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Alberta Yobido and Cresencio Yobido v. CA, Leny Tumboy, Ardee Tumboy and Jasmin Tumboy G.R. No.

113003 October 17, 1997 FACTS: Spouses Tito and Leny Tumboy and their minor children named Ardee and Jasmin, boardeda Yobido Liner bus bound for Davao City. Along the trip, the left front tire of the bus exploded. The bus fell into a ravine around 3 ft. from the road and struck a tree. The incident resulted in the death of Tito and physical injuries to other passengers. Factual backdrop based on testimony of Leny: the winding road the bus traversed was not cemented and was wet due to the rain; it was rough with crushed rocks. The bus which was full of passengers had cargoes on top. Since it was running fast, (at a speed of 50-60kph based on another witness testimony) she cautioned the driver to slow down but he merely stared at her through the mirror. A complaint for breach of contract of carriage was filed by Leny and her children against Alberta Yobido, the owner of the bus, and Cresencio Yobido, its driver; Yobidos raised the affirmative defense of fortuitous event; they also filed a third-party complaint against Philippine Phoenix Surety and Insurance, Inc. Upon a finding that the third party defendant was not liable under the insurance contract, the lower court dismissed the third party complaint. ISSUE: W/N the tire blowout was a fortuitous event as to exempt Yobidos from liability? HELD: No. tire blowout - mechanical defect of the conveyance or a fault in its equipment which was easily discoverable if the bus had been subjected to a more thorough or rigid check-up before it took to the road. when a passenger boards a common carrier, he takes the risks incidental to the mode of travel he has taken. After all, a carrier is not an insurer of the safety of its passengers and is not bound absolutely and at all events to carry them safely and without injury. However, when a passenger is injured or dies while travelling, the law presumes that the common carrier is negligent. (see Art. 1756) Art. 1755 provides that a common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with a due regard for all the circumstances. In culpa contractual, once a passenger dies or is injured, the carrier is presumed to have been at fault or to have acted negligently. This disputable presumption may only be overcome by evidence that the carrier had observed extraordinary diligence as prescribed by Arts. 1733, 1755 and 1756or that the death or injury of the passenger was due to a fortuitous event. characteristics of fortuitous event: a) the cause of the unforeseen and unexpected occurrence, or the failure of the debtor to comply with his obligations, must be independent of human will; b) it must be impossible to foresee the event which constitutes the fortuitous event, or if it can be foreseen, it must be impossible to avoid; c) the occurrence must be such as to render it impossible for the debtor to fulfill his obligation in a

normal manner; and d) the obligor must be free from any participation in the aggravation of the injury resulting to the creditor. Art 1174: no person shall be responsible for a fortuitous event which could not before seen, or which, though foreseen, was inevitable. the explosion of the new tire may not be considered a fortuitous event; there are human factors involved in the situation; the fact that the tire was new did not imply that it was entirely free from manufacturing defects or that it was properly mounted on the vehicle. Romero, J. ** The explosion of the new tire is not a fortuitous event. There are human factors involved in the situation. The fact that the tire was new did not imply that it was entirely free from manufacturing defects or that it was properly mounted on the vehicle. Neither may the fact that the tire bought and used is of a brand name noted for quality, resulting in the conclusion that it could not explode within five days use. It is settled that an accident caused either by defects in the automobile or through the negligence of its driver is not a fortuitous event. Moreover, a common carrier may not be absolved from liability in case of force majeure. A common carrier must still prove that it was not negligent in causing the death or injury resulting from the accident. Thus, having failed to overthrow the presumption of negligence with clear and convincing evidence, petitioners are hereby held liable for damages.

Lita Enterprises vs. Intermediate Appellate Court Facts: Spouses Nicasio Ocampo and Francisca Garcia (private respondents) purchased in installment from the Delta Motor Sales Corporation five (5) Toyota Corona Standard cars to be used as taxi. Since they had no franchise to operate taxicabs, they contracted with petitioner Lita Enterprise, Inc., through its representative Manuel Concordia, for the use of the latters certificate of public convenience for a consideration of P1, 000.00 and a monthly rental of P200.00/taxicab unit. For the agreement to take effect, the cars were registered in the name of Lita Enterprises, Inc. The possession, however, remains with spouses Ocampo and Garcia who operated and maintained the same under Acme Taxi, petitioners trade name. A year later, one of the taxicabs, driven by their employee, Emeterio Martin, collided with a motorcycle. Unfortunately the driver of the motorcycle, Florante Galvez died from the injuries it sustained. Criminal case was filed against Emeterio Martin, while a civil case was filed by the heir of the victim against Lita Enterprises. In the decision of the lower court Lita Enterprises was held liable for damages for the amount of P25, 000.00 and P7, 000.00 for attorneys fees. A writ of execution for the decision followed, 2 of the cars of the respondents spouses were levied and were sold to a public auction. On March 1973, respondent Ocampo decided to register his taxicabs in his own name. The manager of petitioner refused to give him the registration papers. Thus, making spouses file a complaint against petitioner. In the decision, Lita Enterprise was ordered to return the three certificate of registration not levied in the prior case. Petitioner now prays that private respondent be held liable to pay the amount they have given to the heir of Galvez. Issue: W/N petitioner can recover from private respondent, knowing they are in an arrangement known as kabit system? Held: Kabit system is defined as, when a person who has been granted a certificate of convenience allows another person who owns a motor vehicle to operate under such franchise for a fee. This system is not penalized as a criminal offense but is recognized as one that is against public policy; therefore it is void and inexistent. It is fundamental that the court will not aid either of the party to enforce an illegal contract, but will leave them both where it finds them. Upon this premise, it was flagrant error on the part of both trial and appellate courts to have accorded the parties relief from their predicament. Specifically Article 1412 states that: If the act in which the unlawful or forbidden cause consists does not constitute a criminal offense, the following rules shall be observed: when the fault, is on the part of both contracting parties,

neither may recover what he has given by virtue of the contract, or demand the performance of the others undertaking. The principle of in pari delicto is evident in this case. the proposition is universal that no action arises, in equity or at law, from an illegal contract; no suit can be maintained for its specific performance, or to recover the property agreed to sold or delivered, or damages for its property agreed to be sold or delivered, or damages for its violation. The parties in this case are in pari delicto, therefore no affirmative relief can be granted to them.

** Unquestionably, the parties herein operated under an arrangement, comonly known as the "kabit system", whereby a person who has been granted a certificate of convenience allows another person who owns motors vehicles to operate under such franchise for a fee. A certificate of public convenience is a special privilege conferred by the government . Abuse of this privilege by the grantees thereof cannot be countenanced. Although not outrightly penalized as a criminal offense, the "kabit system" is invariably recognized as being contrary to public policy and, therefore, void and inexistent under Article 1409 of the Civil Code, It is a fundamental principle that the court will not aid either party to enforce an illegal contract, but will leave them both where it finds them.