Civ 2 digest Torts

Torts and damages: Introduction: quasi-delict distinguished from tort, crime and contract

G.R. No. 212690 *

February 20, 2017

SPOUSES ROMEO PAJARES and IDA T. PAJARES, Petitioners 

vs.
REMARKABLE LAUNDRY AND DRY CLEANING, represented by ARCHEMEDES G.
SOLIS, Respondent

Facts:

On September 3, 2012, Remarkable Laundry and Dry Cleaning (respondent) filed a Complaint
denominated as “Breach of Contracts and Damages” against Spouses Pajares (petitioners) which
was assigned to Branch 17 of the Regional Trial Court of Cebu. Respondents alleged that it
entered into a Remarkable Dealer Outlet Contract with the petitioners, whereby the latter,
acting as a dealer outlet, shall accept and receive items or materials for laundry which are then
picked up and processed by the former in its main plant or laundry outlet; that petitioners
violated Article IV (Standard Required Quota & Penalties) of said contracts, which required them
to produce at least 200 kilos of laundry items each week.

The Petitioners ceased dealer operations on account of lack of personnel. Respondents made
written demands upon petitioners for the payment of penalties imposed and provided for in the
contract, which the Petitioners failed to pay. The petitioners’ violation constitutes breach of
contract.

The Regional Trial Court issued an Order dismissing the case for lack of Jurisdiction. On appeal to
the Court of Appeals, the Order of the RTC was reversed and set aside. Hence, this petition.

Issue:

Whether or Not the Court of Appeals erred in declaring the Regional Trial Court had jurisdiction
over respondent’s Complaint which, although denominated as one for breach of contract, is
essentially one for simple payment of damages

Ruling:

Respondent's complaint denominated as one for "'Breach of Contract &

Damages" is neither an action for specific performance nor a complaint
for rescission of contract.

In ruling that respondent's Complaint is incapable of pecuniary estimation and that the RTC
has jurisdiction, the CA comported itself with the following ratiocination:

A case for breach of contract [sic] is a cause of action either for specific performance or
rescission of contracts. An action for rescission of contract, as a counterpart of an action for
specific performance, is incapable of pecuniary estimation, and therefore falls under the
jurisdiction of the RTC. 24

without, however, determining whether, from the four corners of the Complaint, respondent
actually intended to initiate an action for specific performance or an action for rescission of
contract. Specific performance is ''[t]he remedy of requiring exact performance of a contract
in the specific form in which it was made, or according to the precise terms agreed upon. [It
is t]he actual accomplishment of a contract by a party bound to fulfill it."  Rescission of
25

contract under Article 1191 of the Civil Code, on the other hand, is a remedy available to the
obligee when the obligor cannot comply with what is incumbent upon him.  It is predicated
26
on a breach of faith by the other party who violates the reciprocity between them. Rescission
may also refer to a remedy granted by law to the contracting parties and sometimes even to
third persons in order to secure reparation of damages caused them by a valid contract; by
means of restoration of things to their condition in which they were prior to the celebration of
the contract.

 ROMULO ABROGAR and ERLINDA ABROGAR, vs. COSMOS BOTTLING

COMPANY and INTERGAMES, INC.,
G.R. No. 164749 March 15, 2017 
TORTS DAMAGES

FACTS

Cosmos along with Intergames, organized an endurance running contest billed as the “1 st Pop-
Cola Junior Marathon”. Plaintiffs’ son Rommel applied to be allowed to participate, after
complying with defendants' requirements, his application was accepted and he was given an
official number. Rommel was bumped by a jeepney that was then running along the route of
the marathon on Don Mariano Marcos A venue (DMMA for brevity), and in spite of medical
treatment given to him at the Ospital ng Bagong Lipunan, he died later that same day due to
severe head injuries.

the petitioners sued the respondents in the then Court of First Instance of Rizal (Quezon
City) to recover various damages for the untimely death of Rommel (i.e., actual and
compensatory damages, loss of earning capacity, moral damages, exemplary damages,
attorney's fees and expenses oflitigation)

RTC rendered a judgement in favour of the plaintiffs and held Cosmos and Intergames liable
for the death of Rommel.

Upon Appeal to the Court of Appeals, the decision of the RTC reversed and set aside.

Issue:

Whether or not the CA erred when it held respondents free from liability and in not awarding
petitioners with actual, moral and exemplary damages for the death of their child, Rommel
Abrogar.

Ruling:

Article 2202 of the Civil Code lists the damages that the plaintiffs in a suit upon crimes and
quasi-delicts can recover from the defendant, viz.:

Art. 2202. In crimes and quasi-delicts, the defendant shall be liable for all damages which
are the natural and probable consequences of the act or omission complained of. It is not
necessary that such damages have been foreseen or could have reasonably been foreseen
by the defendant.

Accordingly, Intergames was liable for all damages that were the natural and probable
consequences of its negligence. In its judgment, the RTC explained the award of damages in
favor of the petitioners, as follows:
As borne by the evidence on record, the plaintiffs incurred medical, hospitalization and burial
expenses for their son in this aggregate amount of ₱28,061.65 (Exhibits "D'', "D-1" and "D-
2"). In instituting this case, they have paid their lawyer ₱5,000 as initial deposit, their
arrangement being that they would pay attorney's fees to the extent of 10% of whatever
amount would be awarded to them in this case.

For the loss of a son, it is unquestionable that plaintiffs suffered untold grief which should
entitle them to recover moral damages, and this Court believes that if only to assuage
somehow their untold grief but not necessarily to compensate them to the fullest, the nominal
amount of ₱l00,00.00 should be paid by the defendants.

For failure to adopt elementary and basic precautionary measure to insure the safety of the
participants so that sponsors and organizers of sports events should exercise utmost
diligence in preventing injury to the participants and the public as well, exemplary damages
should also be paid by the defendants and this Court considers the amount of ₱50,000.00

as reasonable.

ROSALIE SY AYSON, vs. FIL-ESTATE PROPERTIES, INC., and FAIRWAYS AND

BLUEWATER RESORT AND COUNTRY CLUB, INC.,
G.R. No. 223254 December 1, 2016
6
The instant case arose from a Complaint  for recovery of possession and damages filed by Ayson
against Fil-Estate and Fairways before the RTC, alleging that she is the registered owner of a 1,000-
square meter parcel of land covered by Transfer Certificate of Title (TCT) No. T-24562. Sometime in
June 1997, she discovered that Fil-Estate and Fairways illegally entered into the subject land and
included it in the construction of its golf course without her prior consent and authorization. Despite
receipt of a Notice to Cease and Desist from Ayson, Fil-Estate and Fairways continued their
encroachment and development of the subject land making it now a part of the entire golf course.
Thus, she was constrained to file the complaint.

The RTC ruled in Ayson’s favour ordering Fil-estate and Fairways to pay Ayson fees which included
moral, exemplary and actual damages which was affirmed by the Court of Appeals.

Issue: Whether or not there is a basis for the moral and exemplary damages awarded to petitioner

Ruling:

To recapitulate, both the RTC and the CA found that Ayson is the undisputed owner of the subject
land, as evidenced by TCT No. T-24562. Despite such knowledge, Fil-Estate and Fairways
nevertheless chose to rely on Villanueva's empty assurances that she will be able to convince Ayson
to agree on a land swap arrangement; and thereafter, proceeded to enter the subject land and
introduce improvements thereon. The courts a quo further found that since such acts were without
Ayson's knowledge and consent, she, thus: (a)  suffered sleepless nights and mental anguish
knowing that the property she and her husband had invested for their future retirement had been
utilized by Fil-Estate and Fairways for their own sake; and (b) had to seek legal remedies to
vindicate her rights. Thus, both lower courts concluded that Fil-Estate and Fairways' acts were done
in bad faith and resulted in injury to Ayson; hence, they are liable for, inter alia,  moral damages,
exemplary damages, and attorney's fees.

PHILIPPINE STOCK EXCHANGE, INC. vs. ANTONIO K. LITONJUA 1 AND

AURELIO K. LITONJUA, JR.,
G.R. No. 204014 December 5, 2016
Facts: On 20 April 1999, the Litonjua Group wrote a letter-agreement to Trendline Securities, Inc.
(Trendline) through its President Priscilla D. Zapanta (Zapanta), confirming a previous agreement
for the acquisition of the 85% majority equity of Trendline's membership seat in PSE, a domestic
stock corporation licensed by the Securities and Exchange Commission (SEC) to engage in the
business of operating a market for the buying and selling of securities.

The letter and checks were received by the PSE from Trendline on 13 May 1999 as evidenced by
Official Receipt Number 42264. It bore an annotation that the checks were received as an advance
payment for full settlement of Trendline's outstanding obligation to PSE

Despite several exchange of letters of conformity and delivery of checks representing payment of
full settlement of Trendline's obligations, PSE failed to lift the suspension imposed on Trendline's
seat. The Litonjua Group, through a letter, requested PSE to reimburse the P19,000,000.00 it had
paid with interest, upon knowledge that the specific performance by PSE of transferring the
membership seat under the agreement will no longer be possible.

PSE, however, refused to refund the claimed amount as without any legal basis. As a result, the
Litonjua Group on 10 October 2006 filed a Complaint for Collection of Sum of Money with Damages
against PSE before the RTC of Pasig City

Issue:

Whether or not PSE is liable to pay exemplary damages

Ruling:

In contracts and quasi-contracts, the court may award exemplary damages if the defendant acted in
a wanton, fraudulent, reckless, oppressive, or malevolent manner. Exemplary damages cannot be
recovered as a matter of right; the court will decide whether or not they should be
adjudicated. While the amount of the exemplary damages need not be proven, the plaintiff must
show that he is entitled to moral, temperate or compensatory damages before the court may
consider the question of whether or not exemplary damages should be awarded.

PSE, despite demands by the Litonjua Group, continuously refused to return the money received
despite the fact that it received it without any legal right to do so. This conduct, as found by the
trial court, falls within the purview of wanton, oppressive and malevolent in nature. Further, we find
the words of the appellate court on its justification of the award meritorious:

We cannot blame the Litonjua Group for believing that the actions of the PSE are as good as giving
consent to the subject agreement. And, it surely came as a surprise on the part of the Litonjua
Group to know that none of the PSE's dealings can be considered as approval of the agreement. It
appears that these actions of the PSE, if it cannot be considered fraudulent, were definitely made
with recklessness. As huge amount of money (P19 Million) were involved, the PSE could have been
more cautious or wary in dealing with the Litonjua Group. It should have avoided making actions
that would send wrong signal to the other party with which it was transacting. Hence, we have no
choice but to conclude that PSE acted with recklessness that would warrant an award of exemplary
damages in favor of the Litonjua Group.

Thus, absent any other compelling reason to overturn the findings, we uphold the award of
exemplary damages.

Elements of Quasi Delict

Concepcion C. Daplas Vs. Department of Finance and the Office of the Ombudsman
G.R. No. 221153 April 17, 2017

FACTS:
Petitioner joined the government service as a casual clerk for the Municipal Treasurer of
Kawit, Cavite sometime in 1968, and had held various posts until she was appointed as the
Pasay City Treasurer on May 19, 1989, with a gross monthly salary of ₱28,722.00. At the
time material to the complaints, petitioner was concurrently holding the position of Officer-in-
Charge, Regional Director of the Bureau of Local Government Finance (BLGF) in Cebu City.

Two (2) separate complaints were filed against petitioner by the Department of Finance-
Revenue Integrity Protection Service (DOF-RIPS) and the Field Investigation Office (FIO) of
the Office of the Ombudsman (Ombudsman; respondents) for averred violations of Sections
7 and 8 of RA 3019, Section 8 (A) of RA 6713,8 Section 2 of RA 1379, Article 183 of the
Revised Penal Code (RPC), and Executive Order No. (EO) 6 dated March 12, 1986,
constituting Dishonesty, Grave Misconduct, and Conduct Prejudicial to the Best Interest of
the Service, arising out of her failure to disclose the true and detailed statement of her
assets, liabilities, and net worth, business interests, and financial connections, and those of
her spouse in her Statements of Assets, Liabilities, and Net Worth (SALNs).

The Ombudsman found petitioner guilty of Dishonesty, Grave Misconduct, and violation of
Section 8 (A) of RA 6713, and imposed the penalty of Dismissal, and its accessory penalties,
without prejudice to criminal prosecution. In a Decisiondated August 27, 2014, the CA
dismissed the petition, holding that the Ombudsman's ruling was sufficiently supported by
substantial evidence.  It found that petitioner's failure to declare all her assets and business
interests constituted Dishonesty, Grave Misconduct, and a violation of Section 8 (A) of RA
6713.

ISSUE
 Whether or not the CA correctly affirmed the Joint Decision of the Ombudsman finding
petitioner liable for Dishonesty, Grave Misconduct, and violation of Section 8 (A) of RA 6713,
and imposing on her the corresponding penalties

RULING

Negligence is the omission of the diligence which is required by the nature of the obligation
and corresponds with the circumstances of the persons, of the time, and of the place. In the
case of public officials, there is negligence when there is a breach of duty or failure to
perform the obligation, and there is gross negligence when a breach of duty is flagrant and
palpable. An act done in good faith, which constitutes only an error of judgment and
for no ulterior motives and/or purposes, as in the present case, is merely Simple
Negligence.

In the same vein, petitioner's failure to declare the Galant sedan in her SALNs from 1997 to
2003 stemmed from the fact that the same was registered in her husband's name, and
purportedly purchased out of his personal money. While such bare allegation is not enough
to overthrow the presumption that the car was conjugal, neither is there sufficient showing
that petitioner was motivated by bad faith in not disclosing the same. In fact, the
Ombudsman conceded that petitioner's husband was financially capable of purchasing the
car, negating any "unexplained wealth" to warrant petitioner's dismissal due to Dishonesty.

Negligence

Ultra Mar Aqua Resource, Inc., represented by its President Victor B. Prieto Vs.
Fermida Construction Services, represented by its General Manager Myrna T.
Ramos

G.R. No. 191353 April 17, 2017

Facts:
On December 8, 2003, Fermida entered into a Contract Agreement with Ultra Mar for the
construction of a warehouse in Wawandue, Subic, Zambales (Project) with a contract price
of PhPl,734,740. In the course of construction, variations as to roof coverage, drainage
canal, painting and electrical work were made by Fermida upon Ultra Mar's request and
instructions. 

After completing the Project on January 17, 2004, Fermida sent to Ultra Mar a Billing
Statement exclusive of the cost of variation orders and extra work orders made. Pursuant to
the parties' agreement, Fermida secured a Surety Bond to satisfy the 10 percent retention to
cover any defect in materials and workmanship. A Contractor's Affidavit stating that all claims
and obligations for labor services, materials supplied, equipment and tools have been fully
settled was likewise executed.

However, Ultra Mar refused to pay because of Fermida's alleged failure to submit the PDT
Report and Building Permits, and substandard work and delay in the completion of the
Project. Consequently, Fermida commenced the Complaint for Collection of Sum of Money
with Prayer for Injunction before the RTC.

Despite several resettings, counsel for Ultra Mar failed to attend the pre-trial conference and
failed to file the required pre-trial brief. As a result, the RTC declared Ultra Mar in default and
allowed Fermida to present its evidence ex parte. On September 8, 2004, Ultra Mar, through
counsel, filed an Omnibus Motion to Lift Order of Default, Admit Attached Pre-Trial Brief and
Set the Case for Pre-Trial Conference   (Omnibus Motion) alleging that his failure to file the
14

Pre-Trial Brief was due to the intermittent nausea he was experiencing as a result of a
sudden drop in his blood sugar level. Affording leniency, the RTC required a supporting
Medical Certificate upon submission of which Ultra Mar's Omnibus Motion shall be resolved.
Ultra Mar's counsel failed to comply with the said Order thus the RTC denied Ultra Mar's
Omnibus Motion.

Issue:

Whether or Not the Court of Appeals erred in not relieving the petitioner from the effects of
gross negligence of its counsel Atty. Leonuel Mas who despite receipt of the Decision of the
Trial Court on October 15, 2004 did not inform the petitioner albeit deceivingly sent the
petitioner a report dated November 26, 2004 that he moved the case be set for pre-trial.

Ruling:

Ultra Mar would nevertheless point an accusing finger at its counsel for the latter's gross
negligence. However, nothing is more settled than the rule that the negligence and mistakes
of a counsel are binding on the client.

The rationale for this rule is reiterated in the case of Lagua v. Court of Appeals  :
32

"The general rule is that a client is bound by the counsel['s] acts, including even mistakes in
the realm of procedural technique. The rationale for the rule is that a counsel, once retained,
holds the implied authority to do all acts necessary or, at least, incidental to the prosecution
and management of the suit in behalf of his client, such that any act or omission by counsel
within the scope of the authority is regarded, in the eyes of the law, as the act or omission of
the client himself."

Ultra Mar, on the other hand, has the following concomitant obligation:

"As clients, petitioners should have maintained contact with their counsel from time to time,
and informed themselves of the progress of their case, thereby exercising that standard of
care which an ordinarily prudent man bestows upon his business.
Even in the absence of the petitioner['s] negligence, the rule in this jurisdiction is that a party
is bound by the mistakes of his counsel. In the earlier case of Tesoro v. Court of Appeals, we
emphasized.

DELA CRUZ VS. OCTAVIANO

GR. NO. 219649 JULY 26, 2017

FACTS:

Around 9:00 p.m. on April 1, 1999, respondent Captain Renato Octaviano, a military dentist
assigned at the Office of the Chief Dental Service, Armed Forces of the Philippines, Camp
Aguinaldo, Quezon City, respondent Wilma Octaviano, Renato's mother and Janet
Octaviano, Renato's sister, rode a tricycle driven by Eduardo Y. Padilla. Respondent Wilma
and Janet were inside the sidecar of the vehicle, while Renato rode at the back of the tricycle
driver. They then proceeded to Naga Road towards the direction of CAA and BF Homes.
Renato was asking his mother for a change to complete his ₱l0.00 bill when he looked at the
road and saw a light from an oncoming car which was going too fast. The car, driven by
petitioner, hit the back portion of the tricycle where Renato was riding. 

Renato, hb mother, and Janet were brought to Perpetual Help Medical Center where
Renato's leg was amputated from below the knee on that same night. After his treatment at
Perpetual Help Medical Center, Renato was brought to the AFP Medical Center at V. Luna
General Hospital and stayed there for nine months for rehabilitation. Shortly before his
discharge at V. Luna, he suffered bone infection. He was brought to Fort Bonifacio Hospital
where he was operated on thrice for bone infection. Thereafter, he was treated at the same
hospital for six months. In the year 2000, he had a prosthesics attached to his leg at V. Luna
at his own expense. Renato spent a total of ₱623,268.00 for his medical bills and
prosthetics. Thus, Renato and his mother Wilma filed with the RTC a civil case for damages
against petitioner and the owner of the vehicle.

The RTC, in its Decision dated February 24, 2009, dismissed the claim of respondents.
According to the RTC, petitioner's version of the incident was more believable because it
was corroborated by Sgt. Martinez who testified that he saw an Elf van parked along the
street.It was also ruled that the liability rests on the tricycle driver who drove without license
and petitioner's contributory negligence in riding at the back of the driver in violation of
Municipal Ordinance No. 35-88 that limits the passengers of a tricycle to three persons
including the driver. the CA reversed the RTC's decision.

Issue:

Whether or Not THE COURT OF APPEALS GRAVELY ERRED IN FAILING TO CONSIDER

THAT THE PROXIMATE CAUSE OF THE INCIDENT WAS THE FAULT OR GROSS
NEGLIGENCE OF THE TRICYCLE DRIVER.

Ruling:

In order for liability from negligence to arise, there must be not only proof of damage and
negligence, but also proof that the damage was the consequence of the negligence. The
Court has said in Vda. de Gregorio v. Go Chong Bing: 14

x x x Negligence as a source of obligation both under the civil law and in American cases
was carefully considered and it was held:

We agree with counsel for appellant that under the Civil Code, as under the generally
accepted doctrine in the United States, the plaintiff in an action such as that under
consideration, in order to establish his right to a recovery, must establish by competent
evidence:

(1) Damages to the plaintiff.

(2) Negligence by act or omission of which defendant personally or some person for whose
acts it must respond, was guilty.

(3) The connection of cause and effect between the negligence and the damage."

Contributory negligence is conduct on the part of the injured party, contributing as a legal
cause to the harm he has suffered, which falls below the standard to which he is required to
conform for his own protection. To hold a person as having contributed to his injuries, it must
be shown that he performed an act that brought about his injuries in disregard of warning or
signs of an impending danger to health and body. To prove contributory negligence, it is still
necessary to establish a causal link, although not proximate, between the negligence of the
party and the succeeding injury. In a legal sense, negligence is contributory only when it
contributes proximately to the injury, and not simply a condition for its occurrence. In this
case, the causal link between the alleged negligence of the tricycle driver and respondent
Renato was not established. This court has appreciated that negligence per se, arising from
the mere violation of a traffic statute, need not be sufficient in itself in establishing liability for
damages.

The trial court absolved defendants of liability because of the failure of the plaintiffs to
present the tricycle driver and thus concluding that plaintiffs suppressed evidence adverse to
them. This is error on the part of the trial court. The non-presentation of the tricycle driver as
a witness does not affect the claim of the plaintiffs-appellants against herein defendants-
appellees. Even granting that the tricycle driver was presented in court and was proved
negligent, his negligence cannot cancel out the negligence of defendant Dela Cruz, because
their liabilities arose from different sources. The obligation or liability of the tricycle driver
arose out of the contract of carriage between him and petitioners whereas defendant Dela
Cruz is liable under Article 2176 of the Civil Code or under quasi-delicts. There is ample
evidence to show that defendant Dela Cruz was negligent within the purview of Article 2176
of the Civil Code, hence, he cannot escape liability.

Breach of Contract damages

PRYCE PROPERTIES CORPORATION vs. SPOUSES SOTERO OCTOBRE, JR.

and HENRISSA A. OCTOBRE, and CHINA BANKING CORPORATION

G.R. No. 186976 December 7, 2016

FACTS:

On July 22, 1997, respondent Spouses Sotero Octobre, Jr. and

Henrissa A. Octobre (Spouses Octobre) signed a Reservation
Agreement with petitioner Pryce Properties Corporation (Pryce) for
the purchase of two lots with a total of 742 square meters located in
Puerto Heights Village, Puerto Heights, Cagayan de Oro City. The
parties subsequently executed a Contract to Sell over the lot for the
price of P2,897,510.00 on January 7, 1998.

On February 4, 2004, Pryce issued a certification that Spouses

Octobre had fully paid the purchase price and amortization interests,
as well as the transfer fees and other charges in relation to the
property, amounting to a total of P4,292,297.92. But Pryce had yet to
deliver the certificates of title, which prompted Spouses Octobre to
formally demand its delivery. Despite repeated demands, Pryce failed
to comply. Thus, on May 18, 2004, Spouses Octobre filed a complaint
before the Housing and Land Use Regulatory Board (HLURB),
Regional Office No. 10 for specific performance, revocation of
certificate of registration, refund of payments, damages and
attorney's fees.

It appears that the reason why Pryce was unable to deliver the titles to
Spouses Octobre is because it had previously transferred custody of
the titles, along with others pertaining to the same development
project, to China Banking Corporation (China Bank) as part of the
Deed of Assignment. When Pryce defaulted in its loan obligations to
China Bank sometime in May 2002, China Bank refused to return the
titles to Pryce.

The HLURB Arbiter rendered a Decision dated March 31, 2005

finding that Spouses Octobre had no cause of action against China
Bank and rescinding the contract between Pryce and Spouses
Octobre. On appeal, the HLURB Board of Commissioners modified
the Decision by ordering Pryce to pay the redemption value to China
Bank so that the latter may release the titles covering the lots
purchased by Spouses Octobre. In default thereof, Pryce shall refund
the payments with legal interest. The HLURB Board upheld the grant
of compensatory damages, attorney's fees and costs to Spouses
Octobre. The Court of Appeals held that Pryce's contractual breach
justified the award of compensatory damages as well as the payment
of attorney's fees and costs of suit.

ISSUE:

Whether the Court of Appeals erred in upholding the award of

compensatory damages because Spouses Octobre failed to present
competent proof of the actual amount of loss.

Ruling:

Article 2199 of the Civil Code defines actual or compensatory

damages:
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. (Emphasis supplied.)
To be entitled to compensatory damages, the amount of loss must
therefore be capable of proof and must be actually proven with a
reasonable degree of certainty, premised upon competent proof or the
best evidence obtainable. The burden of proof of the damage suffered
is imposed on the party claiming the same, who should adduce the
best evidence available in support thereof. Its award must be based
on the evidence presented, not on the personal knowledge of the
court; and certainly not on flimsy, remote, speculative and non-
substantial proof.
It is clear that the amount paid by Spouses Octobre to Pryce as
purchase price for the lots has been adequately proved. There is no
dispute that Spouses Octobre are entitled to such amount with legal
interest. The issue being raised by Pryce is only with respect to the
P30,000.00 awarded as compensatory damages.

Negligence standard degree of negligence

PHILIPPINE NATIONAL BANK vs. PABLO V. RAYMUNDO,

G.R. No. 208672 December 7, 2016

Facts:

On July 30, 1993, accused-appellee Pablo V. Raymundo (Raymundo),

then Department Manager of PNB San Pedro Branch, approved for
deposit a foreign draft check dated June 23, 1993, in the amount of
$172,549.00 issued by Solomon Guggenheim Foundation, drawn
against Morgan Guaranty Company of New York, payable to Merry May
Juan (Ms. Juan) in the opening of the latter’s checking account with
PNB San Pedro Branch. The six (6) checks were negotiated by Ms.
Juan and were approved for payment on the same day by Raymundo,
without waiting for the foreign draft check, intended to fund the issued
check, to be cleared by the PNB Foreign Currency Clearing Unit.

On August 2, 1993, the PNB Foreign Checks Unit and Clearing Services
received the foreign draft check for negotiation with Morgan Trust
Company of New York, through PNB’s correspondent bank in New York,
the Banker’s Trust Co. of New York.  The PNB received a telex
message from BTCNY that the foreign draft check was dishonored for
being fraudulent. Subsequent to the said telex message, a letter dated
August 20, 1993 was sent by BTCNY to the PNB Corporate Auditor
stating the same reason for such dishonor.

For irregularly approving the payment of the six (6) checks issued by
Ms. Juan, without waiting for the foreign draft check to be cleared,
Raymundo, as then Department Manager of PNB San Pedro Branch,
was administratively charged by PNB for Conduct Prejudicial to the
Interest of the Service and/or Gross Violation of Bank’s Rules and
Regulations.
Issue:

Whether there was lack of malice or bad faith, nor negligence on the
part of Raymundo in approving the payment of the checks

Ruling:

Since their business and industry are imbued with public interest,
banks are required to exercise extraordinary diligence, which is more
than that of a Roman pater familias or a good father of a family, in
handling their transactions.[18] Banks are also expected to exercise the
highest degree of diligence in the selection and supervision of their
employees. By the very nature of their work in handling millions of
pesos in daily transactions, the degree of responsibility, care and
trustworthiness expected of bank employees and officials is far greater
than those of ordinary clerks and employees.

A bank’s disregard of its own banking policy amounts to gross

negligence, which is described as “negligence characterized by the
want of even slight care, acting or omitting to act in a situation where
there is duty to act, not inadvertently but willfully and unintentionally
with a conscious indifference to consequences insofar as other
persons may be affected.” Payment of the amounts of checks without
previously clearing them with the drawee bank, especially so where
the drawee bank is a foreign bank and the amounts involved were
large, is contrary to normal or ordinary banking practice. ] Before the
check shall have been cleared for deposit, the collecting bank can only
assume at its own risk that the check would be cleared and paid
out. As a bank Branch Manager, Raymundo is expected to be an expert
in banking procedures, and he has the necessary means to ascertain
whether a check, local or foreign, is sufficiently funded.

Raymundo’s act of approving the deposit to Ms. Juan’s newly-opened

peso checking account of the peso conversion [P4,752,689.65] of the
foreign check prior to the lapse of the 21-day clearing period is the
proximate cause why the six (6) checks worth P4,000,000.00 were
later encashed, thereby causing the PNB undue injury. Defined as that
cause which, in natural and continuous sequence, unbroken by any
efficient intervening cause, produces injury and without which the
result would not have occurred, the proximate cause can be
determined by asking a simple question: “If the event did not happen,
would the injury have resulted? If the answer is no, then the event is
the proximate cause.” If Raymundo did not disregard the bank’s
foreign check clearing policy when he approved crediting of the peso
conversion of Ms. Juan’s foreign check in her newly-opened peso
checking account, the PNB would not have suffered losses due to the
irregular encashment of the six (6) checks.
Torts Res ipsa loquitor

EDDIE CORTEL y CARNA and YELLOW BUS LINE, INC. vs. CECILE
GEPAYA-LIM,.

G.R. No. 218014 December 7, 2016

Facts:

On 29 October 2004, Cartel was driving a bus, operated by Yellow

Bus Line, which was on its way from Marbel, Koronadal to Davao
City. At around 9:45 in the evening, as the bus was traversing
Crossing Rubber in the Municipality of Tupi, South Cotabato, Cortel
noticed two trucks with glaring headlights coming from the opposite
direction. Cortel stated that he was driving at a speed of 40 to 50
kilometers per hour. He claimed that upon noticing the trucks, he
reduced his speed to 20 kilometers per hour. However, the bus hit a
black motorcycle which allegedly had no tail light reflectors. The
impact dragged the motorcycle at a distance of three meters before it
came to a full stop. Lim, who was riding the motorcycle, was thrown
upward and then slammed into the bus, hitting the base of its right
windshield wiper. The motorcycle got entangled with the broken
bumper of the bus.

Felix Larang (Larang), the bus conductor, alighted from the bus to aid
Lim. Larang gave instructions to Cortel to move back to release Lim
and the motorcycle from the front bumper of the bus. Two bystanders
proceeded to the scene to assist Lim. After reversing the bus and
freeing Lim and the motorcycle, Cortel drove the bus away and went
to a nearby bus station where he surrendered to authorities. Cortel
claimed that he left the scene of the incident because he feared for his
life.

Respondent Cecile Gepaya-Lim, Lim's widow, filed a complaint for

damages against petitioners. RTC held Cortel liable and the Court of
Appeals applied the doctrine of res ipsa loquitor.

Issue:

Whether the Court of Appeals committed a reversible error m

affirming with modifications the decision of the trial court.

Ruling:

We agree that res ipsa loquitur applies m this case. The Court

explained this doctrine as follows:
While negligence is not ordinarily inferred or presumed, and while
the mere happening of an accident or injury will not generally give
rise to an inference or presumption that it was due to negligence on
defendant's part, under the doctrine of res ipsa loquitur, which
means, literally, the thing or transaction speaks for itself, or in one
jurisdiction, that the thing or instrumentality speaks for itself, the
facts or circumstances accompanying an injury may be such as to
raise a presumption, or at least permit an inference of negligence on
the part of the defendant, or some other person who is charged with
negligence.

x x x [W]here it is shown that the thing or instrumentality which

caused the injury complained of was under the control or
management of the defendant, and that the occurrence resulting in
the injury was such as in the ordinary course of things would not
happen if those who had its control or management used proper care,
there is sufficient evidence, or, as sometimes stated, reasonable
evidence, in the absence of explanation by the defendant, that the
injury arose from or was caused by the defendant's want of care.

x x x x

The res ipsa loquitur doctrine is based in part upon the theory that

the defendant in charge of the instrumentality which causes the injury
either knows the cause of the accident or has the best opportunity of
ascertaining it and that the plaintiff has no such knowledge, and
therefore is compelled to allege negligence in general terms and to
rely upon the proof of the happening of the accident in order to
establish negligence. The inference which the doctrine permits is
grounded upon the fact that the chief evidence of the true cause,
whether culpable or innocent, is practically accessible to the
defendant but inaccessible to the injured person
The elements of res ipsa loquitur are: (1) the accident is of such
character as to warrant an inference that it would not have happened
except for the defendant's negligence; (2) the accident must have
been caused by an agency or instrumentality within the exclusive
management or control of the person charged with the negligence
complained of; and (3) the accident must not have been due to any
voluntary action or contribution on the part of the person injured.

Vicarious Liability

Jose G. Tan and Orencio C. Luzuriaga vs. Romeo H. Valeriano

G.R. No. 185559 August 16, 2017

Facts:

It is undisputed that on 4 January 2001, the Holy Name Society of

Bulan, Sorsogon (Holy Name Society), held a multi-sectoral
consultative conference at the Bulan Parish Compound. Valeriano,
the president of the religious organization, delivered a welcome
address during the conference. In his address, Valeriano allegedly
lambasted certain local officials of Bulan, Sorsogon, specifically
Municipal Councilors petitioners, Gilana and Vice-Mayor Gonzales.

The following day, or on 5 January 2001, petitioners, together with

Gilana and Gonzales, filed before the Civil Service Commission (CSC)
an administrative complaint against Valeriano who was an incumbent
resident auditor of the Commission on Audit (COA). The COA was
furnished with a copy of the administrative complaint against
Valeriano. The COA, however, did not take any action on the
complaint in view of the pendency of the case before the CSC.

The petitioners and Gilana filed on 22 March 2001 another

administrative complaint dated 13 March 2001 before the Office of
the Ombudsman, this time for violation of Republic Act No. 6713, in
relation to Section 55 of the Revised Administrative Code of 1987.
This complaint was dismissed by the Ombudsman on 21 June 2001
for want of evidence.

After weighing the evidence, the RTC ruled that the act of filing of
numerous cases against Valeriano by petitioners, Gilana, and
Gonzales was attended by malice, vindictiveness, and bad faith. In the
assailed decision, the CA reversed the trial court's ruling insofar as
Gonzales and Gilana were concerned, but affirmed that petitioners
should be held liable for damages.

Issue:

The pivotal issue in this case is whether petitioners acted with malice
or bad faith in filing the administrative complaints against Valeriano.

Ruling:

We rule in the negative.

Indeed, the CA, in absolving Gonzales and Gilana, found no malice or

bad faith in the first complaint with the CSC, to wit:

Defendants-appellants miserably failed to show that plaintiff-appellee

Valeriano probably engaged in partisan political activity when the
latter urged the participants in his welcome address "to join hands
together to build and offer our constituents a good governance as
alternative of which, I will leave it to your noble hands." Witness for
defendants-appellants Asotes did not even see and hear plaintiff-
appellee Valeriano deliver his welcome address.

However, there is no showing that defendants-appellants

Gonzales and Gilana acted with malice or sinister design to
vex or humiliate plaintiff-appellee Valeriano by the mere
act of initiating an administrative case for electioneering
against the latter with the CSC and with the Office of the Ombudsman
after the dismissal without prejudice of the complaint by the
CSC. (emphasis supplied)
This Court, however, disagrees with the CA that the mere re-filing of
the complaint with the CSC is reason to hold petitioners liable for
damages. It must be remembered that the same complaint had earlier
been dismissed on a technicality, and that the CSC directed that the
dismissal was without prejudice, i.e., the complaint may be re-filed
after compliance with the technical rules. Following the discussion of
the CA as quoted above, we can say that this same complaint was
likewise not filed out of malice. It was borne out of a reasonable belief
on the illegality of Valeriano's acts. Parenthetically, whether
Valeriano's acts do amount to illegalities is another question
altogether, one that is not within the purview of the present review.

It is a doctrine well-entrenched in jurisprudence that the mere act of

submitting a case to the authorities for prosecution, of and by itself,
does not make one liable for malicious prosecution, for the law could
not have meant to impose a penalty on the right to litigate.

TORTS AND DAMAGES

 Petition for Review on Certiorari

Our Lady of Lourdes Hospital vs. Sps. Romeo and Regina Capanzana
G.R. No. 189218  March 22, 2017

Facts:

Regina Capanzana (Regina), a 40-year-old nurse and clinical instructor pregnant

with her third child, was scheduled for her third caesarean section (C-section) on
2 January 1998. However, a week earlier, on 26 December 1997, she went into
active labor and was brought to petitioner hospital for an emergency C-section.
She first underwent a pre-operative physical examination by Dr. Miriam
Ramos (Dr. Ramos) and Dr. Milagros Joyce Santos, (Dr. Santos) the same
attending physicians in her prior childbirths. She was found fit for anesthesia
after she responded negatively to questions about tuberculosis, rheumatic fever,
and cardiac diseases. On that same day, she gave birth to a baby boy. 
At 2:30 a.m. the following day, or 13 hours after her operation, Regina who was
then under watch by her niece, Katherine L. Balad (Balad), complained of a
headache, a chilly sensation, restlessness, and shortness of breath. She asked for
oxygen and later became cyanotic. After undergoing an x-ray, she was found to be
suffering from pulmonary edema.

when her condition still showed no improvement, Regina was transferred to the
Cardinal Santos Hospital. The doctors thereat found that she was suffering from
rheumatic heart disease mitral stenosis with mild pulmonary hypertension,
which contributed to the onset of fluid in her lung tissue (pulmonary edema).
This development resulted in cardio-pulmonary arrest and, subsequently, brain
damage. Regina lost the use of her speech, eyesight, hearing and limbs. She was
discharged, still in a vegetative state, on 19 January 1998.

Respondent spouses Capanzana filed a complaint for damages against petitioner

hospital, along with co-defendants: Dr. Miriam Ramos, an
obstetrician/gynecologist; Dr. Milagros Joyce Santos, an anesthesiologist; and
Jane Does, the nurses on duty stationed on the second floor of petitioner hospital
on 26-27 December 1997.

Respondents imputed negligence to Drs. Ramos and Santos for the latter's failure
to detect the heart disease of Regina, resulting in failure not only to refer her to a
cardiologist for cardiac clearance, but also to provide the appropriate medical
management before, during, and after the operation. They further stated that the
nurses were negligent for not having promptly given oxygen, and that the
hospital was equally negligent for not making available and accessible the oxygen
unit on that same hospital floor at the time.

Issue:
Whether or not petitioner is directly liable for damages for the negligence of its
nurses

Ruling:

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

In the instant case, there is no dispute that petitioner was the

employer of the nurses who have been found to be negligent in the
performance of their duties. This fact has never been in issue. Hence,
petitioner had the burden of showing that it exercised the diligence of
a good father of a family not only in the selection of the negligent
nurses, but also in their supervision.

We therefore affirm the appellate court in finding petitioner directly

liable for the negligence of its nurses under Article 2180 in relation to
Article 2176 of the Civil Code.

Petition for Review on Certiorari

SPOUSES ESTRADA VS. PHILIPPINE RABBIT BUS LINES

G.R. NO. 203902 JULY 19, 2017

Facts:

On April 13, 2004, petitioners filed with the Regional Trial Court
(RTC) of Urdaneta City, Pangasinan, a Complaint[5] for Damages
against Philippine Rabbit and respondent Eduardo R. Saylan.
[A] mishap occurred on April 9, 2002 along the national highway in
Barangay Alipangpang, Pozorrubio, Pangasinan, between the
passenger bus with plate number CVK-964 and body number 3101,
driven by [respondent] Eduardo Saylan and owned by [respondent]
Philippine Rabbit Bus, Lines, Inc., and the Isuzu truck with plate
number UPB-974 driven by Willy U. Urez and registered in the name
of Rogelio Cuyton, Jr.
Dionisio argued that pursuant to the contract of carriage between him
and Philippine Rabbit, respondents were duty-bound to carry him
safely as far as human care and foresight can provide, with utmost
diligence of a very cautious person, and with due regard for all the
circumstances from the point of his origin in Urdaneta City to his
destination in Pugo, La Union. However, through the fault and
negligence of Philippine Rabbit's driver, Eduardo, and without
human care foresight, and due regard for all circumstances,
respondents failed to transport him safely by reason of the
aforementioned collision which resulted in the amputation of
Dionisio's right arm. And since demands for Philippine Rabbit to pay
him damages for the injury he sustained remained unheeded,
Dionisio filed the said complaint wherein he prayed for the following
awards: moral damages of P500,000, actual damages of P60,000.00,
and attorney's fees of P25,000.00.

RTC held Philippine Rabbit Bus Lines Inc., jointly and severally liable
with Eduardo for the awards made in favour of Dionisio. Accordingly,
the CA modified the RTC Decision in that it declared Philippine
Rabbit as solely and exclusively liable to Dionisio for actual damages
in the amount of P57,766.25 and deleted the award of moral damages
and attorney's fees.

Issue:
WHETHER OR NOT THE HONORABLE COURT OF APPEALS
ERRED IN DECLARING THAT THERE WAS NO EVIDENCE ON
RECORD INDICATIVE OF FRAUD OR BAD FAITH ON
[PHILIPPINE RABBIT'S] PART.

Ruling:
Moral damages; Instances
when moral damages can be
awarded in an action for
breach of contract.
Moral damages include physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded feelings, moral
shock, social humiliation, and similar injury. Though incapable of
pecuniary computation, moral damages may be recovered if they are
the proximate result of the defendant's wrongful act or omission.
Under Article 2219 of the Civil Code, moral damages are recoverable
in the following and analogous cases: (1) a criminal offense resulting
in physical injuries; (2) quasi-delicts causing physical injuries; (3)
seduction, abduction, rape or other lascivious acts; (4) adultery or
concubinage; (5) illegal or arbitrary detention or arrest; (6) illegal
search; (7) libel, slander, or any other form of defamation; (8)
malicious prosecution; (9) acts mentioned in Article 309; and (1) acts
and actions referred to in Articles 21, 26,27, 28, 29,30, 32, 34,and 35.
x x x [C]ase law establishes the following requisites for the award of
moral damages: (1) there must be an injury clearly sustained by the
claimant, whether physical, mental or psychological; (2) there must
be a culpable act or omission factually established; (3) the wrongful
act or omission of the defendant is the proximate cause of the injury
sustained by the claimant; and (4) the award for damages is
predicated on any of the cases stated in Article 2219 of the Civil Code.
Since breach of contract is not one of the items enumerated under
Article 2219, moral damages, as a general rule, are not recoverable in
actions for damages predicated on breach of contract.
x x x As an exception, such damages are recoverable [in an action for
breach of contract:] (1) in cases in which the mishap results in the
death of a passenger, as provided in Article 1764, in relation to Article
2206(3) of the Civil Code; and (2) in x x x cases in which the carrier is
guilty of fraud or bad faith, as provided in Article 2220.

There is no showing here that Philippine Rabbit induced Dionisio to

enter into a contract of carriage with the former through insidious
machination. Neither is there any indication or even an allegation of
deceit or concealment or omission of material facts by reason of
which Dionisio boarded the bus owned by Philippine Rabbit.
Likewise, it was not shown that Philippine Rabbit's breach of its
known duty, which was to transport Dionisio from Urdaneta to La
Union, was attended by some motive, interest, or ill will. From these,
no fraud or bad faith can be attributed to Philippine Rabbit.