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Industrial Insurance Company, Inc. V. Pablo Bondad and Ligorio Bondad (2000) Panganiban, J. There was a mishap involving 3 vehicles: a Galant Sigma car (driven by Morales), a packed passenger jeep (driven by Bondad), and a DM Transit Bus (driven by Mendoza). Accdg to the police investigation: o The bus was along South Expressway going towards Makati. o When upon reaching a certain point, the bus bumped the rear left side of the jeep. The jeep was then at a stop position due to a flat tire. o The jeep then swerved to the left and collided with the right side of the car. The car was then travelling in the same direction of the bus, taking the innermost lane. o The car was dragged to its left side and hit the concrete wall. o All vehicles incurred damages and injuries to the passengers of the jeep and the bus. o Victims were brought to the hospital. In the RTC, the insurance company (Industrial Insurance) and the driver of the car filed a complaint for damages against the bus company and the owner and driver of the jeep. The insurance company said that it paid the car driver an amount (P29k) for the damages to the car and that the mishap was caused proximately by the wanton negligence of the bus and jeep drivers. Jeep answered: their vehicle was on stop because of a flat tire. It was the bus which hit the car. o Jeep drivers/owner counterclaimed: Insurance company acted in bad faith in impleading them RTC sided with the jeep drivers/owner and ordered the insurance company to pay moral damages. CA affirmed but reduced the moral damages.

Issue: Is the award of moral damages to the jeep drivers/owner proper? Held: Yes. Ratio: When Moral Damages are recoverable: Malicious prosecution 1. Bad fatih The jeep owner/driver was recklessly impleaded without basis by the insurance company despite the clear in the police report. The records show that the suit against the jeep was unjustified. o The contact between the jeep and car was completely due to the impact of the bus. o This is manifest in the police investigation report and in the findings of facts of both lower courts o The jeep was on the shoulder of the road because of a flat tire. o By the emergency situation, they could not have done anything to avoid getting hit by the bus. The carelessness and lack of diligence of petitioner destroy its claim of good faith. Also, the insurance company knew that the jeep was not the cause of the accident. o Seen from its failure to even make a prior formal demand on the jeep before initiating the suit. Moral Damages To sustain an award for moral damages, it must be shown that: 1. The claimant suffered injury, and 2. Such injury sprung from any of the cases listed in NCC 2219 and 2220 It is not enough that the claimant alleges mental anguish, serious anxiety, wounded feelings, social humiliation, and the like as a result of the acts of the other party. It is necessary that such acts be shown to have been tainted with bad faith or ill motive. In this case, it has been shown that the insurance company acted in bad faith in compelling the jeep owner/driver to litigate an unfounded claim. o As a result, jeepney driver Ligorio Bondad could no longer concentrate on his job." Moreover, jeepney owner Pablo Bondad became sick and even suffered a mild stroke. o The anxiety is not difficult to understand. o They were innocently attending to a flat tire on the shoulder of the road; the next thing they knew, they were already being blamed for an accident. o Worse, they were forced to commute all the way from Laguna to Makati in order to attend the hearings. Under the circumstances of this case, the award of moral damages is justified. Also, the jeep driver/owner pray that the amount of actual, moral and exemplary damages awarded by the TC be reinstated. o SC says it cannot because they did not appeal the CA Decision. They are deemed to be satisfied with it and cannot be allowed to attack it belatedly in their Memorandum.

2.

Petition denied. (Insurance company lost, award of moral damages proper)