[G.R. No. 139297.

February 23, 2004]

PEOPLE OF THE PHILIPPINES, appellee, vs. RENATO @ BONG
TORRECAMPO y LEYTE and RENE TORRECAMPO y
LEYTE, appellants.

returned to her house. From there, she saw Erlinda emotionally

telling people that crowded the crime scene about finding her
tenant Jovito dead with his head cut off. Eventually, the authorities
arrived and investigated the incident.
Melvin Tupaz identified the body of his cousin Jovito. Ravell Ronald
R. Baluyut, a medico-legal expert of the National Bureau of
Investigation, conducted the autopsy and disclosed the cause of
[4]
death as multiple stab and hack (sic) wounds.

DECISION
PUNO, J.:
[1]

JOVITO CASPILLO was found stabbed and decapitated in his rented

room. For his death, brothers RENATO alias Bong and RENE
TORRECAMPO Y LEYTE were charged before the Regional Trial Court
[2]
[3]
of Las Pias with murder in an Information alleging:
th

That on or about the 11 day of November 1994, in the Municipality

of Las Pias, Metro Manila, Philippines, and within the jurisdiction of
this Honorable Court, the above-named accused, conspiring and
confederating with one, NORA TORRECAMPO Y LEYTE whose
present whereabouts still unknown and all of them mutually helping
and aiding one another, with intent to kill, taking advantage of
superior strength and/or with evident premeditation did, then and
there willfully, unlawfully and feloniously attack, assault, stab in the
different part(s) of his body and even cut off his head with a bladed
weapon, one JOVITO GASPILLO, thereby inflicting upon him serious
and mortal wounds, which directly caused the death of said JOVITO
GASPILLO.
The evidence adduced in the trial shows that Jovito was a tenant of
the Escosio family at No. 66 Laong Street, Barangay Almanza Uno,
Las Pias, Metro Manila. He shared a room with his brother Randy
and first cousins Nora and Karen Torrecampo. The Escosios
occupied the other room of the house.
Prosecution witness Erlinda Escosio testified that on November 11,
1994 at about 10:30 in the morning, she was seated at the door of
their room removing lice from the hair of her daughter when she
saw Nora and appellant Renato pass by. They were followed shortly
after by another man later identified as appellant Rene
Torrecampo. All three (3) went to the room of Jovito. A while later,
Erlinda heard a weepy Nora pleading to get into Jovitos room where
the loud noise of the radio could be heard. Some minutes after, she
saw Nora and appellant Renato come out of the room. Appellant
Renato dragged Nora to the direction of Sampaguita
Compound. Appellant Rene left the room after them. He was
carrying a bag.
Erlinda continued that after the departure of appellants and Nora,
she walked to the toilet and noticed blood at the door of
Jovito. Curious, she peeped inside and was shocked by the sight of a
body drenched in blood with its head severed from the neck. It was
Jovito. Terrified, she called for her neighbors and the barangay
tanods. People milled to the crime scene until the authorities
arrived. She felt that appellants were the culprits. She explained
that the main door is the only way in and out of the house. Either
way, one would have to pass by their room to get to Jovitos. On
subject date and time, she only saw appellants and Nora go in and
come out of the scene of the crime. At the police station, she
identified both appellants.
Cherry Francisco, a neighbor who lives in front of the house of the
Escosios and approximately ten (10) meters from the room of Jovito,
also gave her testimony. According to her, at about 10:00 A.M. on
November 11, 1994, she was eating breakfast with her family when
she heard noises coming from the room of Jovito. She went out to
investigate and noticed Nora beating at the door crying out, Bakit
ninyo siya pinatay? The door was suddenly opened and someone
grabbed Nora by the hair and pulled her inside the room. She later
identified the person as appellant Rene. Moments thereafter,
appellant Renato came out of the room dragging Nora with
him. Trailing them was appellant Rene, whose hands and clothes
were drenched with blood. However, as appellant Renato and Nora
walked to the direction of Sampaguita Compound, appellant Rene
went off to Laong Almanza carrying a long bag. Without delay,
Cherry rushed to the house of neighbor Buena to recount what she
had just witnessed. Buena called for the authorities. Cherry

Randy Caspillo, the younger brother of Jovito, testified on the

expenses incurred by the family as a result of his brothers
death. He claimed a total of P35,014.00 in expenses but was only
able to account for P13,250.00 in receipts. As a result of the sudden
demise of his brother, he said he suffered moral shock, mental
anguish and wounded feelings.
Appellant Rene Torrecampo testified in his defense. He averred that
on November 11, 1994 at 7:00 A.M., he left for work and arrived at
LFS Engineering an hour later as indicated in the office logbook. He
claimed that he found out about Jovitos death only at 10:00 A.M.
during his coffee break when his brothers (appellant Renato) wife
telephoned them about it. According to him, they left for Laong
immediately after getting permission from their employer Lamberto
Samonte. They arrived there at 11:00 that same morning after
taking a tricycle to Casimiro, then a passenger jeep to Pillar
Village. Right away, he looked for his sister Karen, who was then
living with Jovito. He found her unconscious at her friend Lolita
Montinels place so he brought her to Paraaque Community
Hospital on board a white police service Fiera. When Karen regained
consciousness and asked about the incident, she merely cried. The
doctor advised the police that she was just scared and needed some
rest. On their way home, appellant Rene and Karen stopped by the
latters place primarily to find out what happened to Jovito and
incidentally to get some of her things. The room was a mess and
Jovito was nowhere to be found. While there they overheard Roger
Escosio saying, Ang tigas-tigas ng ulo nila, matagal ko nang
pinapaalis ayaw nilang umalis.
Appellant Rene added that at work the next day he read
in Abante that his brother Renato was being tagged as the principal
suspect in the killing. Hence, he and his brother immediately
requested their employer Lamberto Samonte to accompany them to
the Las Pias Police Station to surrender. The police took them to
the Office of then Municipal Mayor Ben Casimiro where they were
presented to the media. An investigation ensued. Appellants were
detained and ultimately charged for the murder of Jovito.
Appellant Renato Torrecampo basically related a similar story. His
account only differed on what he did upon arrival at Laong on the
date of the incident. He claimed that he went straight home to take
care of his sick child and stayed there with his wife the rest of the
day. He was about to leave for work the next morning when he read
in the newspaper that he was the prime suspect in the killing of
Jovito. Together with his brother, he asked their employer to escort
him to the police station to clear his name. However, they were
detained instead and threatened into admitting the commission of
the crime. They insisted that they had no knowledge thereof and
explained that they were at their place of work when it
happened. The police did not believe them. Forthwith, they were
charged with murder.
The defense likewise offered in evidence the testimonies of SPO1
Benjamin Javier, Edgardo Gremio and SPO4 Esmeraldo
Lucena. SPO1 Javier of the Las Pias Police Criminal Investigation
Division was assigned to investigate the death of Jovito. He said that
he found the dead body of Jovito in his small rented room, which
was adjacent to the room of the owner of the two (2)-bedroom
house. The rooms were separated by a plywood wall. He said that
Jovitos room was facing the house of one Cherry Francisco. He
placed the time of death at 10:30 A.M. based on his interview of
Erlinda Escosio. He took down the statement of Erlinda on
November 12, 1994. He believed her story and submitted a report
on his findings.

Edgardo Gremio and SPO4 Esmeraldo Lucena gave corroborative

testimonies. Gremio testified that he is a member of the Barangay
Police Force in Laong Street, Barangay Almanza Uno, Las Pias. He
claimed that at about 10:30 A.M. on November 11, 1994, he was
informed of a killing in his area. He passed for his neighbor SPO4
Lucena, then still asleep, before going to the crime scene. SPO4
Lucena said that people crowded the place of the incident when
they got there. He went inside the house, which he insisted had
three (3) rooms. He maintained that the first room was occupied by
the owner of the house, the second by a driver he did not know and
the third by the victim Jovito. He saw the dead body and told
everyone not to touch anything until the police investigator
arrived. He then called for fellow policemen whom he accompanied
to the scene.

On the basis of circumstantial evidence, the court a quo found

Renato and Rene Torrecampo guilty beyond reasonable doubt of
murder and sentenced them to death. It likewise ordered them to
solidarily pay the heirs of the victim Jovito Caspillo P100,000.00 as
indemnity for the loss of life; P35,014.00 in actual damages for the
wake, funeral and burial expenses; and, the costs of the
[5]
suit. Hence, this automatic review pursuant to Article 47 of the
[6]
Revised Penal Code, as amended by Republic Act No. 7659.

Clearly, reference is made on what Erlinda did not mention in her

sworn statement. This is not an inconsistency but merely an
incompleteness of narration. Sworn statements, being taken ex
parte, are almost always incomplete and often inaccurate for
various reasons, sometimes from partial suggestion or for want of
[11]
suggestion and inquiries. There is no rule of evidence to the effect
that omission of certain particulars in a sworn statement would
estop an affiant from making an elaboration thereof or from
[12]
correcting inaccuracies during the trial.

In convicting appellants, the trial court relied on the following

circumstances: (a) at about 9:00 A.M. on November 11, 1994,
Erlinda saw Jovito very much alive; (b) after an hour, Erlinda saw
appellant Renato and his sister Nora pass by, followed shortly by
appellant Rene; (c) Erlinda heard a commotion inside the room of
Jovito and after a few minutes saw appellants emerging from the
room with Nora in tow; (d) Cherry heard a loud banging from the
room of Jovito so she went outside and saw Nora frantically
pounding at the door, then Nora was pulled inside the room; (e)
after thirty (30) minutes, Cherry witnessed a seemingly weak Nora
being assisted by appellant Renato coming out of the room; and, (f)
Cherry likewise observed appellant Rene leaving the room with his
hands and clothes covered with blood.
Circumstantial evidence to be sufficient for purposes of conviction
must have the following elements: (a) there is more than one
circumstance; (b) the facts from which the inferences are derived
are proved; and, (c) the combination of all circumstances is such as
[7]
to produce a conviction beyond reasonable doubt. The
circumstances proved should constitute an unbroken chain, which
leads to one fair and reasonable conclusion pointing to the accused,
to the exclusion of all others, as the guilty person.
In the instant case, the circumstances enumerated by the trial court
establish an unbroken chain of events showing the complicity of
appellants and no other in the killing of victim Jovito
Caspillo. Indeed, the case of the prosecution is woven principally
around the testimonies of witnesses Erlinda Escosio and Cherry
Francisco whose testimonies were sufficiently tested and found
credible on the crucible of cross-examination. Notably, as correctly
observed by the court a quo, appellants failed to demonstrate ill
motive on the part of the prosecution witnesses to testify against
them. Absent any evidence showing any reason or motive for the
witnesses to prevaricate, the logical conclusion is that no such
improper motive exists, and their testimonies are worthy of full faith
[8]
and credit.
In their Brief, appellants contend that the decision of the trial court
is not supported and contrary to the evidence adduced during
[9]
trial. We reject this contention.
First. Appellants submit that the trial court should have completely
rejected both oral and written accounts of prosecution witness
Erlinda Escosio considering that her in-court testimony is contrary to
her sworn statement. Specifically, they call attention to Erlindas
narration in court that she saw appellant Rene stabbing the victim
while appellant Renato was slicing off his head. We are not
impressed. The records show that on cross-examination, Erlinda
[10]
was able to explain the alleged inconsistency:
Q :
Do you affirm the truth and veracity of the statement you
have issued before SPO1 Benjamin Javier as stated in your salaysay?

Yes, Sir.

Q :
You stated previously that you saw the actual incident
while peeping through the hole in the wall, did you not?
A

Yes, Sir.

Q :
How come in your statement you never mentioned that
you peeped through the hole? You stayed outside while taking out
the lice from the head of your daughter?
A :
details.

I was scared and confused that I failed to narrate the

The trial court did not err in giving credence to Erlindas testimony in
court as it is consistent with her sworn statement on all other
matters and is corroborated on material points by the testimony of
Cherry Francisco. Repeatedly, this Court has ruled that the
testimony of a witness may be believed in part and disbelieved in
other parts, depending on the corroborative evidence and the
[13]
probabilities and improbabilities of the case. Moreover, 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
declarants demeanor, conduct and attitude at the trial and is
thereby placed in a more competent position to discriminate
[14]
between truth and falsehood.
Second. Appellants assail the testimonies of Erlinda and Cherry on
the commission of the crime at 10:00 A.M. on November 11,
1994. They insist that they had just left their place of work and only
arrived at the crime scene an hour later.
We are not convinced. To merit belief, alibi and denial must be
buttressed by strong evidence of non-culpability. The records reveal
that appellants employer only substantiated their claim that they
left LFS Engineering at 10:00 A.M. on that ill-fated day. No clear and
convincing evidence was adduced to establish that it was physically
impossible for them to be at the scene of the crime when it was
committed. Indeed, they admitted leaving LFS Engineering to go to
the locus criminis though they claimed to have arrived there only at
11:00 A.M. Their testimony cannot prevail over the positive
identification of Erlinda and Cherry, who are disinterested witnesses.
Also dubious is their asseveration on what they did upon arrival at
the crime scene. Appellant Rene professed that he looked for his
sister Karen whereas appellant Renato averred that he went home
to attend to a sick child. They obviously deviated from their purpose
[15]
to find out what really happened to their cousin Jovito. We note
that they did not present anyone to corroborate their stories.
Third. Appellants likewise impugn the testimony of prosecution
witness Cherry Francisco. They claim that SPO1 Benjamin Javier
merely supplied the name of appellant Rene Torrecampo as the
person who pulled Nora into Jovitos room during the incident in
view of the admission of Cherry during trial that she did not know
appellant Rene.
As correctly observed by the Solicitor General, this attempt to
discredit the testimony of Cherry is misleading. Admittedly, she
testified that she only saw appellant Rene for the first time on
November 11, 1994. But she was certain that it was appellant Rene
who pulled Nora inside Jovitos room when she was made to identify
[16]
him in court on March 23, 1995.

Appellants likewise try to discredit the testimony of Cherry that she

heard the commotion in the room of Jovito given the blaring sound
of the radio, and that she witnessed the circumstances of the crime
at a distance of ten (10) meters. The contention is misleading. The
records show that Cherry heard some disturbance from the room of
Jovito, which made her go out of her house. She never claimed that
it was the blare of the radio that caused her to investigate
[17]
outside. It was Erlinda who testified about the sound of the radio.
As to the distance of her house from the room of Jovito, the Court
finds reliable the testimony of Cherry on cross-examination that her
house was directly in line with the room of Jovito and that there was
nothing to obstruct her view thereof except the not so tall
[18]
trees. It is settled that when conditions of visibility are favorable,
and when the witnesses do not appear to be biased, their assertion
[19]
as to the identity of the malefactor should normally be accepted.
Appellants further denigrate Cherrys assertion that one of them left
the crime scene with blood spattered all over his clothes and
body. They aver that whoever committed the killing could have
washed away the bloodstains before leaving the victims room as
suggested by the pail of blood-tainted water found in Jovitos room.
It may be in keeping with human experience for anyone including
appellants to wash the blood away from their clothes and body after
committing a crime. However, it is also natural for them to act with
haste so they could immediately leave the crime scene and avoid
suspicion. It is thus not incredible that the hurried and haphazard
attempt to remove the bloodstains left the herein appellants with
some traces of blood still visible to the naked eyes of witnesses
Erlinda and Cherry.
Fourth. In a further effort to impair the testimonies of the
prosecution witnesses, appellants impute on SPO1 Benjamin Javier
the orchestration of the written statements and oral testimonies
of Erlinda and Cherry to get recognition for arresting appellants and
solving the crime. This is mere conjecture that deserves scant
consideration. Needless to state, the court in criminal prosecution is
always guided by evidence that is tangible, verifiable and in harmony
with the usual course of human experience and not by mere
[20]
surmises.
Fifth. Appellants also assail the denial by the trial court of their
motion for an ocular inspection of the crime scene. They suggest
that had it been granted, the accuracy or inexactitude of the
description by SPO1 Javier could have been established. We agree
with the Solicitor General that the ocular inspection would have
been an exercise in futility for the reason that the house had then
long been renovated. On March 2, 1995, when Erlinda Escosio
testified, there were already three (3) rooms in the house. The
renovation was made on February 1995, a month prior to her
[21]
testimony; thus, explaining the testimony of SPO1 Javier that the
house of the Escosios consisted of two (2) rooms on November 11,
1994.
We now come to the crime committed by the appellants. The
Information alleged the circumstances of taking advantage of
superior strength and/or evident premeditation, and charged the
crime of murder. The circumstances that qualify the killing to
murder must be proved indubitably as the killing itself. The
prosecution failed to prove these circumstances.
Abuse of superior strength is present whenever there is inequality of
forces between the victim and the aggressor. This assumes a
situation of superiority of strength notoriously advantageous for the
aggressor and selected or taken advantage of by him in the
commission of the crime. The evidence does not show that
appellants took advantage of their number in order to overpower
the victim. The evidence against appellants is merely circumstantial.
Nor was evident premeditation proved. There is no proof in the
instant case of (a) the time when appellants determined to commit
the crime; (b) an overt act manifestly indicating that they clung to
their determination to commit the crime; and, (c) the lapse of
sufficient period of time between the determination and the
execution of the crime, to allow appellants to reflect upon the

consequences of their act. Hence, this circumstance cannot likewise

be appreciated.
The Solicitor General submits that treachery should be appreciated
against the appellants as Jovito was asleep when killed. He contends
that while treachery was not alleged in the Information, it could be
appreciated as a generic aggravating circumstance. We do not
agree. Erlinda testified that Jovito was asleep prior to the arrival of
appellants but she did not say that he was still sleeping when the
attack commenced. Even assuming that treachery was proved, it
could
not
be
considered
a
generic
aggravating
circumstance. Sections 8 and 9 of the Revised Rules of Criminal
Procedure provide:
Sec. 8. Designation of the Offense. The complaint or information
shall state the designation of the offense given by the statute, aver
the acts or omissions constituting the offense, and specify its
qualifying and aggravating circumstances. If there is no designation
of the offense, reference shall be made to the section or subsection
of the statute punishing it.
Sec. 9. Cause of the accusation. The acts or omissions complained
of as constituting the offense and the qualifying and aggravating
circumstances must be stated in ordinary and concise language and
not necessarily in the language used in the statute but in terms
sufficient to enable a person of common understanding to know
what offense is being charged as well as its qualifying and
aggravating circumstances and for the court to pronounce
judgment.
Clearly, under the aforesaid provisions, aggravating circumstances,
whether qualifying or generic, must be alleged in the information
before they can be considered by the court. These new provisions
apply even if the crime was committed prior to their effectivity since
they are favorable to the accused, as in this case.
Appellants cannot invoke the mitigating circumstance of voluntary
surrender. For voluntary surrender to be considered, it must be
shown that: (1) the offender was not actually arrested; (2) he
surrendered himself to a person in authority or to an agent of that
[22]
person; and, (3) his surrender was voluntary. The records disclose
that appellants voluntarily presented themselves to the Las Pias
[23]
Police Department to clear their name. We have ruled time and
again that the act of a suspect in going to the police station only to
clear his name does not show intent to surrender unconditionally
[24]
to the authorities.
Prescinding from these premises, appellants can only be convicted
of the crime of homicide. The penalty for homicide under Article
249 of the Revised Penal Code is reclusion temporal. Corollarily,
Article 64 (1) provides that when there are neither aggravating nor
mitigating circumstances, the penalty prescribed by law shall be
imposed in its medium period. Applying the Indeterminate Sentence
Law, the maximum penalty to be imposed on appellants should be
taken from the medium period of reclusion temporal, the range of
which is fourteen (14) years, eight (8) months and one (1) day to
seventeen (17) years and four (4) months, while the minimum shall
be taken from the penalty next lower in degree which is prision
mayor,the range of which is six (6) years and one (1) day to twelve
(12) years, in any of its periods.
We now review the damages awarded by the trial court. The civil
indemnity ex delicto given in the amount of P100,000.00 must be
reduced to P50,000.00 in line with recent jurisprudence. In addition,
moral damages must be awarded in the amount of P50,000.00 in
view of the testimony of Randy Caspillo about his surprise and
[25]
hurt as a result of the sudden death of his brother.
The actual damages awarded in the amount of P35,014.00
representing wake, funeral and burial expenses cannot be
sustained. The receipts submitted by witness Randy Caspillo only
prove expenses in the amount of P13,250.00. Nonetheless,
temperate damages in the amount of P25,000.00 can be
awarded. This is in keeping with recent jurisprudence to the effect
that when actual damages established by receipts during trial
amount to less than P25,000.00, which in this case is

only P13,250.00, an award of temperate damages for P25,000.00 is

[26]
justified.

months, as minimum, to 6 years, as maximum, by the Regional Trial

[5]
Court of Quezon City. The trial court found:

IN VIEW WHEREOF, the Decision of the trial court finding appellants

RENATO and RENE TORRECAMPO guilty of murder and imposing
upon them the penalty of death is MODIFIED; they are instead found
guilty of homicide under Article 249 of the Revised Penal Code and
each sentenced to suffer an indeterminate prison term of twelve
(12) years of prision mayormaximum, as minimum, to fourteen (14)
years, eight (8) months and one (1) day of reclusion
temporal medium, as maximum, and to pay the heirs of Jovito
Caspillo P50,000.00 as civil indemnity, P50,000.00 as moral
damages, P25,000.00 as temperate damages, and to pay the costs.

All told, this Court, therefore, holds that the accused, who was then
the driver of MMTC Bus No. 027, is criminally responsible for the
death of the girl victim in violation of Article 365(2) of the Revised
Penal Code. For, in the light of the evidence that the girl victim was
already at the center of the Katipunan Road when she was bumped,
and, therefore, already past the right lane when the MMTC Bus No.
027 was supposed to have passed; and, since the said bus was then
running at a speed of about 25 kilometers per hour which is
inappropriate since Katipunan road is a busy street, there is,
consequently, sufficient proof to show that the accused was
careless, reckless and imprudent in the operation of his MMTC Bus
No. 027, which is made more evident by the circumstance that the
accused did not blow his horn at the time of the accident, and he did
not even know that he had bumped the girl victim and had ran over
her, demonstrating thereby that he did not exercise diligence and
take the necessary precaution to avoid injury to persons in the
operation of his vehicle, as, in fact, he ran over the girl victim who
[6]
died as a result thereof.

SO ORDERED.
Davide, Jr., C.J., Vitug, Panganiban, Quisumbing, Ynares-Santiago,
Sandoval-Gutierrez, Carpio, Austria-Martinez, Corona, CarpioMorales, Callejo, Sr., Azcuna, and Tinga, JJ., concur.

METRO MANILA TRANSIT CORPORATION (MMTC), PEDRO A.

MUSA, CONRADO TOLENTINO, FELICIANA CELEBRADO and THE
GOVERNMENT SERVICE
INSURANCE SYSTEM, petitioners,
vs.
COURT OF APPEALS, SPS. RODOLFO V. ROSALES and LILY
ROSALES, respondents.

The spouses Rosales filed an independent civil action for damages

against MMTC, Musa, MMTC Acting General Manager Conrado
Tolentino, and the Government Service Insurance System (GSIS).
They subsequently amended their complaint to include Feliciana
Celebrado, a dispatcher of the MMTC, as a defendant therein. The
counsel of MMTC and Musa attempted to introduce testimony that
Musa was not negligent in driving Bus No. 27 but was told by the
trial judge:

[G.R. No. 126395. November 16, 1998]

COURT:

RODOLFO V. ROSALES and LILY R. ROSALES, petitioners, vs. THE

COURT OF APPEALS, METRO MANILA TRANSIT CORPORATION
(MMTC), PEDRO A. MUSA, CONRADO TOLENTINO, FELICIANA
CELEBRADO and THE GOVERNMENT SERVICE INSURANCE
SYSTEM, respondents.

That is it. You can now limit your question to the other defendant
here but to re-try again the actual facts of the accident, this Court
would not be in the position. It would be improper for this Court to
make any findings with respect to the negligence of herein
driver. You ask questions only regarding the civil aspect as to the
[7]
other defendant but not as to the accused.

[G.R. No. 116617. November 16, 1998]

DECISION
The counsel submitted to the ruling of the court.

[8]

MENDOZA, J.:
These are appeals brought, on the one hand, by the Metro Manila
Transit Corporation (MMTC) and Pedro Musa and, on the other, by
the spouses Rodolfo V. Rosales and Lily R. Rosales from the
[1]
decision, dated August 5, 1994, of the Court of Appeals, which
affirmed with modification the judgment of the Regional Trial Court
of Quezon City holding MMTC and Musa liable to the spouses
Rosales for actual, moral, and exemplary damages, attorneys fees,
and the costs of suit for the death of the latters daughter. MMTC
and Musa in G.R. No. 116617 appeal insofar as they are held liable
for damages, while the spouses Rosales in G.R. No. 126395 appeal
insofar as the amounts awarded are concerned.
The facts are as follows:
MMTC is the operator of a fleet of passenger buses within the Metro
Manila area. Musa was its driver assigned to MMTC Bus No. 27. The
spouses Rosales were parents of Liza Rosalie, a third-year high
school student at the University of the Philippines Integrated
School.
At around a quarter past one in the afternoon of August 9, 1986,
MMTC Bus No. 27, which was driven by Musa, hit Liza Rosalie who
was then crossing Katipunan Avenue in Quezon City. An eye witness
said the girl was already near the center of the street when the bus,
[2]
then bound for the south, hit her. She fell to the ground upon
impact, rolled between the two front wheels of the bus, and was run
[3]
over by the left rear tires thereof. Her body was dragged several
meters away from the point of impact. Liza Rosalie was taken to the
[4]
Philippine Heart Center, but efforts to revive her proved futile.
Pedro Musa was found guilty of reckless imprudence resulting in
homicide and sentenced to imprisonment for a term of 2 years and 4

In a decision rendered on March 6, 1990, the Regional Trial Court of

Quezon City found MMTC and Musa guilty of negligence and
ordered them to pay damages and attorneys fees, as follows:
WHEREFORE, foregoing premises considered, judgment is hereby
rendered ordering defendant Metro Manila Transit Corporation
primarily and defendant Pedro Musa subsidiarily liable to plaintiffsspouses Rodolfo V. Rosales and Lily R. Rosales as follows:
1. Actual damages in the amount of P150,000.00;
2. Moral damages in the amount of P500,000.00;
3. Exemplary damages in the amount of P100,000.00;
4. Attorneys fees in the amount of P50,000.00; and
5. Costs of suit.

[9]

Both parties appealed to the Court of Appeals. On August 5, 1994,

the Court of Appeals affirmed the decision of the trial court with the
following modification:
WHEREFORE, except for the modification deleting the award
of P150,000.00 as actual damages and awarding in lieu thereof the
amount of P30,000.00 as death indemnity, the decision appealed
[10]
from is, in all other aspects, hereby AFFIRMED.
The spouses Rosales filed a motion for reconsideration, which the
appellate court, in a resolution, dated September 12, 1996, partly
granted by increasing the indemnity for the death of Liza Rosalie
fromP30,000.00 to P50,000.00. Hence, these appeals.

In G.R. No. 116617, MMTC and Musa assail the decision of the Court
of Appeals on the following grounds:
PUBLIC RESPONDENT COURT OF APPEALS ERRED IN AFFIRMING THE
COURT A QUOS DECISION PARTICULARLY IN NOT HOLDING THAT
PETITIONER-APPELLANT MMTC EXERCISED THE DILIGENCE OF A
GOOD FATHER OF A FAMILY IN THE SELECTION AND SUPERVISION
OF ITS DRIVERS. THIS BEING THE CASE, APPELLANT MMTC IS
ENTITLED TO BE ABSOLVED FROM ANY LIABILITY OR AT LEAST TO A
REDUCTION OF THE RECOVERABLE DAMAGES.
THE PUBLIC RESPONDENT COURT OF APPEALS, JUST LIKE THE COURT
A QUO, OVERLOOKED THE FACT THAT PETITIONER MMTC, A
GOVERNMENT-OWNED CORPORATION, COMMITTED NO FRAUD,
MALICE, BAD FAITH, NOR WANTON, FRAUDULENT, OPPRESSIVE AND
MALEVOLENT ACTUATIONS AGAINST HEREIN RESPONDENTSAPPELLEES.
THE PUBLIC RESPONDENT COURT OF APPEALS ERRED IN AFFIRMING
THE COURT A QUOS DECISION TO HOLD PETITIONER-APPELLANT
MMTC PRIMARILY LIABLE TO PRIVATE RESPONDENTS-APPELLEES IN
THE AMOUNT OF P500,000 AS MORAL DAMAGES, P100,000 AS
EXEMPLARY DAMAGES AND P30,000 BY WAY OF DEATH INDEMNITY.
THE PUBLIC RESPONDENT COURT OF APPEALS ERRED IN AFFIRMING
THE COURT A QUOS DECISION IN RENDERING JUDGMENT FOR
ATTORNEYS FEES IN THE AMOUNT OF P50,000.00 IN FAVOR OF
PRIVATE RESPONDENTS-APPELLEES.
On the other hand, in G.R. No. 126395, the spouses Rosales
contend:
The Court of Appeals erred in:
First, considering that death indemnity which this Honorable Court
set at P50,000.00 is akin to actual damages;
Second, not increasing the amount of damages awarded;
Third, refusing to hold all the defendants, now private respondents,
solidarily liable.
MMTC and Musa do not specifically question the findings of the
Court of Appeals and the Regional Trial Court of Quezon City that
Liza Rosalie was hit by MMTC Bus No. 27. Nonetheless, their
[11]
petition contains discussions which cast doubts on this point. Not
only can they not do this as the rule is that an appellant may not be
heard on a question not specifically assigned as error, but the rule
giving great weight, and even finality, to the factual conclusions of
the Court of Appeals which affirm those of the trial court bars a
reversal of the finding of liability against petitioners MMTC and
Musa. Only where it is shown that such findings are whimsical,
capricious, and arbitrary can they be overturned. To the contrary,
the findings of both the Court of Appeals and the Regional Trial
Court are solidly anchored on the evidence submitted by the parties.
We, therefore, regard them as conclusive in resolving the petitions
[12]
at bar. Indeed, as already stated, petitioners counsel submitted
to the ruling of the court that the finding of the trial court in the
criminal case was conclusive on them with regard to the questions
of whether Liza Rosalie was hit by MMTC Bus No. 27 and whether its
driver was negligent. Rather, the issue in this case turns on Art. 2180
of the Civil Code, which provides that employers shall be liable for
the damages caused by their employees and household helpers
acting within the scope of their assigned tasks, even though the
former are not engaged in any business or industry. The
responsibility of employers for the negligence of their employees in
the performance of their duties is primary, that is, the injured party
may recover from the employers directly, regardless of the solvency
[13]
of their employees. The rationale for the rule on vicarious liability
has been adumbrated thus:
What has emerged as the modern justification for vicarious liability
is a rule of policy, a deliberate allocation of a risk. The losses caused
by the torts of employees, which as a practical matter are sure to
occur in the conduct of the employers enterprise, are placed upon

that enterprise itself, as a required cost of doing business. They are

placed upon the employer because, having engaged in an enterprise,
which will on the basis of all past experience involve harm to others
through the tort of employees, and sought to profit by it, it is just
that he, rather than the innocent injured plaintiff, should bear them;
and because he is better able to absorb them, and to distribute
them, through prices, rates or liability insurance, to the public, and
so to shift them to society, to the community at large. Added to this
is the makeweight argument that an employer who is held strictly
liable is under the greatest incentive to be careful in the selection,
instruction and supervision of his servants, and to take every
[14]
precaution to see that the enterprise is conducted safely.
[15]

In Campo v. Camarote, we explained the basis of the presumption

of negligence in this wise:
The reason for the law is obvious. It is indeed difficult for any
person injured by the carelessness of a driver to prove the
negligence or lack of due diligence of the owner of the vehicle in the
choice of the driver. Were we to require the injured party to prove
the owners lack of diligence, the right will in many cases prove
illusory, as seldom does a person in the community, especially in the
cities, have the opportunity to observe the conduct of all possible
car owners therein. So the law imposes the burden of proof of
innocence on the vehicle owner. If the driver is negligent and causes
damage, the law presumes that the owner was negligent and
imposes upon him the burden of proving the contrary.
Employers may be relieved of responsibility for the negligent acts of
their employees within the scope of their assigned tasks only if they
can show that they observed all the diligence of a good father of a
[16]
family to prevent damage. For this purpose, they have the
burden of proving that they have indeed exercised such diligence,
both in the selection of the employee who committed the quasidelict and in the supervision of the performance of his duties.
In the selection of prospective employees, employers are required
to examine them as to their qualifications, experience, and service
[17]
records. On the other hand, with respect to the supervision of
employees, employers should formulate standard operating
procedures, monitor their implementation, and impose disciplinary
[18]
measures for breaches thereof. To establish these factors in a trial
involving the issue of vicarious liability, employers must submit
[19]
concrete proof, including documentary evidence.
In this case, MMTC sought to prove that it exercised the diligence of
a good father of a family with respect to the selection of employees
by presenting mainly testimonial evidence on its hiring
procedure. According to MMTC, applicants are required to submit
professional driving licenses, certifications of work experience, and
clearances from the National Bureau of Investigation; to undergo
tests of their driving skills, concentration, reflexes, and vision; and,
to complete training programs on traffic rules, vehicle maintenance,
[20]
and standard operating procedures during emergency cases.
MMTCs evidence consists entirely of testimonial evidence (1) that
transport supervisors are assigned to oversee field operations in
designated areas; (2) that the maintenance department daily
inspects the engines of the vehicles; and, (3) that for infractions of
[21]
company rules there are corresponding penalties. Although
testimonies were offered that in the case of Pedro Musa all these
[22]
precautions were followed, the records of his interview, of the
results of his examinations, and of his service were not presented.
MMTC submitted brochures and programs of seminars for
prospective employees on vehicle maintenance, traffic regulations,
and driving skills and claimed that applicants are given tests to
[23]
determine driving skills, concentration, reflexes, and vision, but
there is no record that Musa attended such training programs and
passed the said examinations before he was employed. No proof
was presented that Musa did not have any record of traffic
violations. Nor were records of daily inspections, allegedly
conducted by supervisors, ever presented.
Normally, employers keep files concerning the qualifications, work
experience, training, evaluation, and discipline of their

employees. The failure of MMTC to present such documentary

proof puts in doubt the credibility of its witnesses. What was said
in Central Taxicab Corporation v. Ex-Meralco Employees
[24]
Transportation Corporation applies to this case:
This witness spoke of an affidavit of experience which a driverapplicant must accomplish before he is employed by the company, a
written time schedule for each bus, and a record of the inspections
and thorough checks pertaining to each bus before it leaves the car
barn; yet no attempt was ever made to present in evidence any of
these documents, despite the fact that they were obviously in the
possession and control of the defendant company.

Wreaths

2,500.00

Embalment

1,000.00

Obituaries

7,125.00

Interment fees
Expenses during wake
Mourning clothes

....

Photography

Albert also testified that he kept records of the preliminary and final
tests given by him as well as a record of the qualifications and
experience of each of the drivers of the company. It is rather
strange, therefore, that he failed to produce in court the all
important record of Roberto, the driver involved in this case.

Video Coverage

The failure of the defendant company to produce in court any

record or other documentary proof tending to establish that it had
exercised all the diligence of a good father of a family in the
selection and supervision of its drivers and buses, notwithstanding
the calls therefor by both the trial court and the opposing counsel,
argues strongly against its pretensions.
It is noteworthy that, in another case involving MMTC, testimonial
evidence of identical content, which MMTC presented to show that
it exercised the diligence of a good father of a family in the selection
and supervision of employees and thus avoid vicarious liability for
the negligent acts of its employees, was held to be insufficient to
overcome the presumption of negligence against it. In Metro Manila
[25]
Transit Corp. v. Court of Appeals, this Court said:
Coming now to the case at bar, while there is no rule which requires
that testimonial evidence, to hold sway, must be corroborated by
documentary evidence, or even object evidence for that matter,
inasmuch as the witnesses testimonies dwelt on mere generalities,
we cannot consider the same as sufficiently persuasive proof that
there was observance of due diligence in the selection and
supervision of employees. Petitioners attempt to prove
its diligentissimi patris familias in the selection and supervision of
employees through oral evidence must fail as it was unable to
buttress the same with any other evidence, object or documentary,
which might obviate the apparent biased nature of the testimony.
Having found both MMTC and its driver Pedro Musa liable for
negligence for the death of Liza Rosalie on August 9, 1986, we now
consider the question of damages which her parents, the spouses
Rosales, are entitled to recover, which is the subject of the appeal in
G.R. No. 126395.
Indemnity for Death. Art. 2206 provides for the payment of
indemnity for death caused by a crime or quasi-delict. Initially fixed
in said article of the Civil Code at P3,000.00, the amount of the
indemnity has through the years been gradually increased based on
[26]
the value of the peso. At present, it is fixed at P50,000.00. To
conform to this new ruling, the Court of Appeals correctly increased
the indemnity it had originally ordered the spouses Rosales to be
paid from P30,000.00 to P50,000.00 in its resolution, dated
September 12, 1996.
Actual Damages. Art. 2199 provides that except as provided by law
or by stipulation, one is entitled to an adequate compensation only
for such pecuniary loss suffered by him as he has duly proved. The
spouses Rosales are claiming actual damages in the amount
of P239,245.40. However, during the trial, they submitted receipts
showing that expenses for the funeral, wake, and interment of Liza
[27]
Rosalie amounted only to P60,226.65 itemized as follows:
Medical Attendance

P 739.65

Funeral Services

5,100.00

Printing of invitation cards

TOTAL

2,350.00
14,935.00
5,000.00
3,500.00
10,000.00
7,977.00
60,226.65

Hence, apart from the indemnity for death, the spouses Rosales are
entitled to recover the above amount as actual damages.
Moral Damages. Under Art. 2206, the spouse, legitimate and
illegitimate descendants and ascendants of the deceased may
demand moral damages for mental anguish by reason of the death
of the deceased. The reason for the grant of moral damages has
been explained thus:
. . . 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. The intensity of
the pain experienced by the relatives of the victim is proportionate
to the intensity of affection for him and bears no relation
[28]
whatsoever with the wealth or means of the offender.
In the instant case, the spouses Rosales presented evidence of the
intense moral suffering they had gone through as a result of the loss
of Liza Rosalie who was their youngest child. Rodolfo Rosales
recounted the place of Liza Rosalie in the family and their
relationship with her in the following words:
Q: Mr. Rosales, how was Liza to you as a daughter?
A: Well, Liza as a daughter was the greatest joy of the family; she
was our pride, and everybody loved her - all her brothers and sisters
- because she was sweet and unspoiled. . . . She was soft-spoken to
all of us; and she still slept with us at night although she had her
own room. Sometimes in the middle of the night she would open
our door and ask if she could sleep with us. So we let her sleep with
[29]
us, as she was the youngest.
The death of Liza Rosalie left a void in their lives. Rodolfo Rosales
testified on the devastating effect of the death of Liza Rosalie:
Q: And after she died, what changes, if any, did you feel in your
family?
A: Well, there is something hollow in our family, something is
missing. She used to greet me when I came home and smell if I was
drunk and would tell me to dress up and take a shower before her
mommy could see me. She would call me up at the office and say:
Daddy, come home, please help me with my homework. Now, all
these things, I am missing, you know. . . . I do not feel like going
home early. Sometimes my wife would complain and ask: Where
[30]
did you go? But I cannot explain to her how I feel.
Lily Rosales described life without Liza Rosalie thus:
Q: Now, your life without Liza, how would you describe it, Dr.
Rosales?

A: You know it is very hard to describe. The family was broken

apart. We could not go together because we remember Liza. Every
time we go to the cemetery we try as much as possible not to go
together. So, we go to the cemetery one at a time, sometimes, my
husband and I, or my son and another one, but we never go
together because we remember Liza. But before her death we
would always be together, the whole family on weekends and on
our days off. My husband works very hard, I also work very hard
and my children go to school. They study very hard. Now we cannot
[31]
go together on outings because of the absence of Liza.

intelligent and all-American. He received high marks in

school. He was active in church affairs and participated in
recreational and athletic events, often with children older than
himself. In addition, he had an unusual talent for creating numerous
cartoons and other drawings, some of which plaintiffs introduced at
trial.

The spouses Rosales claim moral damages in the amount

[32]
of P5,000,000.00. In People v. Teehankee, Jr., this Court
awarded P1 million as moral damages to the heirs of a seventeenyear-old girl who was murdered. This amount seems reasonable to
us as moral damages for the loss of a minor child, whether he or she
was a victim of a crime or a quasi-delict. Hence, we hold that the
MMTC and Musa are solidarily liable to the spouses Rosales in the
amount of P1,000,000.00 as moral damages for the death of Liza
Rosalie.

Upon analysis of the record, we conclude that we should not disturb

the award.

Exemplary Damages. Art. 2231 provides that exemplary damages

may be recovered in cases involving quasi-delicts if the defendant
acted with gross negligence. This circumstance obtains in the
instant case. The records indicate that at the time of the mishap,
there was a pending criminal case against Musa for reckless
imprudence resulting in slight physical injuries with another branch
[33]
of the Regional Trial Court, Quezon City. The evidence also shows
that he failed to stop his vehicle at once even after eye witnesses
shouted at him. The spouses Rosales claim exemplary damages in
the amount of P5,000,000.00. Under the circumstances, we deem it
reasonable to award the spouses Rosales exemplary damages in the
amount of five hundred thousand pesos (P500,000.00).
Attorneys Fees. Pursuant to Art. 2208, attorneys fees may be
recovered when, as in the instant case, exemplary damages are
awarded. In the recent case of Sulpicio Lines, Inc. v. Court of
[34]
Appeals, which involved the death of a minor child in the sinking
of a vessel, we held an award of P50,000.00 as attorneys fees to be
reasonable. Hence, we affirm the award of attorneys fees made by
the Court of Appeals to the spouses Rosales in that amount.
Compensation for Loss of Earning Capacity. Art. 2206 of the Civil
Code provides that in addition to the indemnity for death caused by
a crime or quasi delict, 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; . . . . Compensation of this nature is
awarded not for loss of earnings but for loss of capacity to earn
[35]
money. Evidence must be presented that the victim, if not yet
employed at the time of death, was reasonably certain to complete
[36]
[37]
training for a specific profession. In People v. Teehankee, no
award of compensation for loss of earning capacity was granted to
the heirs of a college freshman because there was no sufficient
evidence on record to show that the victim would eventually
[38]
become a professional pilot. But compensation should be allowed
for loss of earning capacity resulting from the death of a minor who
has not yet commenced employment or training for a specific
profession if sufficient evidence is presented to establish the
amount thereof. In the United States it has been observed:
This raises the broader question of the proper measure of damages
in death cases involving children, housewives, the old, and others
who do not have market income so that there is no pecuniary loss
to survivors or to the estate of the decedent. The traditional
approach was
to
award
no
or
merely
nominal damages in such cases. . . . Increasingly, however, courts
[39]
allow expert testimony to be used to project those lost earnings.
[40]

Thus, in Haumersen v. Ford Motor Co., the court allowed the

heirs of a seven-year-old boy who was killed in a car accident to
recover compensation for loss of earning capacity:
Considerable evidence was presented by plaintiffs in an effort to
give the jury a foundation on which to make an award. Briefly
stated, this evidence showed Charles Haumersen was a seven-yearold of above average characteristics. He was described as very

The record does not disclose passion and prejudice. The key
question is whether the verdict of $100,000 has support in the
evidence.

The argument for allowing compensation for loss of earning capacity

of a minor is even stronger if he or she was a student, whether
already training for a specific profession or still engaged in general
[41]
studies. In Krohmer v. Dahl, the court, in affirming the award by
the jury of $85,000.00 to the heirs of an eighteen-year-old college
freshman who died of carbon monoxide poisoning, stated as
follows:
There are numerous cases that have held admissible evidence of
prospective earnings of a student or trainee. . . . The appellants
contend that such evidence is not admissible unless the course
under study relates to a given occupation or profession and it is
shown that the student is reasonably certain to follow that
occupation or profession. It is true that the majority of these
decisions deal with students who are studying for a specific
occupation or profession. However, not one of these cases indicate
that evidence of ones education as a guide to future earnings is not
admissible where the student is engaged in general studies or whose
education does not relate to a specific occupation.
In sharp contrast with the situation obtaining in People v.
Teehankee, where the prosecution merely presented evidence to
show the fact of the victims graduation from high school and the
fact of his enrollment in a flying school, the spouses Rosales did not
content themselves with simply establishing Liza Rosalies
enrollment at UP Integrated School. They presented evidence to
show that Liza Rosalie was a good student, promising artist, and
obedient child. She consistently performed well in her studies since
[42]
grade school. A survey taken in 1984 when Liza Rosalie was
twelve years old showed that she had good study habits and
[43]
attitudes. Cleofe Chi, guidance counselor of the University of the
Philippines Integrated School, described Liza Rosalie as personable,
[44]
well-liked, and with a balanced personality. Professor Alfredo
Rebillon, a faculty member of the University of the Philippines
College of Fine Arts, who organized workshops which Liza Rosalie
attended
in
1982
and
1983,
testified that Liza Rosalie had the potential
of
eventually
[45]
becoming an artist. Professor Rebillons testimony is more than
sufficiently established by the 51 samples of Liza Rosalies
watercolor, charcoal, and pencil drawings submitted as exhibits by
[46]
the spouses Rosales. Neither MMTC nor Pedro Musa
controverted this evidence.
Considering her good academic record, extra-curricular activities,
and varied interests, it is reasonable to assume that Liza Rosalie
would have enjoyed a successful professional career had it not been
for her untimely death. Hence, it is proper that compensation for
loss of earning capacity should be awarded to her heirs in
[47]
accordance with the formula established in decided cases for
computing net earning capacity, to wit:
Gross
Net Earning
Capacity

Life
=

Necessary

Annual - Living

Expectancy

Income
2

Expenses

Life expectancy is equivalent to two thirds ( /3) multiplied by the

[48]
difference of eighty (80) and the age of the deceased. Since Liza
Rosalie was 16 at the time of her death, her life expectancy was 44
[49]
more years. Her projected gross annual income, computed based

on the minimum wage for workers in the non-agricultural sector in

[50]
effect
at
the
time
of
her
death, then
fixed
[51]
[52]
at P37.00, isP14,630.46. Allowing for necessary living expenses
[53]
of fifty percent (50%) of her projected gross annual income, her
[54]
total net earning capacity amounts to P321,870.12.

3) moral damages
(P1,000,000.00);

in

the

amount

of

one

million

pesos

Finally, the spouses Rosales argue that the Court of Appeals erred in
absolving Conrado Tolentino, Feliciana Celebrado, and the GSIS of
liability. The spouses Rosales alleged that Tolentino, as Acting
General Manager of the MMTC, and Celebrado, as a dispatcher
thereof, were charged with the supervision of Musa and should,
therefore, be held vicariously liable under Art. 2180 of the Civil
Code. With respect to the GSIS, they contend that it was the insurer
in a contract for third party liability it had with the MMTC.

5) attorneys fees in the amount of fifty thousand pesos

(P50,000.00);

4) exemplary damages in the amount of five hundred thousand

pesos (P500,000.00);

6) compensation for loss of earning capacity in the amount of three

hundred twenty-one thousand eight hundred seventy pesos and
twelve centavos (P321,870.12); and
7) the costs of suit.

Although the fourth paragraph of Art. 2180 mentions managers

among those made responsible for the negligent acts of others, it is
settled that this term is used in the said provision in the sense of
[55]
employers. Thus, Tolentino and Celebrado cannot be held liable
for the tort of Pedro Musa.
[56]

In Vda. de Maglana v. Consolacion, it was ruled that an insurer in

an indemnity contract for third party liability is directly liable to the
injured party up to the extent specified in the agreement, but it
cannot be held solidarily liable beyond that amount. The GSIS
admitted in its answer that it was the insurer of the MMTC for third
party liability with respect to MMTC Bus No. 27 to the extent
[57]
ofP50,000.00. Hence, the spouses Rosales have the option either
to claim the said amount from the GSIS and the balance of the
award from MMTC and Musa or to enforce the entire judgment
against the latter, subject to reimbursement from the former to the
[58]
extent of the insurance coverage.

SO ORDERED.
Melo (Acting Chairman) and Puno, JJ., concur.
Martinez, J., no part. On official leave.
THIRD DIVISION

P H I L I P P I NE

HAWK

CORPORATION,

One last word. The Regional Trial Court of Quezon City erred in
holding MMTC primarily and Musa secondarily liable for damages
arising from the death of Liza Rosalie. It was error for the appellate
court to affirm this aspect of the trial courts decision.

Petitioner,

WHEREFORE, the decision of the Court of Appeals is SET ASIDE and

another one is RENDERED holding the Metro Manila Transit
Corporation and Pedro Musa jointly and severally liable for the
death of Liza Rosalie R. Rosales and ORDERING them as such to pay
to the spouses Rodolfo V. Rosales and Lily R. Rosales the following
amounts:

Chairperson

,
VELASCO, JR.,
NACHURA,
-versusPERALTA, and
MENDOZA, JJ.

Promulgated:

VIVIAN TAN LEE,

February 16, 2010
Respondent
.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

DECISION

1) death indemnity in the amount of fifty thousand pesos

(P50,000.00);
PERALTA, J.:
2) actual damages in the amount of sixty thousand two hundred
twenty six pesos and sixty five centavos (P60,226.65);

Present:

CORONA, J.,

As already stated, MMTC is primarily liable for damages for the

negligence of its employee in view of Art. 2180. Pursuant to Art.
2181, it can recover from its employee what it may pay. This does
not make the employees liability subsidiary. It only means that if the
judgment for damages is satisfied by the common carrier, the latter
has a right to recover what it has paid from its employee who
committed the fault or negligence which gave rise to the action
[59]
based on quasi-delict. Hence, the spouses Rosales have the
option of enforcing the judgment against either MMTC or Musa.
From another point of view, Art. 2194 provides that the
responsibility of two or more persons who are liable for a quasi[60]
delict is solidary. We ruled in Gelisan v. Alday that the
registered owner/operator of a public service vehicle is jointly and
severally liable with the driver for damages incurred by passengers
or third persons as a consequence of injuries sustained in the
operation of said vehicle. In Baliwag Transit, Inc. v. Court of
[61]
Appeals it was held that to escape solidary liability for a quasidelict committed by an employee, the employer must adduce
sufficient proof that it exercised such degree of care. Finally, we
held in the recent case of Philtranco Service Enterprises, Inc. v. Court
[62]
of Appeals that the liability of the registered owner of a public
service vehicle . . . for damages arising from the tortious acts of the
driver is primary, direct, and joint and several or solidary with the
driver.

G.R. No. 166869

[1]

This is a Petition for Review on Certiorari of the Decision of the

Court of Appeals in CA-G.R. CV No. 70860, promulgated on August
17, 2004, affirming with modification the Decision of the Regional
Trial Court (RTC) of Quezon City, Branch 102, dated March 16, 2001,
in Civil Case No. Q-91-9191, ordering petitioner Philippine Hawk
Corporation and Margarito Avila to jointly and severally pay
respondent Vivian Tan Lee damages as a result of a vehicular
accident.

The parties also agreed on the following issues:

1. Whether or not the proximate cause of the accident causing

physical injuries upon the plaintiff Vivian Lee Tan and resulting in the
death of the latters husband was the recklessness and negligence of
Margarito Avila or the deceased Silvino Tan; and

The facts are as follows:

On March 15, 2005, respondent Vivian Tan Lee filed before the RTC
[2]
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 on
March 17, 1991 in Barangay Buensoceso, Gumaca, Quezon. The
accident resulted in the death of respondents husband, Silvino Tan,
and caused respondent physical injuries.

[3]

On June 18, 1992, 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.

The accident involved a motorcycle, a passenger jeep, and a bus

with Body No. 119. The bus was owned by petitioner Philippine
Hawk Corporation, and was then being driven by Margarito Avila.

2. Whether or not defendant Philippine Hawk Transport

Corporation exercised the diligence of a good father of the family in
[7]
the selection and supervision of its driver Margarito Avila.

Respondent testified that on March 17, 1991, she was riding on

their motorcycle in tandem with her husband, who was on the
wheel, at a place after a Caltex gasoline station in Barangay
Buensoceso, Gumaca, Quezon on the way to Lopez, Quezon. They
came from the Pasumbal Machine Shop, where they inquired about
the repair of their tanker. They were on a stop position at the side
of the highway; and when they were about to make a turn, she saw
a bus running at fast speed coming toward them, and then the bus
hit a jeep parked on the roadside, and their motorcycle as well. She
lost consciousness and was brought to the hospital in Gumaca,
Quezon, where she was confined for a week. She was later
transferred to St. Lukes Hospital in Quezon City, Manila. She
suffered a fracture on her left chest, her left arm became swollen,
[8]
she felt pain in her bones, and had high blood pressure.
Respondents husband died due to the vehicular accident. The
[9]
immediate cause of his death was massive cerebral hemorrhage.

[4]

In its Answer, 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.

[10]

Respondent further testified that her husband was leasing and

operating a Caltex gasoline station in Gumaca, Quezon that
yielded one million pesos a year in revenue. They also had a copra
business, which gave them an income of P3,000.00 a month
[11]
or P36,000.00 a year.

[5]

On March 25, 1993, the trial court issued a Pre-trial Order stating
that the parties manifested that there was no possibility of amicable
settlement between them. However, they agreed to stipulate on the
following facts:

1. On March 17, 1991, in Bgy. Buensoceso, Gumaca, Quezon,

plaintiff Vivian Lee Tan and her husband Silvino Tan, while on board
a motorcycle with [P]late No. DA-5480 driven by the latter, and a
Metro Bus with [P]late No. NXR-262 driven by Margarito Avila, were
involved in an accident;
2. As a result of the accident, Silvino Tan died on the spot while
plaintiff Vivian Lee Tan suffered physical injuries which necessitated
medical attention and hospitalization;
3. The deceased Silvino Tan is survived by his wife, plaintiff Vivian
Lee Tan and four children, three of whom are now residents of the
United States; and
4. Defendant Margarito Avila is an employee of defendant
[6]
Philippine Hawk.

Ernest Ovial, the driver of the passenger jeep involved in the

accident, testified that in the afternoon of March 17, 1991, his jeep
was parked on the left side of the highway near the Pasumbal
Machine Shop. He did not notice the motorcycle before the
accident. But he saw the bus dragging the motorcycle along the
[12]
highway, and then the bus bumped his jeep and sped away.

For the defense, Margarito Avila, the driver of petitioners

bus, testified that on March 17, 1999, at about 4:30 p.m., he was
driving his bus at 60 kilometers per hour on the Maharlika
Highway. When they were at Barangay Buensoceso, Gumaca,
Quezon, a motorcycle ran from his left side of the highway, and as
the bus came near, the motorcycle crossed the path of the bus, and
so he turned the bus to the right. He heard a loud banging sound.
From his side mirror, he saw that the motorcycle turned turtle
(bumaliktad). He did not stop to help out of fear for his life, but
drove on and surrendered to the police. He denied that he bumped
[13]
the motorcycle.

Avila further testified that he had previously been involved in

[14]
sideswiping incidents, but he forgot how many times.

Rodolfo Ilagan, the bus conductor, testified that the motorcycle

bumped the left side of the bus that was running at 40 kilometers
[15]
per hour.

Domingo S. Sisperes, operations officer of petitioner, testified that,

like their other drivers, Avila was subjected to and passed the
following requirements:

hit the passenger jeep, which was then parked on the left side of the
road. The fact that the bus also hit the passenger jeep showed that
the bus must have been running from the right lane to the left lane
of the highway, which caused the collision with the motorcycle and
the passenger jeep parked on the left side of the road. The trial
court stated that since Avila saw the motorcycle before the collision,
he should have stepped on the brakes and slowed down, but he just
[20]
maintained his speed and veered to the left.
The trial court found
Margarito Avila guilty of simple negligence.

The trial court held petitioner bus company liable for failing to
exercise the diligence of a good father of the family in the selection
and supervision of Avila, having failed to sufficiently inculcate in him
[21]
discipline and correct behavior on the road.

(1) Submission of NBI clearance;

(2) Certification from his previous employer that he had no
bad record;

On appeal, the Court of Appeals affirmed the decision of the trial

court with modification in the award of damages. The dispositive
portion of the decision reads:

(3) Physical examination to determine his fitness to drive;

(4) Test of his driving ability, particularly his defensive skill; and
(5) Review of his driving skill every six months.

[16]

Efren Delantar, a Barangay Kagawad in Buensoceso, Gumaca,

Quezon, testified that the bus was running on the highway on a
straight path when a motorcycle, with a woman behind its driver,
suddenly emerged from the left side of the road from a machine
shop. The motorcycle crossed the highway in a zigzag manner and
[17]
bumped the side of the bus.

In its Decision dated March 16, 2001, the trial court rendered
judgment against petitioner and defendant Margarito Avila, the
dispositive portion of which reads:

ACCORDINGLY, MARGARITO AVILA is adjudged guilty of simple

negligence, and judgment is hereby rendered in favor of the plaintiff
Vivian Lee Tan and h*er+ husbands heirs ordering the defendants
Philippine Hawk Corporation and Margarito Avila to pay them jointly
and solidarily the sum of P745,575.00 representing loss of earnings
[18]
and actual damages plusP50,000.00 as moral damages.

The trial court found that before the collision, the motorcycle was
on the left side of the road, just as the passenger jeep was. Prior to
the accident, the motorcycle was in a running position moving
toward the right side of the highway. The trial court agreed with the
bus driver that the motorcycle was moving ahead of the bus from
the left side of the road toward the right side of the road, but
disagreed that the motorcycle crossed the path of the bus while the
[19]
bus was running on the right side of the road.

The trial court held that if the bus were on the right side of the
highway, and Margarito Avila turned his bus to the right in an
attempt to avoid hitting the motorcyle, then the bus would not have

WHEREFORE, foregoing premises considered, the appeal is

DENIED. The assailed decision dated March 16, 2001 is hereby
AFFIRMED with MODIFICATION. Appellants Philippine Hawk and
Avila are hereby ordered to pay jointly and severally appellee the
following
amount: (a) P168,019.55
as
actual
damages;
(b) P10,000.00 as temperate damages; (c)P100,000.00 as moral
damages; (d) P590,000.00 as unearned income; and (e) P50,000.00
[22]
as civil indemnity.

Petitioner filed this petition, raising the following issues:

1) The Court of Appeals committed grave abuse of discretion

amounting to lack of jurisdiction in passing upon an issue, which had
not been raised on appeal, and which had, therefore, attained
finality, in total disregard of the doctrine laid down by this Court
in Abubakar v. Abubakar, G.R. No. 134622, October 22, 1999.

2) The Court of Appeals committed reversible error in its finding

that the petitioners bus driver saw the motorcycle of private
respondent executing a U-turn on the highway about fifteen (15)
meters away and thereafter held that the Doctrine of Last Clear
was applicable to the instant case. This was a palpable error for the
simple reason that the aforesaid distance was the distance of the
witness to the bus and not the distance of the bus to the
respondents motorcycle, as clearly borne out by the records.

3) The Court of Appeals committed reversible error in awarding

damages in total disregard of the established doctrine laid down
in Danao v. Court of Appeals, 154 SCRA 447 and Viron
Transportation Co., Inc. v. Delos Santos, G.R. No. 138296, November
[23]
22, 2000.

In short, the issues raised by petitioner are: (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; (2) whether or not petitioner is liable to
respondent for damages; and (3) whether or not the damages
awarded by respondent Court of Appeals are proper.

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.

Petitioner seeks a review of the factual findings of the trial court,

which were sustained by the Court of Appeals, that petitioners
driver was negligent in driving the bus, which caused physical
injuries to respondent and the death of respondents husband.

Whenever an employees negligence causes damage or injury to

another, there instantly arises a presumption that the employer
failed to exercise the due diligence of a good father of the family in
[29]
the selection or supervision of its employees. To avoid liability for
a quasi-delict committed by his employee, an employer must
overcome the presumption by presenting convincing proof that he
exercised the care and diligence of a good father of a family in the
[30]
selection and supervision of his employee.

The rule is settled that the findings of the trial court, especially when
affirmed by the Court of Appeals, are conclusive on this Court when
[24]
supported by the evidence on record.
The Court has carefully
reviewed the records of this case, and found no cogent reason to
disturb the findings of the trial court, thus:

The Court agree[s] with the bus driver Margarito that the
motorcycle was moving ahead of the bus towards the right side
from the left side of the road, but disagrees with him that it crossed
the path of the bus while the bus was running on the right side of
the highway.

If the bus were on the right side of the highway and Margarito
turned his bus to the right in an attempt to avoid hitting it, then the
bus would not have hit the passenger jeep vehicle which was then
parked on the left side of the road. The fact that the bus hit the jeep
too, shows that the bus must have been running to the left lane of
the highway from right to the left, that the collision between it and
the parked jeep and the moving rightways cycle became inevitable.
Besides, Margarito said he saw the motorcycle before the collision
ahead of the bus; that being so, an extra-cautious public utility
driver should have stepped on his brakes and slowed down. Here,
the bus never slowed down, it simply maintained its highway speed
[25]
and veered to the left. This is negligence indeed.

Petitioner contends that the Court of Appeals was mistaken in

stating that the bus driver saw respondents motorcycle about 15
meters away before the collision, because the said distance, as
testified to by its witness Efren Delantar Ong, was Ongs distance
from the bus, and not the distance of the bus from the
motorcycle. Petitioner asserts that this mistaken assumption of the
Court of Appeals made it conclude that the bus driver, Margarito
Avila, had the last clear chance to avoid the accident, which was the
basis for the conclusion that Avila was guilty of simple negligence.

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. Indeed, petitioners tests were concentrated on the ability to
drive and physical fitness to do so. It also did not know that Avila
had been previously involved in sideswiping incidents.
As regards the issue on the damages awarded, petitioner contends
that it was the only one that appealed the decision of the trial court
with respect to the award of actual and moral damages; hence, the
Court of Appeals erred in awarding other kinds of damages in favor
of respondent, who did not appeal from the trial courts decision.

Petitioners contention is unmeritorious.

Section 8, Rule 51 of the 1997 Rules of Civil Procedure provides:

SEC. 8. Questions that may be decided. -- No error which does not

affect the jurisdiction over the subject matter or the validity of the
judgment appealed from or the proceedings therein will be
considered unless stated in the assignment of errors, or closely
related to or dependent on an assigned error and properly argued in
the brief, save as the court pass upon plain errors and clerical errors.

[31]

Philippine National Bank v. Rabat cited the book

Florenz D. Regalado to explain the section above, thus:
A review of the records showed that it was petitioners witness,
Efren Delantar Ong, who was about 15 meters away from the bus
[26]
when he saw the vehicular accident. Nevertheless, this fact does
not affect the finding of the trial court that petitioners bus driver,
Margarito Avila, was guilty of simple negligence as affirmed by the
appellate court. Foreseeability is the fundamental test of
[27]
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
[28]
unreasonably subjected to a general but definite class of risks.

[32]

of Justice

In his book, Mr. Justice Florenz D. Regalado commented on this

section, thus:
1. Sec. 8, which is an amendment of the former Sec. 7 of this Rule,
now includes some substantial changes in the rules on assignment of
errors. The basic procedural rule is that only errors claimed and
assigned by a party will be considered by the court, except errors
affecting its jurisdiction over the subject matter. To this exception
has now been added errors affecting the validity of the judgment
appealed from or the proceedings therein.

Also, even if the error complained of by a party is not expressly

stated in his assignment of errors but the same is closely related to
or dependent on an assigned error and properly argued in his brief,
such error may now be considered by the court. These changes are
of jurisprudential origin.
2. The procedure in the Supreme Court being generally the same
as that in the Court of Appeals, unless otherwise indicated (see
Secs. 2 and 4, Rule 56), it has been held that the latter is clothed
with ample authority to review matters, even if they are not
assigned as errors on appeal, if it finds that their consideration is
necessary in arriving at a just decision of the case. Also, an
unassigned error closely related to an error properly assigned (PCIB
vs. CA, et al., L-34931, Mar. 18, 1988), or upon which the
determination of the question raised by error properly assigned is
dependent, will be considered by the appellate court
notwithstanding the failure to assign it as error (Ortigas, Jr. vs.
Lufthansa German Airlines, L-28773, June 30, 1975; Soco vs.
Militante, et al., G.R. No. 58961, June 28, 1983).
It may also be observed that under Sec. 8 of this Rule, the appellate
court is authorized to consider a plain error, although it was not
specifically assigned by the appellant (Dilag vs. Heirs of Resurreccion,
76 Phil. 649), otherwise it would be sacrificing substance for
[33]
technicalities.

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
[39]
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

Reasonable and

In this case for damages based on quasi-delict, the trial court

awarded respondent the sum of P745,575.00, representing loss of
earning capacity (P590,000.00) and actual damages (P155,575.00 for
funeral expenses), plus P50,000.00 as moral damages. On appeal to
the Court of Appeals, petitioner assigned as error the award of
damages by the trial court on the ground that it was based merely
on suppositions and surmises, not the admissions made by
respondent during the trial.

In its Decision, the Court of Appeals sustained the award by the trial
court for loss of earning capacity of the deceased Silvino Tan, moral
damages for his death, and actual damages, although the amount of
the latter award was modified.

Capacity
[2/3
the
(GAI)

x Gross Annual Income

(80-age
Necessary

time of death)]

at

Expenses
(80% of GAI)

X
=
P800,000.00

[2/3

X
= 2/3
P100,000.00

(80-65)]

P1,000,000.00

(15)

P200,000.00

(Living
Expenses)
The indemnity for loss of earning capacity of the deceased is
[34]
provided for by Article 2206 of the Civil Code. Compensation of
this nature is awarded not for loss of earnings, but for loss of
[35]
capacity to earn money.

As a rule, documentary evidence should be presented to

[36]
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
[37]
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
[38]
1990, which showed that respondents husband earned a gross
income of P950,988.43 in 1990. It is reasonable to use the Certificate

= 30/3

P100,000.00

= 10

P100,000.00

= 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
[40]
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.

Costs against petitioner.

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
[41]
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
[42]
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
[43]
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
[44]
circumstances.

The Court of Appeals also correctly awarded respondent moral

damages for the physical injuries she sustained due to the vehicular
[45]
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
[46]
with prevailing jurisprudence.

Further, the Court of Appeals correctly awarded respondent civil

indemnity for the death of her husband, which has been fixed by
[47]
current jurisprudence at P50,000.00. The award is proper under
[48]
Art. 2206 of the Civil Code.

In fine, 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
[49]
case.

WHEREFORE, the petition is DENIED. The Decision of the Court of

Appeals dated August 17, 2004 in CA-G.R. CV No. 70860 is
hereby AFFIRMED withMODIFICATION. Petitioner Philippine Hawk
Corporation and Margarito Avila are hereby ordered to pay jointly
and severally respondent Vivian Lee Tan: (a) civil indemnity in the
amount of Fifty Thousand Pesos (P50,000.00); (b) actual damages in
the amount of One Hundred Twenty-Seven Thousand One Hundred
Ninety-Two Pesos and Eighty-Five Centavos ( P127,192.85); (c)
moral damages in the amount of Eighty Thousand Pesos
(P80,000.00); (d) indemnity for loss of earning capacity in the
amount of One Million Pesos (P1,000,000.00); and (e) temperate
damages in the amount of Ten Thousand Pesos (P10,000.00).

SO ORDERED.

Republic
SUPREME
Manila

of

the

Philippines
COURT

FIRST DIVISION
G.R. No. L-35157 April 17, 1984
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.

RELOVA, J.:+.wph!1
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, namely:
Roberto Reyes, Chairman; Felicidad Garcia, Nacionalista Party
inspector; Jorge Primo, Liberal Party inspector; and 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, committed in
the following manner, to wit: t.hqw
That during voting time on November 9, 1965, being an election day,
in Precinct No. 25 located at the Public School Building in the Barrio
of Bislig, Municipality of San Andres, Catanduanes, Philippines, and
within the jurisdiction of this Honorable Commission, the abovenamed respondents conspiring, confederating, collaborating and
mutually helping each other did then and there wilfully, criminally,
feloniously and unlawfully
(a) tolerate, allow and permit numerous registered voters of said
precinct to prepare their ballots with the use of carbon paper or
means for making copies of the ballots to Identify the votes of said
voters in violation of Sec. 135 of the Revised Election Code;
(b) tolerate, allow and permit said voters to cast their unlawfully
prepared ballots, and further tolerate, allow and permit said voters
to step out of the polling place with the unlawfully made copies of
the ballots, in their possession;
(c) prevent the filing of protests and -refuse to give protest forms to
in spite of lawful demands by the Nacionalista election watchers
who wanted to file their protests, against the manner of voting
above-described;
(d) accept the unlawfully prepared ballots and placed them in the
box for valid ballots and later read, counted and credited them in

favor of the candidates whose names were written thereon

including Jose M. Alberto who was also a candidate for the same
position as the complainant;
(e) falsify the truth by making it appear in their official records that
there were no anomalies in the voting and no protests against
anomalies;
all of which unlawful acts violated the free and untrammeled
expression of the sovereign will of the people and cause damage to
the complainant. (pp. 45-46, Rollo)
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." (p. 46, Rollo)
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; that he never had any personal grudge or ill-feeling against
private respondent previously and his only purpose in filing the
administrative complaint was to deter the commission of the acts
charged for the sake of democracy; that he even asked for the
dismissal of all administrative cases he had filed against many
teachers in their conduct of the 1965 elections because he had no
intention of demeaning and degrading them and because he was
satisfied with the action taken by the Commission in connection
with the election cases in the provinces of Batanes and Cotabato.
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 trial court on this point
said: t.hqw
... The best and most reliable proof showing the Identities of the
officials of Precinct No. 25 who reported for duty on November 9,
1965, is the minutes of voting which is supposed to be the authentic
record of the proceedings in the precinct during election day (Exhibit
A) and the election return showing the result of the canvass of the
votes in the precinct which are all required to be accomplished and
signed by the chairman and members of the board of election
inspectors including the poll clerk. In both documents 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. ( 49, Rollo)
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. The very complaint
itself shows upon itself that it was not directed solely at the plaintiff
but was in fact against all the members of the board of election
inspectors of Precinct No. 25 of which the plaintiff was only the poll
clerk. In fact it would appear from a fair and impartial appraisal of
the charges that the major responsibility is lodged against the
chairman and the two other inspectors who by law control the
proceedings in the board. The poll clerk is comparatively a minor
official in the board and there is nothing in the complaint which will
show that it was directed solely for the purpose of harassing and
injuring the reputation of the plaintiff. The chairman and the two
other election inspectors who were made respondents have not

taken offense and their conduct induces the impression that they
either did not feel aggrieved or felt that the dismissal of the
complaint was enough vindication of their honor if in one way or
another it became involved as a result of the charges. ... Under the
circumstances, the action taken by the defendant can hardly be
construed as motivated by malice and intended to harass and injure
her reputation." (pp. 50-51, Rollo) Notwithstanding, the lower court
rendered judgment ordering herein petitioner to indemnify private
respondent the sum of P12,000.00 as compensatory damages.
Hence, the filing of this petition for review by way of certiorari to set
aside the order of respondent judge in awarding private respondent
compensatory damages in the amount of P2,000.00.
There is merit in the petition. Respondent judge found no basis for
actual or compensatory damages and exemplary damages when it
said that "to slap a heavy damage upon the defendant would be
tantamount to imposing a prohibitive premium upon the filing of
complaints against public officials for misconduct in office, a policy
that is neither sound nor conducive to a healthy development of
civic courage and public interest so necessary and indispensable in
the conduct of the affairs of the government (pp. 53-54, Rollo).
Besides, 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, 109 Phil. 16, 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 Id 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.
SO ORDERED.1wph1.t
Teehankee (Chairman), Gutierrez, Jr. and De la Fuente, JJ., concur.
Plana, J., concur in the result.
Melencio Herrera, J., took no part.
FIRST DIVISION
[G.R. No. 141011. July 19, 2001]
CITYTRUST BANKING CORPORATION (now Bank of the Philippine
Islands), petitioner, vs. ISAGANI C. VILLANUEVA, respondent.
[G.R. No. 141028. July 19, 2001]
ISAGANI C. VILLANUEVA, petitioner, vs. CITYTRUST BANKING
CORPORATION, respondent.
DECISION
DAVIDE, JR., C.J.:
In these consolidated cases, the Court is called upon to determine
whether the repeated dishonor of a check drawn against a wellfunded account but bearing the account number of another
depositor with the same name and surname as the drawer would

entitle the drawer to compensatory and moral damages and to

attorneys fees.
The antecedent facts are as follows:
Sometime in February 1984, Isagani C. Villanueva (hereafter
VILLANUEVA) opened a savings account and a current account with
Citytrust Banking Corporation (hereafter the BANK), which were
assigned account numbers 1-033-02337-1 and 33-00977-5,
respectively, with an automatic transfer arrangement.
On 21 May 1986, VILLANUEVA deposited some money in his savings
account with the BANKs Legaspi Village Branch in Makati, Metro
Manila. Realizing that he had run out of blank checks, VILLANUEVA
requested a new checkbook from one of the BANKs customer
service representatives. He then filled up a checkbook requisition
slip with the obligatory particulars, except for his current account
number which he could not remember. He expressed his
predicament to a lady customer service representative of the BANK,
who in turn assured him that she could supply the information from
the BANKs account records. After signing the requisition slip, he
[1]
gave it to her.
Pia Rempillo, another customer service representative of the BANK,
saw VILLANUEVAs checkbook requisition slip. She took it and
proceeded to check the BANKs checkbook register which contained
all the names and account numbers of the BANKs clients who were
issued checkbooks. Upon seeing the name Isagani Villanueva -Account No. 33-00446-3 in the checkbook register, Rempillo copied
the aforesaid account number on the space intended for it in
[2]
VILLANUEVAs requisition slip.
On 17 June 1986, VILLANUEVA received from the BANK his
requested checkbook. On the same day, he immediately signed
Check No. 396701 bearing the amount of P50,000 payable to the
order of Kingly Commodities Traders and Multi Resources, Inc.
(hereafter Kingly Commodities). VILLANUEVA thereafter delivered
the check to Helen Chu, his investment consultant at Kingly
Commodities, with his express instruction to use said check in
placing a trading order at Kingly Commodities future trading
[3]
business as soon as a favorable opportunity presented itself.
Two days later, or on 19 June 1986, VILLANUEVA received a call from
Helen Chu, informing him that she had already placed a trading
order in his behalf and delivered the check to Kingly
Commodities. The check was deposited with the China Banking
Corporation. The next day, he deposited P31,600 in cash to his
savings account to cover the full amount of the check he issued. His
[4]
deposits in both accounts totalled P51,304.91.
However, on 23 June 1986, VILLANUEVAs Check No. 396701 was
dishonored due to insufficiency of funds and disparity in the
signature. VILLANUEVA called Kingly Commodities and explained
that there was a mistake in the dishonor of the check because he
had sufficient funds. Forthwith on the same day, VILLANUEVA called
up the BANKs Legaspi Village Branch Operations Manager, Maritess
Gamboa, and inquired about the dishonor of his well-funded
check. Gamboa promised to look into the matter and instructed
VILLANUEVA to advise his payee, Kingly Commodities, to re-deposit
the check. Gamboa assured VILLANUEVA that the check would be
[5]
honored after the sufficiency of the funds was ascertained.
On 26 June 1986 at about 4:00 p.m., VILLANUEVA learned that his
check was again dishonored due to insufficiency of funds and a stoppayment order he allegedly issued. Dismayed by the turn of events,
VILLANUEVA called up the BANK and inquired from Gamboa the
reason for the dishonor of his well-funded check and the alleged
stop-payment order which he never issued. Gamboa promised to
investigate the matter and to call VILLANUEVA in fifteen (15)
[6]
minutes. In the meantime, she advised VILLANUEVA to re-deposit
the check.
VILLANUEVA then requested Lawrence Chin of Kingly Commodities
to give him until 5:30 p.m. that same day to make good his P50,000
check. He then proceeded to the BANKs Legaspi Village Branch
Office, together with his investment consultant and his trading

partner, to personally inquire into the matter. They were met by

Marilou Genuino, the BANKs Branch Manager. There he complained
that his trading order was rejected because of the dishonor of the
check and that Kingly Commodities threatened to close his trading
account unless his check payment would be made good before 5:30
p.m. that day. After making the necessary investigation, Genuino
related to VILLANUEVA that the reason for the dishonor of the check
was that the account number assigned to his new checkbook was
the account number of another depositor also named Isagani
[7]
Villanueva but with a different middle initial.
To resolve the matter, Genuino promised to send to Kingly
Commodities a managers check for P50,000 before 5:30 p.m., the
deadline given to VILLANUEVA. She also personally called Kingly
Commodities and explained the reason for the dishonor of the
[8]
check.
[9]

On 30 June 1986, VILLANUEVA sent a letter to the BANK addressed

to the President, Jose Facundo, demanding indemnification for
alleged losses and damages suffered by him as a result of the
dishonor of his well-funded check. He demanded the amount
of P70,000 as indemnification for actual damages in the form of lost
profits and P2 Million for moral and other damages.
On 10 July 1986, in answer to VILLANUEVAs letter, Gregorio Anonas
III, the BANKs Senior Vice-President, apologized for the unfortunate
oversight, but reminded VILLANUEVA that the dishonor of his check
was due to his failure to state his current account number in his
requisition slip. Anonas further stated that as soon as the mistake
was discovered, the BANK promptly sent a managers check to Kingly
Commodities before 5:30 p.m. on 26 June 1986 to avoid any damage
[10]
the dishonor of the check might have caused.
Failing to obtain from the BANK a favorable action on his demand
for indemnification, VILLANUEVA filed on 27 August 1986 a
complaint for damages based on breach of contract and/or quasidelict before the Regional Trial Court of Makati City. The case was
docketed as Civil Case No. 14749 and was raffled to Branch 63
thereof.
VILLANUEVA alleged in his complaint that the BANK breached its
contractual obligation to him as a depositor because of its repeated
dishonor of his valid and well-funded check. The breach arose from
the BANKs gross negligence and culpable recklessness in supplying
the wrong account number. As a consequence, he suffered and
sustained (1) actual damages consisting of loss of profits in the
amount of at least P240,000, for he was not allowed to trade by
Kingly Commodities; and (2) P2 Million as moral damages because of
the intolerable physical inconvenience, discomfort, extreme
humiliation, indignities, etc., that he had borne before his peers and
colleagues in the firm, his trading partners, and the officers of Kingly
Commodities. He prayed for an additional award of P500,000 for
exemplary damages, attorneys fees, litigation expenses and costs of
[11]
the suit.
In its answer, the BANK alleged that VILLANUEVA suffered no
actionable injury, much less damages, considering his blatant
irresponsibility in not remembering his current account number and
in failing to bring his checkbook re-order slip form on which his
account number was inscribed when he requested a new set of
checks. His negligence in verifying the account number of the new
set of checks issued to him also contributed to the dishonor of his
check. The BANK claimed that it acted in good faith when it twice
dishonored the check. It further asserted that VILLANUEVAs
negligence was the proximate cause of his self-proclaimed injury;
and the alleged losses and damages could not likewise be deemed
the natural and probable consequences of the BANKs breach of
obligation, had there been any. Finally, it claimed that VILLANUEVA
acted with malice in filing the case, and interposed counterclaims
of P500,000 as exemplary damages; P250,000 as attorneys fees;
[12]
and actual damages as may be determined by the court.
After due proceedings, the trial court rendered on 3 July 1992 a
[13]
decision dismissing the complaint and the compulsory
counterclaim for lack of merit. To the trial court, the basic issue was
whether it was VILLANUEVAs or the BANKs negligence which was

the proximate cause of the formers alleged injury. After an

evaluation of the respective allegations and evidence of the parties,
the trial court found that VILLANUEVAs negligence set the chain of
events which resulted in his alleged losses and damages. His
negligence consisted in his failure to (a) indicate his current account
number when he filled up his requisition slip for a new set of checks;
(b) remember his account number; (c) bring the used checkbook to
which was attached the pre-order requisition slip on which the
account number was pre-indicated; (d) give the requisition slip to
the care and custody of a BANK officer or employee instead of
leaving the requisition slip on top of one of the tables of the BANK;
and (e) verify the account number of the new set of checks when it
was delivered to him. These omissions directly resulted in the
dishonor of his check drawn from an account bearing the account
number of another BANK client whose name and surname were
similar to his. VILLANUEVA then must bear the consequent damages
and losses he allegedly suffered.
The trial court conceded, however, that the BANK was negligent
when it failed to supply VILLANUEVAs correct account number
despite its promise to do so; but its negligence was merely
contributory, which would have reduced the damages recoverable
by VILLANUEVA had the latter proved his claims for actual, moral
and exemplary damages, and attorneys fees.
Likewise, the trial court doubted that VILLANUEVA sustained actual
damages in the amount of P240,000 due to loss of profits as averred
in the complaint considering that his initial claim against the BANK
[14]
for actual loss was merely P70, 000 and the evidence presented in
support thereof was hearsay, unreliable and not the best evidence.
VILLANUEVA appealed to the Court of Appeals. The appeal was
docketed as CA-G.R. CV No. 40931.
In his appeal, VILLANUEVA maintained that the BANK was guilty of
gross or culpable negligence amounting to bad faith when its
customer service representative furnished an erroneous account
number. He further contended that the same was the proximate
cause of the repeated dishonor of his check. He should, therefore,
be entitled to an award of actual, moral and exemplary damages,
including attorneys fees and costs of the suit.
[15]

The Court of Appeals, in its decision of 2 February 1999, ruled that

when the BANK voluntarily processed the requisition slip without
the requisite account number being supplied by the applicant, it in
effect took upon itself the obligation to supply the correct account
number. Thus, when the new checkbook was released to
VILLANUEVA on 17 June 1986, the BANK was deemed to have
waived any defect in the requisition slip and estopped from putting
the blame on VILLANUEVAs failure to indicate his account number.
VILLANUEVA had every right to assume that everything was in order
in his application for a new checkbook; for, after all, he was banking
with a world class universal bank. The banking industry is imbued
with public interest and is mandated by law to serve its clients with
extraordinary care and diligence.
The Court of Appeals also considered the BANKs voluntary
processing of the requisition slip as the cause which in the natural
and continuous sequence, unbroken by any efficient intervening
cause, produced the injury and without which the result would not
[16]
have occurred. However, although it conceded that the BANKs
negligence was not attended with malice and bad faith, it
nonetheless awarded moral damages in the amount of P100,000. It
also awarded attorneys fees in the amount of P50,000, since
VILLANUEVA was compelled to incur expenses to protect his
interests by reason of the unjustified act or omission of the
BANK. However, it rejected VILLANUEVAs claim for compensatory
damages and affirmed the trial courts finding thereon.
[17]

Upon the denial of their respective motions for reconsideration,

both VILLANUEVA and the BANK appealed to us by way of petition
for review.
In its petition, the BANK ascribes to the Court of Appeals as
reversible errors its (1) reversal of the court a quos decision; (2)
declaration that the proximate and efficient cause of the injury

allegedly suffered by VILLANUEVA was the BANKs processing of the

checkbook and assigning an erroneous account number, and not the
negligent act of VILLANUEVA in leaving the checkbook requisition
slip on top of one of the desks with the account number entry blank;
and (3) award of moral damages and attorneys fees despite the
absence of a finding of bad faith on the part of the BANK.
In his petition, VILLANUEVA asserts that the Court of Appeals erred
in holding that his actual losses in the amount of P234,059.04 was
not sufficiently proved with reasonable certainty. Had his fullyfunded check not been dishonored twice, his four trading orders
with Kingly Commodities consisting of two (2) open sell positions on
17 and 18 of June 1986 and two (2) settle buy orders on 26 June
1986 would have earned him profits in the amount he claimed. He
emphatically maintains that the loss had been satisfactorily proved
by the testimony of Helen Chu, his investment consultant. Ms. Chus
testimony was not controverted; hence, it should have been
considered and admitted as factually true. Considering that his
claim for actual damages has been adequately established and that
the BANK committed gross negligence amounting to bad faith, his
concomitant demand for exemplary damages should likewise be
awarded.
The issue of whether VILLANUEVA suffered actual or compensatory
damages in the form of loss of profits is factual. Both the Court of
Appeals and the trial court have ascertained that VILLANUEVA was
unable to prove his demand for compensatory damages arising from
loss. His evidence thereon was found inadequate, uncorroborated,
speculative, hearsay and not the best evidence. Basic is the
jurisprudential principle that 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
[18]
obtainable evidence of the actual amount of the loss. Actual
damages cannot be presumed but must be duly proved with
[19]
reasonable certainty.
It must also be stressed that the unanimity on the factual
ascertainment on this point by the trial court and the Court of
Appeals bars us from supplanting their finding and substituting it
with our own assessment. Well-entrenched in our jurisprudence is
the doctrine that the factual determinations of the lower courts are
conclusive and binding upon appellate courts and hence should not
be disturbed. None of the recognized exceptions to said principle
exists in this case to warrant a reexamination of such
finding. Besides, our jurisdiction in cases brought before us from the
[20]
Court of Appeals is limited to the review of errors of law.
Nonetheless, is VILLANUEVA entitled to the moral damages and
attorneys fees granted by the Court of Appeals?
Moral damages include physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded feelings, moral
[21]
shock, social humiliation, and similar injury. Although incapable of
pecuniary computation, moral damages may be recovered if they
are the proximate result of the defendants wrongful act or
[22]
omission. Thus, case law establishes the requisites for the award
of moral damages, viz: (1) there must be an injury, whether physical,
mental or psychological, clearly sustained by the claimant; (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 of damages
is predicated on any of the cases stated in Article 2219 of the Civil
[23]
Code.
It is beyond cavil that VILLANUEVA had sufficient funds for the
check. Had his account number been correct, the check would not
have been dishonored. Hence, we can say that VILLANUEVAs injury
arose from the dishonor of his well-funded check. We have already
ruled that the dishonor of the check does not entitle him to
compensatory damages. But, could the dishonor result in his alleged
intolerable physical inconvenience and discomfort, extreme
humiliation, indignities, etc, which he had borne before his peers,
trading partners and officers of Kingly Commodities? True, we find
that under the circumstances of this case, VILLANUEVA might have
suffered some form of inconvenience and discomfort as a result of

the dishonor of his check. However, the same could not have been
so grave or intolerable as he attempts to portray or impress upon us.
Further, it is clear from the records that the BANK was able to
remedy the caveat of Kingly Commodities to VILLANUEVA that his
trading account would be closed at 5:30 p.m. on 26 June 1986. The
BANK was able to issue a managers check in favor of Kingly
Commodities before the deadline. It was able to likewise explain to
Kingly Commodities the circumstances surrounding the unfortunate
situation. Verily, the alleged embarrassment or inconvenience
caused to VILLANUEVA as a result of the incident was timely and
adequately contained, corrected, mitigated, if not entirely
eradicated. VILLANUEVA, thus, failed to support his claim for moral
damages. In short, none of the circumstances mentioned in Article
2219 of the Civil Code exists to sanction the award for moral
damages.
The award of attorneys fees should likewise be deleted. The general
rule is that attorneys 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 attorneys fees under Article
2208 of the Civil Code 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
attorneys fees may not be awarded where there is no sufficient
showing of bad faith in the parties persistence of a case other than
[24]
an erroneous conviction of the righteousness of his cause.
In view of the foregoing discussion, we need not deliberate on the
dispute as to whether it was the BANKs or VILLANUEVAs negligence
which was the proximate cause of the latters injury because, in the
first place, he did not sustain any compensable injury. If any
damage had been suffered at all, it could be equivalent to damnum
absque injuria, i.e., damage without injury or damage or injury
inflicted without injustice, or loss or damage without violation of a
legal right, or a wrong done to a man for which the law provides no
[25]
remedy.
WHEREFORE, the decision of the Court of Appeals in CA-G.R. CV No.
40931 is hereby REVERSED, and the judgment of the Regional Trial
Court of Makati City, Branch 63, in Civil Case No. 14749 dismissing
the complaint and the counterclaim is hereby REINSTATED.

At about 1:30 in the morning of March 17, 1960, an Izuzu First Class
passenger bus owned and operated by the defendant, bearing Plate
No. TPU-14871-Bulacan and driven by Laureano Casim, left
Lingayen, Pangasinan, for Manila. Among its paying passengers was
the deceased, Policronio Quintos, Jr. who sat on the first seat,
second row, right side of the bus. At about 4:55 o'clock a.m. when
the vehicle was nearing the northern approach of the Sadsaran
Bridge on the national highway in barrio Sto. Domingo, municipality
of Minalin, Pampanga, it frontally hit the rear side of a bullcart filled
with hay. As a result the end of a bamboo pole placed on top of the
hayload and tied to the cart to hold it in place, hit the right side of
the windshield of the bus. The protruding end of the bamboo pole,
about 8 feet long from the rear of the bullcart, penetrated through
the glass windshield and landed on the face of Policronio Quintos, Jr.
who, because of the impact, fell from his seat and was sprawled on
the floor. The pole landed on his left eye and the bone of the left
side of his face was fractured. He suffered other multiple wounds
and was rendered unconscious due, among other causes to severe
cerebral concussion. A La Mallorca passenger bus going in the
opposite direction towards San Fernando, Pampanga, reached the
scene of the mishap and it was stopped by Patrolman Felino Bacani
of the municipal police force of Minalin who, in the meantime, had
gone to the scene to investigate. Patrolman Bacani placed Policronio
Quintos, Jr. and three other injured men who rode on the bullcart
aboard the La Mallorca bus and brought them to the provincial
hospital of Pampanga at San Fernando for medical assistance.
Notwithstanding such assistance, Policronio Quintos, Jr. died at 3:15
p.m. on the same day, March 17, 1960, due to traumatic shock due
to cerebral injuries.
The private respondents, Trinidad, Prima and Julita, all surnamed
Quintos, are the sisters and only surviving heirs of Policronio Quintos
Jr., who died single, leaving no descendants nor ascendants. Said
respondents herein brought this action against herein petitioner,
Villa Rey Transit, Inc., as owner and operator of said passenger bus,
bearing Plate No. TPU-14871-Bulacan, for breach of the contract of
carriage between said petitioner and the deceased Policronio
Quintos, Jr., to recover the aggregate sum of P63,750.00 as
damages, including attorney's fees. Said petitioner defendant in
the court of first instance contended that the mishap was due to
a fortuitous event, but this pretense was rejected by the trial court
and the Court of Appeals, both of which found that the accident and
the death of Policronio had been due to the negligence of the bus
driver, for whom petitioner was liable under its contract of carriage
with the deceased. In the language of His Honor, the trial Judge:

No costs.
SO ORDERED.
Puno, Kapunan, Pardo, and Ynares-Santiago, JJ., concur.
EN BANC

The mishap was not the result of any unforeseeable fortuitous event
or emergency but was the direct result of the negligence of the
driver of the defendant. The defendant must, therefore, respond for
damages resulting from its breach of contract for carriage. As the
complaint alleged a total damage of only P63,750.00 although as
elsewhere shown in this decision the damages for wake and burial
expenses, loss of income, death of the victim, and attorneys fee
reach the aggregate of P79,615.95, this Court finds it just that said
damages be assessed at total of only P63,750.00 as prayed for in
plaintiffs' amended complaint.

G.R. No. L-25499 February 18, 1970

The despositive part of the decision of the trial Court reads:
VILLA
REY
TRANSIT,
INC., petitioner,
vs.
THE COURT OF APPEALS, TRINIDAD A. QUINTOS, PRIMA A.
QUINTOS, AND JULITA A. QUINTOS,respondents.

WHEREFORE, judgment is hereby rendered ordering the defendant

to pay to the plaintiffs the amount of P63,750.00 as damages for
breach of contract of carriage resulting from the death of Policronio
Quintos, Jr.

Laurea and Pison for petitioner.

Bonifacio M. Abad, Jr. for respondents.

CONCEPCION, C.J.:
Petitioner, Villa Rey Transit, Inc., seeks the review by certiorari of a
decision of the Court of Appeals affirming that of the Court of First
Instance of Pangasinan. The basic facts are set forth in said decision
of the Court of Appeals, from which We quote:

which, as above indicated, was affirmed by the Court of Appeals.

Hence, the present petition for review on certiorari, filed by Villa Rey
Transit, Inc.
The only issue raised in this appeal is the amount of damages
recoverable by private respondents herein. The determination of
such amount depends, mainly upon two (2) factors, namely: (1) the
number of years on the basis of which the damages shall be
computed and (2) the rate at which the losses sustained by said
respondents should be fixed.

The first factor was based by the trial court the view of which was
concurred in by the Court of Appeals upon the life expectancy of
Policronio Quintos, Jr., which was placed at 33-1/3 years he being
over 29 years of age (or around 30 years for purposes of
computation) at the time of his demise by applying the formula
(2/3 x [80-301 = life expectancy) adopted in the American
Expectancy Table of Mortality or the actuarial of Combined
Experience Table of Mortality. Upon the other hand, petitioner
maintains that the lower courts had erred in adopting said formula
1
and in not acting in accordance with Alcantara v. Surro in which the
damages were computed on a four (4) year basis, despite the fact
that the victim therein was 39 years old, at the time of his death,
and had a life expectancy of 28.90 years.
The case cited is not, however, controlling in the one at bar. In the
Alcantara case, none of the parties had questioned the propriety of
the four-year basis adopted by the trial court in making its award of
damages. Both parties appealed, but only as regards
the amount thereof. The plaintiffs assailed the non-inclusion, in its
computation, of the bonus that the corporation, which was the
victim's employer, had awarded to deserving officers and
employees, based upon the profits earned less than two (2) months
before the accident that resulted in his death. The defendants, in
turn, objected to the sum awarded for the fourth year, which was
treble that of the previous years, based upon the increases given, in
that fourth year, to other employees of the same corporation.
Neither this objection nor said claim for inclusion of the bonus was
sustained by this Court. Accordingly, the same had not thereby laid
down any rule on the length of time to be used in the computation
of damages. On the contrary, it declared:
The determination of the indemnity to be awarded to the heirs of a
deceased person has therefore no fixed basis. Much is left to the
discretion of the court considering the moral and material damages
involved, and so it has been said that "(t)here can be no exact or
uniform rule for measuring the value of a human life and the
measure of damages cannot be arrived at by precise mathematical
calculation, but the amount recoverable depends on the particular
facts and circumstances of each case. The life expectancy of the
deceased or of the beneficiary, whichever is shorter, is an important
factor.' (25 C.J.S. 1241.) Other factors that are usually considered
are: (1) pecuniary loss to plaintiff or beneficiary (25 C.J.S. 1243-1250)
; (2) loss of support (25 C.J.S., 1250-1251); (3) loss of service (25
C.J.S. 1251-1254); (4) loss of society (25 C.J.S. 1254-1255); (5) mental
suffering of beneficiaries (25 C.J.S., 1258-1259) ; and (6) medical and
2
funeral expenses (26 C.J.S., 1254-1260)."
Thus, life expectancy is, not only relevant, but, also,
an important element in fixing the amount recoverable by private
respondents herein. Although it is not the sole element
determinative of said amount, no cogent reason has been given to
warrant its disregard and the adoption, in the case at bar, of a purely
arbitrary standard, such as a four-year rule. In short, the Court of
Appeals has not erred in basing the computation of petitioner's
liability upon the life expectancy of Policronio Quintos, Jr.
With respect to the rate at which the damages shall be computed,
petitioner impugns the decision appealed from upon the ground
that the damages awarded therein will have to be paid now,
whereas most of those sought to be indemnified will be
suffered years later. This argument is basically true, and this is,
perhaps, one of the reasons why the Alcantara case points out the
absence of a "fixed basis" for the ascertainment of the damages
recoverable in litigations like the one at bar. Just the same, the force
of the said argument of petitioner herein is offset by the fact that,
although payment of the award in the case at bar will have to take
place upon the finality of the decision therein, the liability of
petitioner herein had been fixed at the rate only of P2,184.00 a year,
which is the annual salary of Policronio Quintos, Jr. at the time of his
death, as a young "training assistant" in the Bacnotan Cement
Industries, Inc. In other words, unlike the Alcantara case, on which
petitioner relies, the lower courts did not consider, in the present
case, Policronio's potentiality and capacity to increase his future
income. Indeed, upon the conclusion of his training period, he was
supposed to have a better job and be promoted from time to time,
and, hence, to earn more, if not considering the growing
importance of trade, commerce and industry and the concomitant

rise in the income

therein much more.

level

of

officers

and

employees

At this juncture, it should be noted, also, that We are mainly

concerned with the determination of the losses or damages
sustained by the private respondents, as dependents and intestate
heirs of the deceased, and that said damages consist, not of the full
amount of his earnings, but of the support, they received or would
have received from him had he not died in consequence of the
negligence of petitioner's agent. In fixing the amount of that
support, We must reckon with the "necessary expenses of his own
living", which should be deducted from his earnings. Thus, it has
been consistently held that earning capacity, as an element of
damages to one's estate for his death by wrongful act is necessarily
his net earning capacity or his capacity to acquire money, "less the
3
necessary expense for his own living. Stated otherwise, the amount
recoverable is not loss of the entire earning, but rather the loss of
that portion of the earnings which the beneficiary would have
4
received. In other words, only net earnings, not gross earning, are
5
to be considered that is, the total of the earnings less expenses
6
necessary in the creation of such earnings or income and less living
7
and other incidental expenses.
All things considered, We are of the opinion that it is fair and
reasonable to fix the deductible living and other expenses of the
deceased at the sum of P1,184.00 a year, or about P100.00 a month,
and that, consequently, the loss sustained by his sisters may be
roughly estimated at P1,000.00 a year or P33,333.33 for the 33-1/3
years of his life expectancy. To this sum of P33,333.33, the following
should be added: (a) P12,000.00, pursuant to Arts. 104 and 107 of
the Revised Penal Code, in relation to Article 2206 of our Civil Code,
8
as construed and applied by this Court; (b) P1,727.95, actually spent
by private respondents for medical and burial expenses; and (c)
attorney's fee, which was fixed by the trial court, at P500.00, but
which, in view of the appeal taken by petitioner herein, first to the
Court of Appeals and later to this Supreme Court, should be
increased to P2,500.00. In other words, the amount adjudged in the
decision appealed from should be reduced to the aggregate sum of
P49,561.28, with interest thereon, at the legal rate, from December
29, 1961, date of the promulgation of the decision of the trial court.
Thus modified, said decision and that of the Court of Appeals are
hereby affirmed, in all other respects, with costs against petitioner,
Villa Rey Transit, Inc. It is so ordered.
Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Fernando,
Teehankee, Barredo and Villamor, JJ., concur.

FIRST DIVISION
[G.R. Nos. 129292-93. June 20, 2001]
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. ARLENGEN
DEGALA, accused-appellant.
DECISION
PUNO, J.:
Accused-appellant ARLENGEN DEGALA seeks to reverse the
judgment in Criminal Case Nos. 916 and 917 of the Regional Trial
Court (Branch XXV) of Koronadal, South Cotabato, finding him guilty
as charged of two (2) counts of rape committed in March 1988 and
[1]
December 6, 1992. The complainant is his minor daughter, HAILYN
DEGALA.
When arraigned, the accused pled not guilty to both crimes.

[2]

The records show that the complainant, Hailyn Degala, is the second
child in a brood of six children of spouses Heidi Degala and accused
[3]
Arlengen Degala. She was born on August 3, 1977. Her siblings are
[4]
Arnel, Helen, Harlyn, Arnold and Arlengen, Jr.

The Degalas used to live in Tubing, Tupi, South Cotabato. On school

days, the complainant, Hailyn, and her siblings stayed in the house
of their maternal grandparents in Martinez Subdivision, Marbel,
Koronadal, South Cotabato. They went home on weekends or when
they did not have classes.
In the evening of March 1988, Hailyn and her younger sisters were in
their house in Tubing. They slept in one room at the ground
floor. The accused slept outside their room near the door. Hailyns
paternal grandparents were in another house, about a meter away
from their place. At that time, Hailyns mother was in Koronadal
where she worked as a laundry woman.
Later that night, the accused broke into the room where Hailyn was
sleeping. He was wearing only his brief. He crept towards
Hailyn. He lifted her T-shirt and touched her body. He mashed her
left breast. She resisted and they wrestled. He succeeded in lifting
her skirt and taking off her panty. He started to caress her and kiss
her on the face, neck and lips. She then kicked his feet and
desperately reached out for her sisters who were sleeping beside
her. Unfortunately, she failed to awake them. Finally, the accused
succeeded in having carnal knowledge of her. She asked the
accused: Why are you doing this to me? He replied that she was
sweet. After satisfying his lust, he rushed out of the room. It was
Hailyns first sexual contact. The experience was painful. She was
10 years and 7 months old.

tried to talk to Helen but she failed because Heidi sent Helen to
work in Davao.
Nelida testified that when Hailyn was still in the custody of her
parents, the accused would often beat her up. The beatings only
stopped after December 6, 1992 because she ceased living with
them.
The defense was anchored on denial. The accused presented Heidi,
his mother (Julieta), his mother-in-law (Magdalena Dariaga), and
Harlyn as witnesses. They testified that Hailyn was a disrespectful
and stubborn child. Allegedly, in the evening of December 6, 1992,
Magdalena Dariaga caught Hailyn and her boyfriend having sexual
intercourse inside their toilet located in their backyard. The toilet
had no roof, its four sides were covered with sacks: three served as
walls while one served as its door. The earth served as its
floor. Magdalena claimed she saw Hailyns boyfriend on top of
her. She stood by the makeshift door for two minutes and was not
noticed by them. She did not stop the two but waited for them to
come out from the toilet. She then scolded them.
The next day, Magdalena allegedly went to Tubing and informed
Hailyns parents about her indiscretion. They went to Marbel and
there, the accused beat up Hailyn in the presence of Heidi, Helen
and Harlyn. He used his leather belt and later a branch of ipil-ipil in
hitting her.

She wept the whole night until morning. Her sisters woke up and
left the room, but did not see her crying because she was lying face
down. She kept herself in the room the whole day crying. Nobody
was able to talk to her that day because the accused shouted at her
[5]
siblings when they tried to enter her room.

The defense charged that Hailyn carried a grudge against the

accused for the constant beatings she received from him. Thus, to
spite him, she falsely accused him of raping her. The defense
witnesses claimed that the rape could not take place in Tubing
because they always slept in one room.

The rape was repeated several times for four years. Hailyn
estimated that she was abused twenty (20) times. Her last sexual
molestation happened on December 6, 1992. On that day, the
accused directed her siblings to go to the house of their paternal
grandparents and ordered her to stay behind. Again, he forced
himself on Hailyn. He boxed her in the epigastric region and violated
her.

As for the rape cases filed by Harlyn, the latter denied that the
accused raped her. Allegedly, Nelida threatened them that they
would go to prison if they refused to charge the accused in court.

On December 10, 1992, Hailyn learned from her mother (Heidi) that
the accused tried to rape her aunt, Nora Ronquillo. The information
enraged her and she finally revealed to her mother that the accused
had raped her. Her mother then asked her other daughters (Helen
and Harlyn) if the accused also raped them. They made the same
revelations. The accused laughed off the charges upon
confrontation. He eventually left their house when Hailyns mother
threatened him that she would call the police.
Nelida Ladrillo, a younger sister of Heidi, happened to drop by her
sisters house in Marbel. She sensed that something wrong had
happened when she talked to Hailyn and her sisters. The three girls
were sad. They admitted the rapes to Nelida. Hailyn requested
Nelida to accompany them to a doctor.
On December 14, 1992, Dr. Apolinar Hatulan of the Municipal Health
Office of Tupi examined Hailyn and her sisters. He found healed
lacerations on Hailyns genitalia at 12, 3, 5 and 7 oclock positions,
[6]
indicating the possibility of her sexual molestation. He also
confirmed the possible sexual abuses on her sisters. Nelida then
brought the three girls to Tupi Police Station where Hailyn executed
her sworn statement accusing their father of raping them on
separate occasions from 1988 to 1992.
When Nelida finally had the chance to talk to Heidi, she reported
that the medical test results confirmed the girls accusations of
rape. Heidi refused to believe her and insisted that Hailyn could
have made up the story. As Heidi was disinterested to prosecute the
accused, Nelida assisted Hailyn and her sisters in filing the rape
cases against him. Helens complaint was docketed as Criminal Case
Nos. 913-914, Harlyns, Criminal Case No. 915 and Hailyns, Criminal
Case Nos. 916-917. Of the three girls, only Hailyn did not desist from
prosecuting the accused. Nelida went to Harlyns school and talked
to her niece about the case. The latter refused to continue with its
prosecution because Heidi would not let her go to court. Nelida also

To further discredit Nelida, the defense alleged that Nelidas

husband had a fistfight with the accused on one occasion, in
connection with the expenses incurred during the wake of a
relative. Since then, Nelida allegedly bore a grudge against him and
to get even, she forced the three girls to charge him.
After trial, the court a quo found the accused guilty of two counts of
[7]
rape. He was sentenced in each case to suffer the penalty
of reclusion perpetua and ordered to pay a total of P100,000.00 as
civil indemnity by way of moral damages.
Hence, this appeal.
The only issue posed is whether or not the accused-appellants guilt
was established beyond reasonable ground.
In rape cases, the lone testimony of the victim, if credible, is
[8]
sufficient to sustain a conviction. It is a settled rule that when the
issue focuses on the credibility of witnesses, or the lack of it, the
assessment of the trial court should be controlling, unless cogent
reasons, and none exists in this case, dictate otherwise.
After a study of the evidence, we are convinced that Hailyn narrated
the truth in court. Her testimony is full of details and
straightforward. As rightly ruled by the trial court, it can come only
from one who has truly and personally undergone the agonizing
events. We also note that there were instances when Hailyn was
ashamed to narrate her ordeal in court, an indication of a sense of
loss of self-pride because of what she had gone through. She
[9]
testified as follows:
PROSECUTOR LECHONSITO:
Q: How did your father rape you, please tell the Court.
A: He entered the room, sir.

Q: And then what happened?

A: He removed my panty, sir.

A: Then (he) creeped (sic) towards me, then he touched my body

and pointed a gun to my head.

Q: And then?
A: We wrestled with each other.

x x x
Q: How did you wrestle with each other.
Q: You said that your father approached you by creeping. How did
you know that he approached you by creeping, please tell the Court.

A: He laid on me.

A: Because I was able to notice.

Q: What kind of dress were you wearing during that time?

Q: So that because you noticed it, you were not yet sleeping at
that time, is that correct?

A: I was wearing a skirt and a t-shirt.

A: I was already asleep, but I noticed when he crept towards me.

Q: And then after he crept towards you, what happened?
A: He pointed a gun at my head (witness pointing at the left
temple) and he undressed me by removing my panty.
COURT:

Q: When he removed your panty, did he remove also your skirt?

A: No, sir.
Q: What did he do with your skirt?
A: He raised my skirt upwards, sir.
Q: How about your shirt, what did he do with your shirt?

Hailyn, do not be embarrassed, when you testify. If you like,

we can have the other people sent outside the courtroom.

A: He did not remove it.

WITNESS:

Q: You said that after your father removed your panty, he laid on
top of you. What did he do when he laid on top of you?

I would like the audience to move out.

COURT:
Those who are not concerned, please step out.
PROSECUTOR LECHONSITO:
Q: You said that when your father approach (sic) you creeping, he
touched you body. Did I get you right when you testified on that a
while ago?
A: Yes, sir.
Q: What part of your body was touched by your father?
A: He touched my breast, sir.
Q: How did he touch your breast, tell the Court.
A: He mashed my breast.
Q: You were wearing clothes during that time:
A: Yes, sir.
xxx
PROSECUTOR LECHONSITO:
Q: How did he mash your breast, please tell the Court.
A: He placed his hands under my dress and then he mashed my
breast.
Q: What side of your breast was mashed by your father?
A: My left breast, sir.
Q: After he mashed you left breast, what else did he do?

A: He caressed me.
Q: How did he caress you?
A: He kissed me, sir, on my face and on my lips.
Q: When your father was doing that to you, what was your
reaction, if any?
A: I was struggling, sir.
Q: How did you struggle?
A: I struggled by kicking him.
Q: Did you kick your father?
A: Yes, sir.
xxx
Q: You said that your father caressed you by kissing your face and
your lips and what else (sic) did he kiss in you, aside from those:
A: My neck, sir.
Q: What else?
A: No more, sir.
Q: What else did he do, after kissing you?
A: He touched my vagina, sir.
Q: How did he touch your vagina?
A: He mashed my vagina.
PROSECUTOR LECHONSITO:

Will I be allowed to talk to the witness?

ATTY. SUNGA: (sic)

Sustained.
WITNESS:

Atty. Sunga, please come forward.

I cried.

COURT:

xxx

Prosecutor advised the witness not to be ashamed in

testifying. The advice was made in the presence of counsel for the
accused. Proceed.

Q: In your estimate, how long did it take him to let his penis enter
into your vagina?
A: It took a long time.

PROSECUTOR LECHONSITO:
Q: When your father mashed your vagina, was your panty still on?

Q: And in the process, what did you feel while he was letting his
penis enter into your vagina?

A: No more, sir.

A: It was painful, sir.

Q: When he mashed your vagina, what else did he do after

mashing your vagina?

xxx
Q: Did you tell your father not to do that to you?

A: He let his penis touched (sic) my vagina.

A: I told him, Why are you doing this to me?
Q: How long did he touch your vagina?
Q: What was his response to you?
A: For a short time, sir.
Q: You said that after mashing your vagina for a short time, he let
his penis touch your vagina, how long did he let his penis touch your
vagina?
A: For a long time, sir.

A: He told me, Dont tell this to your mother or to others or else, I

will kill you.
Q: What else did you talk about?
A: I told him, There is my mother. Why are you doing it to me
when in fact, I am your daughter.

Q: What was he doing with his penis?

Q: What was his answer?
A: He was inserting his penis into my vagina.
A: He told me that I am sweet.
Q: How did he insert his penis towards your vagina?
x x x.
A: He spread my legs.
Q: How did he spread your legs?
A: He held both my legs and spread them, sir.
Q: By the way, when your father approached you by creeping
towards your, what was he wearing, if you could recall?
A: He was wearing a brief and he was naked on the other part of
his body.
xxx
PROSECUTOR LECHONSITO:
Q: What did you feel when his penis entered your vagina?
A: It was painful, sir.
Q: Because it was painful, what did you do?

We do not believe that Hailyn would accuse her father of rape to

spite him for the beatings she received from him when she was still
in his custody. Even with these alleged beatings, it would take a
most senseless kind of depravity for a young daughter to concoct a
story against her father, accusing him of beastly conduct that would
put him for most of his remaining life in jail and expose herself and
[10]
her family to public humiliation. Hailyn was only ten years old at
the time of the first sexual molestation.
The accused-appellant claims that the place where he allegedly
raped Hailyn was too cramped. Allegedly, it was impossible for him
to rape her because they slept in one room with the other members
of their household. The argument that rape cannot be committed in
a room shared with other members of the family has long been
[11]
rejected by this Court, lust being no respecter of time and place.
Next, accused-appellant banks on the delayed filing of the rape
cases against him. The rule is that delay in reporting the offense of
incestuous rape is not necessarily an indication that the charge is
fabricated. It does not diminish the complainants credibility nor
undermine the charges of rape where the delay can be attributed to
the pattern of fear instilled by the threats of bodily harm, specially
[12]
by one who exercises moral ascendancy over the victim.

A: Nothing, sir.
Q: Did you not cry because of the pain?
ATTY. SUNGA:
We object.
COURT:

In the cases at bar, it is understandable why it took a long time for

Hailyn to reveal to her mother that she was sexually molested by
accused-appellant. She was very young. She grew up being beaten
up by him. He had threatened her with harm should she tell anyone
about the rapes. Obviously, fear cowed her to silence and inaction.
The accused-appellants mere denial that he raped Hailyn will not
exonerate him. Denial cannot prevail over the positive and candid

testimony of the victim whose credibility was not eroded. No young

girl would concoct a story of sexual assault, undergo gynecologic
examination and subject herself to the trauma and embarrassment
[13]
of criminal prosecution unless she speaks the truth.
The defenses story that Hailyn was caught by her grandmother
having sexual intercourse with her boyfriend is incredible. We agree
[14]
with the trial courts observation, thus:
Even the allegation of sexual intercourse between complainant
Hailyn Degala and her supposed boyfriend which per the defense is
the reason why Hailyn Degala was beaten by her father taxes our
mind into disbelief. The toilet where the sex act was performed was
square-shaped structure, two arms length wide. There was no door
which could be secured, only a piece of sack serving as curtain would
hide the person attending to his biological needs inside. The walling
was also made of sack. There was no roof. The boyfriend was
supposed to be five feet and five inches tall. Verily, if the two sex
partners would lie on the floor, as what complainant and Marlon
did, and with a toilet bowl and other articles such as pail for water
inside, the lovers would be in a cramped position. Being lovers, why
would the two choose of all places a ramshackle toilet to do their
thing.
We add that it is implausible that Hailyns grandmother would just
stand by the sack door of the toilet for two minutes while her
granddaughter was having sex with her boyfriend. Common human
experience dictates that such a scandalous conduct would have
prompted her to call Hailyns attention right away and not wait for
the alleged young lovers to consummate their lustful act. Evidence
to be believed must not only proceed from the mouth of a credible
[15]
witness but must foremost be credible in itself.
The accused-appellant also alleges that Hailyns maternal aunt,
Nelida Ladrillo, induced her and her sisters to file a complaint
against him. The reason given was the alleged misunderstanding
between him and Nelidas husband. The allegation does not merit
serious consideration especially when viewed against the fact that
when Hailyn and her sisters were examined by the doctor, all three
medical results showed signs that they were sexually molested.
All told, we agree with the judgment of the trial court that the
accused-appellant is liable for two counts of rape. At the time the
rape incidents were committed, Republic Act Nos. 7659 and 8353
were not yet in effect. Thus, he was correctly sentenced to suffer
[16]
the penalty of reclusion perpetua.
As regards the damages, the trial court awarded in favor of the
complainant the amount of P50,000.00 in each case as civil
indemnity by way of moral damages. We reiterate that civil
indemnity is distinct from moral damages and the two are awarded
[17]
separately from each other. Civil indemnity is mandatory upon
the finding of the fact of rape. In the case of People vs.
[18]
Victor, we reemphasized the difference of the two awards, thus:

Accordingly, the damages awarded by the trial court must be

[20]
modified. Accused-appellant should be held liable to pay the
complainant P50,000.00 as civil indemnity and another P50,0000.00
[21]
as moral damages in each rape case. In addition, accusedappellant should be held liable for exemplary damages in accord
[22]
with our ruling in People vs. Antipona. We held therein that
when a man perpetrates his lascivious designs on his own direct
blood relative, he descends to a level lower than beasts. Exemplary
damages is thus awarded to deter other fathers with perverse
tendencies or aberrant sexual behavior from abusing their own
[23]
daughters.
IN VIEW WHEREOF, the decision of the Regional Trial Court of
Koronadal, South Cotabato, Branch 25, in Criminal Case Nos. 916
and 917 is AFFIRMED, with the modification that accused-appellant
Arlengen Degala is ordered to pay complainant Hailyn Degala, in
each criminal case, the amount of P50,000.00 as civil
indemnity, P50,000 as moral damages and P50,000.00 as exemplary
damages. Costs against accused-appellant.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Kapunan, Pardo, and Ynares-Santiago,
JJ., concur.
QUEZON CITY GOVT vs DACARA
DECISION

PANGANIBAN, J.
T he review of cases under Rule 45 of the Rules of Court is limited
to errors of law. Unless there is a showing that the findings of the
lower court are totally devoid of support or are glaringly erroneous,
this Court will not analyze or weigh evidence all over again. Under
the circumstance, the factual findings and conclusions of the Court
of Appeals affirming those of the trial courts will be conclusive upon
the Supreme Court. Furthermore, well-entrenched is the rule that
points of law, theories, issues and arguments not brought to the
attention of the trial court cannot be raised for the first time on
appeal or certiorari. Finally, this Court reiterates the principle that
moral damages are designed to compensate the claimant for actual
injury suffered, not to impose a penalty on the wrongdoer. Hence,
absent any definite finding as to what they consist of, the alleged
moral damages suffered would become a penalty rather than a
compensation for actual injury suffered.
The Case
[1]

The lower court, however, erred in categorizing the award

of P50,000.00 to the offended party as being in the nature of moral
damages. We have heretofore explained in People vs. Gementiza
that the indemnity authorized by our criminal law as civil
indemnity ex delicto for the offended party, in the amount
authorized by the prevailing judicial policy and aside from other
proven actual damages, is itself equivalent to actual or
compensatory damages in civil law. It is not to be considered as
moral damages thereunder, the latter being based on different jural
foundations and assessed by the court in the exercise of sound
discretion.
[19]

In People vs. Prades, we also resolved that moral damages may

be awarded to the rape victim, in such amount as the Court deems
just, without the need for pleading or proof of the basis
thereof. The conventional requirement of allegata et probata in
civil procedure and for essentially civil cases was 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.

Before us is a Petition for Review under Rule 45 of the Rules of

[2]
Court, assailing the February 21, 2001 Decision and the October 9,
[3]
2001 Resolution of the Court of Appeals (CA) in CA-GR CV No.
29392. The challenged Decision disposed as follows:
WHEREFORE, premises considered, the Decision dated June 29,
1990 in Civil Case No. Q-88-233 should be AFFIRMED, with costs
[4]
against the appellants.
The assailed Resolution
Reconsideration.

denied

petitioners

Motion

for

The Facts
The CA summarized the facts in this manner
Sometime on February 28, 1988 at about 1:00 A.M., Fulgencio
Dacara, Jr., son of Fulgencio P. Dacara, Sr. and owner of 87 Toyota
Corolla 4-door Sedan with Plate No. 877 (sic), while driving the said
vehicle, rammed into a pile of earth/street diggings found at
Matahimik St., Quezon City, which was then being repaired by the

Quezon City government. As a result, Dacarra (sic), Jr. allegedly

sustained bodily injuries and the vehicle suffered extensive damage
for it turned turtle when it hit the pile of earth.
Indemnification was sought from the city government (Record, p.
22), which however, yielded negative results. Consequently,
Fulgencio P. Dacara (hereinafter referred to as FULGENCIO), for and
in behalf of his minor son, Jr., filed a Complaint (Record, p. 1) for
damages against the Quezon City and Engr. Ramir Tiamzon, as
defendants, before the Regional Trial Court, National Capital Judicial
Region, Branch 101, Quezon City, docketed as Civil Case No. Q-88233. FULGENCIO prayed that the amount of not less
than P20,000.00 actual or compensatory damages, P150,000.00
moral damages, P30,000.00 exemplary damages, and P20,000.00
attorneys fees and costs of the suit be awarded to him.

In an Answer with Affirmative and/or Special Defenses

(Record, p. 11), defendants admitted the occurrence of the incident
but alleged that the subject diggings was provided with a moun[d] of
soil and barricaded with reflectorized traffic paint with sticks placed
before or after it which was visible during the incident on February
28, 1988 at 1:00 A.M. In short, defendants claimed that they
exercised due care by providing the area of the diggings all
necessary measures to avoid accident. Hence, the reason why
Fulgencio Dacara, Jr. fell into the diggings was precisely because of
[5]
the latters negligence and failure to exercise due care.
After trial on the merits, the Regional Trial Court (RTC), Branch
[6]
101, Quezon City, rendered its Decision dated June 29, 1990. The
evidence proffered by the complainant (herein respondent) was
found to be sufficient proof of the negligence of herein
[7]
petitioners. Under Article 2189 of the Civil Code, the latter were
held liable as follows:
WHEREFORE, premises above considered, based on the
quantum of evidence presented by the plaintiff which tilts in their
favor elucidating the negligent acts of the city government together
with its employees when considered in the light of Article 2189,
judgment is hereby rendered ordering the defendants to indemnify
the plaintiff the sum of twenty thousand pesos as
actual/compensatory
damages, P10,000.00
as
moral
damages, P5,000.00 as exemplary damages,P10,000.00 as attorneys
[8]
fees and other costs of suit.
In their appeal to the CA, petitioners maintained that they had
observed due diligence and care in installing preventive warning
devices, and that it was in fact the plaintiff who had failed to
exercise prudence by driving too fast to avoid the diggings.
Moreover, the lower court allegedly erred in using Article 2189 of
the Civil Code, which supposedly applied only to liability for the
death or injuries suffered by a person, not for damage to property.
Ruling of the Court of Appeals
The CA agreed with the RTCs finding that petitioners negligence
was the proximate cause of the damage suffered by
[9]
respondent. Noting the failure of petitioners to present evidence
to support their contention that precautionary measures had
indeed been observed, it ruled thus:
x x x. Sadly, the evidence indicates that [petitioners] failed to show
that they placed sufficient and adequate precautionary signs at
Matahimik Street to minimize or prevent the dangers to life and
limb under the circumstances. Contrary to the testimony of the
witnesses for the [petitioners], namely Engr. Ramir Tiamzon, Ernesto
Landrito and Eduardo Castillo, that there were signs, gasera which
was buried so that its light could not be blown off by the wind and
barricade, none was ever presented to stress and prove the
[10]
sufficiency and adequacy of said contention.
Further upholding the trial courts finding of negligence on the
part of herein petitioners, the CA gave this opinion:

x x x. As observed by the trial court, the negligence of *petitioners+

was clear based on the investigation report of Pfc. William P.
Villafranca stating to the effect that the subject vehicle rammed
into a pile of earth from a deep excavation thereat without any
warning devi[c]e whatsoever and as a consequence thereof, Dacara,
Jr. lost control of his driven car and finally turned-turtle causing
substantial damage to the same. As a defense against liability on
the basis of quasi-delict, one must have exercised the diligence of a
good father of a family which [petitioners] failed to establish in the
[11]
instant case.
Whether Article 2189 is applicable to cases in which there has been
no death or physical injury, the CA ruled in the affirmative:
x x x. More importantly, we find it illogical to limit the liability to
death or personal injury only as argued by appellants in the case at
bar applying the foregoing provisions. For, injury is an act that
damages, harms or hurts and mean in common as the act or result
of inflicting on a person or thing something that causes loss, pain,
distress, or impairment. Injury is the most comprehensive, applying
to an act or result involving an impairment or destruction of right,
[12]
health, freedom, soundness, or loss of something of value.
Hence, this Petition.

[13]

Issues Petitioners raise the following issues for our consideration:

1. The Honorable Court of Appeals decided a question of
law/substance contrary to applicable law and jurisprudence when it
affirmed the award of moral damage suit (sic) the amount
of P10,000.00.
2. The Honorable Court of Appeals decided a question of
law/substance contrary to applicable law and jurisprudence when it
affirmed the award of exemplary damage sin (sic) the amount
of P5,000.00 and attorneys fee in the *a+mount of P10,000.00.
3. The Honorable Court of Appeals gravely erred and/;or (sic) had
acted with grave abuse of discretion amounting to lack and/or
excess of jurisdiction when it refused to hold that respondents son
in the person of Fulgencio Dacara, Jr. was negligent at the time of
[14]
incident.
Because the issues regarding the liability of petitioners for
moral and exemplary damages presuppose that their negligence
caused the vehicular accident, we first resolve the question of
negligence or the proximate cause of the incident.
The Courts Ruling The Petition is partly meritorious.
First Issue:NegligenceMaintaining that they were not negligent,
petitioners insist that they placed all the necessary precautionary
signs to alert the public of a roadside construction. They argue that
the driver (Fulgencio Dacara Jr.) of respondents car was
overspeeding, and that his own negligence was therefore the sole
cause of the incident.Proximate cause is defined as any cause that
produces injury in a natural and continuous sequence, unbroken by
any efficient intervening cause, such that the result would not have
[15]
occurred otherwise.
Proximate cause is determined from the
facts of each case, upon a combined consideration of logic, common
[16]
sense, policy and precedent.
What really caused the subject vehicle to turn turtle is a factual
issue that this Court cannot pass upon, absent any whimsical or
capricious exercise of judgment by the lower courts or an ample
[17]
showing that they lacked any basis for their conclusions. The
unanimity of the CA and the trial court in their factual ascertainment
that petitioners negligence was the proximate cause of the accident
bars us from supplanting their findings and substituting these with
our own. The function of this Court is limited to the review of the
appellate courts alleged errors of law. It is not required to weigh all
over again the factual evidence already considered in the
[18]
proceedings below.
Petitioners have not shown that they are
[19]
entitled to an exception to this rule.
They have not sufficiently
demonstrated any special circumstances to justify a factual review.

That the negligence of petitioners was the proximate cause of the

accident was aptly discussed in the lower courts finding, which we
quote:
Facts obtaining in this case are crystal clear that the
accident of February 28, 1988 which caused almost the life and limb
of Fulgencio Dacara, Jr. when his car turned turtle was the existence
of a pile of earth from a digging done relative to the base failure at
Matahimik Street nary a lighting device or a reflectorized barricade
or sign perhaps which could have served as an adequate warning to
motorist especially during the thick of the night where darkness is
pervasive.
Contrary to the testimony of the witnesses for the
defense that there were signs, gasera which was buried so that its
light could not be blown off by the wind and barricade, none was
ever presented to stress the point that sufficient and adequate
precautionary signs were placed at Matahimik Street. If indeed signs
were placed thereat, how then could it be explained that according
to the report even of the policeman which for clarity is quoted
again, none was found at the scene of the accident.
xxx

xxx

xxx

Negligence of a person whether natural or juridical over a

particular set of events is transfixed by the attending circumstances
so that the greater the danger known or reasonably anticipated, the
greater is the degree of care required to be observed.
xxx

xxx

Petitioners argue that moral damages are recoverable only in the

[26]
instances specified in Article 2219 of the Civil Code. Although the
instant case is an action for quasi-delict, petitioners contend that
moral damages are not recoverable, because no evidence of physical
[27]
injury were presented before the trial court.
To award moral damages, a court must be satisfied with proof of
the following requisites: (1) an injury -- whether physical, mental, or
psychological -- clearly sustained by the claimant; (2) a culpable act
or omission factually established; (3) a wrongful act or omission of
the defendant as the proximate cause of the injury sustained by the
claimant; and (4) the award of damages predicated on any of the
[28]
cases stated in Article 2219.
Article 2219(2) specifically allows moral damages to be recovered
for quasi-delicts, provided that the act or omission caused physical
injuries. There can be no recovery of moral damages unless the
[29]
quasi-delict resulted in physical injury.
This rule was enunciated
[30]
in Malonzo v. Galang as follows:
x x x. Besides, Article 2219 specifically mentions quasi-delicts
causing physical injuries, as an instance when moral damages may
be allowed, thereby implying that all other quasi-delicts not
resulting in physical injuries are excluded, excepting of course, the
special torts referred to in Art. 309 (par. 9, Art. 2219) and in Arts. 21,
26, 27, 28, 29, 30, 32, 34 and 35 on the chapter on human relations
(par. 10, Art. 2219).

xxx

The provisions of Article 2189 of the New Civil Code capsulizes the
responsibility of the city government relative to the maintenance of
roads and bridges since it exercises the control and supervision over
the same. Failure of the defendant to comply with the statutory
provision found in the subject-article is tantamount to negligence
per se which renders the City government liable. Harsh application
of the law ensues as a result thereof but the state assumed the
responsibility for the maintenance and repair of the roads and
bridges and neither exception nor exculpation from liability would
[20]
deem just and equitable.
(Emphasis supplied)
Petitioners belatedly point out that Fulgencio Jr. was driving at the
speed of 60 kilometers per hour (kph) when he met the
accident. This speed was allegedly well above the maximum limit of
30 kph allowed on city streets with light traffic, when not
designated through streets, as provided under the Land
Transportation and Traffic Code (Republic Act 4136). Thus,
petitioners assert that Fulgencio Jr., having violated a traffic
regulation, should be presumed negligent pursuant to Article
[21]
[22]
2185 of the Civil Code.

These matters were, however, not raised by petitioners at any time

during the trial. It is evident from the records that they brought up
for the first time the matter of violation of RA 4136 in their Motion
[23]
for Reconsideration of the CA Decision dated February 21,
2001. It is too late in the day for them to raise this new issue. It is
well-settled that points of law, theories or arguments not brought
out in the original proceedings cannot be considered on review or
[24]
appeal.
To consider their belatedly raised arguments at this stage
of the proceedings would trample on the basic principles of fair play,
[25]
justice, and due process.
Indeed, both the trial and the appellate courts findings, which are
amply substantiated by the evidence on record, clearly point to
petitioners negligence as the proximate cause of the damages
suffered by respondents car. No adequate reason has been given to
overturn this factual conclusion.
Second Issue:

Moral Damages

In the present case, the Complaint alleged that respondents son

Fulgencio Jr. sustained physical injuries. The son testified that he
suffered a deep cut on his left arm when the car overturned after
hitting a pile of earth that had been left in the open without any
warning device whatsoever.
It is apparent from the Decisions of the trial and the appellate
courts, however, that no other evidence (such as a medical
certificate or proof of medical expenses) was presented to prove
Fulgencio Jr.s bare assertion of physical injury. Thus, there was no
credible proof that would justify an award of moral damages based
on Article 2219(2) of the Civil Code.
Moreover, the Decisions are conspicuously silent with respect to the
claim of respondent that his moral sufferings were due to the
negligence of petitioners. The Decision of the trial court, which
summarizes the testimony of respondents four witnesses, makes no
mention of any statement regarding moral suffering, such as mental
anguish, besmirched reputation, wounded feelings, social
humiliation and the like.
Moral damages are not punitive in nature, but are designed to
compensate and alleviate in some way the physical suffering, mental
anguish, fright, serious anxiety, besmirched reputation, wounded
feelings, moral shock, social humiliation, and similar injury unjustly
[31]
inflicted on a person.
Intended for the restoration of the
psychological or emotional status quo ante, the award of moral
damages is designed to compensate emotional injury suffered, not
to impose a penalty on the wrongdoer.
For the court to arrive upon a judicious approximation of emotional
or moral injury, competent and substantial proof of the suffering
experienced must be laid before it. Essential to this approximation
are definite findings as to what the supposed moral damages
suffered consisted of; otherwise, such damages would become a
[32]
penalty rather than a compensation for actual injury suffered.
Furthermore, well-settled is the rule that moral damages
[33]
[34]
cannot be awarded -- whether in a civil or a criminal case -- in
the absence of proof of physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded feelings, moral
[35]
shock, social humiliation, or similar injury.
The award of moral
damages must be solidly anchored on a definite showing that
respondent actually experienced
emotional
and
mental

sufferings. Mere allegations do not suffice; they must be

[36]
substantiated by clear and convincing proof.
Third Issue:
Exemplary Damages
Petitioners argue that exemplary damages and attorneys fees are
not recoverable. Allegedly, the RTC and the CA did not find that
petitioners were guilty of gross negligence in the performance of
[37]
their duty and responsibilities.
Exemplary damages cannot be recovered as a matter of
[38]
right. While granting them is subject to the discretion of the
court, they can be awarded only after claimants have shown their
[39]
entitlement to moral, temperate or compensatory damages.
In
the case before us, respondent sufficiently proved before the
courts a quo that petitioners negligence was the proximate cause of
the incident, thereby establishing his right to actual or
compensatory damages. He has adduced adequate proof to justify
his claim for the damages caused his car. The question that remains,
therefore, is whether exemplary damages may be awardedin
addition to compensatory damages.

Article 2231 of the Civil Code mandates that in cases of quasi-delicts,

exemplary damages may be recovered if the defendant acted with
[40]
gross negligence.
Gross negligence means such utter want of care
as to raise a presumption that the persons at fault must have been
conscious of the probable consequences of their carelessness, and
that they must have nevertheless been indifferent (or worse) to the
[41]
danger of injury to the person or property of others.
The
negligence must amount to a reckless disregard for the safety of
persons or property. Such a circumstance obtains in the instant
case.
A finding of gross negligence can be discerned from the Decisions of
both the CA and the trial court. We quote from the RTC Decision:
Sad to state that the City Government through its instrumentalities
have (sic) failed to show the modicum of responsibility, much less,
care expected of them (sic) by the constituents of this City. It is even
more deplorable that it was a case of a street digging in a side street
[42]
which caused the accident in the so-called premier city.
The CA reiterated the finding of the trial court that petitioners
negligence was clear, considering that there was no warning
[43]
device whatsoever at the excavation site.
The facts of the case show a complete disregard by petitioners of
any adverse consequence of their failure to install even a single
warning device at the area under renovation. Considering further
[44]
that the street was dimly lit, the need for adequate precautionary
measures was even greater. By carrying on the road diggings
without any warning or barricade, petitioners demonstrated a
wanton disregard for public safety. Indeed, the February 28, 1988
incident was bound to happen due to their gross negligence. It is
clear that under the circumstances, there is sufficient factual basis
for a finding of gross negligence on their part.
Article 2229 of the Civil Code provides that exemplary damages may
be imposed by way of example or correction for the public
good. The award of these damages is meant to be a deterrent to
[45]
socially deleterious actions.
Public policy requires such
[46]
imposition to suppress wanton acts of an offender.
It must be
emphasized that local governments and their employees should be
responsible not only for the maintenance of roads and streets, but
also for the safety of the public. Thus, they must secure
construction areas with adequate precautionary measures.
Not only is the work of petitioners impressed with public interest;
their very existence is justified only by public service. Hence, local
governments have the paramount responsibility of keeping the
interests of the public foremost in their agenda. For these reasons,
it is most disturbing to note that the present petitioners are the very
parties responsible for endangering the public through such a rash
and reckless act.
WHEREFORE, the Petition is hereby PARTLY GRANTED. The
Decision of the Court of Appeals is AFFIRMED, with
the MODIFICATION that the award of moral damages
is DELETED. No costs.
Republic
SUPREME
Manila

of

the

Philippines
COURT

EN BANC
G.R. No. 82380 April 29, 1988
AYER PRODUCTIONS PTY. LTD. and McELROY & McELROY FILM
PRODUCTIONS, petitioners,
vs.
HON.IGNACIO
M.
CAPULONG
and
JUAN
PONCE
ENRILE, respondents.
G.R. No. 82398 April 29, 1988

HAL
MCELROY petitioner,
vs.
HON. IGNACIO M. CAPULONG, in his capacity as Presiding Judge of
the Regional Trial Court of Makati, Branch 134 and JUAN PONCE
ENRILE, respondents.

FELICIANO, J.:
Petitioner Hal McElroy an Australian film maker, and his movie
production company, Petitioner Ayer Productions pty Ltd. (Ayer
1
Productions), envisioned, sometime in 1987, the for commercial
viewing and for Philippine and international release, the histolic
peaceful struggle of the Filipinos at EDSA (Epifanio de los Santos
Avenue). Petitioners discussed this Project with local movie
producer Lope V. Juban who suggested th they consult with the
appropriate government agencies and also with General Fidel V.
Ramos and Senator Juan Ponce Enrile, who had played major roles in
the events proposed to be filmed.
The proposed motion picture entitled "The Four Day Revolution"
was endorsed by the Movie Television Review and Classification
Board as wel as the other government agencies consulted. General
Fidel Ramos also signified his approval of the intended film
production.
In a letter dated 16 December 1987, petitioner Hal McElroy
informed private respondent Juan Ponce Enrile about the projected
motion picture enclosing a synopsis of it, the full text of which is set
out below:
The Four Day Revolution is a six hour mini-series about People
Powera unique event in modern history that-made possible the
Peaceful revolution in the Philippines in 1986.
Faced with the task of dramatising these rerkble events,
screenwriter David Williamson and history Prof Al McCoy have
chosen a "docu-drama" style and created [four] fictitious characters
to trace the revolution from the death of Senator Aquino, to the Feb
revolution and the fleeing of Marcos from the country.
These character stories have been woven through the real events to
help our huge international audience understand this ordinary
period inFilipino history.
First, there's Tony O'Neil, an American television journalist working
for major network. Tony reflects the average American attitude to
the Phihppinence once a colony, now the home of crucially
important military bases. Although Tony is aware of the corruption
and of Marcos' megalomania, for him, there appears to be no
alternative to Marcos except the Communists.
Next, Angie Fox a fiery Australian photo-journalist. A 'new girl in
town,' she is quickly caught up in the events as it becomes dear that
the time has come for a change. Through Angle and her relationship
with one of the Reform Army Movement Colonels (a fictitious
character), we follow the developing discontent in the armed forces.
Their dislike for General Ver, their strong loyalty to Defense Minister
Enrile, and ultimately their defection from Marcos.
The fourth fictitious character is Ben Balano, a middle-aged editor of
a Manila newspaper who despises the Marcos regime and is a
supporter an promoter of Cory Aquino. Ben has two daughters,
Cehea left wing lawyer who is a secret member of the New People's
Army, and Eva--a -P.R. girl, politically moderate and very much in
love with Tony. Ultimately, she must choose between her love and
the revolution.
Through the interviews and experiences of these central characters,
we show the complex nature of Filipino society, and thintertwining
series of events and characters that triggered these remarkable
changes. Through them also, we meet all of the principal characters
and experience directly dramatic recreation of the revolution. The
story incorporates actual documentary footage filmed during the

period which we hope will capture the unique atmosphere and

forces that combined to overthrow President Marcos.
David Williamson is Australia's leading playwright with some 14
hugely successful plays to his credit(Don's Party,' 'The Club,'
Travelling North) and 11 feature films (The Year of Living
Dangerously,' Gallipoli,' 'Phar Lap').

production and any similar film or photoplay, until further orders

from this Court, upon plaintiff's filing of a bond in the amount of P
2,000,000.00, to answer for whatever damages defendants may
suffer by reason of the injunction if the Court should finally decide
that plaintiff was not entitled thereto.
xxx xxx xxx

Professor McCoy (University of New South Wales) is an American

historian with a deep understanding of the Philippines, who has
worked on the research for this project for some 18 months.
Together with Davi Wilhamgon they have developed a script we
believe accurately depicts the complex issues and events that
occurred during th period .

(Emphasis supplied)

The six hour series is a McElroy and McElroy co-production with

Home Box Office in American, the Australian Broadcast Corporation
in Australia and Zenith Productions in the United Kingdom

A day later, or on 23 March 1988, petitiioner Hal McElroy also filed

separate Petition for certiorari with Urgent Prayer for a Restraining
Order or Preliminary Injunction, dated 22 March 1988, docketed as
G.R. No. L-82398.

The proposed motion picture would be essentially a re-enact. ment

of the events that made possible the EDSA revolution; it is designed
to be viewed in a six-hour mini-series television play, presented in a
"docu-drama" style, creating four (4) fictional characters interwoven
with real events, and utilizing actual documentary footage as
background.
On 21 December 1987, private respondent Enrile replied that "[he]
would not and will not approve of the use, appropriation,
reproduction and/or exhibition of his name, or picture, or that of
any member of his family in any cinema or television production,
film or other medium for advertising or commercial exploitation"
and further advised petitioners that 'in the production, airing,
showing, distribution or exhibition of said or similar film, no
reference whatsoever (whether written, verbal or visual) should not
be made to [him] or any member of his family, much less to any
matter purely personal to them.
It appears that petitioners acceded to this demand and the name of
private respondent Enrile was deleted from the movie script, and
petitioners proceeded to film the projected motion picture.
On 23 February 1988, private respondent filed a Complaint with
application for Temporary Restraining Order and Wilt of Pretion with
the Regional Trial Court of Makati, docketed as Civil Case No. 88-151
in Branch 134 thereof, seeking to enjoin petitioners from producing
the movie "The Four Day Revolution". The complaint alleged that
petitioners' production of the mini-series without private
respondent's consent and over his objection, constitutes an obvious
violation of his right of privacy. On 24 February 1988, the trial court
issued ex-parte a Temporary Restraining Order and set for hearing
the application for preliminary injunction.
On 9 March 1988, Hal McElroy flied a Motion to Dismiss with
Opposition to the Petition for Preliminary Injunction contending that
the mini-series fim would not involve the private life of Juan Ponce
Enrile nor that of his family and that a preliminary injunction would
amount to a prior restraint on their right of free expression.
Petitioner Ayer Productions also filed its own Motion to Dismiss
alleging lack of cause of action as the mini-series had not yet been
completed.
2

In an Order dated 16 March 1988, respondent court issued a writ

of Preliminary Injunction against the petitioners, the dispositive
portion of which reads thus:
WHEREFORE, let a writ of preliminary injunction be issued, ordering
defendants, and all persons and entities employed or under contract
with them, including actors, actresses and members of the
production staff and crew as well as all persons and entities acting
on defendants' behalf, to cease and desist from producing and
filming the mini-series entitled 'The Four Day Revolution" and from
making any reference whatsoever to plaintiff or his family and from
creating any fictitious character in lieu of plaintiff which nevertheless
is based on, or bears rent substantial or marked resemblance or
similarity to, or is otherwise Identifiable with, plaintiff in the

On 22 March 1988, petitioner Ayer Productions came to this Court

by a Petition for certiorari dated 21 March 1988 with an urgent
prayer for Preliminary Injunction or Restraining Order, which
petition was docketed as G.R. No. L-82380.

By a Resolution dated 24 March 1988, the petitions were

consolidated and private respondent was required to file a
consolidated Answer. Further, in the same Resolution, the Court
granted a Temporary Restraining Order partially enjoining the
implementation of the respondent Judge's Order of 16 March 1988
and the Writ of Preliminary Injunction issued therein, and allowing
the petitioners to resume producing and filming those portions of
the projected mini-series which do not make any reference to
private respondent or his family or to any fictitious character based
on or respondent.
Private respondent seasonably filed his Consolidated Answer on 6
April 1988 invoking in the main a right of privacy.
I
The constitutional and legal issues raised by the present Petitions
are sharply drawn. Petitioners' claim that in producing and "The
Four Day Revolution," they are exercising their freedom of speech
and of expression protected under our Constitution. Private
respondent, upon the other hand, asserts a right of privacy and
claims that the production and filming of the projected mini-series
would constitute an unlawful intrusion into his privacy which he is
entitled to enjoy.
Considering first petitioners' claim to freedom of speech and of
expression the Court would once more stress that this freedom
includes the freedom to film and produce motion pictures and to
exhibit such motion pictures in theaters or to diffuse them through
television. In our day and age, motion pictures are a univesally
utilized vehicle of communication and medium Of expression. Along
with the press, radio and television, motion pictures constitute a
principal medium of mass communication for information,
3
education and entertainment. In Gonzales v. Katigbak, former Chief
Justice Fernando, speaking for the Court, explained:
1. Motion pictures are important both as a medium for the
communication of Ideas and the expression of the artistic impulse.
Their effect on the perception by our people of issues and public
officials or public figures as well as the pre cultural traits is
considerable. Nor as pointed out in Burstyn v. Wilson(343 US 495
[19421) is the Importance of motion pictures as an organ of public
opinion lessened by the fact that they are designed to entertain as
well as to inform' (Ibid, 501). There is no clear dividing line between
what involves knowledge and what affords pleasure. If such a
distinction were sustained, there is a diminution of the basic right to
4
free expression. ...
This freedom is available in our country both to locally-owned and to
foreign-owned motion picture companies. Furthermore the
circumstance that the production of motion picture films is a
commercial activity expected to yield monetary profit, is not a
disqualification for availing of freedom of speech and of expression.
In our community as in many other countries, media facilities are
owned either by the government or the private sector but the

private sector-owned media facilities commonly require to be

sustained by being devoted in whole or in pailt to revenue producing
activities. Indeed, commercial media constitute the bulk of such
facilities available in our country and hence to exclude commercially
owned and operated media from the exerciseof constitutionally
protected om of speech and of expression can only result in the
drastic contraction of such constitutional liberties in our country.
The counter-balancing of private respondent is to a right of privacy.
It was demonstrated sometime ago by the then Dean Irene R. Cortes
that our law, constitutional and statutory, does include a right of
5
privacy. It is left to case law, however, to mark out the precise
scope and content of this right in differing types of particular
6
situations. The right of privacy or "the right to be let alone," like
the right of free expression, is not an absolute right. A limited
intrusion into a person's privacy has long been regarded as
permissible where that person is a public figure and the information
sought to be elicited from him or to be published about him
7
constitute of apublic character. Succinctly put, the right of privacy
cannot be invoked resist publication and dissemination of matters of
8
public interest. The interest sought to be protected by the right of
privacy is the right to be free from unwarranted publicity, from
the wrongful publicizing of the private affairs and activities of an
9
individual which are outside the realm of legitimate public concern.
10

Lagunzad v. Vda. de Gonzales, on which private respondent relies

heavily, recognized a right to privacy in a context which included a
claim to freedom of speech and of expression. Lagunzad involved a
suit fortion picture producer as licensee and the widow and family of
the late Moises Padilla as licensors. This agreement gave the
licensee the right to produce a motion Picture Portraying the life of
Moises Padilla, a mayoralty candidate of the Nacionalista Party for
the Municipality of Magallon, Negros Occidental during the
November 1951 elections and for whose murder, Governor Rafael
Lacson, a member of the Liberal Party then in power and his men
11
were tried and convicted. In the judgment of the lower court
enforcing the licensing agreement against the licensee who had
produced the motion picture and exhibited it but refused to pay the
stipulated royalties, the Court, through Justice Melencio-Herrera,
said:
Neither do we agree with petitioner's subon that the Licensing
Agreement is null and void for lack of, or for having an illegal cause
or consideration, while it is true that petitioner bad pled the rights
to the book entitled "The Moises Padilla Story," that did not
dispense with the need for prior consent and authority from the
deceased heirs to portray publicly episodes in said deceased's life
and in that of his mother and the member of his family. As held in
Schuyler v. Curtis, ([1895],147 NY 434,42 NE 31 LRA 286.49 Am St
Rep 671), 'a privilege may be given the surviving relatives of a
deperson to protect his memory, but the privilege wts for the
benefit of the living, to protect their feelings and to preventa
violation of their own rights in the character and memory of the
deceased.'
Petitioners averment that private respondent did not have any
property right over the life of Moises Padilla since the latter was a
public figure, is neither well taken. Being a public figure ipso facto
does not automatically destroy in toto a person's right to privacy.
The right to invade a person's privacy to disseminate public
information does not extend to a fictional or novelized
representation of a person, no matter how public a he or she may be
(Garner v. Triangle Publications, DCNY 97 F. Supp., SU 549 [1951]). In
the case at bar, while it is true that petitioner exerted efforts to
present a true-to-life Story Of Moises Padilla, petitioner admits that
he included a little romance in the film because without it, it would
12
be a drab story of torture and brutality.
In Lagunzad, the Court had need, as we have in the instant case, to
deal with contraposed claims to freedom of speech and of
expression and to privacy. Lagunzad the licensee in effect claimed, in
the name of freedom of speech and expression, a right to produce a
motion picture biography at least partly "fictionalized" of Moises
Padilla without the consent of and without paying pre-agreed
royalties to the widow and family of Padilla. In rejecting the
licensee's claim, the Court said:

Lastly, neither do we find merit in petitioners contention that the

Licensing Agreement infringes on the constitutional right of freedom
of speech and of the press, in that, as a citizen and as a
newspaperman, he had the right to express his thoughts in film on
the public life of Moises Padilla without prior restraint.The right
freedom of expression, indeed, occupies a preferred position in the
"hierarchy of civil liberties" (Philippine Blooming Mills Employees
Organization v. Philippine Blooming Mills Co., Inc., 51 SCRA 191
[1963]). It is not, however, without limitations. As held in Gonzales v.
Commission on Elections, 27 SCRA 835, 858 [1960]:
xxx xxx xxx
The prevailing doctine is that the clear and present danger rule is
such a limitation. Another criterion for permissible limitation on
freedom of speech and the press, which includes such vehicles of
the mass media as radio, television and the movies, is the "balancing
of interest test" (Chief Justice Enrique M. Fernando on the Bill of
Rights, 1970 ed. p. 79). The principle "requires a court to take
conscious and detailed consideration of the interplay of interests
observable in given situation or type of situation" (Separation
Opinion of the late Chief Justice Castro in Gonzales v. Commission
on Elections, supra, p. 899).
In the case at bar, the interests observable are the right to privacy
asserted by respondent and the right of freedom of expression
invoked by petitioner. taking into account the interplay of those
interests, we hold that under the particular circumstances presented,
and considering the obligations assumed in the Licensing Agreement
entered into by petitioner, the validity of such agreement will have to
be upheld particularly because the limits of freedom of expression
are reached when expression touches upon matters of essentially
13
private concern."
Whether the "balancing of interests test" or the clear and present
danger test" be applied in respect of the instant Petitions, the Court
believes that a different conclusion must here be reached: The
production and filming by petitioners of the projected motion
picture "The Four Day Revolution" does not, in the circumstances of
this case, constitute an unlawful intrusion upon private respondent's
"right of privacy."
1. It may be observed at the outset that what is involved in the
instant case is a prior and direct restraint on the part of the
respondent Judge upon the exercise of speech and of expression by
petitioners. The respondent Judge has restrained petitioners from
filming and producing the entire proposed motion picture. It is
important to note that in Lagunzad, there was no prior restrain of
any kind imposed upon the movie producer who in fact completed
and exhibited the film biography of Moises Padilla. Because of the
speech and of expression, a weighty presumption of invalidity
14
vitiates. The invalidity of a measure of prior restraint doesnot, of
course, mean that no subsequent liability may lawfully be imposed
upon a person claiming to exercise such constitutional freedoms.
The respondent Judge should have stayed his hand, instead of
issuing an ex-parte Temporary Restraining Order one day after filing
of a complaint by the private respondent and issuing a Preliminary
Injunction twenty (20) days later; for the projected motion picture
was as yet uncompleted and hence not exhibited to any audience.
Neither private respondent nor the respondent trial Judge knew
what the completed film would precisely look like. There was, in
other words, no "clear and present danger" of any violation of any
right to privacy that private respondent could lawfully assert.
2. The subject matter of "The Four Day Revolution" relates to the
non-bloody change of government that took place at Epifanio de los
Santos Avenue in February 1986, and the trian of events which led
up to that denouement. Clearly, such subject matter is one of public
interest and concern. Indeed, it is, petitioners' argue, of
international interest. The subject thus relates to a highly critical
stage in the history of this countryand as such, must be regarded as
having passed into the public domain and as an appropriate subject
for speech and expression and coverage by any form of mass media.
The subject mater, as set out in the synopsis provided by the
petitioners and quoted above, does not relate to the individual life
and certainly not to the private life of private respondent Ponce

Enrile. Unlike in Lagunzad, which concerned the life story of Moises

Padilla necessarily including at least his immediate family, what we
have here is not a film biography, more or less fictionalized, of
private respondent Ponce Enrile. "The Four Day Revolution" is not
principally about, nor is it focused upon, the man Juan Ponce Enrile'
but it is compelled, if it is to be historical, to refer to the role played
by Juan Ponce Enrile in the precipitating and the constituent events
of the change of government in February 1986.
3. The extent of the instrusion upon the life of private respondent
Juan Ponce Enrile that would be entailed by the production and
exhibition of "The Four Day Revolution" would, therefore, be limited
in character. The extent of that intrusion, as this Court understands
the synopsis of the proposed film, may be generally described as
such intrusion as is reasonably necessary to keep that film a truthful
historical account. Private respondent does not claim that
petitioners threatened to depict in "The Four Day Revolution" any
part of the private life of private respondent or that of any member
of his family.
4. At all relevant times, during which the momentous events, clearly
of public concern, that petitioners propose to film were taking place,
private respondent was what Profs. Prosser and Keeton have
referred to as a "public figure:"
A public figure has been defined as a person who, by his
accomplishments, fame, or mode of living, or by adopting a
profession or calling which gives the public a legitimate interest in his
doings, his affairs, and his character, has become a 'public
personage.' He is, in other words, a celebrity. Obviously to be
included in this category are those who have achieved some degree
of reputation by appearing before the public, as in the case of an
actor, a professional baseball player, a pugilist, or any other
entertainment. The list is, however, broader than this. It includes
public officers, famous inventors and explorers, war heroes and even
ordinary soldiers, an infant prodigy, and no less a personage than
the Grand Exalted Ruler of a lodge. It includes, in short, anyone who
has arrived at a position where public attention is focused upon him
as a person.

travelogues. In determining where to draw the line, the courts were

invited to exercise a species of censorship over what the public may
be permitted to read; and they were understandably liberal in
15
allowing the benefit of the doubt.
Private respondent is a "public figure" precisely because, inter alia,
of his participation as a principal actor in the culminating events of
the change of government in February 1986. Because his
participation therein was major in character, a film reenactment of
the peaceful revolution that fails to make reference to the role
played by private respondent would be grossly unhistorical. The
right of privacy of a "public figure" is necessarily narrower than that
of an ordinary citizen. Private respondent has not retired into the
seclusion of simple private citizenship. he continues to be a "public
figure." After a successful political campaign during which his
participation in the EDSA Revolution was directly or indirectly
referred to in the press, radio and television, he sits in a very public
place, the Senate of the Philippines.
5. The line of equilibrium in the specific context of the instant case
between the constitutional freedom of speech and of expression
and the right of privacy, may be marked out in terms of a
requirement that the proposed motion picture must be fairly
truthful and historical in its presentation of events. There must, in
other words, be no knowing or reckless disregard of truth in
depicting the participation of private respondent in the EDSA
Revolution. 16 There must, further, be no presentation of the
private life of the unwilling private respondent and certainly no
revelation of intimate or embarrassing personal facts. 17 The
proposed motion picture should not enter into what Mme. Justice
Melencio-Herrera in Lagunzad referred to as "matters of essentially
private concern." 18 To the extent that "The Four Day Revolution"
limits itself in portraying the participation of private respondent in
the EDSA Revolution to those events which are directly and
reasonably related to the public facts of the EDSA Revolution, the
intrusion into private respondent's privacy cannot be regarded as
unreasonable and actionable. Such portrayal may be carried out
even without a license from private respondent.
II

Such public figures were held to have lost, to some extent at least,
their tight to privacy. Three reasons were given, more or less
indiscrimately, in the decisions" that they had sought publicity and
consented to it, and so could not complaint when they received
it; that their personalities and their affairs has already public, and
could no longer be regarded as their own private business; and that
the press had a privilege, under the Constitution, to inform the public
about those who have become legitimate matters of public
interest. On one or another of these grounds, and sometimes all, it
was held that there was no liability when they were given additional
publicity, as to matters legitimately within the scope of the public
interest they had aroused.
The privilege of giving publicity to news, and other matters of public
interest, was held to arise out of the desire and the right of the public
to know what is going on in the world, and the freedom of the press
and other agencies of information to tell it. "News" includes all
events and items of information which are out of the ordinary humdrum routine, and which have 'that indefinable quality of
information which arouses public attention.' To a very great extent
the press, with its experience or instinct as to what its readers will
want, has succeeded in making its own definination of news, as a
glance at any morning newspaper will sufficiently indicate. It
includes homicide and othe crimes, arrests and police raides,
suicides, marriages and divorces, accidents, a death from the use of
narcotics, a woman with a rare disease, the birth of a child to a
twelve year old girl, the reappearance of one supposed to have been
murdered years ago, and undoubtedly many other similar matters of
genuine, if more or less deplorable, popular appeal.
The privilege of enlightening the public was not, however, limited, to
the dissemination of news in the scene of current events. It extended
also to information or education, or even entertainment and
amusement, by books, articles, pictures, films and broadcasts
concerning interesting phases of human activity in general, as well
as the reproduction of the public scene in newsreels and

In a Manifestation dated 30 March 1988, petitioner Hal McElroy

informed this Court that a Temporary Restraining Order dated 25
March 1988, was issued by Judge Teofilo Guadiz of the Regional Trial
Court of Makati, Branch 147, in Civil Case No. 88-413, entitled
"Gregorio B. Honasan vs. Ayer Productions Pty. Ltd., McElroy Film
Productions, Hal McElroy, Lope Juban and PMP Motion for Pictures
Production" enjoining him and his production company from further
filimg any scene of the projected mini-series film. Petitioner alleged
that Honasan's complaint was a "scissors and paste" pleading, cut
out straight grom the complaint of private respondent Ponce Enrile
in Civil Case No. 88-151. Petitioner Ayer Productions, in a separate
Manifestation dated 4 April 1988, brought to the attention of the
Court the same information given by petitoner Hal McElroy,
reiterating that the complaint of Gregorio B. Honasan was
substantially identical to that filed by private respondent herein and
stating that in refusing to join Honasan in Civil Case No. 88-151,
counsel for private respondent, with whom counsel for Gregorio
Honasan are apparently associated, deliberately engaged in "forum
shopping."
Private respondent filed a Counter-Manifestation on 13 April 1988
stating that the "slight similarity" between private respondent's
complaint and that on Honasan in the construction of their legal
basis of the right to privacy as a component of the cause of action is
understandable considering that court pleadings are public records;
that private respondent's cause of action for invasion of privacy is
separate and distinct from that of Honasan's although they arose
from the same tortious act of petitioners' that the rule on permissive
joinder of parties is not mandatory and that, the cited cases on
"forum shopping" were not in point because the parties here and
those in Civil Case No. 88-413 are not identical.
For reasons that by now have become clear, it is not necessary for
the Court to deal with the question of whether or not the lawyers of
private respondent Ponce Enrile have engaged in "forum shopping."

It is, however, important to dispose to the complaint filed by former

Colonel Honasan who, having refused to subject himself to the legal
processes of the Republic and having become once again in fugitive
from justice, must be deemed to have forfeited any right the might
have had to protect his privacy through court processes.
WHEREFORE,
a) the Petitions for Certiorari are GRANTED DUE COURSE, and the
Order dated 16 March 1988 of respondent trial court granting a Writ
of Preliminary Injunction is hereby SET ASIDE. The limited Temporary
Restraining Order granted by this Court on 24 March 1988 is hereby
MODIFIED by enjoining unqualifiedly the implementation of
respondent Judge's Order of 16 March 1988 and made PERMANENT,
and
b) Treating the Manifestations of petitioners dated 30 March 1988
and 4 April 1988 as separate Petitions for Certiorari with Prayer for
Preliminary Injunction or Restraining Order, the Court, in the
exercise of its plenary and supervisory jurisdiction, hereby REQUIRES
Judge Teofilo Guadiz of the Regional Trial Court of Makati, Branch
147, forthwith to DISMISS Civil Case No. 88-413 and accordingly to
SET ASIDE and DISSOLVE his Temporary Restraining Order dated 25
March 1988 and any Preliminary Injunction that may have been
issued by him.
No pronouncement as to costs.
SO ORDERED.
Yap, C.J., Fernan, Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz,
Paras, Gancayco, Padilla, Bidin, Sarmiento, Cortes and Grio-Aquino,
JJ., concur.
G.R. No. L-48135

June 22, 1942

FELIX
MONTENEGRO, plaintiff-appellant,
vs.
ENRIQUE MEDINA, defendant-appellee.
Federico Mercader y Gil and Delgado & Taada for appellant.
Enrique Medina for appellee.
OZAETA, J.:
This is an appeal from an order of the Court of First Instance of
Oriental Negros sustaining defendant's demurrer to, and at the
same time dismissing, plaintiff's complaint.
The complaint, which was dated November 14, 1939, alleged in
substance that on July 14, 1939, the defendant Enrique Medina
instituted civil case No. 1614 of the Court of First Instance of
Oriental Negros against the herein plaintiff Felix Montenegro and
Nicolasa Montenegro for the recovery of a sum of money alleged to
be due to Enrique Medina for professional services rendered at the
instance of Felix Montenegro; that in relation to the complaint in
said civil case No. 1614, and without being material, relevant, and
pertinent to the cause of action alleged therein, but with the only
purpose of mortifying the plaintiff and attacking his honesty,
integrity, and reputation and of exposing him to public hatred and
ridicule, the said defendant Enrique Medina wrote, inserted, and
published as paragraph 24 of the first cause of action of the
complaint in said civil case No. 1614 the following words which were
highly malicious, defamatory and libelous per se, to wit:
24. Que el demandado Felix Montenegro es de las personas que con
frecuencia procuran eludir el pago de sus justas obligaciones y no
obstante su indiscutible solvencia, no paga religiosamente sus
compromisos y cuentas legales, y muchos de sus acreedores,
abogados, empleados, contratistas, y personas con quienes ha
tenido cuentas, no han podido cobrarle sino reido el y muchos,
presentando accion o escrito judicial por la cual, sus mismos
parientes que trabajaban con dicho Felix Montenegro salieron todos
disgustados, por no poder cobrar, lo que por ley tenian derecho de
cobrar.

That subsequently, upon motion of the plaintiff and over the

opposition of the defendant, the paragraph above quoted was
stricken out by order of the court for being impertinent and
unnecessary to the cause of action of the plaintiff in said civil case
No. 1614; that the plaintiff is an hacendero and a merchant and
possesses valuable real estate in Manila, Cebu, and in the Province
of Oriental Negros, and is the president and principal stockholder of
the corporation Felix Montenegro, Inc., to which the Philippine
National Bank granted a credit of P100,000 without any security on
accounts of his good name and reputation, and that the success of
his enterprises depends to a great extent on the confidence of the
public in his honesty and integrity; and that, as a consequence of
said acts of defamation, the plaintiff has suffered damages in the
sum of P25,000 on account of the outrage to his feelings and
reputation, and that, in addition to said sum, he is entitled to receive
from the defendant another sum of P25,000 as punitive exemplary
damages.
To that complaint the defendant demurred on the grounds (1) that
the facts alleged in the complaint do not constitute a cause of action
and (2) that there exists another case between the parties founded
on the same cause of action. In resolving said demurrer the trial
court quoted its order entered on October 11, 1939, in civil case No.
1614, in which it held that paragraph 24 of the complaint in said
case was "impertinent, redundant and unnecessary" and ordered
that the same be stricken out; and, upon the ground that said order
had not yet become final inasmuch as the therein plaintiff
(defendant in this case) had excepted, thereto, the court held that
the plaintiff did not yet have a cause of action, and therefore
dismissed the complaint.
The first ground of the demurrer that the facts alleged in the
complaint do not constitute a cause of action was based on the
contention that the alleged defamatory matter complained of,
having been published in the course of a judicial proceeding, was
absolutely privileged and therefore not actionable; while the second
ground of the demurrer the existence of another action between
the parties was based on the contention that the order of the trial
court striking out paragraph 24 of the complaint in civil case No.
1614 had not yet become final, that there was an intimate relation
between the two cases, and that the plaintiff should have
represented his claim for damages in the same civil case No. 1614.
The ordered appealed from is based on the assumption that it is an
essential prerequisite that the court declare a defamatory matter
uttered in the course of a judicial proceeding to be immaterial and
irrelevant and order that the same be stricken out before an action
for libel could be brought thereon. There is no basis in law or in
jurisprudence for such an assumption. An action for libel accrues
from the date of publication and must be instituted within two years
thereafter. The fact that the plaintiff had moved to strike out the
allegedly libelous allegation as being immaterial, irrelevant, and
impertinent could not and did not in any way affect his right to bring
an independent action for damages on account of the libel. The
motion to strike out and the action for damages may be filed
simultaneously and independently of each other; they are not
mutually exclusive. Indeed, the court may of its own motion order
expunged from its records any sham, irrelevant, scurrilous, or
incident matter to preserve its dignity and protect public morals.
It is patent that the trial court erred in holding in effect that
plaintiff's action was premature.
The important question raised by the demurrer, which the trial court
failed to decide, is whether the allegedly libelous matter complained
of is absolutely privileged and therefore not actionable. In Santiago
vs. Calvo (48 Phil., 919, 923) this Court held that "parties counsel,
and witnesses are exempted from liability in libel or slander for
words otherwise defamatory published in the course of judicial
proceedings, provided the statements are pertinent or relevant to
the case." The same doctrine was applied in Smith, Bell & Co. vs.
Ellis (48 Phil., 475). It is the generally accepted rule that in order to
be protected by the mantle of privilege the defamatory words must
be pertinent and relevant to the subject under inquiry. (See Newell
on Slander and Libel, 3d ed., section 518, page 515, and cases
therein cited; 33 Am. Jur., section 149, pages 144-145, and cases;
section 230, pages 1253-1254.) The reason for such requirement is

that the protection given to individuals in the interest of an efficient

administration of justice may not be abused as a cloak from beneath
which private malice may be gratified (16 A. L. R., 748).
Are the allegations of paragraph 24 of the complaint in civil case no.
1614, herein before quoted, material and relevant to the case? We
do not need to decide that question on the merit because the case is
before us on demurrer and the complaint in case No. 1614 has not
been brought up here. It is expressly alleged in the complaint
demurrered to:
4. Que en relacion con dicho escrito de demanda en dicha causa civil
No. 1614 y sin ser materiales, relevantes y pertinentes al motivo de
accion objeto de dicha demanda pero si con el solo proposito
mortificar al demandante y atacar la honradez, integridad y
reputacion del aqui demandante y exponerle al desprecio odio,
oprobio y ridiculo publicos, escribio, inserto, y publico e hizo que se
escribiera redactara, insertara y publicara, como parrafo 24 del
primer motivo de accion de la demandada en dicha causa civil No.
1614 la siguientes palabras altamente maliciosas, difamatorias y
libelosas per se, que se leen sigue:
xxx

xxx

xxx

(Emphasis ours)
and these allegations are hypothetically admitted by the demurrer.
We must therefore assume that paragraph 24 is immaterial and
irrelevant and, hence, not privileged Since the imputations
contained in said paragraph constitute a grave reflection upon the
moral character and reputation of Felix Montenegro as a property
owner and businessman, they are libelous per se.
Defendant's contention that the plaintiff should have presented his
claim for damages in the same civil case No. 1614, is devoid of merit
inasmuch as plaintiff's claim did no exist at the time of the
commencement of case No. 1614 and did not arise out of
transaction therein involved. Hence it was no obligatory for the
plaintiff herein to set up his claim by way of counter-claim in said
case. (Section 97, Act No. 190.)
We deem it unnecessary at this time to pass upon the question of
whether or not section 11 of Act No. 277, which expressly allows the
recovery, not only of actual pecuniary damages sustained by the
party libeled but also of damages for injury to his feelings and
reputation as well as punitive damages, is still in force
notwithstanding repealing clause of the Revised Penal Code. The
complaint under consideration states facts sufficient to constitute a
cause of action for actual damages, and the plaintiff-appellant is
entitled to have it heard on the merits regardless of whether or not
he is entitled also to damages for injury to his feelings and
reputation and to punitive damages. That question has not been
submitted to the court below, and we do not deem it necessary to
decide it at this stage of the case.
The order appealed from is reversed, and let the case be remanded
to the court of origin for further proceedings, with the costs of this
appeal against the appellee. So ordered.
Yulo,
C.J.,
Paras
and
Moran, JJ., concurs in the result.

Bocobo,

JJ., concur.

FIRST DIVISION
G.R. No. 159352

April 14 ,2004

PREMIERE
DEVELOPMENT
BANK, petitioner,
vs.
COURT OF APPEALS, PANACOR MARKETING CORPORATION and
ARIZONA TRANSPORT CORPORATION,respondents.
DECISION
YNARES-SANTIAGO, J.:

This is a petition for review under Rule 45 of the 1997 Rules on Civil
Procedure seeking the annulment of the Decision dated June 18,
1
2003 of the Court of Appeals which affirmed the Decision of the
2
Regional Trial Court in Civil Case No. 65577.
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 Panacors
creditworthiness, Premiere Bank rejected the loan application and
suggested that its affiliate company, Arizona Transport Corporation
3
(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
4
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
5
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 Banks 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 Banks legal office. The full text of
6
the letter reads:
Please be informed that we have approved the loan application of
ARIZONA TRANSPORT CORP. and PANACOR MARKETING
CORPORATION. Both represented by MR. PEDRO P. PANALIGAN
(hereinafter the BORROWERS) in the principal amount of PESOS:
SEVEN MILLION FIVE HUNDRED THOUSAND ONLY (P7,500,000.00)
Philippine Currency. The loan shall be secured by a Real Estate
Mortgage over a parcel of land located at #777 Nueve de Pebrero St.
Bo. Mauway, Mandaluyong City, Metro Manila covered by TCT No.
3475 and registered under the name of Arizona Haulers, Inc. which
is presently mortgaged with your bank.
The borrowers have authorized IBA FINANCE CORP. to pay Premiere
Bank from the proceeds of their loan. The disbursement of the loan,
however is subject to the annotation of our mortgage lien on the
said property and final verification that said title is free from any
other lien or encumbrance other than that of your company and IBA
Finance Corporation.
In order to register the mortgage, please entrust to us the owners
duplicate copy of TCT No. 3475, current tax declaration, realty tax
receipts for the current year and other documents necessary to
affect annotation thereof.
Upon registration of our mortgage, we undertake to remit directly to
you or your authorized representative the amount equivalent to the
Borrowers outstanding indebtedness to Premiere Bank as duly
certified by your goodselves provided such an amount shall not

exceed PESOS: SIX MILLION ONLY (P6,000,000.00) and any amount

in excess of the aforestated shall be for the account of the
borrowers. It is understood that upon receipt of payment, you will
release to us the corresponding cancellation of your mortgage
within five (5) banking days therefrom.
If the foregoing terms and conditions are acceptable to you, please
affix your signature provided below and furnish us a copy of the
Statement of Account of said borrowers.
7

On October 12, 1995, Premiere Bank sent a letter-reply to IbaFinance, 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 banks 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
8
Statement of Account showing Arizonas total loan indebtedness.
On October 19, 1995, Panacor and Arizona executed in favor of IbaFinance 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 owners duplicate copy of TCT
9
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 owners duplicate copy of TCT No. 3475 and the cancellation by
Premiere Bank of Arizonas mortgage. Occasioned by Premiere
Banks 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, the decretal portion of which reads:
WHEREFORE, judgment is hereby rendered in favor of the plaintiff
Panacor Marketing Corporation and against the defendant Premiere
Bank, ordering the latter to pay the former the following sums,
namely:

2) Ordering the defendant Premiere Bank to pay to Intervenor IBAFinance, the following sums, to wit:
3) P1,000,000.00 as and by way of exemplary damages; and
4) P100,000.00 as and for reasonable attorneys fees; and
5) Costs of suit.
For lack of sufficient legal and factual basis, the counterclaim of
defendant Premiere Bank is DISMISSED.
SO ORDERED.
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 IbaFinance 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
dispositive portion of which reads:
WHEREFORE, premises considered, the present appeal is hereby
DISMISSED, and the decision appealed from in Civil Case No. 65577
is hereby AFFIRMED with MODIFICATION in that the award of
exemplary damages in favor of the appellees is hereby reduced to
P500,000.00. Needless to add, in view of the Compromise
Agreement plaintiff-intervenor IBA-Finance and defendant-appellant
PREMIERE between plaintiff-intervenor IBA-Finance and defendantappellant PREMIERE as approved by this Court per Resolution dated
March 11, 1999, Our dispositive of the present appeal is only with
respect to the liability of appellant PREMIERE to the plaintiffappellees.
With costs against the defendant-appellant.
SO ORDERED.

10

Hence the present petition for review, which raises the following
11
issues:
I

2) P1,000,000.00 as and for exemplary damages;

WHETHER OR NOT THE DECISION OF HONORABLE COURT OF

APPEALS EXCEEDED AND WENT BEYOND THE FACTS, THE ISSUES
AND EVIDENCE PRESENTED IN THE APPEAL TAKING INTO
CONSIDERATION THE ARGUMENT OF PETITIONER BANK AND
ADVENT OF THE DULY APPROVED COMPROMISE AGREEMENT
BETWEEN THE PETITIONER BANK AND IBA FINANCE CORPORATION.

3) P100,000.00 as and for reasonable attorneys fees; and

II

4) Costs of suit.

WHETHER OR NOT THE ISSUES THAT SHOULD HAVE BEEN RESOLVED

BY THE HONORABLE COURT OF APPEALS, BY REASON OF THE
EXISTENCE OF THE COMPROMISE AGREEMENT, IS LIMITED TO THE
ISSUE OF ALLEGED BAD FAITH OF PETITIONER BANK IN THE
DOWNGRADING OF THE LOAN AND SHOULD NOT INCLUDE THE
RENDITION OF AN ADVERSE PRONOUNCEMENT TO AN ALREADY
FAIT ACCOMPLI- ISSUE ON THE REFUSAL OF THE BANK TO
RECOGNIZE THE TAKE-OUT OF THE LOAN AND THE RELEASE OF TCT
NO. 3475.

1) P4,520,000.00 in addition to legal interest from the time of filing

of the complaint until full payment;

Similarly, judgment is hereby rendered in favor of plaintiff-inintervention IBA-Finance Corporation as against defendant Premiere
bank, as follows, namely:
1) Ordering defendant Premiere Bank to release to plaintiffintervenor IBA-Finance Corporation the owners duplicate copy of
Transfer Certificate of Title No. 3475 registered in the name of
Arizona Haulers, Inc. including the deed of cancellation of the
mortgage constituted thereon;

III

WHETHER OR NOT PETITIONER ACTED IN BAD FAITH IN THE

DOWNGRADING OF THE LOAN OF RESPONDENTS TO SUPPORT AN
AWARD OF ACTUAL AND EXEMPLARY DAMAGES NOW REDUCED TO
P500,000.00.
IV
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.
Firstly, Premiere Bank argues that considering the compromise
agreement it entered with Iba-Finance, the Court of Appeals should
have ruled only on the issue of its alleged bad faith in downgrading
Panacors credit line. It further contends that the Court of Appeals
should have refrained from making any adverse pronouncement on
the refusal of Premiere Bank to recognize the take-out and its
subsequent failure to release the cancellation of the mortgage
because they were rendered fait accompli by the compromise
agreement.
We are not persuaded.
12

In a letter-agreement dated October 5, 1995, Iba-Finance informed

Premiere Bank of its approval of Panacors loan application in the
amount of P10 million to be secured by a real estate mortgage over
a parcel of land covered by TCT No. T-3475. It was agreed that
Premiere Bank shall entrust to Iba-Finance the owners duplicate
copy of TCT No. T-3475 in order to register its mortgage, after which
Iba-Finance shall pay off Arizonas outstanding indebtedness.
Accordingly, Iba-Finance remitted P6,235,754.79 to Premiere Bank
on the understanding that said amount represented the full
payment of Arizonas loan obligations. Despite performance by IbaFinance of its end of the bargain, Premiere Bank refused to deliver
the mortgage document. As a consequence, Iba-Finance failed to
release the remaining P2.5 million loan it earlier pledged to Panacor,
which finally led to the revocation of its distributorship agreement
with Colgate.
Undeniably, the not-so-forthright conduct of Premiere Bank in its
dealings with respondent corporations caused damage to Panacor
and Iba-Finance. It is error for Premiere Bank to assume that the
compromise agreement it entered with Iba-Finance extinguished all
direct and collateral incidents to the aborted take-out such that it
also cancelled its obligations to Panacor. The unjustified refusal by
Premiere Bank to release the mortgage document prompted IbaFinance to withhold the release of the P2.5 million earmarked for
Panacor which eventually terminated the distributorship agreement.
Both Iba-Finance and Panacor, which are two separate and distinct
juridical entities, suffered damages due to the fault of Premiere
Bank. Hence, it should be held liable to each of them.
While the compromise agreement may have resulted in the
satisfaction of Iba-Finances legal claims, Premiere Banks liability to
Panacor remains. We agree with the Court of Appeals that the
"present appeal is only with respect to the liability of appellant
Premiere Bank to the plaintiffs-appellees (Panacor and
13
Arizona)" taking into account the compromise agreement.
For the foregoing reasons, we find that the Court of Appeals did not
err in discussing in the assailed decision the abortive take-out and
the refusal by Premiere Bank to release the cancellation of the
mortgage document.
Secondly, Premiere Bank asserts that it acted in good faith when it
downgraded the credit line of Panacor from P4.1 million to P2.7
million. It cites the decision of the trial court which, albeit
inconsistent with its final disposition, expressly recognized that the
downgrading of the loan was not the proximate cause of the
damages suffered by respondents.
14

Under the Credit Line Agreement dated September 1995, Premiere

Bank agreed to extend a loan of P4.1 million to Arizona to be used
by its affiliate, Panacor, in its operations. Eventually, Premiere
approved in favor of Arizona a loan equivalent to P6.1 million, P3.4

million of which was allotted for the payment of Arizonas existing

loan obligations and P2.7 million as credit line of Panacor. Since only
P2.7 million was made available to Panacor, instead of P4.1 million
as previously approved, Panacor applied for a P2.5 loan from IbaFinance, which, as earlier mentioned, was not released because of
Premiere Banks refusal to issue the mortgage cancellation.
It is clear that Premiere Bank deviated from the terms of the credit
line agreement when it unilaterally and arbitrarily downgraded the
credit line of Panacor from P4.1 million to P2.7 million. Having
entered into a well-defined contractual relationship, it is imperative
that the parties should honor and adhere to their respective rights
and obligations thereunder. Law and jurisprudence dictate that
obligations arising from contracts have the force of law between the
15
contracting parties and should be complied with in good faith. The
appellate court correctly observed, and we agree, that:
Appellants actuations, considering the actual knowledge of its
officers of the tight financial situation of appellee PANACOR brought
about primarily by the appellant banks considerable reduction of
the credit line portion of the loan, in relation to the "bail-out" efforts
of IBA Finance, whose payment of the outstanding loan account of
appellee ARIZONA with appellant was readily accepted by the
appellant, were truly marked by bad faith and lack of due regard to
the urgency of its compliance by immediately releasing the
mortgage cancellation document and delivery of the title to IBA
Finance. That time is of the essence in the requested release of the
mortgage cancellation and delivery of the subject title was only too
well-known to appellant, having only belatedly invoked the crossdefault provision in the Real Estate Mortgage executed in its favor
by appellee ARIZONA to resist the plain valid and just demand of IBA
16
Finance for such compliance by appellant bank.
Premiere Bank cannot justify its arbitrary act of downgrading the
credit line on the alleged finding by its project analyst that the
distributorship was not financially feasible. Notwithstanding the
alleged forewarning, Premiere Bank still extended Arizona the loan
of P6.1 million, albeit in contravention of the credit line agreement.
This indubitably indicates that Premiere Bank had deliberately and
voluntarily granted the said loan despite its claim that the
distributorship contract was not viable.
Neither can Premiere Bank rely on the puerile excuse that it was the
banks policy not to release the mortgage cancellation prior to the
settlement of outstanding loan obligations. Needless to say, the
Final Statement of Account dated October 17, 1995 showing in no
uncertain terms Arizonas outstanding indebtedness, which was
subsequently paid by Iba-Finance, was the full payment of Arizonas
loan obligations. Equity demands that a party cannot disown it
previous declaration to the prejudice of the other party who relied
reasonably and justifiably on such declaration.
Thirdly, Premiere Bank avers that the appellate courts reliance on
the credit line agreement as the basis of bad faith on its part was
inadmissible or self-serving for not being duly notarized, being
unsigned in all of its left margins, and undated. According to
Premiere Bank, the irregularities in the execution of the credit line
agreement bolsters the theory that the same was the product of
manipulation orchestrated by respondent corporations through
undue influence and pressure exerted by its officers on Martillano.
Premiere Banks posture deserves scant consideration. As found by
the lower court, there are sufficient indicia that demonstrate that
the alleged unjust pressure exerted on Martillano was more
imagined than real. In her testimony, Martillano claims that she was
persuaded and coaxed by Caday of Iba-Finance and Panaligan of
Panacor to sign the letter. It was she who provided Iba-Finance with
the Final Statement of Account and accepted its payment without
objection or qualification. These acts show that she was vested by
Premiere Bank with sufficient authority to enter into the said
transactions.
If a private corporation intentionally or negligently clothes its
officers or agents with apparent power to perform acts for it, the
corporation will be estopped to deny that the apparent authority is
real as to innocent third persons dealing in good faith with such

17

officers or agents. As testified to by Martillano, after she received a

copy of the credit line agreement and affixed her signature in
conformity thereto, she forwarded the same to the legal
department of the Bank at its Head Office. Despite its knowledge,
Premiere Bank failed to disaffirm the contract. When the officers or
agents of a corporation exceed their powers in entering into
contracts or doing other acts, the corporation, when it has
knowledge thereof, must promptly disaffirm the contract or act and
allow the other party or third persons to act in the belief that it was
authorized or has been ratified. If it acquiesces, with knowledge of
the facts, or fails to disaffirm, ratification will be implied or else it
18
will be estopped to deny ratification.
Finally, 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
19
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.

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.
It is obvious that the wrongful acts of Premiere Bank adversely
22
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 attorneys 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.
Davide, Jr., Panganiban, Carpio, and Azcuna, JJ., concur.

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.
Premieres 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
20
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.
The Code Commission, in explaining the concept of temperate
21
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 ones
commercial credit or to the goodwill of a business firm is often hard

SECOND DIVISION
[G.R. No. 111263. May 21, 1998]
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs.
MARIO PADLAN @ MARCOS, ROMEO MAGLEO @ MOTMOT,
and ALFREDO MAGLEO @ BOY, accused-appellants.
DECISION
MENDOZA, J.:
[1]

This is an appeal from the decision, dated June 30, 1993, rendered
by the Regional Trial Court, Branch 56 of San Carlos City, Pangasinan,
in Criminal Case No. SCC-1960, finding accused-appellants Mario
Marcos Padlan, Romeo Motmot Magleo, and Alfredo
Boy Magleo guilty of two counts of murder and sentencing each of
them
to suffer an imprisonment of:
1. Reclusion perpetua, for the death of Rodolfo Manzon.
2. Reclusion perpetua, for the death of Mateo Manzon.
and to indemnify the heirs of the deceased as follows:
1) P60,000.00 for the death of Rodolfo Manzon.
2) P50,000.00 for the death of Mateo Manzon.
3) P100,000.00 for actual and temperate damages.
4) P200,000.00 as moral damages.
5) P5,000.00 as exemplary damages.

The information filed against accused-appellants charged

That on or about the 15th day of November, 1992, at around 1:15
oclock in the morning at Barangay Libas, San Carlos City in
Pangasinan, and within the jurisdiction of this Honorable Court, the
above-named accused, conspiring, confederating, and mutually
aiding each other, with evident premeditation, treachery, and intent
to kill, did then and there wilfully, unlawfully, and feloniously, with
the use of high-powered long firearm, attack and shoot Rodolfo
Manzon and Mateo Manzon, killing them instantaneously as a
consequence, to the damage and prejudice of the heirs of the said
victims in the amount of P ____________.
Contrary to Article 248 of the Revised Penal Code.

[2]

When arraigned on June 7, 1993, accused-appellants pleaded not

guilty, whereupon trial was held. The prosecutions main witnesses
were Carlito Manzon and Jordan Pagsolingan. Carlito Manzon is a
nephew of the deceased Rodolfo Manzon, Carlitos father being the
brother of Rodolfo Manzon. Jordan Pagsolingan is the son of Carlito
Manzons sister, Flora Pagsolingan, and therefore is a grandnephew
of the deceased Rodolfo Manzon.
[3]

Per their testimonies, at around 11 p.m. of November 14, 1992, at

a pre-wedding dance in Barangay Libas, San Carlos City, Rufo
Manzon was beaten up by accused-appellant Mario Padlan and a
certain Lito Fernandez. He was saved from further punishment by
the timely intervention of Carlito Manzon and Jordan Pagsolingan
who took him away and led him to the house of Flora Pagsolingan in
Barangay Anando. Carlito Manzon and Jordan Pagsolingan then
went to Barangay Payar to fetch Rufos father, Rodolfo
Manzon. Mateo, a brother of Rufo, came along in response.
At Sitio Caniogon of Barangay Libas, the four saw accused-appellants
Mario Padlan, Romeo Magleo, and Alfredo Magleo. They tried to
avoid them, but they were pursued by the three. Romeo Magleo
ordered them to stop, shouting Hoy! at them. Carlito and Jordan
saw that Mario Padlan was armed with a rifle. Jordan also saw that
accused-appellant Alfredo Magleo had a knife.
Carlito and Jordan were young boys aged 16 and 15,
respectively. Mario Padlan went around the two boys to get near
Rodolfo Manzon and then shot the latter. Mario Padlan fired three
[4]
times at Rodolfo Manzon, as the other accused-appellants
[5]
watched.
Frightened, Jordan Pagsolingan and Carlito Manzon ran away. As
they were fleeing, Jordan Pagsolingan said he heard two more shots
[6]
fired. He and Carlito went home to Barangay Anando to report the
incident. Upon learning of the incident, Jordans mother, Flora
Pagsolingan, and Eling Manzon lost no time and went to the city
proper to report the matter to the police.
Flora Pagsolingan corroborated the testimonies of her son Jordan
[7]
and her brother Carlito Manzon. She testified that the incident was
[8]
entered in the blotter of the police.
SPO4 Alberto Castro of the Philippine National Police in San Carlos
[9]
City also testified. He said that upon receipt of Flora Pagsolingans
report, at 3:20 a.m. of November 15, 1992, a team of policemen
went to the scene of the crime and afterwards to the residence of
Mario Padlan in Barangay Libas, but was told by the latters wife that
he did not go home that night. The police finally found him at about
7 a.m., in the house of his father-in-law, Alejandro Magleo. Magleo,
a former barangay captain, surrendered Mario Padlan to the
police. SPO4 Castro said that the report mentioning the
participation of the two other accused-appellants, Romeo and
[10]
Alfredo Magleo, came only at about 5 in the morning.
SPO Virgilio G. Cardioza, who was a member of the team, testified
that they recovered from the scene of the crime four empty shells
[11]
fired from an armalite rifle. Rodolfo Manzon had a short bolo
[12]
which the police found to be in its scabbard, while Mateo Manzon
[13]
had a slingshot with darts. Near the feet of Rodolfo Manzon the
[14]
police found a knife. SPO Cardioza said he interviewed Jordan

Pagsolingan and was told that Mario Padlan fired at them and that
[15]
with Padlan were Romeo and Alfredo Magleo. SPO Cardioza said
that he and his companions after sometime found Mario Padlan in
the house of his father-in-law, but they were unable to locate the
other accused-appellants Romeo and Alfredo Magleo in their
[16]
residences.
[17]

Lolita Manzon, the wife and mother of the victims, testified that
prior to their death, Rodolfo Manzon worked as a tenant farmer on
land that produced eight cavans a year, while her son Mateo, 15
years of age, was a high school sophomore who helped his father
farm the land. She bought coffins but could not remember how
much she paid for them because of her shock and grief. The deaths
of her husband and son were for her very painful because there
[18]
were two of them.
Dr. Juan I. Pizarro, who conducted the postmortem examination of
the bodies of the victims, found Rodolfo Manzon to have suffered
the following wounds:
1.
Lacerated wound, anterior surface of left forearm, 3 inches
1
1
from the elbow, measuring 1 /2 by 1 /2 inch.
1

2.
Incised wound rectangular in shape /2 inch by /2 inch, /4 inch
1
deep located /2 inch just below wound No. 1.
3.
Gunshot wound with point of entrance, circular in shape, 10
mm. in diameter, located at the left epigastric area along anterior
axillary line 3 inches below the coastal line with irregular borders
penetrating the abdominal cavity with portion of the intestine
protruding outside through this wound.
Point of Exit - None.

[19]

Dr. Pizarro testified that wound no. 1 could have been caused by a
pointed instrument and wound no. 2 by a sharp-bladed
instrument. Wound no. 3 was the fatal wound, which caused
[20]
massive internal hemorrhage.
Dr. Pizarro found Mateo Manzon to have suffered a *g+aping incised
1
1
1
wound 2 /2 inches long and 1 /2 inches wide and 5 /2 inches deep
horizontally across the anterior chest wall just below the medial end
of the right clavicle lacerating the right first rib and right portion of
the sternum, directed posteriorily to the left lacerating the lungs and
[21]
the heart. According to Dr. Pizarro, the wound, which was
[22]
caused by a sharp-pointed instrument, was fatal.
[23]

Accused-appellant Alfredo Magleo admitted that he was at the

pre-wedding party in Barangay Libas in the evening of November 14,
1992. He claimed, however, that he and accused-appellant Mario
Padlan and others did not leave the place until 4 a.m. of the
following day, November 15, 1992. Alfredo said that from the party
he went home to Barangay Anando, and that in the morning, while
the police officers went to the house of his father and arrested his
brother-in-law, accused-appellant Mario Padlan, they did not arrest
him (Alfredo Magleo) despite the fact that his house was only 15
meters away.
Accused-appellants Mario Padlan and Romeo Magleo also
[24]
interposed the defense of alibi. Padlan claimed that they were in
the house of Aniceto de la Cruz for the pre-wedding party for the
latters daughter, Evangeline de la Cruz, and Roly Domingo which
lasted from 7 p.m. of November 14, 1992 up to 4 a.m. of November
15, 1992; and that after the party, accused-appellant Romeo Magleo
stayed behind, as he had been asked by Aniceto de la Cruz to help
prepare the food for the guests on the day of the wedding.
Padlan claimed that from the party, he went to the house of his
father-in-law Alejandro Magleo because his wife was there. It was
there that the police found him and invited him to go with them to
the police station for questioning. He said he denied involvement in
the killing and even asked to be given a paraffin test by the National
Bureau of Investigation, but that although he was taken to the NBI,
he could not be tested because of lack of equipment. Padlan also

testified that he had no misunderstanding with the Pagsolingan

family.
[25]

For his part, Romeo Magleo testified that before he left the
house of Aniceto de la Cruz (where the party was held) at 8:30 a.m.
of November 15, 1992, Flora Pagsolingan arrived with some
policemen and asked if any untoward incident had happened during
the celebration, to which Romeo Magleo said he answered in the
negative; and that he (Romeo Magleo) was not apprehended by the
police officers.
Aniceto de la Cruz, in whose house the party was held, testified that
none of the accused-appellants had left the party before it ended at
[26]
4 a.m. of November 15, 1992.
The defense also presented as witnesses three farmers, Rodolfo
Lavarias, Tomas Lavarias, and Ernesto Lavarias, all of whom were
[27]
residents of Barangay Anando. Ernesto Lavarias testified that at
around midnight of November 14, 1992, he heard cries coming from
the house of Flora Pagsolingan less than 30 meters away. For this
reason, he said, he fetched his brother Tomas and the two of them
then went to Floras house. There they learned that Rufo Manzon
had been beaten up. Rufo was brought to the house of
Flora. According to Ernesto Lavarias, Flora Pagsolingan sent her son
Jordan Pagsolingan and Carlito Manzon to fetch Rufos parents. In
no time, Jordan and Lito were back with news that Rufos parents
were coming.
[28]

On rebuttal, Flora Pagsolingan testified that actually Ernesto and

Tomas Lavarias went to her house only at about 1:15 in the morning
of November 15, 1992, and that was because of the news that
Rodolfo Manzon had been shot.
The trial court found accused-appellants guilty as charged in its
decision, the dispositive portion of which was quoted earlier
herein. Hence, this appeal. Accused-appellants contend:

FIRST, SECOND & THIRD SHIFT: 0800h-0800h 14-15 NOVEMBER

1992.
Entry Nr-496
Date: 11-15-92
Time: 0320H = Flora Pagsolingan y Manzon, 39 years old, widow,
housekeeper, high school graduate, and resident of Brgy. Anando,
this city came and reported to this office that Rodolfo Manzon and
Mateo Manzon, Carlito Manzon and Jordan Pagsolingan were fired
upon by Marcos Pagsolingan in company w/ two other whom they
do not know their names. Reportee further reported that they do
not know whether Mateo Manzon and Rodolfo Manzon were
hit. Incident happened at about 1:15 A.M. today November 15,
1992 at Brgy. Libas, this city per her signature appear herein.
SGD: Flora Pagsolingan
SPO4 Albert Castro, SPO4 A. Patayan PO3 Viduya, PO3 Cardinoza,
SPO2 Tamayo and PO3 Lazaro were dispatched to investigate.
SGD: SPO4 ANDRES G.
ELERTA
[31]

Desk Officer

Flora Pagsolingan explained that at the time she made the report,
she was in *a+ state of shock ... confused, and did not know what
[32]
*she+ was doing. She must have been in such a state of agitation
that even the police investigator, who took down her statement,
identified accused-appellant Mario Marcos Padlan as Marcos
Pagsolingan, although Flora maintains she never said the assailant
was Marcos Pagsolingan. As she testified:
COURT:

I.
THE LOWER COURT ERRED IN NOT FINDING THE EVIDENCE OF THE
PROSECUTION SUBSTANTIALLY INSUFFICIENT TO ESTABLISH THE
GUILT OF THE HEREIN ACCUSED-APPELLANTS BEYOND REASONABLE
DOUBT IN THE CASE AT BAR.
II.
THE LOWER COURT ERRED IN NOT GIVING WEIGHT TO THE
EVIDENCE OF THE HEREIN ACCUSED-APPELLANTS.

Q Now, in this police blotter, it was entered by the police, which

you also confirmed, that it was Marcos Pagsolingan who fired his
gun?
A

What I said was Marcos Padlan, sir.

Q So, in other words, this entry in this police blotter is not

accurate?
A I said Marcos Padlan, your Honor, and I did not put so much
attention on the two because my mind was confused.

The contentions are without merit.

First. Accused-appellants were positively identified by prosecution
witnesses Jordan Pagsolingan and Carlito Manzon as the ones who
had stopped them on the way on the day of the incident. While
accused-appellants claimed they were in the house of Aniceto de la
Cruz attending a pre-wedding party, their alibi cannot prevail over
the testimonies of the prosecution witnesses positively identifying
them as the assailants. The place where accused-appellants were at
the time of the killing is in Barangay Libas where the crime also took
place. It was not at all physically impossible for them to have
[29]
committed the crime. Each of the accused-appellants claimed he
had no quarrel with the deceased or the prosecutions main
witnesses. Their identification, however, makes it irrelevant that
there is no proof of ill motive on their part to commit the
crime. Motive assumes significance only where there is no showing
[30]
of who the perpetrators of the crimes were.
It is contended that the testimonies of the two prosecution
eyewitnesses, Carlito Manzon and Jordan Pagsolingan, are at odds
with the entry in the police blotter. Accused-appellants Romeo and
Alfredo Magleo contend that entry in the police blotter does not
name them as among those involved in the killing of Rodolfo
Manzon and his son Mateo.
The entry reads:

Q In other words, you confirmed the fact that your son Jordan
Pagsolingan and this Carlito Manzon told you that it was Marcos
Padlan who fired his gun at Rodolfo Manzon and Mateo Manzon?
A

It was what they were telling me, sir.

[33]

Accused-appellants contend that Floras son, Jordan, and Carlito

Manzon could have corrected her or otherwise helped her since the
two boys were with her when she gave her statement to the
police. But the two boys said they were themselves agitated if not in
[34]
shock as well as in fear and so possibly could not have corrected
Floras mistakes.
Accused-appellants cite the testimony of SPO4 Alberto Castro which
allegedly corroborates the blotter entry naming accused-appellant
Mario Padlan as the only assailant. That is not so. SPO4 Castros
testimony is as follows:
Q Aside from Marcos Padlan, did [Jordan Pagsolingan] also
mention others?
A Actually, at the crime scene when we conducted an
investigation, Flora Pagsolingan and her son were only mentioning
Marcos Padlan, sir.

Q Now, what time did you receive that report from Flora
Pagsolingan on November 15, 1992?
A

If I am not mistaken, before 5:00 oclock, sir.

5:00 oclock in the morning?

Yes, sir.

Q And you immediately formed a team and investigated the

veracity of the report, can you tell us further what time more or less
did you go to the place of the incident?
A

beaten up. There really appears to be a discrepancy concerning this

matter. However, it is not denied that Rufo Manzon had been
beaten up by Mario Padlan and Lito Fernandez, and this was the
reason his father, the deceased Rodolfo Manzon, was
summoned. Whether Rufo Manzon was with Carlito Manzon and
Jordan Pagsolingan when he was set upon or whether he was then
alone is therefore of little moment.
Accused-appellants point out other discrepancies in the evidence
of the prosecution. Accused-appellants cite Jordan Pagsolingans
testimony that accused-appellant Mario Padlan fired three times at
Rodolfo Manzon and that, as he and Carlito Manzon were fleeing, he
heard two more gunshots, so that in all accused-appellant fired at
the victims five times.

3:20 oclock in the morning of November 15, sir.

Q So that, do we understand from you senior police officer that the

report was made at 5:00 oclock in the morning of November 15?
A No, sir, what I mean, I am referring to the other accused that if I
am not mistaken, there were three (3) accused in this particular
case. We received a report only at about 5:00 oclock in the morning
mentioning the two (2) accused.
Q

Who were the two (2) accused?

Magleo brothers, sir.

In what manner are they accused of?

A In the first place, this Flora Pagsolingan and her son only
mentioned Marcos Padlan, so, we concentrated on Marcos
[35]
Padlan, we invited him to the police station, sir.
Thus what SPO4 Castro said was that while in the beginning only
accused-appellant Mario Padlan was named by Flora Pagsolingan
and her son Jordan, the police later received a report at 5 a.m. that
accused-appellants Romeo Magleo and Alfredo (Boy) Magleo were
also involved in the killing of Rodolfo Manzon and his son Mateo. In
fact, according to the police blotter, Rodolfo Manzon, his son Mateo,
Carlito Manzon, and Jordan Pagsolingan were fired at by Mario
Marcos Padlan (erroneously identified therein as Marcos
Pagsolingan) and two unidentified men. Another member of the
police team, SPO Virgilio G. Cardioza, also testified that, during
their investigation at the scene of the crime, Jordan Pagsolingan
[36]
named the two Magleos as the companions of Mario Padlan.
It is not surprising that attention should focus on Mario Padlan
because he was the one seen by Jordan Pagsolingan and Carlito
Manzon shooting Rodolfo Manzon. In the process, the participation
of the other two as coconspirators was obscured. But when it came
to their turn to make their sworn statements and later to testify in
court, Jordan Pagsolingan and Carlito Manzon categorically stated
that the Magleo brothers were present at the shooting.
Moreover, it should not be forgotten that entries in police blotters,
though regularly done in the course of the performance of official
duty, are not conclusive proof of the truth stated in such entries and
should not be given undue significance or probative value because
they are usually incomplete and inaccurate. Sometimes they are
based on partial suggestion or inaccurate reporting and hearsay,
[37]
untested in the crucible of a trial on the merits. But an indication
of the guilt of the Magleos is the fact that shortly after the killing
they went into hiding. They could not be found in their respective
residences for which reason an alias warrant had to be issued by the
trial court for their arrest. Flight has been held to be evidence of
[38]
guilt.
Second. Accused-appellants focus on the credibility of the
prosecution witnesses. Accused-appellants point out a discrepancy
between Jordan Pagsolingan and Carlito Manzons testimonies to
the effect that they were with Rufo Manzon when the latter was
attacked by Mario Padlan and Lito Fernandez and their
[39]
affidavits in which they stated that they were on their way to the
pre-wedding dance party when they came upon Rufo Manzon being

Accused-appellants say that this is contrary to the evidence that

Rodolfo Manzon sustained only one gunshot wound.
The number of wounds does not have to be equal to the number of
shots, because some of the shots may have missed their mark. It is
also possible that in the excitement of the moment, Jordan
Pagsolingan may have made a mistake as to the number of shots he
heard. What is important is that although Rodolfo Manzon suffered
only one gunshot wound, the fact is that the police recovered four
empty shells from the scene of the crime. This confirms the
statement of Jordan Pagsolingan that several gunshots had been
fired by accused-appellant Mario Padlan.
Accused-appellants claim that had it been their intention to kill the
victims, they could easily have ambushed the victims instead of
openly confronting them, considering that they are known to the
witnesses and the victims. This assumes that accused-appellants
knew that the Manzons were going to pass the place where they
were so as to enable them to waylay their victims. The fact,
however, is that it was the Manzons who saw accused-appellants at
a distance and who tried to run away from them, but accusedappellants, using a shortcut, were able to overtake the Manzons.
Accused-appellants doubt whether the prosecution witnesses really
recognized them. Accused-appellants argue that if Mario Padlan
trained his flashlight on the group of the eyewitnesses and the
Manzons, the prosecution witnesses would not have recognized
accused-appellants. As Jordan Pagsolingan explained, however, it
was quite bright that early morning because there was a moon and
accused-appellants were known to them because we usually joke
[40]
together. Carlito Manzon also testified that the moon was bright
[41]
at that time.
Finally, accused-appellants brand the prosecution evidence as
fabricated because of the close relationship of the prosecutions
main witnesses to the victims. In the absence of proof of improper
motive, the mere relationship of the prosecution witnesses to the
victims is not a ground for doubting their truthfulness. On the
contrary, their natural interest to secure the conviction of the real
culprits could have deterred them from implicating otherwise
[42]
innocent persons, for then the real culprits would go scot free. In
this case, there is additional reason for rejecting accused-appellants
contention that because of their relationship to the deceased the
prosecution witnesses concocted stories to lay the blame for the
killing on accused-appellants: accused-appellants admitted that they
had no quarrel or misunderstanding with the Pagsolingan family
which could make Jordan Pagsolingan and Carlito Manzon testify
falsely against them.
The various criticisms made by accused-appellants against the
testimonies of Jordan Pagsolingan and Carlito Manzon boil down to
a question of their credibility. The trial court, which was in the
unique position to hear the witnesses and observe their deportment
[43]
and manner of testifying, believed their testimonies. We have
considered the contrary view of accused-appellants which we find to
be without merit. Accused-appellants have not shown that, in the
evaluation of the testimonies of the witnesses for both parties, the
trial court overlooked matters of substance and weight justifying
[44]
reversal of the findings of the trial court. Accordingly, we give its
findings full faith and credit.

Third. Accused-appellants claim that even if all of them were

present at the scene of the crime, no inference of conspiracy can be
drawn since the two prosecution eyewitnesses did not see Romeo
and Alfredo Magleo attack the victims. Several circumstances
indicate, however, that there was a conspiracy to kill Rodolfo
Manzon and his son, Mateo, in addition to the fact that all
of accused-appellants were at the scene of the crime, to wit: (1)
accused-appellant Romeo Magleo shouted Hoy! at the Manzons to
make them stop as the latter were running away; (2) accusedappellants pursued the Manzons when the latter tried to flee from
them; and (3) accused-appellant Alfredo Magleo was seen by Jordan
Pagsolingan with a knife, which fits the description of the weapon
used in wounding Rodolfo Manzon and Mateo Manzon: pointed
[45]
and sharp-bladed.
Nevertheless, we do not think that the crime committed was
murder. The qualifying circumstances of evident premeditation and
treachery have not been shown in this case. Proof of conspiracy
does not imply the existence of evident premeditation. Evident
premeditation can be presumed only where conspiracy is directly
established, not where, as in this case, conspiracy is only
[46]
[47]
implied. Nor was treachery established with certainty. The
prosecution has not shown that there was that swift and
unexpected attack of an unarmed victim, which is the essence of
[48]
treachery. First, the victims were not defenseless, since they too
were armed. Rodolfo had a bolo, while Mateo had a slingshot with
darts. Second, the sight of accused-appellants at a distance must
have sufficiently warned the Manzons of accused-appellants and
their intentions; that was why they tried to evade them. Thus, an
important condition for the existence of treachery under Art. 14(16)
of the Revised Penal Code has not been proven: that the means of
execution employed was deliberately and consciously adopted so as
to give the person attacked no opportunity to defend himself or to
retaliate. Accordingly, the killing of Rodolfo Manzon and his son
Mateo constitutes not murder but only homicide.
The trial court found that the killing was attended by the aggravating
circumstances of (1) abuse of superior strength, (2) aid of armed
men, and (3) nocturnity. Indeed, there was abuse of superior
strength in this case. Whatever superiority in number the victims
had over accused-appellants (four to three) was more than offset by
the fact that the latter group was composed of adult males in their
[49]
physical prime. Accused-appellant Mario Padlan was 28, while
[50]
accused-appellants Romeo and Alfredo Magleo were 26 and
[51]
32, respectively. In contrast, the former group, with the sole
[52]
exception of Rodolfo Manzon, who was 43, was composed of
youths barely in their early teens. Mateo Manzon and Jordan
[53]
Pagsolingan were both 15 years old, while Carlito Manzon was 16
[54]
years of age. More importantly, the group of accused-appellants
had a firearm and a knife which gave them a clear advantage over
the bolo and slingshot of the victims.
But we do not think the aggravating circumstance of nocturnity can
be appreciated as nocturnity was not shown to have been purposely
[55]
sought by accused-appellants the better to commit the crime. Nor
can the aggravating circumstance of aid of armed men be
appreciated, considering that accused-appellants, as coconspirators,
[56]
acted under the same plan and for the same purpose.
Under Art. 249 of the Revised Penal Code the penalty for homicide
is reclusion temporal. As there was one aggravating circumstance
(abuse of superior strength), the penalty should be fixed in its
maximum period, the duration of which is from 17 years, 4 months,
and 1 day to 20 years. Under the Indeterminate Sentence Law, the
minimum of the penalty is prision mayor, which is from 6 years and
1 day to 12 years, as the penalty next lower in degree to reclusion
temporal.
In addition, we find errors committed by the trial court in awarding
damages for the death of Rodolfo Manzon and his son Mateo. The
[57]
indemnity for death as currently fixed isP50,000.00 so the trial
courts award of P60,000.00 for the death of Rodolfo Manzon should
be reduced accordingly.
The award of P100,000.00 for actual and temperate damages cannot
be
allowed. Damages
cannot
be
both
actual
and

temperate. Temperate or moderate damages are allowed because,

while some pecuniary loss has been suffered, from the nature of the
[58]
case its amount cannot be proved with certainty. This is not the
case here. The trial court awarded theP100,000.00 as temperate
damages apparently because the prosecution failed to adduce proof
of expenses in connection with the death, wake, or burial of Rodolfo
and Mateo Manzon but not because from the nature of the case it
was not possible to show with certainty the amount of the damage
done. For the same reason, no award of actual damages can be
[59]
made.
The award of P200,000.00 for moral damages is excessive. As moral
[60]
damages are not intended to enrich the prevailing party, an
award of P50,000.00 would be in keeping with this purpose of the
law.
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 P20,000.00 can be appropriately
[61]
awarded. In reviewing the records of this case, we noticed a
variance between the allegation in the information and the evidence
presented regarding the manner in which Mateo Manzon was
killed. The information alleged that he and his father Rodolfo
Manzon were killed with the use of high-powered long firearm,
but the medical certificate indicates that while Rodolfo Manzon
suffered both incised and lacerated wounds as well as a gunshot
wound, his son Mateo suffered only a *g+aping incised wound
1
1
1
2 /2 inches long and 1 /2 inches wide and 5 /2 inches deep
horizontally across the anterior chest wall just below the medial end
of the right clavicle lacerating the right first rib and right portion of
the sternum, directed posteriorily to the left lacerating the lungs and
the heart. The variance, however, is not an obstacle to finding the
accused-appellants liable for double homicide. The variance does
not affect or change the nature of the crime charged, namely,
murder, which in view of our finding is actually homicide. The
variance concerns merely the manner of execution of the
crime. The defense could have objected to the presentation of the
evidence, in which event the court could have ordered the
amendment of the information so as to make the allegation conform
to the evidence presented and the accused-appellants would be
none the worse for it. Accordingly, we hold that accused-appellants
are liable for two counts of homicide.
WHEREFORE, the decision of the Regional Trial Court is AFFIRMED
with the MODIFICATION that the accused-appellants are found
guilty of two counts of homicide and each one is sentenced to two
prison terms of 12 years of prision mayor, as minimum, to 20 years
of reclusion temporal, as maximum, and to pay to the heirs of the
victims P50,000.00 as indemnity for the death of Rodolfo
Manzon, P50,000.00 as indemnity for the death of Mateo
Manzon, P50,000.00 as moral damages, and P20,000.00 as
exemplary damages.
SO ORDERED
Regalado, (Chairman), Melo, Puno, and Martinez, JJ., concur.
G.R. No. L-17883

December 30, 1961

RODOLFO
B.
SANTIAGO,
ETC., plaintiff-appellee,
vs.
AMADO DIMAYUGA, ETC., defendant-appellant.
Grey,
Jr.
and
Buenaventura
for
Santos and Associates for defendant-appellant.

plaintiff-appellee.

DE LEON, J.:
This is an action for various sums of money upon six causes of
action, plus interests, attorney's fees and costs. The first five causes
of action are based upon promissory notes executed on different
dates for the payment on installment basis of the balance of the

costs of automobiles purchased by defendant from plaintiff, while

the sixth cause of action is based on sales invoices covering costs of
materials and repairs made by plaintiff on defendant's motor
vehicles on various occasions.
On March 19, 1959, after defendant's answer was filed, the parties
and their respective counsel filed a joint petition which is in the
nature of partial amicable settlement. In that petition, defendant
admitted his liability for the principalamounts alleged in the first five
causes of action (unpaid installments which, according to the notes,
became due and payable upon defendant's failure to pay any of said
installments), aggregating P42,789.23, payment of which is partially
assumed by a third person. The other questions were left to the
court for decision. The aforesaid partial amicable settlement was
approved by the court, and the attached properties of defendant
were released from the attachment. On June 15, 1959, the parties
and their counsel submitted a stipulation of facts, whereby
defendant admitted his liability for the costs of materials and
repairs, without interest, alleged in the sixth cause of action, as well
as his liability for accrued interests upon the first five causes of
action. They submitted to the court's discretion the determination of
the amount of attorney's fees and costs of suit.
From the parties' agreements, the court a quo rendered judgment
ordering defendant to pay plaintiff the sums of P208.39 as cost of
repairs, P886.84 as interests up to and including March 19, 1959,
plus an additional amount of 20% on the sum of P42,789.23 as
attorney's fees, and the costs of suit. Regarding the award for
attorney's fees, the court below stated in its decision:
In the promissory notes executed by the defendant, the latter
undertook to pay to the plaintiff a sum equivalent to 33-/3% by way
of attorney's fees, plus expenses of collection and costs. Considering
the facts and circumstances of this case, the Court is of the opinion
that an amount of 20% is reasonable as attorney's fees.
Not satisfied, defendant appealed to the Court of Appeals, upon the
following assignments of errors:
I. That the trial court erred in not finding that the provision of the
promissory notes on the award of attorney's fees in the event of
judicial proceedings to enforce collection is not applicable in this
case; and,
II. That the trial court erred in determining as reasonable 20% of the
amount involved in the complaint for attorney's fees.
The Court of Appeals, by resolution, certified the case to this Court
for disposition, on the ground that the appeal involves purely
questions of law.
The genuineness of the five promissory notes copied in their entirety
in the complaint is not controverted. The stipulations as to the
payment of attorney's fees are the same in all the notes, and read:
In the event of my (our) failure to pay any of the foregoing
installments, the whole sum remaining then unpaid will immediately
become due and payable, at the option of the holder of this note,
and in the event of judicial proceedings to enforce collection, I (we,
jointly and severally), further promise to pay to the holder of this
note an additional sum equivalent to 33-/3% of the amount due, for
and as attorney's fees and expenses of collection, in addition to the
costs of suit.

Article 1229 of the new Civil Code provides:

Art. 1229. The judge shall equitably reduce the penalty when the
principal obligation has been partly or irregularly complied with by
the debtor. Even if there has been no performance, the penalty may
also be reduced by the courts if it is iniquitous or unconscionable.
The above legal proviso fully justifies the action of the lower court in
reducing the attorney's fee from an amount equivalent to 33-/3% to
20% of the principal obligation due and admitted in this case, it
appearing that several installment payments had already been made
by defendant-appellant on the five promissory notes before the
commencement of the action. Furthermore, it is the opinion of this
Court that where a contract does not expressly stipulate that a fixed
sum by way of attorney's fees shall be paid by defendant in case of
collection even if same is subsequently settled by compromise, it is
just and fair to reduce the amount of counsel fee, in the court's
discretionary power, where the case is partially or fully settled out of
court.
Appellant, however, wants to remove this action of plaintiff from
the purview of their stipulation above-quoted, by claiming that this
case is not a "judicial proceeding to enforce collection" but for the
purpose of settling the disagreement as to the manner of
application of the payments on the five promissory notes. But it is
clear that the complaint is for collection or recovery of various sums
of money. As repeatedly stated, the purpose of action or suit and
the law to govern it is to be determined by the complaint itself, its
allegations and the prayer for relief (Benares vs. Benares, G.R. No. L6438, June 3, 1955; Belandres vs. Lopez Sugar Central, G.R. No.
6869, May 7, 1955). Needless to state, were it not for this suit,
accompanied by an attachment on defendant's automobiles, it is not
far-fetched to surmise that defendant may probably, as before,
neglect or refuse to pay the installments as they fall due.
WHEREFORE, the decision appealed from is affirmed, with costs
against defendant-appellant.
Bengzon, C.J., Bautista Angelo, Labrador, Concepcion, Reyes, J.B.L.,
Barrera,
Paredes
and
Dizon,
JJ., concur.
Padilla, J., took no part.
G.R. No. 83033 June 8, 1990
NORTHWEST
ORIENT
AIRLINES, petitioner,
vs.
COURT OF APPEALS, CONCEPCION S. SALONGA, BENJAMIN
SALONGA, ANNETE S. PASTORAL, JOY ANN S. PASTORAL
(represented by their parents BENJAMIN C. PASTORAL and
ERLINDA S. PASTORAL) and MARILOU VELISANO (represented by
her
parents
CARMELITA
VELISANO
and
GABRIEL
VELISANO),respondents.
Guerrero and Torres for petitioner.
Salonga, Andres, Hernandez & Associates and Angara, Concepcion,
Regala & Cruz for private respondents.

CRUZ, J.:
As found by the respondent court, the facts of this case are simple.

A stipulation or agreement regarding the payment of attorney's fees

is neither illegal nor immoral and is enforceable as the law between
the parties (Luneta Motor vs. Mora Limponco, 73 Phil. 80). Under
the new Civil Code, attorney's fee is an element of recoverable
damages, whether it be in writing (Articles 11226, supra) or not
stipulated at all in certain cases (Article 2208, supra). Attorney's fee
is in the concept of actual damages (Fores vs. Miranda, G.R. No. L12163, March 4, 1959), except that when it is stipulated and
therefore in the form of liquidated damages no proof of pecuniary
loss is required (Article 2216, supra).lawphil.net

Three young ladies, Annette Pastoral, Joy Ann Pastoral, and Marilou
Velisano, who are among the private respondent herein, were gifted
on their graduation with their first trip abroad, to Hongkong, Tokyo
and the United States, by their parents. Accompanied by their
grandmother, Concepcion Salonga, they flew on April 23, 1978, to
Hongkong, where they were to await their plane tickets for the rest
of their trip.
On April 26, 1978, Erlinda Pastoral and her uncle, Serafin Salonga,
went to the Office of the petitioner's agent, the Inter-Pacific Transit,

Inc., in Manila to purchase the said tickets. They paid the computed
total price of P25,100.40 in the afternoon of that same day and were
assured that the tickets would be delivered to the passengers in
Hongkong in time for their flight to Japan the following day.
The Hongkong office of the Northwest Orient Airlines found,
however, that ITI had made a mistake in the computation of the
price of the tickets-in fact, two mistakes. That office first sent a telex
to the Manila office that the wrong conversion rates of exchange
had been used and that there was a deficit of $160.70 for each
ticket. Then a second telex advised that the 10% mileage surcharge
had not been paid, which meant that the revised additional charge
should be further increased to $261.60 per ticket.
As a result of these errors, the NOA office in Hongkong refused to
release the prepaid tickets to the four passengers when Annette
Pastoral and Marilou Velisano came to claim them on April 27, 1978.
They were told they had to pay the additional fare of $261.60 per
ticket. The girls requested the NOA personnel to cheek with their
Manila Office, but this request was arrogantly rejected in the
presence of many persons. As the flight was scheduled at one
o'clock that same afternoon, the girls had no choice but to pay the
total differential fare of $ 1,046.40.
That unexpected expense depleted their foreign currency and
caused them a great deal of tension and inconvenience. They had to
stay in a cheap hotel in Tokyo, with all four of them occupying only
one room. Marilou got sick. The 69-year old Concepcion, who had a
heart condition, fretted. Frantic and worried over their dwindlings
funds, the girls called up their parents for assistance. Their
grandfather, Benjamin Salonga, finally decided to fly to Japan to join
them, incurring additional expenses for this purpose.
On January 4, 1979, the private respondents sued the petitioner and
ITI for breach of contract and damages. After trial, judgment was
rendered for the plaintiffs and the defendants were jointly and
severally required.
1. To pay unto the plaintiffs the expenses of Benjamin Salonga from
Manila to Tokyo only which should be less than P5,000.00 to include
actual fare and incidental expenses of travel;
2. To pay moral damages for physical sufferings, mental anguish,
serious anxiety and humuliation in the amount of P400,000.00
incurred by each passenger;
3. To pay exemplary damages unto plaintiffs in the breach of
contract and a public duty as a carrier P200,000.00; and
4. To pay for and as attorney's fees P80,000.00 for having failed to
honor immediately plaintiffs' just and lawful demand thus
compelling plaintiffs to go to court; and to pay the costs of the
1
proceedings.
On its motion for reconsideration, however, ITI was absolved of
2
liability as a mere agent of the petitioner.
On appeal, the findings of the trial court were sustained by the
respondent court which, however, modified the decision as follows:
WHEREFORE, the decision appealed from is modified by ordering the
defendant Northwest Orient Airlines to pay P50,000.00 to each
passenger as moral damages, P10,000.00 each to the passengers as
exemplary damages and P50,000.00 as attorney's fees.
The award of P5,000.00 to Benjamin Salonga is eliminated.
Costs against the appellant Northwest Orient Airlines.
SO ORDERED.

The petitioner now challenges this ruling on the ground that there is
no factual or legal basis for the award to the plaintiffs of the moral
and exemplary damages, and neither are the attorney's fees

justified. While it now concedes that it was negligent in computing

the correct fare, it insists it had not acted in bad faith or with malice,
to warrant the said awards.
The rule, indeed, is that even if there is a breach of contract, as
admitted in this case, moral damages are nevertheless not justified
where only simple negligence can be imputed to the defendant.
4

In China Airlines v. Intermediate Appellate Court, we held as

follows:
With respect to moral damages, the rule is that the same are
recoverable in a damage suit predicated upon a breach of contract
of carriage only where (1) the mishap results in the death of a
passenger and (2) it is proved that the carrier was guilty of fraud or
bad faith, even if death does not result. As the present case does not
fall under either of the cited instances, the award of moral damages
should be, as it is hereby disallowed.
And only recently, Sabena Belgian
5
Appeals affirmed the doctrine that:

World

vs.

Court

of

In cases of breach of contract, moral damages can be awarded only

where the defendant has acted fraudulently or in bad faith. Mere
negligence, even if thereby the plaintiff suffers mental anguish or
serious fright is not ground for awarding moral damages.
However, the finding of the trial court in the case at bar is that the
petitioner should not be faulted with mere negligence that would
absolve it from damages for its breach of contract. Rejecting its
defense of good faith, Judge Rafael de la Cruz observed:
To evade liability good faith is being claimed by the defendants in
the performance of their part of the obligation. The facts adduced
from the pleadings and the records, to our mind, are not sufficient
to make good faith the thinly veiled excuse for justification because
as aptly said: "A contract to transport passengers is quite different in
kind and degree from any other contractual relations. And this is so
because of the relation which an air carrier sustains with the public.
Its business is mainly with the travelling public. It invites people to
avail of the comfort and advantages it offers. The contract of air
carriage therefore generates a relation attended with public duty.
Neglect or malfeasance of the carriers' employees, naturally, could
give ground for an action for damages.
The court agrees.
We note first the error upon error committed by the petitioner's
agent in computing the passengers' fare, a task with which it was
not exactly unfamiliar, being experienced in the travel business. That
negligence imposed needless burden on the passengers who had
gone on their trip, the first abroad for the three girls, precisely to
enjoy themselves. Worse, the negligence, which was strange enough
as it was, was not the only vexation. On top of this annoyance was
the manner in which the petitioner's personnel in Hongkong sought
to rectify the supposed mistakes of its Manila office. It was far from
acceptable.
The petitioner's employees should have been at least polite if not
even sympathetic and apologetic to the two young girls in the
foreign land. Instead they were overbearing and hostile, forgetting
that they were dealing not with bothersome persons begging for a
free ride. The girls were respectable passengers who had in fact paid
for their tickets in advance in the exact amount computed by the
petitioner's own agent in Manila.
Annete Pastoral and Marilou Velisano testified that they were
treated coldly and arrogantly by the NOA Hongkong personnel. They
were flatly told their tickets would not be released unless the
additional charge was paid. They were humiliated when their
request to contact the Manila office by telex was haughtily rejected
in the presence and within hearing of other persons. They were not
accorded the courtesy due them even only as ordinary individuals if
not, indeed, as pre-paid passengers.

We accept the findings of the lower courts in this regard, absent a

clear showing that they were arbitrarily reached. We are satisfied
with the evidence that the petitioner's personnel in Hongkong were
less than polite to the two young ladies who, it must be added, had
not provoked any boorishness. And we also agree with the following
observation of the respondent court:
We find no merit in the contention of appellant NOA that no
coercion or threat or force (was) used on the passengers in the
payment of the additional amount of $261.00 from each passenger.
The worries and axiety of the Plaintiffs passengers started when the
Hongkong office of NOA refused to issued their tickets for the rest of
their trip to the United States. There may be no threat with physical
sence but the mere fact of the refusal of defendant's office in
Hongkong to issue the pre-paid tickets was enough tension as they
could be stranded in Hongkong with meager funds.
The cavalier treatment of the two girls at the Hongkong NOA office
requires a brief comment. The Court feels it is about time foreigners
realized that Filipinos, whatever their station in life, are entitled to
the same civility accorded other persons when they are in an alien
land. We cannot be dismissed or disdained on the basis of our
nationality, which is as proud and as respectable as any other on this
earth. The haughty attitude of some foreigners who seem to think
they belong to a superior race has irked not a few Filipino travelers.
Let it be stressed to our credit that we are not impressed at all by
such self-importance. Airlines should especially advise their
personnel against superciliousness when dealing with citizens of the
Philippines and are cautioned that this Court will not countenance
that kind of conduct.
We hold that the acts of the petitioner, assessed in their totality,
constituted more than mere negligence and assumed the
dimensions of bad faith. There was clear malice here, manifested in
the contemptuous disregard of the passenger's protest and the
abrupt rejection of their request that the Manila office be contacted
for verification of the correct billing. Rudeness is never excusable. It
is especially condemnable if it is committed in one's own country
against a foreign guest, as in the case at bar. It is not correct to say
that moral damages are not due Concepcion Salonga and Joy Ann
Pastoral because they had not testified on the effects of the
petitioner's acts upon them. The other two girls took the stand to
described their common experiences and reactions and were later
corroborated by Benjamin Salonga. Their testimonies were enough.
It is true that we denied moral damages to the plaintiff inFrancisco v.
6
GSIS, because she failed to testify as to her social humiliation,
wounded feelings and anxiety. In that case, however, there was
absolutely no evidence in this respect from her or from any other
source, let alone the fact that bad faith had also not been proved.
But we do agree that the amount awarded in the present case is
rather steep. We hereby reduce it to P10,000.00 for each of the four
passengers plus another P10,000.00 each for Annette Pastoral and
Marilou Velisano for their humiliation at the NOA Hongkong office.
We sustain the award of exemplary damages, to deter the petitioner
and other airlines from the commission of the acts complained of by
the private respondents. Airlines should always bear in mind the
special responsibilities they owe their passengers not only of
carrying them safely and comfortably according to their contracts
but also of extending to them the courtesy due them in all matters
relating to their trip, including reservations, confirmation of
bookings, ticketing and other ground and in-flight services. The fare
of the passenger includes payment for politeness.
In view of our findings regarding the mala fides of the petitioner, we
also approve the award of attorney's fees but reduce it in our
discretion to P20,000.00.
WHEREFORE, with the modification of the amount of the moral
damages and of the attorney's fees as above indicated, the appealed
decision of the respondent court is AFFIRMED, with costs against the
petitioner.
SO ORDERED.

Narvasa (Chairman), Gancayco and Medialdea, JJ., concur.

Grio-Aquino, J., is on leave.
SECOND DIVISION
[G.R. No. 110398. November 7, 1997]
NEGROS NAVIGATION CO., INC., petitioner, vs. THE COURT OF
APPEALS, RAMON MIRANDA, SPS. RICARDO and VIRGINIA DE LA
VICTORIA,respondents.
DECISION
MENDOZA, J.:
This is a petition for review on certiorari of the decision of the Court
of Appeals affirming with modification the Regional Trial Courts
award of damages to private respondents for the death of relatives
as a result of the sinking of petitioners vessel.
In April of 1980, private respondent Ramon Miranda purchased from
the Negros Navigation Co., Inc. four special cabin tickets (#74411,
74412, 74413 and 74414) for his wife, daughter, son and niece who
were going to Bacolod City to attend a family reunion. The tickets
were for Voyage No. 457-A of the M/V Don Juan, leaving Manila at
1:00 p.m. on April 22, 1980.
The ship sailed from the port of Manila on schedule.
At about 10:30 in the evening of April 22, 1980, the Don
Juan collided off the Tablas Strait in Mindoro, with the M/T Tacloban
City, an oil tanker owned by the Philippine National Oil Company
(PNOC) and the PNOC Shipping and Transport Corporation
(PNOC/STC). As a result, the M/V Don Juan sank. Several of her
passengers perished in the sea tragedy. The bodies of some of the
victims were found and brought to shore, but the four members of
private respondents families were never found.
Private respondents filed a complaint on July 16, 1980 in the
Regional Trial Court of Manila, Branch 34, against the Negros
Navigation, the Philippine National Oil Company (PNOC), and the
PNOC Shipping and Transport Corporation (PNOC/STC), seeking
damages for the death of Ardita de la Victoria Miranda, 48, Rosario
V. Miranda, 19, Ramon V. Miranda, Jr., 16, and Elfreda de la Victoria,
26.
In its answer, petitioner admitted that private respondents
purchased ticket numbers 74411, 74412, 74413 and 74414; that the
ticket numbers were listed in the passenger manifest; and that
the Don Juan left Pier 2, North Harbor, Manila on April 22, 1980 and
sank that night after being rammed by the oil tanker M/T Tacloban
City, and that, as a result of the collision, some of the passengers of
the M/V Don Juan died. Petitioner, however, denied that the four
relatives of private respondents actually boarded the vessel as
shown by the fact that their bodies were never
recovered. Petitioner further averred that the Don Juan was
seaworthy and manned by a full and competent crew, and that the
collision was entirely due to the fault of the crew of the
M/T Tacloban City.
On January 20, 1986, the PNOC and petitioner Negros Navigation
Co., Inc. entered into a compromise agreement whereby petitioner
assumed full responsibility for the payment and satisfaction of all
claims arising out of or in connection with the collision and releasing
the PNOC and the PNOC/STC from any liability to it. The agreement
was subsequently held by the trial court to be binding upon
petitioner, PNOC and PNOC/STC. Private respondents did not join in
the agreement.
After trial, the court rendered judgment on February 21, 1991, the
dispositive portion of which reads as follows:

WHEREFORE, in view of the foregoing, judgment is hereby rendered

in favor of the plaintiffs, ordering all the defendants to pay jointly
and severally to the plaintiffs damages as follows:
To Ramon Miranda:
P42,025.00 for actual damages;
P152,654.55
as compensatory damages for loss of earning
capacity of his wife;
P90,000.00
as compensatory damages for wrongful death of
three (3) victims;
P300,000.00 as moral damages;
P50,000.00
as exemplary damages, all in the total amount
of P634,679.55; and
P40,000.00 as attorneys fees.
To Spouses Ricardo and Virginia de la Victoria:
P12,000.00 for actual damages;
P158,899.00
capacity;

as compensatory damages for loss of earning

P30,000.00 as compensatory damages for wrongful death;

P100,000.00 as moral damages;
P20,000.00
as exemplary damages, all in the total amount
of P320,899.00; and
P15,000.00 as attorneys fees.
[1]

On appeal, the Court of Appeals affirmed the decision of the

Regional Trial Court with modification
1. Ordering and sentencing defendants-appellants, jointly and
severally, to pay plaintiff-appellee Ramon Miranda the amount
of P23,075.00 as actual damages instead of P42,025.00;
2. Ordering and sentencing defendants-appellants, jointly and
severally, to pay plaintiff-appellee Ramon Miranda the amount
of P150,000.00, instead of P90,000.00, as compensatory damages
for the death of his wife and two children;
3. Ordering and sentencing defendants-appellants, jointly and
severally, to pay plaintiffs-appellees Dela Victoria spouses the
amount of P50,000.00, instead of P30,000.00, as compensatory
damages for the death of their daughter Elfreda Dela Victoria;
Hence this petition, raising the following issues:
(1) whether the members of private respondents families were
actually passengers of the Don Juan;
[2]

(2) whether the ruling in Mecenas v. Court of Appeals, finding the

crew members of petitioner to be grossly negligent in the
performance of their duties, is binding in this case;
(3) whether the total loss of the M/V Don Juan extinguished
petitioners liability; and
(4) whether the damages awarded by the appellate court are
excessive, unreasonable and unwarranted.
First. The trial court held that the fact that the victims were
passengers of the M/V Don Juan was sufficiently proven by private
respondent Ramon Miranda, who testified that he purchased tickets

numbered 74411, 74412, 74413, and 74414 at P131.30 each from

the Makati office of petitioner for Voyage No. 47-A of the M/V Don
Juan, which was leaving Manila on April 22, 1980. This was
corroborated by the passenger manifest (Exh. E) on which the
numbers of the tickets and the names of Ardita Miranda and her
children and Elfreda de la Victoria appear.
Petitioner contends that the purchase of the tickets does not
necessarily mean that the alleged victims actually took the
trip. Petitioner asserts that it is common knowledge that passengers
purchase tickets in advance but do not actually use them. Hence,
private respondent should also prove the presence of the victims on
the ship. The witnesses who affirmed that the victims were on the
ship were biased and unreliable.
This contention is without merit. Private respondent Ramon
Miranda testified that he personally took his family and his niece to
the vessel on the day of the voyage and stayed with them on the
ship until it was time for it to leave. There is no reason he should
claim members of his family to have perished in the accident just to
maintain an action. People do not normally lie about so grave a
matter as the loss of dear ones. It would be more difficult for
private respondents to keep the existence of their relatives if indeed
they are alive than it is for petitioner to show the
contrary. Petitioners only proof is that the bodies of the supposed
victims were not among those recovered from the site of the
mishap. But so were the bodies of the other passengers reported
[3]
missing not recovered, as this Court noted in the Mecenas case.
Private respondent Mirandas testimony was corroborated by
Edgardo Ramirez. Ramirez was a seminarian and one of the
survivors of the collision. He testified that he saw Mrs. Miranda and
Elfreda de la Victoria on the ship and that he talked with them. He
knew Mrs. Miranda who was his teacher in the grade school. He also
knew Elfreda who was his childhood friend and townmate. Ramirez
said he was with Mrs. Miranda and her children and niece from 7:00
p.m. until 10:00 p.m. when the collision happened and that he in
fact had dinner with them. Ramirez said he and Elfreda stayed on
the deck after dinner and it was there where they were jolted by the
collision of the two vessels. Recounting the moments after the
collision, Ramirez testified that Elfreda ran to fetch Mrs.
Miranda. He escorted her to the room and then tried to go back to
the deck when the lights went out. He tried to return to the cabin
but was not able to do so because it was dark and there was a
stampede of passengers from the deck.
Petitioner casts doubt on Ramirez testimony, claiming that Ramirez
could not have talked with the victims for about three hours and not
run out of stories to tell, unless Ramirez had a storehouse of
stories. But what is incredible about acquaintances thrown together
on a long journey staying together for hours on end, in idle
conversation precisely to while the hours away?
Petitioner also points out that it took Ramirez three (3) days before
he finally contacted private respondent Ramon Miranda to tell him
about the fate of his family. But it is not improbable that it took
Ramirez three days before calling on private respondent Miranda to
tell him about the last hours of Mrs. Miranda and her children and
niece, in view of the confusion in the days following the collision as
rescue teams and relatives searched for survivors.
Indeed, given the facts of this case, it is improper for petitioner to
even suggest that private respondents relatives did not board the
ill-fated vessel and perish in the accident simply because their
bodies were not recovered.
Second. In finding petitioner guilty of negligence and in failing to
exercise the extraordinary diligence required of it in the carriage of
passengers, both the trial court and the appellate court relied on the
findings of this Court in Mecenas v. Intermediate Appellate
[4]
Court, which case was brought for the death of other
passengers. In that case it was found that although the proximate
cause of the mishap was the negligence of the crew of the
M/T Tacloban City, the crew of the Don Juan was equally negligent
as it found that the latters master, Capt. Rogelio Santisteban, was
playing mahjong at the time of collision, and the officer on watch,

Senior Third Mate Rogelio De Vera, admitted that he failed to call

the attention of Santisteban to the imminent danger facing
them. This Court found that Capt. Santisteban and the crew of the
M/V Don Juan failed to take steps to prevent the collision or at least
delay the sinking of the ship and supervise the abandoning of the
ship.

Petitioner criticizes the lower courts reliance on the Mecenas case,

arguing that, although this case arose out of the same incident as
that involved in Mecenas, the parties are different and trial was
conducted separately. Petitioner contends that the decision in this
case should be based on the allegations and defenses pleaded and
evidence adduced in it or, in short, on the record of this case.

Petitioner Negros Navigation was found equally negligent in

tolerating the playing of mahjong by the ship captain and other crew
members while on board the ship and failing to keep the M/V Don
Juan seaworthy so much so that the ship sank within 10 to 15
minutes of its impact with the M/T Tacloban City.

The contention is without merit. What petitioner contends may be

true with respect to the merits of the individual claims against
petitioner but not as to the cause of the sinking of its ship on April
22, 1980 and its liability for such accident, of which there can only
be one truth. Otherwise, one would be subscribing to the
sophistry: truth on one side of the Pyrenees, falsehood on the
other!

In addition, the Court found that the Don Juan was overloaded. The
Certificate of Inspection, dated August 27, 1979, issued by the
Philippine Coast Guard Commander at Iloilo City stated that the total
number of persons allowed on the ship was 864, of whom 810 are
passengers, but there were actually 1,004 on board the vessel when
it sank, 140 persons more than the maximum number that could be
safely carried by it.
Taking these circumstances together, and the fact that the M/V Don
Juan, as the faster and better-equipped vessel, could have avoided a
collision with the PNOC tanker, this Court held that even if
the Tacloban City had been at fault for failing to observe an
internationally-recognized rule of navigation, the Don Juan was
guilty of contributory negligence. Through Justice Feliciano, this
Court held:
The grossness of the negligence of the Don Juan is underscored
when one considers the foregoing circumstances in the context of
the following facts: Firstly, the Don Juan was more than twice as
fast as the Tacloban City. The Don Juans top speed was 17
knots; while that of the Tacloban City was 6.3. knots. Secondly,
the Don Juan carried the full complement of officers and crew
members specified for a passenger vessel of her class. Thirdly, the
Don Juan was equipped with radar which was functioning that
night. Fourthly, the Don Juans officer on-watch had sighted the
Tacloban City on his radar screen while the latter was still four (4)
nautical miles away. Visual confirmation of radar contact was
established by the Don Juan while the Tacloban City was still 2.7
miles away. In the total set of circumstances which existed in the
instant case, the Don Juan, had it taken seriously its duty of
extraordinary diligence, could have easily avoided the collision with
the Tacloban City. Indeed, the Don Juan might well have
avoided the collision even if it had exercised ordinary diligence
merely.
It is true that the Tacloban City failed to follow Rule 18 of the
International Rules of the Road which requires two (2) power-driven
vessels meeting end on or nearly end on each to alter her course to
starboard (right) so that each vessel may pass on the port side (left)
of the other. The Tacloban City, when the two (2) vessels were
only three-tenths (0.3) of a mile apart, turned (for the second
o
time) 15 to port side while the Don Juan veered hard to
starboard. . . . *But+ route observance of the International Rules of
the Road will not relieve a vessel from responsibility if the collision
could have been avoided by proper care and skill on her part or even
by a departure from the rules.
In the petition at bar, the Don Juan having sighted the Tacloban
City when it was still a long way off was negligent in failing to take
early preventive action and in allowing the two (2) vessels to come
to such close quarters as to render the collision inevitable when
there was no necessity for passing so near to the Tacloban City as
to create that hazard or inevitability, for the Don Juan could
choose its own distance. It is noteworthy that the Tacloban City,
upon turning hard to port shortly before the moment of collision,
signalled its intention to do so by giving two (2) short blasts with its
horn. The Don Juan gave no answering horn blast to signal its
own intention and proceeded to turn hard to starboard.
We conclude that Capt. Santisteban and Negros Navigation are
properly held liable for gross negligence in connection with the
collision of the Don Juan and Tacloban City and the sinking of
[5]
the Don Juan leading to the death of hundreds of passengers. . . .

Adherence to the Mecenas case is dictated by this Courts policy of

maintaining stability in jurisprudence in accordance with the legal
maxim stare decisis et non quieta movere (Follow past precedents
and do not disturb what has been settled.) Where, as in this case,
the same questions relating to the same event have been put
forward by parties similarly situated as in a previous case litigated
and decided by a competent court, the rule of stare decisis is a bar
[6]
to any attempt to relitigate the same issue. In Woulfe v. Associated
[7]
Realties Corporation, the Supreme Court of New Jersey held that
where substantially similar cases to the pending case were
presented and applicable principles declared in prior decisions, the
court was bound by the principle of stare decisis. Similarly, in State
[8]
ex rel. Tollinger v. Gill, it was held that under the doctrine of stare
decisis a ruling is final even as to parties who are strangers to the
original proceeding and not bound by the judgment under the res
judicata doctrine. The Philadelphia court expressed itself in this
wise: Stare decisis simply declares that, for the sake of certainty, a
conclusion reached in one case should be applied to those which
follow, if the facts are substantially the same, even though the
[9]
parties may be different. Thus, in J. M. Tuason v.
Mariano, supra, this Court relied on its rulings in other cases
involving different parties in sustaining the validity of a land title on
the principle of stare decisis et non quieta movere.
Indeed, the evidence presented in this case was the same as those
presented in the Mecenas case, to wit:
Document
case

Mecenas
This case

Decision
[10]
10

of
Commandant
Exh. 11-B-NN/X

Exh.

Phil. Coast Guard in BMI Case

No. 415-80 dated 3/26/81
Decision
[11]
11

of

the
Exh. ZZ

Minister

Exh.

of National Defense dated 3/12/82

Resolution
[12]
13

on

the
Exh. AAA

for
the

motion

reconsideration

Exh.

of
(private respondents)

decision of the Minister of

National Defense dated 7/24/84
Certificate of
[13]
A

inspection
Exh. 19-NN

Exh.

1-

dated 8/27/79
Certificate
[14]
A

of

Stability
Exh. 19-D-NN

Exh.

6-

dated 12/16/76
Nor is it true that the trial court merely based its decision on
the Mecenas case. The trial court made its own independent
findings on the basis of the testimonies of witnesses, such as Senior
Third Mate Rogelio de Vera, who incidentally gave substantially the
same testimony on petitioners behalf before the Board of Marine
Inquiry. The trial court agreed with the conclusions of the then
Minister of National Defense finding both vessels to be negligent.
Third. The next issue is whether petitioner is liable to pay damages
notwithstanding the total loss of its ship. The issue is not one of first
impression. The rule is well-entrenched in our jurisprudence that a
shipowner may be held liable for injuries to passengers
notwithstanding the exclusively real and hypothecary nature of
[15]
maritime law if fault can be attributed to the shipowner.
In Mecenas, this Court found petitioner guilty of negligence in (1)
allowing or tolerating the ship captain and crew members in playing
mahjong during the voyage, (2) in failing to maintain the vessel
seaworthy and (3) in allowing the ship to carry more passengers
than it was allowed to carry. Petitioner is, therefore, clearly liable
for damages to the full extent.
Fourth. Petitioner contends that, assuming that the Mecenas case
applies, private respondents should be allowed to claim
only P43,857.14 each as moral damages because in
theMecenas case, the amount of P307,500.00 was awarded to the
seven children of the Mecenas couple. Under petitioners formula,
Ramon Miranda should receive P43,857.14, while the De la Victoria
spouses should receive P97,714.28.
Here is where the principle of stare decisis does not apply in view of
differences in the personal circumstances of the victims. For that
matter, differentiation would be justified even if private
respondents had joined the private respondents in
the Mecenas case. The doctrine of stare decisis works as a bar only
against issues litigated in a previous case. Where the issue involved
was not raised nor presented to the court and not passed upon by
the court in the previous case, the decision in the previous case is
[16]
not stare decisis of the question presently presented. The
decision in the Mecenas case relates to damages for which
petitioner was liable to the claimants in that case.
In the case at bar, the award of P300,000.00 for moral damages is
reasonable considering the grief petitioner Ramon Miranda suffered
as a result of the loss of his entire family. As a matter of fact, three
months after the collision, he developed a heart condition
undoubtedly caused by the strain of the loss of his
family. The P100,000.00 given to Mr. and Mrs. de la Victoria is
likewise reasonable and should be affirmed.
As for the amount of civil indemnity awarded to private
respondents, the appellate courts award of P50,000.00 per victim
should be sustained. The amount of P30,000.00 formerly set in De
[17]
Lima v. Laguna Tayabas Co., Heirs of Amparo delos Santos v.
[18]
Court of Appeals, and Philippine Rabbit Bus Lines, Inc. v.
[19]
Intermediate Appellate Court as benchmark was subsequently
increased to P50,000.00 in the case of Sulpicio Lines, Inc. v. Court of
[20]
Appeals, which involved the sinking of another interisland ship on
October 24, 1988.
We now turn to the determination of the earning capacity of the
victims. With respect to Ardita Miranda, the trial court awarded
[21]
damages computed as follows:
In the case of victim Ardita V. Miranda whose age at the time of the
accident was 48 years, her life expectancy was computed to be
21.33 years, and therefore, she could have lived up to almost 70
years old. Her gross earnings for 21.33 years based on P10,224.00
per annum, would be P218,077.92. Deducting therefrom 30% as her
living expenses, her net earnings would be P152,654.55, to which
plaintiff Ramon Miranda is entitled to compensatory damages for
the loss of earning capacity of his wife. In considering 30% as the
living expenses of Ardita Miranda, the Court takes into account the
fact that plaintiff and his wife were supporting their daughter and

son who were both college students taking Medicine and Law
respectively.
In accordance with the ruling in Villa-Rey Transit, Inc. v. Court of
[22]
Appeals, we think the life expectancy of Ardita Miranda was
correctly determined to be 21.33 years, or up to age 69. Petitioner
contends, however, that Mrs. Miranda would have retired from her
job as a public school teacher at 65, hence her loss of earning
capacity should be reckoned up to 17.33 years only.
The accepted formula for determining life expectancy
2
is /3 multiplied by (80 minus the age of the deceased). It may be
that in the Philippines the age of retirement generally is 65 but, in
calculating the life expectancy of individuals for the purpose of
determining loss of earning capacity under Art. 2206(1) of the Civil
Code, it is assumed that the deceased would have earned income
even after retirement from a particular job. In this case, the trial
court took into account the fact that Mrs. Miranda had a masters
degree and a good prospect of becoming principal of the school in
which she was teaching. There was reason to believe that her
income would have increased through the years and she could still
earn more after her retirement,e.g., by becoming a consultant, had
she not died. The gross earnings which Mrs. Miranda could
reasonably be expected to earn were it not for her untimely death
was, therefore, correctly computed by the trial court to
be P218,077.92 (given a gross annual income of P10,224.00 and life
expectancy of 21.33 years).
Petitioner contends that from the amount of gross earnings, 60%
should be deducted as necessary living expenses, not merely 30% as
the trial court allowed. Petitioner contends that 30% is unrealistic,
considering that Mrs. Mirandas earnings would have been subject
to taxes, social security deductions and inflation.
We agree with this contention. In Villa-Rey Transit, Inc. v. Court of
[23]
Appeals, the Court allowed a deduction of P1,184.00 for living
expenses from the P2,184.00 annual salary of the victim, which is
roughly 54.2% thereof. The deceased was 29 years old and a
training assistant in the Bacnotan Cement Industries. In People v.
[24]
Quilaton, the deceased was a 26-year old laborer earning a daily
wage. The court allowed a deduction of P120,000.00 which was
51.3% of his annual gross earnings of P234,000.00. In People v.
[25]
Teehankee, the court allowed a deduction of P19,800.00, roughly
42.4% thereof from the deceaseds annual salary of P46,659.21. The
deceased, Maureen Hultman, was 17 years old and had just received
her first paycheck as a secretary. In the case at bar, we hold that a
deduction of 50% from Mrs. Mirandas gross earnings (P218,077.92)
would be reasonable, so that her net earning capacity should
be P109,038.96. There is no basis for supposing that her living
expenses constituted a smaller percentage of her gross income than
the living expenses in the decided cases. To hold that she would
have used only a small part of her income for herself, a larger part
going to the support of her children would be conjectural and
unreasonable.
As for Elfreda de la Victoria, the trial court found that, at the time of
her death, she was 26 years old, a teacher in a private school in
Malolos, Bulacan, earning P6,192.00 per annum. Although a
probationary employee, she had already been working in the school
for two years at the time of her death and she had a general
efficiency rating of 92.85% and it can be presumed that, if not for
her untimely death, she would have become a regular
teacher. Hence, her loss of earning capacity is P111,456.00,
computed as follows:
net earning capacity (x) = life expectancy x [ gross annual
income less reasonable & necessary living expenses (50%) ]
x

[ 2 (80-26) ] x

[P6,192.00

3
=
=

36

P111,456.00

3,096.00

P3,096.00]

On the other hand, the award of actual damages in the amount

of P23,075.00 was determined by the Court of Appeals on the basis
of receipts submitted by private respondents. This amount is
reasonable considering the expenses incurred by private respondent
Miranda in organizing three search teams to look for his family,
spending for transportation in going to places such as Batangas City
and Iloilo, where survivors and the bodies of other victims were
found, making long distance calls, erecting a monument in honor of
the four victims, spending for obituaries in the Bulletin Today and
for food, masses and novenas.

P150,000.00
as compensatory damages for wrongful
death of three (3) victims;

Petitioners contention that the expenses for the erection of a

monument and other expenses for memorial services for the victims
should be considered included in the indemnity for death awarded
to private respondents is without merit. Indemnity for death is
given to compensate for violation of the rights of the
[26]
deceased, i.e., his right to life and physical integrity. On the other
hand, damages incidental to or arising out of such death are for
pecuniary losses of the beneficiaries of the deceased.

To private respondents Spouses Ricardo and Virginia de la Victoria:

As for the award of attorneys fees, we agree with the Court of

Appeals that the amount of P40,000.00 for private respondent
Ramon Miranda and P15,000.00 for the de la Victoria spouses is
justified. The appellate court correctly held:
The Mecenas case cannot be made the basis for determining the
award for attorneys fees. The award would naturally vary or differ
in each case. While it is admitted that plaintiff-appellee Ramon
Miranda who is himself a lawyer, represented also plaintiffsappellees Dela Victoria spouses, we note that separate testimonial
evidence were adduced by plaintiff-appellee Ramon Miranda (TSN,
February 26, 1982, p. 6) and plaintiffs-appellees spouses Dela
Victoria (TSN, August 13, 1981, p. 43). Considering the amount of
work and effort put into the case as indicated by the voluminous
transcripts of stenographic notes, we find no reason to disturb the
award of P40,000.00 for plaintiff-appellee Ramon Miranda
[27]
and P15,000.00 for plaintiffs-appellees Dela Victoria spouses.
The award of exemplary damages should be increased
to P300,000.00 for Ramon Miranda and P100,000.00 for the de la
Victoria spouses in accordance with our ruling in theMecenas case:
Exemplary damages are designed by our civil law to permit the
courts to reshape behaviour that is socially deleterious in its
consequence by creating negative incentives or deterrents against
such behaviour. In requiring compliance with the standard of
extraordinary diligence, a standard which is in fact that of the
highest possible degree of diligence, from common carriers and in
creating a presumption of negligence against them, the law seeks to
compel them to control their employees, to tame their reckless
instincts and to force them to take adequate care of human beings
and their property. The Court will take judicial notice of the dreadful
regularity with which grievous maritime disasters occur in our
waters with massive loss of life. The bulk of our population is too
poor to afford domestic air transportation. So it is that
notwithstanding the frequent sinking of passenger vessels in our
waters, crowds of people continue to travel by sea. This Court is
prepared to use the instruments given to it by the law for securing
the ends of law and public policy. One of those instruments is the
institution of exemplary damages; one of those ends, of special
importance in an archipelagic state like the Philippines, is the safe
[28]
and reliable carriage of people and goods by sea.
WHEREFORE, the decision of the Court of Appeals is AFFIRMED with
modification and petitioner is ORDERED to pay private respondents
damages as follows:
To private respondent Ramon Miranda:
P23,075.00

for actual damages;

P109,038.96
as compensatory damages for loss of
earning capacity of his wife;

P300,000.00

as moral damages;

P300,000.00
as exemplary damages, all in the total
amount of P882,113.96; and
P40,000.00

P12,000.00
P111,456.00
earning capacity;

as attorneys fees.

for actual damages;

as compensatory damages for loss of

P50,000.00
death;

as compensatory damages for wrongful

P100,000.00

as moral damages;

P100,000.00
as exemplary damages, all in the total
amount of P373,456.00; and
P15,000.00

as attorneys fees.

Petitioners are further ordered to pay costs of suit.

In the event the Philippine National Oil Company and/or the PNOC
Shipping and Transport Corporation pay or are required to pay all or
a portion of the amounts adjudged, petitioner Negros Navigation
Co., Inc. shall reimburse either of them such amount or amounts as
either may have paid, and in the event of failure of Negros
Navigation Co., Inc., to make the necessary reimbursement, PNOC
and/or PNOC/STC shall be entitled to a writ of execution without
need of filing another action.
SO ORDERED.

SO ORDERED.