus, the more applicable provisions of the Civil Code are:
 "Article 1170. Those who in the performance of their obligations are
guilty of fraud, negligence, or delay and those who in any manner
contravene the tenor thereof are liable for damages."
"Article 2201. In contracts and quasi-contracts, the damages for which
the obligor who acted in good faith is liable shall be those that are the
natural and probable consequences of the breach of the obligation, and
which the parties have foreseen or could have reasonably foreseen at the
time the obligation was constituted xxx."
Since good faith is presumed and bad faith is a matter of fact which should be
proved, we shall treat GSIS as a party who defaulted in its obligation to return the
owners' duplicate copy of the title. As an obligor in good faith, GSIS is liable for
all the "natural and probable consequences of the breach of the obligation." The
inability of the spouses Deang to secure another loan and the damages they
suffered thereby has its roots in the failure of the GSIS to return the owners'
duplicate copy of the title.
We come now to the amount of damages. In a breach of contract, moral damages
are not awarded if the defendant is not shown to have acted fraudulently or with
malice or bad faith. The fact that the complainant suffered economic hardship or
worries and mental anxiety is not enough.
There is likewise no factual basis for an award of actual damages. Actual damages
to be compensable must be proven by clear evidence. A court can not rely on
"speculation, conjecture or guess work" as to the fact and amount of damages, but
must depend on actual proof.
However, it is also apparent that the spouses Deang suffered financial damage
because of the loss of the owners' duplicate copy of the title. Temperate damages
may be granted.
"Article 2224. Temperate or moderate damages, which are more than
nominal but less than compensatory damages, may be recovered when
the court finds that some pecuniary loss has been suffered but its amount
cannot, from the nature of the case, be proved with certainty."
GSIS submits that there must be proof of pecuniary loss. This is untenable. The
rationale behind temperate damages is precisely that from the nature of the case,
definite proof of pecuniary loss cannot be offered. When the court is convinced
that there has been such loss, the judge is empowered to calculate moderate
damages, rather than let the complainant suffer without redress from the
defendant's wrongful act.
The award of twenty thousand pesos (P20,000.00) in temperate damages is
reasonable considering that GSIS spent for the reconstitution of the owners'
duplicate copy of the title.
Next, the attorney's fees. Attorney's fees which are granted as an item of damages
are generally not recoverable. The award of attorney's fees is the exception
rather than the rule and counsel's fees are not to be awarded every time a party
wins a suit. The award of attorney's fees demands factual, legal and equitable
justification; its basis cannot be left to speculation or conjecture.
We find no circumstance to justify the award of attorney's fees. We delete the
same.
WHEREFORE, we DENY the petition. We AFFIRM the decision of the Court of
Appeals in CA-G.R. CV No. 51240 with the MODIFICATION that award of
attorney's fees is DELETED.
No costs.
SO ORDERED.
THE MANILA BANKING CORPORATION, petitioner,
vs.
INTERMEDIATE APPELLATE COURT AND WILFREDO J. RIVERA,
respondents.
G.R. No. L-66123 August 22, 1984 RELOVA, J.:
FACTS: In the morning of July 10, 1975 herein private respondent Wilfredo J.
Rivera deposited with petitioner bank the sum of P80,189.19. In the afternoon of
the same day, private respondent Rivera issued a Manila Banking Corporation
Check No. 16756626 in the amount of P80,000.00 under Current Account No. 6-
05350-5 payable to Collins Philippines with whom he had a business transaction.
Thereafter, private respondent's wife received a letter of demand from Collins
Philippines, saying that — “we are redepositing the same check with the fair
warning that if the said check will again be dishonored, we shall close our
business dealings and institute proper action for the protection of our interest.”
His wife immediately informed him. Upon receipt of the message, Mr. Rivera
complained to the Public Relations Officer of petitioner bank, inviting attention
to the letter received by him from Collins Philippines complaining against the
dishonor of his check. The Public Relations Officer of the bank, upon
investigation, found that the money deposited was credited into another account
and that was the reason why the check issued by him could not be encashed upon
presentation.
As a consequence, private respondent claimed that he suffered humiliation and
embarrassment due to the bank's gross negligence. Complaint was filed in court
which awarded private respondent damages, as follows: 1) P75,000.00 as actual
damages; 2) P25,000.00 as moral damages; 3) P10,000.00 as exemplary
damages; 4) P25,000.00 as and for attorney's fees; and 5) Cost of suit.
On appeal to the Intermediate Appellate Court, the judgment of the trial court
was modified in the sense that — the award of actual damage in the sum of
P75,000.00 be eliminated and instead the sum of Ten Thousand (P10,000.00)
Pesos be awarded as temperate damage and the reduction of the award of
attorney's fees to the sum of Fifteen Thousand (P15,000.00) Pesos, the decision
is affirmed in toto in all other respects.
ISSUE: WHETHER OR NOT PRIVATE RESPONDENT IS ENTITLED TO AN
AWARD OF TEMPERATE OR MODERATE DAMAGES.
RULING: Yes. We agree with the petitioner that private respondent is not entitled
to moral damages considering that in a matter of four hours the mistake was
rectified and the payee, Collins Philippines, was paid the full amount of the check.
In the case of Singson vs. Bank of Philippine Island, this Court held that since "the
wrong done to the plaintiffs was remedied as soon as the President of the bank
realized the mistake he and his subordinate employee had committed, the Court
finds that an award of nominal damages — the amount of which need not be
proven — in the sum of P1,000.00, in addition to attorney's fees in the sum of
P500.00, would suffice to vindicate plaintiff's rights."
In the case at bar, temperate or moderate damages are proper not for
indemnification of loss suffered but for the vindication or recognition of a right
violated or invaded. Considering the facts of the case under appeal, the sum of
P5,000.00 as temperate or moderate damages would suffice, plus attorney's fees
of P5,000.00.
PEOPLE OF THE PHILIPPINES, appellee, vs. FRANCISCO DACILLO
alias DODOY AND JOSELITO PACOT y IBARRA (case provisionally
dismissed), accused, FRANCISCO DACILLO alias DODOY, appellant.
G.R. No. 149368, EN BANC, April 14, 2004, CORONA, J.:
FACTS:
The victim, seventeen-year-old Rosemarie B. Tallada, was last seen alive
at dusk on February 6, 2000, on the bridge near appellant’s house at Purok
No. 3, New Society Village, Ilang, Davao City. Around 7:45 p.m. that
evening, witness Jovelyn Dagmil, who was living with her aunt in the
house adjacent to appellant’s, was looking for her cousin when she saw
the victim Rosemarie on the bridge. Because it was drizzling, she invited
Rosemarie inside their house but the latter declined and told her she was
waiting for someone. After a while, Jovelyn heard a man inside appellant’s
house calling "Psst, psst . . ." Thinking the call was meant for her, she
turned but instead saw Rosemarie walking towards and entering
appellant’s house.
Not long after Rosemarie went inside the house, a struggle was heard
therein. Witnesses Roche and Resna Abregon, who were in the adjacent
house singing with a karaoke machine, suddenly felt the floor shaking as
if a scuffle was going on at the other side of the wall. The houses were built
on stilts above the seashore, adjoining one another with mere wooden
partitions in between. Roche Abregon peeped through a hole on the wall
and saw appellant and another man grappling with a woman who was
gagged with a handkerchief. When Roche saw appellant choking the
woman, she informed her aunt about the commotion in appellant’s house
but the aunt brushed it aside as a simple family quarrel. For a while they
heard the sound of a woman being beaten up. Then everything became The trial court rendered judgment finding appellant guilty of murder and
quiet. Later that evening, they saw appellant leaving his house. The imposed upon him the supreme penalty of death. Thus, this automatic
following day, February 7, 2000, at around 8:00 a.m., appellant was seen review by the Supreme Court.
entering his house carrying lumber and screen. He was observed going in
and out of his house several times, each time carefully locking the gate as
he left. At around 9:00 a.m., appellant was seen with ready-mixed cement
ISSUE:
in a plastic pail. Later, appellant entrusted a bag of woman’s personal
belongings to barangay tanod Allan Castañares and told the latter that it
belonged to his woman companion. He allegedly could not bring it home
because his wife might see them. Whether or not appellant’s conviction shall be upheld. (YES)

By February 11, 2000, neighbors started smelling the rotten odor of

Rosemarie’s already decomposing body. At 5:00 p.m. the same day,
witnesses Roche, Resna, and Rachel were gathering seashells under RULING:
appellant’s house when they saw droplets of blood and pus dripping from
appellant’s comfort room. They immediately reported it to their aunt who
in turn instructed her husband to get a stick and poke the sacks covering
Appellant admitted that he had a hand in the killing of Rosemarie but
the comfort room. However, the husband instead climbed up the house
attempted to downgrade his participation in the crime by claiming he only
and was greeted by the stink emanating from the corner where he saw a
held Rosemarie’s legs as Pacot was strangulating her. Despite appellant’s
tomb-like structure. They immediately reported the matter to barangay
self-serving, exculpatory statement limiting his involvement in the crime,
officials who called the police. At about 10:00 p.m., policemen arrived at
all circumstances pointed to his guilt. His declaration faltered in the face
appellant’s house, accompanied by his wife, and forcibly opened the lock.
of the testimonies of eyewitnesses positively identifying him as one of the
When cracked open, the tomb revealed the decomposing body of a
two men who were with Rosemarie when she was killed.
woman. The corpse was brought to the Rivera Funeral Parlor where it was
identified by the victim’s mother Charlita Tallada and aunt Patricia Turlao
as that of Rosemarie, through the keloid scar on her forearm.
The prosecution was able to prove appellant’s participation in the
criminal resolve by his own admission that, right after he was told by
Pacot to close the door, he held down Rosemarie’s legs. He was pinpointed
In his defense, appellant admitted complicity in the crime but minimized
as the one who throttled the victim. He admitted that they only stopped
his participation. Appellant alleged that he only held down Rosemarie’s
when they were sure that Rosemarie was already dead. The two men
legs to prevent her from struggling and, after the latter was killed by
planned how to dispose of the victim’s body; it was in fact appellant’s idea
another man he identified as Joselito Pacot, he encased the corpse in
to pour concrete on the body, prevailing over Pacot’s suggestion to just
cement.
dump the body into the sea. It was appellant himself who encased the
body in cement and made sure that there were no leaks from which foul
odor could emanate. He was a conspirator in the killing and, whether or
not he himself did the strangling or the stabbing, he was also liable for the
acts of the other accused. The aggravating circumstance of abuse of superior
strength necessitates a showing of the relative disparity in the physical
characteristics of the aggressor and the victim such as age, gender, physical size
and strength. We agree with the trial court that the killing of Rosemarie was
committed with abuse of superior strength. As found by the court a quo, two
grown-up men against a young fragile woman whose ability to defend
herself had been effectively restrained revealed a shocking inequality of
physical strength. The victim was much weaker in constitution and could
not have possibly defended herself from her stronger assailants.
The Court, however, finds that the trial court erred in imposing the death
penalty on the ground that appellant admitted during re-cross
examination that he had a prior conviction for the death of his former live-
in partner. The fact that appellant was a recidivist was appreciated by the
trial court as a generic aggravating circumstance which increased the
imposable penalty from reclusion perpetua to death. The aggravating
circumstance of recidivism was not alleged in the information and therefore
cannot be appreciated against appellant. Hence the imposable penalty should be
reduced to reclusion perpetua.
Regarding the award of ₱50,000 as civil indemnity to the heirs of the
victim, appellant claims that said amount was awarded by the trial court
as payment for actual damages. This claim is misleading. As aptly pointed
out by the Solicitor General, the amount was granted by the trial court by
way of indemnity ex delicto to compensate for the death of the victim
which prevailing jurisprudence fixes at ₱50,000. The award of such
indemnity requires no proof other than the death of the victim and the
accused’s responsibility therefor.
The award of ₱50,000 as moral damages is proper, supported as it was by
the testimony of Charlita Tallada, the victim’s mother, that Rosemarie’s
death caused her immeasurable pain.
In addition, the Court awards ₱25,000 in temperate damages, said
amount being awarded in homicide or murder cases when no
evidence of burial and funeral expenses is presented in the trial
court.
With regard to the award of exemplary damages, the Civil Code of the
Philippines provides:
ART. 2229. Exemplary or corrective damages are imposed, by way
of example of correction for the public good, in addition to the
moral, temperate, liquidated or compensatory damages.
ART. 2230. In criminal offenses, exemplary damages as a part of
the civil liability may be imposed when the crime was committed
with one or more aggravating circumstances. Such damages are
separate and distinct from fines and shall be paid to the offended
party.
Thus, the award of exemplary damages is warranted under Art. 2230 of
the Civil Code in view of the presence of the aggravating circumstance of
abuse of superior strength. Imposition of exemplary damages is also
justified under Art. 2229 of the Civil Code in order to set an example for
the public good. For this purpose, we believe that the amount of ₱25,000
may be appropriately awarded.
DISPOSITIVE PORTION:
WHEREFORE, the assailed judgment in Criminal Case No. 45,283-2000 of
the Regional Trial Court of Davao City, Branch 31, is hereby AFFIRMED
with MODIFICATION. Appellant Francisco Dacillo y Timtim alias Dodoy
is declared guilty beyond reasonable doubt of murder as defined and
penalized under Article 248 of the Revised Penal Code. There being
neither aggravating nor mitigating circumstances, appellant is hereby
sentenced to reclusion perpetua and is further ordered to indemnify the
heirs of Rosemarie Tallada the sum of ₱50,000 as civil indemnity, ₱50,000
as moral damages, ₱25,000 as temperate damages and ₱25,000 as
exemplary damages.

[G.R. No. 181632 : September 25, 2008]
PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee, v. JESSIE BALLESTA,
Accussed-Appellant.
Facts: A criminal Complaint charging Raul Colongan, "John Doe" and "Peter
Doe" with the crime of murder was filed before the Municipal Circuit Trial
Court (MCTC), Don Carlos, Bukidnon, for preliminary investigation.
Further investigation conducted by the National Bureau of Investigation
(NBI), Cagayan de Oro City, resulted, however, in certain significant
discoveries such that after preliminary investigation, the MCTC issued an
Order dropping Raul Colongan from the Complaint. Instead, it ordered the
inclusion of the appellant as one of the accused therein. Resultantly,
appellant was charged with the crime of murder. When arraigned, appellant, with
the assistance of counsel de oficio, pleaded NOT GUILTY to the crime charged.
Accordingly, trial on the merits ensued. The prosecution presented the following
witnesses: (1) Leonisa Cosiñero (Leonisa), wife of the deceased-victim; (2)
Mailene Cosiñero (Mailene), daughter of the deceased-victim; and (3) Atty. Alex
Cabornay (Atty. Cabornay), a Senior Investigation Agent of the NBI, Cagayan de
Oro City.
For its part, the defense presented the lone testimony of the appellant who
interposed the defense of alibi.
The trial court rendered its Decision finding the appellant guilty beyond
reasonable doubt of the crime charged, the dispositive portion of which is quoted
as follows:
WHEREFORE, judgment is entered finding [appellant] Jessie Ballesta GUILTY of
the crime of murder as charged. He is hereby sentenced to suffer the penalty of
reclusion perpetua and to indemnify the heirs of his victim Quadrito Cosiñero the
sum of P50,000.00 and moral damages of P30,000.00.
The Court of Appeals rendered its Decision affirming with modification the
Decision of the trial court, the decretal portion of which reads:
WHEREFORE, the appeal is DENIED. The Decision of the RTC is hereby
AFFIRMED, but with the MODIFICATION that [appellant] Jessie Ballesta is liable
only as an ACCOMPLICE, and not as a principal, to the crime of Murder. His
sentence is therefore REDUCED to 12 years of prision mayor as minimum, to 17
years and 4 months of reclusion temporal as maximum. Moreover, while the
award of P50,000.00 as indemnity for the death of the victim is also affirmed, the
award of moral damages is hereby increased to P50,000.00.
Issue:
WON temperate damages is recoverable
Ruling: YES.
When death occurs due to a crime, the following damages may be awarded: (1)
civil indemnity ex delicto for the death of the victim; (2) actual or compensatory
damages; (3) moral damages; (4) exemplary damages; and (5) temperate
damages.47
Civil indemnity is mandatory and granted to the heirs of the victim without need
of proof other than the commission of the crime. We affirm the award of civil
indemnity given by the trial court and the Court of Appeals. Under prevailing
jurisprudence, the award of P50,000.00 to the heirs of the victim as civil
indemnity is proper.
As to actual damages, the heirs of the victim are not entitled thereto, because said
damages were not duly proved with reasonable degree of certainty. Similarly,
the heirs of the victim are not entitled to exemplary damages in the amount
of P25,000.00, since the qualifying circumstance of treachery was not
properly established.
Anent moral damages, the same is mandatory in cases of murder and homicide,
without need of allegation and proof other than the death of the victim. The
award of P50,000.00 as moral damages is likewise in order.
The award of P25,000.00 as temperate damages in homicide or murder
cases is proper when no evidence of burial and funeral expenses is
presented in the trial court. Under Article 2224 of the Civil Code, temperate
damages may be recovered, as it cannot be denied that the heirs of the victim
suffered pecuniary loss although the exact amount was not proved. Thus, this
Court similarly awards P25,000.00 as temperate damages to the heirs of the
deceased victim.
WHEREFORE, all the foregoing considered, the Decision of the Court of Appeals
in CA-G.R. CR-HC No. 00121 is hereby MODIFIED as follows: (1) appellant Jessie
Ballesta is hereby found GUILTY beyond reasonable doubt as an accomplice in
the crime of homicide; (2) there being neither aggravating nor mitigating
circumstances in the commission of the crime, the appellant is hereby sentenced
to suffer the penalty of 4 years, 2 months and 1 day of prision correccional, as
minimum, to 8 years and 1 day of prision mayor, as maximum; (3) the appellant
is likewise ORDERED to pay the heirs of Quadrito Cosiñero the amount of
P25,000.00 as temperate damages. The amount of P50,000.00 as civil indemnity
and P50,000.00 as moral damages, already awarded by the appellate court, are
MAINTAINED.
CHAPTER VI: LIQUIDATED DAMAGES
A. CONCEPT
COMMONWEALTH INSURANCE CORPORATION, Petitioner, vs. COURT OF
APPEALS and RIZAL COMMERCIAL BANKING CORPORATION, Respondents.
G.R. No. 130886, SECOND DIVISION, January 29, 2004, AUSTRIA-
MARTINEZ, J.
FACTS: In 1984, plaintiff-appellant Rizal Commercial Banking Corporation
(RCBC) granted two export loan lines, one, for ₱2,500,000.00 to Jigs
Manufacturing Corporation (JIGS) and, the other, for ₱1,000,000.00 to Elba
Industries, Inc. (ELBA). JIGS and ELBA which are sister corporations both drew
from their respective credit lines, the former in the amount of ₱2,499,992.00 and
the latter for ₱998,033.37 plus ₱478,985.05 from the case-to-case basis and trust
receipts. These loans were evidenced by promissory notes and secured by surety
bonds executed by defendant-appellee Commonwealth Insurance Company
(CIC).
Specifically, the surety bonds issued by appellee CIC in favor of appellant RCBC
to secure the obligations of JIGS totaled ₱2,894,128.00 while that securing ELBA’s
obligation was ₱1,570,000.00. Hence, the total face value of the surety bonds
issued by appellee CIC was ₱4,464,128.00.
JIGS and ELBA defaulted in the payment of their respective loans. On October 30,
1984, appellant RCBC made a written demand on appellee CIC to pay JIG’s
account to the full extend of the suretyship. A similar demand was made on
December 17, 1984 for appellee CIC to pay ELBA’s account to the full extend of
the suretyship. In response to those demands, appellee CIC made several
payments from February 25, 1985 to February 10, 1988 in the total amount of
₱2,000,000.00. There having been a substantial balance unpaid, appellant RCBC
made a final demand for payment on July 7, 1988 upon appellee CIC but the latter
ignored it. Thus, appellant RCBC filed the Complaint for a Sum of Money on
September 19, 1988 against appellee CIC.
The trial court ruled that the defendants Commonwealth Insurance Co. and
defaulted third party defendants Jigs Manufacturing Corporation, Elba Industries
and Iluminada de Guzman solidarily liable to pay Rizal Commercial Banking
Corporation the sum of P2,464,128.00, to pay the plaintiff attorney’s fees of
P10,000.00 and to pay the costs of suit.
Not satisfied with the trial court’s decision, RCBC filed a motion for
reconsideration praying that in addition to the principal sum of ₱2,464,128.00,
defendant CIC be held liable to pay interests thereon from date of demand at the
rate of 12% per annum until the same is fully paid. However, the trial court
denied the motion.
RCBC then appealed to the Court of Appeals. The CA rendered the assailed
decision, ruling thus:
Being solidarily bound, a surety’s obligation is primary so that according to Art.
1216 of the Civil Code, he can be sued alone for the entire obligation. However,
one very important characteristic of this contract is the fact that a surety’s
liability shall be limited to the amount of the bond. This does not mean however
that even if he defaults in the performance of his obligation, the extent of his
liability remains to be the amount of the bond. If he pays his obligation at maturity
upon demand, then, he cannot be made to pay more than the amount of the bond.
But if he fails or refuses without justifiable cause to pay his obligation upon a
valid demand so that he is in mora solvendi, then he must pay damages or interest
in consequence thereof according to Art. 1170. Even if this interest is in excess of
the amount of the bond, the defaulting surety is liable according to settled
jurisprudence.
ISSUE: Whether or not petitioner should be held liable to pay legal interest over
and above its principal obligation under the surety bonds issued by it.
RULING:YES. If a surety upon demand fails to pay, he can be held liable for
interest, even if in thus paying, its liability becomes more than the principal
obligation. The increased liability is not because of the contract but because of
the default and the necessity of judicial collection.
Petitioner’s liability under the suretyship contract is different from its liability
under the law. There is no question that as a surety, petitioner should not be
made to pay more than its assumed obligation under the surety bonds. However,
it is clear from jurisprudence that petitioner’s liability for the payment of interest
is not by reason of the suretyship agreement itself but because of the delay in the
payment of its obligation under the said agreement.
It is not disputed that out of the principal sum of ₱4,464,128.00 petitioner was
only able to pay ₱2,000,000.00. Letters demanding the payment of the respective
obligations of JIGS and ELBA were initially sent by RCBC to petitioner on October
30, 1984 and December 17, 1984. Petitioner made payments on an installment
basis spanning a period of almost three years, i.e., from February 25, 1985 until
February 10, 1988. On July 7, 1988, or after a period of almost five months from
its last payment, RCBC, thru its legal counsel, sent a final letter of demand asking
petitioner to pay the remaining balance of its obligation including interest.
Petitioner failed to pay. As of the date of the filing of the complaint on September
19, 1988, petitioner was even unable to pay the remaining balance of
P2,464,128.00 out of the principal amount it owes RCBC.
Petitioner’s contention that what prevented it from paying its obligation to RCBC
is the fact that the latter insisted on imposing interest and penalties over and
above the principal sum it seeks to recover is not plausible. Considering that
petitioner admits its obligation to pay the principal amount, then it should have
paid the remaining balance of ₱2,464,128.00, notwithstanding any
disagreements with RCBC regarding the payment of interest. The fact that the
negotiations for the settlement of petitioner’s obligation did not push through
does not excuse it from paying the principal sum due to RCBC.
The issue of petitioner’s payment of interest is a matter that is totally different
from its obligation to pay the principal amount covered by the surety bonds it
issued. Petitioner offered no valid excuse for not paying the balance of its
principal obligation when demanded by RCBC. Its failure to pay is, therefore,
unreasonable. Thus, we find no error in the appellate court’s ruling that
petitioner is liable to pay interest.
As to the rate of interest, we do not agree with petitioner’s contention that the
rate should be 6% per annum. The appellate court is correct in imposing 12%
interest. It is in accordance with our ruling in Eastern Shipping Lines, Inc. vs.
Court of Appeals, wherein we have established certain guidelines in awarding
interest in the concept of actual and compensatory damages.
In the present case, there is no dispute that petitioner’s obligation consists of a
loan or forbearance of money. No interest has been agreed upon in writing
between petitioner and respondent. Applying the above-quoted rule to the
present case, the Court of Appeals correctly imposed the rate of interest at 12%
per annum to be computed from the time the extra-judicial demand was made.
This is in accordance with the provisions of Article 1169 of the Civil Code and of
the settled rule that where there has been an extra-judicial demand before action
for performance was filed, interest on the amount due begins to run not from the
date of the filing of the complaint but from the date of such extra-judicial demand.
RCBC’s extra-judicial demand for the payment of JIGS’ obligation was made on
October 30, 1984; while the extra-judicial demand for the payment of ELBA’s
obligation was made on December 17, 1984. On the other hand, the complaint for
a sum of money was filed by RCBC with the trial court only on September 19,
1988.
DISPOSITIVE PORTION:
WHEREFORE, the instant petition is DENIED and the assailed Decision and
Resolution of the Court of Appeals are AFFIRMED in toto. SO ORDERED.
EMPIRE EAST LAND HOLDINGS, INC., petitioner, vs. CAPITOL INDUSTRIAL
CONSTRUCTION GROUPS, INC., respondent. | G.R. No. 168074, THIRD
DIVISION, September 26, 2008, NACHURA, J.
FACTS:
On February 12, 1997, petitioner Empire East Land Holdings, Inc. and respondent
Capitol Industrial Corporation Groups, Inc. entered into a Construction
Agreement whereby the latter bound itself to undertake the complete supply and
installation of “the building shell wet construction” of the former’s building
known as Gilmore Heights Phase I, located at Gilmore cor. Castilla St., San Juan,
Metro Manila.
Capitol Industrial’s scope of work are as follows: Masonry work, concrete works,
formworks, metal works, other concrete works, miscellaneous works,
miscellaneous items, roofing works and garbage chutes.
Respondent further agreed that the construction work would be completed
within 330 calendar days from “Day 1,” upon the Construction Manager’s
confirmation. Petitioner initially considered February 20, 1997 as “Day 1” of the
project. However, when respondent entered the project site, it could not start
work due to the on-going bulk excavation by another contractor. Respondent
thus asked petitioner to move “Day 1” to a later date, when the bulk excavation
contractor would have completely turned over the site.
After a series of correspondence between petitioner and respondent, February
25, 1997 was proposed as “Day 1.” Accordingly, respondent’s completion date of
the project was fixed on January 21, 1998.
Prior to and during the construction period, changes in circumstances arose,
prompting the parties to make adjustments in the initial terms of their contract.
The following pertinent changes were agreed upon by the parties:
First, as the bulk excavation contractor refused to return to the project
site, petitioner directed respondent to continue the excavation work;
Second, in addition to respondent’s scope of work, it was made to
perform side trimmings.
Third, petitioner directed respondent to reduce the monthly target
accomplishment to P1 million worth of work and up to one (1) floor only.
Fourth, the following were deleted from respondent’s scope of work: a)
Masonry works and all related items from 6th floor to roof deck; b) All
exterior masonry works from 4th floor to roof deck; and c) Garbage
chute.
Fifth, as a consequence of the deletion of the above works, the contract
price was reduced to P62,828,826.53.
Sixth, the parties agreed: that the items of work or any part thereof not
completed by the respondent as of February 28, 1999 should be deleted
from its contract, except demobilization; the punch list items under
respondent’s scope of responsibility not yet made good/corrected as of
the same period shall be done by others at a fixed cost to be agreed upon
by all concerned; and respondent should be compensated for the cost of
utilities it installed but were still needed by other contractors to
complete their work.
Lastly, they agreed that a joint quantification should be done to establish
the bottom line figures as to what were to be deleted from the
respondent’s contract and the cost of completing the punch list items
which were deductible from respondent’s receivables.
After the completion of the side trimmings and excavation of the building’s
foundation, respondent demanded the payment of P2,248,507.70 and
P1,805,225.90, respectively. Instead of paying the amount, petitioner agreed
with the respondent on a negotiated amount of P900,000.00 for side trimmings.
However, respondent’s claim for foundation excavation was not acted upon.
During the construction period, petitioner granted, on separate occasions,
respondent’s requests for payroll and material accommodations.
On March 13, 1999, respondent submitted its final billing, amounting to
P4,442,430.90 representing its work accomplishment and retention, less all
deductions. On March 23, 1999, a punch list was drawn as a result of the joint
inspection undertaken by the parties. Petitioner, on the other hand, refused to
issue a certificate of completion. It, instead, sent a letter to respondent informing
the latter that it was already in default.
Capitol industrial then filed a case against Empire East for unpaid contract price
and other monetary claims.
The Construction Industry Arbitration Commission (CIAC) ruled in favor of
the respondent. Empire East Land Holdings, Inc. is hereby ordered to pay Capitol
Industrial Construction Groups, Inc. the net amount of P7,765,631.81 with 6%
legal interest from the time the request for adjudication was filed with the CIAC
on September 14, 1999 up to the time this Decision becomes final and executory.
Petitioner’s claim for liquidated damages was found unmeritorious because it
allowed respondent to complete the works despite knowledge that the latter was
already in default.
The CA affirmed the CIAC’s findings of fact and conclusions of law.
Hence, the present petition.
ISSUE/S:
Whether or not petitioner is entitled to liquidated damages. (NO)
RULING:
Whether or not petitioner is entitled to liquidated damages.
NO.
Liquidated damages are those that the parties agree to be paid in case of a breach.
As worded, the amount agreed upon answers for damages suffered by the owner
due to delays in the completion of the project. Under Philippine laws, they are in
the nature of penalties. They are attached to the obligation in order to ensure
performance. As a pre-condition to such award, however, there must be proof of
the fact of delay in the performance of the obligation.
Thus, the resolution of the issue of petitioner’s entitlement to liquidated damages
hinges on whether respondent was in default in the performance of its obligation.
The completion date of the construction project was initially fixed on January 21,
1998. However, due to causes beyond the control of respondent, the latter failed
to perform its obligation as scheduled. The CIAC and the CA enumerated the
causes of the delay: the delayed issuance of building permit; additional work
undertaken by respondent, i.e., bulk excavation and side trimmings; delayed
payment of progress billings; delayed delivery of owner-supplied construction
materials; and limitation of monthly accomplishment. All these causes of
respondent’s failure to complete the project on time were attributable to
petitioner’s fault.
Still, petitioner contends that even at the start and for the entire duration of the
construction, respondent was guilty of delay due to insufficient manpower and
lack of technical know-how. Yet, petitioner allowed respondent to proceed with
the project; thus, petitioner cannot now be permitted to raise anew respondent’s
alleged delay. More importantly, respondent is not guilty of breach of the
obligation; hence, it cannot be held liable for liquidated damages.
DISPOSITIVE PORTION:
WHEREFORE, premises considered, the petition is PARTIALLY GRANTED. The
Decision of the Court of Appeals dated November 3, 2004 and its Resolution
dated May 10, 2005 in CA-G.R. SP No. 58980, are MODIFIED by deleting the award
of additional overhead cost amounting to P1,397,642.70.
The petitioner is directed to issue to respondent the required certificate of
completion in order to enable the latter to obtain the corresponding guarantee
bond. In view of the non-fulfillment of the conditions-precedent, the release of
the retention money is hereby held in abeyance. Thus, respondent is ordered to
pay the petitioner P875,601.31 subject to the return of the amount when
respondent shall have complied with the conditions aforesaid.
SO ORDERED.
- SAB
B. Rules Governing in case of Breach of Contract Art. 2228 New Civil Code
NATIONAL POWER CORPORATION, Plaintiff-Appellant, v. NATIONAL
MERCHANDISING CORPORATION and DOMESTIC INSURANCE COMPANY OF
THE PHILIPPINES, Defendants-Appellants.
G.R. Nos. L-33819 and L-33897, SECOND DIVISION, October 23, 1982,
AQUINO, J.
FACTS:
Plaintiff-appellant National Power Corporation (NPC) and defendant- appellant
National Merchandising Corporation (NAMERCO), the Philippine representative
of New York-based International Commodities Corporation, executed a contract
of sale of sulfur with a stipulation for liquidated damages in case of breach.
Defendant-appellant Domestic Insurance Company executed a performance
bond in favor of NPC to guarantee the seller’s obligation. In entering into the
contract, Namerco, however, did not disclose to NPC that Namerco’s principal, in
a cabled instruction, stated that the sale was subject to availability of a steamer,
and contrary to its principal’s instruction, Namerco agreed that non-availability
of a steamer was not a justification for non-payment of liquidated damages. The
New York supplier was not able to deliver the sulfur due to its inability to secure
shipping space. Consequently, the Government Corporate Counsel rescinded the
contract of sale due to the supplier’s non-performance of its obligations, and
demanded payment of liquidated damages from both Namerco and the surety.
Thereafter, NPC sued for recovery of the stipulated liquidated damages. After
trial, the Court of First Instance rendered judgment ordering defendants-
appellants to pay solidarity to the NPC reduced liquidated damages with interest.
ISSUES:
1. Whether or not the contract was enforceable.
2. Whether or not NPC is entitled to liquidated damages.
RULING:
1. YES. According to Naperco: Article 1403 of the Civil Code provides that a
contract entered into in the name of another person by one who has acted beyond
his powers is unenforceable. Therefore, the stipulation for liquidated damages
was allegedly unenforceable.
Article 1403 refers to the unenforceability of the contract against the principal.
In this case, the contract containing the stipulation for liquidated damages is not
being enforced against its principal but against the agent and its surety. It is being
enforced against the agent because Article1897 implies that the agent who acts
in excess of his authority is personally liable to the party with whom he
contracted.Therefore, Namerco is bound by the stipulation for liquidated
damages in the contract.
2. YES. The contention that only nominal damages should be adjudged is contrary
to the intention of the parties (NPC, Namerco and its surety) because it is clearly
pro-vided that liquidated damages are recoverable for delay in the delivery of the
sulfur and, with more reason, for non-delivery. No proof of pecuniary loss is
required for the recovery of liquidated damages. The stipulation for liquidated
damages is intended to obviate controversy on the amount of damages.
There can be no question that the NPC suffered damages because its production
of fertilizer was disrupted or diminished by reason of the non-delivery of the
sulfur. The parties foresaw that it might be difficult to ascertain the exact amount
of damages for non-delivery of the sulfur. So, they fixed the liquidated damages
to be paid as indemnity to the NPC.
-Rochelle
RADIOWEALTH FINANCE COMPANY, petitioner, vs. Spouses VICENTE and
MA. SUMILANG DEL ROSARIO, respondents.
G.R. No. 138739 July 6, 2000
FACTS:
On March 2, 1991, Spouses Vicente and Maria Sumilang del Rosario, jointly and
severally executed, signed and delivered in favor of Radiowealth Finance
Company, a Promissory Note5 for ₱138,948. Thereafter, Sps. Del Rosario
defaulted on the monthly installments. Despite repeated demands, they failed to
pay their obligations under their Promissory Note.
On June 7, 1993, Radiowealth filed a Complaint for the collection of a sum of
money before the RTC of Manila. During the trial, Jasmer Famatico, the credit and
collection officer of Radiowealth, presented in evidence Sps. Del Rosario’s check
payments, the demand letter, the customer’s ledger card for the respondents,
another demand letter and Metropolitan Bank dishonor slips. Famatico admitted
that he did not have personal knowledge of the transaction or the execution of
any of these pieces of documentary evidence, which had merely been endorsed
to him.
Sps. Del Rosario filed a Demurrer to Evidence for alleged lack of cause of action.
The RTC dismissed the complaint for failure of petitioner to substantiate its
claims, the evidence it had presented being merely hearsay.
On appeal, the CA reversed the trial court and remanded the case for further
proceedings. According to the CA, the judicial admissions of Sps. Del Rosario
established their indebtedness to the petitioner, on the grounds that they
admitted the due execution of the Promissory Note, and that their only defense
was the absence of an agreement on when the installment payments were to
begin. Even if the petitioner’s witness had no personal knowledge of these
documents, they would still be admissible. Besides, Articles 19 and 22 of the Civil
Code require that every person must -- in the exercise of rights and in the
performance of duties -- act with justice, give all else their due, and observe
honesty and good faith. Further, the rules on evidence are to be liberally
construed in order to promote their objective and to assist the parties in
obtaining just, speedy and inexpensive determination of an action.
ISSUES:
Whether the obligation was already due and demandable.
RULING:
Respondents claim that the installments were not yet due and demandable.
Petitioner had allegedly allowed them to apply their promotion services for its
financing business as payment of the Promissory Note. This was supposedly
evidenced by the blank space left for the date on which the installments should
have commenced.
This contention is untenable. The act of leaving blank the due date of the first
installment did not necessarily mean that the debtors were allowed to pay as and
when they could. If this was the intention of the parties, they should have so
indicated in the Promissory Note. However, it did not reflect any such intention.
On the contrary, the Note expressly stipulated that the debt should be amortized
monthly in installments of ₱11,579 for twelve consecutive months. While the
specific date on which each installment would be due was left blank, the Note
clearly provided that each installment should be payable each month.
Furthermore, it also provided for an acceleration clause and a late payment
penalty, both of which showed the intention of the parties that the installments
should be paid at a definite date. Had they intended that the debtors could pay as
and when they could, there would have been no need for these two clauses.
Verily, the contemporaneous and subsequent acts of the parties manifest their
intention and knowledge that the monthly installments would be due and
demandable each month. In this case, the conclusion that the installments had
already became due and demandable is bolstered by the fact that respondents
started paying installments on the Promissory Note, even if the checks were
dishonored by their drawee bank. We are convinced neither by their avowals that
the obligation had not yet matured nor by their claim that a period for payment
should be fixed by a court.
Convincingly, petitioner has established not only a cause of action against the
respondents, but also a due and demandable obligation. The obligation of the
respondents had matured and they clearly defaulted when their checks bounced.
Per the acceleration clause, the whole debt became due one month after the date
of the Note because the check representing their first installment bounced.
Petitioner, in its Complaint, prayed for "14% interest per annum from May
6, 1993 until fully paid." We disagree. The Note already stipulated a late
payment penalty of 2.5 percent monthly to be added to each unpaid
installment until fully paid. Payment of interest was not expressly
stipulated in the Note. Thus, it should be deemed included in such penalty.
In addition, the Note also provided that the debtors would be liable for
attorney’s fees equivalent to 25 percent of the amount due in case a legal
action was instituted and 10 percent of the same amount as liquidated
damages. Liquidated damages, however, should no longer be imposed for
being unconscionable. Such damages should also be deemed included in the
2.5 percent monthly penalty. Furthermore, we hold that petitioner is
entitled to attorney’s fees, but only in a sum equal to 10 percent of the
amount due which we deem reasonable under the proven facts.
The Court deems it improper to discuss respondents' claim for moral and
other damages. Not having appealed the CA Decision, they are not entitled
to affirmative relief, as already explained earlier.
JOSE MENCHAVEZ, JUAN MENCHAVEZ JR., SIMEON MENCHAVEZ, RODOLFO
MENCHAVEZ, CESAR MENCHAVEZ, REYNALDO, MENCHAVEZ, ALMA
MENCHAVEZ, ELMA MENCHAVEZ, CHARITO M. MAGA, FE M. POTOT,
THELMA M. REROMA, MYRNA M. YBAÑEZ, and SARAH M. VILLABER,
petitioners,
vs.
FLORENTINO TEVES JR., respondent.
G.R. No. 153201 January 26, 2005 PANGANIBAN, J.
FACTS:
On February 28, 1986, a "Contract of Lease" over a fishpond located at Cebu City
with an area of 10 hectares was executed by Jose S. Menchavez, Juan S. Menchavez
Sr., Juan S. Menchavez Jr., Rodolfo Menchavez, Simeon Menchavez, Reynaldo
Menchavez, Cesar Menchavez, Charito M. Maga, Fe M. Potot, Thelma R. Reroma,
Myrna Ybañez, Sonia S. Menchavez, Sarah Villaver, Alma S. Menchavez, and Elma
S. Menchavez, as lessors; and Florentino Teves Jr. as lessee. The pertinent
portions of the Contract are herein reproduced as follows:
On June 2, 1988, Cebu RTC Sheriffs Gumersindo Gimenez and Arturo Cabigon
demolished the fishpond dikes constructed by respondent and delivered
possession of the subject property to other parties. As a result, he filed a
Complaint for damages with application for preliminary attachment against
petitioners. In his Complaint, he alleged that the lessors had violated their
Contract of Lease, specifically the peaceful and adequate enjoyment of the
property for the entire duration of the Contract. He claimed ₱157,184.40 as
consequential damages for the demolition of the fishpond dikes, ₱395,390.00 as
unearned income, and an amount not less than ₱100,000.00 for rentals paid.
Respondent further asserted that the lessors had withheld from him the findings
of the trial court in Civil Case No. 510-T, entitled "Eufracia Colongan and Paulino
Pamplona v. Juan Menchavez Sr. and Sevillana S. Menchavez." In that case
involving the same property, subject of the lease, the Menchavez spouses were
ordered to remove the dikes illegally constructed and to pay damages and
attorney’s fees.
Petitioners filed a Third Party Complaint against Benny and Elizabeth Allego,
Albino Laput, Adrinico Che and Charlemagne Arendain Jr., as agents of Eufracia
Colongan and Paulino Pamplona. The third-party defendants maintained that the
Complaint filed against them was unfounded. As agents of their elderly parents,
they could not be sued in their personal capacity. Thus, they asserted their own
counterclaims.
The trial court ruled that under the Regalian Doctrine, the lease contract between
Florentino Teves, Jr. and Juan Menchavez Sr. and his family is a patent nullity.
Being a patent nullity, [petitioners] could not give any rights to Florentino Teves,
Jr. under the principle: ‘NEMO DAT QUOD NON HABET’ - meaning ONE CANNOT
GIVE WHAT HE DOES NOT HAVE, considering that this property in litigation
belongs to the State and not to [petitioners]. Therefore, the first issue is resolved
in the negative, as the court declares the contract of lease as invalid and void ab-
initio. "On the issue of whether [respondent] and [petitioners] are guilty of
mutual fraud, the court rules that the [respondent] and [petitioners] are in pari-
delicto. As a consequence of this, the court must leave them where they are found.
On the third issue of whether the third party defendants are liable for
demolishing the dikes pursuant to a writ of execution issued by the lower court[,
t]his must be resolved in the negative, that the third party defendants are not
liable. First, because the third party defendants are mere agents of Eufracia
Colongan and Eufenio Pamplona, who are the ones who should be made liable if
at all, and considering that the demolition was pursuant to an order of the court
to restore the prevailing party in that Civil Case 510-T, entitled: Eufracia
Colongan v. Menchavez.
The CA disagreed with the RTC’s finding that petitioners and respondent were in
pari delicto. It contended that while there was negligence on the part of
respondent for failing to verify the ownership of the subject property, there was
no evidence that he had knowledge of petitioners’ lack of ownership. The CA
ruled that respondent could recover actual damages in the amount of
₱128,074.40. Citing Article 1356 of the Civil Code, it further awarded liquidated
damages in the amount of ₱50,000, notwithstanding the nullity of the Contract.
ISSUES:
1. Whether or not the parties are in pari delicto?
2. Whether or not the award of liquidated damages is proper?
RULING:
The Petition has merit
In Pari Delicto Rule on Void Contracts
The parties do not dispute the finding of the trial and the appellate courts that
the Contract of Lease was void. Indeed, the RTC correctly held that it was the
State, not petitioners, that owned the fishpond. The 1987 Constitution specifically
declares that all lands of the public domain, waters, fisheries and other natural
resources belong to the State. Included here are fishponds, which may not be
alienated but only leased. Possession thereof, no matter how long, cannot ripen
into ownership.
Being merely applicants for the lease of the fishponds, petitioners had no
transferable right over them. And even if the State were to grant their application,
the law expressly disallowed sublease of the fishponds to respondent. Void are
all contracts in which the cause, object or purpose is contrary to law, public order
or public policy.
Parties to a void agreement cannot expect the aid of the law; the courts leave
them as they are, because they are deemed in pari delicto or "in equal fault." To
this rule, however, there are exceptions that permit the return of that which may
have been given under a void contract. One of the exceptions is found in Article
1412 of the Civil Code, which states:
"Art. 1412. If the act in which the unlawful or forbidden cause consists does not
constitute a criminal offense, the following rules shall be observed:
"(1) When the fault is on the part of both contracting parties, neither may recover
what he has given by virtue of the contract, or demand the performance of the
other’s undertaking;
"(2) When only one of the contracting parties is at fault, he cannot recover what
he has given by reason of the contract, or ask for the fulfillment of what has been
promised him. The other, who is not at fault, may demand the return of what he
has given without any obligation to comply with his promise."
On this premise, respondent contends that he can recover from petitioners,
because he is an innocent party to the Contract of Lease. Petitioners allegedly
induced him to enter into it through serious misrepresentation.
Finding of In Pari Delicto:
A Question of Fact
The evidence of respondent himself shows that he negotiated the lease of the
fishpond with both Juan Menchavez Sr. and Juan Menchavez Jr. in the office of his
lawyer, Atty. Jorge Esparagoza. His counsel’s presence during the negotiations,
prior to the parties’ meeting of minds, further debunks his claim of lack of
knowledge. Lawyers are expected to know that fishponds belong to the State and
are inalienable. It was reasonably expected of the counsel herein to advise his
client regarding the matter of ownership.
Indeed, the evidence presented by respondent demonstrates the contradictory
claims of petitioners regarding their alleged ownership of the fishpond. On the
one hand, they claimed ownership and, on the other, they assured him that their
fishpond lease application would be approved. This circumstance should have
been sufficient to place him on notice. It should have compelled him to determine
their right over the fishpond, including their right to lease it.
The Contract itself stated that the area was still covered by a fishpond application.
Nonetheless, although petitioners declared in the Contract that they co-owned
the property, their erroneous declaration should not be used against them. A
cursory examination of the Contract suggests that it was drafted to favor the
lessee. It can readily be presumed that it was he or his counsel who prepared it -
- a matter supported by petitioners’ evidence. The ambiguity should therefore be
resolved against him, being the one who primarily caused it.
The CA erred in finding that petitioners had failed to prove actual knowledge of
respondent of the ownership status of the property that had been leased to him.
On the contrary, as the party alleging the fact, it was he who had the burden of
proving – through a preponderance of evidence -- that they misled him regarding
the ownership of the fishpond. His evidence fails to support this contention.
Instead, it reveals his fault in entering into a void Contract. As both parties are
equally at fault, neither may recover against the other.
Liquidated Damages Not Proper
The CA erred in awarding liquidated damages, notwithstanding its finding that
the Contract of Lease was void. Even if it was assumed that respondent was
entitled to reimbursement as provided under paragraph 1 of Article 1412 of the
Civil Code, the award of liquidated damages was contrary to established legal
principles.
Liquidated damages are those agreed upon by the parties to a contract, to be paid
in case of a breach thereof. Liquidated damages are identical to penalty insofar
as legal results are concerned. Intended to ensure the performance of the
principal obligation, such damages are accessory and subsidiary obligations. In
the present case, it was stipulated that the party responsible for the violation of
the terms, conditions and warranties of the Contract would pay not less than
₱50,000 as liquidated damages. Since the principal obligation was void, there was
no contract that could have been breached by petitioners; thus, the stipulation on
liquidated damages was inexistent. The nullity of the principal obligation carried
with it the nullity of the accessory obligation of liquidated damages.
As explained earlier, the applicable law in the present factual milieu is Article
1412 of the Civil Code. This law merely allows innocent parties to recover what
they have given without any obligation to comply with their prestation. No
damages may be recovered on the basis of a void contract; being nonexistent, the
agreement produces no juridical tie between the parties involved. Since there is
no contract, the injured party may only recover through other sources of
obligations such as a law or a quasi-contract. A party recovering through these
other sources of obligations may not claim liquidated damages, which is an
obligation arising from a contract.
WHEREFORE, the Petition is GRANTED and the assailed Decision and Resolution
SET ASIDE. The Decision of the trial court is hereby REINSTATED.
C. What is Moratory Interest –Art. 2211, New Civil Code
Mendoza vs. Gomez
MARIANO C. MENDOZA AND ELVIRA LIM v. SPOUSES LEONORA J. GOMEZ
AND GABRIEL V. GOMEZ
G.R. No. 160110, June 18, 2014, PEREZ, J.
An Isuzu truck owned by respondent Leonora J. Gomez (Leonora) and driven by
Antenojenes Perez (Perez), was hit by a Mayamy bus registered under the name
of petitioner Elvira Lim (Lim) and driven by petitioner Mariano C. Mendoza
(Mendoza).
Owing to the incident, an Information for reckless imprudence resulting in
damage to property and multiple physical injuries was filed against Mendoza.
Mendoza, however, eluded arrest, thus, respondents filed a separate complaint
for damages against Mendoza and Lim, seeking actual damages, compensation
for lost income, moral damages, exemplary damages, attorney’s fees and costs of
the suit.
As a result of the incident, Perez, as well as the helpers on board the Isuzu truck,
namely Melchor V. Anla (Anla), Romeo J. Banca (Banca), and Jimmy Repisada
(Repisada), sustained injuries necessitating medical treatment amounting to
P11,267.35, which amount was shouldered by respondents. Moreover, the Isuzu
truck sustained extensive damages on its cowl, chassis, lights and steering wheel,
amounting to P142,757.40.
Additionally, respondents averred that the mishap deprived them of a daily
income of P1,000.00. Engaged in the business of buying plastic scraps and
delivering them to recycling plants, respondents claimed that the Isuzu truck was
vital in the furtherance of their business.
For their part, petitioners capitalized on the issue of ownership of the bus in
question. Respondents argued that although the registered owner was Lim, the
actual owner of the bus was SPO1 Cirilo Enriquez (Enriquez), who had the bus
attached with Mayamy Transportation Company (Mayamy Transport) under the
so-called “kabit system.” Respondents then impleaded both Lim and Enriquez.
Petitioners, on the other hand, presented Teresita Gutierrez (Gutierrez), whose
testimony was offered to prove that Mayamy Bus or Mayamy Transport is a
business name registered under her name, and that such business is a sole
proprietorship. Such was presented by petitioners to rebut the allegation of
respondents that Mayamy Transport is a corporation; and to show, moreover,
that although Gutierrez is the sole proprietor of Mayamy Transport, she was not
impleaded by respondents in the case at bar.
After weighing the evidence, the RTC found Mendoza liable for direct personal
negligence under Article 2176 of the Civil Code, and it also found Lim vicariously
liable under Article 2180 of the same Code.
As regards Lim, the RTC relied on the Certificate of Registration issued by the
Land Transportation Office on 9 December 1996 in concluding that she is the
registered owner of the bus in question. Although actually owned by Enriquez,
following the established principle in transportation law, Lim, as the registered
owner, is the one who can be held liable
Thus, the RTC disposed of the case as follows:
WHEREFORE, judgment is hereby rendered in favor of the [respondents] and
against the [petitioners]:
1. Ordering the [petitioners] except Enriquez to pay
[respondents], jointly and severally, the costs of repair of the
damaged vehicle in the amount of P142,757.40;
2. Ordering the defendants except Enriquez to pay
[respondents], jointly and severally, the amount of P1,000.00
per day from March 7, 1997 up to November 1997 representing
 the unrealized income of the [respondents] when the incident
transpired up to the time the damaged Isuzu truck was repaired;
3. Ordering the [petitioners] except Enriquez to pay
[respondents], jointly and severally, the amount of P100,000.00
as moral damages, plus a separate amount of P50,000.00 as
exemplary damages;
4. Ordering the [petitioners] except Enriquez to pay
[respondents], jointly and severally, the amount of P50,000.00
as attorney’s fees;
5. Ordering the [petitioners] except Enriquez to pay
[respondents] the costs of suit.18
Displeased, petitioners appealed to the CA, which appeal was docketed as CA-G.R.
CV No. 71877. After evaluating the damages awarded by the RTC, such were
affirmed by the CA with the exception of the award of unrealized income which
the CA ordered deleted, viz:
WHEREFORE, premises considered, the appeal is PARTLY GRANTED.
The judgment of the Regional Trial Court of Valenzuela City, Branch 172
dated January 31, 2001, is MODIFIED, in that the award of P1,000.00 per
day from March 1997 up to November 1997 representing unrealized
income is DELETED. The award of P142,757.40 for the cost of repair of
the damaged vehicle, the award of P100,000.00 as moral damages, the
award of P50,000.00 as exemplary damages, the award of P50,000.00 as
attorney’s fees and the costs of the suit are hereby MAINTAINED.
ISSUES:
1. Whether or not Mendoza’s negligence was duly proven. (YES)
2. If Mendoza is negligent, who is deemed as Mendoza’s employer? Is it Enriquez,
the actual owner of the bus or Lim, the registered owner of the bus? (LIM)
3. What may be awarded
(Note: Moratory Interest is the subject of this discussion)
RULING:
1. YES. Mendoza’s Negligence was duly proven
Negligence is defined as the failure to observe for the protection of the interests
of another person, that degree of care, precaution and vigilance which the
circumstances justly demand, whereby such other person suffers injury.
As found by the RTC, and affirmed by the CA, Mendoza was negligent in driving
the subject Mayamy bus, as demonstrated by the fact that, at the time of the
collision, the bus intruded on the lane intended for the Isuzu truck. Having
encroached on the opposite lane, Mendoza was clearly in violation of traffic laws.
Article 2185 of the Civil Code provides that unless there is proof to the contrary,
it is presumed that a person driving a motor vehicle has been negligent if at the
time of the mishap, he was violating any traffic regulation. In the case at bar,
Mendoza’s violation of traffic laws was the proximate cause of the harm.
2. Lim, the registered owner of the bus, is the person liable with Mendoza
In Filcar Transport Services v. Espinas, we held that the registered owner is
deemed the employer of the negligent driver, and is thus vicariously liable under
Article 2176, in relation to Article 2180, of the Civil Code. Citing Equitable Leasing
Corporation v. Suyom, the Court ruled that in so far as third persons are
concerned, the registered owner of the motor vehicle is the employer of the
negligent driver, and the actual employer is considered merely as an agent of such
owner. Thus, whether there is an employer-employee relationship between the
registered owner and the driver is irrelevant in determining the liability of the
registered owner who the law holds primarily and directly responsible for any
accident, injury or death caused by the operation of the vehicle in the streets and
highways.
Generally, when an injury is caused by the negligence of a servant or employee,
there instantly arises a presumption of law that there was negligence on the part
of the master or employer either in the selection of the servant or employee
(culpa in eligiendo) or in the supervision over him after the selection (culpa
vigilando), or both. The presumption is juris tantum and not juris et de jure;
consequently, it may be rebutted. Accordingly, the general rule is that if the
employer shows to the satisfaction of the court that in the selection and
supervision of his employee he has exercised the care and diligence of a good
father of a family, the presumption is overcome and he is relieved of liability.
However, with the enactment of the motor vehicle registration law, the
defenses available under Article 2180 of the Civil Code - that the employee
acts beyond the scope of his assigned task or that it exercised the due
diligence of a good father of a family to prevent damage – are no longer
available to the registered owner of the motor vehicle, because the motor
vehicle registration law, to a certain extent, modified Article 2180.
As such, there can be no other conclusion but to hold Lim vicariously liable with
Mendoza
This does not mean, however, that Lim is left without any recourse against
Enriquez and Mendoza. Under the civil law principle of unjust enrichment, the
registered owner of the motor vehicle has a right to be indemnified by the actual
employer of the driver; and under Article 2181 of the Civil Code, whoever pays
for the damage caused by his dependents or employees may recover from the
latter what he has paid or delivered in satisfaction of the claim
3. Having identified the persons liable, our next question is what may be
awarded.
Actual or Compensatory Damages. Actual or compensatory damages are those
awarded in satisfaction of, or in recompense for, loss or injury sustained. They
simply make good or replace the loss caused by the wrong
In the case at bar, the RTC, basing on the receipts submitted by respondents and
which receipts petitioners had the opportunity to examine, found that the total
repairs on the Isuzu truck amounted to P142,757.40, and that the full
hospitalization and medical expenses of Perez, Anla, Banca, and Repisada
amounted to P11,267.35. As such, these are the amounts that respondents are
entitled to as actual and compensatory damages.
Although respondents alleged in their complaint that the damage to their Isuzu
truck caused them the loss of a daily income of P1,000.00, such claim was not
duly substantiated by any evidence on record, and thus cannot be awarded in
their favor
Moral Damages. Moral damages are awarded 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.
A review of the complaint and the transcript of stenographic notes yields the
pronouncement that respondents neither alleged nor offered any evidence of
besmirched reputation or physical, mental or psychological suffering incurred by
them.
Exemplary Damages. Article 2229 of the Civil Code provides that exemplary or
corrective damages are imposed, by way of example or correction for the public
good, in addition to moral, temperate, liquidated or compensatory damages.
Article 2231 of the same Code further states that in quasi-delicts, exemplary
damages may be granted if the defendant acted with gross negligence.
In the case at bar, having established respondents’ right to compensatory
damages, exemplary damages are also in order, given the fact that Mendoza was
grossly negligent in driving the Mayamy bus. His act of intruding or encroaching
on the lane rightfully occupied by the Isuzu truck shows his reckless disregard
for safety.
In Baño v. Bachelor Express, Inc., et al., where an erring bus, in the process of
overtaking a jeepney, also encroached on the opposite lane, and consequently
collided with a dump truck, the Court held the driver of the bus grossly negligent
and affirmed the award of exemplary damages.
Attorney’s Fees. Article 2208 of the Civil Code enumerates the instances when
attorney’s fees may be recovered
Art. 2208. In the absence of stipulation, attorney’s fees and expenses of litigation,
other than judicial costs, cannot be recovered, except:
(1) When exemplary damages are awarded;
(2) When the defendant’s act or omission has compelled the
plaintiff to litigate with third persons or to incur expenses to protect his
interest;
(3) In criminal cases of malicious prosecution against the plaintiff;
(4) In case of a clearly unfounded civil action or proceeding against
the plaintiff;
(5) Where the defendant acted in gross and evident bad faith in
refusing to satisfy the plaintiff’s valid and demandable claim;
 (6) In actions for legal support;
(7) In actions for the recovery of wages of household helpers,
laborers and skilled workers;
(8) In actions for indemnity under workmen’s compensation and
employer’s liability laws;
(9) In a separate civil action to recover civil liability arising from a
crime;
(10) When at least double judicial costs are awarded;
(11) In any other case where the court deems it just and equitable
that attorney’s fees and expenses of litigation should be recovered;
In all cases, the attorney’s fees and expenses of litigation must be
reasonable.
In the case at bar, the RTC Decision had nil discussion on the propriety of
attorney’s fees, and it merely awarded such in the dispositive. The CA Decision,
on the other hand, merely stated that the award of attorney’s fees is merited as
such is allowed when exemplary damages are awarded. 50 Following established
jurisprudence, however, the CA should have disallowed on appeal said award of
attorney’s fees as the RTC failed to substantiate said award.
Costs of suit. The Rules of Court provide that, generally, costs shall be allowed to
the prevailing party as a matter of course, thus:
Section 1. Costs ordinarily follow results of suit.- Unless otherwise provided in
these rules, costs shall be allowed to the prevailing party as a matter of course,
but the court shall have power, for special reasons, to adjudge that either party
shall pay the costs of an action, or that the same be divided, as may be equitable.
No costs shall be allowed against the Republic of the Philippines, unless
otherwise provided by law.
In the present case, the award of costs of suit to respondents, as the prevailing
party, is in order.
Interests. Interest by way of damages has been defined as interest allowed in
actions for breach of contract or tort for the unlawful detention of money
already due. This type of interest is frequently called “moratory interest.”
Interest as a part of damage, is allowed, not by application of arbitrary
rules, but as a result of the justice of the individual case and as
compensation to the injured party.
The legal provision on interests in quasi-delicts is Article 2211 of the Civil Code
which provides that in crimes and quasi-delicts, interest as part of the damage,
may, in a proper case, be adjudicated in the discretion of the court.
Generally, interest is allowed as a matter of right for failure to pay liquidated
claims when due. For unliquidated claims, however, Article 2213 of the Civil Code
provides that interest cannot be recovered upon unliquidated claims or damages,
except when the demand can be established with reasonable certainty.
In the case at bar, although the award of exemplary damages is unliquidated in
the sense that petitioners cannot know for sure, before judgment, the exact
amount that they are required to pay to respondents, the award of actual or
compensatory damages, however, such as the truck repairs and medical
expenses, is arguably liquidated in that they can be measured against a
reasonably certain standard. Moreover, justice would seem to require that the
delay in paying for past losses which can be made reasonably certain should be
compensated through an award of interest
Dispositive Portion:
WHEREFORE, premises considered, the Court Resolves to PARTIALLY GRANT
the appeal by certiorari, as follows:
1) DECLARE Mariano Mendoza and Elvira Lim solidarily liable to respondent
Spouses Leonora and Gabriel Gomez ;
2) MAINTAIN the award of actual or compensatory damages in the amount of
Pl42,757.40 for the repair of the Isuzu Elf truck, with legal interest beginning 31
January 2001 until fully paid;
3) GRANT additional actual or compensatory damages in the amount of
P11,267.35 for the medical expenses shouldered by respondent Spouses Leonora
and Gabriel Gomez, with legal interest beginning 31 January 2001 until fully paid;
4) DELETE the award of moral damages;
5) MAINTAIN the award of exemplary damages at P50,000.00;
6) DELETE the award of attorney's fees; and
7) MAINTAIN the award of costs of suit.
SO ORDERED.
EXEMPLARY OR CORRECTIVE DAMAGES
A. Concept
Art 2229, New Civil Code
PAN PACIFIC COMPANY (PHILIPPINES), Plaintiff-Appellee, v. PHILIPPINE
ADVERTISING CORPORATION and JOHN W. MEARS, Defendants,
PHILIPPINE ADVERTISING CORPORATION, Defendant-Appellant.
G.R. No. L-22050, June 13, 1968, CONCEPCION, C.J.:
FACTS:
The defendants had payments coming to them from the War Damage
Commission. Wilfred Hurst had worked together with John W. Mears of the
defendant corporation prior to the war. Hurst, who was then Vice-President of
the plaintiff corporation 1 suggested to Mears that the defendant reinvest part of
the war damage payment due defendant corporation in bowling alleys. The
plaintiff was then distributor of BrunswickBalke-Collender Company of the
United States, manufacturer of bowling alleys. Mears was interested, and,
accordingly, secured the approval of the War Damage Commission to re-invest
part of the war damage payment due the defendant Philippine Advertising
Corporation in bowling alleys. After continuous negotiations, plaintiff, thru Hurst,
and defendant, thru Mears, finally came into an agreement.
Appellant denies plaintiff’s right to collect this balance upon the ground that: 1)
the sum of P30,661.90, representing the aggregate amount of inland freight,
ocean freight, arrastre and sales tax, should be deemed included in the price
agreed upon; 2) eight (8) of the bowling alleys installed by the plaintiff were
"second-hand", not the new ones ordered by the defendants; 3) the bowling
alleys installed by the plaintiff were of a lower quality than those ordered by the
defendants; and 4) the installations made by the plaintiff were defective.
As regards inland and ocean freights, the arrastre and the sales tax, plaintiff
alleges that these charges are due from the defendants, because Exhibits A and D
explicitly provide that the prices therein quoted include "the cost of the alleys,
additional equipment and installation cost but does not include freight charges
for accessories that will have to be ordered from the U.S." Moreover, Exhibit D
explicitly declares "that any luxury or additional sales tax that may be imposed
by the Philippine Government upon the arrival of the merchandise" would be for
defendants’ account.
Upon the other hand, appellant asserts that none of the goods supplied by
plaintiff are "accessories" covered by the aforementioned provision in Exhibits A
and D, and that in resolving the issue as to what are "accessories", the Court
cannot go beyond the terms of said exhibits.
ISSUE:
Whether or not appellant liable to pay damages (YES)
RULING:
Appellant asserts that it is under no obligation to pay the interest and attorney’s
fees referred to in said invoices, because it had not agreed to the above-quoted
provision, the invoices for the goods having been signed by Prudencia Arboleda,
a mere clerk of appellant herein, and because, in fact, Mears had written on
appellant’s copy of one of said invoices — Exhibit G-1 — the words "Received
copy but not conformed." Appellant’s witness, Miss Arboleda declared, however,
that she had authority to receive said invoices or copies thereof; that she,
thereupon, turned them over to defendant Mears; and that the latter received
said copies, without expressing any objection thereto. Then, also, it appears that
the note, expressing his non-conformity with the provisions of Exhibit G-1, was
written by him on said copy, dated March 15, 1951, about a month and a half later,
or on April 27, 1951. Again, defendants did not try to cause a similar entry to be
made in plaintiff’s original invoice, or to otherwise advise the plaintiff of
defendants’ objection to the provisions of said invoice. Worse still, appellant kept
and used the billiard tables, the bowling alleys and the accessories or equipment
described in the aforementioned invoices, without offering either to pay the
amounts thereof or to return said goods. In the language of His Honor, the trial
Judge, "His acceptance of the equipment and supplies and accessories, and the
use he made of them is an implied conformity to the terms of the invoices and he
is bound thereby."
Passing upon plaintiff’s claim for damages and attorney’s fees, the lower court
awarded therefor P20,000.00 and P15,000.00, respectively, upon the following
grounds:
"Under the fifth cause of action, plaintiff seeks to recover moral damages for the
alleged wanton refusal of the defendants to pay their just obligation to the
plaintiff and for taking advantage of the plaintiff’s good faith. Article 2229 of the
New Civil Code provides that ‘exemplary or corrective damages are imposed, by
way of example or correction for the public good, in addition to the moral,
temperate, liquidated or compensatory damages’. And Article 2232 provides that
‘in contracts and quasi-contracts, the court may award exemplary damages if the
defendant acted in a wanton, fraudulent, reckless, oppressive, or malevolent
manner’. The records of this case amply demonstrate that the defendants, in utter
disregard of the rights of the plaintiff, had refused deliberately and wantonly to
pay the plaintiff what is justly due. The installation of the bowling alleys, together
with their equipment, and the billiard tables had brought the defendant a
lucrative income from the year of its opening in 1951, to the present; and yet
outside of the down payment which defendant had paid on the 18 bowling alleys,
defendant had absolutely refused, which the Court has found without just cause,
to pay the balance thereof and the cost of the bowling and billiard accessories —
this notwithstanding that the defendant had promised to pay the balance of the
price of the bowling alleys in installments, the first installment to be paid on the
day that the plaintiff would commence work on the bowling alleys. Defendant,
taking advantage of the plaintiff’s good faith, requested a deferment of the
payment until the installation shall have been completed; but the installation
having been completed, defendants under one pretext or another, refused
without just cause to pay what is due the
plaintiff. Not only that, but defendant Mear’s attitude towards the plaintiff was
characterized by arrogance and his letters are replete with unsavory and
discourteous remarks, which demonstrate not only the character of the man but
reveal his lack of intention to pay defendant’s just obligation.
"Plaintiff is entitled to actual damages consisting in the payment of interest and
attorney’s fees, and considering that the defendants had acted wantonly,
oppressively, if not fraudulently, in the performance of their obligation, plaintiff
is likewise entitled to moral and exemplary damages, which the Court fixes in the
amount of P20,000.00. Under the first cause of action, plaintiff is entitled to
attorney’s fees, since plaintiff in accordance with Article 2208 of the New Civil
Code, has been awarded exemplary damages, and because defendant acted in
gross and evident bad faith in refusing to satisfy the plaintiff’s plainly valid, just
and demandable claim, and it is just and equitable that attorney’s fees and
expenses of litigation should be recovered. Considering the lengthy pleadings, the
voluminous records, the lengthy and protracted trial, and the professional
standing of counsel, the Court hereby charges the defendants with the payment
of attorney’s fees in the amount of P15,000.00." (Record on Appeal, pp. 649-652.)
We are fully in accord with the foregoing view, which we adopt as ours.
WHEREFORE, the decision appealed from should be, as it is hereby, affirmed,
with costs against defendant-appellant, Philippine Advertising Corporation.
-Mika Ituriaga
G.R. No. 196419. October 4, 2017.*
PILIPINAS MAKRO, INC., petitioner, vs. COCO CHARCOAL PHILIPPINES, INC.
and LIM KIM SAN, respondents.
FACTS:
Pilipinas Makro, Inc. (Makro) and respondent COCO Charcoal Phils., Inc. (Coco
Charcoal) executed a notarized Deed of Absolute Sale6 wherein the latter would
sell its parcel of land, with a total area of 1,000 square meters and entered into
another notarized Deed of Absolute Sale with respondent Lim Kim San (Lim) for
the sale of the latter’s land, with a total area of 1,000 square meters and covered
by TCT No. 282650, for the same consideration of P8,500,000.00. Coco Charcoal
and Lim’s parcels of land are contiguous and parallel to each other. Aside from
the technical descriptions of the properties in question, both deeds of sale
contained identical provisions, similar terms, conditions, and warranties.
In December 1999, Makro engaged the services of a geodetic engineer to conduct
a resurvey and relocation of the two adjacent lots. As a result of the resurvey, it
was discovered that 131 square meters of the lot purchased from Coco Charcoal
had been encroached upon by the Department of Public Works and Highways
(DPWH) for its road widening project and construction of a drainage canal to
develop and expand the Davao-Cotabato National Highway. On the other hand,
130 square meters of the land bought from Lim had been encroached upon by the
same DPWH project.
Makro informed the representatives of Coco Charcoal and Lim about the
supposed encroachment on the parcels of land due to the DPWH project. Initially,
Makro offered a compromise agreement in consideration of a refund of 75% of
the value of the encroached portions. Thereafter, Makro sent a final demand
letter to collect the refund of the purchase price corresponding to the area
encroached upon by the road widening project, seeking to recover P1,113,500.00
from Coco Charcoal and P1,105,000.00 from Lim. Failing to recover such, Makro
filed separate complaints against Coco Charcoal and Lim to collect the refund
sought.
The RTC granted Makro’s complaint and ordered respondents to refund the
amount corresponding to the value of the encroached area. The RTC also found
respondents in bad faith because they had concealed from Makro the fact that the
DPWH had already taken possession of a portion of the lands they had sold,
respectively, considering that drainage pipes had already been installed prior to
the sale. Thus it also ordered respondents to pay attorney’s fees in the sum of
P200,000.00 and exemplary damages of P200,000.00 to deter anybody similarly
inclined.
CA reversed the RTC. It ruled that Makro was not entitled to a refund. It explained
that the warranty expressed in Section 4(i)11 of the deeds of sale is similar to the
warranty against eviction set forth under Article 1548 of the Civil Code. As such,
the CA posited that only a buyer in good faith may sue to a breach of warranty
against eviction. It averred that Makro could not feign ignorance of the ongoing
road widening project.
ISSUES:
I. Whether or not the CA erred in denying Makro refund on the ground of bad
faith.
II. Whether or not Makro is entitled to exemplary damages. (relevant)
RULING:
I.
Yes, the CA erred in ruling that Makro was in bad faith and not entitled to refund.
In addressing the issues of the present case, the following provisions of the deeds
of sale between Makro and respondents are pertinent:
Section 2. General Investigation and Relocation.— xxx Should there be any
discrepancy between the actual areas of the lots as re surveyed and the areas as
indicated in their Transfer Certificates of Title, the Purchase Price shall be
adjusted correspondingly at the rate of P8,500.000 per square meter. In the event
that the actual area of a lot is found to be in excess of the area specified in the
Titles, the Purchase Price shall be increased on the basis of the rate specified
herein. Conversely, in the event that the actual area of a lot is found to be less
than the area specified in the Titles, the BUYER shall deduct a portion of the
Purchase Price corresponding to the deficiency in the area on the basis of
the rate specified herein.
Section 4. Representations and Warranties.— The SELLER hereby represents and
warrants to the Buyer that:
i. The Property is and shall continue to be free and clear of all easements, liens
and encumbrances of any nature whatsoever, and is, and shall continue to be, not
subject to any claim set-off or defense which will prevent the BUYER from
obtaining full and absolute ownership and possession over the Property or from
developing or using it as a site for its store building.
The courts a quo agree that the DPWH project encroached upon the properties
Makro had purchased from respondents. Nevertheless, the CA opined that Makro
was not entitled to a refund because it had actual knowledge of the ongoing road
widening project. The appellate court likened Section 4(i) of the deeds of sale as
a warranty against eviction, which necessitates that the buyer be in good faith for
it to be enforced.
An express warranty pertains to any affirmation of fact or any promise by the
seller relating to the thing, the natural tendency of which is to induce the buyer
to purchase the same. It includes all warranties derived from the language of the
contract, so long as the language is express — it may take the form of an
affirmation, a promise or a representation. On the other hand, an implied
warranty is one which the law derives by application or inference from the nature
of transaction or the relative situation or circumstances of the parties,
irrespective of any intention of the seller to create it. In other words, an express
warranty is different from an implied warranty in that the former is found within
the very language of the contract while the latter is by operation of law. Thus, the
CA erred in treating Section 4(i) of the deeds of sale as akin to an implied
warranty against eviction.
Further, even if Section 4(i) of the deeds of sale was to be deemed similar to an
implied warranty against eviction, the CA erred in concluding that Makro acted
in bad faith.
It is undisputed that Makro’s legal counsel conducted an ocular inspection on the
properties in question before the execution of the deeds of sale and that there
were noticeable works and constructions going on near them. Nonetheless, these
are insufficient to charge Makro with actual knowledge that the DPWH project
had encroached upon respondents’ properties. The dimensions of the properties
in relation to the DPWH project could have not been accurately ascertained
through the naked eye.
II.
No, Makro is not entitled to exemplary damages.
Exemplary damages and attorney’s fees may be awarded only for cause provided
for by law.
In ABS-CBN Broadcasting Corporation v. Court of Appeals, the Court cautioned
that the fact that a party was compelled to litigate his cause does not necessarily
warrant the award of attorney’s fees, to wit:
As regards attorney’s fees, the law is clear that in the absence of stipulation,
attorney’s fees may be recovered as actual or compensatory damages under any
of the circumstances provided for in Article 2208 of the Civil Code. The general
rule is that attorney’s fees cannot be recovered as part of damages because of the
policy that no premium should be placed on the right to litigate. They are not to
be awarded every time a party wins a suit. The power of the court to award
attorney’s fees under Article 2208 demands factual, legal, and equitable
justification. Even when a claimant is compelled to litigate with third
persons or to incur expenses to protect his rights, still attorney’s fees may
not be awarded where no sufficient showing of bad faith could be reflected
in a party’s persistence in a case other than an erroneous conviction of the
righteousness of his cause. (Emphasis supplied)
Other than the bare fact that Makro was compelled to hire the services of counsel
to prosecute its case, the RTC did not provide compelling reasons to justify the
award of attorney’s fees. Thus, it is but right to delete the award especially since
there is no showing that respondents had acted in bad faith in refusing Makro’s
demand for refund.
On the other hand, exemplary damages may be awarded if the defendant had
acted in a wanton, fraudulent, reckless, oppressive or malevolent manner.
The RTC found the award of exemplary damages warranted because respondents
allegedly concealed the fact the DPWH had already taken possession of a portion
of the land they had sold to Makro. Bad faith, however, involves a state of mind
dominated by ill will or motive implying a conscious and intentional design to do
a wrongful act for a dishonest purpose or moral obliquity. Here, there is
insufficient evidence to definitively ascertain that respondents’ omission to
mention the ongoing DPWH projects was impelled by a conscious desire to
defraud Makro. This is especially true since the road widening project was
already in progress even before the time of the sale, and which would have been
noticeable when Makro conducted its ocular inspection.
WHEREFORE, the petition is GRANTED. The 30 December 2010 Decision and 7
April 2011 Resolution of the Court of Appeals in C.A.-G.R. CV No. 83836 are
REVERSED and SET ASIDE. Petitioner Pilipinas Makro, Inc. is entitled to recover
P1,113,500.00 from respondent Coco Charcoal Phils., Inc. and P1,105,000.00
from respondent Lim Kim San. SO ORDERED.
B. Requirements To Award Exemplary Damages
ERLINDA FRANCISCO, doing business in the name and style of Cebu
Fountainhead Bakeshop and JULIANA PAMAONG, petitioners, vs. RICARDO
FERRER, JR., ANNETTE FERRER, ERNESTO LO AND REBECCA LO,
respondents.
G.R. No. 142029 February 28, 2001
FACTS: On November 19, 1992 Mrs. Rebecca Lo and her daughter Annette Ferrer
ordered a three-layered cake from Fountainhead Bakeshop, Mango Avenue
Branch. It was then agreed that the wedding cake shall be delivered at 5:00
o'clock in the afternoon at the Cebu Country Club, Cebu City, stating clearly that
the wedding is scheduled on December 14, 1992.
On the day of the wedding, December 14, 1992, respondents arrived at the Cebu
Country Club around 6:00 o'clock in the evening. They immediately notice the
absence of the wedding cake. At 7:00 o'clock in the evening they made a follow-
up call to Fountainhead Bakeshop and was informed that it was probably late
because of the traffic. At 8:00 o'clock they were informed that no wedding cake
will be delivered because the order slip got lost. Respondents were then
compelled to buy the only available cake at the Cebu Country Club which was a
sans rival. Even though they felt that it was a poor substitute to a wedding cake,
the cutting of the cake is always a part of the ceremony. At 10:00 o'clock in the
evening, the wedding cake arrived but the respondents declined to accept it,
besides their order was a three-layered cake and what was actually delivered was
a two-layered one.
Subsequently, Erlinda Francisco sent a letter of apology accompanied with a
P5,000.00 check, however, the same was declined by respondents because they
felt it was inadequate. Two weeks after the wedding, Francisco called Mrs.
Rebecca Lo and apologized.
On March 12, 1993, respondents filed with the Regional Trial Court, Cebu City an
action for breach of contract with damages against petitioners.
The trial court rendered a decision in favor of respondents. The Court of Appeals
increased the trial court's award of moral damages to P250,000 and awarding
exemplary damages in the amount of P100,000, in addition to the cost of the
wedding cake in the amount of P3,175.00; Attorney's fees in the amount of
P10,000.00; and Cost of litigation.
ISSUES:
1. W/N the CA erred in affirming the trial court's award of moral
damages and increasing the amount from P30,000 to P250,000
2. W/N the CA was justified in awarding exemplary damages of
P100,000.00
RULING:
1. YES.
To recover moral damages in an action for breach of contract, the breach must be
palpably wanton, reckless, malicious, in bad faith, oppressive or abusive. Under
the provisions of this law, in culpa contractual or breach of contract, moral
damages may be recovered when the defendant acted in bad faith or was guilty
of gross negligence (amounting to bad faith) or in wanton disregard of his
contractual obligation and, exceptionally, when the act of breach of contract itself
is constitutive of tort resulting in physical injuries. Moral damages may be
awarded in breaches of contracts where the defendant acted fraudulently or in
bad faith. Bad faith does not simply connote bad judgment or negligence, it
imports a dishonest purpose or some moral obliquity and conscious doing of a
wrong, a breach of known duty through some motive or interest or ill will that
partakes of the nature of fraud.
In this case, we find no such fraud or bad faith. Moral damages are in the category
of an award designed to compensate the claimant for actual injury suffered and
not to impose a penalty on the wrongdoer. The person claiming moral damages
must prove the existence of bad faith by clear and convincing evidence for the
law always presumes good faith. It is not enough that one merely suffered
sleepless nights, mental anguish, serious anxiety as the result of the actuations of
the other party. Invariably such action must be shown to have been willfully done
in bad faith or will ill motive. Mere allegations of besmirched reputation,
embarrassment and sleepless nights are insufficient to warrant an award for
moral damages. It must be shown that the proximate cause thereof was the
unlawful act or omission.
An award of moral damages would require certain conditions to be met, to wit:
(1) There must be an injury, whether physical, mental or
psychological, clearly sustained by the claimant;
(2) There must be culpable act or omission factually
established;
(3) The wrongful act or omission of the defendant is the
proximate cause of the injury sustained by the claimant; and
(4) The award of damages is predicated on any of the cases
stated in Article 2219 of the Civil Code.
It must again be stressed that moral damages are emphatically not intended to
enrich a plaintiff at the expense of the defendant. When awarded, moral damages
must not be palpably and scandalously excessive as to indicate that it was the
result of passion, prejudice or corruption on the part of the trial court judge or
appellate court justices.
2. NO.
To warrant the award of exemplary damages, the wrongful act must be
accompanied by bad faith, and an award of damages would be allowed only if the
guilty party acted in a wanton, fraudulent, reckless or malevolent manner.
The requirements of an award of exemplary damages are:
(1) they may be imposed by way of example in addition to
compensatory damages, and only after the claimant's right to them
has been established;
(2) that they cannot be recovered as a matter of right, their
determination depending upon the amount of compensatory
damages that may be awarded to the claimant;
(3) the act must be accompanied by bad faith or done in a wanton,
fraudulent, oppressive or malevolent manner.
Nevertheless, the facts show that when confronted with their failure to deliver on
the wedding day the wedding cake ordered and paid for, petitioners gave the
lame excuse that delivery was probably delayed because of the traffic, when in
truth, no cake could be delivered because the order slip got lost. For such
prevarication, petitioners must be held liable for nominal damages for
insensitivity, inadvertence or inattention to their customer's anxiety and need of
the hour.
Nominal damages are recoverable where a legal right is technically violated and
must be vindicated against an invasion that has produced no actual present loss
of any kind or where there has been a breach of contract and no substantial injury
or actual damages whatsoever have been or can be shown. Nominal damages may
be awarded to a plaintiff whose right has been violated or invaded by the
defendant, for the purpose of vindicating or recognizing that right, not for
indemnifying the plaintiff for any loss suffered.
DISPOSITIVE PORTION:
WHEREFORE, the Court GRANTS the petition. The Court REVERSES the decision
of the Court of Appeals in CA-G. R. CV No. 50894, and in lieu thereof, sentences
petitioners to pay respondents, as follows:
1. The cost of the wedding cake in the amount of P3,175.00;
2. Nominal damages in the amount of P10,000.00;
3. Attorney's fees in the amount of P10,000.00; and
4. Costs of litigation.
No costs in this instance.
C. WHEN RECOVERED
1. IN CRIMINAL OFFENSES
ALFONSO D. GAVIOLA, Petitioner, vs. PEOPLE OF THE PHILIPPINES,
Respondent.
FACTS
Elias Gaviola filed a complaint against Eusebio Mejarito in the then Court of
First Instance of Carigara, Leyte, for quieting of title with a plea for injunctive
relief. The suit involved a 40,500-square-meter parcel of coconut land located in
Barrio Calbani, Maripipi, Leyte, identified as Cadastral Lot 1301 and covered by
Tax Declaration (TD) No. 743.3 The case was docketed as Civil Case No. 111.
Eusebio, for his part, claimed ownership over the property.
On July 29, 1955, the trial court ordered the dismissal of the complaint and
declared Eusebio the lawful owner of the property
The decision became final and executory. On September 3, 1955, the trial court
ordered the sheriff to place Eusebio in possession of the property.5 The sheriff
complied with the order on December 19, 1958.6
In the meantime, Eusebio died intestate and was survived by his son, Cleto. Elias
Gaviola also died intestate and was survived by his son, Alfonso.
Almost 30 years thereafter, on October 1985, Cleto filed a complaint against
Alfonso and four others for recovery of possession of a parcel of land and
execution of judgment in Civil Case No. 111. The property involved was located
on the north of Lot 1301 and covered by TD No. 1546
On May 4, 1990, the court rendered judgment in favor of the defendants in Civil
Case No. B-0600 and ordered the complaint dismissed. The court ruled that the
parcels of land occupied by the defendants, inclusive of Lot 1311, were different
from the property adjudicated to Eusebio Mejarito in Civil Case No. 111, which
is actually Lot 1301. The court also ruled that the plaintiff had no cause of action
for the execution of the court’s decision in Civil Case No. 111 because such
decision had long been enforced, per report of the sheriff. 10
Eusebio appealed the decision to the CA which rendered judgment on
September 18, 1992, affirming the decision of the RTC.11 The appellate court
declared that the house of Alfonso Gaviola was located in Lot 1311 covered by
TD 1611 under the name of Elias Gaviola. Cleto filed a petition for review on
certiorari with this Court, which was denied due course in a Resolution12 dated
March 24, 1993. Thus, the CA decision became final and executory. The trial
court issued a writ of execution, a copy of which Sheriff Ludenilo S. Ador served
on the defendants on August 5, 1993.13
In the meantime, Cleto Mejarito left the Philippines and stayed in the United
States of America. He entrusted the land to the care of his nephew, Rafael
Lozano.
At 7:00 a.m. on September 6, 1997, Jovencio Mejarito, a nephew of Cleto
Mejarito, and a barangay councilman, saw Gavino Gaviola, Rodrigo Gaviola and
Domingo Caingcoy climbing the coconut trees in Lot 1301. Under the
supervision of the spouses Alfonso and Leticia Gaviola, they
gathered 1,500 coconuts worth P3,000.00 from the coconut trees.14 The Officer-
in-Charge of the Maripipi Police Station then filed a criminal complaint for
qualified theft against the spouses Gaviola and those who gathered the coconuts
in the municipal trial court.15 In the meantime, the coconuts were entrusted to
the care of the barangay captain.
On February 6, 1998, an Information was filed with the RTC of Naval, Biliran,
against the spouses Alfonso and Leticia Gaviola for qualified theft.
RTC rendered judgment convicting Alfonso of qualified theft.
ISSUE
Whether Petitioner is liable for exemplary and liquidated damages.
HELD
According to Article 310 of the Revised Penal Code, theft is qualified if coconuts
are taken from the premises of a plantation:
Art. 310. Qualified theft. – The crime of theft shall be punished by the penalties
next higher by two degrees than those respectively specified in the next
preceding article, if committed by a domestic servant, or with grave abuse of
confidence, or if the property stolen is motor vehicle, mail matter or large cattle
or consists of coconuts taken from the premises of a plantation, fish taken from
a fishpond or fishery or if property is taken on the occasion of fire, earthquake,
typhoon, volcanic eruption, or any other calamity, vehicular accident or civil
disturbance.
For one to be guilty of theft, the accused must have an intent to steal (animus
furandi) personal property, meaning the intent to deprive another of his
ownership/lawful possession of personal property which intent is apart from,
but concurrent with the general criminal intent which is an essential element of
a felony of dolo (dolos malus). The animo being a state of the mind may be
proved by direct or circumstantial evidence, inclusive of the manner and
conduct of the accused before, during and after the taking of the personal
property. General criminal intent is presumed or inferred from the very fact that
the wrongful act is done since one is presumed to have willed the natural
consequences of his own acts. Likewise, animus furandi is presumed from the
taking of personal property without the consent of the owner or lawful
possessor thereof. The same may be rebutted by the accused by evidence that
he took the personal property under a bona fide belief that he owns the
property.
The findings of the RTC were affirmed by the appellate court. The well-
entrenched rule is that the findings of facts of the trial court, affirmed by the
appellate court, are conclusive on this Court, absent any evidence that the trial
court and the appellate court ignored, misconstrued, or misinterpreted cogent
facts and circumstances of substance which, if considered, would warrant a
modification or reversal of the outcome of the case. We have reviewed the
records and find no justification to modify, much less reverse, the findings of the
trial and appellate courts.
The petitioner cannot feign ignorance or even unfamiliarity with the location,
identity and the metes and bounds of the private complainant’s property, Lot
1301, vis-à-vis that of his own, Lot 1311.
Indeed, that the lands of plaintiff, of Elias Gaviola (father of defendant Alfonso),
and of defendant Segundo Gaviola (now, but Hermenegildo Gaviola before) are
separate and distinct from each other is shown by the fact that they have been
covered by different sets of tax declarations since as early as 1906. It should be
noted that the tax declarations that cover each land do not merge with, overlap,
or cancel, each other. There appear apparent minor discrepancies but they can
easily be explained by two events: the sale of a portion of the land of Isabela
Mejarito to Elias Gaviola and the decision in Civil Case No. 111. If these two
events are considered, these apparent discrepancies vanish into thin air.
Finally, that these three parcels of lands are separate and distinct from each
other is confirmed by the cadastral survey where the lands of plaintiff, of Elias
Gaviola and of Segundo Gaviola, are denominated as Cadastral Lot Nos. 1301,
1311 and 1303, respectively. Not only that, their definite locations and
boundaries are even delineated in the sketch prepared by the court-appointed
commissioner, which sketch is now marked as Exhs. "H" and series, of plaintiff.
Also, the report to which the sketch is attached even states that the house of
defendant Alfonso Gaviola is located on the land of Elias Gaviola; and while said
report enumerates the houses located on the land of plaintiff, neither the house
of defendant Alfonso Gaviola nor of defendant Segundo Gaviola nor of the other
defendants are among those mentioned therein.
We rule that there is factual and legal bases for the award of P20,000.00
by way of exemplary damages. Under Article 223031 of the New Civil
Code, exemplary damages may be awarded when the crime was
committed with one or more aggravating circumstances. In this case, the
petitioner is guilty not only of simple theft but of qualified theft.
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. CLAUDIO TEEHANKEE,
JR., accused-appellant.
G.R. Nos. 111206-08, SECOND DIVISION, October 6, 1995, PUNO, J.
Three (3) separate Informations were filed against accused Claudio Teehankee,
Jr. for the shooting of Roland John Chapman, Jussi Olavi Leino and Maureen
Hultman. Initially, he was charged with: MURDER for the killing of ROLAND
CHAPMAN, and two (2) FRUSTRATED MURDER for the shooting and wounding
of JUSSI LEINO and MAUREEN HULTMAN. When Hultman died on October 17,
1991, during the course of the trial, the Information for Frustrated Murder
against accused was amended to MURDER.
The Information for murder in Criminal Case No. 91-4605 thus reads:
That on or about the 13th day of July, 1991, in the Municipality
of Makati, Metro Manila, Philippines and within the jurisdiction
of this Honorable Court, the said Claudio Teehankee, Jr. y Javier,
armed with a handgun, with intent to kill and evident
premeditation and by means of treachery, did then and there
wilfully, unlawfully and feloniously attack, assault and shoot
with and shoot with the said handgun Roland John Chapman
who war hit in the chest, thereby inflicting mortal wounds
which directly caused the death of said Roland John Chapman.
Contrary to law.
The Amended Information for Murder in Criminal Case No. 91-4606 reads:
That on or about the 13th day of July, 1991, in the Municipality
of Makati, Metro Manila, Philippines and within the jurisdiction
of this Honorable Court, the said Claudio Teehankee, Jr. y Javier,
armed with a handgun, with intent to kill and evident
premeditation, and by means of treachery, did then and there
wilfully, unlawfully and feloniously attack, assault and shoot
with the said handgun Maureen Navarro Hultman who was hit in
the head, thereby inflicting moral wounds which directly caused
the death of the said Maureen Hultman.
CONTRARY TO LAW.
Finally, the Information for Frustrated Murder in Criminal Case No. 91-4607
reads:
That on or about the 13th day of July, 1991, in the Municipality
of Makati, Metro Manila, Philippines and within the jurisdiction
of this Honorable Court, the above-named accused, while armed
with a handgun, with intent to kill, treachery and evident
premeditation did then and there wilfully, unlawfully and
feloniously attack, assault and shoot one Jussi Olavi Leino on the
head, thereby inflicting gunshot wounds, which ordinarily
would have caused the death of said Jussi Olavi Leino, thereby
performing all the acts of execution which would have produced
the crime of murder as a consequence, but nevertheless did not
produce it by reason of cause or causes independent of his will,
that is, due to the timely and able medical assistance rendered
to said Jussi Olavi Leino which prevented his death.
 Contrary to law.
Upon arraignment, accused pleaded not guilty to the three (3) charges. The
prosecution then started to adduce evidence relative to all three (3) cases. No
objection was made by the defense.
A replay of the facts will show that on July 12, 1991, Jussi Olavi Leino invited
Roland Chapman, Maureen Hultman and other friends for a party at his house in
Forbes Park, Makati. The party started at about 8:30 p.m. and ended at past
midnight. They then proceeded to Roxy's, a pub where students of International
School hang out. After an hour, they transferred to Vintage, another pub in
Makati, where they stayed until past 3:00 a.m. of July 13, 1991. Their group
returned to Roxy's to pick up a friend of Maureen, then went back to Leino's
house to eat.
After a while, Maureen requested Leino to take her home at Campanilla Street,
Dasmariñas Village, Makati. Chapman tagged along. When they entered the
village, Maureen asked Leino to stop along Mahogany Street, about a block away
from her house in Campanilla Street. She wanted to walk the rest of the way for
she did not like to create too much noise in going back to her house. She did not
want her parents to know that she was going home that late. Leino offered to walk
with her while Chapman stayed in the car and listened to the radio.
Leino and Maureen started walking on the sidewalk along Mahogany Street.
When they reached the corner of Caballero and Mahogany Streets, a light-colored
Mitsubishi box-type Lancer car, driven by accused Claudio Teehankee, Jr., came
up from behind them and stopped on the middle of the road. Accused alighted
from his car, approached them, and asked: "Who are you? (Show me your) I.D."
Leino thought accused only wanted to check their identities. He reached into his
pocket, took out his plastic wallet, and handed to accused his Asian Development
Bank (ADB) I.D. Accused did not bother to look at his I.D. as he just grabbed
Leino's wallet and pocketed it.
Chapman saw the incident. All of a sudden, he manifested from behind Leino and
inquired what was going on. He stepped down on the sidewalk and asked
accused: "Why are you bothering us?" Accused pushed Chapman, dug into his
shirt, pulled out a gun and fired at him. Chapman felt his upper body, staggered
for a moment, and asked: "Why did you shoot me?" Chapman crumpled on the
sidewalk. Leino knelt beside Chapman to assist him but accused ordered him to
get up and leave Chapman alone.
Accused then turned his ire on Leino. He pointed gun at him and asked: "Do you
want a trouble?" Leino said "no" and took a step backward. The shooting initially
shocked Maureen. When she came to her senses, she became hysterical and
started screaming for help. She repeatedly shouted: "Oh, my God, he's got a gun.
He's gonna kill us. Will somebody help us?"
All the while, accused was pointing his gun to and from Leino to Maureen,
warning the latter to shut up. Accused ordered Leino to sit down on the sidewalk.
Leino obeyed and made no attempt to move away. Accused stood 2-3 meters
away from him. He knew he could not run far without being shot by accused.
Maureen continued to be hysterical. She could not stay still. She strayed to the
side of accused's car. Accused tried but failed to grab her. Maureen circled around
accused's car, trying to put some distance between them. The short chase lasted
for a minute or two. Eventually, accused caught Maureen and repeatedly enjoined
her to shut up and sit down beside Leino.
Maureen finally sat beside Leino on the sidewalk. Two (2) meters away and
directly in front of them stood accused. For a moment, accused turned his back
from the two. He faced them again and shot Leino. Leino was hit on the upper jaw,
fell backwards on the sidewalk, but did not lose consciousness. Leino heard
another shot and saw Maureen fall beside him. He lifted his head to see what was
happening and saw accused return to his car and drive away.
On December 22, 1992, the trial court convicted accused CLAUDIO TEEHANKEE,
JR. of the crimes charged. The dispositive portion of the Decision reads:
WHEREFORE, premises considered, the Court hereby renders
judgment:
(1) In criminal Case No. 91-4605, finding accused Claudio J.
Teehankee, Jr., guilty beyond reasonable doubt of the offense of
Murder, qualified by treachery, for the fatal shooting of Roland
John Chapman, and sentencing said accused to suffer
imprisonment of Reclusion perpetua, and to pay the heirs of the
said deceased the sum of Fifty Thousand Pesos (P50, 000.00),
Philippine Currency, plus moderate or temperate and
exemplary damages in the sum of Five Hundred Thousand Pesos
(P500,000.00), Philippine Currency;
(2) In Criminal Case No. 91-4606, finding accused Claudio J. SO ORDERED.
Teehankee, Jr., guilty beyond reasonable doubt of the offense of
Murder, qualified by treachery, for the fatal shooting of Maureen ISSUE:
Navarro Hultman, and sentencing him to suffer imprisonment
of Reclusion Perpetua, and to pay the heirs of the said deceased Whether or not the accused is liable for moral and exemplary damages and loss
the sum of Fifty Thousand Pesos (P50,000.00), Philippine of earning capacity.(YES)
Currency, plus the sums of Two Million Three Hundred Fifty
Thousand Four Hundred Sixty-One Pesos and Eighty-Three RULING:
Centavos (P2,350,461.83), Philippine Currency, as actual
Appellant posits that the awards of moral and exemplary damages and for loss of
damages; Thirteen Million Pesos (P13,000,000.00), Philippine
earning capacity of Maureen Hultman, Roland Chapman and Jussi Leino were
Currency, for loss of earning capacity of the said deceased; and
exorbitant. He likewise claims that the trial court's award of attorney's fees was
One Million Pesos (P1,000,000.00), Philippine Currency, as
excessive.
moral, moderate and exemplary damages;
The early case of Heirs of Raymundo Castro v. Bustos discussed in detail the
(3) In Criminal Case No. 91-4607, finding accused Claudio J.
matter of damages recoverable in case of death arising from a felony, thus:
Teehankee, Jr., guilty beyond reasonable doubt of the offense of
Frustrated Murder, qualified by treachery, for the shooting of
When the commission of a crime results in death, the civil
Jussi Olavi Leino, and sentencing him to suffer the
obligations arising therefrom are governed by penal laws, ". . .
indeterminate penalty of eight (8) years of prision mayor, as
subject to the provisions of Art. 2177, and of the pertinent
minimum, to ten (10) years and one (1) day of prision mayor, as
provisions of Chapter 2, Preliminary Title on Human Relations,
maximum, and to pay the said offended party the sum of Thirty
and of Title XVIII of this Book (Book IV) regulating damages."
Thousand Pesos (P30,000.00), Philippine Currency; plus the
(Art. 1161, Civil Code)
sum of One Hundred Eighteen Thousand Three Hundred Sixty-
Nine Pesos and Eighty-Four Centavos (P118,369.84), Philippine Thus, "every person criminally liable for a felony is also civilly
Currency, and another sum equivalent in Philippine Pesos of U.S. liable." (Art. 100, Revised Penal Code). This civil liability, in case
$55,600.00, both as actual damages; an amount equivalent in the felony involves death, includes indemnification for
Philippine Pesos of U.S. $40,000.00, as loss of earning capacity consequential damages (Art. 104, id.) and said consequential
of said offended party; and One Million Pesos (P1,000,000.00), damages in turn include ". . . those suffered by his family or by a
Philippine Currency, as moral, moderate and exemplary third person by reason of the crime." (Art. 107, id.) Since these
damages. provisions are subject, however, as above indicated, to certain
provisions of the Civil Code, (w)e will now turn to said
(4) In all these three cases ordering said accused to pay all the
provisions.
offended parties the sum of Three Million Pesos
(P3,000,000.00), Philippine Currency, as and for attorney's fees The general rule in the Civil Code is that:
and expenses of litigation; and
In crimes and quasi-delicts, the defendant shall
(5) To pay the costs in these three cases. be liable for all damages which are the natural
and probable consequences of the act or
Consequently the petition for bail is hereby denied for utter lack
omission complained of. It is not necessary
of merit.
that such damages have been foreseen or could
 have reasonably foreseen by the defendant.
(Art. 2202)
When, however, the crime committed involves death, there is
Art. 2206 which provides thus:
The amount of damages for death caused by a
crime or quasi-delict shall be at least three
thousand pesos even though there may have
been mitigating circumstances. In addition:
(1) The defendant shall be liable for the loss of
the earning capacity of the deceased, and the
indemnity shall be paid to the heirs of the
latter; such indemnity shall in every case be
assessed and awarded by the court, unless the
deceased on account of permanent physical
disability not caused by the defendant, had no
earning capacity at the time of his death;
(2) If the deceased was obliged to give support
according to the provisions of article 291, the
recipient who is not an heir called to the
descendant's inheritance by law of testate or
intestate succession, may demand support
from the person causing the death, for a period
not exceeding five years, the exact duration to
be fixed by the court;
(3) The spouse, legitimate or illegitimate
descendants and ascendants of the deceased
may demand moral damages for mental
anguish by reason of the death of the deceased.
The amount of P3,000 referred to in the above article has
already been increased by this Court first, to P6,000.00 in People
v. Amansec, 80 Phil. 426, and lately to P12,000.00 in the case of
People v. Pantoja, G.R. No. L-18793, promulgated October 11,
1968 190, and it must be stressed that this amount, as well as the
amount of moral damages, may be adjudicated even without
proof of pecuniary loss, the assessment of the moral damages
being "left to the discretion of the court, according to the
circumstances of each case." (Art. 2216)
Exemplary damages may also be imposed as a part of this civil
liability when the crime has been committed with one or more
aggravating circumstances, such damages being "separate and
distinct from fines and shall be paid to the offended party." (Art.
2230). Exemplary damages cannot however be recovered as a
matter of right; the court will decide whether or not they should
be given. (Art. 2233)
In any event, save as expressly provided in connection with the
indemnity for the sole fact of death (1st par., Art. 2206) and is
cases wherein exemplary damages are awarded precisely
because of the attendance of aggravating circumstances, (Art.
2230) ". . . damages to be adjudicated may be respectively
increased or lessened according to the aggravating or mitigating
circumstances," (Art. 2204) "but the party suffering the loss or
injury must exercise the diligence of a good father of a family to
minimize the damages resulting from the act or omission in
question." (Art. 2203) "Interest as a part of the damages, may, in
a proper case, be adjudicated in the discretion of the Court."
(Art. 2211) As to attorneys' fees and expenses of litigation, the
same may be recovered only when exemplary damages have
been granted (Art. 2208, par. 1) or . . . when there is a separate
civil action.
Stated differently, when death occurs as a result of a crime, the
heirs of the deceased are entitled to the following items of
damages:
1. As indemnity for the death of the victim of
the offense — P12,000.00 (now P50,000.00),
without the need of any evidence or proof of
damages, and even though there may have
been mitigating circumstances attending the
commission of the offense.
2. As indemnity for loss of earning capacity of
the deceased — an amount to be fixed by the
court according to the circumstances of the
deceased related to his actual income at the
time of death and his probable life expectancy,
the said indemnity to be assessed and awarded
by the court as a matter of duty, unless the
deceased had no earning capacity at said time
on account of permanent disability not caused
by the accused. If the deceased was obliged to
give support, under Art. 291, Civil Code, the
recipient who is not an heir, may demand
support from the accused for not more than
five years, the exact duration to be fixed by the
court.
3. As moral damages for mental anguish, — an
amount to be fixed by the court. This may be
recovered even by the illegitimate descendants
and ascendants of the deceased.
4. As exemplary damages, when the crime is
attended by one or more aggravating
circumstances, — an amount to be fixed in the
discretion of the court, the same to be
considered separate from fines.
5. As attorney's fees and expenses of litigation,
— the actual amount thereof, (but only when a
separate civil action to recover civil liability
has been filed or when exemplary damages are
awarded).
6. Interests in the proper cases.
7. It must be emphasized that the indemnities
for loss of earning capacity of the deceased and
for moral damages are recoverable separately
from and in addition to the fixed sum of
P12,000.00 (now P50,000.00) corresponding
to the indemnity for the sole fact of death, and
that these damages may, however, be
respectively increased or lessened according
to the mitigating or aggravating circumstances,
except items 1 and 4 above, for obvious
reasons.
We shall first review the damages awarded to the heirs of ROLAND JOHN
CHAPMAN in light of the law and the case law.
Appellant claims that the award of Five Hundred Thousand (P500,000.00) pesos
as moderate or temperate and exemplary damages to the heirs of Roland John
Chapman was baseless.
We start with the observation that the trial court should not have lumped
together the awards for moderate or temperate and exemplary damages at Five
Hundred Thousand Pesos (P500,000.00), without specifying the particular
amount which corresponds to each, as they are of a different kind. We shall,
however, consider their propriety and reasonableness.
The amount of Five Hundred Thousand (P500,000.00) pesos cannot be given as
temperate or moderate damages for the records do not show any basis for
sustaining the award. Nor can it be given as exemplary damages. The killing of
Chapman was not attended by either evident premeditation or treachery. Be that
as it may, the award can be considered as one for moral damages under Article
2206 (3) of the New Civil Code. It states:
Art. 2206. The amount of damages for death caused by a crime .
. . shall be at least (fifty thousand pesos, under current
jurisprudence) . . . In addition:
xxx xxx xxx
(3) The spouse, legitimate or illegitimate descendants and
ascendants of the deceased may demand moral damages for
mental anguish by reason of the death of the deceased.
Moreover, considering the shocking and senseless aggression committed by
appellant, we increase the amount of moral damages to One Million
(P1,000,000.00) pesos for the death of Chapman.
We next rule on the legality of damages awarded to the heirs of MAUREEN
NAVARRO HULTMAN.
Appellant argues that the damages for the death of Maureen should be awarded
to her mother, Vivian Hultman, and her natural father. He contends that under
Article 352 of the New Civil Code, Anders Hultman as adoptive father of Maureen,
is not entitled to said award. Only the parents by nature of Maureen should
inherit from her.
We reject the argument. Under the Family Code which was already in effect at the
time of Maureen's death, Anders Hultman, as adoptive father, is entitled to the
award made by the trial court. Article 190 of the Family Code provides:
xxx xxx xxx
(2) When the parents, legitimate or illegitimate, or the
legitimate descendants of the adopted concur with the adopters,
they shall divide the entire estate, one-half to be inherited by the
parents or ascendants and the other half, by the adopters;
xxx xxx xxx
(5) When only the adopters survive, they shall inherit the entire
estate;
It does not appear on the records whether Maureen was survived by her natural
father. During the trial of these cases, only Vivian and Anders Hultman testified
on their claim of damages. Hence, we find that the award of damages in their favor
has sufficient factual and legal basis.
Appellant also urges that the award to the heirs of Maureen Hultman of One
Million Pesos (P1,000,000.00) as moral and exemplary damages is unjustified or,
at the very least, exorbitant and should be reduced.
We hold that the award of One Million (P1,000,000.00) pesos is amply justified
by the circumstances. The records reveal that Maureen recovered between life
and death for ninety-seven (97) days. Her family experienced the peaks and
valleys of unspeakable suffering. During that time, she underwent brain surgery
three (3) times. Her condition was never stable and remained critical. It was
always touch and go with death. She could not be left alone at the hospital. Her
parents had to be perpetually by her side at least six (6) to seven (7) hours daily.
After the shooting, their siblings had to be sent back to Sweden for their safety.
Left unattended, her family's business took a downspin. Soon, her family's assets
were depleted, then wiped out. A total of twenty-three (23) doctors attended to
her and their bills ballooned without abatement. They were forced to rely on the
goodness of the gracious. Her family started receiving contributions from other
people to defray the medical expenses and hospital bills. Maureen never regained
consciousness until her demise on October 17, 1991, at the tender age of
seventeen. Under the foregoing circumstances, we thus find the award of One
Million Pesos (P1,000,000.00) as moral damages to be reasonable.
Moreover, we find that the grant of exemplary damages is called for by the
circumstances of the case. Under Article 2229 of the Civil Code, in addition to the
award of moral damages, exemplary or corrective damages may be adjudged in
order to deter the commission of similar acts in the future. The award for
exemplary damages is designed to permit the courts to mould behavior that has
socially deleterious consequences. Its imposition is required by public policy to
suppress the wanton acts of an offender.
In the case at bar, appellant's unprovoked aggression snuffed the life of Maureen
Hultman, a girl in the prime of her youth. Hultman and her companions were
gunned down by appellant in cold-blood, for no apparent reason. Appellant's
vicious criminality led to the suffering of his victims and their families.
Considering our soaring crime rate, the imposition of exemplary damages against
appellant to deter others from taking the lives of people without any sense of sin
is proper. Moreover, since the killing of Hultman was attended by treachery and
pursuant to Article 2229 of the new Civil Code, 195 we impose an award of Two
Million (P2,000,000.00) pesos as exemplary damages against appellant for the
death of Maureen Hultman.
We now review the award of One Million Pesos (P1,000,000.00) as moral,
moderate and exemplary damages to victim JUSSI LEINO.
From the record, it is incontrovertible that Leino likewise suffered extensive
injuries as a result of the shooting. His upper jaw bone was shattered. He would
need a bone transplant operation to restore it. His tongue was also injured. He
partially lost his sense of taste for his taste buds were also affected. When he was
discharged from the hospital, he had difficulty in speaking and had to be fed
through a tube running down his nose. He lost eight of his teeth. The roots of his
teeth were cut off and the raw nerves were exposed. But all these speak only of
his physical injuries and suffering. More devastating was the emotional strain
that distressed Leino. His parents were in Europe for a vacation at the time of the
shooting. Only a neighbor attended to him at the hospital. It took two (2) days for
his father to come and comfort by his bedside. Leino had trouble sleeping in peace
at night. The traumatic event woke him up in the middle of the night. Black
memories of the incident kept coming back to mind. Understably, the ill-effects
of the incident spilled over his family. Seppo Leino, Jussi's father, was tortured by
thoughts of insecurity. He had to relocate his entire family to Europe where he
felt they would be safe. Under the foregoing circumstances, we find that an award
of One Million (P1,000,000.00) pesos to Jussi Leino as indemnity for moral
damages is justified and reasonable.
As in the case of Hultman, since the shooting of Leino was committed with
treachery and pursuant to Article 2229 of the New Civil Code, appellant is
additionally adjudged liable for the payment to Leino of Two Million
(P2,000,000.00) pesos as exemplary damages.
We come now to the trial court's monetary award to compensate the LOSS OF
EARNING CAPACITY OF VICTIMS JUSSI LEINO and MAUREEN HULTMAN.
To be compensated for loss of earning capacity, it is not necessary that the victim,
at the time of injury or death, is gainfully employed. Compensation of this nature
is awarded not for loss of earnings but for loss of capacity to earn money. In
Cariaga v. Laguna Tayabas Bus Company, we awarded to the heirs of Cariaga a
sum representing loss of his earning capacity although he was still a medical
student at the time of injury. However, the award was not without basis for
Cariaga was then a fourth year medical student at a reputable school; his
scholastic record, which was presented at the trial, justified an assumption that
he would have been able to finish his course and pass the board in due time; and
a doctor, presented as witness for the appellee, testified as to the amount of
income Cariaga would have earned had he finished his medical studies.
In the case at bar, the trial court awarded the amount, equivalent in Philippine
pesos, of Forty capacity of JUSSI LEINO. We agree with appellant that this amount
is highly speculative and should be denied considering that Leino had only
earned a high school degree at the International School, Manila, in 1989. He went
back to Finland to serve the military and has just arrived in Manila in February
1991 to pursue his ambition to become a pilot. At the time of the shooting on July
13, 1991, he has just enrolled at the Manila Aero Club to become a professional
pilot. He was thus only on his first year, first semester, in said school and was
practically, a mere high school graduate. Under the foregoing circumstances, we
find the records wanting with substantial evidence to justify a reasonable
assumption that Leino would have been able to finish his studies at the Manila
Aero Club and ultimately become a professional pilot.
We now pass upon the propriety of the award of Thirteen Million Pesos
(P13,000,000.00) for loss of earning capacity of deceased MAUREEN HULTMAN.
We find that the award is not supported by the records.
In adjudging an award for Maureen's loss of earning capacity, the trial court
incorrectly used the monthly salary of a secretary working in Sweden, computed
at two thousand dollars ($2,000.00) a month, as per the estimate given by Anders
Hultman. Nowhere in the records does it appear that, at the time of her death,
Maureen had acquired the skills needed for a secretarial job or that she intended
to take a secretarial course in preparation for such job in Sweden.
Clearly, there is no factual basis for the award of thirteen million
(P13,000,000.00) pesos to the heirs of Maureen far loss of earning capacity as a
probable secretary in Sweden.
In any event, what was proved on record is that after graduating from high school,
Maureen took up a short personality development course at the John Roberts
Powers. Maureen was employed at the John Roberts Powers at the time of her
death. It was her first job. In fact, she had just received her first salary, for which
reason she went out with her friends to celebrate on that fateful day. However,
neither the nature of her work nor her salary in said company was disclosed at
the trial. Thus, to compute the award for Maureen's loss of earning capacity, we
are constrained to use the minimum wage prevailing as of the date of her death
(October 17, 1991), i.e., one hundred eighteen pesos (P118.00). Allowing for
reasonable and necessary expenses in the amount of P19,800.00, her net income
per annum would amount to P26,859.17. Hence, using the formula repeatedly
adopted by this Court: (2/3 x [80 — age of victim at time of death]) x a reasonable
portion of the net income which would have been received by the heirs as
support, we fix the award for loss of earning as capacity of deceased Maureen
Hultman at Five Hundred Sixty-Four Thousand Forty-Two Pesos and Fifty-Seven
Centavos (P564,042.57).
It also bears emphasis that in the computation of the award for loss of earning
capacity of the deceased, the life expectancy of the deceased's heirs is not factored
in. The rule is well-settled that the award of damages for death is computed on
the basis of the life expectancy of the deceased, and not the beneficiary.
Lastly, appellant seeks a reduction of the award of attorney's fees in the amount
of Three Million Pesos (P3,000,000.00), claiming that the same is exorbitant.
We disagree. The three (3) private complainants were represented by the ACCRA
law firm, with Atty. Rogelio Vinluan as lead counsel. They agreed to pay the
amount of One Million (P1,000,000.00) pesos each as attorney's fees and for
litigation expenses. The three criminal cases were consolidated. A continuous
trial was conducted, with some hearings having both morning and afternoon
sessions. The trial lasted for almost one and a half years. More than forty (40)
witnesses testified during the hearings. Several pleadings were prepared and
filed. A total of sixty-eight (68) documentary exhibits were presented by the
prosecution. Incidents related to the trial of the cases came up to this Court for
review at least twice during the pendency of the trial. Given these circumstances
and the evident effort exerted by the private prosecutor throughout the trial, the
trial court's award of a total of Three Million (P3,000,000.00) pesos as attorney's
fees and litigation expenses appears just and reasonable.
IN VIEW WHEREOF, we hereby AFFIRM WITH MODIFICATIONS the Decision of
the trial court, dated December 22, 1992, thus:
(1) In Criminal Case No. 91-4605, finding accused Claudio J.
Teehankee, Jr., guilty beyond reasonable doubt of the crime of
Homicide for the shooting of Roland John Chapman, and
sentencing said accused to suffer an indeterminate penalty of
imprisonment of eight (8) years and one (1) day of prision
mayor as minimum to fourteen (14) years, eight (8) months and
one (1) day of reclusion temporal as maximum, and to pay the
heirs of the said deceased the following amounts: Fifty
Thousand (P50,000.00) pesos as indemnity for the victim's
death; and, One Million (P1,000,000.00) pesos as moral
damages.
(2) In Criminal Case No. 91-4606, finding accused Claudio J.
Teehankee, Jr., guilty beyond reasonable doubt of the crime of
Murder, qualified by treachery, for the shooting of Maureen
Navarro Hultman, and sentencing him to suffer imprisonment
of reclusion perpetua, and to pay the heirs of the said deceased
the following amounts: Fifty Thousand (P50,000.00) pesos as
indemnity for her death; Two Million Three Hundred Fifty
Thousand Four Hundred Sixty-One Pesos and Eighty-Three
Centavos (P2,350,461.83) as actual damages; Five Hundred
Sixty-Four Thousand Fourty-Two Pesos and Fifty-Seven
Centavos (P564,042.57) for loss of earning capacity of said
deceased; One Million Pesos (P1,000,000.00) as moral damages;
and Two Million (P2,000,000.00) pesos as exemplary damages.
(3) In Criminal Case No. 91-4807, finding accused Claudio J.
Teehankee, Jr., guilty beyond reasonable doubt of the crime of
Frustrated Murder, qualified by treachery, for the shooting of
Jussi Olavi Leino, and sentencing him to suffer the
indeterminate penalty of eight (8) years of prision mayor as
minimum, to fourteen (14) years and eight (8) months of
reclusion temporal as maximum, and to pay the said offended
party the following amounts: (P30,000.00) pesos as Thirty
Thousand (P30,000.00) pesos as indemnity for his injuries; One
Hundred Eighteen Thousand Three Hundred Sixty-Nine pesos
and Eighty-Four Centavos (P118,369.84) and equivalent in
Philippine Pesos of U.S.$55,600.00, both as actual damages; One
Million (P1,000,000.00) pesos as moral damages; and, Two
Million (P2,000,000.00) pesos as exemplary damages.
(4) In all three cases, ordering said accused to pay each of the
three (3) offended parties the sum of One Million Pesos
(P1,000,000.00; or a total of Three Million [P3,000,000.00]
pesos] for attorney's fees and expenses of litigation; and
(5) To pay the costs in all three (3) cases.
PEOPLE OF THE PHILIPPINES, PLAINTIFF-APPELLEE, VS. ROGELIO
CRISTOBAL, ACCUSED-APPELLANT.
G.R. No. 116279, January 29, 1996, DAVIDE, JR., J.
Facts:
In the morning of 31 March 1986, AAA, a resident of xxx, went to the nearby xxx
Creek to wash her family's clothes. She was alone. At around midday, between
the hours of 12:00 and 1:00 and after accomplishing her task, she decided to take
a bath in the creek. She was about to start when somebody held her neck from
behind and thereafter forcibly laid her down the ground. Only then did she
recognize her attacker, the accused Rogelio Cristobal. AAA managed to stand up
and run away, but Rogelio caught up with her and delivered two fistblows to her
stomach. Not content with this, Rogelio, while viciously holding her hair, pressed
down AAA's face into the water. Rogelio then took her three meters away from
the creek and forcibly laid her down on the ground. Because of her weakened
and pregnant state, AAA could not struggle any further. Rogelio removed her
clothes and panties. He then went on top of her, inserted his private organ into
hers, and succeeded in satisfying his lust on her. After which, he slapped and
threatened AAA with death if she would talk.
The threat went unheeded as AAA upon reaching her home, immediately told her
husband of what had happened to her. Her husband accompanied her to the
police station of xxx, to report the incident and then to Dr. Mercedita Erni-Reta
for medical examination.
Dr. Erni-Reta found that AAA's vaginal canal had a laceration at the erythematous
border at 2:00 and chemoses at 3:00 at the vaginal os. On the witness stand, Dr.
Erni-Reta confirmed these findings. She added that, upon internal examination,
she found seminal fluid in the vaginal canal which must have been there for no
longer than twenty-four hours.
The defense, on the other hand, established the following to refute the version of
the prosecution:
On 31 March 1986, Rogelio Cristobal was plowing the land of the spouses
Wilfredo and Emilia Manzano located in xxx. He started plowing at 7:00 a.m. and
went with Wilfredo to the latter's home for lunch at around 11:00 a.m.. Emilia
was with them for lunch. The three of them talked until 2:00 p.m.. He went home
thereafter, attended to his children, and then brought out his carabao to graze in
xxx, which is about 200 meters away from his house. Then he went to the house
of Meichor Cristobal. While he was at Meichor's house, a policeman by the name
of Jimmy Benedicto arrested him for the crime of rape and brought him to
Councilor Benjamin Dumlao. He was subsequently taken to the 166th PC
Detachment in xxx, where he was interrogated and where he spent the night. In
the morning, he was brought to the municipal court to face the charges filed
against him.
In its decision dated 28 March 1994, the trial court found the accused guilty
beyond reasonable doubt of the crime of rape and sentenced him to suffer the
penalty of reclusion perpetua and to indemnify the complainant, AAA, in the
amount of P30,000.00.
In this appeal, the accused contends that the trial court erred in (1) convicting
him on the basis of the private complainant's inconsistent testimony, and (2) not
giving due weight to his defense of alibi
The Appellee disagrees with him and prays that the assailed decision be affirmed
with modification of the award for moral damages, which should be increased
from P30,000.00 to P50,000.00.
Issue:
Whether or not the appellant-accused should be held liable for exemplary
damages. (Yes)
Ruling:
For sexually assaulting a pregnant married woman, the accused has shown moral
corruption, perversity, and wickedness. He has grievously wronged the
institution of marriage. The imposition then of exemplary damages by way of
example to deter others from committing similar acts or for correction for the
public good is warranted. We hereby fix it at P25,000.00.
Pursuant to the current policy of this Court, the moral damages awarded by the
trial court should be increased from P30,000.00 to P40,000.00.
WHEREFORE, the instant appeal is DISMISSED, and the decision of Branch 32 of
the Regional Trial Court of xxx, in Criminal Case No. 604 convicting the
accusedROGELIO CRISTOBAL of the crime of rape is AFFIRMED, subject to the
foregoing modifications. As modified, the award of moral damages is increased
from P30,000.00 to P40,000.00, and the accused is further ordered to pay
exemplary damages in the amount of P25,000.00.
Costs against the accused.
SO ORDERED.
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,vs. EUTIQUIA CARMEN
@ Mother Perpetuala, CELEDONIA FABIE @ Isabel Fabie, DELIA SIBONGA
@ Deding Sibonga, ALEXANDER SIBONGA @ Nonoy Sibonga, and
REYNARIO NUÑEZ @ Rey Nuñez, accused-appellants.
 G.R. No. 137268 March 26, 2001 MENDOZA, J.:
FACTS: This is an appeal from the decision1 of the RTC Cebu, finding accused-
appellants guilty of murder and sentencing them to suffer the penalty of reclusion
perpetua and to pay the heirs of the victim the amount of P50,000.00 as
indemnity as well as the costs.
The information against accused-appellants alleged that on or about the 27th day
of January, 1997, the said accused, conniving and confederating together and
mutually helping one another, with deliberate intent, with intent to kill, with
treachery and evident premeditation, did then and there inflict fatal physical
injuries on one Randy Luntayao which injuries caused the death of the said Randy
Luntayao.
Accused-appellants pleaded not guilty to the charge, whereupon they were
tried.The prosecution presented evidence showing the following:
In the afternoon of January 27, 1997, Honey Fe Abella, 10, and her friend Frances
Claire Rivera, 7, were playing takyan in front of the house of one Bebing
Lastimoso, when suddenly they heard a child shout, "Tabang ma!" ("Help
mother!"). The cry came from the direction of the house of accused-appellant
Carmen, who is also known in their neighborhood as Mother Perpetuala. The two
children ran towards Mother Perpetuala's house. What Honey Fe saw on which
she testified in court, is summarized in the decision of the trial court, to wit:
She saw a boy being immersed head first in a drum of water. Accused
Alexander Sibonga was holding the waist of the body while accused
Reynario Nuñez held the hands of the boy at the back. Accused Eutiquia
Carmen, Delia Sibonga, and Celedonia Fabie were pushing down the
boy's head into the water. She heard the boy shouting "Ma, help" for two
times. Later, she saw accused Reynario or Rey Nuñez tie the boy on the
bench with a green rope as big as her little finger. After that Eutiquia
Carmen poured [water from] a plastic container (galon) into the mouth
of the boy. Each time the boy struggled to raise his head, accused
Alexander Sibonga banged the boy's head against the bench [to] which
the boy was tied down. She even heard the banging sound everytime the
boy's head hit the bench. According to this witness after forcing the boy
to drink water, Eutiquia Carmen and accused Celedonia Fabie alias Isabel
Fabie took turns in pounding the boy's chest with their clenched fists. All
the time Rey Nuñez held down the boy's feet to the bench. She also
witnessed. Celedonia Fabie dropped her weight, buttocks first, on the
body of the boy. Later on, Eutiquia Carmen ordered Delia or Deding
Sibonga to get a knife from the kitchen. Eutiquia Carmen then slowly
plunged the stainless knife on the left side of the boy's body and with the
use of a plastic gallon container, the top portion of which was cut out,
Eutiquia Carmen [caught] the blood dripping from the left side of the
boy's body. Honey Fe heard the moaning coming from the tortured boy.
Much later she saw Nonoy or Alexander Sibonga, Reynario Nuñez, Delia
Sibonga, Celedonia Fabie, and Eutiquia Carmen carry the boy into the
house.
Eddie Luntayao, father of the victim, testified that he has five children, the eldest
of whom, Randy, was 13 years old at the time of the incident. Randy had a
"nervous breakdown". According to Eddie, his son started talking to himself and
laughing. Upon the suggestion of accused-appellant Reynario Nuñez, Eddie and
his wife Perlita and their three children went with accused-appellant Nuñez to
Cebu. They arrived in Cebu and spent the night in Nuñez's house.
The following day, they went to the house of accused-appellant Carmen in Quiot,
Pardo,5 where all of the accused-appellants were present. Eddie talked to
accused-appellant Carmen regarding his son's condition. He was told that the boy
was possessed by a "bad spirit," which accused-appellant Carmen said she could
exorcise. She warned, however, that as the spirit might transfer to Eddie, it was
best to conduct the healing prayer without him. Accused-appellants then led
Randy out of the house, while Eddie and his wife and two daughters were locked
inside a room in the house.
After a while, Eddie heard his son twice shout "Ma, tabang!" ("Mother, help!").
Eddie tried to go out of the room to find out what was happening to his son, but
the door was locked. After about an hour, the Luntayaos were transferred to the
prayer room. A few hours later, accused-appellants carried Randy into the prayer
room and placed him on the altar. Eddie was shocked by what he saw. Randy's
face was bluish and contused, while his tongue was sticking out of his mouth. It
was clear to Eddie that his son was already dead. He wanted to see his son's body,
but he was stopped from doing so by accused-appellant Eutiquia Carmen who
told him not to go near his son because the latter would be resurrected at 7
o'clock that evening.
After 7 o'clock that evening, accused-appellant Carmen asked a member of her
group to call the funeral parlor and bring a coffin as the child was already dead.
It was arranged that the body would be transferred to the house of accused-
appellant Nuñez. Thus, that night, the Luntayao family, accompanied by accused-
appellant Nuñez, took Randy's body to Nunez's house in Tangke, Talisay. The
following day, accused-appellant Nuñez told Eddie to go with him to the Talisay
Municipal Health Office to report Randy's death and told him to keep quiet or
they might not be able to get the necessary papers for his son's burial. Nuñez took
care of securing the death certificate which Eddie signed.
Accused-appellant Carmen went to Tangke, Talisay to ensure that the body was
buried. Eddie and his wife told her that they preferred to bring their son's body
with them to Sikatuna, Isabela, Negros Occidental but they were told by accused-
appellant Carmen that this was not possible as she and the other accused-
appellants might be arrested. That same afternoon, Randy Luntayao was buried
in Tangke, Talisay.
After Eddie and his family had returned home to Negros Occidental, Eddie sought
assistance from the Bombo Radyo station in Bacolod City which referred him to
the regional office of the National Bureau of Investigation (NBI) in the city. Eddie
filed a complaint for murder against accused-appellant Nuñez and the other
members of his group. He also asked for the exhumation and autopsy of the
remains of his son. As the incident took place in Cebu, his complaint was referred
to the NBI office in Cebu City.
The trial court rendered a decision that accused are all found guilty beyond
reasonable doubt of the crime of Murder and are hereby [sentenced] to suffer the
penalty of RECLUSION PERPETUA, with the accessory penalties of the law; to
indemnify jointly and severally the heirs of the deceased Randy Luntayao in the
sum of P50,000.00; and to pay the costs.
Hence, this appeal. Accused-appellants allege that the trial court erred in
convicting them of murder.
ISSUES:
(1) WHETHER OR NOT THE ACCUSED-APPELLANTS ARE GUILTY OF THE
CRIME OF MURDER.
(2) WHETHER OR NOT THE ACCUSED-APPELLANTS CAN BE HELD LIABLE
FOR RECKLESS IMPRUDENCE IN HOMICIDE, CONSIDERING THAT THE
INFORMATION CHARGES THEM WITH MURDER.
(2) WHETHER OR NOT THEY ARE ENTITLED TO AN AWARD OF EXEMPLARY
OR CORRECTIVE DAMAGES. (TOPIC RELATED)
RULING:
(1) NO. It would appear that accused-appellants are members of a cult and that
the bizarre ritual performed over the victim was consented to by the victim's
parents. With the permission of the victim's parents, accused-appellant Carmen,
together with the other accused-appellants, proceeded to subject the boy to a
"treatment" calculated to drive the "bad spirit" from the boy's body.
Unfortunately, the strange procedure resulted in the death of the boy. Thus,
accused-appellants had no criminal intent to kill the boy. Their liability arises
from their reckless imprudence because they ought that to know their actions
would not bring about the cure. They are, therefore, guilty of reckless imprudence
resulting in homicide and not of murder.
The elements of reckless imprudence are apparent in the acts done by accused-
appellants which, because of their lack of medical skill in treating the victim of
his alleged ailment, resulted in the latter's death. As already stated, accused-
appellants, none of whom is a medical practitioner, belong to a religious group,
known as the Missionaries of Our Lady of Fatima, which is engaged in faith
healing.
(2) YES. We hold that they can.
Rule 120 of the Revised Rules of Criminal Procedure provides in pertinent parts:
SEC. 4. Judgment in case of variance between allegation and proof. When
there is variance between the offense charged in the complaint or
information and that proved, and the offense as charged is included in or
necessarily includes the offense proved, the accused shall be convicted
of the offense proved which is included in the offense charged, or of the
offense charged which is included in the offense proved.
SEC. 5. When an offense includes or is included in another. An offense
charged necessarily includes the offense proved when some of the
essential elements or ingredients of the former, as alleged in the
complaint or information, constitute the latter. And an offense charged
is necessarily included in the offense proved, when the essential
 ingredients of the former constitute or form part of those constituting
the latter.
In Samson v. Court of Appeals, the Court held: while a criminal negligent act is not
a simple modality of a willful crime, but a distinct crime in itself, designated as a
quasi offense in our Penal Code, it may however be said that a conviction for
the former can be had under an information exclusively charging the
commission of a willful offense, upon the theory that the greater includes
the lesser offense. This is the situation that obtains in the present case. In other
words, the information alleges acts which charge willful falsification but which
turned out to be not willful but negligent. This is a case covered by the rule
when there is a variance between the allegation and proof. .
In People v. Fernando, the accused was charged with, and convicted of, murder
by the trial court. On appeal, this Court modified the judgment and held the
accused liable for reckless imprudence resulting in homicide after finding that he
did not act with criminal intent.
(3) YES. The accused-appellants should suffer the penalty of four (4) months of
arresto mayor, as minimum, to four (4) years and two (2) months of prision
correccional, as maximum.
As to their civil liability, accused-appellants should pay the heirs of Randy
Luntayao an indemnity in the amount of P50,000.00 and moral damages also in
the amount of P50,000.00. In addition, they should pay exemplary damages in
the amount of P30,000.00 in view of accused-appellants' gross negligence
in attempting to "cure" the victim without a license to practice medicine
and to give an example or correction for the public good.
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. EMELIO TOLENTINO y
ESTRELLA and JESUS TRINIDAD y MARAVILLA, accused-appellants.
GR No. 176385, THIRD DIVISION, February 26, 2008, CHICO-NAZARIO, J.:
FACTS:
Three separate informations of Murder and two counts of Frustrated Murder
were filed before the RTC against appellants, together with accused Jimmy
Trinidad and Arnel Trinidad.
sometime in January 1997, Rogelio Novelo, the surviving spouse of the deceased-
victim Josita Novelo, and appellant Jesus Trinidad agreed to manage and operate
a rented fishpond located in Camarines Norte. Sometime in April of the same year,
when the fishpond was yielding its first harvest, Rogelio Novelo and his wife
Josita brought the produce to Manila to be sold, while appellant Jesus Trinidad
was left to manage the fishpond. Upon the couple’s return, they discovered that
all the fish and crabs in the fishpond had already been harvested and disposed of.
Believing that appellant Trinidad was responsible for the pilferage, Josita
demanded from him either the return of the couple’s investment or be allowed to
buy appellant Trinidad’s share in the partnership. Appellant chose the latter and
was paid by the couple the amount of P9,700.00 as his share in the partnership.
When the crabs were ready for harvest, appellant Jesus Trinidad with appellant
Emelio Tolentino, Jimmy and Arnel Trinidad, without the permission from the
couple, harvested the crabs for their own benefit. The couple confronted
appellants and their cohorts, but the former’s protestation was merely ignored
by the latter. The couple filed a complaint before the barangay which was then
set for hearing on 30 August 1997.
Antonio Bea, one of the complainants and the caretaker of the couple’s fishpond,
was inside his house. He heard someone calling his name from outside his house.
Carrying a flashlight, Bea went outside and focused his flashlight towards the
direction of the fishpond watergate ("prensa"). Suddenly, someone whom he
recognized to be appellant Emelio Tolentino grabbed his hand and pulled him out
of the house. There he saw appellant Jesus Trinidad, Jimmy Trinidad and Arnel
Trinidad. Jesus Trinidad kicked Bea on the right side of his hip, and tied a rope
around his hands behind his back. Then appellant Emelio Tolentino pulled him
by the rope towards the house of a certain Ricardo Basila. Upon reaching the
house of Ricardo Basila, Arnel Trinidad called out the former. Ricardo Basila, with
a flashlight in his hand, went out of his house and focused the flashlight at the
faces of the four perpetrators. Irritated by what Ricardo Basila did, Emelio
Tolentino, Jesus and Arnel Trinidad took turns in kicking Ricardo Basila and
ordered the latter to get inside his house.
The assailants, together with Antonio Bea, proceeded to the house of the spouses
Novelo situated alongside the fishpond which was more or less 100 meters from
Basila’s house. When they arrived at the Novelo house, Jesus Trinidad called
Josita Novelo to get out of the house. Josita Novelo went out of the house holding
a light. Jesus Trinidad quickly grabbed Josita Novelo by her mouth and the two of
them went inside the house together with Emelio Tolentino, Jesus Trinidad and
Antonio Bea. From inside the house, Emelio Tolentino and Jesus Trinidad took
Antonio Bea to another door leading outside and chanced upon Antonio Novelo,
Rogelio Novelo’s brother. Immediately, Jesus Trinidad and Emelio Tolentino
kicked Antonio Novelo causing the latter to fall right into the fishpond and
disappear from sight. Antonio Bea was then tied to the door from the waist down
with Emelio Tolentino guarding him. In that position, Antonio Bea saw Josita
Novelo being mauled by Jesus Trinidad and Arnel Trinidad. All of a sudden, Jesus
Trinidad shot Josita Novelo on the left cheek with a gun. Immediately after,
Emelio Tolentino entered the house and slashed the face of Josita with a jungle
bolo. The three assailants untied the binding on Antonio Bea’s feet while leaving
the ropes tied behind his back. They left Novelo’s house proceeding towards the
fishpond watergate which was about three meters from the house. Emelio
Tolentino led the way, followed by Bea, with Jesus and Arnel Trinidad taking the
rear. Without warning, Emelio Tolentino stabbed Antonio Bea four times in the
stomach with the former’s jungle bolo. Antonio Bea fell into the fishpond.
The assailants left the victim and boarded a boat which was operated by Jimmy
Trinidad. Injured and bleeding, Antonio Bea managed to untie his hands and
swim across the river to ask for help. He received help from the people of Purok
7 and was brought to the house of the Barangay Captain Wilfredo Llarena in a
hammock. From the hospital, Barangay Captain Wilfredo Llarena, along with
some members of the police, went to the house of spouses Novelo and came upon
the dead body of Josita Novelo.
The RTC rendered a decision finding appellants guilty of the crimes charged. The
Court of Appeals affirmed the judgment of the trial court.
ISSUE:
Whether or not the court a quo gravely erred in convicting the accused-
appellants beyond reasonable doubt of the crimes charged.
RULING:
Appellants maintain that considering the lateness of the hour when the incident
took place, and the fact that it was dark, witness Antonio Bea could not have seen
clearly the faces of his attackers and that of the deceased Josita Novelo. Antoio
Bea, according to appellants, is incompetent to testify on matters relating to what
was done to the late Josita Novelo because he was tied from the waist down to
the door outside the house, thus, he could not have seen what had happened
inside the house where the deceased was brutally attacked.
Well-entrenched is the rule that the matter of assigning values to declarations on
the witness stand is best and most competently performed by the trial judge who,
unlike appellate magistrates, can weigh such testimony in light of the declarant’s
demeanor, conduct and position to discriminate between truth and falsehood.
Thus, appellate courts will not disturb the credence, or lack of it, accorded by the
trial court to the testimonies of witnesses, unless it be manifestly shown that the
latter court had overlooked or disregarded arbitrarily the facts and
circumstances of significance in the case.
In the instant case, prosecution witness Antonio Bea steadfastly pointed to
appellants and their companions as the malefactors. The identification of witness
Antonio Bea of the perpetrators of the crimes evinces factual truth of what really
occurred on that fateful night. He could not have been mistaken as to the identity
of the appellants since, at that time, he has known them personally for ten (10)
years already. Their faces were illuminated by the flashlight when witness
Antonio Bea focused the same in their direction. Also, Bea’s identification of the
assailants was corroborated by Ricardo Basila and Antionio Novelo who testified
that they likewise suffered violent acts from the malefactors during the incident.
Although Antonio Bea was tied at the door outside the house of Josita Novelo, he
declared with clarity the circumstances leading to the killing of Josita and his
near-death experience.
Furthermore, Bea’s testimony jibed with the physical evidence. The nature of the
wound of the deceased was affirmed by the medical experts to be a result of a
gunshot wound. The location of the wounds found on Josita Novelo’s face as
described by witness Bea was consistent with the documentary evidence.
The RTC convicted the appellants of murder in Criminal Case No. 98-0258 for the
killing of Josita Novelo and frustrated murder for the assault of Antonio Bea in
Criminal Case No. 98-0260 by appreciating the qualifying circumstance of
treachery and generic aggravating circumstances of nighttime and dwelling.The
RTC is correct in appreciating the qualifying circumstance of treachery in the
killing of Josita Novelo and in the stabbing of Antonio Bea. Also affirmed is the
ruling of the RTC appreciating the presence of the generic aggravating
circumstance of dwelling in Criminal Case No. 98-0258.The aggravating
circumstance of nighttime in both cases was improperly appreciated by the RTC.
Nighttime is considered an aggravating circumstance only when it is sought to
prevent the accused from being recognized or to ensure their escape.
As to damages, when death occurs due to a crime, the following may be
recovered: (1) civil indemnity ex delicto for the death of the victim; (2) actual or
compensatory damages; (3) moral damages; (4) exemplary damages; (5)
attorney's fees and expenses of litigation; and (6) interest, in proper cases.
Civil indemnity is mandatory and granted to the heirs of the victim without need
of proof other than the commission of the crime. Based on current jurisprudence,
the RTC award of civil indemnity ex delicto of P75,000.00 in favor of the heirs of
Josita Novelo is in order.
The RTC also correctly awarded moral damages in the amount of P50,000.00 in
view of the violent death of the victim. This does not require allegation and proof
of the emotional suffering of the heirs. Article 2230 of the Civil Code states that
exemplary damages may be imposed when the crime was committed with one or
more aggravating circumstances, as in this case. To deter future similar
transgressions, the Court finds that an award of P25,000.00 for exemplary
damages is proper.
As to the award of actual damages, the prosecution failed to present any receipt
to substantiate Antonio Bea’s hospitalization expenses. Nonetheless, in light of
the fact that Antonio was actually hospitalized and operated upon, this Court
deems it prudent to award P20,000.00 as temperate damages since it cannot be
denied that he suffered pecuniary loss. The award of civil indemnity in the
amount of P30,000.00 is in order. Moreover, Antonio is also entitled to moral
damages which this Court hereby awards in the amount of P40,000.00. Although
there was no testimony on the moral damages that he sustained, the medical
certificate issued by the hospital indicated that Antonio Bea sustained serious
stab injuries inflicted by appellants. It is sufficient basis to award moral damages
as ordinary human experience and common sense dictate that such wounds
inflicted on Antonio Bea would naturally cause physical suffering, fright, serious
anxiety, moral shock, and similar injury. Finally, the award in the amount of
P25,000.00 as exemplary damages is also in order considering that the crime was
attended by the qualifying circumstance of treachery. When a crime is committed
with an aggravating circumstance, either qualifying or generic, an award of
P25,000.00 as exemplary damages is justified under Article 2230 of the New Civil
Code. This kind of damage is intended to serve as deterrent to serious wrong-
doings, and as a vindication of undue sufferings and wanton invasion of the rights
of an injured or a punishment for those guilty of outrageous conduct.
DISPOSITIVE PORTION:
WHEREFORE, the Decision of the Court of Appeals dated 08 November 2006 in
CA-G.R. CR-HC No. 00880 finding appellants guilty of the crime of murder and
sentencing them to suffer the penalty of reclusion perpetua in Criminal Case. No.
98-0258, is hereby AFFIRMED with the modifications:
(1) In Criminal Case No. 98-0258, appellants are ordered to pay jointly
and severally the heirs of the victim Josita Novelo the amount of
P75,000.00 as civil indemnity, the amount of P50,000.00 as moral
damages and P25,000.00 representing exemplary damages.
(2) In Criminal Case No. 98-0260, for the crime of Frustrated Murder,
appellants are sentenced to suffer an indeterminate penalty from 6 years
and 1 day of prision mayor as minimum, to 14 years, 8 months and 1 day
of reclusion temporal as maximum. In addition, appellants are ordered
to pay jointly and severally the victim Antonio Bea the amount of
P40,000.00 as moral damages, P30,000.00 as civil indemnity,
P20,000.00 as temperate damages and P25,000.00 as exemplary
damages.
SILVERIO MARCHAN and PHILIPPINE RABBIT BUS CO., INC.,
petitioners, vs. ARSENIO MENDOZA, LEONARDA ILAYA, and ZENAIDA
MENDOZA, respondents.

FACTS: In the evening of February 22, 1954, between 9:00 and 9:30
o'clock, a passenger bus No. 141 of the Philippine Rabbit Bus Lines,
bearing Plate No. TPU-708, driven by Silverio Marchan, fell into a ditch
somewhere in Barrio Malanday, Polo, Bulacan, while travelling on its way
to Manila. As a result of which, plaintiffs-appellees Arsenio Mendoza, his
wife and child, [respondents in this proceeding], who were then inside the
bus as passengers were thrown out to the ground resulting in their
multiple injuries. Plaintiff Arsenio Mendoza suffered the most serious
injuries which damaged his vertebrae causing the paralysis of his lower
extremities which up to the time when this case was tried he continued to
suffer. The physician who attended and treated plaintiff Arsenio Mendoza
opined that he may never walk again.
Consequently the driver of said bus Silverio Marchan [now petitioner]
was prosecuted for serious, less serious and slight physical injuries
through reckless imprudence before the Justice of the Peace Court of Polo
Bulacan, and thereafter convicted as charged on June 29, 1956, which
judgment of conviction was subsequently affirmed by the Court of First
Instance of same province.
Before the CA, plaintiffs-appellees Arsenio Mendoza, his wife and child
sought to recover damages against defendant-appellant Arsenio Marchan,
then the driver of bus No. 141 of the Philippine Rabbit Bus Lines, and from
defendants-appellants Bienvenido P. Buan and Natividad Paras in their
capacity as administrator and administratix, respectively of the estate of
the late Florencio P. Buan, doing business under the style name of the
Philippine Rabbit Bus Lines, predicated not only on a breach of contract
of carriage for failure of defendants operator as well as the defendant
driver to safely convey them to their destination, but also on account of a
criminal negligence on the part of defendant Silverio Marchan resulting to
plaintiff-appellee's multiple physical damages. The CA held that from the
facts as established preponderantly by the plaintiff and substantially
corroborated by the defendant Silverio Marchan, it is clear that the cause
of the accident was the gross negligence of the defendant Silverio
Marchan who when driving his vehicle on the night in question was
expected to have employed the highest degree of care; and should have
been assiduously prudent in handling his vehicle to insure the safety of
his passengers. In ruling, the CA also imposed liability in the respective
amounts of P40,000.00 for compensatory damages and P30,000.00 for
exemplary damages.
ISSUE: Whether the imposition of compensatory and exemplary damages
by the CA is incorrect.
RULING: NO. As to compensatory damages, Considering that
respondent Arsenio Mendoza was only in his middle twenties when,
thru the negligence of petitioners, he lost the use of his limbs, being
condemned for the remainder of his life to be a paralytic, in effect
leading a maimed, well-nigh useless existence, the fixing of such
liability in the amount of P40,000.00 as compensatory damages was
well within the discretion of the Court of Appeals. It held that “it is our
considered view that the amount of P40,000.00 awarded by the court
below as compensatory damages is quite reasonable and fair, considering
that plaintiff Arsenio Mendoza had suffered paralysis on the lower
extremities, which will incapacitate him to engage in his customary
occupation throughout the remaining years of his life, especially so if we
take into account that plaintiff Arsenio Mendoza was only 26 years old
when he met an accident on January 22, 1954; and taking the average
span of life of a Filipino, he may be expected to live for 30 years more; and
bearing in mind the earning capacity of Arsenio Mendoza who before the
happening of this accident derived an income of almost P100.00 a month
from the business of his father-in-law as Assistant Supervisor of the small
[fairs] and his income of P100.00 a month which he derived as a
professional boxer."
As to exemplary damages, the CA, in awarding the same, was also correct.
It held that “It is argued that this Court is without jurisdiction to
adjudicate this exemplary damages since there was no allegation nor
prayer, nor proof, nor counterclaim of error for the same by the appellees.
It is to be observed however, that in the complaint, plaintiffs "prayed
for such other and further relief as this Court may deem just and
equitable." Now, since the body of the complaint sought to recover from and after December 14, 1964, as well as for the sum of P5,000.00 as
damages against the defendant-carrier wherein plaintiffs prayed for attorney's fees, likewise earning a legal rate of interest from and after
indemnification for the damages they suffered as a result of the January 26, 1960. Costs against petitioners.
negligence of said Silverio Marchan who is appellant's employee;
and since exemplary damages is intimately connected with general
damages, plaintiffs may not be expected to single out by express
term the kind of damages they are trying to recover against the
defendant's carrier. Suffice it to state that when plaintiffs prayed in their
complaint for such other relief and remedies that may be availed of under
the premises, in effect, therefore, the court is called upon the exercise and
use its discretion whether the imposition of punitive or exemplary
damages even though not expressly prayed or pleaded in the plaintiffs' G.R. No. 79578 March 13, 1991
complaint."
RADIO COMMUNICATIONS OF THE PHILIPPINES, INC. (RCPI), petitioner,

Further, the CA cited Singson v. Aragon, which stated that exemplary
damages may be imposed by way of example or correction only in
addition, among others, to compensatory damages, but that they cannot
be recovered as a matter of right, their determination depending upon the
discretion of the court. It further appears that the amount of exemplary
damages need not be proved, because its determination depends upon the
amount of compensatory damages that may be awarded to the claimant.
If the amount of exemplary damages need not be proved, it need not also
be alleged, and the reason is obvious because it is merely incidental or
dependent upon what the court may award as compensatory damages.
Unless and until this premise is determined and established, what may be
claimed as exemplary damages would amount to a mere surmise or
speculation. It follows as a necessary consequence that the amount of
exemplary damages need not be pleaded in the complaint because the
same cannot be predetermined. One can merely ask that it be determined
by the court if in the use of its discretion the same is warranted by the
evidence, and this is just what appellee has done.
vs.
HON. COURT OF APPEALS, and SPOUSES MINERVA TIMAN and FLORES
TIMAN, respondents.
Facts: Private respondents-spouses Minerva Timan and Flores Timan sent a
telegram of condolence to their cousins, Mr. and Mrs. Hilario Midoranda, at
Trinidad, Calbayog City, through petitioner Radio Communications of the
Philippines, Inc. (RCPI, hereinafter), to convey their deepest sympathy for the
recent death of the mother-in-law of Hilario Midoranda. to wit:
MR. & MRS. HILARIO MIDORANDA
TRINIDAD, CALBAYOG CITY
MAY GOD GIVE YOU COURAGE AND STRENGTH TO BEAR YOUR LOSS. OUR
DEEPEST SYMPATHY TO YOU AND MEMBERS OF THE FAMILY.
MINER & FLORY.

WHEREFORE, as thus modified, the decision is affirmed, petitioners being
liable for the sum of P40,000.00 in the concept of compensatory damages
with interest at the legal rate from and after January 26, 1960, and the
sum of P30,000.00 as exemplary damages with interest at the legal rate
The condolence telegram was correctly transmitted as far as the written text was
concerned. However, the condolence message as communicated and delivered to
the addressees was typewritten on a "Happy Birthday" card and placed inside a
"Christmasgram" envelope. Believing that the transmittal to the addressees
of the aforesaid telegram in that nonsuch manner was done intentionally
and with gross breach of contract resulting to ridicule, contempt, and
humiliation of the private respondents and the addressees, including their
friends and relatives, the spouses Timan demanded an explanation.
Unsatisfied with RCPI's explanations in its letters, dated March 9 and April 20,
1983, the Timans filed a complaint for damages.
The trial court rendered judgment in favor of the respondents Timans which was
affirmed in toto by the Court of Appeals.
Issue:
1. WON the act of delivering the condolence message in a Happy Birthday" card
with a "Christmasgram" envelope constitutes a breach of contract on the part of
the defendant.
2. WON plaintiff is entitled to damages (ISSUE CONNECTED TO THE TOPIC)
Ruling:
1. YES. In a distinctly similar case, and oddly also involving the herein petitioner
as the same culprit, we held:
Petitioner is a domestic corporation engaged in the business of receiving
and transmitting messages. Everytime a person transmits a message
through the facilities of the petitioner, a contract is entered into. Upon
receipt of the rate or fee fixed, the petitioner undertakes to transmit the
message accurately . . . As a corporation, the petitioner can act only
through its employees. Hence the acts of its employees in receiving and
transmitting messages are the acts of the petitioner. To hold that the
petitioner is not liable directly for the acts of its employees in the pursuit
of petitioner's business is to deprive the general public availing of the
services of the petitioner of an effective and adequate remedy.
Now, in the present case, it is self-evident that a telegram of condolence is
intended and meant to convey a message of sorrow and sympathy. Precisely, it is
denominated "telegram of condolence" because it tenders sympathy and offers
to share another's grief. It seems out of this world, therefore, to place that
message of condolence in a birthday card and deliver the same in a Christmas
envelope for such acts of carelessness and incompetence not only render violence
to good taste and common sense, they depict a bizarre presentation of the
sender's feelings. They ridicule the deceased's loved ones and destroy the
atmosphere of grief and respect for the departed.
Anyone who avails of the facilities of a telegram company like RCPI can choose to
send his message in the ordinary form or in a social form. In the ordinary form,
the text of the message is typed on plain newsprint paper. On the other hand, a
social telegram is placed in a special form with the proper decorations and
embellishments to suit the occasion and the message and delivered in an
envelope matching the purpose of the occasion and the words and intent of the
message. The sender pays a higher amount for the social telegram than for one in
the ordinary form. It is clear, therefore, that when RCPI typed the private
respondents' message of condolence in a birthday card and delivered the same in
a colorful Christmasgram envelope, it committed a breach of contract as well as
gross negligence. Its excuse that it had run out of social condolence cards and
envelopes14 is flimsy and unacceptable. It could not have been faulted had it
delivered the message in the ordinary form and reimbursed the difference in the
cost to the private respondents. But by transmitting it unfittingly—through other
special forms clearly, albeit outwardly, portraying the opposite feelings of joy and
happiness and thanksgiving—RCPI only exacerbated the sorrowful situation of
the addressees and the senders. It bears stress that this botchery exposed not
only the petitioner's gross negligence but also its callousness and disregard for
the sentiments of its clientele, which tantamount to wanton misconduct, for
which it must be held liable for damages.
It is not surprising that when the Timans' telegraphic message reached their
cousin, it became the joke of the Midorandas' friends, relatives, and associates
who thought, and rightly so, that the unpardonable mix-up was a mockery of the
death of the mother-in-law of the senders' cousin. Thus it was not unexpected
that because of this unusual incident, which caused much embarrassment and
distress to respondent Minerva Timan, he suffered nervousness and
hypertension resulting in his confinement for three days starting from April 4,
1983 at the Capitol Medical Center in Quezon City
2. YES.
Anent the award of moral and exemplary damages assigned as errors, the
findings of the respondent court are persuasive.
. . . When plaintiffs placed an order for transmission of their social
condolence telegram, defendant did not inform the plaintiff of the
exhaustion of such social condolence forms. Defendant-appellant
accepted through its authorized agent or agency the order and received
the corresponding compensation therefor. Defendant did not comply
 with its contract as intended by the parties and instead of transmitting
the condolence message in an ordinary form, in accordance with its
guidelines, placed the condolence message expressing sadness and
sorrow in forms conveying joy and happiness. Under the circumstances,
We cannot accept the defendant's plea of good faith predicated on such
exhaustion of social condolence forms. Gross negligence or carelessness
can be attributed to defendant-appellant in not supplying its various
stations with such sufficient and adequate social condolence forms when
it held out to the public sometime in January, 1983, the availability of
such social condolence forms and accepted for a fee the transmission of
messages on said forms. Knowing that there are no such forms as
testified to by its Material Control Manager Mateo Atienza, and entering
into a contract for the transmission of messages in such forms,
defendant-appellant committed acts of bad faith, fraud or malice. . . .
RCPI's argument that it can not be held liable for exemplary damages, being
penal or punitive in character, is without merit.
We have so held in many cases, and oddly, quite a number of them likewise
involved the herein petitioner as the transgressor.
. . . In contracts and quasi-contracts, exemplary damages may be awarded
if the defendant acted in a wanton, fraudulent, reckless, oppressive or
malevolent manner. There was gross negligence on the part of RCPI
personnel in transmitting the wrong telegram, of which RCPI must be
held liable. Gross carelessness or negligence constitutes wanton
misconduct.
. . . punitive damages may be recovered for wilful or wantonly negligent
acts in respect of messages, even though those acts are neither
authorized nor ratified (Arkansas & L.R. Co. vs. Stroude 91 SW 18; West
vs. Western U. Tel. Co., 17 P807; Peterson vs. Western U. Tel. Co., 77 NW
985; Brown vs. Western U. Tel. Co., 6 SE 146). Thus, punitive damages
have been recovered for mistakes in the transmission of telegrams
(Pittman vs. Western Union Tel. Co., 66 SO 977; Painter vs. Western
Union Tel. Co., 84 SE 293) (emphasis supplied).19
WHEREFORE, premises considered, the decision appealed from is AFFIRMED in
toto.
D. When not recovered
FILEMON PEREZ, petitioner, vs. COURT OF APPEALS, ET AL., respondents.
G.R. No. L-13719, EN BANC, March 31, 1965, REGALA, J.
FACTS: At about 5:30 in the morning of January 15, 1949, complainant Isidoro
Macasero went to Filemon Perez’ house to get his two mirrors which were
deposited therein for safekeeping. He knocked at the door and when Filemon
opened it he greeted said Filemon saying, "Good Morning, Manoy Imon." In
answer to his greetings, Filemon immediately struck him at the left eyebrow with
a wooden rod. When he turned his back and ran towards his house, Filemon ran
after him and struck him again at the back of the head. Upon being overtaken,
Filemon, with the help of his carpenter Luis, held him and tried to drag him back
to said Filemon’s house but they were unable to do so because he held fast to the
trunk of a fallen acacia tree. He was brought to the Southern Islands Hospital
where he was treated five times and examined by Dr. Espina. He was found to be
suffering from lacerated wounds about one-half inch long at the left supra orbital
and occipital regions; multiple contusions at the cheek, left shoulder, right and
left lumbar region, at the back and left forearm; and abrasions at the left forearm
and left leg. As a result of said injuries his face became swollen, his body ached,
his head suffered pains, and he was unable to earn his livelihood as a barber of
from P5 to P6 a day for one month. Thereafter, he resorted to home treatment as
he was embarrassed to be seen around with a swollen face.
A complaint for slight physical injuries against the petitioner Filemon Perez was
filed in the Municipal Court of Cebu City and the accused, having been found
guilty, was thereby sentenced to ten days of arresto menor. The case was
appealed to the Court of First Instance of that province, which court, considering
the aggravating circumstance of treachery to be attendant to the crime, had
raised the penalty to twenty-one days of arresto menor plus indemnification in
the sum of P25.00 for actual or compensatory damages, and P500 for moral and
exemplary damages, with subsidiary imprisonment in case of insolvency not to
exceed 1/3 of the principal penalty, plus costs. Upon further appeal to the Court
of Appeals, that court affirmed the Court of First Instance decision in all respects
except for the moral and exemplary damages which it reduced to P100.
Finally, the accused, still unsatisfied, has brought his case here by a petition for
certiorari to review the latter decision.
ISSUE: Whether or not the accused is liable for exemplary damages.
RULING: NO. In giving credence to the evidence for the prosecution, the Court of
Appeals took into account the personal circumstances of the parties as well as
their relationship to each other — the complainant being a barber, a younger
cousin of the wife of the accused and also the encargado of the latter's properties
in Cebu during the Japanese occupation. It has also been noted from the evidence
that the accused, on the other hand, is intelligent, a law graduate, a former
secretary of ex-Senator Rodriguez, senate clerk and agent of the Bureau of
Internal Revenue; that at the time of the incident he was chief of the treasury
agents of the Department of Finance; and that complainant looked upon him with
respect.
Indeed, this Court, after going over the record, finds it difficult to believe the
version of the accused. It is incredible that a person in complainant's position
would forcibly gain entrance into the house of one whom he looks up to with
respect and commit the acts imputed to him, unless he had been so seriously
aggrieved. The evidence fails to show any such grievance that could have driven
complainant to go beyond his bounds as a former employee and younger relative
of the accused's wife. And if there truly was an assault upon the latter's wife, as
he claims, it is quite strange why the said accused, who is supposed to know his
law, did not file a criminal complaint for assault against the complainant.
We, therefore, agree with the Court of Appeals in its conclusion of fact "that
appellant who has just fallen asleep and was awakened and annoyed by the
constant knocking at the door at an early hour of the morning for such trivial
matter as the mirrors and his patience having been exhausted — what with
similar incidents between his wife and complainant on previous occasions
dealing with the same mirrors — he lost control of himself and with a wooden
rod struck complainant without much ado upon seeing him when he opened the
door. And not contented, he ran after complainant and again struck him at the
back of the head.
However, We disagree with the conclusion that the aggravating circumstance of
treachery was attendant in the commission of the crime. Although the attack was
sudden and unexpected, the fact that the accused had just been aroused from his
sleep when he attacked the victim shows that he did not plan nor make any
preparation to hurt the latter in such a manner as to insure the commission of the
crime or to make it impossible or hard for him (the victim) to defend himself or
retaliate. It has been held that mere suddenness of an attack is not enough to
constitute treachery when the mode adopted does not positively tend to prove
that the assailant thereby knowingly intended to insure the accomplishment of
his criminal purpose without risk to himself arising from the defense. In this
particular case, the decision of the accused to strike the complainant seems to
have been at the spur of the moment when the said accused was awakened by the
complainant's constant knocking at the door of his house at a very early hour.
With respect to the damages awarded, Article 2219 (1) of the Civil Code provides
that moral damages may be recovered in "a criminal offense resulting in physical
injuries". On the other hand, Article 2230 of the same Code states that "In criminal
offenses, exemplary damages as part of the civil liability may be imposed when
the crime was committed with one or more aggravating circumstances. ... ."
Considering, as our findings show, that there was no treachery nor any
other aggravating circumstance in the commission of the crime, the accused
should not be made to pay for both moral and exemplary damages, but only
for moral damages, aside, of course, from the actual damages involved.
DISPOSITIVE PORTION:
WHEREFORE, the decision appealed from is hereby modified in the sense that the
penalty is reduced to eleven (11) days of arresto menor and that the accused shall
pay P50 as moral damages. In all other respects, the decision is affirmed. Costs
against the appellant.
E. Requirements for award of exemplary damages
NATIONAL STEEL CORPORATION, petitioner, vs. THE REGIONAL TRIAL
COURT OF LANAO DEL NORTE, BRANCH 2, ILIGAN CITY and E. WILLKOM
ENTERPRISES, INC., respondents. | G.R. No. 127004, THIRD DIVISION,
March 11, 1999, PURISIMA, J.
FACTS:
On November 18, 1992, Edward Wilkom Enterprises Inc. (EWEI) together with
Ramiro Construction and National Steel Corporation (NSC) executed a Contract
for Site Development. In the said contract EWEI and Ramiro Construction jointly
undertook to develop NSC’s Integrated Iron and Steel Mills Complex which is to
be established at Iligan City and to be finished on July 17, 1983. But sometime in
the year 1983, the services of Ramiro Construction was terminated thus, EWEI
took over Ramiro's contractual obligation. Due to this and to other causes
deemed sufficient by EWEI, extensions of time for the termination of the project
were granted by NSC.
Differences later arose, EWEI then filed Civil Case No. 1615 before the RTC of
Lanao del Norte, Branch 06, praying essentially for the payments of P458,381.00
with interest from the time of delay; the price adjustment as provided by PD
1594; and exemplary damages in the amount of P50,000.00 and attorney's fees.
NSC filed an answer with counterclaim.
On August 21, 1990, upon joint motion of both parties, the RTC issued an order
dismissing the said complaint and counterclaim in view of the desire of both
parties to implement Paragraph 19 of the contract, providing for a resolution of
any conflict by arbitration.
Thereafter, in accordance with the order of the RTC and pursuant to Paragraph
19 of the contract, EWEI and NSC constituted an Arbitration Board. And after
series of hearings, the Arbitrators rendered a decision directing NSC to pay EWEI
P458, 381.00 representing EWEI's last billing No. 16 with interest thereon at the
rate of 1-1/4% per month from January 1, 1985 to actual date of payment;
P1,335,514.20 representing price escalation adjustment under PD No. 1594, with
interest thereon at the rate of 1-1/4 % per month from January 1, 1985 to actual
date of payment; P50,000 as and for exemplary damages; P350,000 as and for
attorney's fees.; and P35,000.00 as and for cost of arbitration.
Aggrieved, the NSC filed a petition praying that the arbitrator’s award be vacated.
The NSC posited therein that there was evident partiality in the aforesaid
decision of the Arbitrators and that there was mistaken appreciation of the facts
and application of the law by the Arbitrators.
However, the RTC affirmed the award of the Board of Arbitrators "en toto" and
ordered that an entry of judgment be entered pursuant to R.A. No. 876. Further,
the RTC dismissed the petition of NSC praying that the arbitrator’s award be
vacated.
NSC filed a Motion for Reconsideration but the same was denied, thus the NSC
elevated the case to the Supreme Court.
ISSUE/S:
Whether or not the lower court acted with grave abuse of discretion in not
vacating the arbitrator's award. (NO)
Whether or not the award of exemplary damages and attorney’s fees by the
Arbitration Board is tenable. (NO)
RULING:
Whether or not the lower court acted with grave abuse of discretion in not vacating
the arbitrator's award.
NO.
The parties in the present case, upon entering into a Contract for Site
Development, mutually agreed that any dispute arising from the said contract
shall be submitted for arbitration. Thereunder, if a dispute should arise from the
contract, the Arbitration Board shall assume jurisdiction and conduct hearings.
After the Board comes up with a decision, the parties may immediately
implement the same by treating it as an amicable settlement. However, if one of
the parties refuses to comply or is dissatisfied with the decision, he may file a
Petition to Vacate the Arbitrator’s decision before the trial court. On the other
hand, the winning party may ask the trial court’s confirmation to have such
decision enforced.
The Court reiterated that a stipulation to refer all future disputes or to submit an
ongoing dispute to an arbitrator is VALID. Further, the Court stressed that
voluntary arbitrators, by the nature of their functions, act in a quasi-judicial
capacity. As a rule, findings of facts by quasi-judicial bodies, which have acquired
expertise because their jurisdiction is confined to specific matters, are accorded
not only respect but even finality if they are supported by substantial evidence,
even if not overwhelming or preponderant.
In a Petition to Vacate Arbitrator's Decision before the trial court, regularity in
the performance of official functions is presumed and the complaining party has
the burden of proving the existence of any of the grounds for vacating the award.
However, the NSC failed to prove the existence of the grounds it relied upon. The
allegations of NSC that there was evident partiality in the decision of the
Arbitrators in favor of EWEI and that there was mistaken appreciation of the facts
and application of the law by the Arbitrators, were both found by the SC as
untenable and unmeritorious.
As provided for by Section 24 of the Arbitration Law, the grounds for vacating the
arbitrator’s award are:
(a) award was procured by corruption, fraud or other undue means;
(b) there was evident partiality or corruption in the arbitrators of any of
them;
(c) the arbitrators were guilty of misconduct in refusing to postpone the
hearing upon sufficient cause shown, or in refusing to hear evidence
pertinent and material to the controversy; that one or more of the
arbitrators was disqualified to act as such under section nine hereof, and
willfully refrained from disclosing such disqualification or of any other
misbehavior by which the rights of any party have been materially
prejudiced; or
(d) the arbitrators exceeded their powers, or so imperfectly executed
them, that a mutual, final and definite award upon the subject matter
submitted to them was not made.
According to the Court, NSC’s allegation that there was evident partiality is
untenable. As ruled in the case of Adamson vs. Court of Appeals, the fact that a
party was disadvantaged by the decision of the Arbitration Committee does not
prove evident partiality. Proofs other than mere inference are needed to establish
evident partiality. Here, NSC merely averred evident partiality without any proof
to back it up. It was never deprived of the right to present evidence nor was there
any showing that the Board showed signs of any bias in favor of EWEI. The
decision must be sustained for it is a well settled rule that the actual findings of
an administrative body should be affirmed if there is substantial evidence to
support them and the conclusions stated in the decision are not clearly against
the law and jurisprudence similar to the instant case. Henceforth, every
reasonable intendment will be indulged to give effect such proceedings and in
favor of the regulatory and integrity of the arbitrators act.
As to the ground of mistaken appreciation of facts and law of the case, the SC
likewise found it unmeritorious.
NSC failed to prove that there was a failure on the part EWEI to complete the
work agreed upon which will determine whether Final Billing No. 16 can be made
chargeable to the cost differential paid by NSC to another contractor. NSC failed
to substantiate such allegation of completion by another contractor three
unfinished items of works, actual quantities accomplished and unit cost
differential paid chargeable against EWEI. Billing No. 16-Final would not have
passed processing payment unless there is really no such unfinished work, NSC
evaluation report with no adverse findings of unfinished work consider the
contract as completed. If at all, the unfinished work may be additional or extra
work awarded in 1984 to another contractor at prices higher than the unit price
tendered by EWEI in 1982 and/or the discrepancy between actual quantities of
work accomplished per plans versus estimated quantities of work covered by
separate contract as expansion of the original project. Also, under the contract, it
is incumbent upon the owner to send to contractor a letter within seven (7) days
after completion of the inspection to specify the objections thereto. NSC failed to
comply with such requirement, and therefore, it would be unfair to refuse
payment to EWEI, considering that it had faithfully submitted Final Billing No. 16
believing that its work had been completed because NSC did not call its attention
to any objectionable aspect of their project.
As to the price escalation, the Court held it justified in accordance with the
cardinal rule that in the interpretation of contracts that "if the terms of a contract
are clear and leave no doubt upon the intention of the contracting parties, the
literal meaning of its stipulations shall control." Additionally, price escalation is
expressly allowed under P.D. No. 1594. The SC allowed payment since it is a basic
rule in contracts that the law is deemed written into the contract between the
parties and that no prohibitory clause on price escalation was indicated in the
contract.
Whether or not the award of exemplary damages and attorney’s fees by the
Arbitration Board is tenable.
NO.
The requirements for an award of exemplary damages, are: (1) they may be
imposed by way of example in addition to compensatory damages, and only after
the claimants right to them has been established; (2) that they cannot be
recovered as a matter of right, their determination depending upon the amount
of compensatory damages that may be awarded to the claimant; (3) the act must
be accompanied by bad faith or done in a wanton, fraudulent, oppressive or
malevolent manner.
In this case, NSC did not act in bad faith or in a wanton manner when it refused
payment of the Final Billing No. 16. The belief that the work was never completed
by EWEI and that it (NSC) had the right to make it chargeable to the cost
differential paid by the latter to another contractor was neither wanton nor done
in evident bad faith. The payment of legal rate of interest will suffice to
compensate EWEI of whatever prejudice it suffered by reason of the delay caused
by NSC.
As regards the award of attorney’s fees, award for attorney’s fees without
justification is a “conclusion without a premise, its basis being improperly left to
speculation and conjecture.” The “fixed counsel’s fee” of P350,000 should be
disallowed.
DISPOSITIVE PORTION:
WHEREFORE, the awards made by the Board of Arbitrators which the trial court
adopted in its decision of July 31, 1996, are modified, thus: The award of
P474,780.23 for Billing No. 16Final and P1,335,514.20 for price adjustment shall
be paid with legal interest of six (6%) percent per annum, from January 1, 1985
until this decision shall have become final and executory; The award of P50,000
for exemplary damages and attorney’s fees of P350,000 are deleted; and The cost
of arbitration of P35,000 to supplement arbitration agreement has to be paid. No
pronouncement as to costs. SO ORDERED.
- SAB
DAMAGES IN CASE OF DEATH
A. In crimes and quasi-delict causing death
PHILIPPINE HAWK CORPORATION, Petitioner, vs. VIVIAN TAN LEE,
Respondent.
G.R. No. 166869, THIRD DIVISION, February 16, 2010, PERALTA, J.
FACTS: The accident involved a motorcycle, a passenger jee and a bus. The bus
was owned by petitioner Philippine Hawk Corporation, and was then being
driven by Margarito Avila. Respondent Vivian Tan Lee filed before the RTC of
Quezon City a Complaint against petitioner Philippine Hawk Corporation and
defendant Margarito Avila for damages based on quasi-delict, arising from a
vehicular accident that occurred. The accident resulted in the death of
respondents husband, Silvino Tan, and caused respondent physical injuries.
Respondent filed an Amended Complaint in her own behalf and in behalf of her
children, in the civil case for damages against petitioner. Respondent sought the
payment of indemnity for the death of Silvino Tan, moral and exemplary
damages, funeral and interment expenses, medical and hospitalization expenses,
the cost of the motorcycles repair, attorneys fees, and other just and equitable
reliefs.
Petitioner denied liability for the vehicular accident, alleging that the immediate
and proximate cause of the accident was the recklessness or lack of caution of
Silvino Tan. Petitioner asserted that it exercised the diligence of a good father of
the family in the selection and supervision of its employees, including Margarito
Avila.
The trial court and the Court of Appeals both found that petitioner is liable to
respondent. Hence, the present petition.
ISSUES:
1. Whether or not negligence may be attributed to petitioners driver, and
whether negligence on his part was the proximate cause of the accident,
resulting in the death of Silvino Tan and causing physical injuries to respondent
/ Whether or not petitioner is liable to respondent for damages.
2. Whether or not the damages awarded by respondent Court of Appeals are
proper.
RULING:
1.YES.The Court upholds the finding of the trial court and the Court of Appeals
that petitioner is liable to respondent, since it failed to exercise the diligence of a
good father of the family in the selection and supervision of its bus driver,
Margarito Avila, for having failed to sufficiently inculcate in him discipline and
correct behavior on the road. Foreseeability is the fundamental test of negligence.
To be negligent, a defendant must have acted or failed to act in such a way that
an ordinary reasonable man would have realized that certain interests of certain
persons were unreasonably subjected to a general but definite class of risks. In
this case, the bus driver, who was driving on the right side of the road, already
saw the motorcycle on the left side of the road before the collision. However, he
did not take the necessary precaution to slow down, but drove on and bumped
the motorcycle, and also the passenger jeep parked on the left side of the road,
showing that the bus was negligent in veering to the left lane, causing it to hit the
motorcycle and the passenger jeep.
2. YES. The Court of Appeals correctly awarded civil indemnity for the death of
respondents husband, temperate damages, and moral damages for the physical
injuries sustained by respondent in addition to the damages granted by the trial
court to respondent. The trial court overlooked awarding the additional damages,
which were prayed for by respondent in her Amended Complaint. The appellate
court is clothed with ample authority to review matters, even if they are not
assigned as errors in the appeal, if it finds that their consideration is necessary in
arriving at a just decision of the case.
The indemnity for loss of earning capacity of the deceased is provided for by
Article 2206 of the Civil Code. Compensation of this nature is awarded not for loss
of earnings, but for loss of capacity to earn money. As a rule, documentary
evidence should be presented to substantiate the claim for damages for loss of
earning capacity. By way of exception, damages for loss of earning capacity may
be awarded despite the absence of documentary evidence when: (1) the deceased
is self-employed and earning less than the minimum wage under current labor
laws, in which case, judicial notice may be taken of the fact that in the deceased’s
line of work no documentary evidence is available; or (2) the deceased is
employed as a daily wage worker earning less than the minimum wage under
current labor laws.
In this case, the records show that respondents husband was leasing and
operating a Caltex gasoline station in Gumaca, Quezon. Respondent testified that
her husband earned an annual income of one million pesos. Respondent
presented in evidence a Certificate of Creditable Income Tax Withheld at Source
for the Year 1990, which showed that respondents husband earned a gross
income of P950,988.43 in 1990. It is reasonable to use the Certificate and
respondents testimony as bases for fixing the gross annual income of the
deceased at one million pesos before respondents husband died on March 17,
1999. However, no documentary evidence was presented regarding the income
derived from their copra business; hence, the testimony of respondent as regards
such income cannot be considered.
In the computation of loss of earning capacity, only net earnings, not gross
earnings, are to be considered; that is, the total of the earnings less expenses
necessary for the creation of such earnings or income, less living and other
incidental expenses. In the absence of documentary evidence, it is reasonable to
peg necessary expenses for the lease and operation of the gasoline station at 80
percent of the gross income, and peg living expenses at 50 percent of the net
income (gross income less necessary expenses).
In this case, the computation for loss of earning capacity is as follows:
Net Earning = Life Expectancy x Gross Annual Income Reasonable and Capacity
[2/3 (80-age at the (GAI) Necessary time of death)] Expenses (80% of GAI)
X = [2/3 (80-65)] x P1,000,000.00 – P800,000.00
X = 2/3 (15) x P200,000.00 – P100,000.00
(Living Expenses)
X = 30/3 x P100,000.00
X = 10 x P100,000.00
X = P1,000,000.00
The Court of Appeals also awarded actual damages for the expenses incurred in
connection with the death, wake, and interment of respondents husband in the
amount ofP154,575.30, and the medical expenses of respondent in the amount of
P168,019.55. Actual damages must be substantiated by documentary evidence,
such as receipts, in order to prove expenses incurred as a result of the death of
the victim or the physical injuries sustained by the victim. A review of the valid
receipts submitted in evidence showed that the funeral and related expenses
amounted only to P114,948.60, while the medical expenses of respondent
amounted only to P12,244.25, yielding a total of P127,192.85 in actual damages.
Moreover, the Court of Appeals correctly sustained the award of moral damages
in the amount of P50,000.00 for the death of respondents husband. Moral
damages are not intended to enrich a plaintiff at the expense of the defendant.
They are awarded to allow the plaintiff to obtain means, diversions or
amusements that will serve to alleviate the moral suffering he/she has
undergone due to the defendants culpable action and must, perforce, be
proportional to the suffering inflicted.
In addition, the Court of Appeals correctly awarded temperate damages in the
amount of P10,000.00 for the damage caused on respondents motorcycle. Under
Art. 2224 of the Civil Code, temperate damages may be recovered when the court
finds that some pecuniary loss has been suffered but its amount cannot, from the
nature of the case, be proved with certainty. The cost of the repair of the
motorcycle was prayed for by respondent in her Complaint. However, the
evidence presented was merely a job estimate of the cost of the motorcycles
repair amounting to P17, 829.00. The Court of Appeals aptly held that there was
no doubt that the damage caused on the motorcycle was due to the negligence of
petitioners driver. In the absence of competent proof of the actual damage caused
on the motorcycle or the actual cost of its repair, the award of temperate damages
by the appellate court in the amount of P10,000.00 was reasonable under the
circumstances.
The Court of Appeals also correctly awarded respondent moral damages for the
physical injuries she sustained due to the vehicular accident. Under Art. 2219 of
the Civil Code, moral damages may be recovered in quasi-delicts causing physical
injuries. However, the award of P50,000.00 should be reduced to P30,000.00 in
accordance with prevailing jurisprudence. Further, the Court of Appeals correctly
awarded respondent civil indemnity for the death of her husband, which has been
fixed by current jurisprudence at P50,000.00. The award is proper under Art.
2206 of the Civil Code.
-Rochelle
Other illustrative cases:
FELINA RODRIGUEZ-LUNA, JOSE R. LUNA and ROBERTO R. LUNA, JR.,
petitioners, vs. THE HON. INTERMEDIATE APPELLATE COURT, JOSE E. DELA
ROSA and LUIS DELA ROSA, respondents.
G.R. No. L-62988 February 28, 1985
FACTS:
The petitioners are the heirs of Roberto R. Luna who was killed in a vehicular
collision. The collision took place at the go-kart practice area in Greenhills, San
Juan. Those involved were the go-kart driven by the deceased, a business
executive and a Toyota car driven by Luis dela Rosa, a minor of 13 years who had
no driver’s license.
In a suit for damages brought by the heirs of Roberto R. Luna against Luis Dela
Rosa and his father Jose Dela Rosa, the Court of First Instance of Manila sentenced
the defendants Dela Rosa to pay, jointly and severally, to the heirs of Luna the
sum of P1,650,000.00 as unearned net earnings of Roberto Luna, P12,000.00 as
compensatory damages, and P50,000.00 for the loss of his companionship, with
legal interest from the date of this decision; plus attorney's fees in the sum of
P50,000.00, and the costs of suit.
The Dela Rosas appealed to the defunct CA which in toto that of the trial court.
However, upon a motion for reconsideration, the CA modified insofar as the
judgment ordering the defendants to pay, jointly and severally, the sum of P
1,650,000.00 to plaintiffs with legal interest from July 5, 1973, is concerned. In
lieu thereof, defendants are ordered to pay plaintiffs, jointly and severally, the
sum of Four Hundred Fifty Thousand Pesos (P450,000.00) as unearned net
earnings of Roberto R. Luna, with legal interest thereon from the date of the filing
of the complaint until the whole amount shall have been totally paid.
Both parties filed separate petitions for review of the appellate court's decision.
In G.R. No. 57362, the petition for review of Jose and Luis dela Rosa, for failure of
the petitioners to file an amended petition as required, the case was dismissed.
The dismissal was final.
The instant case — G.R. No. 62988 — is the separate appeal of the Lunas. The
petition was given due course. The resolution stated that the SC took notice that
the wrongful death occurred as early as January 18, 1970, and that until now the
process of litigation is not yet over. In the meantime the value of the Philippine
peso has been seriously eroded so that the heirs of the deceased may ultimately
have a greatly depreciated judgment. In the interest of justice, the private
respondents were ordered to pay to the petitioners within thirty (30) days from
notice the following amounts adjudged against them: P450,000.00 for unearned
net earnings of the deceased; P12,000.00 as compensatory damages; P50,000.00
for the loss of his companionship with legal interest from July 3, 1973; and
P50,000.00 as attorney's fees.
The Dela Rosas failed to pay the amounts and when required to explain they said
that they had no cash money. Accordingly, this Court directed the RTC to issue a
writ of execution but the attempt of the special sheriff to enter the private
respondent's premises so that he could make an inventory of personal properties
was thwarted by guards and this Court had to direct the Chief of the Philippine
Constabulary to assist in enforcing the writ of execution. In the meantime, Luis
dela Rosa is now of age, married with two children, and living in Madrid, Spain
with an uncle but only casually employed. It is said: "His compensation is hardly
enough to support his family. He has no assets of his own as yet."
ISSUES:
Whether the CA erred when it reduced Luna's life expectancy from 30 to 10 Years
and increased his annual personal expenses from P20,000.00 to P30,000.00. ---
YES
RULING:
The award of P1,650,000.00 was based on two factors, namely: (a) that the
deceased Roberto R. Luna could have lived for 30 more years; and (b) that his
annual net income was P55,000.00, computed at P75,000.00 annual gross income
less P20,000.00 annual personal expenses.
This is what the trial court said on Luna's life expectancy:
According to the American Experience Table of Mortality, at age
33 the life expectancy of Roberto Luna was 33.4 years, and
under the Commissioner Standard Ordinary, used by our
domestic insurance companies. Dr. Vicente Campa said that
except for a slight anemia which he had ten years earlier,
Roberto Luna was of good health. Allowing for this condition, he
could reasonably expect to have a life expectancy of 30 years.
The Court of Appeals sustained the trial court's conclusion. It likewise sustained
the trial court in respect of Luna's annual income and expense. This is what the
trial court said:
Roberto Luna was 33 years old when he died, and was survived
by his wife Felina Rodriguez-Luna, and two children, Roberto Jr.,
13 years, and Jose, 12 years. His wife was 35 years old at the
time. He declared a gross income of P16,900.00 for 1967,
P29,700,000 for 1968 and P45,117.69 for 1969. He had
investments in various corporations amounting to P136,116.00
(Exhibits K, M, M-1, N, N-1 to N-3, O, O-1, P, Q and R) and was the
president and general manager of Rodlum Inc.; general manager
of Esso Greenhills Service Center; Assistant manager of Jose
Rodriguez Lanuza Sons; director of Steadfast Investment
Corporation; chairman and treasurer of Greenhills Industrial
Corporation; vice-president of Oasis, Inc.; director of Nation
Savings Association; director of Arlun Taxi; and treasurer of
National Association of Retired Civil Employees.
His income tax returns show an increase in his income in the
short period of three years. It is reasonable to expect that it
would still go higher for the next fifteen years and reach a
minimum of P75,000.00 a year. The potential increase in the
earning capacity of a deceased person is recognized by the
Supreme Court. ... the court believes that the expected gross
earnings of Roberto Luna should be fixed in the sum of
P75,000.00 a year for the period of his life expectancy of 30
years, but deducting his personal expenses which, because of his
business and social standing the court in the amount of
P20,000.00 a year, in accordance with the rulings of the
Supreme Court.
HOWEVER, acting on the MR filed by dela Rosas, the CA took into account the fact
"that the deceased Roberto R. Luna had been engaged in car racing as a sport,
having participated in tournaments both here and abroad;" it said that Luna's
habit and manner of life should be "one of the factors affecting the value of
mortality table in actions for damages;" and, consequently, concluded that Luna
could not have lived beyond 43 years. The result was that the 30-year life
expectancy of Luna was reduced to 10 years only.
Further on the motion for reconsideration, the Court of Appeals ruled in respect
of Luna's annual personal expenses considered the escalating price of automobile
gas which is a key expenditure in Roberto R. Luna's social standing. It increased
that amount to P30,000.00 as the would be personal expenses of the deceased
per annum. The Court of Appeals then determined the amount of the award thus:
P75,000.00 annual gross income less P30,000.00 annual personal expenses
leaves P45,000.00 multiplied by 10 years of life expectancy and the product is
P450,000.00.
The Court of Appeals, in reducing Luna's life expectancy from 30 to 10 years said
that his habit and manner of life should be taken into account, i.e. that he had
been engaged in car racing as a sport both here and abroad - a dangerous and
risky activity tending to shorten his life expectancy. That Luna had engaged in car
racing is not based on any evidence on record. That Luna was engaged in go-kart
racing is the correct statement but then go-kart racing cannot be categorized as a
dangerous sport for go-karts are extremely low slung, low powered vehicles, only
slightly larger than foot-pedalled four wheeled conveyances. It was error on the
part of the Court of Appeals to have disturbed the determination of the trial court
which it had previously affirmed.
Similarly, it was an error for the Court of Appeals to reduce the net annual income
of the deceased by increasing his annual personal expenses but without at the
same time increasing his annual gross income. It stands to reason that if his
annual personal expenses should increase because of the "escalating price of gas
which is a key expenditure in Roberto R. Luna's social standing" [a statement
which lacks complete basis], it would not be unreasonable to suppose that his
income would also increase considering the manifold sources thereof.
PEOPLE OF THE PHILIPPINES, Appellee, v. EDDIE LACHICA (at-large),
ARIEL ROLLON, and ERROL ROLLON, Accused.
G.R. No. 131915 September 3, 2003. CALLEJO, SR., J.
FACTS:
In the evening of September 24, 1995, some residents of Sitio Sapang Palay,
Barangay Pili, San Fernando, Romblon, attended the wake of Palmeta Rollon.
Among those paying their last respects were Ariel Rollon, Edgar Perez, Alejandro
Rogero and his older brother Melchor Rogero. Ariel and Edgar were already tipsy,
having had a drinking spree in celebration of the birthday of Ariel’s son. After a
while, Ariel and Edgar decided to go home. On their way, they saw Kagawad Jose
Rafol, who was then fixing a rundown water pipe. For no apparent reason, Edgar
boxed Jose. When the latter tried to retaliate, Ariel, who was close behind, moved
in to aid his friend. At that juncture, Kagawad Thomas Rios who was on his way
to the wake, intervened and pacified the protagonists. However, Jose’s son, Dixon,
arrived and punched Edgar who fell to the ground. Ariel fled to call for
reinforcements. After an hour and a half, Ariel, on board a tricycle driven by his
brother Errol Rollon, and armed with a bolo, returned to the wake. With them
were Eddie Lachica and Salvador Romano, who were each armed with guns. They
were followed closely on foot by Ariel and Errol’s father Felipe Rollon, their
youngest brother, Filjun Rollon, and Francisco Rabino.
After the tricycle pulled over the roadside, Errol immediately alighted and boxed
Jose. A fisticuffs ensued. Jose’s other son, Dicky, arrived, pacified Errol and his
father and brought the latter home.
Errol broke a bottle of gin on the pavement. Eddie followed suit, firing his gun
into the air. Errol and his companions pursued Jose and Dicky to their house and
pelted it. When an occupant of the house screamed for help, Errol and his group
retreated and went back to where the wake was being held. When Ariel saw
Kapitan Tito Royo, he attempted to hack the latter with his bolo, but the bolo hit
the wooden pole which Filjun used to strike Tito. Tito managed to evade the blow,
and dove under the table. He then fled to his house, which was about 50 meters
away. A commotion ensued.
In the meantime, Felipe and his sons Errol and Ariel, with Eddie Lachica, Salvador
Romano, Danilo Perez and Francisco Rabino, all boarded the tricycle and went
after Tito. As they reached the gate of Tito’s house, they chanced upon Alejandro
and Melchor. The two were on their way home from the wake and were just
waiting for their younger brother Isidro who got separated from them during the
commotion. Errol alighted from the tricycle and greeted Alejandro and Melchor,
waving his left hand. Alejandro likewise waved his hand saying, "Pre, waya kita
(Friend, there is nothing between us)." Errol curtly retorted, "Waya ka diyan (You
have nothing here)." Errol blocked Alejandro and Melchor’s way. Ariel vented his
ire on Alejandro and hacked the latter on his left arm. Alejandro retaliated and
boxed Ariel, who fell to the ground. Errol then joined the fray, but was held at bay
by Alejandro. Eddie suddenly shot Alejandro, who fell prostrate to the ground. In
the meantime, Melchor could not help his brother because Francisco had his gun
aimed at the latter. Errol then shot Alejandro two more times on the head and on
his body. Ariel, for his part, then hacked the hapless Alejandro with his bolo.
Melchor somehow managed to sneak out without being noticed and ran for dear
life to the house of Thomas Rios. When Melchor was already inside the house, he
heard someone shout, "Patay na ina! (Kill him!)." Melchor heard another gunshot.
He peeped through a hole and saw the dead body of his brother, Alejandro, being
run over by the tricycle driven by Errol. Melchor could only watch in horror and
grief. He could not do anything more for his brother.
The malefactors then left the crime scene. Melchor stepped outside and rushed
towards his brother, who was soaked in his own blood. He cried out for help and
a handful of people came. Melchor proceeded to the police station to report the
incident but was waylaid by an unidentified person who chased him. He doubled
back and took a shortcut home.
Police authorities arrived at the scene of the crime and investigated the incident.
They learned that Errol and Ariel were among the malefactors. The next morning,
SPO4 Ramon Rutor, Chief of Police, PNP San Fernando, Romblon, arrived at the
Sibuyan District Hospital in Cajidiocan, Romblon, where Errol and Ariel were
treated for their injures. Ariel surrendered to SPO4 Rutor a bolo which was
allegedly used by Alejandro to attack him and his brother. Dr. Leticia V. Chan, the
Municipal Health Officer of San Fernando, Romblon, conducted an autopsy on the
cadaver of the victim. She prepared and signed a Postmortem Examination
Report which states that the cause of death was Internal hemorrhage sec. to
gunshot wounds of the head, chest and abdomen.
Melchor and Thomas executed their respective sworn statements on the incident.
After the requisite preliminary investigation, an Information was filed, against
Ariel and Errol Rollon, and Eddie Lachica. When arraigned, Errol and Ariel
assisted by counsel, pleaded not guilty to the charge. Eddie Lachica remained at
large. Trial on the merits thereafter ensued. Ariel denied the charge.
After due proceedings, the trial court rendered judgment finding Ariel and Errol
guilty beyond reasonable doubt of the crime charged. The trial court disbelieved
the appellants’ denials and assertion that Eddie Lachica alone killed the victim.
Both accused interposed their appeal from the decision of the trial court.
On September 2, 1998, Ariel Rollon died due to cardio-respiratory arrest while
detained at the Romblon Provincial Jail. On January 27, 1999, we resolved to
dismiss the case. Hence, only the appeal of appellant Errol Rollon is left for our
determination.
ISSUES:
1. Whether or not the trial court erred in giving credence and probative
weight to the testimonies of the prosecution witnesses while
disbelieving that of the Appellant.
2. What are the civil liabilities of the accused (DAMAGES ISSUE)
RULING:
The appeal is barren of merit.
Well-settled is the rule that the findings of facts and assessment of credibility of
witnesses is a matter best left to the trial court because of its unique position of
having observed that elusive and incommunicable evidence of the witnesses’
deportment on the stand while testifying, which opportunity is denied to the
appellate courts. Only the trial judge can observe the furtive glance, blush of
conscious shame, hesitation, flippant or sneering tone, calmness, sigh, or the
scant or full realization of an oath — all of which are useful aids for an accurate
determination of a witness’ honesty and sincerity. The trial court’s findings are
accorded finality, unless there appears in the record some fact for circumstance
of weight which the lower court may have overlooked, misunderstood or
misappreciated, and which, if properly considered, would alter the result of the
case.
The denial of the appellant of the crime charged cannot prevail over the positive
declarations of the prosecution witnesses that he and his cohorts killed the
victim. Like the defense of alibi, a denial is inherently weak and crumbles in the
light of positive declarations of truthful witnesses who testified on affirmative
matters that the appellant was at the scene of the incident and was one of the
victim’s assailants. Moreover, denial, being a negative defense, must be
substantiated by clear and convincing evidence. Otherwise, it would merit no
weight in law and cannot be given greater evidentiary value over the testimony
of credible witnesses who testified on affirmative matters. The denial offered by
the appellant is not only inherently weak, it lacked a strong corroboration.
Indeed, even if the defense of denial is supported by the testimony of friends of
the appellant, it deserves the barest consideration.
More importantly, the autopsy conducted by Dr. Leticia V. Chan on September 25,
1995, corroborated the testimony of the witnesses, that the appellant and his
group shot and hacked the victim. The physical evidence shows that the victim
sustained a total of no less than 20 wounds — 5 gunshot wounds and 11 incised
wounds on different parts of his body, a partially amputated thumb and several
abrasions. In contrast, the appellant did not suffer any major injuries, except for
the minor cut on his left arm which was inflicted by his late brother Ariel when
the appellant’s group ganged up on the victim to finish him off. It is difficult to
believe that Alejandro could, all by his lonesome, initiate the attack on the
appellant and his six cohorts who were each armed with bolos and handguns.
Even if Alejandro was, as claimed by the appellant, armed with a bolo, he was at
the mercy of the appellant and his six cohorts. The claim, therefore, of the
appellant that Alejandro single-handedly attacked them is weak and flimsy.
Physical evidence is evidence of the highest order. It speaks more eloquently than
a hundred witnesses. 24 In the case at bar, the physical evidence, consistent with
the testimonies of the prosecution witnesses, established the appellant’s
culpability beyond reasonable doubt.
We agree with the trial court that the appellant is guilty of murder under Article
248 of the Revised Penal Code, as amended by Republic Act No. 7659, qualified
by abuse of superior strength as alleged in the Information. To take advantage of
superior strength is to purposely use excessive force, out of proportion to the
means of defense available to the person attacked. 36 In the case at bar, there was
a clear and gross disparity of strength between the unarmed victim and the four
armed assailants — three of whom were armed with firearms. The victim gave
no provocation and was in fact already backing off when he was attacked.
Civil Liabilities of the Appellant
Conformably to recent jurisprudence, we sustain the amount of P50,000 for civil
indemnity. Article 2206 of the Civil Code provides that when death occurs as a
result of a crime, the heirs of the deceased are entitled to be indemnified without
need of any proof thereof.
We cannot award moral damages in the absence of proof of mental or physical
suffering on the part of the heirs of the victim. As to actual damages, while
Melchor Rogero testified that they incurred burial and other expenses resulting
from the death of Alejandro, no competent evidence was presented to prove his
claim. Under Article 2199 of the Civil Code, a party is entitled to compensation
only for such pecuniary loss suffered by him as he has duly proved. Only
substantiated and proven expenses, or those that appear to have been genuinely
incurred in connection with the death, wake or burial of the victim will be
recognized in court. 42 However, under Article 2224 of the same Code, temperate
damages may be recovered when the court finds that some pecuniary loss has
been suffered but its amount cannot, from the nature of the case, be proved with
certainty. In the present case, the heirs of Alejandro clearly incurred funeral and
burial expenses. Hence, we find that the amount of P7,500 by way of temperate
damages is justified.
In the same vein, loss of earning capacity cannot be awarded to the victim’s heirs
in the absence of competent proof thereof. While Melchor testified on the victim’s
income, the same could not serve as a basis for lost earnings. Indemnification for
loss of earning capacity partakes of the nature of actual damages which must be
duly proven; and a self-serving statement, being unreliable, is not enough. For
lost income to be recovered, there must be an unbiased proof of the deceased’s
average, not just gross, income.
Additionally, given the attendance of the qualifying circumstance of abuse of
superior strength, the award of exemplary damages in the amount of P25,000 to
the heirs of the victim in accordance with Article 2230 of the Civil Code, is in
order. 46
WHEREFORE, the appealed decision of the Regional Trial Court of Romblon,
Branch 81, finding appellant Errol Rollon guilty beyond reasonable doubt of
murder is hereby AFFIRMED. The civil aspect of the case is MODIFIED to read:
The appellant is hereby ORDERED to pay the heirs of the victim Alejandro Rogero
the amounts of P50,000 as civil indemnity; P7,500 as temperate damages; and
P25,000 as exemplary damages. Costs against the Appellant.
Nueva Espana vs. People
ANTONIO V. NUEVA ESPAÑA vs. PEOPLE OF THE PHILIPPINES
G.R. No. 163351, June 21, 2005, CORONA, J
At about 11:15 a.m. on May 15, 1998, petitioner Antonio E. Nueva España was
driving a passenger bus owned by Vallacar Transit, Inc. He was then traversing
the national highway of Calag-Calag, Ayungon, Negros Oriental and was
southbound going to Dumaguete City. While negotiating a curve, the passenger
bus collided with a northbound Honda motorcycle. As a result, Reynard So, the
driver of the motorcycle, and Nilo Castro, the person riding in tandem with him,
were killed. An information for reckless imprudence resulting in double homicide
was filed against petitioner who was also accused of failing to extend aid or
assistance to the victims.
The father of So testified that his son was 30 years old at the time of his death and
he was engaged in the buying and selling of copra. He was likewise a sugar cane
planter and maintained a sari-sari store. So’s father claimed that his son was
earning ₱30,000 a month from his copra business and sari-sari store, and
₱50,000 a month from selling sugar cane. He added that his family spent ₱87,2002
for the wake and funeral. He also demanded payment of attorney’s fees of
₱30,000.
The mother of Castro, on the other hand, testified that her son was 26 years old
when he died. He worked as welder in Manila and earned ₱8,000 a month. She
allegedly spent ₱30,000 for her son’s wake and burial.
The trial court gave no credence to the defense witnesses and convicted
petitioner of the crime charged. The dispositive part of the decision read:
WHEREFORE, premises considered, this court finds accused, ANTONIO
VILLANUEVA NUEVA ESPAÑA, guilty beyond reasonable doubt for the crime of
RECKLESS IMPRUDENCE RESULTING TO DOUBLE HOMICIDE, and aggravated by
his failure to help the victim, as provided for Article 365 of the Revised Penal
Code, and appreciating in his favor the benefits of the Indeterminate Sentence
Law, is hereby imposed the indeterminate penalty of SIX (6) MONTHS of arresto
mayor as minimum to SIX (6) YEARS AND ONE (1) DAY of prision correcional as
maximum, and to pay the following damages:
TO THE HEIRS OF THE VICTIM REYNARD SO
1) ₱2,997,000.00 – indemnity for loss of earning capacity of victim
2) 14,200.00 – for expenses of the wake
 3) 20,000.00 – for funeral parlor
"Net earning capacity (x) = life x gross-living expenses annual (50%
4) 12,000.00 – for the tomb expectancy of

5) 53,000.00 – for cost of burial site gross annual income)"

6) 30,000.00 – for attorney’s fees

Thusly, since the victim Reynard So was earning ₱80,000 a month at the time of
7) 200,000.00 – for moral damages
his death when he was thirty (30) years old, his lost earning capacity should be
8) 100,000.00 – for exemplary damages computed as follows:

₱3,429,200.00 – TOTAL AMOUNT

x = 2 (80 ― 30) x [₱960,000.00 ―
which total amount shall bear interest at the rate of TWELVE (12%) percent per ₱480,000.00]
annum from the date of this decision until the same is paid.

TO THE HEIRS OF VICTIM NILO CASTRO 3

1) ₱1,728,000.00 – indemnity for loss of earning capacity

x = 33.4 x
2) 20,000.00 – for funeral expenses
₱480,000.00
3) 200,000.00 – for moral damages

4) 50,000.00 – for exemplary damages x = ₱16,032,000.00

₱1,998,000.00 – TOTAL AMOUNT

With respect to the victim Nilo Castro, he was earning ₱8,000.00 a month when
which total amount shall bear interest at the rate of TWELVE (12%) percent per
he died at the age of twenty-six (26). His lost earnings were:
annum counted from the date of this decision until the same is fully paid.

Cost against accused.

x = 2 (80 ― 26) x [₱96,000.00 ―
SO ORDERED. ₱48,000.00]

Via a petition for review, petitioner appealed the judgment of the court a quo to
the Court of Appeals. On November 2, 2003, the appellate court modified the 3
assailed judgment:

As to the civil liability, particularly the indemnity for the loss of the earning
capacity of the victims, the formula last enunciated by the Supreme Court is:

x = 36 x commission of the crime. Hence, based on recent jurisprudence, the award of civil
₱48,000.00
x = ₱1,728,000.00
which the trial court correctly computed.
The other items of damages awarded are correct.6
The appellate court likewise provided for the subsidiary liability of petitioner’s
employer under Article 1037 of the Revised Penal Code. The dispositive portion
of the decision read:
WHEREFORE, the Decision appealed from is AFFIRMED, subject to
MODIFICATION as to the penalty imposed; the indemnity for loss of
earning capacity of the victim Reynard So; the reckoning date of the start
of the 12% interest imposed; and the subsidiary civil liability of the
accused appellant’s employer, all as herein-above indicated. Costs
against appellant. SO ORDERED
ISSUE: Whether the award of damages in the (total) amount of more than ₱18
Million is untenable and contrary to jurisprudence and law
RULING:
YES. The award of damages in the total amount of more than ₱18 Million is
untenable and contrary to jurisprudence and law
When death occurs due to a crime, the following damages may be recovered: (1)
a civil indemnity ex delicto for the death of the victim; (2) actual or compensatory
damages; (3) moral damages; (4) exemplary damages; (5) attorney’s fees and
expenses of litigation, and (6) interest, in proper cases.
CIVIL INDEMNITY ex delicto
Both the trial court and the Court of Appeals failed to award civil indemnity ex
delicto to the heirs of the victims. The award for civil indemnity is mandatory and
is granted to the heirs of the victim without need of proof other than the
indemnity ex delicto of ₱50,000 each for the heirs of both So and Castro is in order.
ACTUAL DAMAGES: INDEMNITY FOR LOSS OF EARNING CAPACITY AND
OTHER COMPENSATORY DAMAGES
With respect to indemnification for loss of earning capacity, the Court, in the case
of People vs. Mallari, enunciated:
The rule is that documentary evidence should be presented to substantiate a
claim for loss of earning capacity. By way of exception, damages therefore may
be awarded despite the absence of documentary evidence if there is testimony
that the victim was either (1) self-employed, earning less than the minimum wage
under current labor laws, and judicial notice is taken of the fact that in the victim's
line of work, no documentary evidence is available; or (2) employed as a daily-
wage worker earning less than the minimum wage under current labor laws.
In this case, neither of the two exceptions applied. The earnings of So and Castro
were both above the minimum wage set by labor laws in their respective
workplaces at the time of their death. This being the case, the general rule of
requiring documentary evidence of their earning capacities finds application.
Unfortunately for their heirs, no such proof was presented at all. It was therefore
erroneous for both the trial court and the Court of Appeals to award
compensatory damages for loss of earning capacity on the basis alone of the oral
testimonies of So’s father and Castro’s mother.
The lack of documentary evidence notwithstanding, since loss was actually
established in this case, temperate damages in the amount of ₱25,000 each may
be awarded to the heirs of So and Castro, respectively. Under Article 2224 of the
Civil Code, temperate or moderate damages (which are more than nominal but
less than compensatory damages) may be recovered when the court finds that
some pecuniary loss was suffered but its amount cannot be proved with
certainty.
With respect to other compensatory damages, the Court in People v. Agudez
declared that competent evidence must likewise be presented to support the
claim for such damages. In the case at bar, the father of So claimed that he spent
₱87,200 for the wake and burial of his son but all he was able to support with
receipts were the payment to the funeral parlor of ₱20,000 and the cost of the
burial site of ₱53,000. ₱ 50,000 - civil indemnity ex delicto

Regarding the claim for reimbursement of the actual expense allegedly incurred
by the mother of Castro, the Court opts to award her temperate damages, in lieu
of actual or compensatory damages, because she failed to submit any evidence in 73,000 - actual damages
support thereof. Again, temperate damages should instead be given since it was
to be expected that she spent for the burial and funeral services although the
amount thereof was not determined with certitude. 25,000 - temperate damages26

MORAL DAMAGES

The award for moral damages by the court a quo, as affirmed by the Court of 50,000 - moral damages
Appeals, should be adjusted for being excessive. While courts have a wide latitude
in ascertaining the proper award for moral damages, the award should not be to
such an extent that it inflicts injustice on the accused. The award of ₱200,000 as 25,000 - exemplary damages
moral damages each for the heirs of So and Castro, respectively, should
accordingly be reduced to ₱50,000.
30,000 - attorney’s fees
EXEMPLARY DAMAGES

Under Article 2230 of the Civil Code, exemplary damages may also be imposed
when the crime was committed with one or more aggravating circumstances.
Here, petitioner failed to render aid or assistance to his victims after the collision. ₱ 253,000
Based on the prevailing jurisprudence, the award for exemplary damages for - TOTAL
homicide is ₱25,000.

ATTORNEY’S FEES The heirs of Nilo Castro are also entitled to the following:

We affirm the award of ₱30, 000 for attorney’s fees made by the trial court and
the appellate court. Under Article 2208 of the Civil Code, attorney’s fees and
₱ 50,000 - civil indemnity ex delicto
expenses of litigation may be recovered when exemplary damages have been
awarded, as in this case.

SUMMARY 50,000 - temperate damages27

To summarize, the heirs of the deceased Reynard So are entitled to the following:
50,000 - moral damages
 G.R. No. 182192, October 29, 2008, CHICO-NAZARIO, J.:
25,000 - exemplary damages
FACTS:

An Information was filed with the RTC charging appellant with murder. That the
30,000 - attorney’s fees special aggravating circumstance of the use of an unlicensed firearm is attendant
in the commission of the offense.

The prosecution presented as witnesses Anacleto Gonzales (Anacleto), Maria

₱ 205,000
- TOTAL
SUBSIDIARY LIABILITY
We adopt the pronouncement of the Court of Appeals regarding the subsidiary
liability of petitioner’s employer, Vallacar Transit Inc., under Article 103 of the
Revised Penal Code. An employer may be subsidiarily liable for the employee’s
civil liability in the criminal action if it can be shown that: (1) the employer is
engaged in any kind of industry; (2) the employee committed the offense in the
discharge of his duties and (3) the accused is insolvent. However, subject to
prevailing jurisprudence, the subsidiary liability may be enforced only upon a
motion for subsidiary writ of execution against Vallacar Transit, Inc. and upon
proof that petitioner is insolvent.
Dispositive Portion:
WHEREFORE, the decision appealed from is AFFIRMED with MODIFICATIONS as
to the award of damages and the penalty imposed, as already discussed. The total
amount of damages shall bear interest at the rate of 12% per annum from the
finality of this decision.
Costs against petitioner.
SO ORDERED.
Antonette Gonzales (Antonette), Senior Police Officer 1 Felixberto Cabungcal
(SPO1 Cabungcal), SPO1 Florentino Buenafe (SPO1 Buenafe), Dr. Edwin Castillo
(Dr. Castillo), Dr. Antonio S. Vertido (Dr. Vertido), and Marita Gonzales Vda. de
Barte (Mrs. Barte).
Anacleto, cousin of herein deceased victim Police Chief Inspector Marcos P. Barte
(Inspector Barte) of the Batangas City Police Station, testified that on 24 August
2002, at around 3:30 p.m., Inspector Barte, accompanied by a certain Roberto
Godoy (Godoy) and Ronnie Valiente (Valiente), arrived at his house located at
Barangay Kumintang Ibaba, Batangas City. He, Inspector Barte, Godoy, Valiente,
and Anacleto’s father-in-law, Nicasio Resurreccion (Nicasio), talked and drank
gin inside the house. Subsequently, the group, with the exception of Godoy, left
the house and went to a videoke bar owned by a certain Sergeant Emilio Vidal
(Sgt. Vidal) located at Ebora Road, Barangay Kumintang Ibaba, Batangas City.
They arrived at the videoke bar at about 8:30 p.m. He drank one bottle of beer
while Inspector Barte consumed two bottles of beer. Thereafter, at about 9:15
p.m., the group went out of the videoke bar. He saw his wife, Antonette, outside
the videoke bar. Antonette approached and talked to him. He also saw Godoy
seated in the driver’s seat of an owner-type jeep parked near the videoke bar, and
a certain Imelda Shin (Imelda) sitting at the back portion of the jeep. Valiente
boarded the jeep and sat beside Imelda. Inspector Barte also boarded the jeep
and sat in the front passenger’s seat beside Godoy. When Anacleto was about to
board the jeep, appellant suddenly appeared and approached Inspector Barte.
Appellant asked Inspector Barte if he was "Major Barte." Thereupon, he saw
appellant shoot Inspector Barte several times with a short firearm. He was then
one arm’s length from Inspector Barte and one meter away from appellant.
Inspector Barte slumped on his seat bloodied while Godoy shouted that he was
also hit. Appellant immediately fled the scene.

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. AGRIPINO GUEVARRA

y MULINGTAPANG alias "BOY DUNGGOL
For its part, the defense presented the testimonies of appellant and Ferdinand
Ravino (Ravino) to refute the foregoing accusation. No documentary evidence
was presented. Appellant denied any liability and interposed the defense of alibi.
Appellant testified that at the time of the incident (9:15 p.m., 24 August 2002),
he was at Barangay Malad, Calapan City, Oriental Mindoro vacationing at the
house of a certain Hector Africa (Africa). He arrived therein on the afternoon of
23 August 2002 and left on the morning of 26 August 2002. He was not
acquainted with Inspector Barte and came to know that he was accused of killing
Inspector Barte when he arrived at Batangas City from Oriental Mindoro on the
afternoon of 26 August 2002. He was informed that he would be "salvaged" for
killing Inspector Barte. Hence, he became afraid and hid in his house for two
weeks. Thereafter, he surrendered to the mayor of Batangas City who turned him
over to the Batangas City police. He alleged that Anacleto and Antonette testified
against him because he did not support the candidacy of Antonette during the
previous election for barangay captain where Antonette lost. He supported then
the candidacy of the incumbent barangay captain.
RTC rendered a Decision on 4 July 2006 convicting appellant of murder.
Appellant was sentenced to reclusion perpetua. He was also ordered to pay the
heirs of Inspector Barte the amounts of ₱50,000.00 as compensatory damages,
₱109,250.00 as actual damages, ₱50,000.00 as moral and exemplary damages,
₱4,212,312.72 for loss of earning capacity, and cost of suit.
The appellate court promulgated its Decision affirming with modification the RTC
Decision. It held that an additional amount of ₱25,000.00 as exemplary damages
should also imposed on appellant because the qualifying circumstance of
treachery attended the killing of Inspector Barte.
ISSUE:
Whether or not appellant is liable for damages (YES)
RULING:
After carefully reviewing the evidence on record and applying the foregoing
guidelines to this
case, we found no cogent reason to overturn the RTC’s ruling finding the
testimonies of Anacleto and Antonette credible. As an eyewitness to the incident,
Anacleto positively identified appellant as the one who shot Inspector Barte with
a short firearm. He was merely one arm’s length from Inspector Barte and one
meter away from appellant during the incident.
As to damages, both courts acted accordingly in awarding civil indemnity 61 to
the heirs of Inspector Barte since the award of this damage is mandatory in
murder cases. Nevertheless, the amount of ₱50,000.00 imposed as civil
indemnity should be increased to ₱75,000.00 based on prevailing jurisprudence.
In People v. Quiachon, we explained that even if the penalty of death is not to be
imposed on accused because of the prohibition in Republic Act No. 9346, the civil
indemnity of ₱75,000.00 is still proper as the said award is not dependent on the
actual imposition of the death penalty but on the fact that qualifying
circumstances warranting the imposition of the death penalty attended the
commission of the offense. In the instant case, the qualifying circumstance of
treachery and the special aggravating circumstance of use of unlicensed firearm
attended the killing of Inspector Barte. These circumstances were duly alleged in
the information and proven during the trial.
The award of moral damages in the amount of ₱50,000.00 is proper in view of the
violent death of Inspector Barte and the resultant grief to his family. Likewise,
the award of exemplary damages in the amount of ₱25,000.00 is in order because
the killing of Inspector Barte was committed with the aggravating circumstances
of treachery and use of an unlicensed firearm. Also, the award of ₱109,250.00 as
actual damages is appropriate since these were supported by official receipts
attached on records.
The heirs of Inspector Barte should also be indemnified for loss of earning
capacity pursuant to Article 2206 of the New Civil Code. 68 Consistent with our
previous decisions, 69 the formula for the indemnification of loss of earning
capacity is:
Net Earning Capacity = Life Expectancy x [Gross Annual Income (GAI) – Living
Expenses]
= 2/3 (80 – age of deceased) x (GAI - 50% of GAI).
Inspector Barte’s death certificate states that he was 46 years old at the time of
his demise. The pay slip issued by the PNP, Camp Crame, Quezon City, to
Inspector Barte for August 2002 shows that the latter was earning an annual
gross income of ₱371,784.00. Applying the above-stated formula, the indemnity
for the loss of earning capacity of Inspector Barte is ₱4,213,551.00, computed as
follows:
Net Earning Capacity = 2/3 (34) x (₱371,784.00 – ₱185,892.00)
= 2/3 (34) x ₱185,892.00. = ₱4,213,551.00.
Hence, the amount of ₱4,212,312.72 awarded to the heirs of Inspector Barte as
indemnity for the latter’s loss of earning capacity should be increased to
₱4,213,551.00.
In addition to the damages awarded, we also impose on all the amounts of
damages an interest at the legal rate of 6% from this date until fully paid.
WHEREFORE, after due deliberation, the Decision of the Court of Appeals in CA-
G.R. CR H.C. No. 02367, dated 16 October 2007, is hereby AFFIRMED with the
following MODIFICATIONS: (1) the civil indemnity of appellant is increased from
₱50,000.00 to ₱75,000.00; (2) the indemnity for Inspector Barte’s loss of earning
capacity is increased from ₱4,212,312.72 to ₱4,213,551.00; and (3) an interest
on all the damages awarded at the legal rate of 6% from this date until fully paid
is imposed.
SO ORDERED.
-MIKA ITURIAGA
B.1 General rule and exceptions
G.R. Nos. 137370-71. September 29, 2003.
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. SPO1 ARMANDO LOZANO
@ AMID, (acquitted) DAVE SAMSON, (acquitted) EUTIQUIANO PACAÑA, JR., @
TOKING PACAÑA, (acquitted) and RAUL OCO @ BOY USHER, accused. RAUL
OCO @ BOY USHER, appellant.
FACTS
This is an Automatic Review of the Decision of the RTC in Criminal Cases Nos.
CBU-46172-73 finding appellant Raul “Boy Usher” Oco guilty beyond reasonable
doubt of the crimes of murder and frustrated murder, and imposing the supreme
penalty of death.
Surviving victim Herminigildo Damuag testified that at around 9:30 p.m. of
November 24, 1997, he was driving his motorcycle (referred to as the first
motorcycle in the Records) along V. Rama Avenue, Cebu City with the late Alden
Abiabi riding with him at the back. When they reached the vicinity of Pica
Lumber, a white Tamaraw FX AUV overtook their motorcycle (first motorcycle)
and blocked their path, forcing him to slow down. Another motorcycle (second
motorcycle), with 2 riders on it, appeared behind the first motorcycle. From a
distance of about 2-3 ters, one of the riders of the second motorcycle suddenly
fired two (2) shots in close succession. Damuag attempted to look at the tires of
his motorcycle, thinking that they have exploded. Suddenly, Abiabi pushed him
with his body. Abiabi fell from the first motorcycle and slumped on the pavement
face down. The Tamaraw FX AUV sped away. As Damuag was trying to control his
motorcycle, he noticed another motorcycle (third motorcycle) passed by from
behind him. His motorcycle zigzagged towards the gutter. Damuag was thrown
off and hit the ground. He stood up and realized that he was hit at the right side
of his body. He then heard a burst of gunfire from behind. Damuag saw the third
motorcycle at about 2-3 meters. It was on a stop. Appellant was at the back of the
third motorcycle, holding a short firearm in his right hand. Appellant fired his gun
at him but missed. Although wounded, Damuag was able to run. However, the
third motorcycle chased him. Upon reaching the vicinity of Five Brothers
restaurant, Damuag stopped because he could not pass anymore. From a distance
of about 4-5 meters, the appellant again fired 2 more shots at Damuag. The third
motorcycle sped away towards B. Rodriguez Street. Damuag was initially rushed
to the hospital. He survived the attack due to the timely medical attention given
to him.
Alden Abiabi did not survive the ambush. He sustained 8 gunshot wounds on the
different parts of his body. At the time of his death, Abiabi was working as a legal
researcher at Clear, Inc., with a monthly income of P8,000.00. Mrs. Amelia Abiabi
testified that she spent a total of P250,000.00 for funeral services; P50,000.00 of
which was spent for the coffin alone.
After the trial, the trial court found the appellant guilty of murder and frustrated
murder. The court doubted the credibility of eyewitnesses Gamboa and Ybanez,
Jr. who claimed to have seen not only the face of the appellant but of his three (3)
co-accused as well. Thus, the appellant’s co-accused were acquitted.
The case is now with this Court for review.
ISSUE:
Whether or not the conviction of petitioner Raul Oco must be affirmed.
RULING:
The judgment of conviction is affirmed.
Motive is not an essential element of a crime, and hence, need not be proved for
purposes of conviction. Standing alone, the failure of the prosecution to adduce
proof of the appellant’s motive to kill Abiabi and injure Damuag would not
exculpate him, especially since he was positively identified by at least two
credible witnesses as one of the assailants.
To be sure, the fact that the appellant’s companions wore helmets does not make
his identification by the eyewitnesses incredulous. We agree with the Solicitor
General’s observation that criminals carry out their criminal designs differently.
Some cover their faces, but others boldly perform their criminal acts in full view
of the public. The records show that appellant belongs to the latter category.
It is to be noted that Damuag is not just an ordinary eyewitness. He is a survivor
of that tragic incident. His identification of his attacker deserves full credit. It is
the natural reaction of victims of criminal violence to strive to see the looks and
faces of their assailants and observe the manner in which the crime was
committed.
We come to the award of damages. The trial court ordered the appellant to
indemnify the heirs of Abiabi and the victim Herminigildo Damuag the amount of
P1,000,000.00 and P500,000.00, respectively, without specifying what these
amounts represent.
In line with the recent jurisprudence, we modify the amount due the heirs of
Abiabi as follows: (a) P50,000.00 as actual damages representing the duly
receipted expense for the purchase of the coffin, (b) P50,000.00 as civil
indemnity, and (c) P25,000.00 as temperate damages.
Except for the cost of the coffin, the remainder of P250,000.00, which Mrs. Abiabi
claimed to have spent for funeral and burial services, is unsubstantiated and
therefore, cannot be awarded.
Furthermore, although Mrs. Abiabi testified that her husband earned P8,000.00
monthly as a legal researcher of Clear, Inc., we cannot award indemnity for loss
of earning capacity in the absence of documentary evidence.
There are only two exceptions to the general rule requiring documentary
evidence for claims for damages for loss of earning capacity: (1) if the
deceased is self-employed earning less than the minimum wage under
current labor laws, and judicial notice may be taken of the fact that in the
victim’s line of work no documentary evidence is available; or (2) if the
deceased is employed as a daily wage worker earning less than the
minimum wage under current labor laws. Clearly, this case does not fall under
the exceptions.
We reduce the amount due the victim Herminigildo Damuag. Damuag cannot
recover actual damages for aside from his bare allegations that he spent
P160,000.00 for hospitalization and P5,000.00 for medicinal needs, there is
nothing on the record to substantiate his claim. In lieu of this, we award the
amount of P25,000.00 as temperate damages since it cannot be denied that he
has suffered some pecuniary loss because of the incident.
IN VIEW WHEREOF, the joint decision on review is hereby AFFIRMED with the
following MODIFICATIONS.
(1) In Crim. Case No. CBU-46172, appellant RAUL OCO @ BOY USHER is
found GUILTY beyond reasonable doubt of MURDER under Art. 248 of
the Revised Penal Code, as amended by Rep. Act No. 7659, and is
sentenced to suffer the penalty of reclusion perpetua. He is ORDERED to
pay the heirs of Alden Abiabi the amount of P50,000.00 as actual
damages, P50,000.00 as civil indemnity, and P25,000.00 as temperate
damages.
(2) In Crim. Case No. CBU-46173, appellant RAUL OCO @ BOY USHER is
found GUILTY beyond reasonable doubt of FRUSTRATED MURDER and
is sentenced to suffer an indeterminate penalty of six (6) years and one
(1) day of prision mayor as minimum, to fourteen (14) years and eight
(8) months of reclusion temporal as maximum. He is ORDERED to
 indemnify Herminigildo Damuag the amount of P25,000.00 as temperate
damages.
PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee, vs. JORIE WAHIMAN y
RAYOS, Accused-Appellant.
G.R. No. 200942 June 16, 2015
FACTS: Appellant Jorie Wahiman y Rayos was charged with the crime of murder
for the death of Jose Buensuceso. During his arraignment, appellant pleaded not
guilty.
The prosecution established that on April 2, 2003, at around 10 o'clock in the
evening, Buensuceso, the manager of Stanfilco-Dole, Phils. in Malaybalay City,
was on his way back to the company staff house on board his Isuzu pick-up after
attending a despedida for one of his employees. While he was about to enter the
gate of the staff house, he was gunned down by persons riding in tandem on a
black motorcycle. The guard on duty, David Azucena , who was then opening the
gate, identified one of the assailants as herein appellant.
During trial, the prosecution submitted in evidence the extrajudicial confession
of appellant taken during the preliminary investigation of the case, admitting to
the killing of Buensuceso. Appellant stated therein that he was hired by Alex
Laranjo and Kid Canadilla, for and in behalf of a certain Alonzo who owns a quarry
in San Isidro, Valencia, to kill the victim for a fee. According to appellant, Alonzo
wanted the victim killed because the latter withheld the release of his collectibles
from Stanfilco-Dole.
However, when it was appellant’s turn to testify, he narrated that at the time of
the killing, he was at Landing Casisang, Malaybalay City attending the birthday
celebration of his brother-in-law.
RTC rendered its Decision finding appellant guilty as charged. The CA found no
reason to depart from the trial court’s findings.
ISSUE:
W/N damages for loss of earning capacity may be awarded in this case
RULING: YES
Regarding the award for lost earnings, the general rule is that there must be
documentary proof to support indemnity for loss of earning capacity.
By way of exception, damages for loss of earning capacity may be awarded
despite the absence of documentary evidence when
(1) the deceased is self-employed earning less than the minimum wage
under current labor laws, and judicial notice may be taken of the fact
that in the deceased’s line of work no documentary evidence is
available; or
(2) the deceased is employed as a daily wage worker earning less than
the minimum wage under current labor laws.
Notably, this case does not fall under any of the exceptions. The deceased victim
could not be considered as a self-employed earning less than the minimum wage;
neither could he be considered employed as a daily wage worker. However, we
are inclined to award lost earnings considering that the deceased, as testified by
his widow, was the manager of Stanfilco-Dole, Phils. in Malaybalay City and was
receiving a monthly salary of ₱95,000.00. He was 54 years of age when gunned
down by appellant. This testimony was not objected to by appellant or
questioned during cross-examination or on appeal. Clearly, the existence of
factual basis of the award has been satisfactorily established. However, the
amount of the award for lost earnings must be modified following the
formula [2/3 x 80 – age] x [gross annual income - necessary expenses
equivalent to 50% of the gross annual income]. Thus: [2/3 x (80-54)]
[(₱95,000 x 12) – 50% (₱95,000 x 12)] = ₱9,878,100.00.
In addition, the awards of actual damages in the amount of ₱25,000.00 must be
deleted for lack of proof; in lieu thereof, temperate damages in the amount of
₱25,000.00 is awarded. The awards of civil indemnity in the amount of
₱75,000.00, and moral damages in the amount of ₱75,000.00, are in line with
prevailing jurisprudence. In addition, the heirs of the victim are entitled to
exemplary damages in the amount of ₱30,000.00. Finally, all damages awarded
shall earn interest at the rate of 6% per annum from date of finality of this
resolution until full payment.
DISPOSITIVE PORTION:
WHEREFORE, the assailed October 13, 2011 Decision of the Court of Appeals in
CA-G.R. CR H.C. No. 00830-MIN finding appellant Jorie Wahiman y Rayos guilty
beyond reasonable doubt of the crime of murder is AFFIRMED with
MODIFICATIONS in that appellant is not eligible for parole; the award for lost
earnings is reduced to ₱9,878,100.00; the award of actual damages is deleted; in
lieu thereof, appellant is ordered to pay the heirs of the victim ₱25,000.00 as
temperate damages; he is likewise ordered to pay the heirs of the victim
exemplary damages in the amount of ₱30,000.00; and all damages awarded shall
earn interest at the rate of 6% per annum from date of finality of this resolution
until full payment. SO ORDERED.
PHILIPPINE COMMERCIAL INTERNATIONAL BANK, Petitioner, vs.
JOSEPH ANTHONY M. ALEJANDRO, Respondent.
FACTS: Petitioner PCIB filed against respondent Alejandro a complaint
for a sum of money with prayer for the issuance of a writ of preliminary
attachment. Said complaint alleged that on September 10, 1997,
Alejandro, a resident of Hong Kong, executed in favor of PCIB a
promissory note obligating himself to pay P249,828,588.90 plus interest.
In view of the fluctuations in the foreign exchange rates which resulted in
the insufficiency of the deposits of Alejandro as security for the loan, PCIB
requested the latter to put up additional security. Alejandro sought a
reconsideration of said request pointing out petitioner’s alleged
mishandling of his account due to its failure to carry out his instruction to
close his account as early as April 1997, when the prevailing rate of
exchange of the US Dollar to Japanese yen was US$1.00:JPY127.50. The
amount of P249,828,588.90 was the consolidated amount of a series of
yen loans granted by PCIB to Alejandro during the months of February
and April 1997.
In praying for the issuance of a writ of preliminary attachment under
Section 1 paragraphs (e) and (f) of Rule 57 of the Rules of Court, petitioner
alleged that (1) respondent fraudulently withdrew his unassigned
deposits notwithstanding his verbal promise to PCIB not to withdraw the
same prior to their assignment as security for the loan; and (2) that
respondent is not a resident of the Philippines.
The trial court granted the application and issued the writ ex parte after
PCIB posted a Php 18.7M bond, issued by Prudential Guarantee &
Assurance Inc. Also, the bank deposits of Alejandro with RCBC were
garnished. Alejandro, through counsel, voluntarily submitted to the
jurisdiction of the court.
Subsequently, Alejandro filed a motion to quash the writ contending that
the withdrawal of his unassigned deposits was not fraudulent as it was
approved by PCIB. He also alleged that petitioner knew that he maintains
a permanent residence at Calle Victoria, Ciudad Regina, Batasan Hills,
Quezon City, and an office address in Makati City at the Law Firm Romulo
Mabanta Buenaventura Sayoc & De los Angeles, where he is a partner. In
both addresses, petitioner regularly communicated with him through its
representatives. Respondent added that he is the managing partner of the
Hong Kong branch of said Law Firm; that his stay in Hong Kong is only
temporary; and that he frequently travels back to the Philippines.
The trial court issued an order quashing the writ and holding that the
withdrawal of respondent’s unassigned deposits was not intended to
defraud petitioner. It also found that the representatives of petitioner
personally transacted with respondent through his home address in
Quezon City and/or his office in Makati City. It thus concluded that
petitioner misrepresented and suppressed the facts regarding
respondent’s residence considering that it has personal and official
knowledge that for purposes of service of summons, respondent’s
residence and office addresses are located in the Philippines.
With the denial of PCIB’s motion for reconsideration, it elevated the case
to the CA via a petition for certiorari. The petition was dismissed for
failure to prove that the trial court abused its discretion in issuing the
aforesaid order. PCIB filed a motion for reconsideration but was denied.
On petition with the SC, the case was dismissed for late filing. PCIB filed a
motion for reconsideration but was likewise denied with finality on
March 6, 2000.
Meanwhile, on May 20, 1998, Alejandro filed for damages in the amount
of P25 Million on the attachment bond posted by Prudential Guarantee &
Assurance, Inc. on account of the wrongful garnishment of his deposits.
He presented evidence showing that his P150,000.00 RCBC check payable
to his counsel as attorney’s fees, was dishonored by reason of the
garnishment of his deposits. He also testified that he is a graduate of the
Ateneo de Manila University in 1982 with a double degree of Economics
and Management Engineering and of the University of the Philippines in
1987 with the degree of Bachelor of Laws. Respondent likewise
presented witnesses to prove that he is a well-known lawyer in the
business community both in the Philippines and in Hong Kong.
The trial court awarded damages to Alejandro in the amount of P25
Million without specifying the basis thereof. It also denied petitioner’s
motion for reconsideration.
PCIB elevated the case to the CA which affirmed the findings of the trial
court. It held that in claiming that respondent was not a resident of the
Philippines, petitioner cannot be said to have been in good faith
considering that its knowledge of respondent’s Philippine residence and
office address goes into the very issue of the trial court’s jurisdiction
which would have been defective had respondent not voluntarily
appeared before it. The CA, however, reduced the amount of damages
awarded to petitioner and specified their basis: P2M as nominal damages;
P5M as moral damages; and P1M as attorney’s fees, to be satisfied against
the attachment bond under Prudential Guarantee & Assurance, Inc.
Both parties moved for reconsideration. The CA denied PCIB’s motion for
reconsideration but granted that of Alejandro’s by ordering PCIB to pay
additional P5M as exemplary damages.
ISSUE: Whether PCIB is liable for damages for the improper issuance of
the writ of attachment against Alejandro
RULING: YES, but not actual damages. The Court of Appeals is correct in
not awarding the same inasmuch as the respondent failed to establish the
amount garnished by petitioner. It is a well settled rule that one who has
been injured by a wrongful attachment can recover damages for the actual
loss resulting therefrom. But for such losses to be recoverable, they must
constitute actual damages duly established by competent proofs, which
are, however, wanting in the present case.
Nominal damages may be awarded to a plaintiff whose right has been
violated or invaded by the defendant, for the purpose of vindicating or
recognizing that right, and not for indemnifying the plaintiff for any loss
suffered by him. Its award is thus not for the purpose of indemnification
for a loss but for the recognition and vindication of a right. In this case,
nominal damages is proper considering that the right of respondent to use
his money has been violated by its garnishment. The amount of nominal
damages must, however, be reduced from P2 million to P50,000.00
considering the short period of 2 months during which the writ was in
effect as well as the lack of evidence as to the amount garnished.
The award of attorney’s fees is proper when a party is compelled to incur
expenses to lift a wrongfully issued writ of attachment. The basis of the
award thereof is also the amount of money garnished, and the length of
time respondents have been deprived of the use of their money by reason
of the wrongful attachment. It may also be based upon (1) the amount
and the character of the services rendered; (2) the labor, time and trouble
involved; (3) the nature and importance of the litigation and business in
which the services were rendered; (4) the responsibility imposed; (5) the
amount of money and the value of the property affected by the
controversy or involved in the employment; (6) the skill and the
experience called for in the performance of the services; (7) the
professional character and the social standing of the attorney; (8) the
results secured, it being a recognized rule that an attorney may properly
charge a much larger fee when it is contingent than when it is not. All the
aforementioned weighed, and considering the short period of time it took
to have the writ lifted, the favorable decisions of the courts below, the
absence of evidence as to the professional character and the social
standing of the attorney handling the case and the amount garnished, the
award of attorney’s fees should be fixed not at P1 Million, but only at
P200,000.00.
The courts below correctly awarded moral damages on account of
petitioner’s misrepresentation and bad faith; however, we find the award
in the amount of P5 Million excessive. Moral damages are to be fixed upon
the discretion of the court taking into consideration the educational,
social and financial standing of the parties. Moral damages are not
intended to enrich a complainant at the expense of a defendant. They are
awarded only to enable the injured party to obtain means, diversion or
amusements that will serve to obviate the moral suffering he has
undergone, by reason of petitioner’s culpable action. Moral damages
must be commensurate with the loss or injury suffered. Hence, the award
of moral damages is reduced to P500,000.00.
Considering petitioner’s bad faith in securing the writ of attachment, we
sustain the award of exemplary damages by way of example or correction
for public good. While as a general rule, the liability on the attachment
bond is limited to actual (or in some cases, temperate or nominal)
damages, exemplary damages may be recovered where the attachment
was established to be maliciously sued out. Nevertheless, the award of
exemplary damages in this case should be reduced from P5M to
P500,000.00.
WHEREFORE, the petition is PARTIALLY GRANTED. The May 31, 2006
Decision of the Court of Appeals in CA-G.R. CV No. 78200 is AFFIRMED
with MODIFICATIONS. As modified, petitioner Philippine Commercial
International Bank is ordered to pay respondent Joseph Anthony M.
Alejandro the following amounts: ₱50,000.00 as nominal damages,
₱200,000.00 as attorney’s fees; and ₱500,000.00 as moral damages, and
₱500,000.00 as exemplary damages, to be satisfied against the
attachment bond issued by Prudential Guarantee & Assurance Inc.,45
under JCL (4) No. 01081, Bond No. HO-46764-97.
b.2. Other illustrative cases
PEOPLE OF THE PHILIPPINES, appellee, v. EUSEBIO DUBAN y DOMINGO @
JUN, appellant.
FACTS
In an information2 dated October 28, 1997, appellant was indicted as follows:
That on or about October 9, 1997 at 11:00 am, in the City of Manila, Philippines,
the said accused did then and there willfully, unlawfully and feloniously, with
intent to kill and with treachery and evident premeditation, attack, assault and
use personal violence upon DIONISIO BARBOZA by then and there striking him
with a stone at the back of his head, thereby causing traumatic head injury which
cause (sic) his death thereafter.
Contrary to law.
Upon arraignment3 on November 18, 1997, appellant, assisted by counsel de
oficio, entered a plea of not guilty. Thereafter, trial on the merits ensued.
On October 9, 1997, at 11:00 a.m., appellant admittedly hurled at the victim a
stone estimated to weigh one kilo, hitting the victim at the right rear portion of
his head and ear, causing him to fall on the ground unconscious. The victim died
hours later after he was brought to the Jose Reyes Memorial Medical Center.
Appellant claimed self-defense, however. The prosecution claimed otherwise,
alleging that it was plain murder.
ISSUE
Whether or not the award of damages is proper
HELD
in line with prevailing jurisprudence, the award of indemnity to the heirs of the
victim in the amount of P50,000.00 is affirmed, it being awarded without need of
proof other than the fact that a crime was committed resulting in the death of the
victim and that the accused was responsible therefor.22cräläwvirtualibräry
As for the award by the trial court of moral damages to the legal heirs of the victim
in the amount of P200,000.00, not only is the amount exorbitant, there is also no
evidence to show that the legal heirs of the victim suffered any mental anguish or
serious anxiety arising from the victims death.
The award of P70,000.00 for nominal damages must be deleted for lack of factual
and legal basis.
This Court notes that while Rolly Barboza, the victims brother, testified that the
victims family incurred medical and funeral expenses in the amount of
P65,000.00, he, in support thereof, presented a list 23 of expenses. Only
substantiated and proven expenses, however, or those that appear to have been
genuinely incurred in connection with the death, wake or burial of the victim will
be recognized in court.24 A list of expenses is not considered a competent proof
and cannot replace the official receipts necessary to justify the award of actual
damages. 25 Neither can the funeral contract26 submitted in evidence by the
prosecution be sufficient, it not being proof that what was stipulated therein was
eventually paid.27cräläwvirtualibräry
Nonetheless, where no sufficient proof of actual damages is presented in the trial
court (or when the actual damages proven is less than P25,000.00), the amount
of P25,000.00 as temperate damages may be awarded, it being reasonable to
presume that when death occurs, the family of the victim necessarily incurs
expenses for the wake and funeral.28cräläwvirtualibräry
Under Article 2206 of the Civil Code, the heirs of the victim are entitled to
indemnity for loss of earning capacity. Ordinarily, documentary evidence is
necessary for the purpose. By way of exception, testimonial evidence may suffice
if the victim was either (1) self-employed, earning less than the minimum wage
under current labor laws, and judicial notice may be taken of the fact that in the
victims line of work, no documentary evidence is available; or (2) employed as a
daily-wage worker earning less than the minimum wage under current labor
laws.29 In the case at bar, however, while the victims brother testified that the
victim earned P300.00, he did not indicate whether the same referred to the
victims hourly, daily, monthly or annual income.30cräläwvirtualibräry
Indemnification for loss of earning capacity partakes of the nature of actual
damages which must be duly proven31 by competent proof and the best
obtainable evidence thereof.32cräläwvirtualibräry
Exemplary damages must be awarded too in accordance with Article 2230 of the
Civil Code, the qualifying circumstance of treachery being present.
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. FEDERICO BALANAG
alias "Pedring," accused-appellant,TITO BALAWAG alias "Andres," (at large)
and ROBERTO BALANAG alias "Berto," (at large) accused.
G.R. No. 103225, SECOND DIVISION, September 15, 1994,PUNO, J.
Accused-appellant Federico Balanag and father and son Roberto and Tito Balanag
were charged with Robbery with Homicide.
Tito and Federico were arraigned on April 17, 1986. They pleaded not guilty and
underwent trial. Roberto Balanag, on the other hand, has remained at large.
Before the prosecution could finish cross-examining Tito Balanag, he absconded.
He was thus tried in absentia.
The essential facts came mainly from the testimonies of eyewitnesses Iluminada
Lopez and Genoveva Lopez y Obra.
On November 24, 1985, at about 7:30 P.M., GUILLERMO LOPEZ, SR., a dentist, was
talking to his wife, ILUMINADA LOPEZ, in the living room of their house, situated
in Sitio Salapac, Aringay, La Union, while their daughter, GENOVEVA LOPEZ y
OBRA, was in the kitchen, brushing her teeth. Suddenly, three (3) men barged
into the front door of Dr. Lopez' house. Iluminada and Genoveva recognized two
(2) of them as their neighbors TITO BALANAG (a.k.a. Andres) and FEDERICO
BALANAG (a.k.a. Pedring). The third man, whom the Lopezes had seen for the
first time, was later identified as SERAFIN DACANAY, a "compadre" of Federico.
Serafin immediately announced a "hold-up." He poked a gun at the head of
Iluminada, held her arm and then led her towards Genoveva's room on the second
floor of the house. Serafin demanded money and other valuables from Iluminada.
She then summoned Genoveva to give her the keys to the cabinet. Her daughter
followed.
Upon seeing Genoveva upstairs, Serafin also poked the gun at her head. Genoveva
thus obediently proceeded towards the cabinet, near the door of her room, and
she was about to open the cabinet when her father, Dr. Lopez, rushed upstairs. As
Dr. Lopez was ascending the stairs, Serafin yelled at him saying: "Okinam nga
lakay sica ti ngangidarum quen Berto Balanag (Vulva of your mother, you are (sic)
the one (who) filed a case against Berto Balanag." He shot Dr. Lopez who fell
down the stairs which had no railings. Downstairs, the victim was met by accused
Tito Balanag who stabbed him (the victim) with a dagger. Serafin then went
downstairs and, likewise, stabbed the victim. Seeing the helpless condition of her
father, Genoveva screamed. She and her mother also rushed downstairs.
Iluminada thought of asking for help from their neighbors. Thus, she ran past her
husband and proceeded outside their house thru the backdoor. Genoveva, on the
other hand, went to her father's aid as Serafin continued assaulting her father.
During the commotion, Tito and Federico fled, taking with them Genoveva's
shoulder bag containing a diamond ring and earrings worth three thousand pesos
(P3,000.00); fifty dollars
(US $50.00) cash; two hundred pesos (P200.00) cash; and a mini-stereo cassette,
valued at P2,000.00.
Iluminada had barely stepped out of the house when she was blocked by "Berto"
(Roberto) Balanag, Tito's father, who aimed his gun at her. Iluminada quickly
retreated to the house and closed the backdoor. She stood behind the door and
locked it as Berto tried to force his way in.
In the meantime, Genoveva and Serafin grappled for the bolo of the latter. Irked,
he lunged at her, but she bravely parried the thrust with her arm. Her left
forefinger was cut in the process. Serafin also fired at her but missed. By stroke
of luck, Genoveva managed to get a bolo and attacked Serafin in self defense.
Serafin died. So did the wounded Dr. Lopez. Several neighbors of the Lopezes who
heard the commotion arrived at the scene. One of them, a certain Jose Dulay,
reported the incident to the authorities.
That evening, police authorities, namely: Station Commander P/Sgt. Alejandro
Basallo, Pfc. Benjamin Rulloda, Pat. Simeon Madarang, and Pat. Wilson Argame
inspected the locus criminis.
Dr. Armando Avena, Medical Officer of the Rural Health Unit of Doña Gregoria
Memorial District Hospital in Aringay, La Union, conducted the postmortem
examination on the victim's body. Based on his examination, Dr. Lopez sustained
abrasion wound, two (2) stab wounds, and multiple gunshot wounds (on the
right breast upper outer quadrant, right zygomatic area and right upper lip). Dr.
Avena also treated Genoveva Lopez Obra who sustained lacerated wound on the
3rd left forefinger.
According to the widow, Iluminada, her dentist husband used to earn P10,000.00
monthly. At the time of her husband's death, they had three (3) children in
college. She suffered mental anguish and could hardly sleep or eat upon her
husband's death. During the two weeks wake for her deceased husband, she
spent, more or less, P25,000.00.
After trial, the court a quo found Federico Balanag and his co-accused Tito
Balanag guilty of Robbery with Homicide. They were meted the penalty of
reclusion perpetua. The court a quo also ordered accused-appellant and Tito
Balanag, to indemnify, solidarily, the heirs of the deceased Dr. Guillermo Lopez,
the following amounts:
a) P50,000.00 — for the death of Guillermo
Lopez;
b) P48,110.00 — as actual damages;
c) P20,000.00 — as moral damages; and
d) P172,000.00 — for loss of earning capacity.
Both accused appealed. However, Tito Balanag, who has remained at large, did
not file the required Appellant's Brief. His appeal was considered abandoned for
failure to prosecute his appeal and, more importantly, for his refusal to submit
himself to the jurisdiction of the authorities.
ISSUE:
Whether or not there should be an award for loss of the earning capacity of the
deceased.(YES)
RULING:
We affirm the judgment of conviction.
At least two credible witnesses, Iluminada and Genoveva, positively identified
accused-appellant Federico Balanag as among those who barged into their house
that tragic evening. Genoveva even saw accused-appellant when he fled from the
scene, taking with him a mini-stereo cassette. These eyewitnesses could not have
been mistaken as they knew Federico and Tito even before the incident. The
records reveal that the Lopezes and the Balanags were neighbors since birth.
It was also not improbable for the eyewitnesses to recognized the faces of the
culprits. According to Genoveva, the accused were not wearing masks, albeit
Serafin was wearing a hat. At that time, too, the place of incident was well lighted
as 50 watts electric bulbs, installed along the porch, in the living room and the
kitchen, were on.
The credibility of these eyewitnesses is further enhanced by the fact that
Iluminada and Genoveva had no ill feelings against Federico prior to the incident.
Accused-appellant himself confirmed this lack of ill motive. Thus, we see no
reason to depart from the well established rule that when there is no evidence to
show that the prosecution witnesses were actuated by improper motive, their
identification of the accused should be given full faith and
credit.
In connection with the civil liability of accused-appellant, the award of
P48,110.00, for actual or compensatory damages, is not fully supported by
evidence. The records show that the total amount incurred for burial/funeral
expenses was P19,482.00, not P23,110.00.
Anent Mrs. Lopez' additional claim of P25,000.00 for the expenses incurred
during the two weeks wake for the victim, we find the said claim reasonable
considering the social standing of the Lopezes in the community. The Lopezes are
prominent in their place, not to mention they belong to a big family. (Mr. and Mrs.
Lopez sired 13 children, most of whom are professionals and gainfully
employed). The total award for actual damages should then be P44,482.00, and
not P48,110.00.
With respect to the claim for loss of earning capacity of the victim, we note that
the victim was already 69 years old at the time he was killed on November 24,
1985. His income as a dentist was P10,000.00 per month, or P120,000.00 per
annum. After deducting therefrom the necessary and incidental expenses which
the victim would have incurred if he were alive, the court a quo, declared that the
victim's annual net income would be P24,000.00. The trial court multiplied his
net annual income by his life expectancy of seven (7) years and two (2) months,
hence, P172,000.00 was awarded for loss of the earning capacity of the victim.
In computing the loss of the earning capacity of the victim, several factors are
considered besides the mathematical computation of annual income times life
expectancy. Allowances are made for circumstances which could reduce the
computed life expectancy of the victim, e.g., nature of work of the victim, his
lifestyle, age, and state of health prior to his death. In addition, we have to
consider the rate of loss sustained by the heirs of the victim. In this case, albeit
there was no evidence on the state of health of the victim, considering his
advanced age, we find it reasonable and fair to assume that he would not be able
work and earn, as a dentist, until he reaches the final moment of his life. Thus,
we reduce the award for loss of the earning capacity of the deceased to
P144,000.00, which is the approximate amount he would have earned until his
75th birthday.
WHEREFORE, premises considered, we AFFIRM WITH MODIFICATION the
assailed Decision, dated September 5, 1991, of the Regional Trial Court (Branch
XXXIII) of Bauang, La Union, in Criminal Case No. A-1540. Accordingly, the
indeminification granted in favor of the heirs of DR. GUILLERMO LOPEZ, are
modified as follows:
a) P50,000.00, for the death of Dr. Lopez;
b) P20,000.00, for moral damages;
c) P44,482.00, for actual expenses; and
d) P144,000.00, for loss of the earning capacity.
No costs.
SPOUSES TEODORO AND NANETTE PERENA, PETITIONERS, VS. SPOUSES
NICOLAS AND TERESITA L. ZARATE, PHILIPPINE NATIONAL RAILWAYS,
AND THE COURT OF APPEALS RESPONDENTS.
G.R. No. 157917, August 29, 2012, BERSAMIN, J.
The operator of a. school bus service is a common carrier in the eyes of the law. He
is bound to observe extraordinary diligence in the conduct of his business. He is
presumed to be negligent when death occurs to a passenger. His liability may
include indemnity for loss of earning capacity even if the deceased passenger may
only be an unemployed high school student at the time of the accident.
Facts:
The Pereñas were engaged in the business of transporting students from their
respective residences in Parañaque City to Don Bosco in Pasong Tamo, Makati
City, and back. In their business, the Pereñas used a KIA Ceres Van (van) with
Plate No. PYA 896, which had the capacity to transport 14 students at a time, two
of whom would be seated in the front beside the driver, and the others in the rear,
with six students on either side. They employed Clemente Alfaro (Alfaro) as
driver of the van.
In June 1996, the Zarates contracted the Pereñas to transport Aaron to and from
Don Bosco. On August 22, 1996, as on previous school days, the van picked Aaron
up around 6:00 a.m. from the Zarates' residence. Aaron took his place on the left
side of the van near the rear door. The van, with its air-conditioning unit turned
on and the stereo playing loudly, ultimately carried all the 14 student riders on
their way to Don Bosco. Considering that the students were due at Don Bosco by
7:15 a.m., and that they were already running late because of the heavy vehicular
traffic on the South Superhighway, Alfaro took the van to an alternate route at
about 6:45 a.m. by traversing the narrow path underneath the Magallanes
Interchange that was then commonly used by Makati-bound vehicles as a short
cut into Makati. At the time, the narrow path was marked by piles of construction
materials and parked passenger jeepneys, and the railroad crossing in the narrow
path had no railroad warning signs, or watchmen, or other responsible persons
manning the crossing. In fact, the bamboo barandilla was up, leaving the railroad
crossing open to traversing motorists.
At about the time the van was to traverse the railroad crossing, PNR Commuter
No. 302 (train), operated by Jhonny Alano (Alano), was in the vicinity of the
Magallanes Interchange travelling northbound. As the train neared the railroad
crossing, Alfaro drove the van eastward across the railroad tracks, closely tailing
a large passenger bus. His view of the oncoming train was blocked because he
overtook the passenger bus on its left side. The train blew its horn to warn
motorists of its approach. When the train was about 50 meters away from the
passenger bus and the van, Alano applied the ordinary brakes of the train. He
applied the emergency brakes only when he saw that a collision was imminent.
The passenger bus successfully crossed the railroad tracks, but the van driven by
Alfaro did not. The train hit the rear end of the van, and the impact threw nine of
the 12 students in the rear, including Aaron, out of the van. Aaron landed in the
path of the train, which dragged his body and severed his head, instantaneously
killing him. Alano fled the scene on board the train, and did not wait for the police
investigator to arrive.
Devastated by the early and unexpected death of Aaron, the Zarates commenced
this action for damages against Alfaro, the Pereñas, PNR and Alano. The Pereñas
and PNR filed their respective answers, with cross- claims against each other, but
Alfaro could not be served with summons.
The Zarates' claim against the Pereñas was upon breach of the contract of
carriage for the safe transport of Aaron; but that against PNR was based on quasi-
delict under Article 2176, Civil Code.
In their defense, the Pereñas adduced evidence to show that they had exercised
the diligence of a good father of the family in the selection and
supervision of Alfaro, by making sure that Alfaro had been issued a driver's
license and had not been involved in any vehicular accident prior to the collision;
that their own son had taken the van daily; and that Teodoro Pereña had
sometimes accompanied Alfaro in the van's trips transporting the students to
school.
For its part, PNR tended to show that the proximate cause of the collision had
been the reckless crossing of the van whose driver had not first stopped, looked
and listened; and that the narrow path traversed by the van had not been
intended to be a railroad crossing for motorists.
The RTC ruled in favor of plaintiff and against the defendants ordering them to
jointly and severally pay the former. On appeal, the CA promulgated its decision,
affirming the findings of the RTC, but limited the moral damages to
P2,500,000.00; and deleted the attorney's fees because the RTC did not state the
factual and legal bases.
The CA upheld the award for the loss of Aaron's earning capacity, taking
cognizance of the ruling in Cariaga v. Laguna Tayabas Bus Company and Manila
Railroad Company,[7] wherein the Court gave the heirs of Cariaga a sum
representing the loss of the deceased's earning capacity despite Cariaga being
only a medical student at the time of the fatal incident. Applying the formula
adopted in the American Expectancy Table of Mortality:
2/3 x (80 - age at the time of death) = life expectanc
the CA determined the life expectancy of Aaron to be 39.3 years upon reckoning
his life expectancy from age of 21 (the age when he would have graduated from
college and started working for his own livelihood) instead of 15 years (his age
when he died). Considering that the nature of his work and his salary at the time
of Aaron's death were unknown, it used the prevailing minimum wage of
P280.00/day to compute Aaron's gross annual salary to be P110,716.65,
inclusive of the thirteenth month pay. Multiplying this annual salary by Aaron's
life expectancy of 39.3 years, his gross income would aggregate to P4,351,164.30,
from which his estimated expenses in the sum of P2,189,664.30 was deducted to
finally arrive at P 2,161,500.00 as net income. Due to Aaron's computed net
income turning out to be higher than the amount claimed by the Zarates, only
P2,109,071.00, the amount expressly prayed for by them, was granted.
Issues:
1. Whether or not the Perenas and PNR are jointly and severally liable for
damages. (Yes)
2. Whether or not the indemnity for loss of Aaron’s earning capacity proper.
(Yes)
3. Whether or not the amount of damages are excessive. (No)
Ruling:
1.. The test by which to determine the existence of negligence in a particular case
has been aptly stated in the leading case of Picart v. Smith, thuswise:
The test by which to determine the existence of negligence in a particular
case may be stated as follows: Did the defendant in doing the alleged
negligent act use that reasonable care and caution which an
ordinarily prudent person would have used in the same situation?
If not, then he is guilty of negligence. The law here in effect adopts the
standard supposed to be supplied by the imaginary conduct of the
discreet paterfamilias of the Roman law. The existence of negligence in a
given case is not determined by reference to the personal judgment of
the actor in the situation before him. The law considers what would be
reckless, blameworthy, or negligent in the man of ordinary
intelligence and prudence and determines liability by that.
The question as to what would constitute the conduct of a prudent
man in a given situation must of course be always determined in the
light of human experience and in view of the facts involved in the
particular case. Abstract speculation cannot here be of much value but
this much can be profitably said: Reasonable men govern their
conduct by the circumstances which are before them or known to
them. They are not, and are not supposed to be, omniscient of the
future. Hence they can be expected to take care only when there is
something before them to suggest or warn of danger. Could a
prudent man, in the case under consideration, foresee harm as a result
of the course actually pursued? If so, it was the duty of the actor to take
precautions to guard against that harm. Reasonable foresight of harm,
followed by the ignoring of the suggestion born of this prevision, is
always necessary before negligence can be held to exist. Stated in
these terms, the proper criterion for determining the existence of
negligence in a given case is this: Conduct is said to be negligent when
a prudent man in the position of the tortfeasor would have foreseen
that an effect harmful to another was sufficiently probable to
warrant his foregoing the conduct or guarding against its
consequences.
Pursuant to the Picart v. Smith test of negligence, the Pereñas' driver was entirely
negligent when he traversed the railroad tracks at a point not allowed for a
motorist's crossing despite being fully aware of the grave harm to be thereby
caused to his passengers; and when he disregarded the foresight of harm to his
passengers by overtaking the bus on the left side as to leave himself blind to the
approach of the oncoming train that he knew was on the opposite side of the bus.
At any rate, the lower courts correctly held both the Pereñas and the PNR "jointly
and severally" liable for damages arising from the death of Aaron. They had been
impleaded in the same complaint as defendants against whom the Zarates had
the right to relief, whether jointly, severally, or in the alternative, in respect to or
arising out of the accident, and questions of fact and of law were common as to
the Zarates. Although the basis of the right to relief of the Zarates (i.e., breach of
contract of carriage) against the Pereñas was distinct from the basis of the
Zarates' right to relief against the PNR (i.e., quasi-delict under Article 2176, Civil
Code), they nonetheless could be held jointly and severally liable by virtue of their
respective negligence combining to cause the death of Aaron. As to the PNR, the
RTC rightly found the PNR also guilty of negligence despite the school van of the
Pereñas traversing the railroad tracks at a point not dedicated by the PNR as a
railroad crossing for pedestrians and motorists, because the PNR did not ensure
the safety of others through the placing of crossbars, signal lights, warning signs,
and other permanent safety barriers to prevent vehicles or pedestrians from
crossing there. The RTC observed that the fact that a crossing guard had been
assigned to man that point from 7 a.m. to 5 p.m. was a good indicium that the PNR
was aware of the risks to others as well as the need to control the vehicular and
other traffic there. Verily, the Pereñas and the PNR were joint tortfeasors.
2. The RTC awarded indemnity for loss of Aaron's earning capacity. Although
agreeing with the RTC on the liability, the CA modified the amount. Both lower
courts took into consideration that Aaron, while only a high school student, had
been enrolled in one of the reputable schools in the Philippines and that he had
been a normal and able-bodied child prior to his death. The basis for the
computation of Aaron's earning capacity was not what he would have become or
what he would have wanted to be if not for his untimely death, but the minimum
wage in effect at the time of his death. Moreover, the RTC's computation of
Aaron's life expectancy rate was not reckoned from his age of 15 years at the time
of his death, but on 21 years, his age when he would have graduated from college.
We find the considerations taken into account by the lower courts to be
reasonable and fully warranted.
Yet, the Pereñas submit that the indemnity for loss of earning capacity was
speculative and unfounded. They cited People v. Teehankee, Jr., where the Court
deleted the indemnity for victim Jussi Leino's loss of earning capacity as a pilot
for being speculative due to his having graduated from high school at the
International School in Manila only two years before the shooting, and was at the
time of the shooting only enrolled in the first semester at the Manila Aero Club to
pursue his ambition to become a professional pilot. That meant, according to the
Court, that he was for all intents and purposes only a high school graduate.
We reject the Pereñas' submission.
First of all, a careful perusal of the Teehankee, Jr. case shows that the situation
there of Jussi Leino was not akin to that of Aaron here. The CA and the RTC were
not speculating that Aaron would be some highly-paid professional, like a pilot
(or, for that matter, an engineer, a physician, or a lawyer). Instead, the
computation of Aaron's earning capacity was premised on him being a lowly
minimum wage earner despite his being then enrolled at a prestigious high
school like Don Bosco in Makati, a fact that would have likely ensured his success
in his later years in life and at work.
And, secondly, the fact that Aaron was then without a history of earnings should
not be taken against his parents and in favor of the defendants whose negligence
not only cost Aaron his life and his right to work and earn money, but also
deprived his parents of their right to his presence and his services as well. Our
law itself states that the loss of the earning capacity of the deceased shall be the
liability of the guilty party in favor of the heirs of the deceased, and shall in every
case be assessed and awarded by the court "unless the deceased on account of
permanent physical disability not caused by the defendant, had no earning
capacity at the time of his death."[38] Accordingly, we emphatically hold in favor
of the indemnification for Aaron's loss of earning capacity despite him having
been unemployed, because compensation of this nature is awarded not for loss
of time or earnings but for loss of the deceased's power or ability to earn money.
This favorable treatment of the Zarates' claim is not unprecedented. In Cariaga v.
Laguna Tayabas Bus Company and Manila Railroad Company, fourth-year medical
student Edgardo Carriaga's earning capacity, although he survived the accident
but his injuries rendered him permanently incapacitated, was computed to be
that of the physician that he dreamed to become. The Court considered his
scholastic record sufficient to justify the assumption that he could have finished
the medical course and would have passed the medical board examinations in
due time, and that he could have possibly earned a modest income as a medical
practitioner. Also, in People v. Sanchez, the Court opined that murder and rape
victim Eileen Sarmienta and murder victim Allan Gomez could have easily landed
good-paying jobs had they graduated in due time, and that their jobs would
probably pay them high monthly salaries from P10,000.00 to P15,000.00 upon
their graduation. Their earning capacities were computed at rates higher than the
minimum wage at the time of their deaths due to their being already senior
agriculture students of the University of the Philippines in Los Baños, the
country's leading educational institution in agriculture.
3.. The Pereñas plead for the reduction of the moral and exemplary damages
awarded to the Zarates in the respective amounts of P2,500,000.00 and
P1,000,000.00 on the ground that such amounts were excessive.
The plea is unwarranted.
The moral damages of P2,500,000.00 were really just and reasonable under the
established circumstances of this case because they were intended by the law to
assuage the Zarates' deep mental anguish over their son's unexpected and violent
death, and their moral shock over the senseless accident. That amount would not
be too much, considering that it would help the Zarates obtain the means,
diversions or amusements that would alleviate their suffering for the loss of their
child. At any rate, reducing the amount as excessive might prove to be an
injustice, given the passage of a long time from when their mental anguish was
inflicted on them on August 22, 1996
Anent the P1,000,000.00 allowed as exemplary damages, we should not reduce
the amount if only to render effective the desired example for the public good. As
a common carrier, the Pereñas needed to be vigorously reminded to observe their
duty to exercise extraordinary diligence to prevent a similarly senseless accident
from happening again. Only by an award of exemplary damages in that amount
would suffice to instill in them and others similarly situated like them the ever-
present need for greater and constant vigilance in the conduct of a business
imbued with public interest.
WHEREFORE, we DENY the petition for review on certiorari; AFFIRM the
decision promulgated on November 13, 2002; and ORDER the petitioners to pay
the costs of suit.
SO ORDERED.
CHAPTER IX: SCALE OF DAMAGES
A. Duty of Injured Party
B. Rules
a. In crimes
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. MAMERTO NARVAEZ,
defendant-appellant.
G.R. Nos. L-33466-67, EN BANC, April 20, 1983, MAKASIAR, J.:
FACTS:
It appears that this incident is intertwined with the long drawn out legal battle
between the Fleischer and Co., Inc. of which deceased Fleischer was the
secretary-treasurer and deceased Rubia the assistant manager, on the one hand,
and the land settlers of Cotabato, among whom was appellant.
Appellant was among those persons from northern and central Luzon who went
to Mindanao in 1937 and settled in Maitum, a former sitio of Kiamba and now a
separate municipality of South Cotabato. He established his residence therein,
built his house and cultivated the area. Shortly thereafter, Fleischer and
Company, headed by George W. Fleischer, an American landowner in Negros
Oriental, filed sales application No. 21983 on June 3, 1937 over the same area
formerly leased and later abandoned by Celebes Plantation Company. The 300
hectares set aside for the sales application of Fleischer and Company was
declared open for disposition, appraised and advertised for public auction. At the
public auction held in Manila on August 14, 1948, Fleischer and Company was the
only bidder for P6,000.00. But because of protests from the settlers the
corresponding award in its favor was held in abeyance, while an investigator was
sent by the Director of Lands to Kiamba in the person of Atty. Jose T. Gozon Atty.
Gozon came back after ten days with an amicable settlement signed by the
representative of the settlers. This amicable settlement was later repudiated by
the settlers, but the Director of Lands, acting upon the report of Atty. Gozon,
approved the same and ordered the formal award of the land in question to
Fleischer and Company.
On May 29, 1950, the settlers filed Civil Case No. 240 in the Court of First Instance
of Cotabato to annul the order awarding the land to the company. The RTC and
the CA affirmed the order.
This resulted in the ouster of the settlers by an order of the Court of First Instance
dated September 24, 1966, from the land which they had been occupying for
about 30 years. Among those ejected was the appellant who, to avoid trouble,
voluntarily dismantled his house, built in 1947 at a cost of around P20,000.00,
and transferred to his other house which he built in 1962 or 1963 near the
highway.
On November 14, 1966, appellant was among the settlers on whose behalf Jose V.
Gamboa and other leaders filed Civil Case No. 755 in the Court of First Instance
to obtain an injuction or annulment of the award. During the pendency of this
case, appellant on February 21, 1967 entered into a contract of lease with the
company. According to him, he signed the contract although the ownership of the ISSUE:
land was still uncertain, in order to avoid trouble, until the question of ownership
could be decided. He never paid the agreed rental, although he alleges that the
milling job they did for Rubia was considered payment.
Whether or not appellant’s conviction shall be upheld. (YES)

At about 2:30 p.m. on August 21, 1968, appellant who was taking a nap after
working on his farm all morning, was awakened by some noise as if the wall of RULING:
his house was being chiselled. Getting up and looking out of the window, he found
that one of the laborers of Fleischer was indeed chiselling the wall of his house.
The rest of the incident is narrated in the People's Brief:
The act of killing of the two deceased by appellant is not disputed. Appellant
admitted having shot them from the window of his house with the shotgun which
he surrendered to the police authorities. He claims, however, that he did so in
defense of his person and of his rights, and therefore he should be exempt from
criminal liability. Defense of one's person or rights is treated as a justifying
At about 2:30 in the afternoon of August 22, 1968, Graciano Juan, Jesus Verano circumstance under Art. 11, par. 1 of the Revised Penal Code, but in order for it
and Cesar Ibanez together with the two deceased Davis Fleischer and Flaviano to be appreciated, the following requisites must occur:
Rubia, were fencing the land of George Fleischer, father of deceased Davis
Fleischer. The place was in the boundary of the highway and the hacienda owned First. Unlawful aggression;
by George Fleischer. This is located in the municipality of Maitum, South
Cotabato. At the place of the fencing is the house and rice drier of appellant Second. Reasonable necessity of the means employed to prevent or repel it;
Mamerto Narvaez. At that time, appellant was taking his rest, but when he heard
Third. Lack of sufficient provocation on the part of the person defending himself
that the walls of his house were being chiselled, he arose and there he saw the
(Art. 11, par. 1, Revised Penal Code, as amended).
fencing going on. If the fencing would go on, appellant would be prevented from
getting into his house and the bodega of his ricemill. So he addressed the group,
The aggression referred to by appellant is the angry utterance by deceased
saying 'Pare, if possible you stop destroying my house and if possible we will talk
Fleischer of the following words: "Hindi, sigue, gademit, avante", in answer to his
it over what is good,' addressing the deceased Rubia, who is appellant's
request addressed to his compadre, the deceased Rubia, when he said, "Pare,
compadre. The deceased Fleischer, however, answered: 'No, gademit, proceed, go
hinto mona ninyo at pag-usapan natin kung ano ang mabuti" According to
ahead.' Appellant apparently lost his equilibrium and he got his gun and shot
appellant, Fleischer's remarks caused this reaction in him: "As if, I lost my senses
Fleischer, hitting him. As Fleischer fell down, Rubia ran towards the jeep, and
and unknowingly I took the gun on the bed and unknowingly also I shot Mr.
knowing there is a gun on the jeep, appellant fired at Rubia, likewise hitting him.
Fleischer, without realizing it, I shot Mr. Fleischer"
Both Fleischer and Rubia died as a result.

The actuation of deceased Fleischer in angrily ordering the continuance of the

Appellant now questions the propriety of his conviction.
fencing would have resulted in the further chiselling of the walls of appellant's
house as well as the closure of the access to and from his house and rice mill-
which were not only imminent but were actually in progress. There is no
question, therefore, that there was aggression on the part of the victims.
Fleischer had given him up to December 31, 1968 within which to vacate the land.
He should have allowed appellant the peaceful enjoyment of his properties up to
that time, instead of chiselling the walls of his house and closing appellant's
entrance and exit to the highway. The deceased had no right to destroy or cause
damage to appellant's house, nor to close his accessibility to the highway while
he was pleading with them to stop and talk things over with him. The assault on
appellant's property, therefore, amounts to unlawful aggression as contemplated
by law. The reasonableness of the resistance is also a requirement of the
justifying circumstance of self-defense or defense of one's rights under paragraph
1 of Article 11, Revised Penal Code. When the appellant fired his shotgun from his
window, killing his two victims, his resistance was disproportionate to the attack.
WE find, however, that the third element of defense of property is present, i.e.,
lack of sufficient provocation on the part of appellant who was defending his
property. Be that as it may, appellant's act in killing the deceased was not
justifiable, since not all the elements for justification are present. He should
therefore be held responsible for the death of his victims, but he could be credited
with the special mitigating circumstance of incomplete defense. the trial court
has properly appreciated the presence of the mitigating circumstance of
voluntary surrender, it appearing that appellant surrendered to the authorities
soon after the shooting. Likewise, We find that passion and obfuscation attended
the commission of the crime.
The civil liability of the appellant should be modified. In the case of Zulueta vs.
Pan American World Airways (43 SCRA 397), the award for moral damages was
reduced because the plaintiff contributed to the gravity of defendant's reaction.
In the case at bar, the victims not only contributed but they actually provoked the
attack by damaging appellant's properties and business. Considering appellant's
standing in the community, being married to a municipal councilor, the victims'
actuations were apparently designed to humiliate him and destroy his
reputation. Moreover, these cases arose out of an inordinate desire on the part of
Fleischer and Company, despite its extensive landholdings in a Central Visayan
province, to extend its accumulation of public lands to the resettlement areas of
Cotabato. Thus, the moral and material suffering of appellant and his family
deserves leniency as to his civil liability.
Furthermore, Article 39 of the Revised Penal Code requires a person convicted of
prision correccional or arrests mayor and fine who has no property with which
to meet his civil liabilities to serve a subsidiary imprisonment at the rate of one
(1) day for each P 2.50. However, the amendment introduced by Republic Act No.
5465 on April 21, 1969 made the provisions of Art. 39 applicable to fines only and
not to reparation of the damage caused, indemnification of consequential
damages and costs of proceedings. Considering that Republic Act 5465 is
favorable to the accused who is not a habitual delinquent, it may be given
retroactive effect pursuant to Article 22 of the Revised Penal Code.
DISPOSITIVE PORTION:
WHEREFORE, FINDING APPELLANT GUILTY BEYOND REASONABLE DOUBT OF
ONLY TWO (2) HOMICIDES, MITIGATED BY THE PRIVILEGED EXTENUATING
CIRCUMSTANCE OF INCOMPLETE SELF-DEFENSE AS WELL AS BY TWO (2)
GENERIC MITIGATING CIRCUMSTANCES OF VOLUNTARY SURRENDER AND
OBFUSCATION, WITHOUT ANY AGGRAVATING CIRCUMSTANCE, APPELLANT IS
HEREBY SENTENCED TO SUFFER AN IMPRISONMENT OF FOUR (4) MONTHS OF
ARRESTO MAYOR, TO INDEMNIFY EACH GROUP OF HEIRS OF DAVIS FLEISCHER
AND OF FLAVIANO RUBIA IN THE SUM OF FOUR THOUSAND (P 4,000.00) PESOS,
WITHOUT SUBSIDIARY IMPRISONMENT AND WITHOUT ANY AWARD FOR
MORAL DAMAGES AND ATTORNEY'S FEES.
CONSIDERING THAT APPELLANT HAS BEEN UNDER DETENTION FOR ALMOST
FOURTEEN (14) YEARS NOW SINCE HIS VOLUNTARY SURRENDER ON AUGUST
22,1968, HIS IMMEDIATE RELEASE IS HEREBY ORDERED. NO COSTS.
SO ORDERED.
b. In quasi-delict
G.R. No. 88561 April 20, 1990
DR. HERMAN ARMOVIT, DORA ARMOVIT and JACQUELINE ARMOVIT,
petitioners,
vs.
COURT OF APPEALS, and NORTHWEST AIRLINES, INC., respondents.
Facts:
This is a case which involves a Filipino physician and his family residing in the
United States who came home to the Philippines on a Christmas visit. They were
bumped off at the Manila International Airport on their return flight to the U.S.
because of an erroneous entry in their plane tickets relating to their time of
departure.
In October 1981, the petitioners decided to spend their Christmas holidays with
relatives and friends in the Philippines, so they purchased from private
respondent, (Northwest Airlines, Inc.) three (3) round trip airline tickets from
the U.S. to Manila and back, plus three (3) tickets for the rest of the children,
though not involved in the suit. Each ticket of the petitioners which was in the
handwriting of private respondent's tickets sales agent contains the following
entry on the Manila to Tokyo portion of the return flight:
from Manila to Tokyo, NW flight 002, date 17 January, time 10:30 A.M.
Status, OK.
On their return trip from Manila to the U.S, petitioner arrived at the check-in
counter of private respondent at the Manila International Airport at 9:15 in the
morning, which is a good one (1) hour and fifteen (15) minutes ahead of the 10:30
A.M. scheduled flight time recited in their tickets. Petitioners were rudely
informed that they cannot be accommodated inasmuch as Flight 002 scheduled
at 9:15 a.m. was already taking off and the 10:30 A.M. flight time entered in their
plane tickets was erroneous.
Previous to the said date of departure petitioners re-confirmed their
reservations through their representative Ernesto Madriaga who personally
presented the three (3) tickets at the private respondent's Roxas Boulevard
office. 2 The departure time s was not changed when re-confirmed.
Herein petitioner Dr. Armovit protested in extreme agitation that because of the
bump-off he will not be able to keep his appointments with his patients in the U.S.
Petitioners suffered anguish, wounded feelings, and serious anxiety day and
night of January 17th until the morning of January 18th when they were finally
informed that seats will be available for them on the flight that day.Because of the
refusal of the private respondent to heed the repeated demands of the petitioners
for compensatory damages arising from the aforesaid breach of their air-
transport contracts, petitioners were compelled to file an action for damages in
the Regional Trial Court of Manila.
The trial court ordered defendant to pay plaintiffs actual, moral, exemplary and
nominal damages, plus attorney's fees,
Not satisfied therewith, private respondent interposed an appeal to the Court of
Appeals wherein in due course a decision. The relevant portion and dispositive
part of which read as follows:
Plaintiffs-appellees had complied with the "72-hour reconfirmation rule." They
had obtained reconfirmation from defendant-appellant of the time and date of
their flight, as indicated in their tickets. The trial court said so and We find
nothing significance to warrant a disturbance of such finding.
On the allowance of damages, the trial court has discretion to grant and fix the
amounts to be paid the prevailing party. In this case, there was gross negligence
on the part of defendant-appellant in reconfirming the time and date of departure
of Flight No. 002 as indicated in the three (3) tickets . And, as admitted by
defendant-appellant, plaintiffs-appellees had arrived at the airport at 9:15 A.M.
or one (1) hour before departure time of 10:30 A.M.
Appellees' actual damages in the amount of P1,300.00 is maintained for being
unrebutted by the Appellant.
However, We modify the allowance of the other awards made by the trial court.
The moral damages of P900,000.00 awarded to Appellees must be eliminated
considering the following:
1. That the appellees did not take the witness stand to testify on their "social
humiliation, wounded feelings and anxiety" and the breach of contract was not
malicious or fraudulent. (Art. 2220, Civil Code). It has been held that:
Nor was there error in the appealed decision in denying moral damages, not only
on account of the plaintiffs failure to take the witness stand and testify to her
social humiliation, wounded feelings, anxiety, etc., as the decision holds, but
primarily because a breach of contract like that of defendant not being malicious
or fraudulent, does not warrant the award of moral damages under Article 2220
of the Civil Code (Ventilla vs. Centeno, L-14333, 28 Jan. 1961; Fores vs. Miranda,
L-12163; 4 March 1959 Francisco vs. GSIS, 7 SCRA 577).
2. Furthermore, moral damages, though incapable of pecuniary estimation, are in
the category of an award designed to compensate the claimant for actual injury
suffered and not to impose a penalty on the wrongdoer (San Andres vs. Court of
Appeals, 116 SCRA 85). In a later case, the Supreme Court held that moral
damages are emphatically not intended to enrich a complainant at the expense of
the defendant (R & B Surety vs. IAC, 129 SCRA 745) citing Grand Union
Supermarket, Inc. vs. Espino, Jr. 94 SCRA 966).
However, there is no question that appellant acted with negligence in not
informing appellees about the change of hour of departure. To provide an
example or correction for the public good, therefore, the award of exemplary
damages is proper (Art. 2229 & 2231 Civil Code; Lopez v. Pan American World
Airways, 16 SCRA 431; Prudenciado vs. Alliance Transport, 148 SCRA 440).
Nonetheless, the awards granted by the trial court are far too exhorbitant and
excessive compared to the actual loss of P1,300.00. The authority of the Court of
Appeals to modify or change the amounts of awards has been upheld in a long
line of decisions. We reduce the award of exemplary damages from P500,000.00
to P100,000.00 in favor of Dr. Herman Armovit, from P500,000.00 to P50,000.00
in favor of Mrs. Dora Armovit; and from P300,000.00 to P20,000.00 in favor of
Miss Jacqueline Armovit. (Gellada vs. Warner Barnes, 57 O.G. (4) 7347, Sadie vs.
Bachrach, 57 O.G. (4) 636, Prudenciado vs. Alliance Transport, supra). The award
of nominal damages has to be eliminated since we are already awarding
actual loss. Nominal damages cannot co-exist with actual or compensatory
damages (Vda. de Medina, et al. v. Cresencia, et al., 99 Phil. 506).
The award of 5% of the total damages as attorney's fees is reasonable.
Issue:
WON the CA erred in the award
Ruling:
YES. The petition is impressed with merit.
The appellate court observed that private respondent was guilty of gross
negligence not only in the issuance of the tickets by the erroneous entry of the
date of departure and without changing or correcting the error when the said
three (3) tickets were presented for re-confirmation. Nevertheless it deleted the
award of moral damages on the ground that petitioners did not take the witness
stand to testify on "their social humiliation, wounded feelings and anxiety, and
that the breach of contract was not malicious or fraudulent."
We disagree.
In Air France vs. Carrascoso, 9 Lopez vs. Pan American World Airways, 10 and
Zulueta vs. Pan American World Airways, this Court awarded damages for the
gross negligence of the airline which amounted to malice and bad faith and which
tainted the breach of air transportation contract.
Thus in Air France, this Court observed:
A contract to transport passengers is quite different in kind and degree
from any other contractual relation. And this, because of the relation
which an air carrier sustains with the public. Its business is mainly with
the traveling public. It invites people to avail of the comforts and
advantages it offers. The contract of air carriage, therefore, generates a
relation attended with a public duty. Neglect or malfeasance of the
carrier's employees, naturally, could give ground for an action for
damages.
Passengers do not contract merely for transportation. They have the
right to be treated by the carrier's employees with kindness, respect,
courtesy and due consideration. They are entitled to be protected
against personal misconduct, injurious language, indignities and abuses
from such employees. So it is, that any rude or discourteous conduct on
the part of employees towards a passenger gives the latter an action for
damages against the carrier.
The gross negligence committed by private respondent in the issuance of the
tickets with entries as to the time of the flight, the failure to correct such
erroneous entries and the manner by which petitioners were rudely informed
that they were bumped off are clear indicia of such malice and bad faith and
establish that private respondent committed a breach of contract which entitles
petitioners to moral damages.
The appellate court observed that the petitioners failed to take the witness stand
and testify on the matter.1âwphi1 It overlooked however, that the failure of the
petitioner to appear in court to testify was explained by them. The assassination
of Senator Benigno Aquino, Jr. on August 21, 1983 following the year they were
bumped off caused a turmoil in the country. This turmoil spilled over to the year
1984 when they were scheduled to testify. However, the violent demonstrations
in the country were sensationalized in the U.S. media so petitioners were advised
to refrain from returning to the Philippines at the time.
Nevertheless, Atty. Raymund Armovit, brother of petitioner Dr. Armovit, took the
witness stand as he was with the petitioners from the time they checked in up to
the time of their ultimate departure. He was a witness when the check-in officer
rudely informed the petitioners that their flight had already taken off, while
petitioner Dr. Armovit remonstrated that their tickets reflected their flight time
to be 10:30 A.M.; that in anger and frustration, Dr. Armovit told the said check-
in-officer that he had to be accommodated that morning so that he could attend
to all his appointments in the U.S.; that petitioner Jacqueline Armovit also
complained about not being able to report for work at the expiration of her leave
of absence; that while petitioner had to accept private respondent's offer for hotel
accommodations at the Philippine Village Hotel so that they could follow up and
wait for their flight out of Manila the following day, petitioners did not use their
meal coupons supplied because of the limitations thereon so they had to spend
for lunch, dinner, and breakfast in the sum of P1,300.00 while waiting to be flown
out of Manila; that Dr. Armovit had to forego the professional fees for the medical
appointments he missed due to his inability to take the January 17 flight; that the
petitioners were finally able to fly out of Manila on January 18, 1982, but were
assured of this flight only on the very morning of that day, so that they
experienced anxiety until they were assured seats for that flight.
No doubt Atty. Raymund Armovit's testimony adequately and sufficiently
established the serious anxiety, wounded feelings and social humiliation that
petitioners suffered upon having been bumped off. However, considering the
circumstances of this case whereby the private respondent attended to the plight
of the petitioners, taking care of their accommodations while waiting and
boarding them in the flight back to the U.S. the following day, the Court finds that
the petitioners are entitled to moral damages in the amount of P100,000.00 each.
By the same token to provide an example for the public good, an award of
exemplary damages is also proper. The award of the appellate court is adequate.
Nevertheless, the deletion of the nominal damages by the appellate court is
well-taken since there is an award of actual damages. Nominal damages
cannot co-exist with actual or compensatory damages.
WHEREFORE, the petition is GRANTED. The questioned judgment of the Court of
Appeals is hereby modified such that private respondent shall pay the following:
(a) actual damages in favor of Dr. Armovit in the sum of P1,300.00 with interest
at the legal rate from January 17, 1982;
(b) moral damages at P100,000.00 and exemplary damages and P100,000.00 in
favor of Dr. Armovit;
(c) moral damages of P100,000.00 and exemplary damages of P50,000.00 in
favor of Mrs. Dora Armovit;
(d) moral damages of P100,000.00 and exemplary damages in the amount of
P20,000.00 in favor of Miss Jacqueline Armovit; and
(e) attorney's fees at 5% of the total awards under the above paragraphs, plus the
cost of suit.
SO ORDERED.
MISCELLANEOUS RULES AND JURISPRUDENCE
D. Jurisdiction on damages in Labor Cases
NICASIO P. RODRIGUEZ JR., ANTONIO P. EREÑETA, JUANITO A. MAGNO,
VICTOR C. PINEDA, BITUIN V. SALCEDO, CESAR R. SAN DIEGO, VICTOR V.
TANTOCO and AMADOR C. DE LA MERCED, Petitioners, v. ANTONIO L.
AGUILAR SR., Respondent.
G.R. NO. 159482, THIRD DIVISION, August 30, 2005, PANGANIBAN, J.
FACTS: Petitioners are members of the Board of Directors of Philippine Postal
Savings Bank, Inc. (PPSBI) at Liwasang Bonifacio, Manila; private respondent
Antonio L. Aguilar was employed as Vice President of its Finance and
Administrative Group from February 14, 2000 to January 31, 2001, and
thereafter as Compliance Officer until September 26, 2001 when his services
were terminated.
On October 25, 2001, private respondent filed a complaint against petitioners
with the RTC of Manila alleging that he was illegally dismissed by the petitioners
in an oppressive way; that the cause of his dismissal was his principled act of
exposing anomalies in the bank; that considering the seriousness of the violations
of internal control and bank policies, there is a need to prohibit petitioners from
performing their functions as members of the Board in their own personal
capacity. He prayed for the award of damages, the issuance of a temporary
restraining order enjoining the petitioners from dismissing him or in the
alternative, to immediately reinstate him, and the prohibition of the petitioners
from performing their personal and official acts in the bank.
Public respondent Judge motu proprio dismissed the complaint for lack of
jurisdiction stating that jurisdiction over the case lies with the Labor Arbiter of
the National Labor Relations Commission.
Unaware of the dismissal, petitioners filed a Motion to Dismiss private
respondent's complaint on the ground of the RTC's lack of jurisdiction over the
subject matter of the complaint.
Private respondent filed a Motion for Reconsideration. However, he filed an Ex-
Parte Motion to Withdraw Motion For Reconsideration of the Dismissal Order
and In Lieu Thereof to Submit Amended Complaint, which was attached thereto.
In his Amended Complaint, he emphasized that his dismissal was done in a very
oppressive manner. His prayer for reinstatement was deleted.
Public respondent Judge admitted the Amended Complaint reasoning that
amendment was a matter of right before defendants filed a responsive pleading,
the motion to dismiss not being a responsive pleading.
Respondent filed a Motion to Declare Defendants As in Default and For Judgment
On the Pleadings grounded on petitioners' failure to file their Answer within the
additional ten (10)-day period granted by the court. Public respondent granted
respondent's motion and declared defendants-petitioners in default.
Public respondent issued the assailed decision (Judgment by Default) in favor of
the private respondent.
Petitioners filed before the CA a Petition for Certiorari under Rule 65, challenging
the decision of the RTC. Petitioners prayed that "the lower court's judgment by
default, as well as said court's all other orders and findings after its Order of
dismissal of the original Complaint, be reversed and set aside, and that the case
in question be dismissed for lack of jurisdiction and for having been decided in
violation of the Rules.
Agreeing with the RTC, the CA held that the withdrawal of the Motion for
Reconsideration filed by respondent had not resulted in the finality of the
Dismissal Order, since he had simultaneously amended his Complaint. This he
had every right to do, said the CA, because no responsive pleading had yet been
filed by petitioners. It opined that the Amended Complaint superseded his
original Complaint and mooted the issue raised in his Motion for
Reconsideration. The CA likewise ruled that the RTC had jurisdiction over the
case, because of the civil nature of the cause of action; that is, the alleged
oppressive manner of respondent's dismissal that had resulted in damages.
ISSUES: Whether or not the RTC has jurisdiction over the case.
RULING: NO. Under Article 217(a) of the Labor Code, as amended by Republic
Act No. 6715 which took effect on March 21, 1989, labor arbiters shall have
"original and exclusive jurisdiction to hear and decide: claims for actual, moral,
exemplary and other forms of damages arising from the employer-employee
relations x x x."
Clearly, in the case before us, respondent's claim for damages against petitioners
arose from a prior employer-employee relationship. The averments in the
Complaint indisputably show that his claim for damages was anchored on and
was a consequence of the termination of his employment with PPSBI.
The trial court should have dismissed the Amended Complaint. With regard to
claims for damages under paragraph 4 of Article 217, quoted above,
jurisprudence has applied the "reasonable connection rule": if there is a
reasonable causal connection between the claim asserted and the
employer-employee relations, then the case falls within the jurisdiction of
the labor arbiter. We do not agree with the trial court that the case became
a civil dispute simply because respondent had not asked for reinstatement
in his Amended Complaint. An employee need not seek reinstatement in
order to have a complaint heard by the labor arbiter.
The Court is aware that the Civil Code provisions on human relations and
damages may be used as bases for justifying his claim. But, the fact remains: the
present action primarily involves an employer-employee relationship. The
damages he incurred are mere consequences of the alleged injury brought about
by his perceived illegal dismissal. The civil ramifications of his actual claim
cannot alter the reality that it is primordially a labor matter cognizable by the
labor tribunals.
Under Article 217 (a) of the Labor Code, the labor arbiter has the jurisdiction to
award to a dismissed employee not only the reliefs provided by the Labor Code,
but also moral and other forms of damages governed by the Civil Code. Although
a dismissal from employment may be a violation not only of the Labor but also of
the Civil Code, an illegally dismissed employee has only a single cause of action.
Moral damages are recoverable when, for example, the dismissal was effected
without an authorized cause and/or due process - - for which relief is granted by
the Labor Code - - and also when the dismissal (1) was attended by bad faith or
fraud; (2) constituted an act oppressive to labor; or (3) was done in a manner
contrary to morals, good customs or public policy. For any of these, the obtainable
relief is determined by the Civil Code.
Hence, for a single cause of action, the dismissed employee cannot be allowed to
sue in two forums: one, before the labor arbiter for reinstatement and recovery
of back wages or for separation pay, upon the theory that the dismissal was
illegal; and two, before a court of justice for recovery of moral and other damages,
upon the theory that the manner of dismissal was unduly injurious or tortious.
Suing in the manner described is known as "splitting a cause of action," a practice
engendering a multiplicity of actions. It is considered procedurally unsound and
obnoxious to the orderly administration of justice.
Presently, as amended by RA 6715, the jurisdiction of the NLRC under Article 217
of the Labor Code is comprehensive enough to include claims for all forms of
damages arising from the employer-employee relations.
DISPOSITIVE PORTION:
WHEREFORE, the Petition is GRANTED , and the assailed Decision REVERSED
and SET ASIDE. The Amended Complaint in Civil Case No. 01102147, filed with
the Regional Trial Court (Branch 49) of the City of Manila, is hereby DISMISSED.
No pronouncement as to costs. SO ORDERED.
LORENZO MA. D.G. AGUILAR, petitioner, vs. BURGER MACHINE HOLDINGS
CORPORATION, OSCAR E. RODRIGUEZ and MELCHOR V. DE JESUS, JR.,
respondents. | G.R. No. 172062, FIRST DIVISION, October 30, 2006,
YNARES-SANTIAGO, J.
FACTS:
Respondent Burger Machine Holdings Corporation (Burger Machine) is a
domestic corporation engaged in the business of food service. Respondents
Caesar B. Rodriguez, Fe Esperanza S. Rodriguez, and Melchor V. De Jesus, Jr., (De
Jesus) are Burger Machine’s Chairperson, President, and Vice-President,
respectively.
Burger Machine hired petitioner as a Strategic Business Unit Manager Trainee.
He was regularized and assigned as Profit Center Manager of the Burger Machine
North Corporation (BMNC) and the overseer of the Central Luzon Food
Corporation (CLFC) and the Eastern Luzon Food Corporation (ELFC). He was
likewise tasked to spearhead the expansion of their outlets in Baguio City.
On October 9, 2001, however, Burger Machine released the results of the audit of
BMNC’s operation showing that petitioner had not complied with the company’s
purchasing system policy manual and that he made several purchases, the
amounts of which were beyond his authority to approve. In reply thereto,
petitioner attributed the lapses in the approval of purchases to the lack of
information on the standard operating procedures of the company.
Thereafter, De Jesus directed petitioner to cease from overseeing the CLFC and
ELFC and to concentrate on BMNC “to resolve faster all critical problems such as
shortages, low ADS, low promo compliance, etc.” On November 19, 2001, De Jesus
ordered him to reduce his gross sales shortages to 1% or less by the end of
November 2001. Petitioner was able to reduce this shortage to as low as 0.86%
for the month of November.
At the end of the year 2001, petitioner did not receive his 14th month pay bonus
of P35,000.00 while the amount of P15,291.00 representing the alleged
unauthorized expenses was deducted from his salary.
On March 7, 2002, De Jesus ordered petitioner to turn over BMNC to Ms. Gloria
Centino “starting March 12 up to the end of March.” No reason was stated in the
directive, neither was a new assignment given to petitioner, thus he wrote a letter
to respondent Caesar B. Rodriguez, seeking an explanation for the actions of De
Jesus.
On April 23, 2002, petitioner was appointed as Profit Center Manager of Tatyana
Foods Corporation (TFC), a new project of Burger Machine to be established in
La Union, Ilocos Sur, Ilocos Norte, Cagayan and Isabela. Petitioner accepted the
appointment.
On May 14, 2002, De Jesus informed petitioner that he would instead be
transferred to the National Capital Region (NCR) to oversee the operations of the
People’s Dimsum (PD). On May 17, 2002, petitioner figured in an accident while
on his way to De Jesus’ office in Metro Manila. He was thus hospitalized and was
constrained to go on leave. He requested for cash advance and financial
assistance from the company for his medical expenses but was denied.
On July 17, 2002, petitioner filed a complaint for constructive dismissal
contending that the totality of respondents’ conduct constitutes harassment
aimed to pressure him to resign from his job. Respondents, on the other hand,
alleged that the transfer of the BMNC operations to Centino was due to
petitioner’s repeated failure to achieve the passing rate for quality food service
control; that despite of this gross inefficiency, he was given a new assignment;
that the delay in assigning him to a new Profit Center was due to his irregular
attendance; that he was not able to assume his responsibility as Profit Center
Manager of TFC because of his failure to go back to work and his unreasonable
demands; and that petitioner’s continued absence prompted them to assign him
at the EDSA office starting July 17, 2002.
The Labor Arbiter ruled that petitioner was constructively dismissed and that
respondent corporate officials of Burger Machine are solidarily liable with the
latter for petitioner’s monetary awards. In addition respondents, are solidarily
ordered to pay complainant his 14th month pay for 2002; P500,000.00 as moral
damages; P350,000.00 as exemplary damages; and 10% of the money awards for
and as attorney’s fees.
The foregoing decision was affirmed by the NLRC.
On petition to the Court of Appeals, the latter reversed the finding of the NLRC
and held that there was no constructive dismissal because petitioner’s transfer
to PD was without change in rank and salary and was not shown to be humiliating
and prejudicial to petitioner.
Hence, the instant petition.
ISSUE/S:
Whether or not petitioner was constructively dismissed. (YES)
Whether or not petitioner is entitled to moral and exemplary damages. (YES)
RULING:
Whether or not petitioner was constructively dismissed.
YES.
Constructive dismissal exists as an involuntary resignation on the part of the
employee due to the harsh, hostile and unfavorable conditions set by the
employer. In other words, it is an act amounting to dismissal but made to appear
as if it were not. In fact, the employee who is constructively dismissed may be
allowed to keep on coming to work. Constructive dismissal is therefore a
dismissal in disguise. It is brought about where there is clear discrimination,
insensibility or disdain by an employer and this becomes unbearable to the
employee. The law recognizes and resolves this situation in favor of employees
in order to protect their rights and interests from the coercive acts of the
employer. Whereas valid termination by the employee under Art. 285 of the
Labor Code contemplates such act to be voluntary, an employee who is forced to
relinquish the position held through the employer’s unfair or unreasonable acts
is deemed to have been illegally terminated or discharged, as such the
termination is implied to be involuntary.
In constructive dismissal cases, the employer has the burden of proving that its
conduct and action or the transfer of an employee are for valid and legitimate
grounds such as genuine business necessity.
In the instant case, Burger Machine failed to discharge this burden. The labor
tribunals below correctly found that the combination of the harsh actions of
respondents rendered the employment condition of petitioner hostile and
unbearable for the following reasons:
First, in the March 7, 2002 Memorandum of De Jesus, no reason was stated why
petitioner was directed to turn over BMNC to Centino. Note that the same
Memorandum did not inform petitioner of his next assignment thereby placing
him in a floating status. Burger Machine belatedly claimed in its position paper
that petitioner was relieved of his position because of gross inefficiency. This
omission of the company is a trespass not only of petitioner’s due process rights
but also of the basic respect and professional courtesy due him as an employee.
Second, the constant pressure of De Jesus for him to quit his job rendered his
employment with Burger Machine unbearable.
Third, Burger Machine made an unauthorized deduction on petitioner’s salary
representing the alleged expenses incurred without authority.
Fourth, petitioner was subsequently appointed as Profit Center Manager of the
TFC but Burger Machine recalled said appointment, again, without stating the
reason therefor, and worse without serving him any formal memorandum
withdrawing the appointment.
Fifth, he was offered an assignment in the NCR, specifically as Profit Center
Manager of the PD but not actually appointed as such.
Based on the factual considerations in the instant case, the Court hold that the
hostile and unreasonable working conditions of petitioner justified the finding of
the Labor Arbiter and the NLRC that petitioner was constructively dismissed.
Petitioner’s performance may not have been exceptional but he was certainly not
grossly inefficient as Burger Machine pictured him to be. In fact, he received
several citations and was able to comply with the directive to reduce his
shortages for the month of November 2001. From all indications, there is really
no ground to dismiss petitioner for gross inefficiency. And, as Burger Machine
saw it, the only way to get rid of the latter was to constructively dismiss him.
Whether or not petitioner is entitled to moral and exemplary damages.
YES.
Moral damages may be recovered only where the dismissal of the employee was
tainted by bad faith or fraud, or where it constituted an act oppressive to labor,
and done in a manner contrary to morals, good customs, or public policy while
exemplary damages are recoverable only if the dismissal was done in a wanton,
oppressive, or malevolent manner. These damages, however, are not intended to
enrich petitioner and should therefore be reduced to P50,000.00 each.
The award of 14th month pay must be deleted. Since the payment thereof is not
required by law, substantial evidence showing that Burger Machine has the
customary practice to give the same to its employees, is necessary. This,
petitioner failed to satisfy.
The award of attorney’s fees is sustained based on Article 111 of the Labor Code,
Section 8, Rule VIII, Book III of its Implementing Rules, and paragraph 7, Article
2208 of the Civil Code. In actions for recovery of wages or where an employee
was forced to litigate and thus incurred expenses to protect his rights and
interests, a maximum of ten percent (10%) of the total monetary award by way
of attorney’s fees is justifiable.
DISPOSITIVE PORTION:
WHEREFORE, the December 20, 2005 Decision of the Court of Appeals in CA-G.R.
SP No. 87910 is REVERSED and SET ASIDE. The May 27, 2003 Decision of the
Labor Arbiter finding that petitioner was constructively dismissed, is
REINSTATED with the following MODIFICATIONS: (a) Respondents Caesar B.
Rodriguez and Fe Esperanza B. Rodriguez are absolved from personal liability;
(b) the award of 14th month pay is deleted; and (c) the awards of moral and
exemplary damages are reduced to P50,000.00 each. SO ORDERED.
- SAB
E. Meaning of Damages in Ejectment of Cases
REYNALDO VILLAFUERTE and PERLITA T. VILLAFUERTE, petitioners, vs.
HON. COURT OF APPEALS, EDILBERTO DE MESA and GONZALO DALEON,
respondents.
G.R. No. 134239, SECOND DIVISION, May 26, 2005, CHICO-NAZARIO, J.
FACTS:
Spouses Reynaldo C. Villafuerte and Perlita Tan-Villafuerte operated a gasoline
station known as Peewees Petron Powerhouse Service Station and General
Merchandise on the premises of three (3) adjoining lots at the corner of Gomez
Street and Quezon Avenue in Lucena City. One of these lots, is owned by several
persons namely, Edilberto de Mesa, Gonzalo Daleon and his brother Federico A.
Daleon and Mrs. Anicia Yap-Tan, mother of appellee Perlita Tan-Villafuerte.
Appellants Edilberto de Mesa and Gonzalo Daleon acquired their respective lots
subject to the lease by Petrophil Corporation which had built thereon the gasoline
station being managed by the Villafuerte couple. When the lease of Petrophil
Corporation expired, the Villafuertes obtained a new lease on the lot of Edilberto
de Mesa.
As regards the lot of Daleon brothers, the Villafuertes were not as lucky. For,
instead of obtaining a lease renewal, what they received were demand letters
from the brothers counsel ordering them to vacate the premises. Instead of
complying therewith, the Villafuertes simply ignored the demand and continued
operating the gas station.
Gonzalo Daleon filed a complaint against the Villafuertes in the Office of the
Barangay Captain of Barangay Tres, Lucena City. No settlement was reached.
Villafuertes, upon expiration of lease contract with Edilberto de Mesa, the same
was not renewed. The spouses continued to operate their gasoline station and
other businesses on the lot of de Mesa despite the latters demand to vacate.
Edilberto de Mesa and Gonzalo Daleon, with the aid of several persons and
without the knowledge of the Villafuertes, caused the closure of the latters
gasoline station by constructing fences around it. Villafuertes countered with a
complaint for damages with preliminary mandatory injunction against both
Edilberto de Mesa and Gonzalo Daleon.
The complaint seeks vindication for the alleged malicious and unlawful fencing
of the plaintiffs’ business premises.
ISSUE: Whether Petitioners are entitled to Damages.
RULING:
Both the trial court and the Court of Appeals concluded that the lease contracts
between petitioners and private respondents over the latter's respective lots had
already expired. There was also a congruence of findings that it was wrong for
private respondents to fence their properties thereby putting to a halt the
operation of petitioners' gasoline station. To this, we agree.
Petitioners instituted this action praying that private respondents be held liable
for actual damages, moral damages, exemplary damages, attorney's fees, and
costs of litigation. We shall resolve their right to these damages in seriatim.
RE: ACTUAL DAMAGES – denied
Petitioners relied solely on their own assessment of the prices of these items as
well as the damage thereto purportedly occasioned by the fencing of the gasoline
station. This is clearly demonstrated by the inconsistent stance of petitioner
Pertlita with regard to the percentage of damaged merchandise stored in the
gasoline station
A court cannot simply rely on speculation, conjecture or guesswork as to the fact
and amount of damages, but is required to depend upon competent proof that the
claimant had suffered and on evidence of the actual amount thereof. Failing in
this regard, we resolve to delete the award of actual damages rendered by the
Court of Appeals with respect to these items.
RE: TEMPERATE DAMAGES – allowed
We find, however, that an award of temperate damages to petitioners is in order.
In lieu of actual damages, temperate damages, which are more than nominal but
less than compensatory damages, may be awarded where the court finds that
some pecuniary loss had been suffered by the claimant but its amount cannot be
proved with certainty. Undoubtedly, pecuniary loss had been inflicted upon
petitioners in this case, however, due to the insufficiency of evidence before us,
we cannot place its amount with certainty. In this regard, we find the amount of
P50,000.00 to be sufficient.
RE: MORAL DAMAGES - denied
The Court must have to disallow the lower court's award of moral damages. The
concept of moral damages, as announced in Article 2217 of the Civil Code, is
designed to compensate the complainant for his physical suffering, mental
anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral
shock, social humiliation and similar injury occasioned by the defendant's
wrongful act or omission. Noticeably, none of the foregoing instances has any
relevant bearing to the case at bench.
RE: EXEMPLARY DAMAGES – allowed
Similarly, we uphold the award of P50,000.00 as exemplary damages in order to
deter similarly minded individuals from pursuing the course of action taken by
private respondents. The law on this matter is clear: "(h)e who believes himself
entitled to deprive another of the possession of a thing, so long as the possessor
refuses delivery, must request the assistance of the proper authority."
Petitioners' arbitrary conduct of fencing their properties under the claim that
they own the same brazenly violates the law and circumvents the proper
procedure which should be obtained before the court.
RE: Attorney’s Fees - denied
This Court likewise adopts the conclusion reached by the Court of Appeals that
petitioners do not deserve the award of attorney's fees for it was precisely their
unfounded insistence to stay on private respondents' properties that
precipitated this suit.
-Rochelle
F. Damages in different kinds of bonds
RUPERTO BELZUNCE, Plaintiff-Appellee, v. VALENTINA FERNANDEZ, ET AL.,
Defendants-Appellants.
SYLLABUS
[G.R. No. L-4155. March 20, 1908. ]
DOCTRINE:
COUNTERCLAIM FOR DAMAGES. — A counterclaim having been filed for the first
time on appeal before the Court of First Instance, and this allegation not having
been filed nor being proper in proceedings for ejectment in the court of the justice
of the peace, it was reasonably denied on account of its notorious impropriety, as
held in several decisions of the Supreme Court.
ACTION FOR DAMAGES RESULTING FROM ATTACHMENT. — To sustain an
action for damages resulting from an attachment requires a finding, previously
made in a final judgment, to the effect that the attachment was wrongful and
without sufficient cause, in conformity with the provisions of section 427, and
following the procedure prescribed by section 439 of the Code of Civil Procedure.
FACTS:
By a complaint filed with the Court of Justice of Isabela in 1905, the Belzunce
instituted ejectment proceedings against the Fernandez, et al., to oust the latter
from the hacienda named "Anonolip," and to recover the sum of P1,723.22, the
amount of rent due and unpaid.
The ejectment proceeding was dismissed, but Fernandez et al., were sentenced
to pay to Belzunce the rents due in the amount specified in the complaint. The
court of the justice of the peace furthermore issued an order for the preliminary
attachment of the carabaos and agricultural products of the defendants.
Belzunce filed a similar complaint with the CFI of Occidental Negros, praying for
the recovery of the possession of the said hacienda called "Anonolip," and the
payment of the rents corresponding to 1904 and 1905, already due, and the rents
which might accrue during the year 1906, together with the legal interest and the
costs.
Fernandez et al., made a general denial of all the facts alleged and alleged that
they had already paid the rent claimed, which constitutes the interest on a
mortgage debt, and that, on the contrary, there remained a balance to their credit.
In addition thereto, Fernandez et al., by way of counterclaim, made a further
claim for damages amounting to P15,000 resulting, on the one hand, from the
preliminary attachment, and on the other, from noncompliance, on the part of the
plaintiff, with a contract under seal, according to the terms of which the latter
bound himself to furnish the defendants the money necessary to cultivate the
hacienda "Anonolip." This hacienda had been sold by the defendants to the
plaintiff on June 14, 1903, the right of repurchase was reserved to the former, and
by the terms of the agreement in the form of a contract of lease said land was to
be left in the possession of the vendors during the period allowed for the
repurchase, conditioned upon the payment of rent, which was made the subject
of the complaint in this case, because the rent was not paid during the years above
mentioned.
The CFI reversed the judgment of the court of justice and ruled that the
agreement is a contract of sale with right of repurchase, and that the defendants,
at the date of the filing of the complaint of ejectment in this case, had already paid
the rents corresponding to 1904 and 1905.
Both parties appealed from the above judgment, and both also petitioned for a
rehearing. Some time after, however, the plaintiff withdrew his appeal and
motion for rehearing, leaving only the appeal and motion for rehearing filed by
the defendants, which gave rise to the bill of exceptions which was duly certified
and filed with this court soon after exception was taken to the order denying the
motion for rehearing.
ISSUE:
Whether he court erred "in not finding against the plaintiff for the payment to the
defendants of the damages resulting from the preliminary attachment, and in not
reserving to them at least the right to bring an action against the plaintiff, in this
case, for damages caused by the illegal preliminary attachment."
RULING:
The CFI did not err in not finding against the plaintiff for the payment of damages
resulting from the preliminary attachment issued by request of the latter, nor did
the lower court commit error in not reserving to the defendants the right to bring
a separate action for said damages:
First, because the non-reservation by judgment of the court of the right which
one of the parties to an action deems he may exercise in a separate action is
neither an error nor an injury, because the law does not impose upon the judge
the duty of making a reservation of this kind in cases when the exercise of the
right does not depend thereon.
Second, because the counterclaim for damages, filed for the first time on appeal
before the Court of First Instance, not having been filed nor being proper in the
proceeding for ejectment in the court of the justice of the peace, it was reasonably
denied, on account of its notorious impropriety, as has been determined in
several decisions of the Supreme Court.
Third, because, according to section 439 of the Code of Civil Procedure, whose
heading is "Disposition of attached property in case of judgment against the
plaintiff upon the obligation provided in section 427 for any damages he may
have sustained by reason of the attachment, after summary hearing in the same
action on due notice," if the attachment, according to section 427, "shall finally be
adjudged to have been wrongful or without sufficient cause."
PIONEER INSURANCE AND SURETY CORPORATION, petitioner,
vs.
DE DIOS TRANSPORTATION CO., INC. and DE DIOS MARIKINA TRANSIT
CORPORATION, respondents.
G.R. No. 147010 July 18, 2003 CALLEJO, SR., J.
FACTS:
Herein respondents De Dios Transportation Co. (DDTC) and De Dios Marikina
Transport Corporation (DMTC) were the franchise holders and owners of fifty-
eight buses plying the Buendia-Ayala-UP and Monumento Ayala routes. On
February 23, 1995, the respondents, as vendors, executed a Deed of Conditional
Sale covering the said buses and their franchise in favor of Willy Choa Coyukiat
(Coyukiat) and/or Goldfinger Transport Corporation (Goldfinger) as vendees. In
the said contract, the respondents bound and obliged themselves to sell to
Coyukiat and Goldfinger the fifty eight buses and their corresponding franchise,
and to deliver and turn over possession of the said buses to the vendees for the
price of P12,000,000.
The parties further agreed that in case of default by the vendors, it is agreed and
understood that the representations and warranties made by the VENDORS in
this Contract are the primary motivations/reasons that induced, convinced and
moved the VENDEE to enter into this contract and the Deed of Sale. In the event
of default by the VENDORS, the VENDEE shall at its option either consider the
obligations of the VENDORS under the Contract immediately due and
demandable and the VENDORS shall immediately execute the Deed of Sale of the
buses and their corresponding lines/franchises without need of any further
payments or reimburse all the amounts paid by the VENDEE to the VENDORS. In
either case, the VENDORS shall, likewise, be liable to the VENDEE for liquidated
damages in the amount of Twelve Million (P12,000,000.00) pesos. In the event of
default by the VENDEE, the VENDORS shall at their option, declare the entire
obligation due and demandable, and demand for the payment of the entire
balance of the purchase price or declare the contract as without any further force
and effect and that all payments previously paid are forfeited. In either case, the
VENDEE shall, likewise, be liable for liquidated damages in the amount of Twelve
Million (P12,000,000.00) Pesos in favor of the VENDORS.
The respondents, as vendors, guaranteed that the franchise and routes to
Buendia-Ayala-UP and vice versa and Monumento-Ayala via EDSA were
valid, fully and completely utilizable, and merely required registration with
the Land Transportation Office (LTO) for the vendees to be able to operate the
same. The vendees delivered the downpayment and postdated checks drawn
upon the account of Goldfinger with the Philbanking Corporation for the balance
of the purchase price.
On March 23, 1995, the respondents delivered the buses to the vendees. The
respondents were able to encash the check for the downpayment of the purchase
price. However, before the respondents could deposit the first check for the
remaining balance, the vendees stopped all payments, on their claim that,
contrary to the representations of the respondents, some of the buses were not
in good running condition. The color of the buses had been changed without
the proper permits or clearances from the Land Transportation Franchising and
Regulatory Board (LTFRB), the LTO and the Philippine National Police (PNP).
Consequently, the vendees failed to operate the buses. The vendees were,
likewise, unable to operate the buses along the Buendia-Ayala-UP route,
notwithstanding the representation of the respondents that only registration
with the LTO was required.
On July 20, 1995, the vendees, through its counsel, the Padilla Reyes & De la Torre
Law Office, filed a complaint against the respondents and Philbanking
Corporation as defendants with the Regional Trial Court (RTC) of Quezon City for
rescission of contract with a plea for a temporary restraining order or writ of
preliminary injunction. Therein plaintiffs Coyukiat and Goldfinger alleged that
defendants (the respondents herein) reneged on their obligation to deliver the
buses in good running condition.
The vendees furthermore prayed as follows: Ordering the defendant De Dios
Transportation Co. Inc. and the De Dios Marikina Transit Corporation to pay
jointly and severally to the plaintiffs the amount of One Million Pesos
(P1,000,000.00) as moral damages. Ordering the defendants De Dios
Transportation Co. Inc. and the De Dios Marikina Transit Corporation to pay
jointly and severally the amount of One Million Pesos (P1,000,000.00) as
exemplary damages. Ordering the defendants De Dios Transportation Co. Inc. and
the De Dios Marikina Transit Corporation to pay jointly and severally to the
plaintiffs the amounts of Five Hundred Thousand Pesos (P500,000.00) as
attorney's fees and at least One Hundred Thousand Pesos (P100,000.00) as
litigation expenses.
On July 21, 1995, the RTC issued a temporary restraining order enjoining the
defendants and their agents from encashing, accepting, clearing, or transacting
twelve postdated checks issued by therein plaintiff Coyukiat. On August 11, 1995,
the RTC granted the plaintiffs' plea for a writ of preliminary injunction on a
bond of P11,000,000.
On August 17, 1995, the plaintiffs filed an amended complaint dropping
Philbanking Corporation as party-defendant.
The defendants, in their answer with counterclaim, denied the material
allegations of the complaint and prayed for the dismissal thereof. The defendants
interposed counterclaims for damages and attorney's fees, thus: (a) P11,000,000
representing the plaintiffs' unpaid balance; (b) P12,000,000 representing
liquidating damages; (c) P1,000,000 for moral damages; (d) P1,000,000 for
exemplary damages; and (e) twenty percent of the claim representing attorneys
fees and P1,000 for each court appearance.
On December 14, 1998, the RTC rendered a decision dismissing the complaint
and granting the counterclaims of the defendants. Aggrieved, the plaintiffs
Coyukiat and Goldfinger interposed an appeal to the Court of Appeals (CA).
On September 15, 1999, the respondents filed with the CA a Motion to Execute
Against the Injunction Bond posted by herein petitioner Pioneer Insurance and
Surety Corporation, serving a copy thereof on Atty. Ronaldo Reyes. The
respondents alleged inter alia in their motion that the appellants Coyukiat and
Goldfinger were not entitled to a temporary restraining order or a writ of
preliminary injunction. They contend that were it not for the said temporary
restraining order and writ of preliminary injunction, the appellants would not
have been able to hide and dispose of their assets and sell the buses, thus
frustrating the collection of the amount of P11,000,000 representing the
respondents' counterclaim.
On November 4, 1999, the petitioner filed with the CA its comment on the
opposition to the motion to execute filed by the respondents with the CA on the
following grounds: I There is no basis for defendants-appellees to execute against
the injunction bond; II The Decision of the lower court has become final and,
therefore, defendants-appellees' Motion can no longer be entertained; and III Even
assuming, for the sake of argument that an application for damages can still be
made, defendants-appellees suffered no damage by reason of the issuance of the
injunction.
In accordance with the directive of the Court of Appeals, the respondents filed on
December 9, 1999 with the RTC a Motion to Resolve their Motion to Execute
Against the Injunction Bond. On February 2, 2000, the court a quo issued an order
denying the motion of the respondents on the following grounds: (a) its Decision
dated December 4, 1998 had already attained finality in view of the withdrawal
of the appeal by the plaintiffs; and (b) the resolution of the respondents' motion
to execute against the injunction bond would necessitate the reception of
evidence which could no longer be done as its decision had become final and
executory. The respondents' motion for reconsideration of the order was denied
by the court on March 13, 2000.
On April 21, 2000, the respondents, consequently, filed a petition for certiorari
under Rule 65 before the CA seeking the annulment of the February 2, 2000 and
March 13, 2000 Orders of the court a quo. The respondents in this case alleged
inter alia that the court a quo acted with grave abuse of discretion amounting to
lack or excess of jurisdiction when it denied their motion to resolve (the motion
to execute against the injunction bond) on the ground that the judgment in the
main case had become final and executory, and that the case could no longer be
re-opened for the parties to adduce evidence in support of the motion.
On June 23, 2000, herein petitioner filed its comment. The petitioner averred that
the decision of the trial court had become final and executory on September 14,
1999, upon the withdrawal of the appeal. Further, when the CA issued its October
8, 1999 Resolution directing the respondents in this case to address their motion
to the trial court, it had already lost its jurisdiction over the appeal. Even
assuming that the motion of the respondents was timely filed, nevertheless,
they did not suffer any damages arising from the preliminary injunction
issued by the trial court. The injunction bond answers only for the damages
caused to the adverse party by reason of the wrongful issuance of the
injunction and not for the damages awarded by the trial court on the
respondents' counterclaims.
On October 31, 2000, the CA rendered a decision annulling the assailed orders of
the trial court and granting the motion to execute on the injunction bond issued
by the petitioner therein. The Court of Appeals cited the ruling of this Court in
International Container Terminal Services, Inc. v. Court of Appeals,24 which
declared that Section 20, Rule 57 of the Rules of Court regarding the application
against the surety bond in support of the writ of preliminary attachment shall
apply by analogy to a preliminary injunction. The CA likewise cited the ruling of
this Court in Rivera v. Talavera,25 and Ponce Enrile v. Capulong,26 that the
application or claim for damages against the injunction bond must be filed before
the trial court either during the trial with due notice to the surety or sureties, or
even after trial when judgment is rendered, but before entry thereof.
ISSUES:
1. WON The Honorable Court of Appeals erred when it ruled that it still had
jurisdiction over the case even after Coyukiat and Goldfinger had filed their
Notice of Withdrawal of Appeal as a matter of right.
2. WON the respondents are not entitled to execute on the injunction bond for
failing to file an application for damages against the injunction bond at the trial
of the main case, Civil Case No. Q-95-24462, and for filing the same only after the
decision in said case had become final and executory.
3. WON The judgment of the Quezon City RTC-Branch 223 in the main case, Civil
Case No. Q-95-24462, did not include any award for damages in favor of
respondents by reason of the issuance of the writ of preliminary injunction, and
the fact that the decision therein was in favor of respondents did not
automatically entitle them to such award for damages.
4. WON The damages allegedly sustained by respondents were not by reason of
the issuance of the writ of preliminary injunction.
RULING:
The petition is bereft of merit.
The Court of Appeals still had jurisdiction over the case when the
Motion to Execute Against the Injunction Bond was filed.
Petitioner argues in its Petition that Coyukiat filed a Withdrawal of Appeal on
September 14, 1999 or one day before respondents filed their Motion to Execute
Against Injunction Bond on September 15, 1999. Since no appellee's brief had
been filed at that time, petitioner argues that the withdrawal of the appeal was a
matter of right. Thus, Pioneer triumphantly concludes, on September 14, 1999
the appeal was already effectively withdrawn and the Decision of the trial court
had already become final and executory.
What Pioneer conveniently does not disclose is that the Withdrawal of Appeal was
not filed by counsel of record for Coyukiat but a different counsel purporting to
be the newly substituted counsel for Coyukiat. This different counsel from the
counsel of record had entered her appearance as such only for the purpose of
withdrawing the appeal.
More importantly, Pioneer also conveniently fails to disclose that neither the Entry
of Appearance of new counsel for Coyukiat nor the Withdrawal of the Appeal bore
the conformity of Willy Choa Coyukiat and Goldfinger Transport Corporation —
the appellants. It is well-established that substitution of counsel is not effective
without the conformity of client. Moreover, well-entrenched is the rule that
pleadings which have the effect of withdrawing the appeal should bear the
conformity of the appellant.
Clearly therefore, the Withdrawal of Appeal filed on September 14, 1999 was not
effectual because it did not bear the conformity of Coyukiat. The new counsel of
Coyukiat (who entered her appearance without Coyukiat's conformity in
substitution of the counsel of record) cannot reasonably expect that she will be
allowed by the Court of Appeals to withdraw the appeal on her own. This is
especially so when even her substitution of the counsel of record does not bear
the conformity of the appellants.
For a substitution of attorneys to be effectual, the procedure to be followed strictly
is as follows:
"In order that there may be substitution of attorneys in a given
case, there must be (1) a written application for substitution; (2)
the written consent of the client; (3) the written consent of the
attorney substituted; and (4) in case such written consent
cannot be secured, there must be filed with the application proof
of service of notice of such motion upon the attorney to be
substituted, in the manner prescribed by the rules. Unless the
foregoing formalities are complied with, substitution will not be
permitted, and the attorney who properly appeared last in the
case, before such application for substitution, will be regarded
as the attorney of record and will be held responsible for the
proper conduct of the case." (Adarne vs. Aldaba, A.C. No. 801,
June 27, 1978; Cortez, et al. vs. CA, et al., L-32547, May 9, 1978;
Ramos vs. Potenciano, 118 Phil. 1435; and U.S. vs. Borromeo, 20
Phil. 189).
In this case, therefore, the Withdrawal of Appeal filed by a new counsel who
substituted the counsel of record — Atty. Ronaldo Reyes, without bearing the
conformity of Coyukiat was a mere scrap of paper.
As mentioned above, the appellants only manifested their desire to withdraw the
appeal, by way of the signature of Coyukiat in his behalf and in behalf of
Goldfinger Transport Corporation, on September 29, 1999. This conformity was
taken note of by the Court of Appeals on October 8, 1999 when it dismissed the
appeal.
Clearly, therefore, even if we were to follow petitioner's argument that a
withdrawal of appeal is a matter of right and needs no further action from the
court, in this case the intention of withdrawing the appeal was only properly
made known to the court by Coyukiat and Goldfinger Transport Corp. on
September 29, 1999.
 By that time, respondents had already filed their Motion to Execute
Against the Injunction Bond. It is, therefore, not factually and legally
accurate for petitioner Pioneer to claim that the Court of Appeals had
already lost jurisdiction over the case when the Motion to Execute
Against the Injunction Bond was filed.28
In its reply to the comment of the respondents, the petitioner avers that the
compliance to the CA Resolution of September 16, 1999, to submit the appellants'
conformity to the substitution of new counsel and the withdrawal of the appeal
was a ratification of the withdrawal of the appeal by the new counsel which
should be deemed effective as of the date of the filing of the notice of withdrawal
of appeal, or on September 14, 1999.
For its part, the CA ruled that it still retained jurisdiction over the appeal when
the respondents filed their motion for execution of the bond with the said court,
the supervening finality of the RTC decision notwithstanding
The contention of the petitioner does not persuade.
First. The notice of withdrawal of appeal filed by the Luis Q.U. Uranza, Jr. &
Associates on September 14, 1999 with the CA was a mere scrap of paper, absent
a valid substitution of counsel. The counsel of record as of September 14, 1999
was the Padilla Reyes & De la Torre Law Office. On the said date, the law office
filed a motion with the CA to withdraw as counsel for the appellants, while the
Luis Q.U. Uranza, Jr. & Associates filed the notice of withdrawal of appeal for the
appellants. In the case of Santana-Cruz v. Court of Appeals,30 this Court
enumerated the essential requisites of a valid substitution of counsel:
. . . No substitution of counsel of record is allowed unless the following
essential requisites of a valid substitution of counsel concur: (1) there
must be a written request for substitution; (2) it must be filed with the
written consent of the client; (3) it must be with the written consent of
the attorney to be substituted; and (4) in case the consent of the attorney
to be substituted cannot be obtained, there must be at least a proof of
notice that the motion for substitution was served on him in the manner
prescribed by the Rules of Court. . . .31
There was clearly no compliance to these essential requisites. It was only on
September 16, 1999 when the CA granted the motion of the Padilla Reyes & De la
Torre Law Office to withdraw as counsel for the appellants that the withdrawal
of the said counsel and its substitution by the Luis Q.U. Uranza, Jr. & Associates
became effective.
Second. Section 3, Rule 50 of the Rules of Court, as amended, reads:
Section 3. Withdrawal of appeal. — An appeal may be withdrawn as a
matter of right at any time before the filing of the appellee's brief.
Thereafter, the withdrawal may be allowed in the discretion of the court.
We agree with the respondents that the notice of withdrawal of appeal of the
appellants in CA-G.R. CV No. 61310 filed on September 14, 1999 was not self-
executory, and did not render the trial court's December 4, 1998 Decision final
and executory. While we agree with the petitioner that under Section 3, Rule 50
of the Rules of Court, an appeal maybe withdrawn by the appellants as a matter
of right at any time before the filing of the appellees' brief; however, the rule does
not apply in this case because the notice of withdrawal of appeal filed in CA-G.R.
CV No. 61310 by the Luis Q.U. Uranza, Jr. & Associates did not bear the appellants'
conformity thereto. It bears stressing that the counsel of the appellants was a
mere agent holding a special power of attorney to act for and in behalf of the
principal respecting the ordinary course of the appealed case. There was a need
for the appellants, as the principals, to execute a special power of attorney
specifically authorizing the withdrawal of a perfected appeal. Absent a special
power of attorney expressly authorizing their counsel to withdraw their appeal,
or in lieu thereof, the written conformity of the appellants to the withdrawal of
their appeal, the notice of withdrawal of appeal by the new counsel of the
appellants was a mere scrap of paper.
Third. The submission by the appellants on September 28, 1999 of the requisite
conformity to the withdrawal of their appeal should not be given retroactive
effect so as to foreclose the right of the respondents to file with the CA their
motion to execute against the injunction bond, thus enabling the petitioner to
escape liability on the same.
The notice of withdrawal of appeal was deemed filed only on September 28, 1999
upon compliance with the September 16, 1999 Resolution of the CA. The appeal
of the appellants was effectively withdrawn and dismissed before October 8,
1999 when the CA issued its resolution therein. The petitioner should not be
benefited by the deleterious manipulation of the rules of procedure.
On the second ground, the petitioner avers that the respondents failed to serve a
copy of their (respondents') motion to execute on the bond as mandated by
Section 20, Rule 51 of the Rules of Court, as amended, which reads:
1. The application for damages must be filed in the same case where the
bond was issued;
2. Such application for damages must be filed before the entry of
judgment; and
3. After hearing with notice to the surety.34
In International Container Terminal Services, Inc. v. Court of Appeals,35 this Court
ruled that due notice to the adverse party and its surety setting forth the facts
supporting the applicant's right to damages and the amount thereof under the
bond is indispensable. The surety should be given an opportunity to be heard as
to the reality or reasonableness of the damages resulting from the wrongful
issuance of the writ.36 In the absence of due notice to the surety, therefore, no
judgment for damages may be entered and executed against it.
In this case, the petitioner was not served with a copy of the motion to execute
on the bond filed by the respondents with the CA in CA-G.R. CV 61310. But the
records show that the CA directed the petitioner to file its comment on the said
motion.37 On November 4, 1999, the petitioner filed its comment on the
respondents' motion, and on December 9, 1999, the respondents filed their
motion to resolve with the trial court, serving a copy . thereof to the petitioner. It
cannot, thus, be gainsaid that the petitioner was deprived of its right to be heard
on the respondents' motion to execute on the bond.
We also agree that the Court of Appeals had the authority to remand to the court
of origin the resolution of the motion to execute against the injunction bond after
the parties adduced their respective evidence on the motion. To repeat, the
respondents' motion to execute was filed earlier than the motion to withdraw the
appeal, and more importantly, before the December 4, 1998 Decision of the court
of origin became final and executory.38
On the third and fourth grounds, the same should be addressed to and resolved
by the trial court after due hearing and presentation of evidence. As it was, the
trial court denied the motion of the respondents on its finding that it had no
jurisdiction to take cognizance of the motion, without affording the parties the
right to adduce evidence thereon.
IN LIGHT OF ALL THE FOREGOING, the Petition is DENIED DUE COURSE. The
decision of the Court of Appeals is AFFIRMED. The RTC Quezon City, Branch 223,
is directed to resolve on the merits the Motion to Execute Against Injunction Bond
filed by the respondents after the parties shall have adduced their respective
evidence in Civil Case No. Q-95-24462 with dispatch.
California Bus vs. SIHI
CALIFORNIA BUS LINES, INC. vs. STATE INVESTMENT HOUSE, INC.
G.R. No. 147950, December 11, 2003, QUISUMBING, J.
FACTS:
Delta Motors Corporation (Delta) applied for financial assistance from
respondent State Investment House, Inc. (hereafter SIHI). SIHI agreed to extend
a credit line to Delta for ₱25 million pesos. Delta eventually became indebted to
SIHI to the tune of ₱24million.
Meanwhile, petitioner California Bus Lines, Inc. (hereafter CBLI), purchased on
installment basis 35 units Buses and and 2 units of Diesel Conversion Engines
from Delta. To secure the payment of the purchase price of the 35 buses, CBLI
and its president, Mr. Dionisio O. Llamas, executed 16 promissory notes in favor
of Delta.
When CBLI defaulted on all payments due, it entered into a restructuring
agreement with Delta. In case of default, Delta would have the authority to take
over the management and operations of CBLI until CBLI and/or its president, Mr.
Dionisio Llamas, remitted and/or updated CBLI’s past due account.
Delta executed a Continuing Deed of Assignment of Receivables in favor of
SIHI as security for the payment of its obligations to SIHI per the credit
agreements.
CBLI continued having trouble meeting its obligations to Delta. This prompted
Delta to threaten CBLI with the enforcement of the management takeover clause.
To pre-empt the take-over, CBLI filed on a complaint for injunction , In due time,
Delta filed its amended answer with applications for the issuance of a writ
of preliminary mandatory injunction to enforce the management takeover
clause and a writ of preliminary attachment over the buses it sold to CBLI.
The trial court granted this.
As regards Delta’s remaining obligation to SIHI, Delta offered its available bus
units, valued at ₱27,067,162.22, as payment in kind. On December 29, 1983, SIHI
accepted Delta’s offer, and Delta transferred the ownership of its available buses
to SIHI, which in turn acknowledged full payment of Delta’s remaining obligation.
When SIHI was unable to take possession of the buses, SIHI filed a petition for
recovery of possession with prayer for issuance of a writ of replevin. The Manila
RTC issued a writ of replevin and SIHI was able to take possession of 17 bus units
belonging to Delta. SIHI applied the proceeds from the sale of the said 17 buses
amounting to ₱12,870,526.98 to Delta’s outstanding obligation. Delta’s obligation
to SIHI was thus reduced to ₱20,061,898.97.
Thereafter, Delta and CBLI entered into a compromise agreement, the
injunction case before the RTC of Pasay. CBLI agreed that Delta would exercise
its right to extrajudicially foreclose on the chattel mortgages over the 35 bus
units. The RTC of Pasay approved this compromise agreement the following day,
July 25, 1984. Following this, CBLI vehemently refused to pay SIHI contending
that the compromise agreement was in full settlement of all its obligations to
Delta including its obligations under the promissory notes.
SIHI filed a complaint against CBLI in the Regional Trial Court of Manila to
collect payment of loan obligation, SIHI also prayed for the issuance of a
writ of preliminary attachment against the properties of CBLI
In view of Delta’s petition and motion for execution per the judgment of
compromise, the RTC of Manila granted SIHI’s application for preliminary.
Consequently, SIHI was able to attach and physically take possession of thirty-
two (32) buses belonging to CBLI. However, acting on CBLI’s motion to quash the
writ of preliminary attachment, the same court resolved to discharge the writ of
preliminary attachment. SIHI assailed the discharge of the writ before the CA in
a petition for certiorari and prohibition. Court of Appeals granted SIHI’s petition
and ruled that the writ of preliminary attachment issued by RTC Manila should
stay. The decision of the Court of Appeals attained finality
Meanwhile, in the case filed by SIHI against CBLI, trial court likewise favorably
ruled on CBLI’s compulsory counterclaim. The trial court directed SIHI to
return the 16 buses or to pay CBLI ₱4,000,000 representing the value of the
seized buses, with interest at 12% p.a. to begin from January 11, 1985, the
date SIHI seized the buses, until payment is made. In ruling against SIHI, the
trial court held that the restructuring agreement, between Delta and CBLI
novated the five promissory notes; hence, at the time Delta assigned the five
promissory notes to SIHI, the notes were already merged in the restructuring
agreement and cannot be enforced against CBLI.
SIHI appealed the decision to the Court of Appeals. CA ruled that it found CBLI
liable for the value of the five (5) promissory notes subject of the complaint
a quo less the proceeds from the attached sixteen (16) buses. The award of
attorney’s fees and costs is eliminated. It also ruled that CBLI is not entitled for
lost income and the value of the 16 buses over which SIHI obtained a writ of
preliminary attachment.
ISSUE: Whether or not CA erred in not ruling for damages in favor of CBLI
RULING:
NO. CA did not err in not ruling for the amount of damages in favor of CBLI
(Finally,) in the light of the justness of SIHI’s claim against CBLI, we cannot
sustain CBLI’s contention that the Court of Appeals erred in dismissing its
counterclaim for lost income and the value of the 16 buses over which SIHI
obtained a writ of preliminary attachment. Where the party who requested
the attachment acted in good faith and without malice, the claim for
damages resulting from the attachment of property cannot be sustained.
Dispositive Portion:
WHEREFORE, the decision dated April 17, 2001, of the Court of Appeals in CA-
G.R. CV No. 52667 is AFFIRMED. Petitioner California Bus Lines, Inc., is ORDERED
to pay respondent State Investment House, Inc., the value of the five (5)
promissory notes subject of the complaint in Civil Case No. 84-28505 less the
proceeds from the sale of the attached sixteen (16) buses. No pronouncement as
to costs. SO ORDERED
G.R. No. 135830 September 30, 2005
JUAN DE DIOS CARLOS, Petitioners, vs. FELICIDAD SANDOVAL, also known
as FELICIDAD S. VDA. DE CARLOS or FELICIDAD S. CARLOS or FELICIDAD
SANDOVAL DE CARLOS, and TEOFILO CARLOS II, Respondent.
x-------------------------------------------------------------------x
G.R. No. 136035
SIDDCOR (now MEGA PACIFIC) INSURANCE CORPORATION, Petitioners, vs.
FELICIAD SANDOVAL VDA. DE CARLOS and TEOFILO CARLOS II, Respondent.
x------------------------------------------------------------------x
G.R. No. 137743
SIDDCOR (now MEGA PACIFIC) INSURANCE CORPORATION, Petitioners, vs.
HON. COURT OF APPEALS (FORMER SPECIAL FOURTH DIVISION), HON.
ALBERTO L. LERMA and/or the REGIONAL TRIAL COURT OF THE CITY OF
MUNTINLUPA, BRANCH 256, FELICIDAD SANDOVAL, also known as
FELICIDAD S. VDA. DE CARLOS OR FELICIDAD S. CARLOS OR FELICIDAD
SANDOVAL CARLOS OR FELICIDAD SANDOVAL VDA. DE CARLOS and
TEOFILO CARLOS II, Respondent.
FACTS:
These consolidated petitions emanated from a civil case filed by Juan de Dios
Carlos (Carlos') against respondents Felicidad Sandoval (Sandoval') and Teofilo
Carlos II (Teofilo II).
Felix and Felipa Carlos acquired during their marriage six parcels of land. They
had two sons: Juan and Teofilo. Felix and Felipa died intestate. Teofilo also died
intestate, leaving his wife Sandoval and his son, Teofilo II (herein defendants).
Juan Carlos claims he is the only heir of Felix and Felipa, because his late brother
Teofilo and Sandoval were not validly married as they had not obtained any
marriage license and their son, Teofilo II could not be considered as Teofilo’s
child. As a result, Carlos concluded that he was also the sole heir of his brother
Teofilo, since the latter had died without leaving any heirs.
Carlos also claimed that Teofilo, prior to their father Felixs' death in 1963,
developed a scheme to save the elder Carlos's estate from inheritance taxes..
After Teofilo's death, Carlos entered into certain agreements with Sandoval in
connection with the subject properties. Carlos did so, believing that the latter was
the lawful wife of his brother Teofilo. But upon knowing that the marriage of
Teofilo and Sandoval was invalid, Juan sought to nullify these agreements. He
also sought: (1) that the marriage between Teofilo and Sandoval be declared
void; (2) that new titles of the properties be issued in his name; (3) restitution
for 18M. Juan also prayed for issuance of provisionary relief of preliminary
attachment.
Juan Carlos posted a 20M bond issued by Siddcor Insurance. The court granted
the preliminary attachment. Shortly thereafter, a Notice of Garnishment was
served upon the Philippine National Bank (PNB) over the deposit accounts
maintained by respondents.
Sandoval filed a motion to discharge the writ of attachment but it was denied.
Sandoval filed certiorari with the CA. The CA granted and ordered the discharge
and dissolution of the writ of attachment and notice of garnishment, which
became final.
Back to the original complaint, after Sandoval filed an answer, she filed a motion
for Summary Judgment. Juan Carlos countered in by also filing his own Summary
Judgment. The court rendered a Summary Judgment in favor of Juan Carlos,
granting all his motions and prayers.
Juan Carlos moved for execution pending appeal, which was also granted by the
court and issued writ of execution.
Sandoval appealed to CA. She likewise filed a Petition for Certiorari with TRO,
attacking the allowance of execution pending appeal, and prayed for the
annulment of order granting execution and the writ.
Respondents filed a Motion for Judgment On the Attachment Bond. ' They noted
that the Court of Appeals had already ruled that the Writ of Preliminary
Attachment issued by the RTC was improperly granted and that its Decision, as
affirmed by the Supreme Court, had attained finality. Accordingly, they were
entitled to damages under Section 20, Rule 57 of the then Rules of Civil
Procedure, which governed claims for damages on account of unlawful
attachment. In support of their allegation of damages, they cite the Notice of
Garnishment served on PNB Malolos Branch, where Felicidad Carlos maintained
deposits amounting to P15,546,121.98.
The Court of Appeals found the claim for damages meritorious, citing the earlier
decisions ruling that Carlos was not entitled to the preliminary attachment.
Invoking Section 20, Rule 57 of the Rules of Court, as well as jurisprudence, the
Court of Appeals ruled that it was not necessary for the determination of damages
on the injunction bond to await the decision on appeal.
Both Carlos and SIDDCOR filed their respective motions for reconsideration of
the Resolution. For their part, respondents filed a Motion for Immediate
Execution dated 7 August 1998 in regard to the Resolution of 26 June 1998
awarding them damages.
In the Resolution dated 10 October 1998, the Court of Appeals denied the motions
for reconsideration and granted the Motion for Immediate Execution.
GR no. 135830
Juan Carlos argued that the CA could not have resolved the Motion for Judgment
on the Attachment Bond since the case had not yet been raffled; that CA erred in
resolving the motion without conducting any hearing; that CA had no jurisdiction
because the docketing fees had not yet been filed.
GR no. 136035
Siddcor Insurance argued that CA erred in ruling on the motion for damages
without awaiting the judgment in the main case; that a hearing was necessary to
prove the claim for damages.
GR no. 137743
Siddcor Insurance assails the allowance by the CA of the immediate execution of
the award for damages. Siddcor argues that the execution of a final order pending
appeal maybe made only on a motion of a prevailing party.
Sandoval countered that the judgment sought to be executed was interlocutory
and not appealable.
Facts arising subsequent to the filing of this instant petition
The CA issued writ of enforcement pertaining to the judgment on the attached
bond. SC issued TRO enjoining the enforcement of the said writ. CA rendered a
decision setting aside the Summary Judgment and remanding the case to RTC for
further proceedings.
ISSUES:
(1) Whether the assailed judgment on the attachment bond could have been
rendered, as it was, prior to the adjudication of the main case;
(2) Whether the Court of Appeals properly complied with the hearing
requirement under Section 20, Rule 57 prior to its judgment on the attachment
bond; and
(3) whether the Court of Appeals properly ascertained the amount of damages it
awarded in the judgment on the attachment bond.
HELD:
Resolving these issues requires the determination of the proper scope and import
of Section 20, Rule 57 of the 1997 Rules of Civil Procedure. The provision governs
the disposal of claims for damages on account of improper, irregular or excessive
attachment.
Section 20. An application for damages on account of improper, irregular
or excessive attachment must be filed before the trial or before appeal is
perfected or before the judgment becomes executory, with due notice to
the attaching obligee or his surety or sureties, setting forth the facts
showing his right to damages and the amount thereof. Such damages
may be awarded only after proper hearing and shall be included in
the judgment on the main case.
There is no question in this case that the Motion for Judgment on the Attachment
Bond filed by respondents was properly filed since it was filed with the Court of
Appeals during the pendency of the appeal in the main case. The core questions
though lie in the proper interpretation of the condition under Section 20, Rule 57
that reads: "Such damages may be awarded only after proper hearing and shall
be included in the judgment on the main case." Petitioners assert that there was
no proper hearing on the application for damages and that the Court of Appeals
had wrongfully acted on the application in that it resolved it prior to the rendition
of the main judgment.
“Such damages may be awarded only on proper hearing”
The hearing requirement ties with the indispensable demand of procedural due
process. Due notice to the adverse party and its surety setting forth the facts
supporting the applicant's right to damages and the amount thereof under the
bond is essential. No judgment for damages may be entered and executed against
the surety without giving it an opportunity to be heard as to the reality or
reasonableness of the damages resulting from the wrongful issuance of the writ.
That hearing embraces not only the right to present evidence but also a
reasonable opportunity to know the claims of the opposing parties and meet
them.
In this case, both Carlos and SIDDCOR were duly notified by the appellate court
of the Motion for Judgment on the Attachment Bond and were required to file
their respective comments' thereto. Carlos' and SIDDCOR filed their respective
comments' in opposition to private
The Court found it not mandatory that there should be a separate hearing in order
that damages upon the bond can be awarded. What is necessary only is for the
attaching party and his surety to be duly notified and given the opportunity to be
heard.
In this case, both Juan Carlos and Siddcor were duly notified by the appellate
court of the Motion for Judgment on the Attachment Bond; and Carlos and Siddcor
filed their respective comments in opposition. The relevant parties had been
afforded the bare right to be heard on the matter.
In this case, we rule that the demands of a 'proper hearing were satisfied as
of the time the Court of Appeals rendered its assailed judgment on the
attachment bond. The circumstances in this case that we consider particularly
telling are the settled premises that the judicial finding on the wrongfulness of
the attachment was then already conclusive and beyond review, and that the
amount of actual damages sustained was likewise indubitable as it 'indeed could
be found in the official case record in CA-G.R. CV No. 53229. As a result,
petitioners would have been precluded from either raising the defenses that the
preliminary attachment was valid or disputing the amount of actual damages
sustained by reason of the garnishment. The only matter of controversy that
could be litigable through the traditional hearing would be the matter of moral
and exemplary damages, but the Court of Appeals appropriately chose not to
award such damages.
Moreover, petitioners were afforded the opportunity to counter the arguments
extended by the respondents. They fully availed of that right by submitting their
respective comments/oppositions. In fine, the due process guarantee has been
satisfied in this case.
As to whether there should be an extensive full-blown hearing is discretionary
upon the trial court. However, with the CA and SC, they may choose to refer the
hearing to the trial courts, as CA and SC are not trier of facts. To impose
mandatory full-blown hearings on these appellate courts is supremely unwise.
“and shall be included in the judgment on the main case”
The language used in the 1997 revision of the Rules of Civil Procedure leaves no
doubt that there is no longer need for a favorable judgment in favor of the party
against whom attachment was issued in order that damages may be awarded. It
is indubitable that even a party who loses the action in main but is able to
establish a right to damages by reason of improper, irregular, or excessive
attachment may be entitled to damages. This bolsters the notion that the claim
for damages arising from such wrongful attachment may arise and be decided
separately from the merits of the main action As to the surety, it becomes liable
only when and if the court shall finally adjudge that the applicant was not entitled
to the attachment.
In this case, we are confronted with a situation wherein the determination that
the attachment was wrongful did not come from the trial court, or any court
having jurisdiction over the main action. It was rendered by the Court of Appeals
in the exercise of its certiorari jurisdiction in the original action reviewing the
propriety of the issuance of the Writ of Preliminary Attachment against the
private respondents. Said ruling attained finality when it was affirmed by this
Court.
The action of the CA in resolving the application for damages even before
the main judgment was issued does not conform to the rule. But such error
is not mortal to the award of damages. The premature award of damages
does not negate the fact that the parties were accorded due process.
Scope of Damages Properly Awardable
Next, we examine the particular award of damages made in this case, consisting
of P15,384,509.98, plus interest, as well as P1,000,000.00 as attorney's fees.
There seems to be no dispute that the former amount constituted the amount
drawn against the account of Sandoval by reason of the writ of execution issued
by the trial court on 27 May 1996. This fact was confirmed by the PNB, in its
Manifestation dated 19 July 1996, confirming the garnishment.
The rule is thus well-settled that the bond issued upon an application for
preliminary attachment answers for all damages, incurred at whatever stage,
which are sustained by reason of the attachment. The award of actual damages
by the Court of Appeals is thus proper in amount. However, we disagree that the
rate of legal interest be counted from the date of the 'unlawful garnishment, or
on 27 June 1996. Properly, interest should start to accrue only from the moment
it had been finally determined that the attachment was unlawful, since it is on
that basis that the right to damages comes to existence. In this case, legal interest
commences from the date the Court of Appeals decision in CA-G.R. SP No. 39267
became final, by reason of its affirmation by this Court.
The award of attorney's fees in the amount of P1,000,000.00 is also questioned
before this Court, considering that the Court of Appeals did not award moral or
exemplary damages. The general rule may be that an award of attorney's fees
should be deleted where the award of moral and exemplary damages are
eliminated. Nonetheless, attorney's fees may be awarded under the Civil Code
where the court deems it just and equitable that attorney's fees and expenses of
litigation should be recovered, even if moral and exemplary damages are
unavailing.Particularly, the Court has recognized as just and equitable that
attorney's fees be awarded when a party is compelled to incur expenses to lift a
wrongfully issued writ of attachment. The amount of money garnished, and the
length of time respondents have been deprived from use of their money by
reason of the wrongful attachment, all militate towards a finding that attorney's
fees are just and equitable under the circumstances. However, we deem the
amount of P1,000,000.00 as excessive, and modify the award of attorney's fees to
P500,000.00 which represents merely approximately three percent of the actual
damages suffered by and awarded to respondents. We also delete the imposition
of legal interest made by the Court of Appeals on the awarded attorney's fees.
WHEREFORE, the petitions are DISMISSED. The Temporary Restraining Order
issued in the Resolution dated 9 June 1999 is hereby LIFTED. The assailed
Resolution of the Court of Appeals Special Fourth Division dated 26 June 1998 is
AFFIRMED with the MODIFICATIONS that the legal interest on the award of
actual damages should commence from the date of the finality of the Decision of
the Court of Appeals in CA G.R. SP No. 39267 and that the award of attorney's fees
is in the amount of P500,000.
-Mika Ituriaga
G.R. No. 167131. September 12, 2006.
SPOUSES NAPOLEON FLORES, SR. and VERONIDIA FLORES, doing business
under the name FLORES Garments Mfg., and ALEXANDER J. FLORES, in his
capacity as Attorney-in-Fact of NAPOLEON M. FLORES, petitioners, vs.
STRONGHOLD INSURANCE COMPANY, INC., respondent.
FACTS:
On April 28, 1995, Stephen Liu and the spouses Flores executed a Memorandum
of Agreement (MOA), whereby the latter sold for P8,500,000.00 all their rights
and interests over their garments manufacturing business, including all its
existing licenses and government permits, machinery, supplies and spare parts,
and its real property located in Marikina City; and all other accessories, raw
materials, and other related items. For his part, Liu obliged himself to assume the
payment of the spouses’ obligations with Metropolitan Bank and Trust Company
as part of the purchase price, the balance of the purchase price to be paid within
120 days from the date of the signing of the MOA.
On September 7, 1995, Liu filed a complaint against the spouses Flores and
Alexander J. Flores (in his capacity as attorney-in-fact of Napoleon Flores, Sr.) for
specific performance and damages with a prayer for issuance of temporary
restraining order and/or writ of preliminary injunction and a writ of preliminary
attachment. He alleged that the spouses Flores failed and refused to execute the
necessary deeds of conveyance, transfer or assignment of all the items included
in the MOA, causing damages to him; as a consequence of their acts of harassment
and obstruction, he was entitled to the issuance of a temporary restraining order
or writ of preliminary injunction. He averred that, unless a writ of preliminary
attachment was issued, there might not be sufficient security for the satisfaction
of any judgment which the court might render against them.
On October 3, 1995, the RTC issued an Order granting Liu’s prayer for writ of
preliminary injunction and attachment upon the filing and approval of an
injunction bond in the amount of P2,000,000.00 and attachment bond in the
amount of P3,000,000.00. The plaintiff thus posted Attachment Bond No. 00565
and Injunction Bond No. 00566 issued by Stronghold Insurance Corporation, Inc.
for P3,000,000.00 and P2,000,000.00, respectively.
The spouses Flores alleged that the complaint failed to state a cause of action as
there was no allegation that he complied with his obligations under the MOA; it
was Liu who failed to pay the balance of the purchase price of the property, less
the amounts due to their creditors; such failure caused them actual damages in
the form of accumulated interests and penalties on their outstanding loans, loss
of expected profits on prospective and realizable business ventures and
opportunities.
RTC issued an Order granting the motion of the spouses Flores to lift the writ of
attachment upon the filing and approval of a counterbond in the amount of
P6,000,000.00; however, the RTC denied the prayer to lift the writ of preliminary
injunction. Upon motion of the spouses Flores, the RTC reconsidered its order
and reduced the amount of the counterbond to P3,000,000.00.
The trial court upheld the spouses Flores’ claim that it was Liu who committed a
breach of the MOA.
On July 1, 1999, the spouses Flores received a copy of the June 25, 1999 decision.
The parties did not appeal the decision. On July 16, 1999, the spouses Flores filed
their application for damages against the bonds posted by the SICI, captioned “A
Motion to Set Hearing on the Damages Caused by the Injunction and Attachment.”
They alleged that, by posting the injunction/attachment bonds, Liu and SICI
bound themselves to be jointly and severally liable for such damages sustained
by them by reason of the injunction/attachment if the RTC should finally decide
that it was not entitled to such remedy.
In its Comment and/or Opposition to the said motion, SICI averred that the
motion was premature, and that the alleged damages suffered by the spouses
Flores were not caused by the injunction or attachment for which the bonds
posted by it could be proceeded against.
RTC issued an Order directing SICI to pay the spouses Flores actual and moral
damages, attorney’s fees, and costs of suit.
However, CA rendered a Decision nullifying the Order of the RTC, holding that the
spouses Flores’ motion for damages against the bonds were filed on July 16, 1999;
the decision of the trial court had already become final and executory as to them
since they did not appeal the decision. Thus, the CA declared, the RTC no longer
had jurisdiction to hear the motion nor amend its own decision which had
become final and executory.
The spouses Flores, now petitioners, seek relief from this Court via petition for
review on Certiorari.
ISSUE:
Whether the petition for application of damages against the bonds posted by
respondent SICI was already time-barred when petitioners filed the same on July
16, 1999.
RULING:
The petition is meritorious.
Section 20 of Rule 57 of the 1997 Rules of Civil Procedure reads:
SEC. 20. Claim for damages on account of improper, irregular or
excessive attachment.—An application for damages on account of
improper, irregular or excessive attachment must be filed before the trial
or before appeal is perfected or before the judgment becomes executory,
with due notice to the attaching party and his surety or sureties, setting
forth the facts showing his right to damages and the amount thereof.
Such damages may be awarded only after proper hearing and shall be
included in the judgment on the main case.
An application for damages against the bonds must be filed in the same case
where the bond was issued, either (a) before the trial or (b) before the
appeal is perfected or (c) before the judgment becomes executory. The
principal party and his surety or sureties must be notified of said
application. This rule is mandatory. In the absence of due notice to the
surety, no judgment for damages may be entered and executed against it.
In this case, petitioners, as defendants below, received the Decision of the RTC
dated June 25, 1999 on July 1, 1999. Under Rule 41 of the Revised Rules of Court,
the decision may be appealed to the CA by filing a notice of appeal with the court
which rendered judgment or final order within fifteen (15) days from notice
thereof.
In the present case, petitioners received a copy of the decision on July 1, 1999.
Conformably with Section 1, Rule 22, in relation to Section 3, Rule 41, July 1, 1999
should be excluded from the computation of the fifteen-day period; hence, the 15-
day period should be computed from July 2, 1999. Counting 15 days from July 2,
1999, the 15th day fell on July 16, 1999; as such, petitioners had until July 16,
1999 within which to perfect their appeal from the decision of the trial court or
file their application under Section 20, Rule 57. Section 3, Rule 13 provides that a
pleading may be filed by registered mail, and the date of the mailing as shown by
the post office stamp on the envelope or the registry receipt shall be considered
as the date of the filing thereof.
The Court notes that petitioners filed their application and served a copy thereof
on respondent by registered mail on July 16, 1999. As of said date, the decision of
the RTC had not yet become final and executory, and the fifteen-day period to
appeal the decision had not yet lapsed. Thus, the application of the petitioners
with the RTC was not yet time-barred.
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The Decision of the
Court of Appeals in CAG.R. CV No. 77593 is REVERSED. The Court of Appeals is
ordered to REINSTATE the appeal of petitioners and to resolve the same in due
course. No costs. SO ORDERED.
G. Judgment of acquittal extinguishes liability of accused for damages
ROY PADILLA, FILOMENO GALDONES, ISMAEL GONZALGO and JOSE
FARLEY BEDENIA, petitioners, vs. COURT OF APPEALS, respondent.
FACTS
The petitioners were charged under the following information:
The undersigned Fiscal accused ROY PADILLA, FILOMENO
GALDONES, PEPITO BEDENIA, YOLLY RICO, DAVID
BERMUNDO, VILLANOAC, ROBERTO ROSALES, VILLANIA,
ROMEO GARRIDO, JOSE ORTEGA, JR., RICARDO CELESTINO,
REALINGO alias "KAMLON", JOHN DOE alias TATO, and
FOURTEEN (14) RICARDO DOES of the crime of GRAVE
COERCION, committed as follows:
That on or about February 8, 1964 at around 9:00 o'clock in the
morning, in the municipality of Jose Panganiban, province of
Camarines Norte, Philippines, and within the jurisdiction of this
Honorable Court, the above- named accused, Roy Padilla,
Filomeno Galdones, Pepito Bedenia, Yolly Rico, David
Bermundo, Villanoac, Roberto Rosales, Villania, Romeo Garrido,
Jose Ortega, Jr., Ricardo Celestino, Realingo alias Kamlon, John
Doe alias Tato, and Fourteen Richard Does, by confederating
and mutually helping one another, and acting without any
authority of law, did then and there wilfully, unlawfully, and
feloniously, by means of threats, force and violence prevent
Antonio Vergara and his family to close their stall located at the
Public Market, Building No. 3, Jose Panganiban, Camarines
Norte, and by subsequently forcibly opening the door of said
stall and thereafter brutally demolishing and destroying said
stall and the furnitures therein by axes and other massive
instruments, and carrying away the goods, wares and
merchandise, to the damage and prejudice of the said Antonio
Vergara and his family in the amount of P30,000.00 in concept
of actual or compensatory and moral damages, and further the
sum of P20,000.00 as exemplary damages.
That in committing the offense, the accused took advantage of
their public positions: Roy Padilla, being the incumbent
municipal mayor, and the rest of the accused being policemen,
except Ricardo Celestino who is a civilian, all of Jose Panganiban,
Camarines Norte, and that it was committed with evident
premeditation.
The CFI found the accused guilty beyond reasonable doubt. The petitioners
appealed the judgment of conviction to the Court of Appeals. The dispositive
portion of the decision of the respondent Court of Appeals states:
WHEREFORE, we hereby modify the judgment appealed from in
the sense that the appellants are acquitted on ground of
reasonable doubt. but they are ordered to pay jointly and
severally to complainants the amount of P9,600.00, as actual
damages.
The petitioners filed a motion for reconsideration contending that the acquittal
of the defendants-appellants as to criminal liability results in the extinction of
their civil liability, which was subsequently denied.
ISSUE
Whether or not judgment of acquittal extinguished the civil liability of the
accused
HELD
NO. Section 1 of Rule 111 of the Rules of Court states the fundamental proposition
that when a criminal action is instituted, the civil action for recovery of civil
liability arising from the offense charged is impliedly instituted with it. There is
no implied institution when the offended party expressly waives the civil action
or reserves his right to institute it separately. (Morte Sr. v. Alvizo, Jr., 101 SCRA
221).
The extinction of the civil action by reason of acquittal in the criminal case refers
exclusively to civil liability ex delicto founded on Article 100 of the Revised Penal
Code. (Elcano v. Hill, 77 SCRA 98; Virata v. Ochoa, 81 SCRA 472). In other words,
the civil liability which is also extinguished upon acquittal of the accused is the
civil liability arising from the act as a crime.
As easily as 1942, the Supreme Court speaking through Justice Jorge Bocobo in
Barredo v. Garcia, et at. 73 Phil. 607 laid down the rule that the same punishable
act or omission can create two kinds of civil liabilities against the accused and,
where provided by law, his employer. 'There is the civil liability arising from the
act as a crime and the liability arising from the same act as a quasi-delict. Either
one of these two types of civil liability may be enforced against the accused,
However, the offended party cannot recover damages under both types of
liability. For instance, in cases of criminal negligence or crimes due to reckless
imprudence, Article 2177 of the Civil Code provides:
Responsibility for fault or negligence under the preceding
article is entirely separate and distinct from the civil liability
arising from negligence under the Penal Code. But the plaintiff
cannot recover damages twice for the same act or omission of
the defendant.
The judgment of acquittal extinguishes the liability of the accused for damages
only when it includes a declaration that the facts from which the civil might arise
did not exist. Thus, the civil liability is not extinguished by acquittal where the
acquittal is based on reasonable doubt (PNB v. Catipon, 98 Phil. 286) as only
preponderance of evidence is required in civil cases; where the court expressly
declares that the liability of the accused is not criminal but only civil in nature (De
Guzman v. Alvia, 96 Phil. 558; People v. Pantig, supra) as, for instance, in the
felonies of estafa, theft, and malicious mischief committed by certain relatives
who thereby incur only civil liability (See Art. 332, Revised Penal Code); and,
where the civil liability does not arise from or is not based upon the criminal act
of which the accused was acquitted (Castro v. Collector of Internal Revenue, 4
SCRA 1093; See Regalado, Remedial Law Compendium, 1983 ed., p. 623). Article
29 of the Civil Code also provides that:
When the accused in a criminal prosecution is acquitted on the
ground that his guilt has not been proved beyond reasonable
doubt, a civil action for damages for the same act or omission
may be instituted. Such action requires only a preponderance of
evidence. Upon motion of the defendant, the court may require
the plaintiff to file a bond to answer for damages in case the
complaint should be found to be malicious.
If in a criminal case the judgment of acquittal is based upon
reasonable doubt, the court shall so declare. In the absence of
any declaration to that effect, it may be inferred from the text of
the decision whether or not the acquittal is due to that ground.
More recently, we held that the acquittal of the defendant in the criminal case
would not constitute an obstacle to the filing of a civil case based on the same acts
which led to the criminal prosecution:
... The finding by the respondent court that he spent said sum for
and in the interest of the Capiz Agricultural and Fishery School
and for his personal benefit is not a declaration that the fact
upon which Civil Case No. V-3339 is based does not exist. The
civil action barred by such a declaration is the civil liability
arising from the offense charged, which is the one impliedly
instituted with the criminal action. (Section 1, Rule III, Rules of
Court.) Such a declaration would not bar a civil action filed
against an accused who had been acquitted in the criminal case
if the criminal action is predicated on factual or legal
considerations other than the commission of the offense
charged. A person may be acquitted of malversation where, as
in the case at bar, he could show that he did not misappropriate
the public funds in his possession, but he could be rendered
liable to restore said funds or at least to make a proper
accounting thereof if he shall spend the same for purposes
which are not authorized nor intended, and in a manner not
permitted by applicable rules and regulations. (Republic v.
Bello, 120 SCRA 203)
There appear to be no sound reasons to require a separate civil action to still be
filed considering that the facts to be proved in the civil case have already been
established in the criminal proceedings where the accused was acquitted. Due
process has been accorded the accused. He was, in fact, exonerated of the criminal
charged. The constitutional presumption of innocence called for more vigilant
efforts on the part of prosecuting attorneys and defense counsel, a keener
awareness by all witnesses of the serious implications of perjury, and a more
studied consideration by the judge of the entire records and of applicable statutes
and precedents. To require a separate civil action simply because the accused
was acquitted would mean needless clogging of court dockets and unnecessary
duplication of litigation with all its attendant loss of time, effort, and money on
the part of all concerned.
We see no need to amend Article 29 of the Civil Code in order to allow a court to
grant damages despite a judgment of acquittal based on reasonable doubt. What
Article 29 clearly and expressly provides is a remedy for the plaintiff in case the
defendant has been acquitted in a criminal prosecution on the ground that his
guilt has not been proved beyond reasonable doubt. It merely emphasizes that a
civil action for damages is not precluded by an acquittal for the same criminal act
or omission. The Civil Code provision does not state that the remedy can be
availed of only in a separate civil action. A separate civil case may be filed but
there is no statement that such separate filing is the only and exclusive
permissible mode of recovering damages.
There is nothing contrary to the Civil Code provision in the rendition of a
judgment of acquittal and a judgment awarding damages in the same criminal
action. The two can stand side by side. A judgment of acquittal operates to
extinguish the criminal liability. It does not, however, extinguish the civil liability
unless there is clear showing that the act from which civil liability might arise did
not exist.
A different conclusion would be attributing to the Civil Code a trivial requirement,
a provision which imposes an uncalled for burden before one who has already
been the victim of a condemnable, yet non-criminal, act may be accorded the
justice which he seeks.
ELIZABETH EUSEBIO-CALDERON, petitioner, vs. PEOPLE OF THE
PHILIPPINES, respondent.
G.R. No. 158495 October 21, 2004 YNARES-SANTIAGO, J.:
FACTS: On May 15, 1994, petitioner Elizabeth Eusebio-Calderon visited her Aunt
Teresita in Bulacan to borrow P50,000.00, in exchange for which she issued an
Allied Bank Check No. 16076401, postdated November 15, 1994, in the amount
of P52,500.00. On May 30, 1994, petitioner again borrowed from Teresita the
amount of P100,000.00, in exchange for which she issued Allied Bank Check No.
16076402, postdated November 14, 1994, in the amount of P105,000.00.
On May 30, 1994, Amelia Casanova went to the drugstore of petitioner and lent
her the amount of P100,000.00, allegedly to be used for the expansion of her
business. In exchange, petitioner issued Allied Bank Check No. 16041982,
postdated November 30, 1994, for P100,000.00 and six other checks in various
amounts purportedly to cover the interests.
Manolito Eusebio alleges that in November 1994, petitioner borrowed money
from him because she needed it for her pharmaceutical business. Manolito loaned
her P50,000.00, for which she issued Allied Bank Check No. 16063578 covering
the principal amount of the loan, dated December 6, 1994, and four other
postdated checks for the interests thereon.
According to private complainants, petitioner assured them that the checks will
be honored upon maturity. They gave her the money because she showed them
her pieces of jewelry which convinced them that she has the ability to pay the
loans. Upon presentation of the said checks with the banks for deposit or
encashment, the same were dishonored and refused payment for having been
drawn against a "Closed Account". Thus, petitioner was charged by her aunt
Teresita Eusebio, and cousins Amelia Casanova and Manolito Eusebio, with three
counts of Estafa.
After trial, the lower court rendered a joint decision finding petitioner guilty
beyond reasonable doubt, but ruled that her liability for the “interest checks” was
only civil. On appeal, the CA reversed and set aside the Decision of the RTC and
acquitted the accused on the ground that her guilt has not been proven beyond
reasonable doubt. However, she is held civilly liable for the checks.
ISSUE:
 1. W/N the private respondents should file a separate civil complaint
for a claim of Sum of Money - NO
2. W/N the civil liability of petitioner includes the interest in the
principal loan despite the dismissal of the interest checks by the
Regional Trial Court - NO
RULING:
1. NO. Under Article 29 of the Civil Code, when the accused in a criminal
prosecution is acquitted on the ground that his guilt has not been proven beyond
reasonable doubt, a civil action for damages for the same act or omission may be
instituted. The judgment of acquittal extinguishes the liability of the accused
for damages only when it includes a declaration that the fact from which the
civil liability might arise did not exist. Thus, Section 1, paragraph (a) of Rule
111 of the Rules of Court provides:
SECTION 1. Institution of criminal and civil actions. – (a) When a criminal
action is instituted, the civil action for the recovery of civil liability arising
from the offense charged shall be deemed instituted with the criminal
action unless the offended party waives the civil action, reserves the right
to institute it separately or institutes the civil action prior to the criminal
action.
In the case of Manantan v. Court of Appeals, we elucidated on the two kinds of
acquittal recognized by our law as well as its different effects on the civil liability
of the accused. Thus:
x x x. First is an acquittal on the ground that the accused is not the
author of the act or omission complained of. This instance closes the
door to civil liability, for a person who has been found to be not the
perpetrator of any act or omission cannot and can never be held liable
for such act or omission. There being no delict, civil liability ex delicto is
out of the question, and the civil action, if any, which may be instituted
must be based on grounds other than the delict complained of. This is
the situation contemplated in Rule 111 of the Rules of Court.
The second instance is an acquittal based on reasonable doubt on the
guilt of the accused. In this case, even if the guilt of the accused has not
been satisfactorily established, he is not exempt from civil liability which
may be proved by preponderance of evidence only. This is the situation
contemplated in Article 29 of the Civil Code, x x x.
An accused who is acquitted of Estafa may nevertheless be held civilly liable
where the facts established by the evidence so warrant. Petitioner Elizabeth
Calderon is clearly liable to the private respondents for the amount borrowed.
The Court of Appeals found that the former did not employ trickery or deceit in
obtaining money from the private complainants, instead, it concluded that the
money obtained was undoubtedly loans for which petitioner paid interest. The
checks issued by petitioner as payment for the principal loan constitute
evidence of her civil liability which was deemed instituted with the criminal
action.
2. NO. The civil liability of petitioner includes only the principal amount of the
loan. With respect to the interest checks she issued, the same are void. There was
no written proof of the payable interest except for the verbal agreement that the
loan shall earn 5% interest per month. Under Article 1956 of the Civil Code, an
agreement as to payment of interest must be in writing, otherwise it cannot be
valid. Consequently, no interest is due and the interest checks she issued should
be eliminated from the computation of her civil liability.
However, while there can be no stipulated interest, there can be legal interest
pursuant to Article 2209 of the Civil Code. It is elementary that in the absence of
a stipulation as to interest, the loan due will now earn interest at the legal rate of
12% per annum.
When the obligation is breached, and it consists in the payment of a sum
of money, i.e., a loan or forbearance of money, the interest due should be
that which may have been stipulated in writing. Furthermore, the
interest due shall itself earn legal interest from the time it is judicially
demanded. In the absence of stipulation, the rate of interest shall be 12%
per annum to be computed from default, i.e., from judicial or
extrajudicial demand under and subject to the provisions of Article 1169
of the Civil Code. (Eastern Shipping Lines, Inc. v. Court of Appeals)
Hence, petitioner is liable for the payment of legal interest per annum to be
computed from December 20, 1994, the date when she received the demand
letter. After the judgment becomes final and executory until the obligation is
satisfied, the amount due shall earn interest at 12% per year, the interim period
being deemed equivalent to a forbearance of credit.
DISPOSITIVE PORTION:
WHEREFORE, in view of the foregoing, the Decision of the Court of Appeals in
CA-G.R. CR No. 23466 is AFFIRMED with the MODIFICATION that petitioner is
ordered to pay Amelia Casanova the sum of P100,00.00; Teresita Eusebio the sum
of P157,500.00; and Manolito Eusebio the sum of P50,000.00 as civil liability with
legal interest of twelve percent (12%) per annum from December 20, 1994 until
its satisfaction.Costs de oficio. SO ORDERED.
H. Damages under Art. 104 of the Revised Penal Code
JOSE S. RAMISCAL, JR., petitioner, vs. HONORABLE SANDIGANBAYAN
(Fourth Division), ALBANO & ASSOCIATES and the ASSOCIATION OF
GENERALS & FLAG OFFICERS, INC., respondents.
G.R. Nos. 140576-99, SECOND DIVISION, December 13, 2004, CALLEJO, SR., J.
FACTS:
The Armed Forces of the Philippines Retirement and Separation Benefits System
(AFP-RSBS) was established in December 1973 and started its actual operations
in 1976. Created under Presidential Decree (P.D.) No. 361, as amended, the AFP-
RSBS was designed to establish a separate fund to guarantee continuous financial
support to the AFP military retirement system as provided for in Republic Act No.
340. Under the decree, the AFP-RSBS was to be funded from three principal
sources: (a) congressional appropriations and compulsory contributions from
members of the AFP; (2) donations, gifts, legacies, bequests and others to the
system; and (3) all earnings of the system which shall not be subject to any tax
whatsoever. AFP-RSBS is a government-owned or controlled corporation (GOCC)
under Rep. Act No. 9182, otherwise known as "The Special Purpose Vehicle Act
of 2002." It is administered by the Chief of Staff of the AFP through a Board of
Trustees and Management Group. Its funds are in the nature of public funds.
On December 18, 1997, Luwalhati R. Antonino, then a member of the House of
Representatives representing the First District of the Province of South Cotabato,
filed a "Complaint-Affidavit" with the Office of the Ombudsman for Mindanao. She
alleged that anomalous real estate transactions involving the Magsaysay Park at
General Santos City and questionable payments of transfer taxes prejudicial to
the government had been entertained into between certain parties. She then
requested the Ombudsman to investigate the petitioner, Retired Brig. Gen. Jose S.
Ramiscal, Jr., then President of the AFP-RSBS, together with twenty-seven (27)
other persons for conspiracy in misappropriating AFP-RSBS funds and in
defrauding the government millions of pesos in capital gains and documentary
stamp taxes.
On January 28, 1999, after the requisite preliminary investigation, Special
Prosecutor Joy C. Rubillar-Arao filed twenty-four (24) separate Informations
with the Sandiganbayan against the petitioner and several other accused. The
filing of the Informations was duly approved by then Ombudsman Aniano A.
Desierto. The first twelve (12) Informations were for violation of Section 3(e) of
Rep. Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act,
docketed as Criminal Cases Nos. 25122 to 25133. All were similarly worded,
except for the names of the other accused, the dates of the commission of the
offense, and the property involved.
On the other hand, twelve (12) other separate Informations indicted the accused
for Falsification of Public Documents, defined and penalized under paragraph 4,
Article 171 of the Revised Penal Code, docketed therein as Criminal Cases Nos.
25134 to 25145. Save with respect to the names of the other accused, the dates
of the commission of the felonies, and the property involved in each case, the
Informations were, likewise, similarly worded, representative of which is that in
Criminal Case No. 25134.
On February 2, 1999, the petitioner filed an Urgent Motion to Dismiss the
Informations and to Defer the Issuance of Warrant of Arrest, alleging want of
jurisdiction. He, likewise, filed an Urgent Manifestation and Motion to Suspend
Proceedings on February 16, 1999, because of the pendency of his motion for
reinvestigation with the Office of the Ombudsman. The Office of the Special
Prosecutor opposed the said motions.
Meanwhile, pending resolution of the aforementioned motions, the law firm of
Albano & Associates filed a "Notice of Appearance" as private prosecutors in all
the aforementioned cases for the Association of Generals and Flag Officers, Inc.
(AGFOI) on March 9, 1999. The notice of appearance was apparently made
conformably to the letter-request of Retired Commodore Ismael Aparri and
Retired Brig. Gen. Pedro Navarro, who are members thereof.
In a Resolution dated April 5, 1999, the Sandiganbayan denied the earlier
motions filed by the petitioner for lack of merit. Consequently, a warrant of arrest
against him was issued. He posted a cash bail bond for his provisional liberty.
On April 6, 1999, the petitioner opposed the appearance of the law firm of Albano
& Associates as private prosecutors, contending that the charges brought against
him were purely public crimes which did not involve damage or injury to any
private party; thus, no civil liability had arisen.21 He argued that under Section 16
of the Rules of Criminal Procedure, "an offended party may be allowed to
intervene through a special prosecutor only in those cases where there is civil
liability arising from the criminal offense charged." He maintained that if the
prosecution were to be allowed to prove damages, the prosecution would
thereby be proving another crime, in violation of his constitutional right to be
informed of the nature of the charge against him.
Meanwhile, on June 6, 1999, the petitioner filed a "Motion for Reinvestigation".
with the Sandiganbayan, mentioning therein his unresolved motion for
reconsideration with the Office of the Ombudsman. He prayed that the
proceeding be suspended and his arraignment deferred pending the resolution
of the reinvestigation.
The Sandiganbayan granted the motion in its Order dated June 11, 1999.
In the meantime, in a Resolution dated June 9, 1999, the Sandiganbayan made
short shrift of the petitioner’s opposition and denied his plea for the denial of the
appearance of the law firm.
The petitioner moved for a reconsideration of the Sandiganbayan’s Resolution of
June 9, 1999, which was opposed by the prosecution. The Sandiganbayan issued
a Resolution denying the same on October 22, 1999.
ISSUE:
Whether or not, by nature, the subject criminal indictments for violations of
Section 3(e), Republic Act No. 3019 and Article 172, in relation to Article 171, of
the Revised Penal Code give rise to civil liability in favor of any private party. (NO)
RULING:
The AGFOI and/or Commodore Aparri and/or Brig. Gen. Navarro Are Not
the Offended Parties in the Informations filed Before the Sandiganbayan
The petitioner avers that the crimes charged are public offenses and, by their very
nature, do not give rise to criminal liabilities in favor of any private party. He
asserts that, as gleaned from the Informations in Criminal Cases Nos. 25122 to
25133 for violation of Section 3(e) of Rep. Act No. 3019, the offended party is the
government because based on the deeds of sale executed in favor of the AFP-
RSBS, as vendee, it was deprived of capital gains and the documentary stamp
taxes. He contends that the Informations in Criminal Cases Nos. 25134 to 25145,
for falsification of public document under paragraph 4, Article 171 of the Revised
Penal Code, do not contain any allegation that the AGFOI or any private party
sustained any damage caused by the said falsifications. The petitioner further
argues that absent any civil liability arising from the crimes charged in favor of
AGFOI, the latter cannot be considered the offended party entitled to participate
in the proceedings before the Sandiganbayan. According to the petitioner, this
view conforms to Section 16, Rule 110 of the Revised Rules of Criminal
Procedure, which reads:
SEC. 16. Intervention of the offended party in criminal action.— Where the
civil action for recovery of civil liability is instituted in the criminal action
pursuant to Rule 111, the offended party may intervene by counsel in the
prosecution of the offense.
The petitioner posits that the AGFOI is not a member, beneficiary or contributor
of the AFP-RSBS, and that even if it were so, it would not sustain a direct and
material damage by an adverse outcome of the cases. Allowing the AGFOI to
intervene would open the floodgates to any person similarly situated to intervene
in the proceedings and, thus, frustrate the speedy, efficient and inexpensive
disposition of the cases.
We agree with the contention of the petitioner that the AGFOI, and even
Commodore Aparri and Brig. Gen. Navarro, are not the offended parties
envisaged in Section 16, Rule 110, in relation to Section 1, Rule 111 of the Revised
Rules of Criminal Procedure.
Under Section 5, Rule 110 of the Rules, all criminal actions covered by a complaint
or information shall be prosecuted under the direct supervision and control of
the public prosecutor. Thus, even if the felonies or delictual acts of the accused
result in damage or injury to another, the civil action for the recovery of civil
liability based on the said criminal acts is impliedly instituted and the offended
party has not waived the civil action, reserved the right to institute it separately
or instituted the civil action prior to the criminal action, the prosecution of the
action inclusive of the civil action remains under the control and supervision of
the public prosecutor. The prosecution of offenses is a public function. Under
Section 16, Rule 110 of the Rules of Criminal Procedure, the offended party may
intervene in the criminal action personally or by counsel, who will act as private
prosecutor for the protection of his interests and in the interest of the speedy and
inexpensive administration of justice. A separate action for the purpose would
only prove to be costly, burdensome and time-consuming for both parties and
further delay the final disposition of the case. The multiplicity of suits must be
avoided. With the implied institution of the civil action in the criminal action, the
two actions are merged into one composite proceeding, with the criminal action
predominating the civil. The prime purpose of the criminal action is to punish the
offender in order to deter him and others from committing the same or similar
offense, to isolate him from society, reform and rehabilitate him or, in general, to
maintain social order.
On the other hand, the sole purpose of the civil action is for the resolution,
reparation or indemnification of the private offended party for the damage or
injury he sustained by reason of the delictual or felonious act of the accused.
Under Article 104 of the Revised Penal Code, the following are the civil liabilities
of the accused:
ART. 104. What is included in civil liability. – The civil liability established
in Articles 100, 101, 102 and 103 of this Code includes:
1. Restitution;
2. Reparation of the damage caused;
3. Indemnification for consequential damages.
Thus, when the offended party, through counsel, has asserted his right to
intervene in the proceedings, it is error to consider his appearance merely as a
matter of tolerance.
The offended party may be the State or any of its instrumentalities, including local
governments or government-owned or controlled corporations, such as the AFP-
RSBS, which, under substantive laws, are entitled to restitution of their
properties or funds, reparation, or indemnification. For instance, in malversation
of public funds or property under Article 217 of the Revised Penal Code, frauds
under Article 213 of the Revised Penal Code, and violations of the Forestry Code
of the Philippines, P.D. No. 705, as amended, to mention a few, the government is
the offended party entitled to the civil liabilities of the accused. For violations of
Section 3(e) of Rep. Act No. 3019, any party, including the government, may be
the offended party if such party sustains undue injury caused by the delictual acts
of the accused. In such cases, the government is to be represented by the public
prosecutor for the recovery of the civil liability of the accused.
Under Section 16, Rule 110 of the Revised Rules of Criminal Procedure, the
offended party may also be a private individual whose person, right, house,
liberty or property was actually or directly injured by the same punishable act or
omission of the accused, or that corporate entity which is damaged or injured by
the delictual acts complained of. Such party must be one who has a legal right; a
substantial interest in the subject matter of the action as will entitle him to
recourse under the substantive law, to recourse if the evidence is sufficient or
that he has the legal right to the demand and the accused will be protected by the
satisfaction of his civil liabilities. Such interest must not be a mere expectancy,
subordinate or inconsequential. The interest of the party must be personal; and
not one based on a desire to vindicate the constitutional right of some third and
unrelated party.
Hence, even if the members of AGFOI may also be members or beneficiaries of
the AFP-RSBS, the respondent AGFOI does not have a legal right to intervene in
the criminal cases merely and solely to enforce and/or protect the constitutional
right of such members to have access to the records of AFP-RSBS. Neither are
such members entitled to intervene therein simply because the funds of the AFP-
RSBS are public or government funds. It must be stressed that any interest of the
members of the AFP-RSBS over its funds or property is merely inchoate and
incidental. Such funds belong to the AFP-RSBS which has a juridical personality
separate and independent of its members/beneficiaries.
As gleaned from the Informations in Criminal Cases Nos. 25122 to 25133 for
violation of Section 3(e) of Rep. Act No. 3019, the offended party is the
government, which was allegedly deprived by the petitioner and the other
accused of the capital gains and documentary stamp taxes, based on the actual
and correct purchase price of the property stated therein in favor of the AFP-
RSBS. The AGFOI was not involved whatsoever in the sales subject of the crimes
charged; neither was it prejudiced by the said transactions, nor is it entitled to
the civil liability of the petitioner for said cases. Thus, it is not the offended party
in the said cases.
We agree with the petitioner that the AGFOI is not even the offended party in
Criminal Cases Nos. 25134 to 25145 for falsification of public documents under
paragraph 4, Sec. 1, Article 171, of the Revised Penal Code. It bears stressing that
in the felony of falsification of public document, the existence of any prejudice
caused to third person or the intent to cause damage, at the very least, becomes
immaterial. The controlling consideration is the public character of a document
and the violation of the public faith and the destruction of truth therein solemnly
proclaimed. The offender does not, in any way, have civil liability to a third
person.
However, if, in a deed of sale, the real property covered thereby is underpriced
by a public officer and his co-conspirators to conceal the correct amount of capital
gains and documentary stamp taxes due on the sale causing undue injury to the
government, the offenders thereby commit two crimes – (a) falsification of public
document defined in paragraph 4, Article 171 of the Revised Penal Code; and (b)
violation of Section 3(e) of Rep. Act No. 3019, a special penal law. The offender
incurs civil liability to the government as the offended party for violation of
Section 3(e) of Rep. Act No. 3019, but not for falsification of public document
under paragraph 4, Article 171 of the Revised Penal Code.
On the other hand, if, under the deed of sale, the AFP-RSBS was made liable for
the payment of the capital gains and documentary stamp taxes and, thereafter,
gave the correct amount thereof to the petitioner to be paid to the government,
and the petitioner and his co-accused pocketed the difference between the
correct amount of taxes and the amount entrusted for payment, then the AFP-
RSBS may be considered the offended party entitled to intervene in the above
criminal cases, through the Government Corporate Counsel.
In fine, the AGFOI is not the offended party entitled to intervene in said cases.
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The assailed
Resolutions of the Sandiganbayan are REVERSED and SET ASIDE. No costs. SO
ORDERED.
I. Disbarment cannot be entertained in a Disbarment Case
JOSE A. ROLDAN, COMPLAINANT, VS. ATTY. NATALIO PANGANIBAN AND
ATTY. JUANITO P. NOEL, RESPONDENTS.
A.C. No. 4552, December 14, 2004, AUSTRIA-MARTINEZ, J.
Facts:
Before us is an administrative case for disbarment filed by complainant Jose A.
Roldan against respondents Atty. Natalio M. Panganiban and Atty. Juanito P. Noel.
Complainant charges that respondent lawyers reneged in their duties and
obligations towards him as their client, especially in the complainant's right to
appeal to the higher court after losing his case in the lower courts. The allegations
in the complaint dated February 12, 1996[1] in support of the accusations are as
follows:
xxx
Na dahil dito sa mga panloloko, at pagwawalang bahala sa aking kaso ni
Atty. Noel, at Atty. Panganiban ay idinidimanda ko sila ng Damages na
halagang one hundred fifty thousand (P150,000.00) pesos at dapat
silang alisan ng karapatan na makapag-practice sa kanilang
propesyon.
Xxx
In his Comment dated August 8, 1996, Atty. Panganiban avers that he was neither
aware nor did he participate in the prosecution of "Civil Case No. 144860-CV
M.I.T. Branch 25 "Jose A. Roldan vs. Ramon Montano & Robert Montano" and in the
appeal of said case to the Regional Trial Court (RTC), Branch 43; they do not have
a lawyer-client relationship because he is on leave in the practice of law since
October 18, 1993 when he was designated Acting Mayor of Laurel, Batangas, and
during his incumbency as such, and up to the filing of this administrative
complaint in 1996, he is still on leave as law practitioner because he was elected
Mayor of Laurel, Batangas in the last 1995 election.
In his Comment, dated August 29, 1996, Atty. Noel alleges: Sometime in 1994, he
agreed to represent complainant in recovering a one-half portion of the ground
floor of a house located at 1723 Pedro Gil St., Paco, Manila which complainant
bought from one Simplicia Villanueva represented by her daughter Teresita
Dalusong on November 28, 1986. A civil complaint for recovery of ownership and
possession was filed on February 8, 1994 with the RTC but upon the effectivity of
the law expanding the jurisdiction of the Metropolitan Trial Court (MTC) the case
was transferred to the MTC. From the evidence of the defendant, he honestly saw
no need to present a rebuttal evidence. The MTC rendered a decision dismissing
the case on the alleged ground that the identity of the subject matter of the action
was not clearly established. He filed an appeal in due time to the RTC of Manila
(Branch 43) and not with the Court of Appeals as stated in paragraph 9 of the
complaint. On November 13, 1995, he received a copy of the RTC decision dated
October 10, 1995, affirming the decision of the MTC. Through the telephone, he
informed the complainant about the decision of the RTC. Complainant instructed
him to prepare an appeal to the higher court which actually refers to the Court of
Appeals and not with the Supreme Court as complainant claims. He advised the
complainant that he could find no error in the said decision and a further
appeal would be frivolous and without merit and requested the
complainant to come over so that he could discuss the matter with him.
Whenever the complainant went to the law office, he failed to see him because
the latter was still attending court hearings. The complainant asked for the
records of the case which was given by his secretary. Complainant never returned
the case folder to him, neither did he call up by phone, or see him personally. He
then assumed that the complainant had hired another lawyer to handle the
appeal. He was surprised when he received on July 18, 1996 a copy of the
resolution of this Honorable Court dated June 19, 1996, requiring them to file
their comment on the complaint of Jose A. Roldan.
After hearing, IBP Investigating Commissioner Manuel A. Quiambao submitted
his Report and Recommendation dismissing the complaint against Atty.
Panganiban and imposing censure to Atty. Noel. In a Resolution dated February
27, 2004, the IBP adopted and approved the said Report and Recommendation.
Issue:
1.. Whether there was a deliberate attempt to suppress evidence on the part of
Atty. Noel, to the prejudice of complainant. (No)
2. Whether it was correct for Atty. Noel to refuse to file a further appeal of the
case to the Court of Appeals by way of petition for review despite the manifest
desire of the complainant to do so. (Yes)
3. Whether or not damages can be awarded in the present disbarment case
against the respondents. (No)
Ruling:
1.. Complainant insists that Atty. Noel's failure to present in evidence the receipt
dated March 1, 1986 was fatal to his cause. The receipt shows that complainant
made a partial payment of P10,000.00 of the P40,000.00 price of the subject
property. Complainant claims that this piece of document proves that
complainant bought the subject property ahead of the defendants who bought it
only on July 30, 1986. Thus, to the mind of the complainant, the non-presentation
of the subject receipt is suppression of evidence.
Atty. Noel denied receiving the subject receipt and asserts that the same was
mere fabrication of the complainant. He insists that said receipt did not exist
during the preparation and filing of the complaint and even during the
presentation of evidence. Otherwise, he argues that such fact should have been
alleged in the complaint to show that complainant bought the subject property
ahead of the other buyer. Atty. Noel also claims that assuming that the receipt
was given to him, the same cannot be used as evidence because the receipt shows
that it was signed by one Romeo Dalusong who is not a party to the sale; neither
does it appear in the receipt that Romeo was acting in a representative capacity.
We find credence to the allegation of Atty. Noel that the subject receipt was not
in existence at the time he prepared the complaint or even at the time of
presentation of evidence. The complaint was verified by the complainant stating
the fact that he caused its preparation, that he read the same and attested that
the contents thereof are true and correct. If complainant's allegation that he gave
the receipt to Atty. Noel at that time, and considering the importance of the
subject receipt to his case, he should have called the attention of Atty. Noel that
there was no allegation of the existence of the subject receipt.
2. We note that the complainant was informed about the adverse RTC decision
within the 15-day prescriptive period to appeal. As stated elsewhere, Atty. Noel
received the adverse RTC decision on November 13, 1995 and the complainant
was informed about the adverse RTC decision on November 24, 1995. Hence,
complainant has still four days to file an appeal. However, Atty. Noel failed to
ensure that the client was advised appropriately. Atty. Noel entrusted entirely
with his secretary the duty to inform the complainant about the adverse decision.
And the secretary informed the complainant rather late and worse with the
wrong information that the complainant has still a month within which to file an
appeal. This resulted to the lapse of the prescriptive period to appeal without
complainant having availed of the said remedy.
A lawyer shall not neglect a legal matter entrusted to him and his negligence in
connection therewith shall render him liable. If only Atty. Noel's position of not
filing an appeal because it would only be frivolous has been properly
communicated to the complainant at the earliest possible time so that the
complainant would be able to seek the services of another lawyer for help, it
would have been commendable. A lawyer's duty is not to his client but to the
administration of justice; to that end, his client's success is wholly subordinate;
and his conduct ought to and must always be scrupulously observant of law and
ethics." But as it was, Atty. Noel's negligence as afore-discussed robbed the
complainant of the opportunity to at least look for another lawyer for
professional help and file an appeal, after all, it is the client who finally decides
whether to appeal or not an adverse decision.
We cannot also accept the reasoning of Atty. Noel that he should not be expected
to file an appeal for the complainant because their lawyer-client relationship
ended with the RTC decision. First, a lawyer continues to be a counsel of record
until the lawyer-client relationship is terminated either by the act of his client or
his own act, with permission of the court. Until such time, the lawyer is expected
to do his best for the interest of his client. Second, Atty. Noel admitted that
complainant instructed him to file an appeal with the higher court. Even
assuming that their contract does not include filing of an appeal with the higher
courts, it is still the duty of Atty. Noel to protect the interest of the complainant
by informing and discussing with the complainant of the said decision and his
assessment of the same. A lawyer shall represent his client with zeal within the
bounds of the law. It is the obligation of counsel to comply with his client's lawful
request. Counsel should exert all effort to protect the interest of his client.
3. Complainant's claim for damages cannot be entertained in the present
disbarment case as it is not the proper forum. It is not an ordinary civil case where
damages could be awarded. A disbarment case is a proceeding that is intended to
protect the Court and the public from the misconduct of its officers; to protect the
administration of justice by requiring that those who exercise this important
function shall be competent, honorable and reliable, men in whom courts and
clients may repose confidence. It has been emphasized in a number of cases that
disbarment proceedings belong to a class of their own, distinct from that of a civil
or a criminal action.
ANTONIO CONLU, Complainant, vs.ATTY. IRENEO AREDONIA, JR.,
Respondent.
A.C. No. 4955 September 12, 2011 VELASCO, JR., J.:
FACTS: Before the Court is a complaint for disbarment with a prayer for
damages instituted by Antonio Conlu (Antonio) against Atty. Ireneo Aredonia, Jr.
(Atty. Ireneo) on grounds of gross negligence and dereliction of sworn duty.
Antonio was the defendant in Civil Case. He engaged the services of Atty. Ireneo
to represent him in the case. The RTC rendered judgment3 adverse to Antonio.
Therefrom, Atty. Ireneo, for Antonio, appealed to the Court of Appeals (CA).The
CA eventually dismissed the appeal for non-filing of the appellant’s brief within
the reglementary period. Antonio got wind of the dismissal from his wife who
verified the status of the case. When confronted about the dismissal action, Atty.
Ireneo promised to seek reconsideration, which he did, but which the appellate
court later denied for belated filing of the motion. In that motion, Atty. Ireneo
averred receiving the adverted February 10, 1997 CA Resolution only on April
25, 1997, adding in this regard that the person in the law office who initially
received a copy of said resolution was not so authorized. However, the CA denied
the motion for having been filed out of time. As the CA would declare in a
subsequent resolution, there was a valid receipt by Atty. Ireneo, as shown by the
registry return card with his signature, of a copy of the CA’s February 10, 1997
Resolution.
In light of these successive setbacks, a disgusted Antonio got the case records
back from Atty. Ireneo and personally filed on October 13, 1997 another motion
for reconsideration. The CA again denied this motion for the reason that the
prejudicial impact of the belated filing by his former counsel of the first motion
for reconsideration binds Antonio. Forthwith, Antonio elevated his case to the
Court on a petition for certiorari but the Court would later dismiss the petition
and his subsequent motion to reconsider the denial.
Such was the state of things when Antonio lodged this instant administrative case
for disbarment with a prayer for damages. To support his claim for damages,
Antonio asserts having suffered sleepless nights, mental torture and
anguish as a result of Atty. Ireneo’s erring ways, besides which Antonio also
lost a valuable real property subject of Civil Case No. 1048.
Following Atty. Ireneo’s repeated failure to submit, as ordered, his comment, a
number of extensions of time given notwithstanding, the Court referred the
instant case, to its Office of the Bar Confidant (OBC) for evaluation, report and
recommendation. Acting on OBC’s Report and Recommendation, the Court
directed Atty. Ireneo to show cause within ten (10) days from notice—later
successively extended—why he should not be disciplinarily dealt with or held in
contempt for failing to file his comment and to comply with the filing of it.
At the IBP, Atty. Ireneo desisted from addressing his administrative case, his
desistance expressed by not attending the mandatory conference or filing the
required position paper. On the basis of the pleadings, the IBP-Commission on
Bar Discipline (CBD) found Ireneo liable for violating Canon 1, Rules 1.01 and
1.03 and Canon 18, Rule 18.03 of the Code of Professional Responsibility and
recommended his suspension from the practice of law for a period of six (6)
months, with warning. The IBP Board of Governors adopted and approved said
report and recommendation of the CBD.
ISSUES:
(1) WHETHER OR NOT ATTY. IRENEO VIOLATED THE CODE OF
PROFESSIONAL RESPONSIBILITY.
(2) WHETHER OR NOT DAMAGES CAN BE AWARDED – (TOPIC RELATED)
RULING:
(1) YES. We agree with the inculpatory findings of the IBP but not as to the level
of the penalty it recommended.
It must be remembered that a retained counsel is expected to serve the client
with competence and diligence. This duty includes not merely reviewing the
cases entrusted to the counsel’s care and giving the client sound legal advice, but
also properly representing the client in court, attending scheduled hearings,
preparing and filing required pleadings, prosecuting the handled cases with
reasonable dispatch, and urging their termination without waiting for the client
or the court to prod him or her to do so.
The failure to file a brief resulting in the dismissal of an appeal constitutes
inexcusable negligence. This default translates to a violation of the injunction of
Canon 18, Rules 18.03 and 18.04 of the Code of Professional Responsibility.
Atty. Ireneo tried to mislead the appellate court about the receipt of a copy of its
February 10, 1997 Resolution. He denied personally receiving such copy, but the
CA found and declared that he himself received said copy. The CA arrived at this
conclusion thru the process of comparing Atty. Ireneo’s signature appearing in
the pleadings with that in the registry return card. Both signatures belong to one
and the same person. Needless to stress, Atty. Ireneo had under the premises
indulged in deliberate falsehood, contrary to the self-explanatory prescriptions
of Canon 1, Rule 1.01 and Canon 10, Rule 10.01,
We cannot write finis to this case without delving into and addressing Atty.
Ireneo’s defiant stance against the Court as demonstrated by his repetitive
disregard of its resolution to file his comment on the basic complaint. After
requesting and securing no less than three (3) extensions of time to file his
comment, he simply closed, so to speak, communication lines. And when ordered
to give an explanation through a show-cause directive for not complying, he
asked for and was granted a 30-day extension. But the required comment never
came. When the Court eventually directed the NBI to arrest him, he just left his
last known address and could not be located.
What is clear to the Court by now is that Ireneo was determined all along not to
submit a comment and, in the process, delay the resolution of the instant case. By
asking several extensions of time to submit one, but without the intention to so
submit, Ireneo has effectively trifled with the Court’s processes, if not its
liberality. This cannot be tolerated And to be sure, Atty. Ireneo can neither defeat
this Court’s jurisdiction over him as a member of the bar nor evade
administrative liability by the mere ruse of concealing his whereabouts.
Manifestly, he has fallen short of the diligence required of every member of the
Bar. The pertinent Canon of the Code of Professional Responsibility which had
been violated is CANON 12 — Rule 12.03 and Rule 12.04.
In this case, Atty. Ireneo should be called to task for the interplay of the following:
his inexcusable negligence that resulted in the dismissal of Antonio’s appeal,
coupled by his lack of candor in not apprising Antonio of the status of his
appealed case; his attempt to mislead the CA; and, last but not least, his cavalier
disregard of the Court’s directives primarily issued to resolve the charges
brought against him by Antonio. We deem it fitting that Atty. Ireneo be suspended
from the practice of law for a period of one year, up from the penalty
recommended by the IBP Board of Governors.
(2) NO. The prayer for damages cannot be granted. Let alone the fact that Antonio
chose not to file his position paper before the IBP-CBD and, therefore, was unable
to satisfactorily prove his claim for damages, a proceeding for disbarment or
suspension is not in any sense a civil action; it is undertaken and prosecuted for
public welfare. It does not involve private interest and affords no redress for
private grievance.
J. HLURB, SEC AND DAR has jurisdiction to hear damages brought before them
AMA COMPUTER COLLEGE, INC., petitioner, 
vs.
JESUS R. FACTORA,
respondent.
G.R. No. 137911, THIRD DIVISION, February 27, 2002, SANDOVAL-
GUTIERREZ, J.:
FACTS:
Sevenis Enterprises, Inc. (Sevenis), owner of a parcel of land located at Edison St.,
Paranaque City, engaged the services of respondent Jesus R. Factora to construct
a four-storey condominium building on the said lot. To finance the construction,
Sevenis obtained a loan from Fund Centrum Finance, Inc in the amount of ₱3.9
million, secured by a mortgage on the realty project. Aside from this loan, Sevenis
has an existing obligation with respondent Factora in the amount of
₱1,333,523.00 as contractor's fees. On December 4, 1984, Sevenis' loan from
Fund Centrum became due. In order to settle in full all its obligations, Sevenis
entered into a Memorandum of Agreement (MOA) with Fund Centrum and
respondent Factora in June, 1985. The MOA contains the following pertinent
provisions:
"1. Dacion in Payment
To settle in full the obligation of the FIRST PARTY (Sevenis Enterprises,
Inc.) to the SECOND PARTY (Fund Centrum Finance, Inc.) as above-
stated, which as of June 30, 1985 is in the sum of ₱5,053,509.19, the
FIRST PARTY shall simultaneously herewith execute a Dacion in
Payment in favor of the SECOND PARTY, assigning and conveying to the
latter the land and improvements covered by aforesaid T.C.T. No. 64304.
2. Sevenis Plaza Project
As a resultant effect of the Dacion in Payment, as above described, the
SECOND PARTY shall become the owner of the land and realty project
construction therein, with the lien of THIRD PARTY expressly recognized
by all parties hereto;
Forthwith, Fund Centrum, being the new owner of the condominium building,
sold the same to Supreme Capital, Inc. (Supreme Capital). In turn, Supreme
Capital conveyed the property to MCI Real Estate and Development Corporation
(MCI). MCI then entered into a lease agreement with petitioner AMA Computer
College (AMA) which converted the condominium into a computer school. The
conversion included the three (3) 2-BR units assigned to respondent Factora per
the MOA. This prompted him to file two (2) complaints against Fund Centrum,
Supreme Capital and AMA with the Office of Appeals, Adjudication and Legal
Affairs (OAALA) of the Housing and Land Use Regulatory Board (HLURB) for
recovery of condominium certificates of title and damages.
The OAALA rendered a decision dismissing the complaints for lack of jurisdiction.
On appeal by respondent, the Board of Commissioners of the HLURB rendered
judgment on April 27, 1995 affirming the OAALA decision. Undaunted,
respondent elevated the decision of the HLURB to the Office of the President.
Then Executive Secretary Torres set aside the decision of the HLURB. Aggrieved
by the said decision, petitioner AMA filed a petition for review with the Court of
Appeals. On August 12, 1998, the Court of Appeals rendered the assailed Decision
dismissing AMA's petition.
ISSUE:
Whether or not the HLURB has jurisdiction over the cases filed with it.
RULING:
Petitioner AMA asserts that the HLURB has no jurisdiction to take cognizance of
the complaints filed by respondent Factora because the latter did not acquire
ownership of the subject condominium units pursuant to the MOA. Not being the
owner, he is not a condominium buyer within the purview of P.D. 957.
Sec. 1 of P.D. 1344 expanded the jurisdiction of the HLURB under P.D. 957,
otherwise known as "The Subdivision and Condominium Buyer's Protective
Decree," to include: (1) any claims filed by condominium buyer against the
project owner, developer, dealer, broker or salesman, and (2) cases involving
specific performance of contractual and statutory obligations filed by buyers of
condominium unit against the owner, developer, dealer, broker or salesman.
Corollarily, a transaction to "buy" and "purchase" under P.D. 957 has been
defined as "any contract to buy, purchase, or otherwise acquire for a valuable
consideration x x x a condominium unit in a condominium project." The term
"buyer" is not limited to those who enter into contracts of sale. Its concept is
broad enough as to include those who "acquire for a valuable consideration" a
condominium unit. Thus, a buyer of said unit seeking to enforce the performance
of an obligation arising from such transaction, or claiming damages therefrom,
may bring an action with the HLURB.
In the instant case, we rule that respondent is a buyer within the contemplation
of P.D. 957. He acquired the three condominium units as they were assigned to
him by Sevenis in payment for its indebtedness in the amount of ₱1,333,523.00
as contractor's fee. Clearly, his acquisition of the units was for a valuable
consideration.
While the MOA recognizes Sevenis' indebtedness as a lien, however, it expressly
provides for the settlement of such indebtedness by the assignment of the three
2-BR units to respondent. Thus, by virtue of the assignment, respondent relieved
Sevenis from its indebtedness to him.\The extinguishment of such indebtedness
vested upon respondent the right to own the said units.
Moreover, petitioner's theory that respondent is not the owner of the said
condominium does not preclude the HLURB from exercising its jurisdiction over
the case. As mentioned earlier, cases for specific performance of contractual
obligations against condominium owners filed by buyers fall within its
competence and expertise. In Arranza vs. B.F. Homes, Inc., this Court stressed the
peculiar nature of the transactions involving subdivisions and condominiums,
thus:
"P.D. 957 was promulgated to encompass all questions regarding subdivisions
and condominiums. It is aimed at providing for an appropriate government
agency, the HLURB, to which all parties aggrieved in the implementation of its
provisions and the enforcement of contractual rights with respect to said
category of real estate may take recourse."
DISPOSITIVE PORTION:
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals dated
August 12, 1998 in CA-GR SP No. 44472 is AFFIRMED. Let the records of the case
be remanded to the HLURB for further proceedings.
SO ORDERED.
ANTONIO M. GARCIA, petitioner, vs. COURT OF APPEALS and
PHILIPPINE EXPORT & FOREIGN LOAN GUARANTEE CORPORATION,
respondents.
FACTS: Garcia was a major stockholder and president of Dynetics, Inc., a
corporation primarily engaged in the manufacture of semi-conductors)
originally owning 43% of its outstanding shares of stock. In 1981, Asia
Reliability Co. Inc. (ARCI) obtained 28.98% interest in Dynetics. With the
said acquisition, the ownership structure of Dynetics became: petitioner
Garcia — 32.88%; ARCI — 28.78%; Vicente Chuidian (petitioner's
business partner and a major stockholder of ARCI) — 26%; and others —
11.26%. ARCI, through the initiative of Chuidian and with the guarantee
of respondent Philguarantee, acquired a foreign loan in the amount of
US$25,000,000.00 ostensibly to finance its various business projects.
However, the proceeds of the said loan were illegally diverted and used
for unauthorized purposes.
When ARCI defaulted in the payment of the aforestated loan, the foreign
creditors went after the guarantor, herein Philguarantee. In turn, the
latter filed cases for recovery against Chuidian, both here and in the
United States (where Chuidian fled). Unfortunately, Dynetics was caught
in the crossfire and became a battlefield for control between Chuidian
(who also owns, as previously stated, a substantial interest in Dynetics)
and Philguarantee.
Chuidian, as President of Interlek (the marketing arm of Dynetics,
organized and based in California, USA) ordered the company to stop its
remittances to Dynetics for the latter's assembly services which
amounted to approximately US$5,000,000.00. Consequently, Dynetics
filed a collection case against Interlek and Chuidian.
Thereafter, four (4) representatives of Philguarantee were assigned one
(1) qualifying share each in Dynetics. Thus, during the stockholders
meeting of Dynetics, the aforementioned nominees (Victor Macalindog,
Cesar Macuja, Eduardo Morato and Manuel Lazaro) were elected
members of the Board of Directors of Dynetics (although Lazaro did not
assume office). Garcia was the fifth member of the Board. Then, a
Settlement and Mutual Release Agreement (SMRA) was executed by and
between Dynetics and Chuidian and another between Philguarantee and
Chuidian for the purpose of finally putting an end to the numerous cases
filed by the aforestated parties against one another.
Garcia instituted a complaint for damages before the Regional Trial Court
and alleged that Philguarantee on its commitment, based on the
aforecited SMRA, to rehabilitate Dynetics and Chemark (a subsidiary
wholly owned by Dynetics) and this caused the financial ruin of the two
corporations. Dynetics and Chemark consequently defaulted on their
financial obligations and petitioner, in his capacity as guarantor, was held
personally liable. He was forced to compromise with the creditor banks in
the total amount of P145,000.000.00. He also contended that as a result,
likewise, of private respondent's failure to rehabilitate Dynetics and
because of the implementation of the "onerous" SMRA with Chuidian, the
book value of his shares in Dynetics plummeted, from P200.00 per share,
to practically zero. Lastly, he alleged that Dynetics incurred severe losses
due to the provision in the SMRA directing the said corporation to drop
the collection case it filed against Interlek and Chuidian for unpaid
remittances. Philguarantee filed a motion to dismiss but it was denied by
the RTC. The CA reversed and ruled that the controversy between
petitioner and private respondent is intra-corporate in nature and
therefore falls under the jurisdiction of the Securities and Exchange
Commission (SEC) and not the regular courts.
ISSUE: WON the SEC has jurisdiction over the action before it.
RULING: YES. Garcia persists in his argument that, being an action for
damages due to breach of contract, the present case is cognizable by the
regular courts and beyond the jurisdiction of the SEC, for, had private
respondent not withdrawn its commitment, petitioner rationalizes,
Dynetics would have regained its strong business position. Consequently,
it could have settled its obligations with its creditor banks and Garcia
would have been released from his obligations as surety. He also contends
that he is suing not as a stockholder of Dynetics but in his personal
capacity as the latter's aggrieved surety. Furthermore, Garcia avers that
his principal cause of action is "damages arising from breach of contract."
The other causes of action in his complaint are incidental claims which
emanate from and are the direct consequences of his main cause of action.
The petition is unmeritorious. Jurisdiction over the present
controversy is vested in the SEC and not in the regular courts. To
determine which body has jurisdiction over the present controversy, we
rely on the sound judicial principle that jurisdiction over the subject
matter of a case is conferred by law and is determined by the allegations
of the complaint irrespective of whether the plaintiff is entitled to all or
some of the claims asserted therein.
The law, P.D. 902-A, explicitly lays down the parameters of the Securities
and Exchange Commission's jurisdiction. Thus:
Sec. 5. In addition to the regulatory and adjudicative functions of the Securities and
Exchange Commission over corporation, partnerships and other forms of
associations registered with it as expressly granted under existing laws and decrees,
it shall have original and exclusive jurisdiction to hear and decide cases involving:
a) Devices or schemes employed by or any acts of the board of
directors, business associates, its officers or partners, amounting
to fraud and misrepresentation which may be detrimental to the
interest of the public and/or of the stockholders, partners,
members of associations or organizations registered with the
Commission.
b) Controversies arising out of intra-corporate or partnership relations,
between and among stockholders, members, or associates; between any
and/or all of them and the corporation, partnership or association of
which they are stockholders, members or associates, respectively; and
 between such corporation, partnership or association and the State insofar
as it concerns their individual franchise or right to exist as such entity.
c) Controversies in the election or appointments of directors, trustees,
officers or managers of such corporations, partnerships, or associations.
d) Petition of corporations, partnerships or associations to be declared in
the state of suspension of payments in cases where the corporation,
partnership or association possess sufficient property to cover all of its
debts but foresees the impossibility of meeting them when they respectively
fall due or in cases where the corporation, partnership or association has
no sufficient assets to cover its liabilities but is under the Management
Committee created pursuant to this Decree.
Jurisprudence, however, has tempered the aforequoted provision,
paragraph (b) in particular:
. . . The better policy in determining which body has jurisdiction over a case
would be to consider not only the status or relationship of the parties but
also the nature of the question that is the subject of their controversy.
The case at bar is a classic illustration of a dispute between stockholders
— private respondent, the current majority and controlling stockholder
of Dynetics and petitioner, the erstwhile majority stockholder of said
corporation (although he still holds a substantial interest therein).
Garcia’s stubborn insistence that he brought the case for damages in his
capacity as an aggrieved surety and not as a stockholder is belied by the
opening statement in his complaint, which states that he was and still is a
major stockholder of Dynetics. More importantly, Garcia became a surety
of Dynetics and Chemark because he was then one of the principal
stockholders of Dynetics. This was a requisite of the creditor banks.
Petitioner's character as surety for Dynetics, therefore, can even be traced
to and is interlocked with the fact that he is a major stockholder of the said
corporation.
Since both parties in the case at bar are stockholders of the corporation,
jurisdiction over their present conflict vests in the SEC pursuant to Sec.
5(b) of P.D. 902-A. However, there remains to be a next test to determine
whether or not the SEC has jurisdiction over the matter to the exclusion
of regular courts—which is whether or not the nature of the controversy
itself is intra-corporate.
Garcia attributes to the SMRA the commitment of Philguarantee to
rehabilitate Dynetics and Chemark. This is the reason why, when
Philguarantee withdrew the restructuring plans for the rehabilitation of
the aforementioned corporations, Garcia instituted a complaint for
breach of contract. The problem with this scenario, however, is that he
failed to indicate the exact provision where this specific promise is
embodied. Instead, he merely presented a letter sent by the Chairman of
the Board of Directors of Dynetics entitled "Proposed Integrated Financial
Plan for the Rehabilitation of Dynetics, Inc., Asian Reliability Company,
Inc. and Chemark Electric Motors, Inc."
From that letter, it can be seen that that the proposed rehabilitation
program for the said corporation was made by Philguarantee in its
capacity as the majority or controlling stockholder of Dynetics. The
rehabilitation plan was a corporate decision and a corporate action. The
root of Garcia’s complaint therefore, no matter how cleverly devised and
artfully disguised is plainly a corporate affair and being so, jurisdiction
over the dispute at bar pertains to the SEC and not to the regular courts.
As held by the CA, the fact remains that the claim for damages either
depends on, or is inextricably linked with, the resolution of the corporate
controversies. For instance, the prayer for moral and exemplary damages
is grounded on "defendant's total bad faith and malice knowing fully well
that its acts were patently injurious to the rights and interests of said
corporations and its stockholders, including plaintiff . . ." . . . Clearly, what
Philguarantee filed against Garcia before the court below was an intra-
corporate case under the guise of an action for damages employing civil
law terms and phrases.
The principal function of the SEC is the supervision and control over
corporations, partnerships and associations with the end in view that
investment in these entities may be encouraged and protected and their
activities pursued for the promotion of economic development.
It is in aid of this office that the adjudicative power of the SEC must be
exercised. Thus the law explicitly specified and delimited its jurisdiction
to matters intrinsically connected with the regulation of corporations,
partnerships and associations and those dealing with the internal affairs
of such corporations, partnerships or associations.
WHEREFORE, premises considered, the petition for review on certiorari
is hereby DENIED.
SO ORDERED.
SECOND DIVISION
[G.R. No. L-26933. October 18, 1977.]
CESAR JAYME AND CONCHITA JAYME, Petitioners, v. JUDGE SEVERIANO DE
LEON, REYNOLD S. FAJARDO, FLAVIANO ALENTORIO, PEDRO ALLIEZA,
ERNESTO CANDIDO, ROMEO CANDIDO, FRANCISCO CRISOSTOMO, JESUS
CRISOSTOMO, JESUS CAONTOY, PROFIRIO SOLLAR, MELCHOR PALERMO,
FLOR DELGADO, FERNANDO TAGACAY, and COMMERCIAL & AGRO-
INDUSTRIAL LABOR ORGANIZATION (CAILO), Respondents.
Facts:
A complaint for unfair labor practice was filed with the Court of Agrarian
Relations (CAR) of Bacolod City, by Reynold S. Fajardo, an attorney of the Court
of Agrarian Relations, Quezon City, after conducting a preliminary investigation
of the unfair labor practice charged filed by private respondents. A motion to
dismiss filed by herein petitioners was denied by respondent Judge.
Petitioners, in asserting "that respondent, Judge Severiano de Leon, has acted
without and/or in excess of his jurisdiction (in) denying petitioners’ motion to
dismiss relies on the following allegations —
"10. That the above mentioned case for unfair labor practice is outside the
jurisdiction of the respondent Judge the same being in violation of Sec. 155,
Republic Act No. 3844 otherwise known as the Land Reform Code and Republic
Act No. 2367 which specifically prescribed the Rules of Procedures of the Court
of Agrarian Relations in pursuant to Section 10 of Republic Act 1267 and the
Revised Rules of Court;
"11. That the Court of Agrarian Relations has no jurisdiction to hear cases the
complaint of which is fatally defective for want of signatures of the proper party
in interest in violation of the Rules of Court, Republic Act 1267 and Republic Act
3844;
"12. That the respondent Judge has likewise no jurisdiction to entertaining cases
where moral and/or exemplary damages are asked for, these matters falling
exclusively within the jurisdiction of the ordinary court of justice;
Issue:
WON the Court of Agrarian Relations can award damages
Ruling:
YES. With respect to the second question on the jurisdiction of the Court of
Agrarian Relations to award moral and exemplary damages and attorney’s fees
in the concept of damages, suffice it to state that said Courts are vested with
such authority not only because the Courts of Agrarian Relations have all
the powers and prerogatives inherent in or belonging to the Courts of First
Instance; but also, procedurally, to require private respondents to split their
causes of action and seek redress in different Courts would be to encourage
multiplicity of suits which is abhorred in the interest of orderly
administration of justice.
On the last contention of petitioners that respondent Court "cannot entertain
matters where differential pay is alleged in the complaint for unfair labor
practice" Sec. 154, par. (2), in relation to Secs. 42 and 47 of Republic Act No. 3844
clearly vest in the Courts of Agrarian Relations the jurisdiction to try and decide
cases involving violations of minimum wage fixed by law, or regulations issued
by the Department of Labor, for agricultural workers. 19
Finally, on the need for further proceedings and the proper forum for the same.
We have thus arrived at the conclusion that this Petition is without merit and,
therefore, further proceedings will be necessary in CAR Case No. L-229 Neg. Occ.
But in the meantime that this Petition was pending before this Court, Pres. Decree
442, otherwise known as Labor Code of the Philippines, was promulgated and
became effective on May 1, 1974. Under the said Code, as amended by Pres.
Decree 570-A promulgated on November 1, 1974, the Courts of Agrarian
Relations have been divested of jurisdiction over disputes and controversies
involving agricultural workers and the authority to try the same was vested in
Labor Arbiters with appellate recourse to the National Labor Relations
Commission. However, the Transitory and Final Provisions of the Code, as
amended, contain no provision for the transfer of agricultural labor cases
pending before Courts of Agrarian Relations to the National Labor Relations
Commission. This notwithstanding and with the promulgation and effectivity of
Pres, Decree 946, on June 17, 1976, further proceedings in this case now properly
fall within the jurisdiction of Labor Arbiters and the National Labor Relations
Commission. The records of CAR Case No. L-229 should therefore he transferred
to the Labor Arbiter at Bacolod for further proceedings.
WHEREFORE, the Petition is hereby DENIED. The writ of preliminary injunction
issued on August 3, 1967 is hereby DISSOLVED. Let the records of CAR Case No.
L-229 of the Court of Agrarian Relations, Branch I, Bacolod City, be transferred to
the Office of the Labor Arbiter thereat for further proceedings. Costs against
petitioners.
SO ORDERED.
K. Prayer for Damages must be alleged in the complaint; Reason
DAVAO LIGHT AND POWER CO., INC., Petitioner, v. HON. CRISTETO D.
DINOPOL, Presiding Judge of Branch XIII, Regional Trial Court of Davao City,
and ABUNDIO T. MERCED, Respondents.
G.R. No. L-75195, THIRD DIVISION, August 29, 1988, FERNAN, C.J.
FACTS:Private respondent Abundio T. Merced doing business under the name
and style of Southern Engineering Works, filed an action in the trial court for
damages with preliminary mandatory injunction against petitioner Davao Light
and Power Co., Inc. for abruptly disconnecting his electric meter as a result of
which he suffered moral damages, loss of business and credit standing, and loss
of profits.
In his original and amended complaints, private respondent did not quantify his
various claims for damages except for attorney’s fees of P20,000.00 and expenses
of litigation of P5,000.00. In both complaints, he stated that his principal claims
would either be proven at the trial or left to the discretion of the court. As a
consequence, he was only required to pay docket fees amounting to P82.50 based
on the quantified claims for attorney’s fees and expenses of the suit.
In his direct examination, private respondent finally declared the specific
amounts of his principal demands as follows P2,000,000 for loss of business and
credit standing; P5,000,000 for moral damages, and P1,845,384.50 for loss of
profits from cancelled job orders and proposals, or a grant total of P8,845,384.50.
Petitioner filed a motion and supplemental motion, respectively, to require
private respondent to pay additional docket fees on his quantified claims for
damages, alleging that pursuant to Batas Pambansa Blg. 129 and Section 5 of Rule
141 of the Rules of Court, he is supposed to pay graduated docket fees based on
the total amount of his money claims, or an additional sum of P35,080.00 as
assessed by the clerk of court.
Respondent Judge Dinopol denied the two motions, reasoning out that while the
determination of the amount of the filing fees is at the time the action is filed,
there is no law which prohibits claims to be proven during the trial or that the
assessment thereof be left to the sound discretion of the court. Moreover, it is
premature to require another assessment for filing fees as the court has yet to
determine whether the moral damages and business losses allegedly incurred by
therein plaintiff Merced were by reason of the acts of therein defendant Davao
Light and Power Co., Inc. Furthermore, respondent judge stated that in the event
he awards a monetary judgment, the filing fees shall be a lien on said award.
Petitioner filed a motion for reconsideration. When more than four (4) months
had elapsed without respondent judge resolving the same, petitioner took the
instant recourse.
Petitioner contends that respondent judge has the clear and positive duty to
enforce the provisions of the Rules of Court requiring the payment of docket fees,
the amount of which is based on the total amount of the various claims. Where he
evades that duty or when he virtually refuses to perform that duty by denying
petitioner’s motion to require private respondent to pay additional docket fees
and by sitting on petitioner’s motion for reconsideration for an unreasonable
length of time, he clearly acts in excess of jurisdiction and with grave abuse of
discretion.
ISSUE: Whether or not the totality rule applies in this case.
RULING: YES. The Interim Rules of Court provide:
Rule 11. Application of the totality rule. — In actions where the
jurisdiction of the court is dependent on the amount involved, the test of
jurisdiction shall be the aggregate sum of all the money demands,
exclusive only of interest and costs, irrespective of whether or not the
separate claims are owned by or due to different parties. If any demand
is for damages in a civil action, the amount thereof must be specifically
alleged.
The last sentence of Rule 11 is new. While the accepted practice in the past was
where the damages alleged in a civil complaint were not specified, the action
would pertain to the jurisdiction of the courts of first instance, under the Interim
Rules, this no longer holds true. All claims for damages must now be
specifically alleged for the purpose of determining jurisdiction. This
innovation is aimed at doing away with the pernicious practice by litigants of
omitting any specification of the amount of damages in the complaint, not only to
be able to choose the forum for their case, but also in order to mislead the docket
clerk in the assessment of the filing fees and thus evade the payment of the
correct charges.
This Court, in the case of Manchester Development Corporation, Et. Al. v. Court of
Appeals, Cityland Development Corporation, Et Al., G.R. No. 75919, May 7, 1987,
minced no words in condemning such unethical practice. For the guidance of the
bench and bar it formulated the following guideline:
"The Court serves warning that it will take drastic action upon a
petition of this unethical practice. To put a stop to this irregularity,
henceforth, all complaints, petitions, answers and other similar
pleadings should specify the amount of damages being prayed for
not only the body of the pleading but also in the prayer, and said
damages all be considered in the assessment of the filing fees in any
case. Any pleading that fails to comply with this requirement shall not
be accepted nor admitted, nor shall otherwise be expunged from the
record."
If we were to apply the ruling in the Manchester Development Corporation case,
all the proceedings held in connection with Civil Case No. 17122 should
peremptorily be considered null and void because, for all legal purposes, the trial
court ever acquired jurisdiction over the case by the payment of only P82.50 as
filing fees.
The Court, however, takes note of the fact that the assailed Order of February 14,
1986 was issued prior to the resolution the aforecited Manchester Development
Corporation case. Its strict application to the case at bar would therefore be
unduly harsh.
DISPOSITIVE PORTION:
WHEREFORE, the instant petition is GRANTED. The questioned Order of
February 14, 1986 is hereby set aside. However, so as not to further delay the
adjudication of the subject civil suit for damages, private respondent Abundio T.
Merced is given a non-extendible period of five (5) days from notice of this
decision to AMEND his complaint by specifying the amount of damages being
sought, not only in the body of the pleading but also in the prayer, or his action
will be DISMISSED. The docket clerk should base the assessment of the filing fees
on the aggregate amount of the demand appearing in the complaint.
Respondent Judge Cristeto D. Dinopol is ADMONISHED to strictly adhere to the
guideline laid down in the Manchester Development Corporation resolution to
preclude a recurrence of a similar incident to the end that the courts will not be
deprived of the correct docket fees. SO ORDERED.
L. Damages in Intellectual Property Cases
VENANCIO SAMBAR, doing business under the name and style of CVS
Garment Enterprises, petitioner, vs. LEVI STRAUSS & CO., and LEVI STRAUSS
(PHIL.), INC., respondents. | G.R. No. 132604, SECOND DIVISION, March 6,
2002, QUISUMBING, J.
FACTS:
Levi Strauss & Co., and Levi Strauss Phil, Inc., through a letter from their legal
officer, demanded that CVS Garment Enterprises (CVSGE) desist from using their
stitched arcuate design on the Europress jeans which CVSGE advertised in the
Manila Bulletin.
Atty. Benjamin Gruba, counsel of CVSGE, replied that the arcuate design on the
back pockets of Europress jeans was different from the design on the back
pockets of Levi’s jeans. He further asserted that his client had a copyright on the
design it was using.
Thereafter, private respondents filed a complaint against Sambar, doing business
under the name and style of CVSGE. Private respondents also impleaded the
Director of the National Library.
Private respondents alleged in their complaint that Levi Strauss and Co. (LS&Co.),
an internationally known clothing manufacturer, owns the arcuate design
trademark which was registered under U.S. Trademark Registration No. 404, 248
on November 16, 1943, and in the Principal Register of trademarks with the
Philippine Patent Office under Certificate of Registration No. 20240 issued on
October 8, 1973; that through a Trademark Technical Data and Technical
Assistance Agreement with Levi Strauss (Phil.) Inc. (LSPI) in 1972, LS&Co,
granted LSPI a non-exclusive license to use the arcuate trademark in its
manufacture and sale of Levi’s pants, jackets and shirts in the Philippines; that in
1983, LS&Co. also appointed LSPI as its agent and attorney-in-fact to protect its
trademark in the Philippines; and that sometime in 1987, CVSGIC and Venancio
Sambar, without the consent and authority of private respondents and in
infringement and unfair competition, sold and advertised, and despite demands
to cease and desist, continued to manufacture, sell and advertise denim pants
under the brand name “Europress” with back pockets bearing a design similar to
the arcuate trademark of private respondents, thereby causing confusion on the
buying public, prejudicial to private respondents’ goodwill and property right.
In its answer, CVSGIC admitted it manufactured, sold and advertised and was still
manufacturing and selling denim pants under the brand name of “Europress,”
bearing a backpocket design of two double arcs meeting in the middle. However,
it denied that there was infringement or unfair competition because the display
rooms of department stores where Levi’s and Europress jeans were sold, were
distinctively segregated by billboards and other modes of advertisement. CVSGIC
avers that the public would not be confused on the ownership of such known
trademark as Levi’s, Jag, Europress, etc. Also, CVSGIC claimed that it had its own
original arcuate design which was very different and distinct from Levi’s design.
CVSGIC prayed for actual, moral and exemplary damages by way of counterclaim.
Petitioner Venancio Sambar filed a separate answer. He denied he was connected
with CVSGIC. He admitted that Copyright Registration No. 1-1998 was issued to
him, but he denied using it. He also said he did not authorize anyone to use the
copyrighted design. He counterclaimed for moral and exemplary damages and
payment of attorney’s fees.
After hearing, the trial court issued a writ of preliminary injunction enjoining
CVSGIC and petitioner from manufacturing, advertising and selling pants with the
arcuate design on their back pockets. The trial court also ordered the defendants
CVS Garment and Industrial Company and Venancio Sambar to pay the plaintiffs
jointly and solidarily the sum of P50,000.00 as temperate and nominal damages,
the sum of P10,000.00 as exemplary damages, and the sum of P25,000.00 as
attorney’s fees and litigation expenses and to pay the costs.
The Court of Appeals affirmed the decision of the trial court in toto.
ISSUE/S:
Whether or not the petitioner infringe on private respondents’ arcuate design.
(YES)
Whether or not the petitioner is solidarity liable with CVS Garments Industrial
Corporation. (YES)
Whether or not private respondents are entitled to nominal, temperate and
exemplary damages and cancellation of petitioner’s copyright. (NO)
RULING:
Whether or not the petitioner infringe on private respondents’ arcuate design.
The first issue raised by petitioner is factual. The basic rule is that factual
questions are beyond the province of the Supreme Court in a petition for review.
Although there are exceptions to this rule, this case is not one of them. Hence, the
Court find no reason to disturb the findings of the Court of Appeals that
Europress’ use of the arcuate design was an infringement of the Levi’s design.
Whether or not the petitioner is solidarity liable with CVS Garments Industrial
Corporation.
Again, this is a factual matter and factual findings of the trial court, concurred in
by the Court of Appeals, are final and binding on the Supreme Court. Both the
courts below found that petitioner had a copyright over Europress’ arcuate
design and that he consented to the use of said design by CVSGIC. The SC is bound
by this finding, especially in the absence of a showing that it was tainted with
arbitrariness or palpable error. It must be stressed that it was immaterial
whether or not petitioner was connected with CVSGIC. What is relevant is that
petitioner had a copyright over the design and that he allowed the use of the same
by CVSGIC. Also, petitioner did not deny that private respondents owned the
arcuate trademark nor that CVSGIC used on its products a similar arcuate design.
What he averred was that although he owned the copyright on the Europress
arcuate design, he did not allow CVSGIC to use it. He also said he was not
connected with CVSGIC. These were not alleged by private respondents in their
pleadings, and petitioner therefore had the burden to prove these.
Whether or not private respondents are entitled to nominal, temperate and
exemplary damages and cancellation of petitioner’s copyright.
The SC agrees with petitioner that it was error for the Court of Appeals to affirm
the award of nominal damages combined with temperate damages by the
Regional Trial Court of Makati. What respondents are entitled to is an award for
temperate damages, not nominal damages. For although the exact amount of
damage or loss can not be determined with reasonable certainty, the fact that
there was infringement means they suffered losses for which they are entitled to
moderate damages. The Court find that the award of P50,000.00 as temperate
damages fair and reasonable, considering the circumstances herein as well as the
global coverage and reputation of private respondents Levi Strauss & Company
and Levi Strauss (Phil.), Inc.
DISPOSITIVE PORTION:
WHEREFORE, the decision dated January 30, 1998, of the Court of Appeals, in CA-
G.R. CV No. 51553 AFFIRMING the judgment of the Regional Trial Court of Makati,
Branch 66, dated July 14, 1995, is hereby MODIFIED so that nominal damages are
deleted but the amount of P50,000 is hereby awarded only as TEMPERATE
DAMAGES. In all other respects, said judgment is hereby AFFIRMED, to wit:
a. the writ of preliminary injunction is made permanent;
b. the defendants CVS Garment and Industrial Company and Venancio
Sambar are ordered also to pay the plaintiffs jointly and solidarily the sum of
P10,000.00 as exemplary damages, and the sum of P25,000.00 as attorney’s
fees and litigation expenses, and to pay the costs; and
c. the Director of the National Library is ordered to cancel the Copyright
Registration No. 1-1998 issued in the name of Venancio Sambar.
SO ORDERED.
- SAB
N. Instances where no damages may be awarded under the Assurance Fund
LA URBANA, SOCIEDAD MUTUA DE CONSTRUCCION Y PRESTAMOS,
Plaintiff-Appellant, vs. MATEO BUENAVENTURA ET AL., Defendants-
Appellees.
THE INSULAR TREASURER and ANTONIA RODRIGUEZ, appellants.
G.R. No. L-41916, EN BANC, January 8, 1936, IMPERIAL, J.
FACTS:
In the complaints filed in the two cases which were jointly heard and in which
only one decision was rendered, the plaintiff alleged two causes of action against
the defendants In the first, it stated that 16 transfer certificates of title had been
illegally issued over lands of which it was the sole and absolute owner and for
which it had, in turn, obtained a transfer certificate of title, and prayed that said
16 titles be declared null and void and cancelled. In the second, it prayed that,
should cancellation be not in order, judgment be rendered in its favor and against
all the defendants and the assurance fund, in particular, for damages to it
resulting from the loss of the portions of land included in the aforesaid titles.
The court rendered judgment declaring the validity of the 9 titles included in the
first case, and, consequently, the absolute ownership by the persons to whom
they were issued, and allowed the plaintiff indemnity, either from the assurance
fund or from Juan T. Tabien and his wife. The judgment in the second case found
the 7 titles there in question null and void, and, consequently, declared the
plaintiff the owner of the portions of land covered thereby, and awarded
indemnity from the assurance fund to the persons to whom they were issued in
the following proportion was likewise ordered with respect to the plaintiff that
no execution of the judgment be issued against Insular Treasurer until it is shown
that the indemnity allowed could not be paid partially or totally by the spouses
Tabien.
ISSUE:
Whether the plaintiff is entitled to the indemnity claimed by it from the assurance
fund.
RULING:
To obtain a judgment for damages against the assurance fund, by reason of
deprivation or loss of registered land, section 101 requires that the person who
claims damages should not have been negligent in acquiring the property or in
obtaining the registration thereof in his name. Plaintiff's negligence is manifest in
the instant case because with its knowledge of the pending litigation and of the
notices of lis pendens it should not have taken the risk of purchasing the property
if it had acted prudently. As it chose to run the risk, it must suffer the
consequences of its own acts.
The case prevents another aspect the solution of which leads us to the same
result. Under section 101 the damages given are for the deprivation or loss of
registered lands or of real rights over them. Generally speaking the assurance
found has nor been established to enrich the registered owners. There are cases,
of course, where the registered owner might suffer damages, besides
compensable injury, but the case before us is different. Plaintiff claims damages
because it has been deprived of certain portions of land which were included in
the title obtained by it. But it has been established that by virtue of the six cases,
the parties affected were compelled to redeem their property by paying the
plaintiff the sum of P41,780.70. As its capital was P23,000 only, and the price it
be paid for the land at the auction sale did not exceed P24,540, it is evident that
it obtained a profit amounting to P17,240.70. In view of this notoriously lucrative
transaction for the plaintiff, we do not feel inclined to hold that it still has the right
to claim damages from the assurance fund.
-Rochelle
O. The Supreme Court cannot award damages in Writ of Kalikasan cases
WEST TOWER CONDOMINIUM CORPORATION, on behalf of the Residents
of West Tower Condominium and in representation of Barangay Bangkal,
and others, including minors and generations yet unborn, Petitioners,
vs.
FIRST PHILIPPINE INDUSTRIAL CORPORATION, FIRST GEN CORPORATION
and their RESPECTIVE BOARD OF DIRECTORS AND OFFICERS, JOHN DOES,
and RICHARD DOES, Respondents.
GR. No. 194239 June 16, 2015 VELASCO, JR., J.
FACTS:
Respondent FPIC operates two pipelines since 1969, viz: (1) the White Oil
Pipeline (WOPL) System, which covers a 117-kilometer stretch from Batangas to
the Pandacan Terminal in Manila and transports diesel, gasoline, jet fuel and
kerosene; and (b) the Black Oil
Pipeline (BOPL) System, which extends 105 kilometers and transports bunker
fuel from Batangas to a depot in Sucat, Parañaque. These systems transport
nearly 60% of the petroleum requirements of Metro Manila and parts of the
provinces of Bulacan, Laguna, and Rizal.
In May 2010, however, a leakage from one of the pipelines was suspected after
the residents of West Tower Condominium (WestTower) started to smell gas
within the condominium. A search made on July 10, 2010 within the
condominium premises led to the discovery of a fuel leak from... the wall of its
Basement 2. Owing to its inability to control the flow, WestTower’s management
reported the matter to the Police Department of Makati City, which in turn called
the city’s Bureau of Fire Protection.
What started as a two-drum leak at the initial stages became a 15-20 drum a day
affair. Eventually, the sump pit of the condominium was ordered shut down by
the City of Makati to prevent the discharge of contaminated water into the
drainage system of Barangay Bangkal.
Eventually, the fumes compelled the residents of West Tower to abandon their
respective units on July 23, 2010 and the condo’s power was shut down. On
November 15, 2010, West Tower Condominium Corporation (West Tower Corp.)
interposed the present Petition for the Issuance of a Writ of Kalikasan on behalf
of the residents of West Tower and in representation of the surrounding
communities in Barangay Bangkal, Makati City. West Tower Corp. also alleged
that it is joined by the civil society and several people’s organizations, non-
governmental organizations and public interest groups who have expressed their
intent to join the suit because of the magnitude of the environmental issues
involved.
On November 19, 2010, the Court issued the Writ of Kalikasan[2] with a
Temporary Environmental Protection Order (TEPO) requiring respondents FPIC,
FGC, and the members o... f their Boards of Directors to file their respective
verified returns. The TEPO... enjoined FPIC and FGC to: (a) cease and desist from
operating the WOPL until further orders; (b) check the structural integrity of the
whole span of the 117-kilometer WOPL while implementing sufficient measures
to prevent and avert any untoward incident that may result from any leak of the
pipeline; and (c) make a report thereon within 60 days from receipt thereof.
Meanwhile, on January 18, 2011, FGC and the members of its Board of Directors
and Officers filed a Joint CompliancE submitting the report required by the Writ
of Kalikasan/TEPO. They contended that they neither own nor operate the
pipelines,... adding that it is impossible for them to report on the structural
integrity of the pipelines, much less to cease and desist from operating them as
they have no capability, power, control or responsibility over the pipelines. They,
thus, prayed that the directives of the Writ of Kalikasan/TEPO be considered as
sufficiently performed, as to them.
On January 21, 2011, FPIC, in compliance with the writ, submitted its 4-page
“Report on Pipeline Integrity Check and Preventive Maintenance Program.” Since
after the Court’s issuance of the Writ of Kalikasan and the TEPO on November 19,
2010, FPIC has ceased operations on both the WOPL and the BOPL. On May 31,
2011, however, the Court, answering a query of the DOE, clarified and confirmed
that what is covered by the Writ of Kalikasan and TEPO is only the WOPL System
of FPIC; thus, FPIC can resume operation of its BOPL System.
To expedite the resolution of the controversy, the Court remanded the case to the
Court of Appeals (CA). By this Court’s Resolution dated November 22, 2011, the
appellate court was required to conduct hearings and, thereafter, submit a report
and... recommendation within 30 days after the receipt of the parties’
memoranda.
On January 11, 2013, petitioners filed their Motion for Partial
Reconsideration[19] of the CA’s Report praying that (a) instead of the DOE, the
required certification should be issued by the DOST-Metal Industry Research and
Development Center; (b) a trust... fund be created to answer for future
contingencies; and (c) the directors and officers of FPIC and FGC be held
accountable.
On July 30, 2013, the Court issued a Resolution adopting the recommendation of
the CA in its Report and Recommendation that FPIC be ordered to secure a
certification from the DOE Secretary before the WOPL may resume its operations.
Having received the October 25, 2013 Certification and the August 5, 2014 Letter
from the DOE on the state of the WOPL, as well as the parties’ comments thereon,
the following issues defined by the parties during the March 21, 2012 preliminary
conference are now ripe for adjudication
Issues:
1. Whether petitioner West Tower Corp. has the legal capacity to
represent the other petitioners and whether the other petitioners, apart
from the residents of West Tower and Barangay Bangkal, are real
parties-in-interest;
2. Whether a Permanent Environmental Protection Order should be
issued to direct the respondents to perform or to desist from performing
acts in order to protect, preserve, and rehabilitate the affected
environment;
3. Whether a special trust fund should be opened by respondents to
answer for future similar contingencies; and
4. Whether FGC and the directors and officers of respondents FPIC
and FGC may be held liable under the environmental protection order.
(TORTS and DAMAGES ISSUE)
Ruling:
Residents of West Tower and Barangay Bangkal
As defined, a real party-in-interest is the party who stands to be benefited or
injured by the judgment in the suit, or the party entitled to the avails of the
suit.[39] Generally, every action must be prosecuted or defended in the name of
the real... parties-in-interest.[40] In other words, the action must be brought by
the person who, by substantive law, possesses the right sought to be
enforced.[41] Alternatively, one who has no right or interest to protect cannot
invoke the... jurisdiction of the court as party-plaintiff-in-action for it is
jurisprudentially ordained that every action must be prosecuted or defended in
the name of the real party-in-interest.
In the case at bar, there can be no quibble that the oil leak from the WOPL affected
all the condominium unit owners and residents of West Tower as, in fact, all had
to evacuate their units at the wee hours in the morning of July 23, 2010, when the
condominium’s electrical power... was shut down. Until now, the unit owners and
residents of West Tower could still not return to their condominium units. Thus,
there is no gainsaying that the residents of West Tower are real parties-in-
interest.
There can also be no denying that West Tower Corp. represents the common
interest of its unit owners and residents, and has the legal standing to file and
pursue the instant petition. While a condominium corporation has limited
powers under RA 4726, otherwise known as The Condominium Act, it is
empowered to pursue actions in behalf of its members. In the instant case, the
condominium corporation is the management body of West Tower and deals
with everything that may affect some or all of the condominium unit owners or
users.
Organizations that indicated their intention to join the petition and submitted
proof of juridical personality
Anent the propriety of including the Catholic Bishops’ Conference of the
Philippines, Kilusang Makabansang Ekonomiya, Inc., Women’s Business Council
of the Philippines, Inc., Junior Chambers International Philippines, Inc. – San Juan
Chapter, Zonta Club of Makati Ayala Foundations, and the Consolidated Mansions
Condominium Corporation, as petitioners in the case, the Court already granted
their intervention in the present controversy in the adverted July 30, 2013
Resolution.
This is so considering that the filing of a petition for the issuance of a writ of
kalikasan under Sec. 1, Rule 7[45] of the Rules of Procedure for Environmental
Cases does not require that a petitioner be directly affected by an
environmental... disaster. The rule clearly allows juridical persons to file the
petition on behalf of persons whose constitutional right to a balanced and
healthful ecology is violated, or threatened with violation.
Thus, as parties to the case, they are entitled to be furnished copies of all the
submissions to the Court, including the periodic reports of FPIC and the results
of the evaluations and tests conducted on the WOPL.
Having disposed of the procedural issue, We proceed to the bone of contention in
the pending motions. Suffice it to state in the outset that as regards the
substantive issues presented, the Court, likewise, concurs with the other
recommendations of the CA, with a few... modifications.
II.
Propriety of Converting the TEPO to PEPO or its Lifting in light of the DOE
Certification of the WOPL’s Commercial Viability
To recall, petitioners’ persistent plea is for the conversion of the November 19,
2010 TEPO into a Permanent Environmental Protection Order (PEPO) pursuant
to Sec. 3,[46] Rule 5 of the Rules of Procedure for Environmental Cases. For its
part, respondent
FPIC asserts that regular testing, as well as the measures that are already in place,
will sufficiently address any concern of oil leaks from the WOPL.
With respect to leak detection, FPIC claims that it has in place the following
systems: (a) regular cleaning scraper runs, which are done quarterly; (b) pipeline
integrity gauge (PIG) tests/Intelligent PIG, now known as in-line inspections
(ILI), which is done every five years; (c) pressure monitoring valves; and (d) 24-
hour patrols. Additionally, FPIC asserted that it also undertook the following: (a)
monitoring of wells and borehole testing/vapor tests; (b) leak tightness test, also
known as segment pressure test; (c) pressure-controlled test; (d)... inspection
and reinforcement of patches; (e) inspection and reinforcement of dents; and (f)
Pandacan segment replacement. Furthermore, in August 2010, with the oil leak
hogging the headlines, FPIC hired NDT Middle East FZE (NDT) to conduct ILI...
inspections through magnetic flux leakage (MFL) and ultrasonic tests to,
respectively, detect wall thinning of the pipeline and check it for cracks.
The CA, however, observed that all of these tests and measures are inconclusive
and insufficient for purposes of leak detection and pipeline integrity
maintenance. Hence, considering the necessary caution and level of assurance
required to ensure that the WOPL system is free... from leaks and is safe for
commercial operation, the CA recommended that FPIC obtain from the DOE a
certification that the WOPL is already safe for commercial operation. This
certification, according to the CA, was to be issued with due consideration of the
adoption by FPIC of... the appropriate leak detection systems to monitor
sufficiently the entire WOPL and the need to replace portions of the pipes with
existing patches and sleeves. Sans the required certification, use of the WOPL
shall remain abated.
The Court found this recommendation of the appellate court proper. Hence, We
required FPIC to obtain the adverted DOE Certification in Our July 30, 2013
Resolution. We deemed it proper to require said certification from the DOE
considering that the core issue of this case... requires the specialized knowledge
and special expertise of the DOE and various other administrative agencies. On
October 25, 2013, the DOE submitted the certification pursuant to the July 30,
2013 Resolution of the Court. Later, however, on August 5, 2014, DOE Secretary
Carlos
Jericho I. Petilla submitted a letter recommending certain activities and the
timetable for the resumption of the WOPL operations after conducting a dialogue
between the concerned government agencies and FPIC. After a perusal of the
recommendations of the DOE and the submissions of the parties, the Court adopts
the activities and measures prescribed in the DOE letter dated August 5, 2014 to
be complied with by FPIC as conditions for the resumption of the commercial
operations of... the WOPL. The DOE should, therefore, proceed with the
implementation of the tests proposed in the said August 5, 2014 letter.
Thereafter, if it is satisfied that the results warrant the immediate reopening of
the WOPL, the DOE shall issue an order allowing FPIC to resume the... operation
of the WOPL. On the other hand, should the probe result in a finding that the
pipeline is no longer safe for continued use and that its condition is irremediable,
or that it already exceeded its serviceable life, among others, the closure of the
WOPL may be ordered.
It must be stressed that what is in issue in the instant petition is the WOPL’s
compliance with pipeline structure standards so as to make it fit for its purpose,
a question of fact that is to be determined on the basis of the evidence presented
by the parties on the WOPL’s... actual state. Hence, Our consideration of the
numerous findings and recommendations of the CA, the DOE, and the amici curiae
on the WOPL’s present structure, and not the cited pipeline incidents as the
dissent propounds.
Consider also the fact that it is the DOE itself that imposed several conditions
upon FPIC for the resumption of the operations of the WOPL. This, coupled with
the submission by the DOE of its proposed activities and timetable, is a clear and
unequivocal message coming from the
DOE that the WOPL’s soundness for resumption of and continued commercial
operations is not yet fully determined. And it is only after an extensive
determination by the DOE of the pipeline’s actual physical state through its
proposed activities, and not merely through a... short-form integrity audit,[56]
that the factual issue on the WOPL’s viability can be settled. The issue, therefore,
on the pipeline’s structural integrity has not yet been rendered moot and remains
to be subject to this Court’s resolution.
Consequently, We cannot say that the DOE’s issuance of the certification adverted
to equates to the writ of kalikasan being functus officio at this point.
Propriety of the Creation of a Special Trust Fund
Anent petitioners’ prayer for the creation of a special trust fund, We note that
under Sec. 1, Rule 5 of the Rules of Procedure for Environmental Cases, a trust
fund is limited solely for the purpose of rehabilitating or restoring the
environment.
A reading of the petition and the motion for partial reconsideration readily
reveals that the prayer is for the creation of a trust fund for similar future
contingencies.This is clearly outside the limited purpose of a special trust fund
under the Rules of Procedure for Environmental Cases, which is to rehabilitate or
restore the environment that has presumably already suffered. Hence,the Court
affirms with concurrence the observation of the appellate court that the prayer
is but a claim for damages, which is prohibited by the Rules of Procedure for
Environmental Cases. As such, the Court is of the considered view that the
creation of a special trust fund is misplaced.
The present ruling on petitioners’ prayer for the creation of a special trust fund
in the instant recourse, however, is without prejudice to the judgment/s that may
be rendered in the civil and/or criminal cases filed by petitioners arising from the
same incident if the payment... of damages is found warranted.
IV.
Liability of FPIC, FGC and their respective Directors and Officers
On the last issue of the liability of FPIC, FGC and their respective directors and
officers, the CA found FGC not liable under the TEPO and, without prejudice to
the outcome of the civil case (Civil Case No. 11-256, RTC, Branch 58 in Makati
City) and criminal complaint (Complaint-Affidavit for Reckless Imprudence,
Office of the Provincial Prosecutor of Makati City) filed against them, the
individual directors and officers of FPIC and FGC are not liable in their individual
capacities.
The Court will refrain from ruling on the finding of the CA that the
individual directors and officers of FPIC and FGC are not liable due to the
explicit rule in the Rules of Procedure for Environmental cases that in a
petition for a writ of kalikasan,the Court cannot grant the award of damages
to individual petitioners under Rule 7, Sec. 15(e) of the Rules of Procedure
for Environmental Cases. As duly noted by the CA, the civil case and criminal
complaint filed by petitioners against respondents are the proper proceedings to
ventilate and determine the individual liability of respondents, if any, on their
exercise of corporate powers and the management of FPIC relative to the dire
environmental impact of the dumping of petroleum products stemming from the
leak in the WOPL in Barangay Bangkal, Makati City.
Hence, the Court will not rule on the alleged liability on the part of the FPIC and
FGC officials which can, however, be properly resolved in the civil and criminal
cases now pending against them.
Q. No civil liability in drug-related cases, Reason
People vs. Morales
PEOPLE OF THE PHILIPPINES vs. ALFREDO MORALES Y LAM,
G.R. No. 206832, January 21, 2015, PEREZ, J.
FACTS:
In the Criminal Case No. 7534, Morales was charged with illegal sale of shabu.In
the Criminal Case No. 7535, Morales was charged with illegal possession of shabu.
When arraigned, the accused pleaded not guilty of the crimes charged.
The RTC held that the prosecution successfully discharged the burden of proof in
the cases of illegal sale and illegal possession of dangerous drugs. The trial court
relied on the categorical statements of the prosecution witnesses as against the
bare denials of the accused. The presumption or regularity of performance of
duties was upheld in the absence of any improper motive on their part to testify
falsely against the accused.
Upon appeal, the appellate court affirmed the findings of the trial court. It upheld
the presence of all the elements of the offenses of illegal sale and illegal
possession of drugs, and preservation of the corpus delicti of the crime from the
time they were seized and presented in court. The procedural steps required by
Section 21 of Republic Act No. 9165 were liberally construed in favor of the
prosecution in view of the preservation of integrity and identity of the corpus
delicti. Conformably, the finding on the presumption of regularity of performance
of duties was affirmed in the absence of ill-motive on the part of the police
officers.
On 29 August 2012, a Notice of Appeal was filed by Morales through counsel
before the Supreme Court.
While this case is pending appeal, the Inmate Documents and Processing
Division Officer-in-Charge Emerenciana M. Divina informed the Court that
accused-appellant Morales died while committed at the Bureau of
Corrections on 2 November 2013 as evidenced by a copy of Death Report signed
by New Bilibid Prison Hospital's Medical Officer Ursicio D. Cenas.
ISSUE: Whether the death of accused-appellant Morales pending appeal of his
conviction extinguishes his civil and criminal liabilities.
RULING:
YES. The death of accused-appellant Morales pending appeal of his
conviction extinguishes his civil and criminal liabilities
Under Article 89(1) of the Revised Penal Code:
Criminal liability is totally extinguished:
1. By the death of the convict, as to the personal penalties; and as to
pecuniary penalties, liability therefor is extinguished only when the
death of the offender occurs before final judgment. x x x x
Ordinarily, both the civil and criminal liabilities are extinguished upon the death
of the accused pending appeal of his conviction by the lower courts.
However, a violation of Republic Act No. 9165 does not entail any civil
liability. No civil liability needs extinguishment.
Dispositive Portion
WHEREFORE, in view of his death on 2 November 2013, the appeal of accused-
appellant Alfredo Morales y Lam from the Decision of the Court of Appeals dated
14 August 2012 in CA-G.R. CR-H.C. No. 04287 affirming the Decision of the
Regional Trial Court of San Mateo, Rizal, Branch 76 in Criminal Case Nos. 7534-
7535 convicting him of violation of Sections 5 and 11, Article II of Republic Act
No. 9165 is hereby declared MOOT and ACADEMIC.
SO ORDERED.
R. Consequential Damages
REPUBLIC OF THE PHILIPPINES, REPRESENTED BY THE NATIONAL
IRRIGATION ADMINISTRATION, Petitioner, v. ROLANDO C. CEBUAN,
RUBEN C. CEBUAN, ERIC C. CEBUAN, SAMUEL C. BARING, BEATRICE A. LOW,
LEONORE L. DE LA SERNA AND HEIRS OF LORENZO UMBAAD
G.R. No. 206702, June 07, 2017, TIJAM, J.:
FACTS:
For its Lower Agusan Development Project – Irrigation Component at Barangays
Basag, Ampayon and Kinamlutan, all situated in Butuan City, the National
Irrigation Administration (NIA) identified several parcels of land as suitable
locations for the construction of irrigation canals. Portions of the parcels of land
identified were those located in (1) Barangay Basag owned by respondents
Rolando Cebuan (652 sq.m.); Ruben Cebuan (503 sq. m.); Eric Cebuan (1,244 sq.
m. and 1,754 sq. m.); and Samuel Baring (776 sq. m. and 836 sq. m.); (2) Barangay
Ampayon owned by respondent Beatrice Low (2,412 sq. m. and 1,550 sq. m.);
and, (3) Barangay Kinamlutan owned by respondents Leonore Dela Serna (1,440
sq. m.) and the Heirs of Lorenzo Umbaad (590 sq. m.)
NIA initiated expropriation proceedings after the failure of the negotiated sale. 6
In its Complaint7, NIA based the values of the properties on BIR Zonal Valuations
as specified in Department Order No. 16-20008 and arrived at an aggregate
amount of PhP60,094.50 for the entire 11,737 sq. m. sought to be expropriated.
In their Answer9, respondents Cebuans, Baring and the heirs of Umbaad
expressed their agreement to the expropriation provided that the properties be
valued at least PhP300 per square meter. Likewise, respondents Dela Serna and
Low agreed to the expropriation but valued at PhP300 per square meter.
Thereafter, NIA moved for the issuance of a writ of possession and upon deposit
of the amount equivalent to 100% of the value of the properties involved based
on the current BIR zonal value and submission of the certificate of availability of
funds, the RTC granted the same and a Writ of Possession13 dated April 21, 2004
was issued.
Subsequently, as proposed by NIA, and as agreed upon by the parties, a Board of
Commissioners15 was created by the RTC to determine the fair market value of
the properties sought to be expropriated.
On May 16, 2006, the Commissioners submitted their Report assigning the fair
market value of the properties of the Cebuans, Baring and the heirs of Umbaad at
PhP45 per square meter and the property of Leonore dela Serna at PhP120 per
square meter, while the consequential damages were assessed at 5% of the fair
market value of the remaining portion of the properties and the consequential
benefits were assessed at 3% thereof.
RTC rendered its Partial Judgment adopting the Commissioners' Report and
disregarding NIA's contention that the price should be at PhP0.90 per square
meter for being unrealistic.
Upon Motion for Clarificatory Judgment filed by the heirs of Umbaad, the RTC
rendered its Clarificatory and Final Judgment22 additionally directing the NIA to
pay Leonore dela Cerna, the heirs of Umbaad and Beatrice Low just compensation
and unrealized income as follows: The National Irrigation Administration (NIA)
is directed to pay: I.) For lands affected: Just Compensation (JC=FMV+CD-CB;
where FMV means Fair Market Value, CD means Consequential Damages, and CB
means Consequential Benefits.)
From the foregoing pronouncements NIA interposed its appeal24 to the CA on
the grounds that: (1) the market values assigned to the properties were contrary
to the established zonal valuations; (b) the determination of consequential
damages and benefits are speculative; and, (c) the award for unrealized income
lacked basis. NIA argued that the RTC should have instead used the tax
declarations and BIR zonal valuations to determine the fair market value of the
subject properties. NIA further argued that the consequential benefits should, at
best, be equal to the consequential damages, resulting in the two canceling each
other, considering the tremendous increase in the value of the remaining areas
of respondents' properties caused by the construction of the canals.
The CA partially granted NIA's appeal. The CA held that the assessed values
recommended by the Commissioners were not exorbitant based as it were on (1)
varied appraisals from different appraisers; (2) description and identification of
the properties based on ocular inspection; (3) location and/or distance of the
properties from the national road; (4) variety of crops planted thereon; and (5)
similarly situated adjacent lands.
However, the CA found the award for unrealized income improper considering
that the determination of just compensation is as of the time of taking. Finally, the
CA observed that some of the respondents were not paid for the improvements
on their properties. As such, the CA remanded the case to the RTC for the
reception of additional evidence pertaining thereto and thereafter, to compute
payment thereof.
ISSUE:
Whether the CA erred in affirming the RTC's ruling on just compensation
RULING:
No error in the Assessment of Value of Land
In expropriation proceedings, just compensation is defined as the full and fair
equivalent of the property taken from its owner by the expropriator. The
measure is not the taker's gain, but the owner's loss. The word "just" is used to
intensify the meaning of the word compensation and to convey thereby the idea
that the equivalent to be rendered for the property to be taken shall be real,
substantial, full and ample.
The constitutional limitation of just compensation is considered to be a sum
equivalent to the market value of the property, broadly defined as the price fixed
by the seller in open market in the usual and ordinary course of legal action and
competition; or the fair value of the property; as between one who receives and
one who desires to sell it, fixed at the time of the actual taking by the government.
Unmoving still is the rule that the "just"-ness of the compensation can only be
attained by using reliable and actual data. Accordingly, trial courts are reminded,
time and again, to be circumspect in its evaluation of just compensation due the
property owner, considering that eminent domain cases involve the expenditure
of public funds.
Here, in valuing the land for purposes of fixing just compensation, the RTC took
into consideration the Commissioners' Report. The Commissioners, in turn,
utilized the Market Data Approach wherein the sales, listings or appraisals–
adjusted as to the time of sale, location and general characteristics of comparable
lots in the area, where the subject properties were located– were used.
Information was gathered from the appraisals of existing banking institutions, as
well as on site inspections. The fair market value of the properties were, thus,
determined based on reliable and actual data. As such, the Court sees no error
when the trial court accepted the Commissioner's Report and rendered judgment
in accordance therewith as the same is sanctioned under Section 8, Rule 67.
Award for Consequential Damages Proper
While as a general rule, just compensation, to which the owner of the property to
be expropriated is entitled, is equivalent to the market value, the rule is modified
where only a part of a certain property is expropriated. In such a case, the owner
is not restricted to compensation for the portion actually taken, he is also entitled
to recover the consequential damage, if any, to the remaining part of the property.
The award of consequential damages is specifically enunciated under Section 6
of Rule 67 as follows:
Section 6. Proceedings by commissioners. — Before entering upon the
performance of their duties, the commissioners shall take and subscribe
an oath that they will faithfully perform their duties as commissioners,
which oath shall be filed in court with the other proceedings in the case.
Evidence may be introduced by either party before the commissioners
who are authorized to administer oaths on hearings before them, and the
commissioners shall, unless the parties consent to the contrary, after due
notice to the parties, to attend, view and examine the property sought to
be expropriated and its surroundings, and may measure the same, after
which either party may, by himself or counsel, argue the case. The
commissioners shall assess the consequential damages to the
property not taken and deduct from such consequential damages
the consequential benefits to be derived by the owner from the
public use or purpose of the property taken, the operation of its
franchise by the corporation or the carrying on of the business of
the corporation or person taking the property. But in no case shall
the consequential benefits assessed exceed the consequential
 damages assessed, or the owner be deprived of the actual value of SO ORDERED.
his property so taken.
-Mika Ituriaga
Accordingly, if as a result of expropriation, the remaining portion of the property
suffers from impairment or decrease in value, the award of consequential
damages is proper. On the other hand, if the expropriation resulted in benefits to
the remaining lot, such consequential benefits may be deducted from the
consequential damages or from the value of the expropriated property. However,
such consequential benefits refer to the actual benefits derived by the landowner
which are the direct and proximate results of the improvements as a consequence
of the expropriation and not to the general benefits which the landowner may
receive in common with the community.

In arriving at 5% of the fair market value as consequential damages, the

Commissioners took into consideration the diminution of the area of the subject
properties which resulted in a decrease in the quantity of the harvest, while the
3% consequential benefits was arrived at by considering the benefits brought by
the irrigation canals, greater accessibility to the roads and the appreciation in the
market value of the lots. We find no reason to depart from the assessment of the
Commissioners, as affirmed and adopted by the expropriation court.

IN VIEW OF THE FOREGOING, the Court RESOLVES to PARTLY GRANT the

Petition such that:

The assailed Decision dated July 13, 2012 and Resolution dated February 6, 201
3 of the Court of Appeals finding petitioner Republic of the Philippines,
represented by the National Irrigation Authority, liable to pay just compensation
in the amount computed by the Regional Trial Court sans the award for
unrealized income are AFFIRMED.

However, in conformity with the existing laws, rules, and jurisprudence, the
amount of legal interest is MODIFIED such that the interest rate of twelve
percent (12%) p.a. on the balance due from May 7, 2003 until June 30, 2013 and
the interest rate of six percent (6%) p.a. from July 1, 2013 until fully paid are
imposed.

The order remanding the instant case to the Regional Trial Court for
determination of alleged unpaid improvements on the affected properties is
DELETED.