Facts: There was a plane crash that involved PAL’s planes, the route of which was

fromIloilo-Romblon-Manila. It crashed at Mt. Baco, Mindoro, one hour and fifteen

minutesafter take-off. All passengers and crew of the said plane died. The plane
in this case was a DC-3 type of aircraft, manufactured in 1942 andacquired by the
defendant in 1948. It had flown almost 18,000 hours at the time of its ill-fated flight.
Despite its age, however, it had been certified as airworthy by theCivil Aeronautics
Administration. The petitioners of this case are the parents of Pedro Avila Jr. who was
one of thepassengers of this flight. At the time of his death, he was single and 30 years of age.
His life expectancy was 25 years. The route prescribed by the Civil Aeronautics
Administration for the flight of theplane in the afternoon of November 23, 1960 was
Iloilo-Romblon-Manila, the latterstage, denominated as airway "Amber I," being
a straight lane from Romblon toManila. The prescribed elevation of the flight was
6,000 ft. The plane reported itsposition after take-off and again when it was abeam
the Roxas homer. However, itdid not intercept airway "Amber I" over Romblon as it
was supposed to do, and thepilot did not give his position then although Romblon
was a compulsory checkingpoint. The fact was that the plane had deviated from the
prescribed route by 32miles to the west when it crashed at Mt. Baco. The reading of
the altimeter of theplane when its wreckage was found was 6,800 ft.It was suggested that
in the course of the flight between Romblon and Mindoro theaircraft was drifted
westward by the cross-winds then blowing in the region. Thedefendant, however,
has not given a definite explanation as to why, if such was thecase, the pilot failed to
make the necessary correction in his flight to compensatefor the drift. According to
the defendant's witness, Maj. Mijares, Chief of the AviationSafety Division of the Civil
Aeronautics Administration and Chairman of the CAAInvestigating Committee, there
was a navigational error, to which several factorscontributed: "the weather
observation at that time from the Weather Bureau wasnot so good between Mt.
Baco and Romblon and the wind aloft was quite strong,which would be also one of
the causes for the drifting of the aircraft; and the otherstrong probability, I would
say, would be the malfunction of the aircraft'snavigational instrument." He further
explained that "a cross-wind can drift the planeif the pilot will not make the
necessary correction, if his navigational instrument is

malfunctioning and the visual reference outside the aircraft could not make
thenecessary corrections." There is nothing in the testimony of Maj. Mijares to show
just how strong the cross-winds were in the region at the time, although in the
investigation of the accidentby the Senate Committee on transportation there was
testimony that the cross-winds had a velocity of either 20 to 25 knots or 25 to 35
knots an hour. Consideringthe relatively short distance from Romblon to Mt. Baco
and the brief span of time itwould take to fly that distance, cross-winds with the
velocity stated could not havepossibly deviated the plane by as much as 32
miles.What is undisputed therefore is that the pilot did not follow the route prescribed forhis
flight, at least between Romblon and Manila. Since up to that point overRomblon,
where he was supposed to intersect airway "Amber I" the weather wasclear, the
most reasonable conclusion is that his failure to do so was intentional,and that he
probably wanted to fly on a straight line to Manila. It was a violation of air-craft
traffic rules to which, under the circumstances, the accident
may bedirectly attributable.So, the Davila spouses filed an action for damages
against PAL for the death of theirson, and the CFI – Iloilo awarded the spouses the
following sums:(1) For the death of Pedro T. Davila, Jr. the amount of P6,000.00;(2)
For the loss of the earning capacity of the deceased at the rate of P12,000.00per
annum for five (5) years in the amount of Sixty Thousand Pesos. (P60,000.00);(3) For
moral damages in favor of the plaintiffs Ten Thousand Pesos (P10,000.00);(4) For
exemplary damages in the amount of Ten Thousand Pesos (P10,000.00);(5) For
actual damages the amount of Five Thousand Pesos (P5,000.00) brokendown to as
follows: A rolex watch valued at P600.00; a pistol worth P300.00; burialexpenses
P600.00; for the lot and the mausoleum P3,500.00;(6) For Attorney's fees the
amount of Ten Thousand Pesos (P10,000.00) or a totalamount of One Hundred and
One Thousand Pesos (P101,000.00) To pay the costs of this proceedings.

The Davila spouses appealed this ruling directly to the Supreme Court asking for
anincrease in the indemnity awarded for the death of their son, while PAL asked
forexoneration, if not mitigation, of such liability.Issue: How much should be
awarded to the Davila spouses, if any?Held: According to Article 2206, paragraph (1),
of the Civil Code, "the defendantshall be liable for the loss of the earning capacity of
the deceased and indemnityshall be paid to the heirs of the latter." This Article,
while referring to "damages fordeath caused by crime or quasi-delict," is expressly
made applicable by Article 1764"to the death of a passenger caused by the breach of
contract by a commoncarrier." The deceased, Pedro Davila, Jr., was single and 30
years of age when he died. Atthat age one's normal life expectancy is 33-1/3 years,
according to the formula (2/3x [80-30]) adopted by this Court in the case of Villa
Rey Transit, Inc. vs. Court of Appeals on the basis of the American Expectancy Table
of Mortality or the Actuarialof Combined Experience Table of Mortality. However,
although the deceased was inrelatively good health, his medical history shows that
he had complained of andbeen treated for such ailments as backaches, chest pains
and occasional feelings of tiredness. It is reasonable to make an allowance for these
circumstances andconsider, for purposes of this case, a reduction of his life
expectancy to 25 years.In the same case of Villa Revenue Transit this Court stated:"...
earning capacity, as an element of damages to one's estate for his death bywrongful
act is necessarily his net earning capacity or his capacity to acquiremoney, less the necessary
expense for his own living. Stated otherwise, the amountrecoverable is not loss of
the entire earnings, but rather the loss of that portion of the earnings which the
beneficiary would have received. In other words, only netearnings, not gross
earnings, are to be considered, that is, the total of the earningsless expenses
necessary in the creation of such earnings or income and less livingand other
incidental expenses."Considering the fact that the deceased was getting his income
from three (3)different sources, namely from managing a radio station, from law
practice andfrom farming, the expenses incidental to the generation of such income
werenecessarily more than if he had only one source. Together with his living
expenses,a deduction of P600.00 a month, or P7,200.00 a year, seems to Us
reasonable,leaving a net yearly income of P7,800.00. This amount, multiplied by 25
years, orP195,000.00 is the amount which should be awarded to the plaintiffs in
thisparticular respect.