CASUALTY INSURANCE

1. Authorized Drivers Clause

PERLA COMPANIA DE SEGUROS, INC. petitioner,
vs.
THE COURT OF APPEALS, HERMINIO LIM and EVELYN LIM, respondents.
G.R. No. 96493 May 7, 1992
FCP CREDIT CORPORATION, petitioner,
vs.
THE COURT OF APPEALS, Special Third Division, HERMINIO LIM and EVELYN LIM,
respondents.
Facts::
On December 24, 1981, private respondents spouses Herminio and Evelyn Lim executed a promissory
note in favor Supercars, Inc. in the sum of P77,940.00, payable in monthly installments according to the
schedule of payment indicated in said note, and secured by a chattel mortgage over a brand new red
Ford Laser 1300 5DR Hatchback 1981 model with motor and serial No. SUPJYK-03780, which is
registered under the name of private respondent Herminio Lim and insured with the petitioner Perla
Compania de Seguros, Inc. (Perla for brevity) for comprehensive coverage under Policy No.
PC/41PP QCB-43383. On the same date, Supercars, Inc., with notice to private respondents
spouses, assigned to petitioner FCP Credit Corporation (FCP for brevity) its rights, title and
interest on said promissory note and chattel mortgage as shown by the Deed of Assignment.
Said vehicle was carnapped while parked at the back of Broadway Centrum along N. Domingo Street,
Quezon City. Private respondent Evelyn Lim, who was driving said car before it was carnapped,
immediately called up the Anti-Carnapping Unit of the Philippine Constabulary to report said incident and
thereafter, went to the nearest police substation at Araneta, Cubao to make a police report regarding said
incident, as shown by the certification issued by the Quezon City police. On November 10, 1982, private
respondent Evelyn Lim reported said incident to the Land Transportation Commission in Quezon City, as
shown by the letter of her counsel to said office, in compliance with the insurance requirement. She also
filed a complaint with the Headquarters, Constabulary Highway Patrol Group.
On November 11, 1982, private respondent filed a claim for loss with the petitioner Perla but said
claim was denied on November 18, 1982 10 on the ground that Evelyn Lim, who was using the
vehicle before it was carnapped, was in possession of an expired driver's license at the time of the
loss of said vehicle which is in violation of the authorized driver clause of the insurance policy.
Private respondents requests from petitioner FCP for a suspension of payment on the monthly
amortization agreed upon due to the loss of the vehicle and, since the carnapped vehicle insured with
petitioner Perla, said insurance company should be made to pay the remaining balance of the promissory
note and the chattel mortgage contract. Perla, however, denied private respondents' claim. Consequently,
petitioner FCP demanded that private respondents pay the whole balance of the promissory note or to
return the vehicle 12 but the latter refused.
Petitioner FCP filed a complaint against private respondents, who in turn filed an amended third party
complaint against petitioner Perla.
We find no merit in Perla's petition.
The comprehensive motor car insurance policy issued by petitioner Perla undertook to indemnify the
private respondents against loss or damage to the car (a) by accidental collision or overturning, or
collision or overturning consequent upon mechanical breakdown or consequent upon wear and tear; (b)
by fire, external explosion, self-ignition or lightning or burglary, housebreaking or theft; and (c) by
malicious act.
Where a car is admittedly, as in this case, unlawfully and wrongfully taken without the owner's consent or
knowledge, such taking constitutes theft, and, therefore, it is the "THEFT"' clause, and not the

"AUTHORIZED DRIVER" clause that should apply. As correctly stated by the respondent court in its
decision:
Clearly, the risk against accident is distinct from the risk against theft. The "authorized driver clause" in a
typical insurance policy is in contemplation or anticipation of accident in the legal sense in which it should
be understood, and not in contemplation or anticipation of an event such as theft. The distinction often
seized upon by insurance companies in resisting claims from their assureds between death occurring
as a result of accident and death occurring as a result of intent may, by analogy, apply to the case at bar.
Thus, if the insured vehicle had figured in an accident at the time she drove it with an expired license,
then, appellee Perla Compania could properly resist appellants' claim for indemnification for the loss or
destruction of the vehicle resulting from the accident. But in the present case. The loss of the insured
vehicle did not result from an accident where intent was involved; the loss in the present case was caused
by theft, the commission of which was attended by intent. 15
It is worthy to note that there is no causal connection between the possession of a valid driver's license
and the loss of a vehicle. To rule otherwise would render car insurance practically a sham since an
insurance company can easily escape liability by citing restrictions which are not applicable or germane to
the claim, thereby reducing indemnity to a shadow.
We however find the petition of FCP meritorious.
This Court agrees with petitioner FCP that private respondents are not relieved of their obligation to pay
the former the installments due on the promissory note on account of the loss of the automobile. The
chattel mortgage constituted over the automobile is merely an accessory contract to the promissory note.
Being the principal contract, the promissory note is unaffected by whatever befalls the subject matter of
the accessory contract. Therefore, the unpaid balance on the promissory note should be paid, and not
just the installments due and payable before the automobile was carnapped, as erronously held by the
Court of Appeals.
However, this does not mean that private respondents are bound to pay the interest, litigation expenses
and attorney's fees stipulated in the promissory note. Because of the peculiar relationship between the
three contracts in this case, i.e., the promissory note, the chattel mortgage contract and the insurance
policy, this Court is compelled to construe all three contracts as intimately interrelated to each other,
despite the fact that at first glance there is no relationship whatsoever between the parties thereto.
Under the promissory note, private respondents are obliged to pay Supercars, Inc. the amount stated
therein in accordance with the schedule provided for. To secure said promissory note, private respondents
constituted a chattel mortgage in favor of Supercars, Inc. over the automobile the former purchased from
the latter. The chattel mortgage, in turn, required private respondents to insure the automobile and to
make the proceeds thereof payable to Supercars, Inc. The promissory note and chattel mortgage were
assigned by Supercars, Inc. to petitioner FCP, with the knowledge of private respondents. Private
respondents were able to secure an insurance policy from petitioner Perla, and the same was made
specifically payable to petitioner FCP. The insurance policy was therefore meant to be an additional
security to the principal contract, that is, to insure that the promissory note will still be paid in case the
automobile is lost through accident or theft. The Chattel Mortgage Contract provided that:
It is clear from the abovementioned provision that upon the loss of the insured vehicle, the insurance
company Perla undertakes to pay directly to the mortgagor or to their assignee, FCP, the
outstanding balance of the mortgage at the time of said loss under the mortgage contract. If the
claim on the insurance policy had been approved by petitioner Perla, it would have paid the
proceeds thereof directly to petitioner FCP, and this would have had the effect of extinguishing
private respondents' obligation to petitioner FCP. Therefore, private respondents were justified in
asking petitioner FCP to demand the unpaid installments from petitioner Perla.
Because petitioner Perla had unreasonably denied their valid claim, private respondents should
not be made to pay the interest, liquidated damages and attorney's fees as stipulated in the
promissory note. As mentioned above, the contract of indemnity was procured to insure the
return of the money loaned from petitioner FCP, and the unjustified refusal of petitioner Perla to
recognize the valid claim of the private respondents should not in any way prejudice the latter.

Private respondents can not be said to have unduly enriched themselves at the expense of petitioner FCP
since they will be required to pay the latter the unpaid balance of its obligation under the promissory note.
In view of the foregoing discussion, We hold that the Court of Appeals did not err in requiring petitioner
Perla to indemnify private respondents for the loss of their insured vehicle. However, the latter should be
ordered to pay petitioner FCP the amount of P55,055.93, representing the unpaid installments from
December 30, 1982 up to July 1, 1983, as shown in the statement of account prepared by petitioner FCP,
plus legal interest from July 2, 1983 until fully paid.
As to the award of moral damages, exemplary damages and attorney's fees, private respondents are
legally entitled to the same since petitioner Perla had acted in bad faith by unreasonably refusing to
honor the insurance claim of the private respondents.
WHEREFORE, the assailed decision of the Court of Appeals is hereby MODIFIED to require private
respondents to pay petitioner FCP the amount of P55,055.93, with legal interest from July 2, 1983
until fully paid. The decision appealed from is hereby affirmed as to all other respects. No
pronouncement as to costs.
2. Authorized Driver
G.R. No. L-36480 May 31, 1988
ANDREW PALERMO, plaintiff-appellee,
vs.
PYRAMID INSURANCE CO., INC., defendant- appellant.
Facts:
After having purchased a brand new Nissan Cedric de Luxe Sedan car, plaintiff insured the same with
the defendant insurance company against any loss or damage for P 20,000.00 and against third
party liability for P 10,000.00. Plaintiff paid the defendant P 361.34 premium for one year, March 12,
1968 to March 12, 1969. The automobile was, however, mortgaged by the plaintiff with the vendor,
Ng Sam Bok Motors Co., to secure the payment of the balance of the purchase price, which
explains why the registration certificate in the name of the plaintiff remains in the hands of the mortgagee,
Ng Sam Bok Motors Co. While driving the automobile in question, the plaintiff met a violent accident.
The car in question was totally wrecked. The defendant was immediately notified of the occurrence.
The insurance policy, grants an option unto the defendant, in case of accident either to indemnify
the plaintiff for loss or damage to the car in cash or to replace the damaged car. The defendant,
however, refused to take either of the above-mentioned alternatives for the reason as alleged, that the
insured himself had violated the terms of the policy when he drove the car in question with an expired
driver's license.
AUTHORIZED DRIVER:
Any of the following:
(a) The Insured.
(b) Any person driving on the Insured's order or with his permission. Provided that the person driving is
permitted in accordance with the licensing or other laws or regulations to drive the Motor Vehicle and is
not disqualified from driving such motor vehicle by order of a Court of law or by reason of any enactment
or regulation in that behalf.
There is no merit in the appellant's allegation that the plaintiff was not authorized to drive the insured
motor vehicle because his driver's license had expired. The driver of the insured motor vehicle at the time
of the accident was, the insured himself, hence an "authorized driver" under the policy.
While the Motor Vehicle Law prohibits a person from operating a motor vehicle on the highway
without a license or with an expired license, an infraction of the Motor Vehicle Law on the part of
the insured, is not a bar to recovery under the insurance contract. It however renders him subject
to the penal sanctions of the Motor Vehicle Law.
The requirement that the driver be "permitted in accordance with the licensing or other laws or
regulations to drive the Motor Vehicle and is not disqualified from driving such motor vehicle by

order of a Court of Law or by reason of any enactment or regulation in that behalf," applies only
when the driver" is driving on the insured's order or with his permission." It does not apply when
the person driving is the insured himself.
This view may be inferred from the decision of this Court in Villacorta vs. Insurance Commission,
100 SCRA 467, where it was held that:
The main purpose of the "authorized driver" clause, as may be seen from its text, is that a person
other than the insured owner, who drives the car on the insured's order, such as his regular driver,
or with his permission, such as a friend or member of the family or the employees of a car service
or repair shop, must be duly licensed drivers and have no disqualification to drive a motor
vehicle.
In an American case, where the insured herself was personally operating her automobile but without a
license to operate it, her license having expired prior to the issuance of the policy, the
Supreme Court of Massachusetts was more explicit:
... Operating an automobile on a public highway without a license, which act is a statutory crime is not
precluded by public policy from enforcing a policy indemnifying her against liability for bodily injuries The
inflicted by use of the automobile." (Drew C. Drewfield McMahon vs. Hannah
Pearlman, et al., 242 Mass. 367, 136 N.E. 154, 23 A.L.R. 1467.)
WHEREFORE, the appealed decision is affirmed with costs against the defendant-appellant.
3. Third Party Liability
G.R. No. L-52756 October 12, 1987
MANILA MAHOGANY MANUFACTURING CORPORATION, petitioner,
vs.
COURT OF APPEALS AND ZENITH INSURANCE CORPORATION, respondents.
Facts:
From 6 March 1970 to 6 March 1971, petitioner insured its Mercedes Benz 4-door sedan with
respondent insurance company. On 4 May 1970 the insured vehicle was bumped and damaged by a
truck owned by San Miguel Corporation. For the damage caused, respondent company paid petitioner
five thousand pesos (P5,000.00) in amicable settlement. Petitioner's general manager executed a
Release of Claim, subrogating respondent company to all its right to action against San Miguel
Corporation.
On 11 December 1972, respondent company wrote Insurance Adjusters, Inc. to demand reimbursement
from San Miguel Corporation of the amount it had paid petitioner. Insurance Adjusters, Inc. refused
reimbursement, alleging that San Miguel Corporation had already paid petitioner P4,500.00 for the
damages to petitioner's motor vehicle, as evidenced by a cash voucher and a Release of Claim executed
by the General Manager of petitioner discharging San Miguel Corporation from "all actions, claims,
demands the rights of action that now exist or hereafter [sic] develop arising out of or as a consequence
of the accident."
Respondent insurance company thus demanded from petitioner reimbursement of the sum of
P4,500.00 paid by San Miguel Corporation. Petitioner refused; hence, respondent company filed suit in
the City Court of Manila for the recovery of P4,500.00. The City Court ordered petitioner to pay
respondent P4,500.00. On appeal the Court of First Instance of Manila affirmed the City
Court's decision in toto, which CFI decision was affirmed by the Court of Appeals, with the modification
that petitioner was to pay respondent the total amount of P5,000.00 that it had earlier received from the
respondent insurance company.
Petitioner now contends it is not bound to pay P4,500.00, and much more, P5,000.00 to respondent
company as the subrogation in the Release of Claim it executed in favor of respondent was conditioned
on recovery of the total amount of damages petitioner had sustained.
Since total damages were valued by petitioner at P9,486.43 and only P5,000.00 was received by
petitioner from respondent, petitioner argues that it was entitled to go after San Miguel Corporation to
claim the additional P4,500.00 eventually paid to it by the latter, without having to turn over said amount to

respondent. Respondent of course disputes this allegation and states that there was no qualification to its
right of subrogation under the Release of Claim executed by petitioner, the contents of said deed having
expressed all the intents and purposes of the parties.
To support its alleged right not to return the P4,500.00 paid by San Miguel Corporation, petitioner cites
Art. 2207 of the Civil Code, which states:
If the plaintiff's property has been insured, and he has received indemnity from the insurance company for
the injury or loss arising out of the wrong or breach of contract complained of the insurance company
shall be subrogated to the rights of the insured against the wrongdoer or the person who has violated the
contract. If the amount paid by the insurance company does not fully cover the injury or loss the
aggrieved party shall be entitled to recover the deficiency from the person causing the loss or injury.
Petitioner also invokes Art. 1304 of the Civil Code, stating.
A creditor, to whom partial payment has been made, may exercise his right for the remainder, and he shall
be preferred to the person who has been subrogated in his place in virtue of the partial payment of the
same credit.
We find petitioners arguments to be untenable and without merit. In the absence of any other evidence to
support its allegation that a gentlemen's agreement existed between it and respondent, not embodied in
the Release of Claim, such ease of Claim must be taken as the best evidence of the intent and purpose of
the parties. Thus, the Court of Appeals rightly stated:
Petitioner argues that the release claim it executed subrogating Private respondent to any right of action it
had against San Miguel Corporation did not preclude Manila Mahogany from filing a deficiency claim
against the wrongdoer. Citing Article 2207, New Civil Code, to the effect that if the amount paid by an
insurance company does not fully cover the loss, the aggrieved party shall be entitled to recover the
deficiency from the person causing the loss, petitioner claims a preferred right to retain the amount
coming from San Miguel Corporation, despite the subrogation in favor of Private respondent.
Although petitioners right to file a deficiency claim against San Miguel Corporation is with legal basis,
without prejudice to the insurer's right of subrogation, nevertheless when Manila Mahogany executed
another release claim (Exhibit K) discharging San Miguel Corporation from "all actions, claims, demands
and rights of action that now exist or hereafter arising out of or as a consequence of the accident" after
the insurer had paid the proceeds of the policy- the compromise agreement of P5,000.00 being based on
the insurance policy-the insurer is entitled to recover from the insured the amount of insurance money
paid (Metropolitan Casualty Insurance Company of New York vs. Badler, 229 N.Y.S. 61, 132 Misc. 132
cited in Insurance Code and Insolvency Law with comments and annotations, H.B. Perez 1976, p. 151).
Since petitioner by its own acts released San Miguel Corporation, thereby defeating private respondents,
the right of subrogation, the right of action of petitioner against the insurer was also nullified. (Sy Keng &
Co. vs. Queensland Insurance Co., Ltd., 54 O.G. 391) Otherwise stated: private respondent may recover
the sum of P5,000.00 it had earlier paid to petitioner. 1
As held in Phil. Air Lines v. Heald Lumber Co., 2
If a property is insured and the owner receives the indemnity from the insurer, it is provided in [Article
2207 of the New Civil Code] that the insurer is deemed subrogated to the rights of the insured against the
wrongdoer and if the amount paid by the insurer does not fully cover the loss, then the aggrieved party is
the one entitled to recover the deficiency. ... Under this legal provision, the real party in interest with
regard to the portion of the indemnity paid is the insurer and not the insured 3 (Emphasis supplied)
The decision of the respondent court ordering petitioner to pay respondent company, not the P4,500.00
as originally asked for, but P5,000.00, the amount respondent company paid petitioner as insurance, is
also in accord with law and jurisprudence. In disposing of this issue, the Court of Appeals held:
... petitioner is entitled to keep the sum of P4,500.00 paid by San Miguel Corporation under its clear right
to file a deficiency claim for damages incurred, against the wrongdoer, should the insurance company not
fully pay for the injury caused (Article 2207, New Civil Code). However, when petitioner released San
Miguel Corporation from any liability, petitioner's right to retain the sum of P5,000.00 no longer existed,
thereby entitling private respondent to recover the same.
(Emphasis supplied)
As has been observed:
... The right of subrogation can only exist after the insurer has paid the otherwise the insured will
be deprived of his right to full indemnity. If the insurance proceeds are not sufficient to cover the
damages suffered by the insured, then he may sue the party responsible for the damage for the

the [sic] remainder. To the extent of the amount he has already received from the insurer enjoy's
[sic] the right of subrogation.
Since the insurer can be subrogated to only such rights as the insured may have, should the insured,
after receiving payment from the insurer, release the wrongdoer who caused the loss, the insurer loses
his rights against the latter. But in such a case, the insurer will be entitled to recover from the insured
whatever it has paid to the latter, unless the release was made with the consent of the insurer. 4
(Emphasis supplied.)
And even if the specific amount asked for in the complaint is P4,500.00 only and not P5,000.00, still, the
respondent Court acted well within its discretion in awarding P5,000.00, the total amount paid by the
insurer. The Court of Appeals rightly reasoned as follows: It is to be noted that private respondent, in its
companies, prays for the recovery, not of P5,000.00 it had paid under the insurance policy but P4,500.00
San Miguel Corporation had paid to petitioner. On this score, We believe the City Court and Court of First
Instance erred in not awarding the proper relief. Although private respondent prays for the reimbursement
of P4,500.00 paid by San Miguel Corporation, instead of P5,000.00 paid under the insurance policy, the
trial court should have awarded the latter, although not prayed for, under the general prayer in the
complaint "for such further or other relief as may be deemed just or equitable, (Rule 6, Sec. 3,
Revised Rules of Court; Rosales vs. Reyes Ordoveza, 25 Phil. 495 ; Cabigao vs. Lim, 50 Phil. 844;
Baguiro vs. Barrios Tupas, 77 Phil 120).
WHEREFORE, premises considered, the petition is DENIED. The judgment appealed from is hereby
AFFIRMED with costs against petitioner.
4. Third Party Liability
G.R. No. 78848 November 14, 1988
SHERMAN SHAFER, petitioner,
vs.
HON. JUDGE, REGIONAL TRIAL COURT OF OLONGAPO CITY, BRANCH 75, and MAKATI
INSURANCE COMPANY, INC., respondents.
R.M. Blanco for petitioner.
Facts:
Petitioner Sherman Shafer obtained a private car policy, GA No. 0889, 2 over his Ford Laser car with
Plate No. CFN-361 from Makati Insurance Company, Inc., for third party liability (TPL).<re||an1w>
During the effectivity of the policy, an information 3 for reckless imprudence resulting in damage to
property and serious physical injuries was filed against petitioner.
The owner of the damaged Volkswagen car filed a separate civil action against petitioner for damages,
while Jovencio Poblete, Sr., who was a passenger in the Volkswagen car when allegedly hit and bumped
by the car driven by petitioner, did not reserve his right to file a separate civil action for damages. Instead,
in the course of the trial in the criminal case, Poblete, Sr. testified on his claim for damages for the serious
physical injuries which he claimed to have sustained as a result of the accident.
Upon motion, petitioner was granted leave by the former presiding judge of the trail court to file a third
party complaint against the herein private respondent, Makati Insurance Company, Inc. Said insurance
company, however, moved to vacate the order granting leave to petitioner to file a third party complaint
against it and/or to dismiss the same. On 24 April 1987, the court a quo issued an order dismissing the
third party complaint on the ground that it was premature, based on the premise that unless the accused
(herein petitioner) is found guilty and sentenced to pay the offended party (Poblete Sr.) indemnity or
damages, the third party complaint is without cause of action. The court further stated that the better
procedure is for the accused (petitioner) to wait for the outcome of the criminal aspect of the case to
determine whether or not the accused, also the third party plaintiff, has a cause of action against the third
party defendant for the enforcement of its third party liability (TPL) under the insurance contract. 6
Petitioner moved for reconsideration of said order, but the motion was denied; 7 hence, this petition.
It is the contention of herein petitioner that the dismissal of the third party complaint amounts to a denial
or curtailment of his right to defend himself in the civil aspect of the case. Petitioner further raises the
legal question of whether the accused in a criminal action for reckless imprudence, where the civil action

is jointly prosecuted, can legally implead the insurance company as third party defendant under its private
car insurance policy, as one of his modes of defense in the civil aspect of said proceedings.
On the other hand, the insurance company submits that a third party complaint is, under the rules,
available only if the defendant has a right to demand contribution, indemnity, subrogation or any other
relief in respect of plaintiff's claim, to minimize the number of lawsuits and avoid the necessity of bringing
two (2) or more suits involving the same subject matter. The insurance company further contends that the
contract of motor vehicle insurance, the damages and attorney's fees claimed by accused/third party
plaintiff are matters entirely different from his criminal liability in the reckless imprudence case, and that
petitioner has no cause of action against the insurer until petitioner's liability shall have been determined
by final judgment, as stipulated in the contract of insurance. 8
Compulsory Motor Vehicle Liability Insurance (third party liability, or TPL) is primarily intended to provide
compensation for the death or bodily injuries suffered by innocent third parties or passengers as a result
of a negligent operation and use of motor vehicles. 9 The victims and/or their dependents are assured of
immediate financial assistance, regardless of the financial capacity of motor vehicle owners.
The liability of the insurance company under the Compulsory Motor Vehicle Liability Insurance is for loss
or damage. Where an insurance policy insures directly against liability, the insurer's liability accrues
immediately upon the occurrence of the injury or event upon which the liability depends, and does not
depend on the recovery of judgment by the injured party against the insured. 10
The injured for whom the contract of insurance is intended can sue directly the insurer. The general
purpose of statutes enabling an injured person to proceed directly against the insurer is to protect injured
persons against the insolvency of the insured who causes such injury, and to give such injured person a
certain beneficial interest in the proceeds of the policy, and statutes are to be liberally construed so that
their intended purpose may be accomplished. It has even been held that such a provision creates a
contractual relation which inures to the benefit of any and every person who may be negligently injured by
the named insured as if such injured person were specifically named in the policy. 11
In the event that the injured fails or refuses to include the insurer as party defendant in his claim for
indemnity against the insured, the latter is not prevented by law to avail of the procedural rules intended
to avoid multiplicity of suits. Not even a "no action" clause under the policy-which requires that a final
judgment be first obtained against the insured and that only thereafter can the person insured recover on
the policy can prevail over the Rules of Court provisions aimed at avoiding multiplicity of suits. 12
In the instant case, the court a quo erred in dismissing petitioner's third party complaint on the ground that
petitioner had no cause of action yet against the insurance company (third party defendant). There is no
need on the part of the insured to wait for the decision of the trial court finding him guilty of reckless
imprudence. The occurrence of the injury to the third party immediately gave rise to the liability of the
insurer under its policy.
A third party complaint is a device allowed by the rules of procedure by which the defendant can bring into
the original suit a party against whom he will have a claim for indemnity or remuneration as a result of a
liability established against him in the original suit. 13 Third party complaints are allowed to minimize the
number of lawsuits and avoid the necessity of bringing two (2) or more actions involving the same subject
matter. They are predicated on the need for expediency and the avoidance of unnecessary lawsuits. If it
appears probable that a second action will result if the plaintiff prevails, and that this result can be avoided
by allowing the third party complaint to remain, then the motion to dismiss the third party complaint should
be denied. 14
Respondent insurance company's contention that the third party complaint involves extraneous matter
which will only clutter, complicate and delay the criminal case is without merit. An offense causes two (2)
classes of injuries the first is the social injury produced by the criminal act which is sought to be repaired
thru the imposition of the corresponding penalty, and the second is the personal injury caused to the
victim of the crime, which injury is sought to be compensated thru indemnity, which is civil in nature. 15
In the instant case, the civil aspect of the offense charged, i.e., serious physical injuries allegedly suffered
by Jovencio Poblete, Sr., was impliedly instituted with the criminal case. Petitioner may thus raise all
defenses available to him insofar as the criminal and civil aspects of the case are concerned. The
claim of petitioner for payment of indemnity to the injured third party, under the insurance policy,
for the alleged bodily injuries caused to said third party, arose from the offense charged in the
criminal case, from which the injured (Jovencio Poblete, Sr.) has sought to recover civil damages.
Hence, such claim of petitioner against the insurance company cannot be regarded as not related
to the criminal action.

WHEREFORE, the instant petition is GRANTED. The questioned order dated 24 April 1987 is
SET ASIDE and a new one entered admitting petitioner's third party complaint against the private
respondent Makati Insurance Company, Inc.
5.
G.R. No. L-36413 September 26, 1988
MALAYAN INSURANCE CO., INC., petitioner,
vs.
THE HON. COURT OF APPEALS (THIRD DIVISION) MARTIN C. VALLEJOS, SIO CHOY, SAN
LEON RICE MILL, INC. and PANGASINAN TRANSPORTATION CO., INC., respondents.
Freqillana Jr. for petitioner.
Facts:
Petitioner, Malayan Insurance Co., Inc., issued in favor of private respondent Sio Choy Private Car
Comprehensive Policy No. MRO/PV-15753, effective from 18 April 1967 to 18 April 1968, covering a
Willys jeep with Motor No. ET-03023 Serial No. 351672, and Plate No. J-21536, Quezon City, 1967. The
insurance coverage was for "own damage" not to exceed P600.00 and "third-party liability" in the
amount of P20,000.00. During the effectivity of said insurance policy, the insured jeep, while being driven
by one Juan P. Campollo an employee of the respondent San Leon Rice Mill, Inc., collided with a
passenger bus belonging to the respondent Pangasinan Transportation Co., Inc. (PANTRANCO, for
short), causing damage to the insured vehicle and injuries to the driver, Juan P. Campollo, and the
respondent Martin C. Vallejos, who was riding in the ill-fated jeep.
As a result, Martin C. Vallejos filed an action for damages against Sio Choy, Malayan Insurance
Co., Inc. and the PANTRANCO before the Court of First Instance of Pangasinan, which was docketed as
Civil Case No. U-2021. He prayed therein that the defendants be ordered to pay him, jointly and severally,
the amount of P15,000.00, as reimbursement for medical and hospital expenses; P6,000.00, for lost
income; P51,000.00 as actual, moral and compensatory damages; and P5,000.00, for attorney's fees.
Answering, PANTRANCO claimed that the jeep of Sio Choy was then operated at an excessive speed
and bumped the PANTRANCO bus which had moved to, and stopped at, the shoulder of the highway in
order to avoid the jeep; and that it had observed the diligence of a good father of a family to prevent
damage, especially in the selection and supervision of its employees and in the maintenance of its motor
vehicles. It prayed that it be absolved from any and all liability.
Defendant Sio Choy and the petitioner insurance company, in their answer, also denied liability to the
plaintiff, claiming that the fault in the accident was solely imputable to the PANTRANCO. Sio Choy,
however, later filed a separate answer with a cross-claim against the herein petitioner wherein he alleged
that he had actually paid the plaintiff, Martin C. Vallejos, the amount of P5,000.00 for hospitalization and
other expenses, and, in his cross-claim against the herein petitioner, he alleged that the petitioner had
issued in his favor a private car comprehensive policy wherein the insurance company obligated itself to
indemnify Sio Choy, as insured, for the damage to his motor vehicle, as well as for any liability to third
persons arising out of any accident during the effectivity of such insurance contract, which policy was in
full force and effect when the vehicular accident complained of occurred. He prayed that he be
reimbursed by the insurance company for the amount that he may be ordered to pay.
Also later, the herein petitioner sought, and was granted, leave to file a third-party complaint against the
San Leon Rice Mill, Inc. for the reason that the person driving the jeep of Sio Choy, at the time of the
accident, was an employee of the San Leon Rice Mill, Inc. performing his duties within the scope of his
assigned task, and not an employee of Sio Choy; and that, as the San
Leon Rice Mill, Inc. is the employer of the deceased driver, Juan P. Campollo, it should be liable for the
acts of its employee, pursuant to Art. 2180 of the Civil Code. The herein petitioner prayed that judgment
be rendered against the San Leon Rice Mill, Inc., making it liable for the amounts claimed by the plaintiff
and/or ordering said San Leon Rice Mill, Inc. to reimburse and indemnify the petitioner for any sum that it
may be ordered to pay the plaintiff.
After trial, judgment was rendered as follows:
WHEREFORE, in view of the foregoing findings of this Court judgment is hereby rendered in favor of the
plaintiff and against Sio Choy and Malayan Insurance Co., Inc., and third-party defendant San Leon Rice
Mill, Inc., as follows:
(a) P4,103 as actual damages;

(b) P18,000.00 representing the unearned income of plaintiff Martin C. Vallejos for the period
of three (3) years;
(c) P5,000.00 as moral damages;
(d) P2,000.00 as attomey's fees or the total of P29,103.00, plus costs.
The above-named parties against whom this judgment is rendered are hereby held jointly and severally
liable. With respect, however, to Malayan Insurance Co., Inc., its liability will be up to only P20,000.00.
As no satisfactory proof of cost of damage to its bus was presented by defendant Pantranco, no award
should be made in its favor. Its counter-claim for attorney's fees is also dismissed for not being proved. 1
On appeal, the respondent Court of Appeals affirmed the judgment of the trial court that Sio Choy, the
San Leon Rice Mill, Inc. and the Malayan Insurance Co., Inc. are jointly and severally liable for the
damages awarded to the plaintiff Martin C. Vallejos. It ruled, however, that the San Leon Rice Mill, Inc.
has no obligation to indemnify or reimburse the petitioner insurance company for whatever amount it has
been ordered to pay on its policy, since the San Leon Rice Mill, Inc. is not a privy to the contract of
insurance between Sio Choy and the insurance company. 2
Hence, the present recourse by petitioner insurance company.
The petitioner prays for the reversal of the appellate court's judgment, or, in the alternative, to order the
San Leon Rice Mill, Inc. to reimburse petitioner any amount, in excess of one-half (1/2) of the entire
amount of damages, petitioner may be ordered to pay jointly and severally with Sio Choy.
The Court, acting upon the petition, gave due course to the same, but "only insofar as it concerns the
alleged liability of respondent San Leon Rice Mill, Inc. to petitioner, it being understood that no other
aspect of the decision of the Court of Appeals shall be reviewed, hence, execution may already issue in
favor of respondent Martin C. Vallejos against the respondents, without prejudice to the determination of
whether or not petitioner shall be entitled to reimbursement by respondent San Leon Rice Mill, Inc. for the
whole or part of whatever the former may pay on the P20,000.00 it has been adjudged to pay respondent
Vallejos." 3
However, in order to determine the alleged liability of respondent San Leon Rice Mill, Inc. to petitioner, it is
important to determine first the nature or basis of the liability of petitioner to respondent Vallejos, as
compared to that of respondents Sio Choy and San Leon Rice Mill, Inc. Therefore, the two (2) principal
issues to be resolved are (1) whether the trial court, as upheld by the Court of Appeals, was correct in
holding petitioner and respondents Sio Choy and San Leon Rice Mill, Inc. "solidarily liable" to respondent
Vallejos; and (2) whether petitioner is entitled to be reimbursed by respondent San Leon Rice Mill, Inc. for
whatever amount petitioner has been adjudged to pay respondent Vallejos on its insurance policy.
As to the first issue, it is noted that the trial court found, as affirmed by the appellate court, that petitioner
and respondents Sio Choy and San Leon Rice Mill, Inc. are jointly and severally liable to respondent
Vallejos.
We do not agree with the aforesaid ruling. We hold instead that it is only respondents Sio Choy and
San Leon Rice Mill, Inc, (to the exclusion of the petitioner) that are solidarily liable to respondent
Vallejos for the damages awarded to Vallejos.
It must be observed that respondent Sio Choy is made liable to said plaintiff as owner of the illfated
Willys jeep, pursuant to Article 2184 of the Civil Code which provides:
Art. 2184. In motor vehicle mishaps, the owner is solidarily liable with his driver, if the former, who was in
the vehicle, could have, by the use of due diligence, prevented the misfortune it is disputably presumed
that a driver was negligent, if he had been found guilty of reckless driving or violating traffic regulations at
least twice within the next preceding two months.
If the owner was not in the motor vehicle, the provisions of article 2180 are applicable.
On the other hand, it is noted that the basis of liability of respondent San Leon Rice Mill, Inc. to plaintiff
Vallejos, the former being the employer of the driver of the Willys jeep at the time of the motor vehicle
mishap, is Article 2180 of the Civil Code which reads:
Art. 2180. The obligation imposed by article 2176 is demandable not only for one's own acts or omissions,
but also for those of persons for whom one is responsible.
xxx xxx xxx
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 ill any business or
industry.
xxx xxx xxx

The responsibility treated in this article shall cease when the persons herein mentioned proved that they
observed all the diligence of a good father of a family to prevent damage.
It thus appears that respondents Sio Choy and San Leon Rice Mill, Inc. are the principal tortfeasors who
are primarily liable to respondent Vallejos. The law states that the responsibility of two or more persons
who are liable for a quasi-delict is solidarily. 4
On the other hand, the basis of petitioner's liability is its insurance contract with respondent Sio Choy. If
petitioner is adjudged to pay respondent Vallejos in the amount of not more than P20,000.00, this is on
account of its being the insurer of respondent Sio Choy under the third party liability clause included in the
private car comprehensive policy existing between petitioner and respondent Sio Choy at the time of the
complained vehicular accident.
In Guingon vs. Del Monte, 5 a passenger of a jeepney had just alighted therefrom, when he was bumped
by another passenger jeepney. He died as a result thereof. In the damage suit filed by the heirs of said
passenger against the driver and owner of the jeepney at fault as well as against the insurance company
which insured the latter jeepney against third party liability, the trial court, affirmed by this Court, adjudged
the owner and the driver of the jeepney at fault jointly and severally liable to the heirs of the victim in the
total amount of P9,572.95 as damages and attorney's fees; while the insurance company was sentenced
to pay the heirs the amount of P5,500.00 which was to be applied as partial satisfaction of the judgment
rendered against said owner and driver of the jeepney. Thus, in said Guingon case, it was only the owner
and the driver of the jeepney at fault, not including the insurance company, who were held solidarily liable
to the heirs of the victim.
While it is true that where the insurance contract provides for indemnity against liability to third persons,
such third persons can directly sue the insurer, 6 however, the direct liability of the insurer under
indemnity contracts against third party liability does not mean that the insurer can be held solidarily liable
with the insured and/or the other parties found at fault. The liability of the insurer is based on contract; that
of the insured is based on tort.
In the case at bar, petitioner as insurer of Sio Choy, is liable to respondent Vallejos, but it cannot, as
incorrectly held by the trial court, be made "solidarily" liable with the two principal tortfeasors namely
respondents Sio Choy and San Leon Rice Mill, Inc. For if petitioner-insurer were solidarily liable with said
two (2) respondents by reason of the indemnity contract against third party liabilityunder which an insurer
can be directly sued by a third party this will result in a violation of the principles underlying solidary
obligation and insurance contracts.
In solidary obligation, the creditor may enforce the entire obligation against one of the solidary debtors. 7
On the other hand, insurance is defined as "a contract whereby one undertakes for a consideration to
indemnify another against loss, damage, or liability arising from an unknown or contingent event." 8
In the case at bar, the trial court held petitioner together with respondents Sio Choy and San Leon
Rice Mills Inc. solidarily liable to respondent Vallejos for a total amount of P29,103.00, with the
qualification that petitioner's liability is only up to P20,000.00. In the context of a solidary obligation,
petitioner may be compelled by respondent Vallejos to pay the entire obligation of P29,013.00,
notwithstanding the qualification made by the trial court. But, how can petitioner be obliged to pay the
entire obligation when the amount stated in its insurance policy with respondent Sio Choy for indemnity
against third party liability is only P20,000.00? Moreover, the qualification made in the decision of the
trial court to the effect that petitioner is sentenced to pay up to P20,000.00 only when the
obligation to pay P29,103.00 is made solidary, is an evident breach of the concept of a solidary
obligation. Thus, We hold that the trial court, as upheld by the Court of Appeals, erred in holding
petitioner, solidarily liable with respondents Sio Choy and San Leon Rice Mill, Inc. to respondent Vallejos.
The appellate court overlooked the principle of subrogation in insurance contracts. Thus
... Subrogation is a normal incident of indemnity insurance. Upon payment of the loss, the insurer is
entitled to be subrogated pro tanto to any right of action which the insured may have against the third
person whose negligence or wrongful act caused the loss. The right of subrogation is of the highest
equity. The loss in the first instance is that of the insured but after reimbursement or
compensation, it becomes the loss of the insurer.
Although many policies including policies in the standard form, now provide for subrogation, and thus
determine the rights of the insurer in this respect, the equitable right of subrogation as the legal effect of
payment inures to the insurer without any formal assignment or any express stipulation to that effect in
the policy" (44 Am. Jur. 2nd 746). Stated otherwise, when the insurance company pays for the loss, such
payment operates as an equitable assignment to the insurer of the property and all remedies which the

insured may have for the recovery thereof. That right is not dependent upon , nor does it grow out of any
privity of contract (emphasis supplied) or upon written assignment of claim, and payment to the insured
makes the insurer assignee in equity (Shambley v. Jobe-Blackley Plumbing and Heating Co., 264 N.C.
456, 142 SE 2d 18). 9
It follows, therefore, that petitioner, upon paying respondent Vallejos the amount of riot exceeding
P20,000.00, shall become the subrogee of the insured, the respondent Sio Choy; as such, it is
subrogated to whatever rights the latter has against respondent San Leon Rice Mill, Inc. Article 1217 of
the Civil Code gives to a solidary debtor who has paid the entire obligation the right to be reimbursed by
his co-debtors for the share which corresponds to each.
Art. 1217. Payment made by one of the solidary debtors extinguishes the obligation. If two or more
solidary debtors offer to pay, the creditor may choose which offer to accept.
He who made the payment may claim from his co-debtors only the share which corresponds to each, with
the interest for the payment already made. If the payment is made before the debt is due, no interest for
the intervening period may be demanded.
xxx xxx xxx
In accordance with Article 1217, petitioner, upon payment to respondent Vallejos and thereby becoming
the subrogee of solidary debtor Sio Choy, is entitled to reimbursement from respondent
San Leon Rice Mill, Inc.
To recapitulate then: We hold that only respondents Sio Choy and San Leon Rice Mill, Inc. are
solidarily liable to the respondent Martin C. Vallejos for the amount of P29,103.00. Vallejos may
enforce the entire obligation on only one of said solidary debtors. If Sio Choy as solidary debtor is
made to pay for the entire obligation (P29,103.00) and petitioner, as insurer of Sio Choy, is
compelled to pay P20,000.00 of said entire obligation, petitioner would be entitled, as subrogee of
Sio Choy as against San Leon Rice Mills, Inc., to be reimbursed by the latter in the amount of
P14,551.50 (which is 1/2 of P29,103.00 )
WHEREFORE, the petition is GRANTED. The decision of the trial court, as affirmed by the Court of
Appeals, is hereby AFFIRMED, with the modification above-mentioned. Without pronouncement as to
costs.
SO ORDERED.
6. G.R. No. 60506 August 6, 1992
FIGURACION VDA. DE MAGLANA, EDITHA M. CRUZ, ERLINDA M. MASESAR, LEONILA M.
MALLARI, GILDA ANTONIO and the minors LEAH, LOPE, JR., and ELVIRA, all surnamed
MAGLANA, herein represented by their mother, FIGURACION VDA. DE MAGLANA, petitioners,
vs.
HONORABLE FRANCISCO Z. CONSOLACION, Presiding Judge of Davao City, Branch II, and
AFISCO INSURANCE CORPORATION, respondents.
Facts:
The nature of the liability of an insurer sued together with the insured/operator-owner of a common carrier
which figured in an accident causing the death of a third person is sought to be defined in this petition for
certiorari.
The facts as found by the trial court are as follows:
. . . Lope Maglana was an employee of the Bureau of Customs whose work station was at Lasa, here in
Davao City. On December 20, 1978, early morning, Lope Maglana was on his way to his work station,
driving a motorcycle owned by the Bureau of Customs. At Km. 7, Lanang, he met an accident that
resulted in his death. He died on the spot. The PUJ jeep that bumped the deceased was driven by Pepito
Into, operated and owned by defendant Destrajo. From the investigation conducted by the traffic
investigator, the PUJ jeep was overtaking another passenger jeep that was going towards the city
poblacion. While overtaking, the PUJ jeep of defendant Destrajo running abreast with the overtaken jeep,
bumped the motorcycle driven by the deceased who was going towards the direction of Lasa, Davao City.
The point of impact was on the lane of the motorcycle and the deceased was thrown from the road and
met his untimely death. 1
Consequently, the heirs of Lope Maglana, Sr., here petitioners, filed an action for damages and attorney's
fees against operator Patricio Destrajo and the Afisco Insurance Corporation (AFISCO for brevity) before

the then Court of First Instance of Davao, Branch II. An information for homicide thru reckless imprudence
was also filed against Pepito Into.
During the pendency of the civil case, Into was sentenced to suffer an indeterminate penalty of one (1)
year, eight (8) months and one (1) day of prision correccional, as minimum, to four (4) years, nine (9)
months and eleven (11) days of prision correccional, as maximum, with all the accessory penalties
provided by law, and to indemnify the heirs of Lope Maglana, Sr. in the amount of twelve thousand pesos
(P12,000.00) with subsidiary imprisonment in case of insolvency, plus five thousand pesos (P5,000.00) in
the concept of moral and exemplary damages with costs. No appeal was interposed by accused who later
applied for probation. 2
On December 14, 1981, the lower court rendered a decision finding that Destrajo had not exercised
sufficient diligence as the operator of the jeepney. The dispositive portion of the decision reads:
WHEREFORE, the Court finds judgment in favor of the plaintiffs against defendant Destrajo, ordering him
to pay plaintiffs the sum of P28,000.00 for loss of income; to pay plaintiffs the sum of P12,000.00 which
amount shall be deducted in the event judgment in Criminal Case No. 3527-D against the driver, accused
Into, shall have been enforced; to pay plaintiffs the sum of P5,901.70 representing funeral and burial
expenses of the deceased; to pay plaintiffs the sum of P5,000.00 as moral damages which shall be
deducted in the event judgment (sic) in Criminal Case No. 3527-D against the driver, accused Into; to pay
plaintiffs the sum of P3,000.00 as attorney's fees and to pay the costs of suit.
The defendant insurance company is ordered to reimburse defendant Destrajo whatever amounts the
latter shall have paid only up to the extent of its insurance coverage.
SO ORDERED. 3
Petitioners filed a motion for the reconsideration of the second paragraph of the dispositive portion of the
decision contending that AFISCO should not merely be held secondarily liable because the
Insurance Code provides that the insurer's liability is "direct and primary and/or jointly and severally with
the operator of the vehicle, although only up to the extent of the insurance coverage." 4 Hence, they
argued that the P20,000.00 coverage of the insurance policy issued by AFISCO, should have been
awarded in their favor.
In its comment on the motion for reconsideration, AFISCO argued that since the Insurance Code does not
expressly provide for a solidary obligation, the presumption is that the obligation is joint.
In its Order of February 9, 1982, the lower court denied the motion for reconsideration ruling that since the
insurance contract "is in the nature of suretyship, then the liability of the insurer is secondary only up to
the extent of the insurance coverage." 5
Petitioners filed a second motion for reconsideration reiterating that the liability of the insurer is direct,
primary and solidary with the jeepney operator because the petitioners became direct beneficiaries under
the provision of the policy which, in effect, is a stipulation pour autrui. 6 This motion was likewise denied
for lack of merit.
Hence, petitioners filed the instant petition for certiorari which, although it does not seek the reversal of
the lower court's decision in its entirety, prays for the setting aside or modification of the second
paragraph of the dispositive portion of said decision. Petitioners reassert their position that the insurance
company is directly and solidarily liable with the negligent operator up to the extent of its insurance
coverage.
We grant the petition.
The particular provision of the insurance policy on which petitioners base their claim is as follows:
Sec. 1 LIABILITY TO THE PUBLIC
1. The Company will, subject to the Limits of Liability, pay all sums necessary to discharge liability of the
insured in respect of
(a) death of or bodily injury to any THIRD PARTY
(b) . . . .
2. . . . .
3. In the event of the death of any person entitled to indemnity under this Policy, the
Company will, in respect of the liability incurred to such person indemnify his personal representatives in
terms of, and subject to the terms and conditions hereof. 7
The above-quoted provision leads to no other conclusion but that AFISCO can be held directly liable by
petitioners. As this Court ruled in Shafer vs. Judge, RTC of Olongapo City, Br. 75, "[w] here an insurance
policy insures directly against liability, the insurer's liability accrues immediately upon the occurrence of
the injury or even upon which the liability depends, and does not depend on the recovery of judgment by

the injured party against the insured." 8 The underlying reason behind the third party liability (TPL) of the
Compulsory Motor Vehicle Liability Insurance is "to protect injured persons against the insolvency of the
insured who causes such injury, and to give such injured person a certain beneficial interest in the
proceeds of the policy . . ." 9 Since petitioners had received from AFISCO the sum of P5,000.00 under the
no-fault clause, AFISCO's liability is now limited to P15,000.00.
However, we cannot agree that AFISCO is likewise solidarily liable with Destrajo. In Malayan Insurance
Co., Inc. v. Court of Appeals, 10 this Court had the opportunity to resolve the issue as to the nature of the
liability of the insurer and the insured vis-a-vis the third party injured in an accident. We categorically ruled
thus:
While it is true that where the insurance contract provides for indemnity against liability to third persons,
such third persons can directly sue the insurer, however, the direct liability of the insurer under indemnity
contracts against third party liability does not mean that the insurer can be held solidarily liable with the
insured and/or the other parties found at fault. The liability of the insurer is based on contract; that of the
insured is based on tort.
In the case at bar, petitioner as insurer of Sio Choy, is liable to respondent Vallejos (the injured third
party), but it cannot, as incorrectly held by the trial court, be made "solidarily" liable with the two principal
tortfeasors, namely respondents Sio Choy and San Leon Rice Mill, Inc. For if petitioner-insurer were
solidarily liable with said, two (2) respondents by reason of the indemnity contract against third party
liability under which an insurer can be directly sued by a third party
this will result in a violation of the principles underlying solidary obligation and insurance contracts.
(emphasis supplied)
The Court then proceeded to distinguish the extent of the liability and manner of enforcing the same in
ordinary contracts from that of insurance contracts. While in solidary obligations, the creditor may enforce
the entire obligation against one of the solidary debtors, in an insurance contract, the insurer undertakes
for a consideration to indemnify the insured against loss, damage or liability arising from an unknown or
contingent event. 11 Thus, petitioner therein, which, under the insurance contract is liable only up to
P20,000.00, can not be made solidarily liable with the insured for the entire obligation of P29,013.00
otherwise there would result "an evident breach of the concept of solidary obligation."
Similarly, petitioners herein cannot validly claim that AFISCO, whose liability under the insurance policy is
also P20,000.00, can be held solidarily liable with Destrajo for the total amount of P53,901.70 in
accordance with the decision of the lower court. Since under both the law and the insurance policy,
AFISCO's liability is only up to P20,000.00, the second paragraph of the dispositive portion of the decision
in question may have unwittingly sown confusion among the petitioners and their counsel. What should
have been clearly stressed as to leave no room for doubt was the liability of AFISCO under the explicit
terms of the insurance contract.
In fine, we conclude that the liability of AFISCO based on the insurance contract is direct, but not solidary
with that of Destrajo which is based on Article 2180 of the Civil Code. 12 As such, petitioners have the
option either to claim the P15,000 from AFISCO and the balance from
Destrajo or enforce the entire judgment from Destrajo subject to reimbursement from AFISCO to the
extent of the insurance coverage.
While the petition seeks a definitive ruling only on the nature of AFISCO's liability, we noticed that the
lower court erred in the computation of the probable loss of income. Using the formula: 2/3 of (80-56) x
P12,000.00, it awarded P28,800.00. 13 Upon recomputation, the correct amount is P192,000.00. Being a
"plain error," we opt to correct the same. 14 Furthermore, in accordance with prevailing jurisprudence, the
death indemnity is hereby increased to P50,000.00. 15
WHEREFORE, premises considered, the present petition is hereby GRANTED. The award of P28,800.00
representing loss of income is INCREASED to P192,000.00 and the death indemnity of P12,000.00 to
P50,000.00.
SO ORDERED.