Lambert Pawnbrokers v. Binamira, G.R. No.

170464, 12 July 2010

An employer is liable for illegal dismissal when it terminated the services of its employee without just or
authorized case and due process.

Lambert Lim, owner of Lambert Pawnbrokers and Jewelry Corporation hired Helen Binamira as
a vault custodian. After three years of service, she received a letter from Lim terminating her
employment effective immediately because of business losses necessitating retrenchment. Helen
filed a case for illegal dismissal against Lambert Pawnbrokers alleging that she was dismissed
without cause and the benefit of due process. She also claimed that there is no proof that the
company was suffering from business losses. The court ruled that is no valid retrenchment in the
employment of Helen.

Since Lim authorized the retrenchment of Helen, is he held solidarily liable with Lambert
Pawnbrokers and Jewelry Corporation for the illegal dismissal?

No. Lambert Pawnbrokers and Jewelry Corporation is solely liable for the illegal
dismissal of Helen.

As a general rule, only the employer-corporation, partnership or association or any other

entity, and not its officers, which may be held liable for illegal dismissal of employees or
for other wrongful acts. This is as it should be because a corporation is a juridical entity
with legal personality separate and distinct from those acting for and in its behalf and, in
general, from the people comprising it.

The exception to this rule is when the stockholder or officer acted with malice and bad
faith.

However, in the case at bar, there is no sufficient proof of malice or bad faith. The lack of
authorized or just cause to terminate one's employment and the failure to observe due
process do not ipso facto mean that the corporate officer acted with malice or bad faith.
There must be independent proof of malice or bad faith which is lacking in the present
case.
Asian Terminals, Inc. v. Malayan Insurance, Co., Inc., G.R. No. 171406, April 4, 2011

60,000 plastic bags of soda ash dense were shipped on board the vessel of Inchcape Shipping
Services from China to Manila. The shipment was insured by the Malayan Insurance Company,
Inc. for the value of US $456,000.00. Upon arrival of the shipment, Asian Terminals, Inc. (ATI)
was contracted as the stevedores. They held the bags for temporary storage and safekeeping
pending clearance of Customs and delivery to consignee. When the unloading of the bags was
completed, 2,702 bags were found in bad condition. A day after, ATI loaded the bags in the trucks
of MEC Customs Brokerage for transport and delivery to the consignee. However, upon arrival
in consignee’s warehouse, a total of 2,881 bags were now found to in bad condition.

The insurer paid the value of the damaged bags amounting to P643,600.25.

Insurer, as subrogee, filed before the RTC a claim for reimbursement from ATI, the shipper and
MEC. It was found that the proximate cause of the damage was the handling of ATI’s stevedores
in the unloading of the bags from the vessel, thus ATI is solely liable to pay insurer.

ATI citing Home Insurance Corporation v. CA, contends that insurer cannot claim
reimbursement as it did not present the insurance policy covering the shipment and mere
presentation of the subrogation receipt is not enough. Decide.

In this case, the non-presentation of the insurance contract is not indispensable before the
insurer can claim from the party who caused the damage. The subrogation receipt, by
itself, is already sufficient to establish that there exists an Insurer-Assured relationship
and that there was settlement of an insurance claim. In fact, the right of subrogation
accrues upon the payment by insurer of the insurance claim.

(ATI never questioned the insurer’s right to subrogation or the coverage of the insurance contract
or policy)

Conversely, in Home Insurance Corporation v. CA, the insurance policy was necessary to
prove the scope of the insurer’s liability because the shipment passed through several
stages with different parties involved in each stage. Thus, it was difficult to pinpoint in
what stage in the handling process the damage happened. Jurisprudence also shows that
the insurance policy is also necessary when it is the very issue of the parties.
PNB v. Spouses Cheah Chee Chong and Ofelia Camacho Cheah, G.R. No. 170865, 25 April
2012

Ofelia accommodated a favor asked of her by Filipina, her friend’s friend. Since Filipina did not
have a dollar account, she asked Ofelia if she could have her check cleared and encashed in the
latter’s joint dollar account with her husband. The check was drawn against Bank of America
with a face amount of $300,000.00, payable to cash. Ofelia agreed. Both went to PNB Buendia
Branch to deposit the check. They were told that the check will undergo clearing and would
normally take about 15 days. Five days later, correspondent bank of PNB informed PNB that the
proceeds of the check had now been temporarily credited to PNB’s account. After ten days, PNB
informed Ofelia that the subject check has now been cleared. The credit amount was withdrawn
and Filipina received all the proceeds.

Four days after the withdrawal, PNB Buendia Branch learned that the check had actually bounced
and received a debit advice. PNB informed Ofelia, and Ofelia immediately contacted Filipina to
get the money back. However, Filipina had already disbursed the money to different
beneficiaries.

PNB sent a demand letter to Ofelia and her husband for the return of the amount of the check,
and thereafter froze her peso and dollar deposits. A subsequent complaint was filed against them
for the collection of sum of money with the RTC, demanding payment of P8,202,220.44 plus
interest and attorney’s fees.

What was the proximate cause of the loss? Who should be held liable? Decide.

PNB’s act of releasing the proceeds of the check prior to the lapse of the 15-day clearing
period was the proximate cause of the loss. When PNB released the proceeds without
exhausting the 15-day clearing period, they contravened with established banking rules
and practice. It has been held time and time again that the payment of the amounts of
checks without previously clearing them with the drawee bank especially where the
drawee bank is a foreign bank and the amounts involved were large is contrary to normal
or ordinary banking practice. Thus, the collecting bank assumes the risk that the check
would be cleared and paid out. Banks are required a kind of diligence that is more than a
good father of the family as it is imbued with public trust. PNB failed to exercise
extraordinary diligence and reasonable business prudence. Its action of disregarding
banking policy is tantamount to gross negligence.

Though PNB’s action was the proximate cause of the loss, Ofelia’s actions also amount to
contributory negligence and should share the loss with the bank. Considering that the
amount of the foreign check was $300,000 and Ofelia did not personally know Filipina, a
higher degree of care is expected of her. She failed to exercise caution and gave her full
trust to a complete stranger which led her and her husband to be swindled.

Thus, PNB and Ofelia are equally negligent and should therefore equally suffer the loss.
Orix Metro Leasing and Finance Corporation v. Mangalinao Y Dizon, G.R. No. 174089 &
174266, 25 Jan 2012

Edurese was driving a Pathfinder bound for Isabela with 4 passengers – Spouses Mangalinao,
their daughter and their housemaid. On the other lane bound for Pampanga, a Fuso 10-wheeler
truck was driven by Loreto with truck helper, Charlie. The Fuso was moving in an erratic and
swerving motion. Behind the Pathfinder was another 10-wheeler Isuzu driven by Antonio, with
helper Rodolfo.

While Pathfinder was driving along NLEX’s fast lane, the Fuso swerved to the left and blocked
the Pathfinder’s line. The Pathfinder hit the Fuso’s left door and body, while the Isuzu’s front
crashed into the Pathfinder, completely wrecking it. The patrol police arrived at the scene. All
the passengers of the Pathfinder died on the spot, while the passengers of both trucks survived
with some injuries.

Demand letters were submitted to the registered owners of the trucks demanding compensation
but was left ignored. Thus, the children of Mangalinao spouses filed a complaint for damages
based on quasi-delict, impleading both the drivers, Loreto and Antonio, and registered owners
of the Fuso and Isuzu, Orix and Sonny respectively. The Court ruled that the drivers, together
with their registered owners, are held solidary liable for damages.

A. The driver and owner of the Isuzu argue that they should not be held liable as it was
the driver of the Fuso that was the proximate cause of the accident, thus should be
accorded the benefit of the ‘emergency rule’. Are the driver and owner of the Isuzu
absolved of damages?

Isuzu is NOT without fault and should still be held liable for damages. The smashed front
of the Isuzu shows that the strong impact of the ramming of the Pathfinder was what
pinned the passengers. Despite stepping on the brakes, the Isuzu still hit the rear of the
Pathfinder and the right side of the Fuso. This would show that the driver was driving at
a fast speed and not within a safe stopping distance. Thus, the emergency rule cannot be
applied. The emergency rule can only apply if the party is not guilty of negligence and
has acted within the best means to avoid the impending danger. If the Isuzu reduced its
speed and increased distance from the Pathfinder, it would be improbably to have hit the
vehicle or at least prevent an extensive wreck.

B. Though the operator in record, Orix contends that it is not the owner and operator
anymore as it had already sold the vehicle to MMO Trucking owned by Manuel Ong.
Should Orix now be absolved of the liability?

No. It is well settled that under the Registered Owner Rule, it is the registered owner or
the operator on record of a vehicle who will be held primarily liable for damages or
injury it may have caused. This principle belies on the protection of third persons to
easily identify and seek recourse when damage has caused. Their only way to do so
would be to go to the Motor Vehicles Office to determine who the owner is. However,
Orix may claim for reimbursement and be indemnified by Manuel, who is now the
actual owner of the vehicle.
Manila Bankers Life Insurance v. Aban, G.R. No. 175666, July 29, 2013

Sotero took out a life insurance policy from Manila Bankers Life Insurance Corporation,
designating Aban, her niece, as beneficiary. A policy was issued on August 30, 1993, with a face
value of P100,000.00 in Sotero’s favor, after the required medical examination and payment of
the insurance premium. While the insurance policy had been in force for more than 2 years and
7 months, Sotero died on April 10, 1996. Thus, Aban filed a claim for the insurance proceeds on
July 9, 1996. However, Manila Bankers denied the claim for the following reasons: (1) Sotero
was illiterate, and could not have personally applied for insurance coverage; (2) She was sickly
since 1990; (3) She did not have the financial capability to pay the premium; (4) She did not sign
the application for insurance; and (5) it was actually Aban who filed the insurance application
and designated herself as beneficiary.

Manila Bankers filed a civil case for recission and/or annulment of the policy, alleging that the
policy was obtained by fraud, concealment and/or misrepresentation under the Insurance
Code, thus voidable. Aban argues that Manila Bankers is barred by prescription pursuant to
Section 48 of the Insurance Code. Manila Bankers’ investigator testified in court, stating that the
insurance underwriter who solicited the insurance is the cousin of Aban and it was Aban who
paid the annual premiums of the policy.

May Manila Bankers rescind and/or annul the insurance policy on the ground of fraud?

NO. Sotero’s policy in favor of Abad is protected under Section 48 of the Insurance
Code.

The court found that it was Sotero who obtained the insurance for herself. Fraud must
be established with proof to entitle the insurer to rescind the contract. Without such, no
right to rescind arises.

Under Section 48 of the Insurance Code, an insurer is given two years – from the effectivity
of a life insurance contract and while the insured is alive – to discover or prove that he
policy is void ab initio or is rescindable by reason of the fraudulent concealment or
misrepresentation of the insured or his agent. After the two-year period lapses, or when
the insured dies within the period, the insurer must make good on the policy, even though
the policy was obtained by fraud, concealment, or misrepresentation.

The two-year period under Section 48 gives both the insurer and assured protection in
that the parties are given the assurance that any dishonest scheme to obtain life insurance
would be exposed, and attempts to deny a claim would be struck down. Therefore, once
the statutory two-year period has lapsed, the insurance policies are deemed legitimate
and the insured are given security that their claims are secured.

Despite the fact that the underwriter was the cousin of Abad, this would have given
Manila Banking a warning and could have conducted an investigation earlier on and
contest the fraud within the allotted two-year period.