Republic of the Philippines

SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 124354 December 29, 1999

ROGELIO E. RAMOS and ERLINDA RAMOS, in their own behalf and as natural guardians of the minors, ROMMEL RAMOS, ROY
RODERICK RAMOS and RON RAYMOND RAMOS, petitioners,
vs.
COURT OF APPEALS, DELOS SANTOS MEDICAL CENTER, DR. ORLINO HOSAKA and DRA. PERFECTA GUTIERREZ, respondents.

KAPUNAN, J.:

The Hippocratic Oath mandates physicians to give primordial consideration to the health and welfare of their patients. If a doctor fails
to live up to this precept, he is made accountable for his acts. A mistake, through gross negligence or incompetence or plain human
error, may spell the difference between life and death. In this sense, the doctor plays God on his patient's fate. 1

In the case at bar, the Court is called upon to rule whether a surgeon, an anesthesiologist and a hospital should be made liable for the
unfortunate comatose condition of a patient scheduled for cholecystectomy. 2

Petitioners seek the reversal of the decision 3 of the Court of Appeals, dated 29 May 1995, which overturned the decision 4 of the
Regional Trial Court, dated 30 January 1992, finding private respondents liable for damages arising from negligence in the performance
of their professional duties towards petitioner Erlinda Ramos resulting in her comatose condition.

The antecedent facts as summarized by the trial court are reproduced hereunder:

Plaintiff Erlinda Ramos was, until the afternoon of June 17, 1985, a 47-year old (Exh. "A") robust woman (TSN,
October 19, 1989, p. 10). Except for occasional complaints of discomfort due to pains allegedly caused by the
presence of a stone in her gall bladder (TSN, January 13, 1988, pp. 4-5), she was as normal as any other woman.
Married to Rogelio E. Ramos, an executive of Philippine Long Distance Telephone Company, she has three children
whose names are Rommel Ramos, Roy Roderick Ramos and Ron Raymond Ramos (TSN, October 19, 1989, pp. 5-6).

Because the discomforts somehow interfered with her normal ways, she sought professional advice. She was advised
to undergo an operation for the removal of a stone in her gall bladder (TSN, January 13, 1988, p. 5). She underwent
a series of examinations which included blood and urine tests (Exhs. "A" and "C") which indicated she was fit for
surgery.

Through the intercession of a mutual friend, Dr. Buenviaje (TSN, January 13, 1988, p. 7), she and her husband Rogelio
met for the first time Dr. Orlino Hozaka (should be Hosaka; see TSN, February 20, 1990, p. 3), one of the defendants
in this case, on June 10, 1985. They agreed that their date at the operating table at the DLSMC (another defendant),
would be on June 17, 1985 at 9:00 A.M.. Dr. Hosaka decided that she should undergo a "cholecystectomy" operation
after examining the documents (findings from the Capitol Medical Center, FEU Hospital and DLSMC) presented to
him. Rogelio E. Ramos, however, asked Dr. Hosaka to look for a good anesthesiologist. Dr. Hosaka, in turn, assured
Rogelio that he will get a good anesthesiologist. Dr. Hosaka charged a fee of P16,000.00, which was to include the
anesthesiologist's fee and which was to be paid after the operation (TSN, October 19, 1989, pp. 14-15, 22-23, 31-33;
TSN, February 27, 1990, p. 13; and TSN, November 9, 1989, pp. 3-4, 10, 17).

A day before the scheduled date of operation, she was admitted at one of the rooms of the DLSMC, located along E.
Rodriguez Avenue, Quezon City (TSN, October 19,1989, p. 11).
At around 7:30 A.M. of June 17, 1985 and while still in her room, she was prepared for the operation by the hospital
staff. Her sister-in-law, Herminda Cruz, who was the Dean of the College of Nursing at the Capitol Medical Center,
was also there for moral support. She reiterated her previous request for Herminda to be with her even during the
operation. After praying, she was given injections. Her hands were held by Herminda as they went down from her
room to the operating room (TSN, January 13, 1988, pp. 9-11). Her husband, Rogelio, was also with her (TSN, October
19, 1989, p. 18). At the operating room, Herminda saw about two or three nurses and Dr. Perfecta Gutierrez, the
other defendant, who was to administer anesthesia. Although not a member of the hospital staff, Herminda
introduced herself as Dean of the College of Nursing at the Capitol Medical Center who was to provide moral support
to the patient, to them. Herminda was allowed to stay inside the operating room.

At around 9:30 A.M., Dr. Gutierrez reached a nearby phone to look for Dr. Hosaka who was not yet in (TSN, January
13, 1988, pp. 11-12). Dr. Gutierrez thereafter informed Herminda Cruz about the prospect of a delay in the arrival of
Dr. Hosaka. Herminda then went back to the patient who asked, "Mindy, wala pa ba ang Doctor"? The former replied,
"Huwag kang mag-alaala, darating na iyon" (Ibid.).

Thereafter, Herminda went out of the operating room and informed the patient's husband, Rogelio, that the doctor
was not yet around (id., p. 13). When she returned to the operating room, the patient told her, "Mindy, inip na inip
na ako, ikuha mo ako ng ibang Doctor." So, she went out again and told Rogelio about what the patient said (id., p.
15). Thereafter, she returned to the operating room.

At around 10:00 A.M., Rogelio E. Ramos was "already dying [and] waiting for the arrival of the doctor" even as he
did his best to find somebody who will allow him to pull out his wife from the operating room (TSN, October 19,
1989, pp. 19-20). He also thought of the feeling of his wife, who was inside the operating room waiting for the doctor
to arrive (ibid.). At almost 12:00 noon, he met Dr. Garcia who remarked that he (Dr. Garcia) was also tired of waiting
for Dr. Hosaka to arrive (id., p. 21). While talking to Dr. Garcia at around 12:10 P.M., he came to know that Dr. Hosaka
arrived as a nurse remarked, "Nandiyan na si Dr. Hosaka, dumating na raw." Upon hearing those words, he went
down to the lobby and waited for the operation to be completed (id., pp. 16, 29-30).

At about 12:15 P.M., Herminda Cruz, who was inside the operating room with the patient, heard somebody say that
"Dr. Hosaka is already here." She then saw people inside the operating room "moving, doing this and that, [and]
preparing the patient for the operation" (TSN, January 13, 1988, p. 16). As she held the hand of Erlinda Ramos, she
then saw Dr. Gutierrez intubating the hapless patient. She thereafter heard Dr. Gutierrez say, "ang hirap ma-intubate
nito, mali yata ang pagkakapasok. O lumalaki ang tiyan" (id., p. 17). Because of the remarks of Dra. Gutierrez, she
focused her attention on what Dr. Gutierrez was doing. She thereafter noticed bluish discoloration of the nailbeds
of the left hand of the hapless Erlinda even as Dr. Hosaka approached her. She then heard Dr. Hosaka issue an order
for someone to call Dr. Calderon, another anesthesiologist (id., p. 19). After Dr. Calderon arrived at the operating
room, she saw this anesthesiologist trying to intubate the patient. The patient's nailbed became bluish and the
patient was placed in a trendelenburg position — a position where the head of the patient is placed in a position
lower than her feet which is an indication that there is a decrease of blood supply to the patient's brain (Id., pp. 19-
20). Immediately thereafter, she went out of the operating room, and she told Rogelio E. Ramos "that something
wrong was . . . happening" (Ibid.). Dr. Calderon was then able to intubate the patient (TSN, July 25, 1991, p. 9).

Meanwhile, Rogelio, who was outside the operating room, saw a respiratory machine being rushed towards the door
of the operating room. He also saw several doctors rushing towards the operating room. When informed by
Herminda Cruz that something wrong was happening, he told her (Herminda) to be back with the patient inside the
operating room (TSN, October 19, 1989, pp. 25-28).

Herminda Cruz immediately rushed back, and saw that the patient was still in trendelenburg position (TSN, January
13, 1988, p. 20). At almost 3:00 P.M. of that fateful day, she saw the patient taken to the Intensive Care Unit (ICU).

About two days thereafter, Rogelio E. Ramos was able to talk to Dr. Hosaka. The latter informed the former that
something went wrong during the intubation. Reacting to what was told to him, Rogelio reminded the doctor that
the condition of his wife would not have happened, had he (Dr. Hosaka) looked for a good anesthesiologist (TSN,
October 19, 1989, p. 31).

Doctors Gutierrez and Hosaka were also asked by the hospital to explain what happened to the patient. The doctors
explained that the patient had bronchospasm (TSN, November 15, 1990, pp. 26-27).
 Erlinda Ramos stayed at the ICU for a month. About four months thereafter or on November 15, 1985, the patient
was released from the hospital.

During the whole period of her confinement, she incurred hospital bills amounting to P93,542.25 which is the subject
of a promissory note and affidavit of undertaking executed by Rogelio E. Ramos in favor of DLSMC. Since that fateful
afternoon of June 17, 1985, she has been in a comatose condition. She cannot do anything. She cannot move any
part of her body. She cannot see or hear. She is living on mechanical means. She suffered brain damage as a result
of the absence of oxygen in her brain for four to five minutes (TSN, November 9, 1989, pp. 21-22). After being
discharged from the hospital, she has been staying in their residence, still needing constant medical attention, with
her husband Rogelio incurring a monthly expense ranging from P8,000.00 to P10,000.00 (TSN, October 19, 1989, pp.
32-34). She was also diagnosed to be suffering from "diffuse cerebral parenchymal damage" (Exh. "G"; see also TSN,
December 21, 1989,
p. 6). 5

Thus, on 8 January 1986, petitioners filed a civil case 6 for damages with the Regional Trial Court of Quezon City against herein private
respondents alleging negligence in the management and care of Erlinda Ramos.

During the trial, both parties presented evidence as to the possible cause of Erlinda's injury. Plaintiff presented the testimonies of
Dean Herminda Cruz and Dr. Mariano Gavino to prove that the sustained by Erlinda was due to lack of oxygen in her brain caused by
the faulty management of her airway by private respondents during the anesthesia phase. On the other hand, private respondents
primarily relied on the expert testimony of Dr. Eduardo Jamora, a pulmonologist, to the effect that the cause of brain damage was
Erlinda's allergic reaction to the anesthetic agent, Thiopental Sodium (Pentothal).

After considering the evidence from both sides, the Regional Trial Court rendered judgment in favor of petitioners, to wit:

After evaluating the evidence as shown in the finding of facts set forth earlier, and applying the aforecited provisions
of law and jurisprudence to the case at bar, this Court finds and so holds that defendants are liable to plaintiffs for
damages. The defendants were guilty of, at the very least, negligence in the performance of their duty to plaintiff-
patient Erlinda Ramos.

On the part of Dr. Perfecta Gutierrez, this Court finds that she omitted to exercise reasonable care in not only
intubating the patient, but also in not repeating the administration of atropine (TSN, August 20, 1991, pp. 5-10),
without due regard to the fact that the patient was inside the operating room for almost three (3) hours. For after
she committed a mistake in intubating [the] patient, the patient's nailbed became bluish and the patient, thereafter,
was placed in trendelenburg position, because of the decrease of blood supply to the patient's brain. The evidence
further shows that the hapless patient suffered brain damage because of the absence of oxygen in her (patient's)
brain for approximately four to five minutes which, in turn, caused the patient to become comatose.

On the part of Dr. Orlino Hosaka, this Court finds that he is liable for the acts of Dr. Perfecta Gutierrez whom he had
chosen to administer anesthesia on the patient as part of his obligation to provide the patient a good
anesthesiologist', and for arriving for the scheduled operation almost three (3) hours late.

On the part of DLSMC (the hospital), this Court finds that it is liable for the acts of negligence of the doctors in their
"practice of medicine" in the operating room. Moreover, the hospital is liable for failing through its responsible
officials, to cancel the scheduled operation after Dr. Hosaka inexcusably failed to arrive on time.

In having held thus, this Court rejects the defense raised by defendants that they have acted with due care and
prudence in rendering medical services to plaintiff-patient. For if the patient was properly intubated as claimed by
them, the patient would not have become comatose. And, the fact that another anesthesiologist was called to try
to intubate the patient after her (the patient's) nailbed turned bluish, belie their claim. Furthermore, the defendants
should have rescheduled the operation to a later date. This, they should have done, if defendants acted with due
care and prudence as the patient's case was an elective, not an emergency case.

xxx xxx xxx

WHEREFORE, and in view of the foregoing, judgment is rendered in favor of the plaintiffs and against the defendants.
Accordingly, the latter are ordered to pay, jointly and severally, the former the following sums of money, to wit:
 1) the sum of P8,000.00 as actual monthly expenses for the plaintiff Erlinda Ramos reckoned from
November 15, 1985 or in the total sum of P632,000.00 as of April 15, 1992, subject to its being
updated;

2) the sum of P100,000.00 as reasonable attorney's fees;

3) the sum of P800,000.00 by way of moral damages and the further sum of P200,000,00 by way
of exemplary damages; and,

4) the costs of the suit.

SO ORDERED. 7

Private respondents seasonably interposed an appeal to the Court of Appeals. The appellate court rendered a Decision, dated 29 May
1995, reversing the findings of the trial court. The decretal portion of the decision of the appellate court reads:

WHEREFORE, for the foregoing premises the appealed decision is hereby REVERSED, and the complaint below
against the appellants is hereby ordered DISMISSED. The counterclaim of appellant De Los Santos Medical Center is
GRANTED but only insofar as appellees are hereby ordered to pay the unpaid hospital bills amounting to P93,542.25,
plus legal interest for justice must be tempered with mercy.

SO ORDERED. 8

The decision of the Court of Appeals was received on 9 June 1995 by petitioner Rogelio Ramos who was mistakenly addressed as "Atty.
Rogelio Ramos." No copy of the decision, however, was sent nor received by the Coronel Law Office, then counsel on record of
petitioners. Rogelio referred the decision of the appellate court to a new lawyer, Atty. Ligsay, only on 20 June 1995, or four (4) days
before the expiration of the reglementary period for filing a motion for reconsideration. On the same day, Atty. Ligsay, filed with the
appellate court a motion for extension of time to file a motion for reconsideration. The motion for reconsideration was submitted on
4 July 1995. However, the appellate court denied the motion for extension of time in its Resolution dated 25 July 1995. 9 Meanwhile,
petitioners engaged the services of another counsel, Atty. Sillano, to replace Atty. Ligsay. Atty. Sillano filed on 7 August 1995 a motion
to admit the motion for reconsideration contending that the period to file the appropriate pleading on the assailed decision had not
yet commenced to run as the Division Clerk of Court of the Court of Appeals had not yet served a copy thereof to the counsel on
record. Despite this explanation, the appellate court still denied the motion to admit the motion for reconsideration of petitioners in
its Resolution, dated 29 March 1996, primarily on the ground that the fifteen-day (15) period for filing a motion for reconsideration
had already expired, to wit:

We said in our Resolution on July 25, 1995, that the filing of a Motion for Reconsideration cannot be extended;
precisely, the Motion for Extension (Rollo, p. 12) was denied. It is, on the other hand, admitted in the latter Motion
that plaintiffs/appellees received a copy of the decision as early as June 9, 1995. Computation wise, the period to
file a Motion for Reconsideration expired on June 24. The Motion for Reconsideration, in turn, was received by the
Court of Appeals already on July 4, necessarily, the 15-day period already passed. For that alone, the latter should
be denied.

Even assuming admissibility of the Motion for the Reconsideration, but after considering the Comment/Opposition,
the former, for lack of merit, is hereby DENIED.

SO ORDERED. 10

A copy of the above resolution was received by Atty. Sillano on 11 April 1996. The next day, or on 12 April 1996, Atty. Sillano filed
before this Court a motion for extension of time to file the present petition for certiorari under Rule 45. The Court granted the motion
for extension of time and gave petitioners additional thirty (30) days after the expiration of the fifteen-day (15) period counted from
the receipt of the resolution of the Court of Appeals within which to submit the petition. The due date fell on 27 May 1996. The
petition was filed on 9 May 1996, well within the extended period given by the Court.

Petitioners assail the decision of the Court of Appeals on the following grounds:
 I

IN PUTTING MUCH RELIANCE ON THE TESTIMONIES OF RESPONDENTS DRA. GUTIERREZ, DRA. CALDERON AND DR.
JAMORA;

II

IN FINDING THAT THE NEGLIGENCE OF THE RESPONDENTS DID NOT CAUSE THE UNFORTUNATE COMATOSE
CONDITION OF PETITIONER ERLINDA RAMOS;

III

IN NOT APPLYING THE DOCTRINE OF RES IPSA LOQUITUR. 11

Before we discuss the merits of the case, we shall first dispose of the procedural issue on the timeliness of the petition in relation to
the motion for reconsideration filed by petitioners with the Court of Appeals. In their
Comment, 12 private respondents contend that the petition should not be given due course since the motion for reconsideration of
the petitioners on the decision of the Court of Appeals was validly dismissed by the appellate court for having been filed beyond the
reglementary period. We do not agree.

A careful review of the records reveals that the reason behind the delay in filing the motion for reconsideration is attributable to the
fact that the decision of the Court of Appeals was not sent to then counsel on record of petitioners, the Coronel Law Office. In fact, a
copy of the decision of the appellate court was instead sent to and received by petitioner Rogelio Ramos on 9 June 1995 wherein he
was mistakenly addressed as Atty. Rogelio Ramos. Based on the other communications received by petitioner Rogelio Ramos, the
appellate court apparently mistook him for the counsel on record. Thus, no copy of the decision of the counsel on record. Petitioner,
not being a lawyer and unaware of the prescriptive period for filing a motion for reconsideration, referred the same to a legal counsel
only on 20 June 1995.

It is elementary that when a party is represented by counsel, all notices should be sent to the party's lawyer at his given address. With
a few exceptions, notice to a litigant without notice to his counsel on record is no notice at all. In the present case, since a copy of the
decision of the appellate court was not sent to the counsel on record of petitioner, there can be no sufficient notice to speak of. Hence,
the delay in the filing of the motion for reconsideration cannot be taken against petitioner. Moreover, since the Court of Appeals
already issued a second Resolution, dated 29 March 1996, which superseded the earlier resolution issued on 25 July 1995, and denied
the motion for reconsideration of petitioner, we believed that the receipt of the former should be considered in determining the
timeliness of the filing of the present petition. Based on this, the petition before us was submitted on time.

After resolving the foregoing procedural issue, we shall now look into the merits of the case. For a more logical presentation of the
discussion we shall first consider the issue on the applicability of the doctrine of res ipsa loquitur to the instant case. Thereafter, the
first two assigned errors shall be tackled in relation to the res ipsa loquitur doctrine.

Res ipsa loquitur is a Latin phrase which literally means "the thing or the transaction speaks for itself." The phrase "res ipsa loquitur''
is a maxim for the rule that the fact of the occurrence of an injury, taken with the surrounding circumstances, may permit an inference
or raise a presumption of negligence, or make out a plaintiff's prima facie case, and present a question of fact for defendant to meet
with an explanation. 13 Where the thing which caused the injury complained of is shown to be under the management of the
defendant or his servants and the accident is such as in ordinary course of things does not happen if those who have its management
or control use proper care, it affords reasonable evidence, in the absence of explanation by the defendant, that the accident arose
from or was caused by the defendant's want of care. 14

The doctrine of res ipsa loquitur is simply a recognition of the postulate that, as a matter of common knowledge and experience, the
very nature of certain types of occurrences may justify an inference of negligence on the part of the person who controls the
instrumentality causing the injury in the absence of some explanation by the defendant who is charged with negligence. 15 It is
grounded in the superior logic of ordinary human experience and on the basis of such experience or common knowledge, negligence
may be deduced from the mere occurrence of the accident itself. 16 Hence, res ipsa loquitur is applied in conjunction with the doctrine
of common knowledge.

However, much has been said that res ipsa loquitur is not a rule of substantive law and, as such, does not create or constitute an
independent or separate ground of liability. 17 Instead, it is considered as merely evidentiary or in the nature of a procedural rule. 18
It is regarded as a mode of proof, or a mere procedural of convenience since it furnishes a substitute for, and relieves a plaintiff of,
the burden of producing specific proof of negligence. 19 In other words, mere invocation and application of the doctrine does not
dispense with the requirement of proof of negligence. It is simply a step in the process of such proof, permitting the plaintiff to present
along with the proof of the accident, enough of the attending circumstances to invoke the doctrine, creating an inference or
presumption of negligence, and to thereby place on the defendant the burden of going forward with the proof. 20 Still, before resort
to the doctrine may be allowed, the following requisites must be satisfactorily shown:

1. The accident is of a kind which ordinarily does not occur in the absence of someone's negligence;

2. It is caused by an instrumentality within the exclusive control of the defendant or defendants;

and

3. The possibility of contributing conduct which would make the plaintiff responsible is eliminated.
21

In the above requisites, the fundamental element is the "control of instrumentality" which caused the damage. 22 Such element of
control must be shown to be within the dominion of the defendant. In order to have the benefit of the rule, a plaintiff, in addition to
proving injury or damage, must show a situation where it is applicable, and must establish that the essential elements of the doctrine
were present in a particular incident. 23

Medical malpractice 24 cases do not escape the application of this doctrine. Thus, res ipsa loquitur has been applied when the
circumstances attendant upon the harm are themselves of such a character as to justify an inference of negligence as the cause of
that harm. 25 The application of res ipsa loquitur in medical negligence cases presents a question of law since it is a judicial function
to determine whether a certain set of circumstances does, as a matter of law, permit a given inference. 26

Although generally, expert medical testimony is relied upon in malpractice suits to prove that a physician has done a negligent act or
that he has deviated from the standard medical procedure, when the doctrine of res ipsa loquitur is availed by the plaintiff, the need
for expert medical testimony is dispensed with because the injury itself provides the proof of negligence. 27 The reason is that the
general rule on the necessity of expert testimony applies only to such matters clearly within the domain of medical science, and not
to matters that are within the common knowledge of mankind which may be testified to by anyone familiar with the facts. 28
Ordinarily, only physicians and surgeons of skill and experience are competent to testify as to whether a patient has been treated or
operated upon with a reasonable degree of skill and care. However, testimony as to the statements and acts of physicians and
surgeons, external appearances, and manifest conditions which are observable by any one may be given by non-expert witnesses. 29
Hence, in cases where the res ipsa loquitur is applicable, the court is permitted to find a physician negligent upon proper proof of
injury to the patient, without the aid of expert testimony, where the court from its fund of common knowledge can determine the
proper standard of care. 30 Where common knowledge and experience teach that a resulting injury would not have occurred to the
patient if due care had been exercised, an inference of negligence may be drawn giving rise to an application of the doctrine of res
ipsa loquitur without medical evidence, which is ordinarily required to show not only what occurred but how and why it occurred. 31
When the doctrine is appropriate, all that the patient must do is prove a nexus between the particular act or omission complained of
and the injury sustained while under the custody and management of the defendant without need to produce expert medical
testimony to establish the standard of care. Resort to res ipsa loquitur is allowed because there is no other way, under usual and
ordinary conditions, by which the patient can obtain redress for injury suffered by him.

Thus, courts of other jurisdictions have applied the doctrine in the following situations: leaving of a foreign object in the body of the
patient after an operation, 32 injuries sustained on a healthy part of the body which was not under, or in the area, of treatment, 33
removal of the wrong part of the body when another part was intended, 34 knocking out a tooth while a patient's jaw was under
anesthetic for the removal of his tonsils, 35 and loss of an eye while the patient plaintiff was under the influence of anesthetic, during
or following an operation for appendicitis, 36 among others.

Nevertheless, despite the fact that the scope of res ipsa loquitur has been measurably enlarged, it does not automatically apply to all
cases of medical negligence as to mechanically shift the burden of proof to the defendant to show that he is not guilty of the ascribed
negligence. Res ipsa loquitur is not a rigid or ordinary doctrine to be perfunctorily used but a rule to be cautiously applied, depending
upon the circumstances of each case. It is generally restricted to situations in malpractice cases where a layman is able to say, as a
matter of common knowledge and observation, that the consequences of professional care were not as such as would ordinarily have
followed if due care had been
exercised. 37 A distinction must be made between the failure to secure results, and the occurrence of something more unusual and
not ordinarily found if the service or treatment rendered followed the usual procedure of those skilled in that particular practice. It
must be conceded that the doctrine of res ipsa loquitur can have no application in a suit against a physician or surgeon which involves
the merits of a diagnosis or of a scientific treatment. 38 The physician or surgeon is not required at his peril to explain why any
particular diagnosis was not correct, or why any particular scientific treatment did not produce the desired result. 39 Thus, res ipsa
loquitur is not available in a malpractice suit if the only showing is that the desired result of an operation or treatment was not
accomplished. 40 The real question, therefore, is whether or not in the process of the operation any extraordinary incident or unusual
event outside of the routine performance occurred which is beyond the regular scope of customary professional activity in such
operations, which, if unexplained would themselves reasonably speak to the average man as the negligent cause or causes of the
untoward consequence. 41 If there was such extraneous interventions, the doctrine of res ipsa loquitur may be utilized and the
defendant is called upon to explain the matter, by evidence of exculpation, if he could. 42

We find the doctrine of res ipsa loquitur appropriate in the case at bar. As will hereinafter be explained, the damage sustained by
Erlinda in her brain prior to a scheduled gall bladder operation presents a case for the application of res ipsa loquitur.

A case strikingly similar to the one before us is Voss vs. Bridwell, 43 where the Kansas Supreme Court in applying the res ipsa loquitur
stated:

The plaintiff herein submitted himself for a mastoid operation and delivered his person over to the care, custody
and control of his physician who had complete and exclusive control over him, but the operation was never
performed. At the time of submission he was neurologically sound and physically fit in mind and body, but he
suffered irreparable damage and injury rendering him decerebrate and totally incapacitated. The injury was one
which does not ordinarily occur in the process of a mastoid operation or in the absence of negligence in the
administration of an anesthetic, and in the use and employment of an endoctracheal tube. Ordinarily a person being
put under anesthesia is not rendered decerebrate as a consequence of administering such anesthesia in the absence
of negligence. Upon these facts and under these circumstances a layman would be able to say, as a matter of
common knowledge and observation, that the consequences of professional treatment were not as such as would
ordinarily have followed if due care had been exercised.

Here the plaintiff could not have been guilty of contributory negligence because he was under the influence of
anesthetics and unconscious, and the circumstances are such that the true explanation of event is more accessible
to the defendants than to the plaintiff for they had the exclusive control of the instrumentalities of anesthesia.

Upon all the facts, conditions and circumstances alleged in Count II it is held that a cause of action is stated under
the doctrine of res ipsa loquitur. 44

Indeed, the principles enunciated in the aforequoted case apply with equal force here. In the present case, Erlinda submitted herself
for cholecystectomy and expected a routine general surgery to be performed on her gall bladder. On that fateful day she delivered
her person over to the care, custody and control of private respondents who exercised complete and exclusive control over her. At
the time of submission, Erlinda was neurologically sound and, except for a few minor discomforts, was likewise physically fit in mind
and body. However, during the administration of anesthesia and prior to the performance of cholecystectomy she suffered irreparable
damage to her brain. Thus, without undergoing surgery, she went out of the operating room already decerebrate and totally
incapacitated. Obviously, brain damage, which Erlinda sustained, is an injury which does not normally occur in the process of a gall
bladder operation. In fact, this kind of situation does not in the absence of negligence of someone in the administration of anesthesia
and in the use of endotracheal tube. Normally, a person being put under anesthesia is not rendered decerebrate as a consequence of
administering such anesthesia if the proper procedure was followed. Furthermore, the instruments used in the administration of
anesthesia, including the endotracheal tube, were all under the exclusive control of private respondents, who are the physicians-in-
charge. Likewise, petitioner Erlinda could not have been guilty of contributory negligence because she was under the influence of
anesthetics which rendered her unconscious.

Considering that a sound and unaffected member of the body (the brain) is injured or destroyed while the patient is unconscious and
under the immediate and exclusive control of the physicians, we hold that a practical administration of justice dictates the application
of res ipsa loquitur. Upon these facts and under these circumstances the Court would be able to say, as a matter of common knowledge
and observation, if negligence attended the management and care of the patient. Moreover, the liability of the physicians and the
hospital in this case is not predicated upon an alleged failure to secure the desired results of an operation nor on an alleged lack of
skill in the diagnosis or treatment as in fact no operation or treatment was ever performed on Erlinda. Thus, upon all these initial
determination a case is made out for the application of the doctrine of res ipsa loquitur.
Nonetheless, in holding that res ipsa loquitur is available to the present case we are not saying that the doctrine is applicable in any
and all cases where injury occurs to a patient while under anesthesia, or to any and all anesthesia cases. Each case must be viewed in
its own light and scrutinized in order to be within the res ipsa loquitur coverage.

Having in mind the applicability of the res ipsa loquitur doctrine and the presumption of negligence allowed therein, the Court now
comes to the issue of whether the Court of Appeals erred in finding that private respondents were not negligent in the care of Erlinda
during the anesthesia phase of the operation and, if in the affirmative, whether the alleged negligence was the proximate cause of
Erlinda's comatose condition. Corollary thereto, we shall also determine if the Court of Appeals erred in relying on the testimonies of
the witnesses for the private respondents.

In sustaining the position of private respondents, the Court of Appeals relied on the testimonies of Dra. Gutierrez, Dra. Calderon and
Dr. Jamora. In giving weight to the testimony of Dra. Gutierrez, the Court of Appeals rationalized that she was candid enough to admit
that she experienced some difficulty in the endotracheal intubation 45 of the patient and thus, cannot be said to be covering her
negligence with falsehood. The appellate court likewise opined that private respondents were able to show that the brain damage
sustained by Erlinda was not caused by the alleged faulty intubation but was due to the allergic reaction of the patient to the drug
Thiopental Sodium (Pentothal), a short-acting barbiturate, as testified on by their expert witness, Dr. Jamora. On the other hand, the
appellate court rejected the testimony of Dean Herminda Cruz offered in favor of petitioners that the cause of the brain injury was
traceable to the wrongful insertion of the tube since the latter, being a nurse, was allegedly not knowledgeable in the process of
intubation. In so holding, the appellate court returned a verdict in favor of respondents physicians and hospital and absolved them of
any liability towards Erlinda and her family.

We disagree with the findings of the Court of Appeals. We hold that private respondents were unable to disprove the presumption of
negligence on their part in the care of Erlinda and their negligence was the proximate cause of her piteous condition.

In the instant case, the records are helpful in furnishing not only the logical scientific evidence of the pathogenesis of the injury but
also in providing the Court the legal nexus upon which liability is based. As will be shown hereinafter, private respondents' own
testimonies which are reflected in the transcript of stenographic notes are replete of signposts indicative of their negligence in the
care and management of Erlinda.

With regard to Dra. Gutierrez, we find her negligent in the care of Erlinda during the anesthesia phase. As borne by the records,
respondent Dra. Gutierrez failed to properly intubate the patient. This fact was attested to by Prof. Herminda Cruz, Dean of the Capitol
Medical Center School of Nursing and petitioner's sister-in-law, who was in the operating room right beside the patient when the
tragic event occurred. Witness Cruz testified to this effect:

ATTY. PAJARES:

Q: In particular, what did Dra. Perfecta Gutierrez do, if any on the patient?

A: In particular, I could see that she was intubating the patient.

Q: Do you know what happened to that intubation process administered by Dra. Gutierrez?

ATTY. ALCERA:

She will be incompetent Your Honor.

COURT:

Witness may answer if she knows.

A: As have said, I was with the patient, I was beside the stretcher holding the left hand of the
patient and all of a sudden heard some remarks coming from Dra. Perfecta Gutierrez herself. She
was saying "Ang hirap ma-intubate nito, mali yata ang pagkakapasok. O lumalaki ang tiyan.

xxx xxx xxx

 ATTY. PAJARES:

Q: From whom did you hear those words "lumalaki ang tiyan"?

A: From Dra. Perfecta Gutierrez.

xxx xxx xxx

Q: After hearing the phrase "lumalaki ang tiyan," what did you notice on the person of the patient?

A: I notice (sic) some bluish discoloration on the nailbeds of the left hand where I was at.

Q: Where was Dr. Orlino Ho[s]aka then at that particular time?

A: I saw him approaching the patient during that time.

Q: When he approached the patient, what did he do, if any?

A: He made an order to call on the anesthesiologist in the person of Dr. Calderon.

Q: Did Dr. Calderon, upon being called, arrive inside the operating room?

A: Yes sir.

Q: What did [s]he do, if any?

A: [S]he tried to intubate the patient.

Q: What happened to the patient?

A: When Dr. Calderon try (sic) to intubate the patient, after a while the patient's nailbed became
bluish and I saw the patient was placed in trendelenburg position.

xxx xxx xxx

Q: Do you know the reason why the patient was placed in that trendelenburg position?

A: As far as I know, when a patient is in that position, there is a decrease of blood supply to the
brain. 46

xxx xxx xxx

The appellate court, however, disbelieved Dean Cruz's testimony in the trial court by declaring that:

A perusal of the standard nursing curriculum in our country will show that intubation is not taught as part of nursing
procedures and techniques. Indeed, we take judicial notice of the fact that nurses do not, and cannot, intubate. Even
on the assumption that she is fully capable of determining whether or not a patient is properly intubated, witness
Herminda Cruz, admittedly, did not peep into the throat of the patient. (TSN, July 25, 1991, p. 13). More importantly,
there is no evidence that she ever auscultated the patient or that she conducted any type of examination to check
if the endotracheal tube was in its proper place, and to determine the condition of the heart, lungs, and other organs.
Thus, witness Cruz's categorical statements that appellant Dra. Gutierrez failed to intubate the appellee Erlinda
Ramos and that it was Dra. Calderon who succeeded in doing so clearly suffer from lack of sufficient factual bases.
47
In other words, what the Court of Appeals is trying to impress is that being a nurse, and considered a layman in the process of
intubation, witness Cruz is not competent to testify on whether or not the intubation was a success.

We do not agree with the above reasoning of the appellate court. Although witness Cruz is not an anesthesiologist, she can very well
testify upon matters on which she is capable of observing such as, the statements and acts of the physician and surgeon, external
appearances, and manifest conditions which are observable by any one. 48 This is precisely allowed under the doctrine of res ipsa
loquitur where the testimony of expert witnesses is not required. It is the accepted rule that expert testimony is not necessary for the
proof of negligence in non-technical matters or those of which an ordinary person may be expected to have knowledge, or where the
lack of skill or want of care is so obvious as to render expert testimony unnecessary. 49 We take judicial notice of the fact that
anesthesia procedures have become so common, that even an ordinary person can tell if it was administered properly. As such, it
would not be too difficult to tell if the tube was properly inserted. This kind of observation, we believe, does not require a medical
degree to be acceptable.

At any rate, without doubt, petitioner's witness, an experienced clinical nurse whose long experience and scholarship led to her
appointment as Dean of the Capitol Medical Center School at Nursing, was fully capable of determining whether or not the intubation
was a success. She had extensive clinical experience starting as a staff nurse in Chicago, Illinois; staff nurse and clinical instructor in a
teaching hospital, the FEU-NRMF; Dean of the Laguna College of Nursing in San Pablo City; and then Dean of the Capitol Medical Center
School of Nursing. 50 Reviewing witness Cruz' statements, we find that the same were delivered in a straightforward manner, with
the kind of detail, clarity, consistency and spontaneity which would have been difficult to fabricate. With her clinical background as a
nurse, the Court is satisfied that she was able to demonstrate through her testimony what truly transpired on that fateful day.

Most of all, her testimony was affirmed by no less than respondent Dra. Gutierrez who admitted that she experienced difficulty in
inserting the tube into Erlinda's trachea, to wit:

ATTY. LIGSAY:

Q: In this particular case, Doctora, while you were intubating at your first attempt (sic), you did not
immediately see the trachea?

DRA. GUTIERREZ:

A: Yes sir.

Q: Did you pull away the tube immediately?

A: You do not pull the . . .

Q: Did you or did you not?

A: I did not pull the tube.

Q: When you said "mahirap yata ito," what were you referring to?

A: "Mahirap yata itong i-intubate," that was the patient.

Q: So, you found some difficulty in inserting the tube?

A: Yes, because of (sic) my first attempt, I did not see right away. 51

Curiously in the case at bar, respondent Dra. Gutierrez made the haphazard defense that she encountered hardship in the insertion
of the tube in the trachea of Erlinda because it was positioned more anteriorly (slightly deviated from the normal anatomy of a person)
52 making it harder to locate and, since Erlinda is obese and has a short neck and protruding teeth, it made intubation even more
difficult.
The argument does not convince us. If this was indeed observed, private respondents adduced no evidence demonstrating that they
proceeded to make a thorough assessment of Erlinda's airway, prior to the induction of anesthesia, even if this would mean postponing
the procedure. From their testimonies, it appears that the observation was made only as an afterthought, as a means of defense.

The pre-operative evaluation of a patient prior to the administration of anesthesia is universally observed to lessen the possibility of
anesthetic accidents. Pre-operative evaluation and preparation for anesthesia begins when the anesthesiologist reviews the patient's
medical records and visits with the patient, traditionally, the day before elective surgery. 53 It includes taking the patient's medical
history, review of current drug therapy, physical examination and interpretation of laboratory data. 54 The physical examination
performed by the anesthesiologist is directed primarily toward the central nervous system, cardiovascular system, lungs and upper
airway. 55 A thorough analysis of the patient's airway normally involves investigating the following: cervical spine mobility,
temporomandibular mobility, prominent central incisors, diseased or artificial teeth, ability to visualize uvula and the thyromental
distance. 56 Thus, physical characteristics of the patient's upper airway that could make tracheal intubation difficult should be studied.
57 Where the need arises, as when initial assessment indicates possible problems (such as the alleged short neck and protruding teeth
of Erlinda) a thorough examination of the patient's airway would go a long way towards decreasing patient morbidity and mortality.

In the case at bar, respondent Dra. Gutierrez admitted that she saw Erlinda for the first time on the day of the operation itself, on 17
June 1985. Before this date, no prior consultations with, or pre-operative evaluation of Erlinda was done by her. Until the day of the
operation, respondent Dra. Gutierrez was unaware of the physiological make-up and needs of Erlinda. She was likewise not properly
informed of the possible difficulties she would face during the administration of anesthesia to Erlinda. Respondent Dra. Gutierrez' act
of seeing her patient for the first time only an hour before the scheduled operative procedure was, therefore, an act of exceptional
negligence and professional irresponsibility. The measures cautioning prudence and vigilance in dealing with human lives lie at the
core of the physician's centuries-old Hippocratic Oath. Her failure to follow this medical procedure is, therefore, a clear indicia of her
negligence.

Respondent Dra. Gutierrez, however, attempts to gloss over this omission by playing around with the trial court's ignorance of clinical
procedure, hoping that she could get away with it. Respondent Dra. Gutierrez tried to muddle the difference between an elective
surgery and an emergency surgery just so her failure to perform the required pre-operative evaluation would escape unnoticed. In
her testimony she asserted:

ATTY. LIGSAY:

Q: Would you agree, Doctor, that it is good medical practice to see the patient a day before so you
can introduce yourself to establish good doctor-patient relationship and gain the trust and
confidence of the patient?

DRA. GUTIERREZ:

A: As I said in my previous statement, it depends on the operative procedure of the

anesthesiologist and in my case, with elective cases and normal cardio-pulmonary clearance like
that, I usually don't do it except on emergency and on cases that have an abnormalities (sic). 58

However, the exact opposite is true. In an emergency procedure, there is hardly enough time available for the fastidious demands of
pre-operative procedure so that an anesthesiologist is able to see the patient only a few minutes before surgery, if at all. Elective
procedures, on the other hand, are operative procedures that can wait for days, weeks or even months. Hence, in these cases, the
anesthesiologist possesses the luxury of time to be at the patient's beside to do a proper interview and clinical evaluation. There is
ample time to explain the method of anesthesia, the drugs to be used, and their possible hazards for purposes of informed consent.
Usually, the pre-operative assessment is conducted at least one day before the intended surgery, when the patient is relaxed and
cooperative.

Erlinda's case was elective and this was known to respondent Dra. Gutierrez. Thus, she had all the time to make a thorough evaluation
of Erlinda's case prior to the operation and prepare her for anesthesia. However, she never saw the patient at the bedside. She herself
admitted that she had seen petitioner only in the operating room, and only on the actual date of the cholecystectomy. She negligently
failed to take advantage of this important opportunity. As such, her attempt to exculpate herself must fail.

Having established that respondent Dra. Gutierrez failed to perform pre-operative evaluation of the patient which, in turn, resulted
to a wrongful intubation, we now determine if the faulty intubation is truly the proximate cause of Erlinda's comatose condition.
Private respondents repeatedly hammered the view that the cerebral anoxia which led to Erlinda's coma was due to bronchospasm
59 mediated by her allergic response to the drug, Thiopental Sodium, introduced into her system. Towards this end, they presented
Dr. Jamora, a Fellow of the Philippine College of Physicians and Diplomate of the Philippine Specialty Board of Internal Medicine, who
advanced private respondents' theory that the oxygen deprivation which led to anoxic encephalopathy, 60 was due to an
unpredictable drug reaction to the short-acting barbiturate. We find the theory of private respondents unacceptable.

First of all, Dr. Jamora cannot be considered an authority in the field of anesthesiology simply because he is not an anesthesiologist.
Since Dr. Jamora is a pulmonologist, he could not have been capable of properly enlightening the court about anesthesia practice and
procedure and their complications. Dr. Jamora is likewise not an allergologist and could not therefore properly advance expert opinion
on allergic-mediated processes. Moreover, he is not a pharmacologist and, as such, could not have been capable, as an expert would,
of explaining to the court the pharmacologic and toxic effects of the supposed culprit, Thiopental Sodium (Pentothal).

The inappropriateness and absurdity of accepting Dr. Jamora's testimony as an expert witness in the anesthetic practice of Pentothal
administration is further supported by his own admission that he formulated his opinions on the drug not from the practical experience
gained by a specialist or expert in the administration and use of Sodium Pentothal on patients, but only from reading certain
references, to wit:

ATTY. LIGSAY:

Q: In your line of expertise on pulmonology, did you have any occasion to use pentothal as a
method of management?

DR. JAMORA:

A: We do it in conjunction with the anesthesiologist when they have to intubate our patient.

Q: But not in particular when you practice pulmonology?

A: No.

Q: In other words, your knowledge about pentothal is based only on what you have read from
books and not by your own personal application of the medicine pentothal?

A: Based on my personal experience also on pentothal.

Q: How many times have you used pentothal?

A: They used it on me. I went into bronchospasm during my appendectomy.

Q: And because they have used it on you and on account of your own personal experience you feel
that you can testify on pentothal here with medical authority?

A: No. That is why I used references to support my claims. 61

An anesthetic accident caused by a rare drug-induced bronchospasm properly falls within the fields of anesthesia, internal medicine-
allergy, and clinical pharmacology. The resulting anoxic encephalopathy belongs to the field of neurology. While admittedly, many
bronchospastic-mediated pulmonary diseases are within the expertise of pulmonary medicine, Dr. Jamora's field, the anesthetic drug-
induced, allergic mediated bronchospasm alleged in this case is within the disciplines of anesthesiology, allergology and pharmacology.
On the basis of the foregoing transcript, in which the pulmonologist himself admitted that he could not testify about the drug with
medical authority, it is clear that the appellate court erred in giving weight to Dr. Jamora's testimony as an expert in the administration
of Thiopental Sodium.

The provision in the rules of evidence 62 regarding expert witnesses states:

Sec. 49. Opinion of expert witness. — The opinion of a witness on a matter requiring special knowledge, skill,
experience or training which he is shown to possess, may be received in evidence.
Generally, to qualify as an expert witness, one must have acquired special knowledge of the subject matter about which he or she is
to testify, either by the study of recognized authorities on the subject or by practical experience. 63 Clearly, Dr. Jamora does not qualify
as an expert witness based on the above standard since he lacks the necessary knowledge, skill, and training in the field of
anesthesiology. Oddly, apart from submitting testimony from a specialist in the wrong field, private respondents' intentionally avoided
providing testimony by competent and independent experts in the proper areas.

Moreover, private respondents' theory, that Thiopental Sodium may have produced Erlinda's coma by triggering an allergic mediated
response, has no support in evidence. No evidence of stridor, skin reactions, or wheezing — some of the more common accompanying
signs of an allergic reaction — appears on record. No laboratory data were ever presented to the court.

In any case, private respondents themselves admit that Thiopental induced, allergic-mediated bronchospasm happens only very rarely.
If courts were to accept private respondents' hypothesis without supporting medical proof, and against the weight of available
evidence, then every anesthetic accident would be an act of God. Evidently, the Thiopental-allergy theory vigorously asserted by
private respondents was a mere afterthought. Such an explanation was advanced in order to advanced in order to absolve them of
any and all responsibility for the patient's condition.

In view of the evidence at hand, we are inclined to believe petitioners' stand that it was the faulty intubation which was the proximate
cause of Erlinda's comatose condition.

Proximate cause has been defined as that which, in natural and continuous sequence, unbroken by any efficient intervening cause,
produces injury, and without which the result would not have occurred. 64 An injury or damage is proximately caused by an act or a
failure to act, whenever it appears from the evidence in the case, that the act or omission played a substantial part in bringing about
or actually causing the injury or damage; and that the injury or damage was either a direct result or a reasonably probable consequence
of the act or omission. 65 It is the dominant, moving or producing cause.

Applying the above definition in relation to the evidence at hand, faulty intubation is undeniably the proximate cause which triggered
the chain of events leading to Erlinda's brain damage and, ultimately, her comatosed condition.

Private respondents themselves admitted in their testimony that the first intubation was a failure. This fact was likewise observed by
witness Cruz when she heard respondent Dra. Gutierrez remarked, "Ang hirap ma-intubate nito, mali yata ang pagkakapasok. O
lumalaki ang tiyan." Thereafter, witness Cruz noticed abdominal distention on the body of Erlinda. The development of abdominal
distention, together with respiratory embarrassment indicates that the endotracheal tube entered the esophagus instead of the
respiratory tree. In other words, instead of the intended endotracheal intubation what actually took place was an esophageal
intubation. During intubation, such distention indicates that air has entered the gastrointestinal tract through the esophagus instead
of the lungs through the trachea. Entry into the esophagus would certainly cause some delay in oxygen delivery into the lungs as the
tube which carries oxygen is in the wrong place. That abdominal distention had been observed during the first intubation suggests
that the length of time utilized in inserting the endotracheal tube (up to the time the tube was withdrawn for the second attempt)
was fairly significant. Due to the delay in the delivery of oxygen in her lungs Erlinda showed signs of cyanosis. 66 As stated in the
testimony of Dr. Hosaka, the lack of oxygen became apparent only after he noticed that the nailbeds of Erlinda were already blue. 67
However, private respondents contend that a second intubation was executed on Erlinda and this one was successfully done. We do
not think so. No evidence exists on record, beyond private respondents' bare claims, which supports the contention that the second
intubation was successful. Assuming that the endotracheal tube finally found its way into the proper orifice of the trachea, the same
gave no guarantee of oxygen delivery, the hallmark of a successful intubation. In fact, cyanosis was again observed immediately after
the second intubation. Proceeding from this event (cyanosis), it could not be claimed, as private respondents insist, that the second
intubation was accomplished. Even granting that the tube was successfully inserted during the second attempt, it was obviously too
late. As aptly explained by the trial court, Erlinda already suffered brain damage as a result of the inadequate oxygenation of her brain
for about four to five minutes. 68

The above conclusion is not without basis. Scientific studies point out that intubation problems are responsible for one-third (1/3) of
deaths and serious injuries associated with anesthesia. 69 Nevertheless, ninety-eight percent (98%) or the vast majority of difficult
intubations may be anticipated by performing a thorough evaluation of the patient's airway prior to the operation. 70 As stated
beforehand, respondent Dra. Gutierrez failed to observe the proper pre-operative protocol which could have prevented this
unfortunate incident. Had appropriate diligence and reasonable care been used in the pre-operative evaluation, respondent physician
could have been much more prepared to meet the contingency brought about by the perceived anatomic variations in the patient's
neck and oral area, defects which would have been easily overcome by a prior knowledge of those variations together with a change
in technique. 71 In other words, an experienced anesthesiologist, adequately alerted by a thorough pre-operative evaluation, would
have had little difficulty going around the short neck and protruding teeth. 72 Having failed to observe common medical standards in
pre-operative management and intubation, respondent Dra. Gutierrez' negligence resulted in cerebral anoxia and eventual coma of
Erlinda.

We now determine the responsibility of respondent Dr. Orlino Hosaka as the head of the surgical team. As the so-called "captain of
the ship," 73 it is the surgeon's responsibility to see to it that those under him perform their task in the proper manner. Respondent
Dr. Hosaka's negligence can be found in his failure to exercise the proper authority (as the "captain" of the operative team) in not
determining if his anesthesiologist observed proper anesthesia protocols. In fact, no evidence on record exists to show that respondent
Dr. Hosaka verified if respondent Dra. Gutierrez properly intubated the patient. Furthermore, it does not escape us that respondent
Dr. Hosaka had scheduled another procedure in a different hospital at the same time as Erlinda's cholecystectomy, and was in fact
over three hours late for the latter's operation. Because of this, he had little or no time to confer with his anesthesiologist regarding
the anesthesia delivery. This indicates that he was remiss in his professional duties towards his patient. Thus, he shares equal
responsibility for the events which resulted in Erlinda's condition.

We now discuss the responsibility of the hospital in this particular incident. The unique practice (among private hospitals) of filling up
specialist staff with attending and visiting "consultants," 74 who are allegedly not hospital employees, presents problems in
apportioning responsibility for negligence in medical malpractice cases. However, the difficulty is only more apparent than real.

In the first place, hospitals exercise significant control in the hiring and firing of consultants and in the conduct of their work within
the hospital premises. Doctors who apply for "consultant" slots, visiting or attending, are required to submit proof of completion of
residency, their educational qualifications; generally, evidence of accreditation by the appropriate board (diplomate), evidence of
fellowship in most cases, and references. These requirements are carefully scrutinized by members of the hospital administration or
by a review committee set up by the hospital who either accept or reject the application. 75 This is particularly true with respondent
hospital.

After a physician is accepted, either as a visiting or attending consultant, he is normally required to attend clinico-pathological
conferences, conduct bedside rounds for clerks, interns and residents, moderate grand rounds and patient audits and perform other
tasks and responsibilities, for the privilege of being able to maintain a clinic in the hospital, and/or for the privilege of admitting
patients into the hospital. In addition to these, the physician's performance as a specialist is generally evaluated by a peer review
committee on the basis of mortality and morbidity statistics, and feedback from patients, nurses, interns and residents. A consultant
remiss in his duties, or a consultant who regularly falls short of the minimum standards acceptable to the hospital or its peer review
committee, is normally politely terminated.

In other words, private hospitals, hire, fire and exercise real control over their attending and visiting "consultant" staff. While
"consultants" are not, technically employees, a point which respondent hospital asserts in denying all responsibility for the patient's
condition, the control exercised, the hiring, and the right to terminate consultants all fulfill the important hallmarks of an employer-
employee relationship, with the exception of the payment of wages. In assessing whether such a relationship in fact exists, the control
test is determining. Accordingly, on the basis of the foregoing, we rule that for the purpose of allocating responsibility in medical
negligence cases, an employer-employee relationship in effect exists between hospitals and their attending and visiting physicians.
This being the case, the question now arises as to whether or not respondent hospital is solidarily liable with respondent doctors for
petitioner's condition. 76

The basis for holding an employer solidarily responsible for the negligence of its employee is found in Article 2180 of the Civil Code
which considers a person accountable not only for his own acts but also for those of others based on the former's responsibility under
a relationship of patria potestas. 77 Such responsibility ceases when the persons or entity concerned prove that they have observed
the diligence of a good father of the family to prevent damage. 78 In other words, while the burden of proving negligence rests on the
plaintiffs, once negligence is shown, the burden shifts to the respondents (parent, guardian, teacher or employer) who should prove
that they observed the diligence of a good father of a family to prevent damage.

In the instant case, respondent hospital, apart from a general denial of its responsibility over respondent physicians, failed to adduce
evidence showing that it exercised the diligence of a good father of a family in the hiring and supervision of the latter. It failed to
adduce evidence with regard to the degree of supervision which it exercised over its physicians. In neglecting to offer such proof, or
proof of a similar nature, respondent hospital thereby failed to discharge its burden under the last paragraph of Article 2180. Having
failed to do this, respondent hospital is consequently solidarily responsible with its physicians for Erlinda's condition.

Based on the foregoing, we hold that the Court of Appeals erred in accepting and relying on the testimonies of the witnesses for the
private respondents. Indeed, as shown by the above discussions, private respondents were unable to rebut the presumption of
negligence. Upon these disquisitions we hold that private respondents are solidarily liable for damages under Article 2176 79 of the
Civil Code.

We now come to the amount of damages due petitioners. The trial court awarded a total of P632,000.00 pesos (should be
P616,000.00) in compensatory damages to the plaintiff, "subject to its being updated" covering the period from 15 November 1985
up to 15 April 1992, based on monthly expenses for the care of the patient estimated at P8,000.00.

At current levels, the P8000/monthly amount established by the trial court at the time of its decision would be grossly inadequate to
cover the actual costs of home-based care for a comatose individual. The calculated amount was not even arrived at by looking at the
actual cost of proper hospice care for the patient. What it reflected were the actual expenses incurred and proved by the petitioners
after they were forced to bring home the patient to avoid mounting hospital bills.

And yet ideally, a comatose patient should remain in a hospital or be transferred to a hospice specializing in the care of the chronically
ill for the purpose of providing a proper milieu adequate to meet minimum standards of care. In the instant case for instance, Erlinda
has to be constantly turned from side to side to prevent bedsores and hypostatic pneumonia. Feeding is done by nasogastric tube.
Food preparation should be normally made by a dietitian to provide her with the correct daily caloric requirements and vitamin
supplements. Furthermore, she has to be seen on a regular basis by a physical therapist to avoid muscle atrophy, and by a pulmonary
therapist to prevent the accumulation of secretions which can lead to respiratory complications.

Given these considerations, the amount of actual damages recoverable in suits arising from negligence should at least reflect the
correct minimum cost of proper care, not the cost of the care the family is usually compelled to undertake at home to avoid
bankruptcy. However, the provisions of the Civil Code on actual or compensatory damages present us with some difficulties.

Well-settled is the rule that actual damages which may be claimed by the plaintiff are those suffered by him as he has duly proved.
The Civil Code provides:

Art. 2199. — Except as provided by law or by stipulation, one is entitled to an adequate compensation only for such
pecuniary loss suffered by him as he has duly proved. Such compensation is referred to as actual or compensatory
damages.

Our rules on actual or compensatory damages generally assume that at the time of litigation, the injury suffered as a consequence of
an act of negligence has been completed and that the cost can be liquidated. However, these provisions neglect to take into account
those situations, as in this case, where the resulting injury might be continuing and possible future complications directly arising from
the injury, while certain to occur, are difficult to predict.

In these cases, the amount of damages which should be awarded, if they are to adequately and correctly respond to the injury caused,
should be one which compensates for pecuniary loss incurred and proved, up to the time of trial; and one which would meet pecuniary
loss certain to be suffered but which could not, from the nature of the case, be made with certainty. 80 In other words, temperate
damages can and should be awarded on top of actual or compensatory damages in instances where the injury is chronic and
continuing. And because of the unique nature of such cases, no incompatibility arises when both actual and temperate damages are
provided for. The reason is that these damages cover two distinct phases.

As it would not be equitable — and certainly not in the best interests of the administration of justice — for the victim in such cases to
constantly come before the courts and invoke their aid in seeking adjustments to the compensatory damages previously awarded —
temperate damages are appropriate. The amount given as temperate damages, though to a certain extent speculative, should take
into account the cost of proper care.

In the instant case, petitioners were able to provide only home-based nursing care for a comatose patient who has remained in that
condition for over a decade. Having premised our award for compensatory damages on the amount provided by petitioners at the
onset of litigation, it would be now much more in step with the interests of justice if the value awarded for temperate damages would
allow petitioners to provide optimal care for their loved one in a facility which generally specializes in such care. They should not be
compelled by dire circumstances to provide substandard care at home without the aid of professionals, for anything less would be
grossly inadequate. Under the circumstances, an award of P1,500,000.00 in temperate damages would therefore be reasonable. 81

In Valenzuela vs. Court of Appeals, 82 this Court was confronted with a situation where the injury suffered by the plaintiff would have
led to expenses which were difficult to estimate because while they would have been a direct result of the injury (amputation), and
were certain to be incurred by the plaintiff, they were likely to arise only in the future. We awarded P1,000,000.00 in moral damages
in that case.

Describing the nature of the injury, the Court therein stated:

As a result of the accident, Ma. Lourdes Valenzuela underwent a traumatic amputation of her left lower extremity
at the distal left thigh just above the knee. Because of this, Valenzuela will forever be deprived of the full ambulatory
functions of her left extremity, even with the use of state of the art prosthetic technology. Well beyond the period
of hospitalization (which was paid for by Li), she will be required to undergo adjustments in her prosthetic devise
due to the shrinkage of the stump from the process of healing.

These adjustments entail costs, prosthetic replacements and months of physical and occupational rehabilitation and
therapy. During the lifetime, the prosthetic devise will have to be replaced and readjusted to changes in the size of
her lower limb effected by the biological changes of middle-age, menopause and aging. Assuming she reaches
menopause, for example, the prosthetic will have to be adjusted to respond to the changes in bone resulting from a
precipitate decrease in calcium levels observed in the bones of all post-menopausal women. In other words, the
damage done to her would not only be permanent and lasting, it would also be permanently changing and adjusting
to the physiologic changes which her body would normally undergo through the years. The replacements, changes,
and adjustments will require corresponding adjustive physical and occupational therapy. All of these adjustments, it
has been documented, are painful.

xxx xxx xxx

A prosthetic devise, however technologically advanced, will only allow a reasonable amount of functional restoration
of the motor functions of the lower limb. The sensory functions are forever lost. The resultant anxiety, sleeplessness,
psychological injury, mental and physical pain are inestimable. 83

The injury suffered by Erlinda as a consequence of private respondents' negligence is certainly much more serious than the amputation
in the Valenzuela case.

Petitioner Erlinda Ramos was in her mid-forties when the incident occurred. She has been in a comatose state for over fourteen years
now. The burden of care has so far been heroically shouldered by her husband and children, who, in the intervening years have been
deprived of the love of a wife and a mother.

Meanwhile, the actual physical, emotional and financial cost of the care of petitioner would be virtually impossible to quantify. Even
the temperate damages herein awarded would be inadequate if petitioner's condition remains unchanged for the next ten years.

We recognized, in Valenzuela that a discussion of the victim's actual injury would not even scratch the surface of the resulting moral
damage because it would be highly speculative to estimate the amount of emotional and moral pain, psychological damage and injury
suffered by the victim or those actually affected by the victim's condition. 84 The husband and the children, all petitioners in this case,
will have to live with the day to day uncertainty of the patient's illness, knowing any hope of recovery is close to nil. They have
fashioned their daily lives around the nursing care of petitioner, altering their long term goals to take into account their life with a
comatose patient. They, not the respondents, are charged with the moral responsibility of the care of the victim. The family's moral
injury and suffering in this case is clearly a real one. For the foregoing reasons, an award of P2,000,000.00 in moral damages would be
appropriate.

Finally, by way of example, exemplary damages in the amount of P100,000.00 are hereby awarded. Considering the length and nature
of the instant suit we are of the opinion that attorney's fees valued at P100,000.00 are likewise proper.

Our courts face unique difficulty in adjudicating medical negligence cases because physicians are not insurers of life and, they rarely
set out to intentionally cause injury or death to their patients. However, intent is immaterial in negligence cases because where
negligence exists and is proven, the same automatically gives the injured a right to reparation for the damage caused.

Established medical procedures and practices, though in constant flux are devised for the purpose of preventing complications. A
physician's experience with his patients would sometimes tempt him to deviate from established community practices, and he may
end a distinguished career using unorthodox methods without incident. However, when failure to follow established procedure results
in the evil precisely sought to be averted by observance of the procedure and a nexus is made between the deviation and the injury
or damage, the physician would necessarily be called to account for it. In the case at bar, the failure to observe pre-operative
assessment protocol which would have influenced the intubation in a salutary way was fatal to private respondents' case.

WHEREFORE, the decision and resolution of the appellate court appealed from are hereby modified so as to award in favor of
petitioners, and solidarily against private respondents the following: 1) P1,352,000.00 as actual damages computed as of the date of
promulgation of this decision plus a monthly payment of P8,000.00 up to the time that petitioner Erlinda Ramos expires or
miraculously survives; 2) P2,000,000.00 as moral damages, 3) P1,500,000.00 as temperate damages; 4) P100,000.00 each as exemplary
damages and attorney's fees; and, 5) the costs of the suit.

SO ORDERED.

Davide, Jr., C.J., Puno, Pardo and Ynares-Santiago, JJ., concur.

 THIRD DIVISION

G.R. No. 142625 December 19, 2006

ROGELIO P. NOGALES, for himself and on behalf of the minors, ROGER ANTHONY, ANGELICA, NANCY, and MICHAEL
CHRISTOPHER, all surnamed NOGALES, petitioners,
vs.
CAPITOL MEDICAL CENTER, DR. OSCAR ESTRADA, DR. ELY VILLAFLOR, DR. ROSA UY, DR. JOEL ENRIQUEZ, DR. PERPETUA LACSON,
DR. NOE ESPINOLA, and NURSE J. DUMLAO, respondents.

DECISION

CARPIO, J.:

The Case

This petition for review1 assails the 6 February 1998 Decision2 and 21 March 2000 Resolution3 of the Court of Appeals in CA-G.R. CV
No. 45641. The Court of Appeals affirmed in toto the 22 November 1993 Decision4 of the Regional Trial Court of Manila, Branch 33,
finding Dr. Oscar Estrada solely liable for damages for the death of his patient, Corazon Nogales, while absolving the remaining
respondents of any liability. The Court of Appeals denied petitioners' motion for reconsideration.

The Facts

Pregnant with her fourth child, Corazon Nogales ("Corazon"), who was then 37 years old, was under the exclusive prenatal care of Dr.
Oscar Estrada ("Dr. Estrada") beginning on her fourth month of pregnancy or as early as December 1975. While Corazon was on her
last trimester of pregnancy, Dr. Estrada noted an increase in her blood pressure and development of leg edema 5 indicating
preeclampsia,6 which is a dangerous complication of pregnancy.7

Around midnight of 25 May 1976, Corazon started to experience mild labor pains prompting Corazon and Rogelio Nogales ("Spouses
Nogales") to see Dr. Estrada at his home. After examining Corazon, Dr. Estrada advised her immediate admission to the Capitol Medical
Center ("CMC").

On 26 May 1976, Corazon was admitted at 2:30 a.m. at the CMC after the staff nurse noted the written admission request 8 of Dr.
Estrada. Upon Corazon's admission at the CMC, Rogelio Nogales ("Rogelio") executed and signed the "Consent on Admission and
Agreement"9 and "Admission Agreement."10 Corazon was then brought to the labor room of the CMC.

Dr. Rosa Uy ("Dr. Uy"), who was then a resident physician of CMC, conducted an internal examination of Corazon. Dr. Uy then called
up Dr. Estrada to notify him of her findings.

Based on the Doctor's Order Sheet,11 around 3:00 a.m., Dr. Estrada ordered for 10 mg. of valium to be administered immediately by
intramuscular injection. Dr. Estrada later ordered the start of intravenous administration of syntocinon admixed with dextrose, 5%, in
lactated Ringers' solution, at the rate of eight to ten micro-drops per minute.
According to the Nurse's Observation Notes,12 Dr. Joel Enriquez ("Dr. Enriquez"), an anesthesiologist at CMC, was notified at 4:15 a.m.
of Corazon's admission. Subsequently, when asked if he needed the services of an anesthesiologist, Dr. Estrada refused. Despite Dr.
Estrada's refusal, Dr. Enriquez stayed to observe Corazon's condition.

At 6:00 a.m., Corazon was transferred to Delivery Room No. 1 of the CMC. At 6:10 a.m., Corazon's bag of water ruptured
spontaneously. At 6:12 a.m., Corazon's cervix was fully dilated. At 6:13 a.m., Corazon started to experience convulsions.

At 6:15 a.m., Dr. Estrada ordered the injection of ten grams of magnesium sulfate. However, Dr. Ely Villaflor ("Dr. Villaflor"), who was
assisting Dr. Estrada, administered only 2.5 grams of magnesium sulfate.

At 6:22 a.m., Dr. Estrada, assisted by Dr. Villaflor, applied low forceps to extract Corazon's baby. In the process, a 1.0 x 2.5 cm. piece
of cervical tissue was allegedly torn. The baby came out in an apnic, cyanotic, weak and injured condition. Consequently, the baby had
to be intubated and resuscitated by Dr. Enriquez and Dr. Payumo.

At 6:27 a.m., Corazon began to manifest moderate vaginal bleeding which rapidly became profuse. Corazon's blood pressure dropped
from 130/80 to 60/40 within five minutes. There was continuous profuse vaginal bleeding. The assisting nurse administered hemacel
through a gauge 19 needle as a side drip to the ongoing intravenous injection of dextrose.

At 7:45 a.m., Dr. Estrada ordered blood typing and cross matching with bottled blood. It took approximately 30 minutes for the CMC
laboratory, headed by Dr. Perpetua Lacson ("Dr. Lacson"), to comply with Dr. Estrada's order and deliver the blood.

At 8:00 a.m., Dr. Noe Espinola ("Dr. Espinola"), head of the Obstetrics-Gynecology Department of the CMC, was apprised of Corazon's
condition by telephone. Upon being informed that Corazon was bleeding profusely, Dr. Espinola ordered immediate hysterectomy.
Rogelio was made to sign a "Consent to Operation."13

Due to the inclement weather then, Dr. Espinola, who was fetched from his residence by an ambulance, arrived at the CMC about an
hour later or at 9:00 a.m. He examined the patient and ordered some resuscitative measures to be administered. Despite Dr. Espinola's
efforts, Corazon died at 9:15 a.m. The cause of death was "hemorrhage, post partum."14

On 14 May 1980, petitioners filed a complaint for damages 15 with the Regional Trial Court16 of Manila against CMC, Dr. Estrada, Dr.
Villaflor, Dr. Uy, Dr. Enriquez, Dr. Lacson, Dr. Espinola, and a certain Nurse J. Dumlao for the death of Corazon. Petitioners mainly
contended that defendant physicians and CMC personnel were negligent in the treatment and management of Corazon's condition.
Petitioners charged CMC with negligence in the selection and supervision of defendant physicians and hospital staff.

For failing to file their answer to the complaint despite service of summons, the trial court declared Dr. Estrada, Dr. Enriquez, and
Nurse Dumlao in default.17 CMC, Dr. Villaflor, Dr. Uy, Dr. Espinola, and Dr. Lacson filed their respective answers denying and opposing
the allegations in the complaint. Subsequently, trial ensued.

After more than 11 years of trial, the trial court rendered judgment on 22 November 1993 finding Dr. Estrada solely liable for damages.
The trial court ruled as follows:

The victim was under his pre-natal care, apparently, his fault began from his incorrect and inadequate management and lack
of treatment of the pre-eclamptic condition of his patient. It is not disputed that he misapplied the forceps in causing the
delivery because it resulted in a large cervical tear which had caused the profuse bleeding which he also failed to control with
the application of inadequate injection of magnesium sulfate by his assistant Dra. Ely Villaflor. Dr. Estrada even failed to notice
the erroneous administration by nurse Dumlao of hemacel by way of side drip, instead of direct intravenous injection, and
his failure to consult a senior obstetrician at an early stage of the problem.

On the part however of Dra. Ely Villaflor, Dra. Rosa Uy, Dr. Joel Enriquez, Dr. Lacson, Dr. Espinola, nurse J. Dumlao and CMC,
the Court finds no legal justification to find them civilly liable.

On the part of Dra. Ely Villaflor, she was only taking orders from Dr. Estrada, the principal physician of Corazon Nogales. She
can only make suggestions in the manner the patient maybe treated but she cannot impose her will as to do so would be to
substitute her good judgment to that of Dr. Estrada. If she failed to correctly diagnose the true cause of the bleeding which
in this case appears to be a cervical laceration, it cannot be safely concluded by the Court that Dra. Villaflor had the correct
diagnosis and she failed to inform Dr. Estrada. No evidence was introduced to show that indeed Dra. Villaflor had discovered
that there was laceration at the cervical area of the patient's internal organ.
 On the part of nurse Dumlao, there is no showing that when she administered the hemacel as a side drip, she did it on her
own. If the correct procedure was directly thru the veins, it could only be because this was what was probably the orders of
Dr. Estrada.

While the evidence of the plaintiffs shows that Dr. Noe Espinola, who was the Chief of the Department of Obstetrics and
Gynecology who attended to the patient Mrs. Nogales, it was only at 9:00 a.m. That he was able to reach the hospital because
of typhoon Didang (Exhibit 2). While he was able to give prescription in the manner Corazon Nogales may be treated, the
prescription was based on the information given to him by phone and he acted on the basis of facts as presented to him,
believing in good faith that such is the correct remedy. He was not with Dr. Estrada when the patient was brought to the
hospital at 2:30 o'clock a.m. So, whatever errors that Dr. Estrada committed on the patient before 9:00 o'clock a.m. are
certainly the errors of Dr. Estrada and cannot be the mistake of Dr. Noe Espinola. His failure to come to the hospital on time
was due to fortuitous event.

On the part of Dr. Joel Enriquez, while he was present in the delivery room, it is not incumbent upon him to call the attention
of Dr. Estrada, Dra. Villaflor and also of Nurse Dumlao on the alleged errors committed by them. Besides, as anesthesiologist,
he has no authority to control the actuations of Dr. Estrada and Dra. Villaflor. For the Court to assume that there were errors
being committed in the presence of Dr. Enriquez would be to dwell on conjectures and speculations.

On the civil liability of Dr. Perpetua Lacson, [s]he is a hematologist and in-charge of the blood bank of the CMC. The Court
cannot accept the theory of the plaintiffs that there was delay in delivering the blood needed by the patient. It was testified,
that in order that this blood will be made available, a laboratory test has to be conducted to determine the type of blood,
cross matching and other matters consistent with medical science so, the lapse of 30 minutes maybe considered a reasonable
time to do all of these things, and not a delay as the plaintiffs would want the Court to believe.

Admittedly, Dra. Rosa Uy is a resident physician of the Capitol Medical Center. She was sued because of her alleged failure to
notice the incompetence and negligence of Dr. Estrada. However, there is no evidence to support such theory. No evidence
was adduced to show that Dra. Rosa Uy as a resident physician of Capitol Medical Center, had knowledge of the
mismanagement of the patient Corazon Nogales, and that notwithstanding such knowledge, she tolerated the same to
happen.

In the pre-trial order, plaintiffs and CMC agreed that defendant CMC did not have any hand or participation in the selection
or hiring of Dr. Estrada or his assistant Dra. Ely Villaflor as attending physician[s] of the deceased. In other words, the two (2)
doctors were not employees of the hospital and therefore the hospital did not have control over their professional conduct.
When Mrs. Nogales was brought to the hospital, it was an emergency case and defendant CMC had no choice but to admit
her. Such being the case, there is therefore no legal ground to apply the provisions of Article 2176 and 2180 of the New Civil
Code referring to the vicarious liability of an employer for the negligence of its employees. If ever in this case there is fault or
negligence in the treatment of the deceased on the part of the attending physicians who were employed by the family of the
deceased, such civil liability should be borne by the attending physicians under the principle of "respondeat superior".

WHEREFORE, premises considered, judgment is hereby rendered finding defendant Dr. Estrada of Number 13 Pitimini St. San
Francisco del Monte, Quezon City civilly liable to pay plaintiffs: 1) By way of actual damages in the amount of P105,000.00; 2)
By way of moral damages in the amount of P700,000.00; 3) Attorney's fees in the amount of P100,000.00 and to pay the costs
of suit.

For failure of the plaintiffs to adduce evidence to support its [sic] allegations against the other defendants, the complaint is
hereby ordered dismissed. While the Court looks with disfavor the filing of the present complaint against the other
defendants by the herein plaintiffs, as in a way it has caused them personal inconvenience and slight damage on their name
and reputation, the Court cannot accepts [sic] however, the theory of the remaining defendants that plaintiffs were motivated
in bad faith in the filing of this complaint. For this reason defendants' counterclaims are hereby ordered dismissed.

SO ORDERED.18

Petitioners appealed the trial court's decision. Petitioners claimed that aside from Dr. Estrada, the remaining respondents should be
held equally liable for negligence. Petitioners pointed out the extent of each respondent's alleged liability.

On 6 February 1998, the Court of Appeals affirmed the decision of the trial court. 19 Petitioners filed a motion for reconsideration which
the Court of Appeals denied in its Resolution of 21 March 2000. 20
Hence, this petition.

Meanwhile, petitioners filed a Manifestation dated 12 April 200221 stating that respondents Dr. Estrada, Dr. Enriquez, Dr. Villaflor, and
Nurse Dumlao "need no longer be notified of the petition because they are absolutely not involved in the issue raised before the
[Court], regarding the liability of [CMC]."22 Petitioners stressed that the subject matter of this petition is the liability of CMC for the
negligence of Dr. Estrada.23

The Court issued a Resolution dated 9 September 200224 dispensing with the requirement to submit the correct and present addresses
of respondents Dr. Estrada, Dr. Enriquez, Dr. Villaflor, and Nurse Dumlao. The Court stated that with the filing of petitioners'
Manifestation, it should be understood that they are claiming only against respondents CMC, Dr. Espinola, Dr. Lacson, and Dr. Uy who
have filed their respective comments. Petitioners are foregoing further claims against respondents Dr. Estrada, Dr. Enriquez, Dr.
Villaflor, and Nurse Dumlao.

The Court noted that Dr. Estrada did not appeal the decision of the Court of Appeals affirming the decision of the Regional Trial Court.
Accordingly, the decision of the Court of Appeals, affirming the trial court's judgment, is already final as against Dr. Oscar Estrada.

Petitioners filed a motion for reconsideration25 of the Court's 9 September 2002 Resolution claiming that Dr. Enriquez, Dr. Villaflor and
Nurse Dumlao were notified of the petition at their counsels' last known addresses. Petitioners reiterated their imputation of
negligence on these respondents. The Court denied petitioners' Motion for Reconsideration in its 18 February 2004 Resolution. 26

The Court of Appeals' Ruling

In its Decision of 6 February 1998, the Court of Appeals upheld the trial court's ruling. The Court of Appeals rejected petitioners' view
that the doctrine in Darling v. Charleston Community Memorial Hospital27 applies to this case. According to the Court of Appeals, the
present case differs from the Darling case since Dr. Estrada is an independent contractor-physician whereas the Darling case involved
a physician and a nurse who were employees of the hospital.

Citing other American cases, the Court of Appeals further held that the mere fact that a hospital permitted a physician to practice
medicine and use its facilities is not sufficient to render the hospital liable for the physician's negligence. 28 A hospital is not responsible
for the negligence of a physician who is an independent contractor. 29

The Court of Appeals found the cases of Davidson v. Conole30 and Campbell v. Emma Laing Stevens Hospital31 applicable to this case.
Quoting Campbell, the Court of Appeals stated that where there is no proof that defendant physician was an employee of defendant
hospital or that defendant hospital had reason to know that any acts of malpractice would take place, defendant hospital could not
be held liable for its failure to intervene in the relationship of physician-patient between defendant physician and plaintiff.

On the liability of the other respondents, the Court of Appeals applied the "borrowed servant" doctrine considering that Dr. Estrada
was an independent contractor who was merely exercising hospital privileges. This doctrine provides that once the surgeon enters the
operating room and takes charge of the proceedings, the acts or omissions of operating room personnel, and any negligence associated
with such acts or omissions, are imputable to the surgeon. 32 While the assisting physicians and nurses may be employed by the
hospital, or engaged by the patient, they normally become the temporary servants or agents of the surgeon in charge while the
operation is in progress, and liability may be imposed upon the surgeon for their negligent acts under the doctrine of respondeat
superior.33

The Court of Appeals concluded that since Rogelio engaged Dr. Estrada as the attending physician of his wife, any liability for
malpractice must be Dr. Estrada's sole responsibility.

While it found the amount of damages fair and reasonable, the Court of Appeals held that no interest could be imposed on
unliquidated claims or damages.

The Issue

Basically, the issue in this case is whether CMC is vicariously liable for the negligence of Dr. Estrada. The resolution of this issue rests,
on the other hand, on the ascertainment of the relationship between Dr. Estrada and CMC. The Court also believes that a
determination of the extent of liability of the other respondents is inevitable to finally and completely dispose of the present
controversy.
The Ruling of the Court

The petition is partly meritorious.

On the Liability of CMC

Dr. Estrada's negligence in handling the treatment and management of Corazon's condition which ultimately resulted in Corazon's
death is no longer in issue. Dr. Estrada did not appeal the decision of the Court of Appeals which affirmed the ruling of the trial court
finding Dr. Estrada solely liable for damages. Accordingly, the finding of the trial court on Dr. Estrada's negligence is already final.

Petitioners maintain that CMC is vicariously liable for Dr. Estrada's negligence based on Article 2180 in relation to Article 2176 of the
Civil Code. These provisions pertinently state:

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.

xxxx

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 in any business or industry.

xxxx

The responsibility treated of in this article shall cease when the persons herein mentioned prove that they observed all the
diligence of a good father of a family to prevent damage.

Art. 2176. Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the
damage done. Such fault or negligence, if there is no pre-existing contractual relation between the parties, is called a quasi-
delict and is governed by the provisions of this Chapter.

Similarly, in the United States, a hospital which is the employer, master, or principal of a physician employee, servant, or agent, may
be held liable for the physician's negligence under the doctrine of respondeat superior.34

In the present case, petitioners maintain that CMC, in allowing Dr. Estrada to practice and admit patients at CMC, should be liable for
Dr. Estrada's malpractice. Rogelio claims that he knew Dr. Estrada as an accredited physician of CMC, though he discovered later that
Dr. Estrada was not a salaried employee of the CMC. 35 Rogelio further claims that he was dealing with CMC, whose primary concern
was the treatment and management of his wife's condition. Dr. Estrada just happened to be the specific person he talked to
representing CMC.36 Moreover, the fact that CMC made Rogelio sign a Consent on Admission and Admission Agreement 37 and a
Consent to Operation printed on the letterhead of CMC indicates that CMC considered Dr. Estrada as a member of its medical staff.

On the other hand, CMC disclaims liability by asserting that Dr. Estrada was a mere visiting physician and that it admitted Corazon
because her physical condition then was classified an emergency obstetrics case. 38

CMC alleges that Dr. Estrada is an independent contractor "for whose actuations CMC would be a total stranger." CMC maintains that
it had no control or supervision over Dr. Estrada in the exercise of his medical profession.

The Court had the occasion to determine the relationship between a hospital and a consultant or visiting physician and the liability of
such hospital for that physician's negligence in Ramos v. Court of Appeals,39 to wit:

In the first place, hospitals exercise significant control in the hiring and firing of consultants and in the conduct of their work
within the hospital premises. Doctors who apply for "consultant" slots, visiting or attending, are required to submit proof of
completion of residency, their educational qualifications; generally, evidence of accreditation by the appropriate board
(diplomate), evidence of fellowship in most cases, and references. These requirements are carefully scrutinized by members
of the hospital administration or by a review committee set up by the hospital who either accept or reject the application.
This is particularly true with respondent hospital.
 After a physician is accepted, either as a visiting or attending consultant, he is normally required to attend clinico-pathological
conferences, conduct bedside rounds for clerks, interns and residents, moderate grand rounds and patient audits and
perform other tasks and responsibilities, for the privilege of being able to maintain a clinic in the hospital, and/or for the
privilege of admitting patients into the hospital. In addition to these, the physician's performance as a specialist is generally
evaluated by a peer review committee on the basis of mortality and morbidity statistics, and feedback from patients, nurses,
interns and residents. A consultant remiss in his duties, or a consultant who regularly falls short of the minimum standards
acceptable to the hospital or its peer review committee, is normally politely terminated.

In other words, private hospitals, hire, fire and exercise real control over their attending and visiting "consultant" staff. While
"consultants" are not, technically employees, a point which respondent hospital asserts in denying all responsibility for
the patient's condition, the control exercised, the hiring, and the right to terminate consultants all fulfill the important
hallmarks of an employer-employee relationship, with the exception of the payment of wages. In assessing whether such
a relationship in fact exists, the control test is determining. Accordingly, on the basis of the foregoing, we rule that for the
purpose of allocating responsibility in medical negligence cases, an employer-employee relationship in effect exists
between hospitals and their attending and visiting physicians. This being the case, the question now arises as to whether or
not respondent hospital is solidarily liable with respondent doctors for petitioner's condition.

The basis for holding an employer solidarily responsible for the negligence of its employee is found in Article 2180 of the Civil
Code which considers a person accountable not only for his own acts but also for those of others based on the former's
responsibility under a relationship of patria potestas. x x x40 (Emphasis supplied)

While the Court in Ramos did not expound on the control test, such test essentially determines whether an employment relationship
exists between a physician and a hospital based on the exercise of control over the physician as to details. Specifically, the employer
(or the hospital) must have the right to control both the means and the details of the process by which the employee (or the physician)
is to accomplish his task.41

After a thorough examination of the voluminous records of this case, the Court finds no single evidence pointing to CMC's exercise of
control over Dr. Estrada's treatment and management of Corazon's condition. It is undisputed that throughout Corazon's pregnancy,
she was under the exclusive prenatal care of Dr. Estrada. At the time of Corazon's admission at CMC and during her delivery, it was
Dr. Estrada, assisted by Dr. Villaflor, who attended to Corazon. There was no showing that CMC had a part in diagnosing Corazon's
condition. While Dr. Estrada enjoyed staff privileges at CMC, such fact alone did not make him an employee of CMC. 42 CMC merely
allowed Dr. Estrada to use its facilities 43 when Corazon was about to give birth, which CMC considered an emergency. Considering
these circumstances, Dr. Estrada is not an employee of CMC, but an independent contractor.

The question now is whether CMC is automatically exempt from liability considering that Dr. Estrada is an independent contractor-
physician.

In general, a hospital is not liable for the negligence of an independent contractor-physician. There is, however, an exception to this
principle. The hospital may be liable if the physician is the "ostensible" agent of the hospital. 44 This exception is also known as the
"doctrine of apparent authority."45 In Gilbert v. Sycamore Municipal Hospital,46 the Illinois Supreme Court explained the doctrine of
apparent authority in this wise:

[U]nder the doctrine of apparent authority a hospital can be held vicariously liable for the negligent acts of a physician
providing care at the hospital, regardless of whether the physician is an independent contractor, unless the patient knows,
or should have known, that the physician is an independent contractor. The elements of the action have been set out as
follows:

"For a hospital to be liable under the doctrine of apparent authority, a plaintiff must show that: (1) the hospital, or its agent,
acted in a manner that would lead a reasonable person to conclude that the individual who was alleged to be negligent was
an employee or agent of the hospital; (2) where the acts of the agent create the appearance of authority, the plaintiff must
also prove that the hospital had knowledge of and acquiesced in them; and (3) the plaintiff acted in reliance upon the conduct
of the hospital or its agent, consistent with ordinary care and prudence."

The element of "holding out" on the part of the hospital does not require an express representation by the hospital that the
person alleged to be negligent is an employee. Rather, the element is satisfied if the hospital holds itself out as a provider of
emergency room care without informing the patient that the care is provided by independent contractors.
 The element of justifiable reliance on the part of the plaintiff is satisfied if the plaintiff relies upon the hospital to provide
complete emergency room care, rather than upon a specific physician.

The doctrine of apparent authority essentially involves two factors to determine the liability of an independent-contractor physician.

The first factor focuses on the hospital's manifestations and is sometimes described as an inquiry whether the hospital acted in a
manner which would lead a reasonable person to conclude that the individual who was alleged to be negligent was an employee or
agent of the hospital.47 In this regard, the hospital need not make express representations to the patient that the treating physician
is an employee of the hospital; rather a representation may be general and implied. 48

The doctrine of apparent authority is a species of the doctrine of estoppel. Article 1431 of the Civil Code provides that "[t]hrough
estoppel, an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as
against the person relying thereon." Estoppel rests on this rule: "Whenever a party has, by his own declaration, act, or omission,
intentionally and deliberately led another to believe a particular thing true, and to act upon such belief, he cannot, in any litigation
arising out of such declaration, act or omission, be permitted to falsify it." 49

In the instant case, CMC impliedly held out Dr. Estrada as a member of its medical staff. Through CMC's acts, CMC clothed Dr. Estrada
with apparent authority thereby leading the Spouses Nogales to believe that Dr. Estrada was an employee or agent of CMC. CMC
cannot now repudiate such authority.

First, CMC granted staff privileges to Dr. Estrada. CMC extended its medical staff and facilities to Dr. Estrada. Upon Dr. Estrada's request
for Corazon's admission, CMC, through its personnel, readily accommodated Corazon and updated Dr. Estrada of her condition.

Second, CMC made Rogelio sign consent forms printed on CMC letterhead. Prior to Corazon's admission and supposed hysterectomy,
CMC asked Rogelio to sign release forms, the contents of which reinforced Rogelio's belief that Dr. Estrada was a member of CMC's
medical staff.50 The Consent on Admission and Agreement explicitly provides:

KNOW ALL MEN BY THESE PRESENTS:

I, Rogelio Nogales, of legal age, a resident of 1974 M. H. Del Pilar St., Malate Mla., being the
father/mother/brother/sister/spouse/relative/ guardian/or person in custody of Ma. Corazon, and representing his/her
family, of my own volition and free will, do consent and submit said Ma. Corazon to Dr. Oscar Estrada (hereinafter referred
to as Physician) for cure, treatment, retreatment, or emergency measures, that the Physician, personally or by and through
the Capitol Medical Center and/or its staff, may use, adapt, or employ such means, forms or methods of cure, treatment,
retreatment, or emergency measures as he may see best and most expedient; that Ma. Corazon and I will comply with any
and all rules, regulations, directions, and instructions of the Physician, the Capitol Medical Center and/or its staff; and, that
I will not hold liable or responsible and hereby waive and forever discharge and hold free the Physician, the Capitol Medical
Center and/or its staff, from any and all claims of whatever kind of nature, arising from directly or indirectly, or by reason of
said cure, treatment, or retreatment, or emergency measures or intervention of said physician, the Capitol Medical Center
and/or its staff.

x x x x51 (Emphasis supplied)

While the Consent to Operation pertinently reads, thus:

I, ROGELIO NOGALES, x x x, of my own volition and free will, do consent and submit said CORAZON NOGALES to Hysterectomy,
by the Surgical Staff and Anesthesiologists of Capitol Medical Center and/or whatever succeeding operations, treatment, or
emergency measures as may be necessary and most expedient; and, that I will not hold liable or responsible and hereby
waive and forever discharge and hold free the Surgeon, his assistants, anesthesiologists, the Capitol Medical Center and/or
its staff, from any and all claims of whatever kind of nature, arising from directly or indirectly, or by reason of said operation
or operations, treatment, or emergency measures, or intervention of the Surgeon, his assistants, anesthesiologists, the
Capitol Medical Center and/or its staff.52 (Emphasis supplied)

Without any indication in these consent forms that Dr. Estrada was an independent contractor-physician, the Spouses Nogales could
not have known that Dr. Estrada was an independent contractor. Significantly, no one from CMC informed the Spouses Nogales that
Dr. Estrada was an independent contractor. On the contrary, Dr. Atencio, who was then a member of CMC Board of Directors, testified
that Dr. Estrada was part of CMC's surgical staff. 53
Third, Dr. Estrada's referral of Corazon's profuse vaginal bleeding to Dr. Espinola, who was then the Head of the Obstetrics and
Gynecology Department of CMC, gave the impression that Dr. Estrada as a member of CMC's medical staff was collaborating with
other CMC-employed specialists in treating Corazon.

The second factor focuses on the patient's reliance. It is sometimes characterized as an inquiry on whether the plaintiff acted in
reliance upon the conduct of the hospital or its agent, consistent with ordinary care and prudence.54

The records show that the Spouses Nogales relied upon a perceived employment relationship with CMC in accepting Dr. Estrada's
services. Rogelio testified that he and his wife specifically chose Dr. Estrada to handle Corazon's delivery not only because of their
friend's recommendation, but more importantly because of Dr. Estrada's "connection with a reputable hospital, the [CMC]." 55 In other
words, Dr. Estrada's relationship with CMC played a significant role in the Spouses Nogales' decision in accepting Dr. Estrada's services
as the obstetrician-gynecologist for Corazon's delivery. Moreover, as earlier stated, there is no showing that before and during
Corazon's confinement at CMC, the Spouses Nogales knew or should have known that Dr. Estrada was not an employee of CMC.

Further, the Spouses Nogales looked to CMC to provide the best medical care and support services for Corazon's delivery. The Court
notes that prior to Corazon's fourth pregnancy, she used to give birth inside a clinic. Considering Corazon's age then, the Spouses
Nogales decided to have their fourth child delivered at CMC, which Rogelio regarded one of the best hospitals at the time. 56 This is
precisely because the Spouses Nogales feared that Corazon might experience complications during her delivery which would be better
addressed and treated in a modern and big hospital such as CMC. Moreover, Rogelio's consent in Corazon's hysterectomy to be
performed by a different physician, namely Dr. Espinola, is a clear indication of Rogelio's confidence in CMC's surgical staff.

CMC's defense that all it did was "to extend to [Corazon] its facilities" is untenable. The Court cannot close its eyes to the reality that
hospitals, such as CMC, are in the business of treatment. In this regard, the Court agrees with the observation made by the Court of
Appeals of North Carolina in Diggs v. Novant Health, Inc.,57 to wit:

"The conception that the hospital does not undertake to treat the patient, does not undertake to act through its doctors and
nurses, but undertakes instead simply to procure them to act upon their own responsibility, no longer reflects the fact.
Present day hospitals, as their manner of operation plainly demonstrates, do far more than furnish facilities for treatment.
They regularly employ on a salary basis a large staff of physicians, nurses and internes [sic], as well as administrative and
manual workers, and they charge patients for medical care and treatment, collecting for such services, if necessary, by
legal action. Certainly, the person who avails himself of 'hospital facilities' expects that the hospital will attempt to cure
him, not that its nurses or other employees will act on their own responsibility." x x x (Emphasis supplied)

Likewise unconvincing is CMC's argument that petitioners are estopped from claiming damages based on the Consent on Admission
and Consent to Operation. Both release forms consist of two parts. The first part gave CMC permission to administer to Corazon any
form of recognized medical treatment which the CMC medical staff deemed advisable. The second part of the documents, which may
properly be described as the releasing part, releases CMC and its employees "from any and all claims" arising from or by reason of the
treatment and operation.

The documents do not expressly release CMC from liability for injury to Corazon due to negligence during her treatment or operation.
Neither do the consent forms expressly exempt CMC from liability for Corazon's death due to negligence during such treatment or
operation. Such release forms, being in the nature of contracts of adhesion, are construed strictly against hospitals. Besides, a blanket
release in favor of hospitals "from any and all claims," which includes claims due to bad faith or gross negligence, would be contrary
to public policy and thus void.

Even simple negligence is not subject to blanket release in favor of establishments like hospitals but may only mitigate liability
depending on the circumstances.58 When a person needing urgent medical attention rushes to a hospital, he cannot bargain on equal
footing with the hospital on the terms of admission and operation. Such a person is literally at the mercy of the hospital. There can be
no clearer example of a contract of adhesion than one arising from such a dire situation. Thus, the release forms of CMC cannot relieve
CMC from liability for the negligent medical treatment of Corazon.

On the Liability of the Other Respondents

Despite this Court's pronouncement in its 9 September 200259 Resolution that the filing of petitioners' Manifestation confined
petitioners' claim only against CMC, Dr. Espinola, Dr. Lacson, and Dr. Uy, who have filed their comments, the Court deems it proper to
resolve the individual liability of the remaining respondents to put an end finally to this more than two-decade old controversy.
a) Dr. Ely Villaflor

Petitioners blame Dr. Ely Villaflor for failing to diagnose the cause of Corazon's bleeding and to suggest the correct remedy to Dr.
Estrada.60 Petitioners assert that it was Dr. Villaflor's duty to correct the error of Nurse Dumlao in the administration of hemacel.

The Court is not persuaded. Dr. Villaflor admitted administering a lower dosage of magnesium sulfate. However, this was after
informing Dr. Estrada that Corazon was no longer in convulsion and that her blood pressure went down to a dangerous level. 61 At that
moment, Dr. Estrada instructed Dr. Villaflor to reduce the dosage of magnesium sulfate from 10 to 2.5 grams. Since petitioners did
not dispute Dr. Villaflor's allegation, Dr. Villaflor's defense remains uncontroverted. Dr. Villaflor's act of administering a lower dosage
of magnesium sulfate was not out of her own volition or was in contravention of Dr. Estrada's order.

b) Dr. Rosa Uy

Dr. Rosa Uy's alleged negligence consisted of her failure (1) to call the attention of Dr. Estrada on the incorrect dosage of magnesium
sulfate administered by Dr. Villaflor; (2) to take corrective measures; and (3) to correct Nurse Dumlao's wrong method of hemacel
administration.

The Court believes Dr. Uy's claim that as a second year resident physician then at CMC, she was merely authorized to take the clinical
history and physical examination of Corazon. 62 However, that routine internal examination did not ipso facto make Dr. Uy liable for
the errors committed by Dr. Estrada. Further, petitioners' imputation of negligence rests on their baseless assumption that Dr. Uy was
present at the delivery room. Nothing shows that Dr. Uy participated in delivering Corazon's baby. Further, it is unexpected from Dr.
Uy, a mere resident physician at that time, to call the attention of a more experienced specialist, if ever she was present at the delivery
room.

c) Dr. Joel Enriquez

Petitioners fault Dr. Joel Enriquez also for not calling the attention of Dr. Estrada, Dr. Villaflor, and Nurse Dumlao about their errors.63
Petitioners insist that Dr. Enriquez should have taken, or at least suggested, corrective measures to rectify such errors.

The Court is not convinced. Dr. Enriquez is an anesthesiologist whose field of expertise is definitely not obstetrics and gynecology. As
such, Dr. Enriquez was not expected to correct Dr. Estrada's errors. Besides, there was no evidence of Dr. Enriquez's knowledge of any
error committed by Dr. Estrada and his failure to act upon such observation.

d) Dr. Perpetua Lacson

Petitioners fault Dr. Perpetua Lacson for her purported delay in the delivery of blood Corazon needed. 64 Petitioners claim that Dr.
Lacson was remiss in her duty of supervising the blood bank staff.

As found by the trial court, there was no unreasonable delay in the delivery of blood from the time of the request until the transfusion
to Corazon. Dr. Lacson competently explained the procedure before blood could be given to the patient. 65 Taking into account the
bleeding time, clotting time and cross-matching, Dr. Lacson stated that it would take approximately 45-60 minutes before blood could
be ready for transfusion.66 Further, no evidence exists that Dr. Lacson neglected her duties as head of the blood bank.

e) Dr. Noe Espinola

Petitioners argue that Dr. Espinola should not have ordered immediate hysterectomy without determining the underlying cause of
Corazon's bleeding. Dr. Espinola should have first considered the possibility of cervical injury, and advised a thorough examination of
the cervix, instead of believing outright Dr. Estrada's diagnosis that the cause of bleeding was uterine atony.

Dr. Espinola's order to do hysterectomy which was based on the information he received by phone is not negligence. The Court agrees
with the trial court's observation that Dr. Espinola, upon hearing such information about Corazon's condition, believed in good faith
that hysterectomy was the correct remedy. At any rate, the hysterectomy did not push through because upon Dr. Espinola's arrival, it
was already too late. At the time, Corazon was practically dead.

f) Nurse J. Dumlao
In Moore v. Guthrie Hospital Inc.,67 the US Court of Appeals, Fourth Circuit, held that to recover, a patient complaining of injuries
allegedly resulting when the nurse negligently injected medicine to him intravenously instead of intramuscularly had to show that (1)
an intravenous injection constituted a lack of reasonable and ordinary care; (2) the nurse injected medicine intravenously; and (3)
such injection was the proximate cause of his injury.

In the present case, there is no evidence of Nurse Dumlao's alleged failure to follow Dr. Estrada's specific instructions. Even assuming
Nurse Dumlao defied Dr. Estrada's order, there is no showing that side-drip administration of hemacel proximately caused Corazon's
death. No evidence linking Corazon's death and the alleged wrongful hemacel administration was introduced. Therefore, there is no
basis to hold Nurse Dumlao liable for negligence.

On the Award of Interest on Damages

The award of interest on damages is proper and allowed under Article 2211 of the Civil Code, which states that in crimes and quasi-
delicts, interest as a part of the damages may, in a proper case, be adjudicated in the discretion of the court.68

WHEREFORE, the Court PARTLY GRANTS the petition. The Court finds respondent Capitol Medical Center vicariously liable for the
negligence of Dr. Oscar Estrada. The amounts of P105,000 as actual damages and P700,000 as moral damages should each earn legal
interest at the rate of six percent (6%) per annum computed from the date of the judgment of the trial court. The Court affirms the
rest of the Decision dated 6 February 1998 and Resolution dated 21 March 2000 of the Court of Appeals in CA-G.R. CV No. 45641.

SO ORDERED.

Quisumbing, J., Chairperson, Carpio Morales, Tinga, and Velasco, Jr., JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 126297 January 31, 2007

PROFESSIONAL SERVICES, INC., Petitioner,

vs.
NATIVIDAD and ENRIQUE AGANA, Respondents.

x-----------------------x

G.R. No. 126467 January 31, 2007

NATIVIDAD (Substituted by her children MARCELINO AGANA III, ENRIQUE AGANA, JR., EMMA AGANA ANDAYA, JESUS AGANA,
and RAYMUND AGANA) and ENRIQUE AGANA, Petitioners,
vs.
JUAN FUENTES, Respondent.

x- - - - - - - - - - - - - - - - - - - -- - - - x

G.R. No. 127590 January 31, 2007

MIGUEL AMPIL, Petitioner,

vs.
NATIVIDAD AGANA and ENRIQUE AGANA, Respondents.

DECISION

SANDOVAL-GUTIERREZ, J.:

Hospitals, having undertaken one of mankind’s most important and delicate endeavors, must assume the grave responsibility of
pursuing it with appropriate care. The care and service dispensed through this high trust, however technical, complex and esoteric its
character may be, must meet standards of responsibility commensurate with the undertaking to preserve and protect the health, and
indeed, the very lives of those placed in the hospital’s keeping. 1

Assailed in these three consolidated petitions for review on certiorari is the Court of Appeals’ Decision 2 dated September 6, 1996 in
CA-G.R. CV No. 42062 and CA-G.R. SP No. 32198 affirming with modification the Decision3 dated March 17, 1993 of the Regional Trial
Court (RTC), Branch 96, Quezon City in Civil Case No. Q-43322 and nullifying its Order dated September 21, 1993.

The facts, as culled from the records, are:

On April 4, 1984, Natividad Agana was rushed to the Medical City General Hospital (Medical City Hospital) because of difficulty of
bowel movement and bloody anal discharge. After a series of medical examinations, Dr. Miguel Ampil, petitioner in G.R. No. 127590,
diagnosed her to be suffering from "cancer of the sigmoid."

On April 11, 1984, Dr. Ampil, assisted by the medical staff4 of the Medical City Hospital, performed an anterior resection surgery on
Natividad. He found that the malignancy in her sigmoid area had spread on her left ovary, necessitating the removal of certain portions
of it. Thus, Dr. Ampil obtained the consent of Natividad’s husband, Enrique Agana, to permit Dr. Juan Fuentes, respondent in G.R. No.
126467, to perform hysterectomy on her.

After Dr. Fuentes had completed the hysterectomy, Dr. Ampil took over, completed the operation and closed the incision.
However, the operation appeared to be flawed. In the corresponding Record of Operation dated April 11, 1984, the attending nurses
entered these remarks:

"sponge count lacking 2

"announced to surgeon searched (sic) done but to no avail continue for closure."

On April 24, 1984, Natividad was released from the hospital. Her hospital and medical bills, including the doctors’ fees, amounted to
P60,000.00.

After a couple of days, Natividad complained of excruciating pain in her anal region. She consulted both Dr. Ampil and Dr. Fuentes
about it. They told her that the pain was the natural consequence of the surgery. Dr. Ampil then recommended that she consult an
oncologist to examine the cancerous nodes which were not removed during the operation.

On May 9, 1984, Natividad, accompanied by her husband, went to the United States to seek further treatment. After four months of
consultations and laboratory examinations, Natividad was told she was free of cancer. Hence, she was advised to return to the
Philippines.

On August 31, 1984, Natividad flew back to the Philippines, still suffering from pains. Two weeks thereafter, her daughter found a
piece of gauze protruding from her vagina. Upon being informed about it, Dr. Ampil proceeded to her house where he managed to
extract by hand a piece of gauze measuring 1.5 inches in width. He then assured her that the pains would soon vanish.

Dr. Ampil’s assurance did not come true. Instead, the pains intensified, prompting Natividad to seek treatment at the Polymedic
General Hospital. While confined there, Dr. Ramon Gutierrez detected the presence of another foreign object in her vagina -- a foul-
smelling gauze measuring 1.5 inches in width which badly infected her vaginal vault. A recto-vaginal fistula had formed in her
reproductive organs which forced stool to excrete through the vagina. Another surgical operation was needed to remedy the damage.
Thus, in October 1984, Natividad underwent another surgery.

On November 12, 1984, Natividad and her husband filed with the RTC, Branch 96, Quezon City a complaint for damages against the
Professional Services, Inc. (PSI), owner of the Medical City Hospital, Dr. Ampil, and Dr. Fuentes, docketed as Civil Case No. Q-43322.
They alleged that the latter are liable for negligence for leaving two pieces of gauze inside Natividad’s body and malpractice for
concealing their acts of negligence.

Meanwhile, Enrique Agana also filed with the Professional Regulation Commission (PRC) an administrative complaint for gross
negligence and malpractice against Dr. Ampil and Dr. Fuentes, docketed as Administrative Case No. 1690. The PRC Board of Medicine
heard the case only with respect to Dr. Fuentes because it failed to acquire jurisdiction over Dr. Ampil who was then in the United
States.

On February 16, 1986, pending the outcome of the above cases, Natividad died and was duly substituted by her above-named children
(the Aganas).

On March 17, 1993, the RTC rendered its Decision in favor of the Aganas, finding PSI, Dr. Ampil and Dr. Fuentes liable for negligence
and malpractice, the decretal part of which reads:

WHEREFORE, judgment is hereby rendered for the plaintiffs ordering the defendants PROFESSIONAL SERVICES, INC., DR. MIGUEL
AMPIL and DR. JUAN FUENTES to pay to the plaintiffs, jointly and severally, except in respect of the award for exemplary damages and
the interest thereon which are the liabilities of defendants Dr. Ampil and Dr. Fuentes only, as follows:

1. As actual damages, the following amounts:

a. The equivalent in Philippine Currency of the total of US$19,900.00 at the rate of P21.60-US$1.00, as
reimbursement of actual expenses incurred in the United States of America;

b. The sum of P4,800.00 as travel taxes of plaintiffs and their physician daughter;
 c. The total sum of P45,802.50, representing the cost of hospitalization at Polymedic Hospital, medical fees, and cost
of the saline solution;

2. As moral damages, the sum of P2,000,000.00;

3. As exemplary damages, the sum of P300,000.00;

4. As attorney’s fees, the sum of P250,000.00;

5. Legal interest on items 1 (a), (b), and (c); 2; and 3 hereinabove, from date of filing of the complaint until full payment; and

6. Costs of suit.

SO ORDERED.

Aggrieved, PSI, Dr. Fuentes and Dr. Ampil interposed an appeal to the Court of Appeals, docketed as CA-G.R. CV No. 42062.

Incidentally, on April 3, 1993, the Aganas filed with the RTC a motion for a partial execution of its Decision, which was granted in an
Order dated May 11, 1993. Thereafter, the sheriff levied upon certain properties of Dr. Ampil and sold them for P451,275.00 and
delivered the amount to the Aganas.

Following their receipt of the money, the Aganas entered into an agreement with PSI and Dr. Fuentes to indefinitely suspend any
further execution of the RTC Decision. However, not long thereafter, the Aganas again filed a motion for an alias writ of execution
against the properties of PSI and Dr. Fuentes. On September 21, 1993, the RTC granted the motion and issued the corresponding writ,
prompting Dr. Fuentes to file with the Court of Appeals a petition for certiorari and prohibition, with prayer for preliminary injunction,
docketed as CA-G.R. SP No. 32198. During its pendency, the Court of Appeals issued a Resolution 5 dated October 29, 1993 granting
Dr. Fuentes’ prayer for injunctive relief.

On January 24, 1994, CA-G.R. SP No. 32198 was consolidated with CA-G.R. CV No. 42062.

Meanwhile, on January 23, 1995, the PRC Board of Medicine rendered its Decision 6 in Administrative Case No. 1690 dismissing the
case against Dr. Fuentes. The Board held that the prosecution failed to show that Dr. Fuentes was the one who left the two pieces of
gauze inside Natividad’s body; and that he concealed such fact from Natividad.

On September 6, 1996, the Court of Appeals rendered its Decision jointly disposing of CA-G.R. CV No. 42062 and CA-G.R. SP No. 32198,
thus:

WHEREFORE, except for the modification that the case against defendant-appellant Dr. Juan Fuentes is hereby DISMISSED, and with
the pronouncement that defendant-appellant Dr. Miguel Ampil is liable to reimburse defendant-appellant Professional Services, Inc.,
whatever amount the latter will pay or had paid to the plaintiffs-appellees, the decision appealed from is hereby AFFIRMED and the
instant appeal DISMISSED.

Concomitant with the above, the petition for certiorari and prohibition filed by herein defendant-appellant Dr. Juan Fuentes in CA-
G.R. SP No. 32198 is hereby GRANTED and the challenged order of the respondent judge dated September 21, 1993, as well as the
alias writ of execution issued pursuant thereto are hereby NULLIFIED and SET ASIDE. The bond posted by the petitioner in connection
with the writ of preliminary injunction issued by this Court on November 29, 1993 is hereby cancelled.

Costs against defendants-appellants Dr. Miguel Ampil and Professional Services, Inc.

SO ORDERED.

Only Dr. Ampil filed a motion for reconsideration, but it was denied in a Resolution 7 dated December 19, 1996.

Hence, the instant consolidated petitions.

In G.R. No. 126297, PSI alleged in its petition that the Court of Appeals erred in holding that: (1) it is estopped from raising the defense
that Dr. Ampil is not its employee; (2) it is solidarily liable with Dr. Ampil; and (3) it is not entitled to its counterclaim against the Aganas.
PSI contends that Dr. Ampil is not its employee, but a mere consultant or independent contractor. As such, he alone should answer
for his negligence.

In G.R. No. 126467, the Aganas maintain that the Court of Appeals erred in finding that Dr. Fuentes is not guilty of negligence or
medical malpractice, invoking the doctrine of res ipsa loquitur. They contend that the pieces of gauze are prima facie proofs that the
operating surgeons have been negligent.

Finally, in G.R. No. 127590, Dr. Ampil asserts that the Court of Appeals erred in finding him liable for negligence and malpractice sans
evidence that he left the two pieces of gauze in Natividad’s vagina. He pointed to other probable causes, such as: (1) it was Dr. Fuentes
who used gauzes in performing the hysterectomy; (2) the attending nurses’ failure to properly count the gauzes used during surgery;
and (3) the medical intervention of the American doctors who examined Natividad in the United States of America.

For our resolution are these three vital issues: first, whether the Court of Appeals erred in holding Dr. Ampil liable for negligence and
malpractice; second, whether the Court of Appeals erred in absolving Dr. Fuentes of any liability; and third, whether PSI may be held
solidarily liable for the negligence of Dr. Ampil.

I - G.R. No. 127590

Whether the Court of Appeals Erred in Holding Dr. Ampil

Liable for Negligence and Malpractice.

Dr. Ampil, in an attempt to absolve himself, gears the Court’s attention to other possible causes of Natividad’s detriment. He argues
that the Court should not discount either of the following possibilities: first, Dr. Fuentes left the gauzes in Natividad’s body after
performing hysterectomy; second, the attending nurses erred in counting the gauzes; and third, the American doctors were the ones
who placed the gauzes in Natividad’s body.

Dr. Ampil’s arguments are purely conjectural and without basis. Records show that he did not present any evidence to prove that the
American doctors were the ones who put or left the gauzes in Natividad’s body. Neither did he submit evidence to rebut the
correctness of the record of operation, particularly the number of gauzes used. As to the alleged negligence of Dr. Fuentes, we are
mindful that Dr. Ampil examined his (Dr. Fuentes’) work and found it in order.

The glaring truth is that all the major circumstances, taken together, as specified by the Court of Appeals, directly point to Dr. Ampil
as the negligent party, thus:

First, it is not disputed that the surgeons used gauzes as sponges to control the bleeding of the patient during the surgical
operation.

Second, immediately after the operation, the nurses who assisted in the surgery noted in their report that the ‘sponge count
(was) lacking 2’; that such anomaly was ‘announced to surgeon’ and that a ‘search was done but to no avail’ prompting Dr.
Ampil to ‘continue for closure’ x x x.

Third, after the operation, two (2) gauzes were extracted from the same spot of the body of Mrs. Agana where the surgery
was performed.

An operation requiring the placing of sponges in the incision is not complete until the sponges are properly removed, and it is settled
that the leaving of sponges or other foreign substances in the wound after the incision has been closed is at least prima facie negligence
by the operating surgeon.8 To put it simply, such act is considered so inconsistent with due care as to raise an inference of negligence.
There are even legions of authorities to the effect that such act is negligence per se. 9

Of course, the Court is not blind to the reality that there are times when danger to a patient’s life precludes a surgeon from further
searching missing sponges or foreign objects left in the body. But this does not leave him free from any obligation. Even if it has been
shown that a surgeon was required by the urgent necessities of the case to leave a sponge in his patient’s abdomen, because of the
dangers attendant upon delay, still, it is his legal duty to so inform his patient within a reasonable time thereafter by advising her of
what he had been compelled to do. This is in order that she might seek relief from the effects of the foreign object left in her body as
her condition might permit. The ruling in Smith v. Zeagler10 is explicit, thus:

The removal of all sponges used is part of a surgical operation, and when a physician or surgeon fails to remove a sponge he has placed
in his patient’s body that should be removed as part of the operation, he thereby leaves his operation uncompleted and creates a new
condition which imposes upon him the legal duty of calling the new condition to his patient’s attention, and endeavoring with the
means he has at hand to minimize and avoid untoward results likely to ensue therefrom.

Here, Dr. Ampil did not inform Natividad about the missing two pieces of gauze. Worse, he even misled her that the pain she was
experiencing was the ordinary consequence of her operation. Had he been more candid, Natividad could have taken the immediate
and appropriate medical remedy to remove the gauzes from her body. To our mind, what was initially an act of negligence by Dr.
Ampil has ripened into a deliberate wrongful act of deceiving his patient.

This is a clear case of medical malpractice or more appropriately, medical negligence. To successfully pursue this kind of case, a patient
must only prove that a health care provider either failed to do something which a reasonably prudent health care provider would have
done, or that he did something that a reasonably prudent provider would not have done; and that failure or action caused injury to
the patient.11 Simply put, the elements are duty, breach, injury and proximate causation. Dr, Ampil, as the lead surgeon, had the duty
to remove all foreign objects, such as gauzes, from Natividad’s body before closure of the incision. When he failed to do so, it was his
duty to inform Natividad about it. Dr. Ampil breached both duties. Such breach caused injury to Natividad, necessitating her further
examination by American doctors and another surgery. That Dr. Ampil’s negligence is the proximate cause12 of Natividad’s injury could
be traced from his act of closing the incision despite the information given by the attending nurses that two pieces of gauze were still
missing. That they were later on extracted from Natividad’s vagina established the causal link between Dr. Ampil’s negligence and the
injury. And what further aggravated such injury was his deliberate concealment of the missing gauzes from the knowledge of Natividad
and her family.

II - G.R. No. 126467

Whether the Court of Appeals Erred in Absolving Dr. Fuentes of any Liability

The Aganas assailed the dismissal by the trial court of the case against Dr. Fuentes on the ground that it is contrary to the doctrine of
res ipsa loquitur. According to them, the fact that the two pieces of gauze were left inside Natividad’s body is a prima facie evidence
of Dr. Fuentes’ negligence.

We are not convinced.

Literally, res ipsa loquitur means "the thing speaks for itself." It is the rule that the fact of the occurrence of an injury, taken with the
surrounding circumstances, may permit an inference or raise a presumption of negligence, or make out a plaintiff’s prima facie case,
and present a question of fact for defendant to meet with an explanation. 13 Stated differently, where the thing which caused the
injury, without the fault of the injured, is under the exclusive control of the defendant and the injury is such that it should not have
occurred if he, having such control used proper care, it affords reasonable evidence, in the absence of explanation that the injury
arose from the defendant’s want of care, and the burden of proof is shifted to him to establish that he has observed due care and
diligence.14

From the foregoing statements of the rule, the requisites for the applicability of the doctrine of res ipsa loquitur are: (1) the occurrence
of an injury; (2) the thing which caused the injury was under the control and management of the defendant; (3) the occurrence was
such that in the ordinary course of things, would not have happened if those who had control or management used proper care; and
(4) the absence of explanation by the defendant. Of the foregoing requisites, the most instrumental is the "control and management
of the thing which caused the injury."15

We find the element of "control and management of the thing which caused the injury" to be wanting. Hence, the doctrine of res ipsa
loquitur will not lie.

It was duly established that Dr. Ampil was the lead surgeon during the operation of Natividad. He requested the assistance of Dr.
Fuentes only to perform hysterectomy when he (Dr. Ampil) found that the malignancy in her sigmoid area had spread to her left ovary.
Dr. Fuentes performed the surgery and thereafter reported and showed his work to Dr. Ampil. The latter examined it and finding
everything to be in order, allowed Dr. Fuentes to leave the operating room. Dr. Ampil then resumed operating on Natividad. He was
about to finish the procedure when the attending nurses informed him that two pieces of gauze were missing. A "diligent search" was
conducted, but the misplaced gauzes were not found. Dr. Ampil then directed that the incision be closed. During this entire period,
Dr. Fuentes was no longer in the operating room and had, in fact, left the hospital.

Under the "Captain of the Ship" rule, the operating surgeon is the person in complete charge of the surgery room and all personnel
connected with the operation. Their duty is to obey his orders. 16 As stated before, Dr. Ampil was the lead surgeon. In other words, he
was the "Captain of the Ship." That he discharged such role is evident from his following conduct: (1) calling Dr. Fuentes to perform a
hysterectomy; (2) examining the work of Dr. Fuentes and finding it in order; (3) granting Dr. Fuentes’ permission to leave; and (4)
ordering the closure of the incision. To our mind, it was this act of ordering the closure of the incision notwithstanding that two pieces
of gauze remained unaccounted for, that caused injury to Natividad’s body. Clearly, the control and management of the thing which
caused the injury was in the hands of Dr. Ampil, not Dr. Fuentes.

In this jurisdiction, res ipsa loquitur is not a rule of substantive law, hence, does not per se create or constitute an independent or
separate ground of liability, being a mere evidentiary rule. 17 In other words, mere invocation and application of the doctrine does not
dispense with the requirement of proof of negligence. Here, the negligence was proven to have been committed by Dr. Ampil and not
by Dr. Fuentes.

III - G.R. No. 126297

Whether PSI Is Liable for the Negligence of Dr. Ampil

The third issue necessitates a glimpse at the historical development of hospitals and the resulting theories concerning their liability
for the negligence of physicians.

Until the mid-nineteenth century, hospitals were generally charitable institutions, providing medical services to the lowest classes of
society, without regard for a patient’s ability to pay. 18 Those who could afford medical treatment were usually treated at home by
their doctors.19 However, the days of house calls and philanthropic health care are over. The modern health care industry continues
to distance itself from its charitable past and has experienced a significant conversion from a not-for-profit health care to for-profit
hospital businesses. Consequently, significant changes in health law have accompanied the business-related changes in the hospital
industry. One important legal change is an increase in hospital liability for medical malpractice. Many courts now allow claims for
hospital vicarious liability under the theories of respondeat superior, apparent authority, ostensible authority, or agency by estoppel.
20

In this jurisdiction, the statute governing liability for negligent acts is Article 2176 of the Civil Code, which reads:

Art. 2176. Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage
done. Such fault or negligence, if there is no pre-existing contractual relation between the parties, is called a quasi-delict and is
governed by the provisions of this Chapter.

A derivative of this provision is Article 2180, the rule governing vicarious liability under the doctrine of respondeat superior, thus:

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.

x x x x x x

The owners and managers of an establishment or enterprise are likewise responsible for damages caused by their employees in the
service of the branches in which the latter are employed or on the occasion of their functions.

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 in any business or industry.

x x x x x x

The responsibility treated of in this article shall cease when the persons herein mentioned prove that they observed all the diligence
of a good father of a family to prevent damage.
A prominent civilist commented that professionals engaged by an employer, such as physicians, dentists, and pharmacists, are not
"employees" under this article because the manner in which they perform their work is not within the control of the latter (employer).
In other words, professionals are considered personally liable for the fault or negligence they commit in the discharge of their duties,
and their employer cannot be held liable for such fault or negligence. In the context of the present case, "a hospital cannot be held
liable for the fault or negligence of a physician or surgeon in the treatment or operation of patients." 21

The foregoing view is grounded on the traditional notion that the professional status and the very nature of the physician’s calling
preclude him from being classed as an agent or employee of a hospital, whenever he acts in a professional capacity. 22 It has been said
that medical practice strictly involves highly developed and specialized knowledge, 23 such that physicians are generally free to exercise
their own skill and judgment in rendering medical services sans interference. 24 Hence, when a doctor practices medicine in a hospital
setting, the hospital and its employees are deemed to subserve him in his ministrations to the patient and his actions are of his own
responsibility.25

The case of Schloendorff v. Society of New York Hospital26 was then considered an authority for this view. The "Schloendorff doctrine"
regards a physician, even if employed by a hospital, as an independent contractor because of the skill he exercises and the lack of
control exerted over his work. Under this doctrine, hospitals are exempt from the application of the respondeat superior principle for
fault or negligence committed by physicians in the discharge of their profession.

However, the efficacy of the foregoing doctrine has weakened with the significant developments in medical care. Courts came to
realize that modern hospitals are increasingly taking active role in supplying and regulating medical care to patients. No longer were
a hospital’s functions limited to furnishing room, food, facilities for treatment and operation, and attendants for its patients. Thus, in
Bing v. Thunig,27 the New York Court of Appeals deviated from the Schloendorff doctrine, noting that modern hospitals actually do far
more than provide facilities for treatment. Rather, they regularly employ, on a salaried basis, a large staff of physicians, interns, nurses,
administrative and manual workers. They charge patients for medical care and treatment, even collecting for such services through
legal action, if necessary. The court then concluded that there is no reason to exempt hospitals from the universal rule of respondeat
superior.

In our shores, the nature of the relationship between the hospital and the physicians is rendered inconsequential in view of our
categorical pronouncement in Ramos v. Court of Appeals28 that for purposes of apportioning responsibility in medical negligence cases,
an employer-employee relationship in effect exists between hospitals and their attending and visiting physicians. This Court held:

"We now discuss the responsibility of the hospital in this particular incident. The unique practice (among private hospitals) of filling
up specialist staff with attending and visiting "consultants," who are allegedly not hospital employees, presents problems in
apportioning responsibility for negligence in medical malpractice cases. However, the difficulty is more apparent than real.

In the first place, hospitals exercise significant control in the hiring and firing of consultants and in the conduct of their work within
the hospital premises. Doctors who apply for ‘consultant’ slots, visiting or attending, are required to submit proof of completion of
residency, their educational qualifications, generally, evidence of accreditation by the appropriate board (diplomate), evidence of
fellowship in most cases, and references. These requirements are carefully scrutinized by members of the hospital administration or
by a review committee set up by the hospital who either accept or reject the application. x x x.

After a physician is accepted, either as a visiting or attending consultant, he is normally required to attend clinico-pathological
conferences, conduct bedside rounds for clerks, interns and residents, moderate grand rounds and patient audits and perform other
tasks and responsibilities, for the privilege of being able to maintain a clinic in the hospital, and/or for the privilege of admitting
patients into the hospital. In addition to these, the physician’s performance as a specialist is generally evaluated by a peer review
committee on the basis of mortality and morbidity statistics, and feedback from patients, nurses, interns and residents. A consultant
remiss in his duties, or a consultant who regularly falls short of the minimum standards acceptable to the hospital or its peer review
committee, is normally politely terminated.

In other words, private hospitals, hire, fire and exercise real control over their attending and visiting ‘consultant’ staff. While
‘consultants’ are not, technically employees, x x x, the control exercised, the hiring, and the right to terminate consultants all fulfill the
important hallmarks of an employer-employee relationship, with the exception of the payment of wages. In assessing whether such a
relationship in fact exists, the control test is determining. Accordingly, on the basis of the foregoing, we rule that for the purpose of
allocating responsibility in medical negligence cases, an employer-employee relationship in effect exists between hospitals and their
attending and visiting physicians. "
But the Ramos pronouncement is not our only basis in sustaining PSI’s liability. Its liability is also anchored upon the agency principle
of apparent authority or agency by estoppel and the doctrine of corporate negligence which have gained acceptance in the
determination of a hospital’s liability for negligent acts of health professionals. The present case serves as a perfect platform to test
the applicability of these doctrines, thus, enriching our jurisprudence.

Apparent authority, or what is sometimes referred to as the "holding

out" theory, or doctrine of ostensible agency or agency by estoppel,29 has its origin from the law of agency. It imposes liability, not as
the result of the reality of a contractual relationship, but rather because of the actions of a principal or an employer in somehow
misleading the public into believing that the relationship or the authority exists. 30 The concept is essentially one of estoppel and has
been explained in this manner:

"The principal is bound by the acts of his agent with the apparent authority which he knowingly permits the agent to assume, or which
he holds the agent out to the public as possessing. The question in every case is whether the principal has by his voluntary act placed
the agent in such a situation that a person of ordinary prudence, conversant with business usages and the nature of the particular
business, is justified in presuming that such agent has authority to perform the particular act in question. 31

The applicability of apparent authority in the field of hospital liability was upheld long time ago in Irving v. Doctor Hospital of Lake
Worth, Inc.32 There, it was explicitly stated that "there does not appear to be any rational basis for excluding the concept of apparent
authority from the field of hospital liability." Thus, in cases where it can be shown that a hospital, by its actions, has held out a particular
physician as its agent and/or employee and that a patient has accepted treatment from that physician in the reasonable belief that it
is being rendered in behalf of the hospital, then the hospital will be liable for the physician’s negligence.

Our jurisdiction recognizes the concept of an agency by implication or estoppel. Article 1869 of the Civil Code reads:

ART. 1869. Agency may be express, or implied from the acts of the principal, from his silence or lack of action, or his failure to repudiate
the agency, knowing that another person is acting on his behalf without authority.

In this case, PSI publicly displays in the lobby of the Medical City Hospital the names and specializations of the physicians associated
or accredited by it, including those of Dr. Ampil and Dr. Fuentes. We concur with the Court of Appeals’ conclusion that it "is now
estopped from passing all the blame to the physicians whose names it proudly paraded in the public directory leading the public to
believe that it vouched for their skill and competence." Indeed, PSI’s act is tantamount to holding out to the public that Medical City
Hospital, through its accredited physicians, offers quality health care services. By accrediting Dr. Ampil and Dr. Fuentes and publicly
advertising their qualifications, the hospital created the impression that they were its agents, authorized to perform medical or surgical
services for its patients. As expected, these patients, Natividad being one of them, accepted the services on the reasonable belief that
such were being rendered by the hospital or its employees, agents, or servants. The trial court correctly pointed out:

x x x regardless of the education and status in life of the patient, he ought not be burdened with the defense of absence of employer-
employee relationship between the hospital and the independent physician whose name and competence are certainly certified to
the general public by the hospital’s act of listing him and his specialty in its lobby directory, as in the case herein. The high costs of
today’s medical and health care should at least exact on the hospital greater, if not broader, legal responsibility for the conduct of
treatment and surgery within its facility by its accredited physician or surgeon, regardless of whether he is independent or
employed."33

The wisdom of the foregoing ratiocination is easy to discern. Corporate entities, like PSI, are capable of acting only through other
individuals, such as physicians. If these accredited physicians do their job well, the hospital succeeds in its mission of offering quality
medical services and thus profits financially. Logically, where negligence mars the quality of its services, the hospital should not be
allowed to escape liability for the acts of its ostensible agents.

We now proceed to the doctrine of corporate negligence or corporate responsibility.

One allegation in the complaint in Civil Case No. Q-43332 for negligence and malpractice is that PSI as owner, operator and manager
of Medical City Hospital, "did not perform the necessary supervision nor exercise diligent efforts in the supervision of Drs. Ampil and
Fuentes and its nursing staff, resident doctors, and medical interns who assisted Drs. Ampil and Fuentes in the performance of their
duties as surgeons."34 Premised on the doctrine of corporate negligence, the trial court held that PSI is directly liable for such breach
of duty.
We agree with the trial court.

Recent years have seen the doctrine of corporate negligence as the judicial answer to the problem of allocating hospital’s liability for
the negligent acts of health practitioners, absent facts to support the application of respondeat superior or apparent authority. Its
formulation proceeds from the judiciary’s acknowledgment that in these modern times, the duty of providing quality medical service
is no longer the sole prerogative and responsibility of the physician. The modern hospitals have changed structure. Hospitals now tend
to organize a highly professional medical staff whose competence and performance need to be monitored by the hospitals
commensurate with their inherent responsibility to provide quality medical care. 35

The doctrine has its genesis in Darling v. Charleston Community Hospital. 36 There, the Supreme Court of Illinois held that "the jury
could have found a hospital negligent, inter alia, in failing to have a sufficient number of trained nurses attending the patient; failing
to require a consultation with or examination by members of the hospital staff; and failing to review the treatment rendered to the
patient." On the basis of Darling, other jurisdictions held that a hospital’s corporate negligence extends to permitting a physician
known to be incompetent to practice at the hospital.37 With the passage of time, more duties were expected from hospitals, among
them: (1) the use of reasonable care in the maintenance of safe and adequate facilities and equipment; (2) the selection and retention
of competent physicians; (3) the overseeing or supervision of all persons who practice medicine within its walls; and (4) the
formulation, adoption and enforcement of adequate rules and policies that ensure quality care for its patients.38 Thus, in Tucson
Medical Center, Inc. v. Misevich,39 it was held that a hospital, following the doctrine of corporate responsibility, has the duty to see
that it meets the standards of responsibilities for the care of patients. Such duty includes the proper supervision of the members of
its medical staff. And in Bost v. Riley,40 the court concluded that a patient who enters a hospital does so with the reasonable
expectation that it will attempt to cure him. The hospital accordingly has the duty to make a reasonable effort to monitor and oversee
the treatment prescribed and administered by the physicians practicing in its premises.

In the present case, it was duly established that PSI operates the Medical City Hospital for the purpose and under the concept of
providing comprehensive medical services to the public. Accordingly, it has the duty to exercise reasonable care to protect from harm
all patients admitted into its facility for medical treatment. Unfortunately, PSI failed to perform such duty. The findings of the trial
court are convincing, thus:

x x x PSI’s liability is traceable to its failure to conduct an investigation of the matter reported in the nota bene of the count nurse.
Such failure established PSI’s part in the dark conspiracy of silence and concealment about the gauzes. Ethical considerations, if not
also legal, dictated the holding of an immediate inquiry into the events, if not for the benefit of the patient to whom the duty is
primarily owed, then in the interest of arriving at the truth. The Court cannot accept that the medical and the healing professions,
through their members like defendant surgeons, and their institutions like PSI’s hospital facility, can callously turn their backs on and
disregard even a mere probability of mistake or negligence by refusing or failing to investigate a report of such seriousness as the one
in Natividad’s case.

It is worthy to note that Dr. Ampil and Dr. Fuentes operated on Natividad with the assistance of the Medical City Hospital’s staff,
composed of resident doctors, nurses, and interns. As such, it is reasonable to conclude that PSI, as the operator of the hospital, has
actual or constructive knowledge of the procedures carried out, particularly the report of the attending nurses that the two pieces of
gauze were missing. In Fridena v. Evans,41 it was held that a corporation is bound by the knowledge acquired by or notice given to its
agents or officers within the scope of their authority and in reference to a matter to which their authority extends. This means that
the knowledge of any of the staff of Medical City Hospital constitutes knowledge of PSI. Now, the failure of PSI, despite the attending
nurses’ report, to investigate and inform Natividad regarding the missing gauzes amounts to callous negligence. Not only did PSI breach
its duties to oversee or supervise all persons who practice medicine within its walls, it also failed to take an active step in fixing the
negligence committed. This renders PSI, not only vicariously liable for the negligence of Dr. Ampil under Article 2180 of the Civil Code,
but also directly liable for its own negligence under Article 2176. In Fridena, the Supreme Court of Arizona held:

x x x In recent years, however, the duty of care owed to the patient by the hospital has expanded. The emerging trend is to hold the
hospital responsible where the hospital has failed to monitor and review medical services being provided within its walls. See Kahn
Hospital Malpractice Prevention, 27 De Paul . Rev. 23 (1977).

Among the cases indicative of the ‘emerging trend’ is Purcell v. Zimbelman, 18 Ariz. App. 75,500 P. 2d 335 (1972). In Purcell, the
hospital argued that it could not be held liable for the malpractice of a medical practitioner because he was an independent contractor
within the hospital. The Court of Appeals pointed out that the hospital had created a professional staff whose competence and
performance was to be monitored and reviewed by the governing body of the hospital, and the court held that a hospital would be
negligent where it had knowledge or reason to believe that a doctor using the facilities was employing a method of treatment or care
which fell below the recognized standard of care.
Subsequent to the Purcell decision, the Arizona Court of Appeals held that a hospital has certain inherent responsibilities regarding
the quality of medical care furnished to patients within its walls and it must meet the standards of responsibility commensurate with
this undertaking. Beeck v. Tucson General Hospital, 18 Ariz. App. 165, 500 P. 2d 1153 (1972). This court has confirmed the rulings of
the Court of Appeals that a hospital has the duty of supervising the competence of the doctors on its staff. x x x.

x x x x x x

In the amended complaint, the plaintiffs did plead that the operation was performed at the hospital with its knowledge, aid, and
assistance, and that the negligence of the defendants was the proximate cause of the patient’s injuries. We find that such general
allegations of negligence, along with the evidence produced at the trial of this case, are sufficient to support the hospital’s liability
based on the theory of negligent supervision."

Anent the corollary issue of whether PSI is solidarily liable with Dr. Ampil for damages, let it be emphasized that PSI, apart from a
general denial of its responsibility, failed to adduce evidence showing that it exercised the diligence of a good father of a family in the
accreditation and supervision of the latter. In neglecting to offer such proof, PSI failed to discharge its burden under the last paragraph
of Article 2180 cited earlier, and, therefore, must be adjudged solidarily liable with Dr. Ampil. Moreover, as we have discussed, PSI is
also directly liable to the Aganas.

One final word. Once a physician undertakes the treatment and care of a patient, the law imposes on him certain obligations. In order
to escape liability, he must possess that reasonable degree of learning, skill and experience required by his profession. At the same
time, he must apply reasonable care and diligence in the exercise of his skill and the application of his knowledge, and exert his best
judgment.

WHEREFORE, we DENY all the petitions and AFFIRM the challenged Decision of the Court of Appeals in CA-G.R. CV No. 42062 and CA-
G.R. SP No. 32198.

Costs against petitioners PSI and Dr. Miguel Ampil.

SO ORDERED.

ANGELINA SANDOVAL-GUTIERREZ
Associate Justice
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 126297 February 2, 2010

PROFESSIONAL SERVICES, INC., Petitioner,

vs.
THE COURT OF APPEALS and NATIVIDAD and ENRIQUE AGANA, Respondents.

x - - - - - - - - - - - - - - - - - - - - - - -x

G.R. No. 126467

NATIVIDAD [substituted by her children Marcelino Agana III, Enrique Agana, Jr., Emma Agana-Andaya, Jesus Agana and Raymund
Agana] and ENRIQUE AGANA, Petitioners,
vs.
THE COURT OF APPEALS and JUAN FUENTES, Respondents.

x - - - - - - - - - - - - - - - - - - - - - - -x

G.R. No. 127590

MIGUEL AMPIL, Petitioner,

vs.
NATIVIDAD and ENRIQUE AGANA, Respondents.

RESOLUTION

CORONA, J.:

With prior leave of court,1 petitioner Professional Services, Inc. (PSI) filed a second motion for reconsideration 2 urging referral thereof
to the Court en banc and seeking modification of the decision dated January 31, 2007 and resolution dated February 11, 2008 which
affirmed its vicarious and direct liability for damages to respondents Enrique Agana and the heirs of Natividad Agana (Aganas).

Manila Medical Services, Inc. (MMSI),3 Asian Hospital, Inc. (AHI),4 and Private Hospital Association of the Philippines (PHAP)5 all sought
to intervene in these cases invoking the common ground that, unless modified, the assailed decision and resolution will jeopardize the
financial viability of private hospitals and jack up the cost of health care.

The Special First Division of the Court granted the motions for intervention of MMSI, AHI and PHAP (hereafter intervenors),6 and
referred en consulta to the Court en banc the motion for prior leave of court and the second motion for reconsideration of PSI. 7

Due to paramount public interest, the Court en banc accepted the referral8 and heard the parties on oral arguments on one particular
issue: whether a hospital may be held liable for the negligence of physicians-consultants allowed to practice in its premises. 9

To recall the salient facts, PSI, together with Dr. Miguel Ampil (Dr. Ampil) and Dr. Juan Fuentes (Dr. Fuentes), was impleaded by Enrique
Agana and Natividad Agana (later substituted by her heirs), in a complaint 10 for damages filed in the Regional Trial Court (RTC) of
Quezon City, Branch 96, for the injuries suffered by Natividad when Dr. Ampil and Dr. Fuentes neglected to remove from her body two
gauzes11 which were used in the surgery they performed on her on April 11, 1984 at the Medical City General Hospital. PSI was
impleaded as owner, operator and manager of the hospital.

In a decision12 dated March 17, 1993, the RTC held PSI solidarily liable with Dr. Ampil and Dr. Fuentes for damages. 13 On appeal, the
Court of Appeals (CA), absolved Dr. Fuentes but affirmed the liability of Dr. Ampil and PSI, subject to the right of PSI to claim
reimbursement from Dr. Ampil.141avvphi1
On petition for review, this Court, in its January 31, 2007 decision, affirmed the CA decision. 15 PSI filed a motion for reconsideration16
but the Court denied it in a resolution dated February 11, 2008.17

The Court premised the direct liability of PSI to the Aganas on the following facts and law:

First, there existed between PSI and Dr. Ampil an employer-employee relationship as contemplated in the December 29, 1999 decision
in Ramos v. Court of Appeals18 that "for purposes of allocating responsibility in medical negligence cases, an employer-employee
relationship exists between hospitals and their consultants." 19 Although the Court in Ramos later issued a Resolution dated April 11,
200220 reversing its earlier finding on the existence of an employment relationship between hospital and doctor, a similar reversal was
not warranted in the present case because the defense raised by PSI consisted of a mere general denial of control or responsibility
over the actions of Dr. Ampil.21

Second, by accrediting Dr. Ampil and advertising his qualifications, PSI created the public impression that he was its agent. 22 Enrique
testified that it was on account of Dr. Ampil's accreditation with PSI that he conferred with said doctor about his wife's (Natividad's)
condition.23 After his meeting with Dr. Ampil, Enrique asked Natividad to personally consult Dr. Ampil. 24 In effect, when Enrigue and
Natividad engaged the services of Dr. Ampil, at the back of their minds was that the latter was a staff member of a prestigious hospital.
Thus, under the doctrine of apparent authority applied in Nogales, et al. v. Capitol Medical Center, et al.,25 PSI was liable for the
negligence of Dr. Ampil.

Finally, as owner and operator of Medical City General Hospital, PSI was bound by its duty to provide comprehensive medical services
to Natividad Agana, to exercise reasonable care to protect her from harm,26 to oversee or supervise all persons who practiced medicine
within its walls, and to take active steps in fixing any form of negligence committed within its premises.27 PSI committed a serious
breach of its corporate duty when it failed to conduct an immediate investigation into the reported missing gauzes.28

PSI is now asking this Court to reconsider the foregoing rulings for these reasons:

The declaration in the 31 January 2007 Decision vis-a-vis the 11 February 2009 Resolution that the ruling in Ramos vs. Court of Appeals
(G.R. No. 134354, December 29, 1999) that "an employer-employee relations exists between hospital and their consultants" stays
should be set aside for being inconsistent with or contrary to the import of the resolution granting the hospital's motion for
reconsideration in Ramos vs. Court of Appeals (G.R. No. 134354, April 11, 2002), which is applicable to PSI since the Aganas failed to
prove an employer-employee relationship between PSI and Dr. Ampil and PSI proved that it has no control over Dr. Ampil. In fact, the
trial court has found that there is no employer-employee relationship in this case and that the doctor's are independent contractors.

II

Respondents Aganas engaged Dr. Miguel Ampil as their doctor and did not primarily and specifically look to the Medical City Hospital
(PSI) for medical care and support; otherwise stated, respondents Aganas did not select Medical City Hospital (PSI) to provide medical
care because of any apparent authority of Dr. Miguel Ampil as its agent since the latter was chosen primarily and specifically based on
his qualifications and being friend and neighbor.

III

PSI cannot be liable under doctrine of corporate negligence since the proximate cause of Mrs. Agana's injury was the negligence of Dr.
Ampil, which is an element of the principle of corporate negligence. 29

In their respective memoranda, intervenors raise parallel arguments that the Court's ruling on the existence of an employer-employee
relationship between private hospitals and consultants will force a drastic and complex alteration in the long-established and currently
prevailing relationships among patient, physician and hospital, with burdensome operational and financial consequences and adverse
effects on all three parties.30

The Aganas comment that the arguments of PSI need no longer be entertained for they have all been traversed in the assailed decision
and resolution.31
After gathering its thoughts on the issues, this Court holds that PSI is liable to the Aganas, not under the principle of respondeat
superior for lack of evidence of an employment relationship with Dr. Ampil but under the principle of ostensible agency for the
negligence of Dr. Ampil and, pro hac vice, under the principle of corporate negligence for its failure to perform its duties as a hospital.

While in theory a hospital as a juridical entity cannot practice medicine,32 in reality it utilizes doctors, surgeons and medical
practitioners in the conduct of its business of facilitating medical and surgical treatment. 33 Within that reality, three legal relationships
crisscross: (1) between the hospital and the doctor practicing within its premises; (2) between the hospital and the patient being
treated or examined within its premises and (3) between the patient and the doctor. The exact nature of each relationship determines
the basis and extent of the liability of the hospital for the negligence of the doctor.

Where an employment relationship exists, the hospital may be held vicariously liable under Article 217634 in relation to Article 218035
of the Civil Code or the principle of respondeat superior. Even when no employment relationship exists but it is shown that the hospital
holds out to the patient that the doctor is its agent, the hospital may still be vicariously liable under Article 2176 in relation to Article
143136 and Article 186937 of the Civil Code or the principle of apparent authority. 38 Moreover, regardless of its relationship with the
doctor, the hospital may be held directly liable to the patient for its own negligence or failure to follow established standard of conduct
to which it should conform as a corporation.39

This Court still employs the "control test" to determine the existence of an employer-employee relationship between hospital and
doctor. In Calamba Medical Center, Inc. v. National Labor Relations Commission, et al. 40 it held:

Under the "control test", an employment relationship exists between a physician and a hospital if the hospital controls both the means
and the details of the process by which the physician is to accomplish his task.

xxx xxx xxx

As priorly stated, private respondents maintained specific work-schedules, as determined by petitioner through its medical director,
which consisted of 24-hour shifts totaling forty-eight hours each week and which were strictly to be observed under pain of
administrative sanctions.

That petitioner exercised control over respondents gains light from the undisputed fact that in the emergency room, the operating
room, or any department or ward for that matter, respondents' work is monitored through its nursing supervisors, charge nurses
and orderlies. Without the approval or consent of petitioner or its medical director, no operations can be undertaken in those areas.
For control test to apply, it is not essential for the employer to actually supervise the performance of duties of the employee, it
being enough that it has the right to wield the power. (emphasis supplied)

Even in its December 29, 1999 decision41 and April 11, 2002 resolution42 in Ramos, the Court found the control test decisive.

In the present case, it appears to have escaped the Court's attention that both the RTC and the CA found no employment relationship
between PSI and Dr. Ampil, and that the Aganas did not question such finding. In its March 17, 1993 decision, the RTC found "that
defendant doctors were not employees of PSI in its hospital, they being merely consultants without any employer-employee
relationship and in the capacity of independent contractors."43 The Aganas never questioned such finding.

PSI, Dr. Ampil and Dr. Fuentes appealed44 from the RTC decision but only on the issues of negligence, agency and corporate liability.
In its September 6, 1996 decision, the CA mistakenly referred to PSI and Dr. Ampil as employer-employee, but it was clear in its
discussion on the matter that it viewed their relationship as one of mere apparent agency. 45

The Aganas appealed from the CA decision, but only to question the exoneration of Dr. Fuentes. 46 PSI also appealed from the CA
decision, and it was then that the issue of employment, though long settled, was unwittingly resurrected.

In fine, as there was no dispute over the RTC finding that PSI and Dr. Ampil had no employer-employee relationship, such finding
became final and conclusive even to this Court.47 There was no reason for PSI to have raised it as an issue in its petition. Thus, whatever
discussion on the matter that may have ensued was purely academic.

Nonetheless, to allay the anxiety of the intervenors, the Court holds that, in this particular instance, the concurrent finding of the RTC
and the CA that PSI was not the employer of Dr. Ampil is correct. Control as a determinative factor in testing the employer-employee
relationship between doctor and hospital under which the hospital could be held vicariously liable to a patient in medical negligence
cases is a requisite fact to be established by preponderance of evidence. Here, there was insufficient evidence that PSI exercised the
power of control or wielded such power over the means and the details of the specific process by which Dr. Ampil applied his skills in
the treatment of Natividad. Consequently, PSI cannot be held vicariously liable for the negligence of Dr. Ampil under the principle of
respondeat superior.

There is, however, ample evidence that the hospital (PSI) held out to the patient (Natividad)48 that the doctor (Dr. Ampil) was its agent.
Present are the two factors that determine apparent authority: first, the hospital's implied manifestation to the patient which led the
latter to conclude that the doctor was the hospital's agent; and second, the patient’s reliance upon the conduct of the hospital and
the doctor, consistent with ordinary care and prudence. 49

Enrique testified that on April 2, 1984, he consulted Dr. Ampil regarding the condition of his wife; that after the meeting and as advised
by Dr. Ampil, he "asked [his] wife to go to Medical City to be examined by [Dr. Ampil]"; and that the next day, April 3, he told his
daughter to take her mother to Dr. Ampil. 50 This timeline indicates that it was Enrique who actually made the decision on whom
Natividad should consult and where, and that the latter merely acceded to it. It explains the testimony of Natividad that she consulted
Dr. Ampil at the instigation of her daughter. 51

Moreover, when asked what impelled him to choose Dr. Ampil, Enrique testified:

Atty. Agcaoili

On that particular occasion, April 2, 1984, what was your reason for choosing Dr. Ampil to contact with in connection with your wife's
illness?

A. First, before that, I have known him to be a specialist on that part of the body as a surgeon, second, I have known him to be a staff
member of the Medical City which is a prominent and known hospital. And third, because he is a neighbor, I expect more than the
usual medical service to be given to us, than his ordinary patients. 52 (emphasis supplied)

Clearly, the decision made by Enrique for Natividad to consult Dr. Ampil was significantly influenced by the impression that Dr. Ampil
was a staff member of Medical City General Hospital, and that said hospital was well known and prominent. Enrique looked upon Dr.
Ampil not as independent of but as integrally related to Medical City.

PSI's acts tended to confirm and reinforce, rather than negate, Enrique's view. It is of record that PSI required a "consent for hospital
care"53 to be signed preparatory to the surgery of Natividad. The form reads:

Permission is hereby given to the medical, nursing and laboratory staff of the Medical City General Hospital to perform such diagnostic
procedures and to administer such medications and treatments as may be deemed necessary or advisable by the physicians of this
hospital for and during the confinement of xxx. (emphasis supplied)

By such statement, PSI virtually reinforced the public impression that Dr. Ampil was a physician of its hospital, rather than one
independently practicing in it; that the medications and treatments he prescribed were necessary and desirable; and that the hospital
staff was prepared to carry them out.1avvphi1

PSI pointed out in its memorandum that Dr. Ampil's hospital affiliation was not the exclusive basis of the Aganas’ decision to have
Natividad treated in Medical City General Hospital, meaning that, had Dr. Ampil been affiliated with another hospital, he would still
have been chosen by the Aganas as Natividad's surgeon. 54

The Court cannot speculate on what could have been behind the Aganas’ decision but would rather adhere strictly to the fact that,
under the circumstances at that time, Enrique decided to consult Dr. Ampil for he believed him to be a staff member of a prominent
and known hospital. After his meeting with Dr. Ampil, Enrique advised his wife Natividad to go to the Medical City General Hospital to
be examined by said doctor, and the hospital acted in a way that fortified Enrique's belief.

This Court must therefore maintain the ruling that PSI is vicariously liable for the negligence of Dr. Ampil as its ostensible agent.

Moving on to the next issue, the Court notes that PSI made the following admission in its Motion for Reconsideration:

51. Clearly, not being an agent or employee of petitioner PSI, PSI [sic] is not liable for Dr. Ampil's acts during the operation. Considering
further that Dr. Ampil was personally engaged as a doctor by Mrs. Agana, it is incumbent upon Dr. Ampil, as "Captain of the Ship", and
as the Agana's doctor to advise her on what to do with her situation vis-a-vis the two missing gauzes. In addition to noting the missing
gauzes, regular check-ups were made and no signs of complications were exhibited during her stay at the hospital, which could
have alerted petitioner PSI's hospital to render and provide post-operation services to and tread on Dr. Ampil's role as the doctor
of Mrs. Agana. The absence of negligence of PSI from the patient's admission up to her discharge is borne by the finding of facts in
this case. Likewise evident therefrom is the absence of any complaint from Mrs. Agana after her discharge from the hospital which
had she brought to the hospital's attention, could have alerted petitioner PSI to act accordingly and bring the matter to Dr. Ampil's
attention. But this was not the case. Ms. Agana complained ONLY to Drs. Ampil and Fuentes, not the hospital. How then could PSI
possibly do something to fix the negligence committed by Dr. Ampil when it was not informed about it at all.55 (emphasis supplied)

PSI reiterated its admission when it stated that had Natividad Agana "informed the hospital of her discomfort and pain, the hospital
would have been obliged to act on it."56

The significance of the foregoing statements is critical.

First, they constitute judicial admission by PSI that while it had no power to control the means or method by which Dr. Ampil conducted
the surgery on Natividad Agana, it had the power to review or cause the review of what may have irregularly transpired within its
walls strictly for the purpose of determining whether some form of negligence may have attended any procedure done inside its
premises, with the ultimate end of protecting its patients.

Second, it is a judicial admission that, by virtue of the nature of its business as well as its prominence 57 in the hospital industry, it
assumed a duty to "tread on" the "captain of the ship" role of any doctor rendering services within its premises for the purpose of
ensuring the safety of the patients availing themselves of its services and facilities.

Third, by such admission, PSI defined the standards of its corporate conduct under the circumstances of this case, specifically: (a) that
it had a corporate duty to Natividad even after her operation to ensure her safety as a patient; (b) that its corporate duty was not
limited to having its nursing staff note or record the two missing gauzes and (c) that its corporate duty extended to determining Dr.
Ampil's role in it, bringing the matter to his attention, and correcting his negligence.

And finally, by such admission, PSI barred itself from arguing in its second motion for reconsideration that the concept of corporate
responsibility was not yet in existence at the time Natividad underwent treatment; 58 and that if it had any corporate responsibility,
the same was limited to reporting the missing gauzes and did not include "taking an active step in fixing the negligence committed."59
An admission made in the pleading cannot be controverted by the party making such admission and is conclusive as to him, and all
proofs submitted by him contrary thereto or inconsistent therewith should be ignored, whether or not objection is interposed by a
party.60

Given the standard of conduct that PSI defined for itself, the next relevant inquiry is whether the hospital measured up to it.

PSI excuses itself from fulfilling its corporate duty on the ground that Dr. Ampil assumed the personal responsibility of informing
Natividad about the two missing gauzes.61 Dr. Ricardo Jocson, who was part of the group of doctors that attended to Natividad,
testified that toward the end of the surgery, their group talked about the missing gauzes but Dr. Ampil assured them that he would
personally notify the patient about it.62 Furthermore, PSI claimed that there was no reason for it to act on the report on the two
missing gauzes because Natividad Agana showed no signs of complications. She did not even inform the hospital about her
discomfort.63

The excuses proffered by PSI are totally unacceptable.

To begin with, PSI could not simply wave off the problem and nonchalantly delegate to Dr. Ampil the duty to review what transpired
during the operation. The purpose of such review would have been to pinpoint when, how and by whom two surgical gauzes were
mislaid so that necessary remedial measures could be taken to avert any jeopardy to Natividad’s recovery. Certainly, PSI could not
have expected that purpose to be achieved by merely hoping that the person likely to have mislaid the gauzes might be able to retrace
his own steps. By its own standard of corporate conduct, PSI's duty to initiate the review was non-delegable.

While Dr. Ampil may have had the primary responsibility of notifying Natividad about the missing gauzes, PSI imposed upon itself the
separate and independent responsibility of initiating the inquiry into the missing gauzes. The purpose of the first would have been to
apprise Natividad of what transpired during her surgery, while the purpose of the second would have been to pinpoint any lapse in
procedure that led to the gauze count discrepancy, so as to prevent a recurrence thereof and to determine corrective measures that
would ensure the safety of Natividad. That Dr. Ampil negligently failed to notify Natividad did not release PSI from its self-imposed
separate responsibility.

Corollary to its non-delegable undertaking to review potential incidents of negligence committed within its premises, PSI had the duty
to take notice of medical records prepared by its own staff and submitted to its custody, especially when these bear earmarks of a
surgery gone awry. Thus, the record taken during the operation of Natividad which reported a gauze count discrepancy should have
given PSI sufficient reason to initiate a review. It should not have waited for Natividad to complain.

As it happened, PSI took no heed of the record of operation and consequently did not initiate a review of what transpired during
Natividad’s operation. Rather, it shirked its responsibility and passed it on to others – to Dr. Ampil whom it expected to inform
Natividad, and to Natividad herself to complain before it took any meaningful step. By its inaction, therefore, PSI failed its own standard
of hospital care. It committed corporate negligence.

It should be borne in mind that the corporate negligence ascribed to PSI is different from the medical negligence attributed to Dr.
Ampil. The duties of the hospital are distinct from those of the doctor-consultant practicing within its premises in relation to the
patient; hence, the failure of PSI to fulfill its duties as a hospital corporation gave rise to a direct liability to the Aganas distinct from
that of Dr. Ampil.

All this notwithstanding, we make it clear that PSI’s hospital liability based on ostensible agency and corporate negligence applies only
to this case, pro hac vice. It is not intended to set a precedent and should not serve as a basis to hold hospitals liable for every form of
negligence of their doctors-consultants under any and all circumstances. The ruling is unique to this case, for the liability of PSI arose
from an implied agency with Dr. Ampil and an admitted corporate duty to Natividad. 64

Other circumstances peculiar to this case warrant this ruling,65 not the least of which being that the agony wrought upon the Aganas
has gone on for 26 long years, with Natividad coming to the end of her days racked in pain and agony. Such wretchedness could have
been avoided had PSI simply done what was logical: heed the report of a guaze count discrepancy, initiate a review of what went
wrong and take corrective measures to ensure the safety of Nativad. Rather, for 26 years, PSI hemmed and hawed at every turn,
disowning any such responsibility to its patient. Meanwhile, the options left to the Aganas have all but dwindled, for the status of Dr.
Ampil can no longer be ascertained.66

Therefore, taking all the equities of this case into consideration, this Court believes ₱15 million would be a fair and reasonable liability
of PSI, subject to 12% p.a. interest from the finality of this resolution to full satisfaction.

WHEREFORE, the second motion for reconsideration is DENIED and the motions for intervention are NOTED.

Professional Services, Inc. is ORDERED pro hac vice to pay Natividad (substituted by her children Marcelino Agana III, Enrique Agana,
Jr., Emma Agana-Andaya, Jesus Agana and Raymund Agana) and Enrique Agana the total amount of ₱15 million, subject to 12% p.a.
interest from the finality of this resolution to full satisfaction.

No further pleadings by any party shall be entertained in this case.

Let the long-delayed entry of judgment be made in this case upon receipt by all concerned parties of this resolution.

SO ORDERED.