OUR LADY OF LOURDES HOSPITAL v.

SPOUSES ROMEO AND REGINA CAPANZANA

G.R. No. 189218, March 22, 2017, SERENO, CJ.

FACTS

Regina Capanzana (Regina), was due for a caesarean section for her third pregnancy.
However, a week before scheduled date, she went into active labor and hence was brought to
Petitioner Hospital for an emergency C-section. She cleared the preoperative physical
examination and gave birth to a baby boy. 13 hours after her operation, Regina, who was with
her niece, complained of a headache, a chilly sensation, restlessness, and shortness of breath.
She asked for oxygen from the nurses; however the same only came 20 minutes after her
request. She later became cyanotic. After undergoing an x-ray, she was found to be suffering
from pulmonary edema. She was eventually transferred to the Intensive Care Unit, where she
was hooked to a mechanical ventilator.

When her condition still showed no improvement, Regina was transferred to the Cardinal
Santos Hospital. There it was found that she was suffering from rheumatic heart disease mitral
stenosis with mild pulmonary hypertension, which contributed to the onset of fluid in her lung
tissue (pulmonary edema). This development resulted in cardiopulmonary arrest and,
subsequently, brain damage. Regina lost the use of her speech, eyesight, hearing and limbs.
She was discharged in a vegetative state.

The respondent spouses hence filed a complaint for damages against the petitioner
hospital, along with the physicians in charge at the time of the emergency caesarean-section
operation, as well as the nurses on duty 13 hours later.

ISSUE

Was there medical negligence in the case, and if so, on whose part?

RULING

The nurses and petitioner hospital in the case were found negligent. There was no
negligence on the part of Dr. Ramos or Dr. Santos as it was found that they had duly observed
the medical community's recognized standard practices in attending to a patient in connection
with a C-section.

On the part of the Nurses:

In order to successfully pursue a claim in a medical negligence case, the plaintiff must
prove that a health professional either failed to do something which a reasonably prudent health
professional would have or have not done; and that the action or omission caused injury to the
patient. Proceeding from this guideline, the plaintiff must show the following elements by a
preponderance of evidence: duty of the health professional, breach of that duty, injury of the
patient, and proximate causation between the breach and the injury. Meanwhile, in fixing a
standard by which a court may determine whether the physician properly performed the
requisite duty toward the patient, expert medical testimonies from both plaintiff and defense are
resorted to.

In this case, the expert testimony of witness for the respondent Dr. Godfrey Robeniol, a
neurosurgeon, provided that the best time to treat hypoxic encephalopathy is at the time of its
occurrence; i.e., when the patient is experiencing difficulty in breathing and showing signs of
cardiac arrest. The records, including petitioner's Nurses' Notes, indisputably show that Regina
complained of difficulty in breathing before eventually showing signs of cyanosis. When she was
gasping for breath and turning cyanotic, it was the duty of the nurses to intervene immediately
by informing the resident doctor. Had they done so, proper oxygenation could have been
restored and other interventions performed without wasting valuable time. That such high
degree of care and responsiveness was needed cannot be overemphasized - considering that
according to expert medical evidence in the records, it takes only five minutes of oxygen
deprivation for irreversible brain damage to set in. In this regard, there was a delay in the
administration of oxygen to the patient, caused by the delayed response of the nurses of
petitioner hospital. They committed a breach of their duty to respond immediately to the needs
of Regina, considering her precarious situation and her physical manifestations of oxygen
deprivation. The omission of the nurses - their failure to check on Regina and to refer her to the
resident doctor and, thereafter, to immediately provide oxygen - was clearly the proximate
cause that led to the brain damage suffered by the patient.

On the part of the Hospital:

Under Article 2180 in relation to Article 2176 of the Civil Code, an employer like
petitioner hospital may be held liable for the negligence of its employees based on its
responsibility under a relationship of patria potestas. The liability of the employer under this
provision is "direct and immediate; it is not conditioned upon a prior recourse against the
negligent employee or a prior showing of the insolvency of that employee." The employer may
only be relieved of responsibility upon a showing that it exercised the diligence of a good father
of a family in the selection and supervision of its employees. The rule is that once negligence of
the employee is shown, the burden is on the employer to overcome the presumption of
negligence on the latter's part by proving observance of the required diligence.

In this case, the hospital failed to discharge its burden of proving due diligence in the
supervision of its nurses and is therefore liable for their negligence. It must be emphasized that
even though it proved due diligence in the selection of its nurses, the hospital was able to
dispose of only half the burden it must overcome. While Lourdes Hospital adduced evidence in
the selection and hiring processes of its employees, it failed to adduce evidence showing the
degree of supervision it exercised over its nurses. To prove due diligence in the supervision of
employees, it is not enough for an employer such as petitioner to emptily invoke the existence of
a formulation of rules. What is more important is the actual implementation and monitoring of
consistent compliance with the rules. Understandably, this actual implementation and
monitoring should be the constant concern of the employer, acting through dependable
supervisors who should regularly report on their supervisory functions. Thus, there must be
proof of diligence in the actual supervision of the employees' work.

In the present case, there is no proof of actual supervision of the employees' work or
actual implementation and monitoring of consistent compliance with the rules. Petitioner's failure
to sanction the tardiness of the defendant nurses shows an utter lack of actual implementation
and monitoring of compliance with the rules and ultimately of supervision over its nurses. More
important, on that fatal night, it was not shown who were the actual nurses on duty and who was
supervising these nurses.
 THE WELLEX GROUP, INC. v. U-LAND AIRLINES, CO., LTD.
G.R. No. 167519, January 14, 2015, LEONEN, J.:

FACTS

Wellex and U-Land entered into a Memorandum of Agreement to expand their

respective airline operations in Asia. They agreed to develop a long-term business relationship
through the creation of joint interest in airline operations and property development projects in
the Philippines. This agreement stated that within 40 days from its execution date, Wellex and
U-Land would execute a share purchase agreement covering U-Land’s acquisition of the shares
of stock of both APIC (APIC shares) and PEC (PEC shares).

The 40-day period lapsed but they were not able to enter into any share purchase
agreement although drafts were exchanged between the two. Despite the absence of a share
purchase agreement, U-Land remitted to Wellex a total of US$7,499,945.00. Wellex
acknowledged the receipt of these remittances in a confirmation letter. According to Wellex, the
parties agreed to enter into a security arrangement. If the sale of the shares of stock failed to
push through, the partial payments or remittances U-Land made were to be secured by the
shares of stock and parcels of land of Wellex.

Despite these transactions, Wellex and U-Land still failed to enter into the share
purchase agreement and the joint development agreement. As such, U-Land demanded the
return of the amount it had remitted to Wellex for failure to enter into a Share Purchase
Agreement. It had also offered to return all the stock certificates covering APIC shares and PEC
shares as well as the titles to real property given by Wellex as security for the amount remitted
by U-Land. Wellex, however, refused to surrender the same stating that the agreements were
virtually finalized and that the inability of the parties to execute the share purchase agreement
and the joint development agreement principally arose from problems at U-Land’s side, and not
due to Wellex’s ‘unjustified refusal to enter into the share purchase agreement. As such, U-Land
filed a Complaint praying for rescission of the First Memorandum of Agreement and damages
against Wellex and for the issuance of a Writ of Preliminary Attachment.

ISSUE

Was there an obligation created upon the happening of a condition?

RULING

None.

Article 1185 of the Civil Code provides that:

ART. 1185. The condition that some event will not happen at a determinate time
shall render the obligation effective from the moment the time indicated has
elapsed, or if it has become evident that the event cannot occur.

If no time has been fixed, the condition shall be deemed fulfilled at such time as
may have probably been contemplated, bearing in mind the nature of the
obligation.
Article 1185 provides that if an obligation is conditioned on the nonoccurrence of a particular
event at a determinate time, that obligation arises (a) at the lapse of the indicated time, or(b) if it
has become evident that the event cannot occur.

Petitioner Wellex and respondent U-Land bound themselves to negotiate with each other
within a 40-day period to enter into a share purchase agreement. If no share purchase
agreement was entered into, both parties would be freed from their respective undertakings. It is
the non-occurrence or non-execution of the share purchase agreement that would give rise to
the obligation to both parties to free each other from their respective undertakings. This includes
returning to each other all that they received in pursuit of entering into the share purchase
agreement.

At the lapse of the 40-day period, the parties failed to enter into a share purchase
agreement. This lapse is the first circumstance provided for in Article 1185 that gives rise to the
obligation. Applying Article 1185, the parties were then obligated to return to each other all that
they had received in order to be freed from their respective undertakings. However, the parties
continued their negotiations after the lapse of the 40-day period. They made subsequent
transactions with the intention to enter into the share purchase agreement. Despite that, they
still failed to enter into a share purchase agreement. Communication between the parties
ceased, and no further transactions took place. It became evident that, once again, the parties
would not enter into the share purchase agreement. This is the second circumstance provided
for in Article 1185. Thus, the obligation to free each other from their respective undertakings
remained. As such, petitioner Wellex is obligated to return the remittances made by respondent
U-Land, in the same way that respondent U-Land is obligated to return the certificates of shares
of stock and the land titles to petitioner Wellex.
 UNITED COCONUT PLANTERS BANK v. SPOUSES WALTER UY AND LILY UY
G.R. No. 204039, January 10, 2018, MARTIRES, J.

FACTS

Prime Town Property Group, Inc. (PPGI) and E. Ganzon Inc. were the joint developers
of the Kiener Hills Mactan Condominium Project (Kiener Hills). Spouses Walter and Lily
Uy (respondents) entered into a Contract to Sell with PPGI for a unit in Kiener Hills.
Subsequently, PPGI and petitioner United Coconut Planters Bank (UCPB) executed the a
Memorandum of Agreement (MOA), and Sale of Receivables and Assignment of Rights and
Interests, wherein which PPGI transferred the right to collect the receivables of the buyers,
which included respondents, of units in Kiener Hills. The parties entered into the said agreement
as PPGI's partial settlement of its loan with UCPB.

Thereafter, respondents filed a complaint for sum of money and damages against PPGI
and UCPB. They claimed that in spite of their full payment of the purchase price, PPGI failed to
complete the construction of their units in Kiener Hills. The courts found that respondents were
entitled to a refund; however there was a question as to whether UCPB could be found solidarily
liable with PPGI for the return of the purchase price.

ISSUE

Is UCPB solidarily liable with PPGI for the return of the purchase price?

RULING

No. UCPB is only jointly liable to PPGI in reimbursing unitowners of Kiener Hills.

An assignment of credit has been defined as an agreement by virtue of which the owner
of a credit, known as the assignor, by a legal cause - such as sale, dation in payment or
exchange or donation - and without need of the debtor's consent, transfers that credit and its
accessory rights to another, known as the assignee, who acquires the power to enforce it to the
same extent as the assignor could have enforced it against the debtor. In every case, the
obligations between assignor and assignee will depend upon the judicial relation which is the
basis of the assignment. An assignment will be construed in accordance with the rules of
construction governing contracts generally, the primary object being always to ascertain and
carry out the intention of the parties. This intention is to be derived from a consideration of the
whole instrument, all parts of which should be given effect, and is to be sought in the words and
language employed.

In the present case, the Agreement between Primetown and UCPB provided that
Primetown, "assigned, transferred, conveyed and set over unto [UCPB] all Accounts
Receivables accruing from Primetown's Kiener together with the assignment of all its rights,
titles, interests and participation over the units covered by or arising from the Contracts to Sell
from which the Accounts Receivables have arisen." It explicitly excluded any and all liabilities
and obligations, which Primetown assumed under the contracts to sell. Hence the agreement
between PPGI and UCPB was a mere assignment of credit. What was transferred to UCPB was
only the right to collect PPGI's receivables from the purchases of Kiener Hills and not the
obligation to complete the said condominium project. Thus, UCPB is only bound to refund the
amount it had unquestionably received from respondents after the assignment of credit.