FIRST DIVISION

[G.R. No. 132266. December 21, 1999]

CASTILEX INDUSTRIAL CORPORATION, petitioner, vs. VICENTE VASQUEZ, JR. and LUISA SO
VASQUEZ, and CEBU DOCTORS HOSPITAL, INC., respondents.

DECISION
DAVIDE, JR., C.J.:

The pivotal issue in this petition is whether an employer may be held vicariously liable for the
death resulting from the negligent operation by a managerial employee of a company-issued vehicle.
The antecedents, as succinctly summarized by the Court of Appeals, are as follows:

On 28 August 1988, at around 1:30 to 2:00 in the morning, Romeo So Vasquez, was driving a Honda
motorcycle around Fuente Osmea Rotunda. He was traveling counter-clockwise, (the normal flow of
traffic in a rotunda) but without any protective helmet or goggles. He was also only carrying a
Students Permit to Drive at the time. Upon the other hand, Benjamin Abad [was a] manager of
Appellant Castilex Industrial Corporation, registered owner [of] a Toyota Hi-Lux Pick-up with plate no.
GBW-794. On the same date and time, Abad drove the said company car out of a parking lot but
instead of going around the Osmea rotunda he made a short cut against [the] flow of the traffic in
proceeding to his route to General Maxilom St. or to Belvic St.

In the process, the motorcycle of Vasquez and the pick-up of Abad collided with each other causing
severe injuries to the former. Abad stopped his vehicle and brought Vasquez to the Southern Islands
Hospital and later to the Cebu Doctors Hospital.

On September 5, 1988, Vasquez died at the Cebu Doctors Hospital. It was there that Abad signed an
acknowledgment of Responsible Party (Exhibit K) wherein he agreed to pay whatever hospital bills,
professional fees and other incidental charges Vasquez may incur.

After the police authorities had conducted the investigation of the accident, a Criminal Case was filed
against Abad but which was subsequently dismissed for failure to prosecute. So, the present action for
damages was commenced by Vicente Vasquez, Jr. and Luisa So Vasquez, parents of the deceased
Romeo So Vasquez, against Jose Benjamin Abad and Castilex Industrial Corporation. In the same
action, Cebu Doctors Hospital intervened to collect unpaid balance for the medical expense given to
Romeo So Vasquez.[1]

The trial court ruled in favor of private respondents Vicente and Luisa Vasquez and ordered Jose
Benjamin Abad (hereafter ABAD) and petitioner Castilex Industrial Corporation (hereafter CASTILEX)
to pay jointly and solidarily (1) Spouses Vasquez, the amounts of P8,000.00 for burial
expenses; P50,000.00 as moral damages; P10,000.00 as attorneys fees; and P778,752.00 for loss of
earning capacity; and (2) Cebu Doctors Hospital, the sum of P50,927.83 for unpaid medical and
hospital bills at 3% monthly interest from 27 July 1989 until fully paid, plus the costs of litigation. [2]
CASTILEX and ABAD separately appealed the decision.
In its decision[3] of 21 May 1997, the Court of Appeals affirmed the ruling of the trial court holding
ABAD and CASTILEX liable but held that the liability of the latter is only vicarious and not solidary with
the former. It reduced the award of damages representing loss of earning capacity from  P778,752.00
to P214,156.80; and the interest on the hospital and medical bills, from 3% per month to 12% per
annum from 5 September 1988 until fully paid.
Upon CASTILEXs motion for reconsideration, the Court of Appeals modified its decision by (1)
reducing the award of moral damages from P50,000 to P30,000 in view of the deceaseds contributory
negligence; (b) deleting the award of attorneys fees for lack of evidence; and (c) reducing the interest
on hospital and medical bills to 6% per annum from 5 September 1988 until fully paid. [4]
Hence, CASTILEX filed the instant petition contending that the Court of Appeals erred in (1)
applying to the case the fifth paragraph of Article 2180 of the Civil Code, instead of the fourth
paragraph thereof; (2) that as a managerial employee, ABAD was deemed to have been always acting
within the scope of his assigned task even outside office hours because he was using a vehicle issued
to him by petitioner; and (3) ruling that petitioner had the burden to prove that the employee was not
acting within the scope of his assigned task.
Jose Benjamin ABAD merely adopted the statement of facts of petitioner which holds fast on the
theory of negligence on the part of the deceased.
 On the other hand, respondents Spouses Vasquez argue that their sons death was caused by the
negligence of petitioners employee who was driving a vehicle issued by petitioner and who was on his
way home from overtime work for petitioner; and that petitioner is thus liable for the resulting injury
and subsequent death of their son on the basis of the fifth paragraph of Article 2180.  Even if the
fourth paragraph of Article 2180 were applied, petitioner cannot escape liability therefor.  They
moreover argue that the Court of Appeals erred in reducing the amount of compensatory damages
when the award made by the trial court was borne both by evidence adduced during the trial
regarding deceaseds wages and by jurisprudence on life expectancy. Moreover, they point out that the
petition is procedurally not acceptable on the following grounds: (1) lack of an explanation for serving
the petition upon the Court of Appeals by registered mail, as required under Section 11, Rule 13 of the
Rules of Civil Procedure; and (2) lack of a statement of the dates of the expiration of the original
reglementary period and of the filing of the motion for extension of time to file a petition for review.
For its part, respondent Cebu Doctors Hospital maintains that petitioner CASTILEX is indeed
vicariously liable for the injuries and subsequent death of Romeo Vasquez caused by ABAD, who was
on his way home from taking snacks after doing overtime work for petitioner. Although the incident
occurred when ABAD was not working anymore the inescapable fact remains that said employee would
not have been situated at such time and place had he not been required by petitioner to do overtime
work. Moreover, since petitioner adopted the evidence adduced by ABAD, it cannot, as the latters
employer, inveigle itself from the ambit of liability, and is thus estopped by the records of the case,
which it failed to refute.
We shall first address the issue raised by the private respondents regarding some alleged
procedural lapses in the petition.
Private respondents contention of petitioners violation of Section 11 of Rule 13 and Section 4 of
Rule 45 of the 1997 Rules of Civil Procedure holds no water.
Section 11 of Rule 13 provides:

SEC. 11. Priorities in modes of service and filing. -- Whenever practicable, the service and filing of
pleadings and other papers shall be done personally. Except with respect to papers emanating from
the court, a resort to other modes must be accompanied by a written explanation why the service or
filing was not done personally. A violation of this Rule may be cause to consider the paper as not filed.

The explanation why service of a copy of the petition upon the Court of Appeals was done by
registered mail is found on Page 28 of the petition. Thus, there has been compliance with the
aforequoted provision.
As regards the allegation of violation of the material data rule under Section 4 of Rule 45, the
same is unfounded. The material dates required to be stated in the petition are the following: (1) the
date of receipt of the judgment or final order or resolution subject of the petition; (2) the date of filing
of a motion for new trial or reconsideration, if any; and (3) the date of receipt of the notice of the
denial of the motion. Contrary to private respondents claim, the petition need not indicate the dates of
the expiration of the original reglementary period and the filing of a motion for extension of time to file
the petition. At any rate, aside from the material dates required under Section 4 of Rule 45, petitioner
CASTILEX also stated in the first page of the petition the date it filed the motion for extension of time
to file the petition.
Now on the merits of the case.
The negligence of ABAD is not an issue at this instance. Petitioner CASTILEX presumes said
negligence but claims that it is not vicariously liable for the injuries and subsequent death caused by
ABAD.
Petitioner contends that the fifth paragraph of Article 2180 of the Civil Code should only apply to
instances where the employer is not engaged in business or industry. Since it is engaged in the
business of manufacturing and selling furniture it is therefore not covered by said provision. Instead,
the fourth paragraph should apply.
Petitioners interpretation of the fifth paragraph is not accurate. The phrase even though the
former are not engaged in any business or industry found in the fifth paragraph should be interpreted
to mean that it is not necessary for the employer to be engaged in any business or industry to be
liable for the negligence of his employee who is acting within the scope of his assigned task. [5]
A distinction must be made between the two provisions to determine what is applicable. Both
provisions apply to employers: the fourth paragraph, to owners and managers of an establishment or
enterprise; and the fifth paragraph, to employers in general, whether or not engaged in any business
or industry. The fourth paragraph covers negligent acts of employees committed either in the service
of the branches or on the occasion of their functions, while the fifth paragraph encompasses negligent
acts of employees acting within the scope of their assigned task. The latter is an expansion of the
former in both employer coverage and acts included. Negligent acts of employees, whether or not the
employer is engaged in a business or industry, are covered so long as they were acting within the
scope of their assigned task, even though committed neither in the service of the branches nor on the
occasion of their functions. For, admittedly, employees oftentimes wear different hats. They perform
functions which are beyond their office, title or designation but which, nevertheless, are still within the
call of duty.
This court has applied the fifth paragraph to cases where the employer was engaged in a business
or industry such as truck operators [6] and banks.[7] The Court of Appeals cannot, therefore, be faulted
in applying the said paragraph of Article 2180 of the Civil Code to this case.
Under the fifth paragraph of Article 2180, whether or not engaged in any business or industry, an
employer is liable for the torts committed by employees within the scope of his assigned tasks.  But it is
necessary to establish the employer-employee relationship; once this is done, the plaintiff must show,
to hold the employer liable, that the employee was acting within the scope of his assigned task when
the tort complained of was committed. It is only then that the employer may find it necessary to
interpose the defense of due diligence in the selection and supervision of the employee. [8]
It is undisputed that ABAD was a Production Manager of petitioner CASTILEX at the time of the
tort occurrence. As to whether he was acting within the scope of his assigned task is a question of
fact, which the court a quo and the Court of Appeals resolved in the affirmative.
Well-entrenched in our jurisprudence is the rule that the factual findings of the Court of Appeals
are entitled to great respect, and even finality at times. This rule is, however, subject to exceptions
such as when the conclusion is grounded on speculations, surmises, or conjectures. [9] Such exception
obtain in the present case to warrant review by this Court of the finding of the Court of Appeals that
since ABAD was driving petitioners vehicle he was acting within the scope of his duties as a manager.
Before we pass upon the issue of whether ABAD was performing acts within the range of his
employment, we shall first take up the other reason invoked by the Court of Appeals in holding
petitioner CASTILEX vicariously liable for ABADs negligence, i.e., that the petitioner did not present
evidence that ABAD was not acting within the scope of his assigned tasks at the time of the motor
vehicle mishap. Contrary to the ruling of the Court of Appeals, it was not incumbent upon the
petitioner to prove the same. It was enough for petitioner CASTILEX to deny that ABAD was acting
within the scope of his duties; petitioner was not under obligation to prove this negative averment.  Ei
incumbit probatio qui dicit, non qui negat (He who asserts, not he who denies, must prove). The Court
has consistently applied the ancient rule that if the plaintiff, upon whom rests the burden of proving
his cause of action, fails to show in a satisfactory manner facts which he bases his claim, the
defendant is under no obligation to prove his exception or defense.[10]
Now on the issue of whether the private respondents have sufficiently established that ABAD was
acting within the scope of his assigned tasks.
ABAD, who was presented as a hostile witness, testified that at the time of the incident, he was
driving a company-issued vehicle, registered under the name of petitioner. He was then leaving the
restaurant where he had some snacks and had a chat with his friends after having done overtime work
for the petitioner.
No absolutely hard and fast rule can be stated which will furnish the complete answer to the
problem of whether at a given moment, an employee is engaged in his employers business in the
operation of a motor vehicle, so as to fix liability upon the employer because of the employees action
or inaction; but rather, the result varies with each state of facts. [11]
In Filamer Christian Institute v. Intermediate Appellate Court ,[12] this Court had the occasion to
hold that acts done within the scope of the employees assigned tasks includes any act done by an
employee in furtherance of the interests of the employer or for the account of the employer at the
time of the infliction of the injury or damages.
The court a quo and the Court of Appeals were one in holding that the driving by a manager of  a
company-issued vehicle is within the scope of his assigned tasks regardless of the time and
circumstances.
We do not agree. The mere fact that ABAD was using a service vehicle at the time of the injurious
incident is not of itself sufficient to charge petitioner with liability for the negligent operation of said
vehicle unless it appears that he was operating the vehicle within the course or scope of his
employment.
The following are principles in American Jurisprudence on the employers liability for the injuries
inflicted by the negligence of an employee in the use of an employers motor vehicle:

I. Operation of Employers Motor Vehicle in Going to or from Meals

 It has been held that an employee who uses his employers vehicle in going from his work to a
place where he intends to eat or in returning to work from a meal is not ordinarily acting within the
scope of his employment in the absence of evidence of some special business benefit to the
employer. Evidence that by using the employers vehicle to go to and from meals, an employee is
enabled to reduce his time-off and so devote more time to the performance of his duties supports the
finding that an employee is acting within the scope of his employment while so driving the vehicle. [13]

II. Operation of Employers Vehicle in Going to or from Work

In the same vein, traveling to and from the place of work is ordinarily a personal problem or
concern of the employee, and not a part of his services to his employer. Hence, in the absence of
some special benefit to the employer other than the mere performance of the services available at the
place where he is needed, the employee is not acting within the scope of his employment even though
he uses his employers motor vehicle.[14]
The employer may, however, be liable where he derives some special benefit from having the
employee drive home in the employers vehicle as when the employer benefits from having the
employee at work earlier and, presumably, spending more time at his actual duties. Where the
employees duties require him to circulate in a general area with no fixed place or hours of work, or to
go to and from his home to various outside places of work, and his employer furnishes him with a
vehicle to use in his work, the courts have frequently applied what has been called the special errand
or roving commission rule, under which it can be found that the employee continues in the service of
his employer until he actually reaches home. However, even if the employee be deemed to be acting
within the scope of his employment in going to or from work in his employers vehicle, the employer is
not liable for his negligence where at the time of the accident, the employee has left the direct route
to his work or back home and is pursuing a personal errand of his own.

III. Use of Employers Vehicle Outside Regular Working Hours

An employer who loans his motor vehicle to an employee for the latters personal use outside of
regular working hours is generally not liable for the employees negligent operation of the vehicle
during the period of permissive use, even where the employer contemplates that a regularly assigned
motor vehicle will be used by the employee for personal as well as business purposes and there is
some incidental benefit to the employer. Even where the employees personal purpose in using the
vehicle has been accomplished and he has started the return trip to his house where the vehicle is
normally kept, it has been held that he has not resumed his employment, and the employer is not
liable for the employees negligent operation of the vehicle during the return trip. [15]
The foregoing principles and jurisprudence are applicable in our jurisdiction albeit based on the
doctrine of respondeat superior, not on the principle of bonus pater familias as in ours. Whether the
fault or negligence of the employee is conclusive on his employer as in American law or jurisprudence,
or merely gives rise to the presumption   juris tantum of negligence on the part of the employer as in
ours, it is indispensable that the employee was acting in his employers business or within the scope of
his assigned task.[16]
In the case at bar, it is undisputed that ABAD did some overtime work at the petitioners office,
which was located in Cabangcalan, Mandaue City. Thereafter, he went to Goldies Restaurant in Fuente
Osmea, Cebu City, which is about seven kilometers away from petitioners place of business. [17] A
witness for the private respondents, a sidewalk vendor, testified that Fuente Osmea is a lively place
even at dawn because Goldies Restaurant and Back Street were still open and people were drinking
thereat. Moreover, prostitutes, pimps, and drug addicts littered the place. [18]
At the Goldies Restaurant, ABAD took some snacks and had a chat with friends. It was when
ABAD was leaving the restaurant that the incident in question occurred. That same witness for the
private respondents testified that at the time of the vehicular accident, ABAD was with a woman in his
car, who then shouted: Daddy, Daddy![19] This woman could not have been ABADs daughter, for ABAD
was only 29 years old at the time.
To the mind of this Court, ABAD was engaged in affairs of his own or was carrying out a personal
purpose not in line with his duties at the time he figured in a vehicular accident.  It was then about
2:00 a.m. of 28 August 1988, way beyond the normal working hours. ABADs working day had ended;
his overtime work had already been completed. His being at a place which, as petitioner put it, was
known as a haven for prostitutes, pimps, and drug pushers and addicts, had no connection to
petitioners business; neither had it any relation to his duties as a manager. Rather, using his service
vehicle even for personal purposes was a form of a fringe benefit or one of the perks attached to his
position.
Since there is paucity of evidence that ABAD was acting within the scope of the functions
entrusted to him, petitioner CASTILEX had no duty to show that it exercised the diligence of a good
father of a family in providing ABAD with a service vehicle. Thus, justice and equity require that
petitioner be relieved of vicarious liability for the consequences of the negligence of ABAD in driving its
vehicle.[20]
WHEREFORE, the petition is GRANTED, and the appealed decision and resolution of the Court of
Appeals is AFFIRMED with the modification that petitioner Castilex Industrial Corporation be absolved
of any liability for the damages caused by its employee, Jose Benjamin Abad.
SO ORDERED.
G.R. No. L-29759 May 18, 1989

NATIVIDAD DEL ROSARIO VDA. DE ALBERTO, in her individual capacity and as judicial guardian of the
minors ANTONIO ALBERTO, JR. and LOURDES ALBERTO, petitioners, 
vs.
THE HON. COURT OF APPEALS and ANTONIO J. ALBERTO, JR., assisted by his mother as his natural
guardian, ANDREA JONGCO, respondents.

Tañada, Carreon & Tañada for petitioners.

BIDIN, J.:

This is a petition for review on certiorari of the August 31, 1968 Decision of the Court of Appeals in CA-G.R. No.
34750-R'* entitled "Antonio J. Alberto, Jr., thru his mother as his natural guardian, Andrea Jongco, plaintiff-
appellant, vs. Natividad del Rosario Vda. de Alberto, in her individual capacity and as judicial guardian of the
minors, Lourdes Alberto and Antonio Alberto, Jr., defendants-appellees", reversing the August 10, 1964. Decision
of the then Court of First Instance of Manila.

The case originated from a complaint for acknowledgment and partition filed on September 8, 1960 with the then
Court of First Instance of Manila by the herein private respondent, a minor, 18 years of age, assisted by his
mother, Andrea Jongco, as his natural guardian, against the herein petitioners (Record on Appeal, pp. 2-8). In the
said Complaint, private respondent alleged, in substance, that in 1941 his alleged father, Antonio C. Alberto, and
his mother, Andrea Jongco, lived together as husband and wife and as a result of which, he was born on
September 10, 1942; that during the time that his alleged father and mother lived together as husband and wife
and up to the time of his birth, both were single and had no legal impediment to marry each other; that after his
birth, his father and mother continued living together as husband and wife, his father supporting them and
introducing him to the public as his natural child; that even the family of his father recognized him as such; that on
or about the year 1944, his father and mother separated, and subsequently, his father married herein petitioner
Natividad del Rosario; that as a result of the marriage, two (2) children were born herein petitioners Lourdes
Alberto and Antonio Alberto, Jr.; that although his father was separated from his mother, he continued to support
him and recognized him as his own child; that on July 3, 1949, his father died, and without notice to him,
petitioner Natividad del Rosario Vda. de Alberto, on July 17, 1949, instituted before the then Court of First
Instance of Manila an intestate proceedings for the estate of his deceased father, docketed therein as Special
Proceedings No. 9092; that in the said intestate proceedings, petitioners deliberately omitted him as one of the
heirs and for this reason they succeeded in having the properties of his deceased father adjudicated and
partitioned among themselves; that the said intestate proceedings were terminated on November 9, 1953; that
his father left properties valued at P74,963.81, and accordingly, as a natural child of his father, he is entitles to at
least P18,000.00; and that he had absolutely no previous knowledge of the intestate proceedings and came to
know about it only recently and thereupon made a demand from the petitioners who refused to give him his
share. Accordingly, he prays that the petitioners be ordered to acknowledge him as the natural child of Antonio C.
Alberto; that his one-fourth share be turned over to him; and that petitioners be sentenced to pay him the sum of
P5,000.00 as attorney's fee and the cost of suit (Record on Appeals, pp. 2-9).

On September 21, 1960, petitioners filed a Motion to Dismiss on the grounds that (1) the cause of action is
barred by prior judgment; and (2) that the cause of action is also barred by the statute of limitation (Ibid, pp. 9-
19). To this motion, private respondents filed an opposition on October 22, 1960 (Ibid, pp. 20-58).

On November 11, 1960, the trial court issued an Order denying the Motion to Dismiss (Ibid, pp. 97-98).

On November 18, 1964, petitioners filed their Answer to the Complaint (Ibid, pp. 98-102).

On November 23, 1964, private respondent filed his Answer to Defendants' counterclaim (Ibid, pp. 102-104). On
August 10, 1964, the trial court rendered a decision in favor of the petitioners (Ibid, pp. 104- 123). The dispositive
portion of the Decision reads:

Considering all the foregoing, the Court orders the dismissal of the complaint without
pronouncement as to the costs. The counterclaim is also dismissed.

SO ORDERED.

Private respondent, not satisfied with the decision, appealed to respondent Court, and in a Decision promulgated
on August 31, 1968 (Ibid, pp. 61-75), respondent Court reversed the decision of the trial court. The dispositive
portion of the said Decision, reads:

Wherefore, the decision appealed from is hereby reversed and set aside and another rendered
declaring plaintiff Antonio J. Alberto, Jr., an acknowledged Natural Child of the deceased Antonio
C. Alberto; declaring said plaintiff the owner pro indiviso of one-fifth (1/5) of the hereditary estate
of Antonio C. Alberto; and ordering the defendants to deliver to plaintiff Antonio J. Alberto, Jr., his
one-fifth (1/5) share in said estate, subject to the usufructuary rights of defendants Natividad del
 Rosario Vda. de Alberto pursuant to Articles 834 of the Old Civil Code, and to pay the costs of
suit.

SO ORDERED.

On September 24, 1968, petitioners filed a Motion for Reconsideration, but the same was denied in a Resolution
dated October 14, 1968 (Rollo, p. 77). Hence, the instant petition.

This Court, in a resolution dated November 27,1968, resolved to give due course to the petition (Rollo, p. 91).

Petitioners assigned the following errors:

I
THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE COURT OF FIRST INSTANCE OF MANILA
(TRIAL COURT) HAD NO JURISDICTION TO TAKE COGNIZANCE OF THE INSTANT CASE.

II
ASSUMING, ARGUENDO, THAT THE TRIAL COURT HAD JURISDICTION TO TAKE COGNIZANCE OF THE INSTANT CASE,
THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT RESPONDENT ALBERTO JR.'S CAUSE OF ACTION WAS
NOT BARRED BY PRIOR JUDGMENT.

III
ASSUMING, ARGUENDO, THAT THE TRIAL COURT HAD JURISDICTION TO TAKE COGNIZANCE OF THE INSTANT CASE,
THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT RESPONDENT ALBERTO JR.'S CAUSE OF ACTION HAD
NOT YET PRESCRIBED.

IV
ASSUMING, ARGUENDO, THAT THE TRIAL COURT HAD JURISDICTION TO TAKE COGNIZANCE OF THE INSTANT CASE,
THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING THAT RESPONDENT ALBERTO, JR., IN NOT BRINGING
THE INSTANT ACTION FOR AN UNREASONABLE LENGTH OF TIME, WAS GUILTY OF LACHES.

V
ASSUMING, ARGUENDO, THAT THE TRIAL COURT HAD JURISDICTION TO TAKE COGNIZANCE OF THE INSTANT CASE,
THE HONORABLE COURT OF APPEALS GROSSLY ERRED IN REVERSING THE FINDINGS OF THE TRIAL COURT BY BASING
ITS JUDGMENT ON A MISAPPREHENSION OF FACTS, GIVING CREDENCE TO THE TESTIMONIES OF ANDREA JONGCO
AND OTHER WITNESSES OF RESPONDENT ALBERTO, JR., DESPITE THE SERIOUS CONTRADICTIONS, INCONSISTENCIES
AND IMPROBABILITIES IN THEIR TESTIMONIES AS FOUND BY THE TRIAL COURT AND CATEGORICALLY STATED IN ITS
DECISION.

VI
ASSUMING, ARGUENDO, THAT THE TRIAL COURT HAD JURISDICTION TO TAKE COGNIZANCE OF THE INSTANT CASE,
THE HONORABLE COURT OF APPEALS COMMITTED A GROSS ERROR OF LAW AND A GRAVE ABUSE OF DISCRETION
WHEN IT ARBITRARILY AND CAPRICIOUSLY DISREGARDED PETITIONERS' EVIDENCE.

VII
ASSUMING, ARGUENDO, THAT THE TRIAL COURT HAD JURISDICTION TO TAKE COGNIZANCE OF THE INSTANT CASE,
THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT RESPONDENT ALBERTO, JR., WAS AN
ACKNOWLEDGED NATURAL CHILD OF THE DECEASED ALBERTO AND IN DECLARING HIM OWNER PRO-INDIVISO OF
ONE-FIFTH OF THE HEREDITARY ESTATE OF THE DECEASED.

I.

It is the contention of petitioners that inasmuch as the instant case was filed on September 8, 1960, almost five
(5) years after the enactment of R.A. No. 1401 — creating the Juvenile and Domestic Relations Court, the
questions of paternity and acknowledgment fall beyond the jurisdictional pale of the Court of First Instance of
Manila and instead comes within the exclusive original jurisdiction of the Juvenile and Domestic Relations Court.
While petitioners admitted that this objection to lack of jurisdiction by the Court of First Instance of Manila over
the subject matter of the present action had not been raised either in the said court or in the Court of Appeals and
is brought to this Court for resolution for the first time on appeal, they contend that a party may object to the
jurisdiction of the court over the subject matter of the action at any stage of the proceedings, even for the first
time on appeal since lack of jurisdiction of the court over the subject matter cannot be waived. Such contention is
untenable.

This Court has already ruled that the question of jurisdiction not raised in the trial court cannot be raised on
appeal (Dalman vs. City Court of Dipolog City, Branch II, 134 SCRA 243 [1985]). Besides, a party who had
voluntarily participated in the trial, like the herein petitioners, cannot later on raise the issue of the court's lack of
jurisdiction (Philippine National Bank vs. Intermediate Appellate Court, 143 SCRA 299 [1986]; Royales vs.
Intermediate Appellate Court, 143 SCRA 470 [1984]; Tijam vs. Sibonghanoy, 23 SCRA 29 [1968]). Moreover,
there are no more Juvenile and Domestic Relations Courts today. Under Batas Pambansa Blg. 129, the functions
of the Juvenile and Domestic Relations Court have been transferred to the Regional Trial Courts (Divinagracia
vs. Bellosillo, 143 SCRA 356 [1986]).

II.

Petitioners alleged that the intestate proceedings for the settlement of estate of the deceased Antonio C. Alberto
(Special Proceedings No. 9092) had already been terminated on November 9, 1953 by the order of distribution
directing the delivery of the residue of the estate to the persons entitled thereto and that in said proceedings the
court also declared who are the heirs of the deceased. Consequently, the instant case which seeks to secure the
recognition of Antonio J. Alberto, Jr. as an acknowledged natural child of the deceased in order to establish his
rights to the inheritance is already barred by prior judgment (Petitioners' Brief, p. 47) despite private respondent's
insistence that he had no knowledge or notice of the intestate proceedings of his alleged natural father (Record
on Appeal, p. 21).

Petitioners' submission is impressed with merit.

This Court has invariably ruled that insolvency proceedings and settlement of a decedent's estate are both
proceedings in rem which are binding against the whole world. All persons having interest in the subject matter
involved, whether they were notified or not, are equally bound (Philippine Savings Bank vs. Lantin, 124 SCRA
483 [1983]). The court acquires jurisdiction over all persons interested, through the publication of the notice
prescribed ... and any order that may be entered therein is binding against all of them (Ramon vs. Ortuzar, 89
Phil. 741 [1951] citing in re Estate of Johnson, 39 Phil. 156). It was ruled further that a final order of distribution of
the estate of a deceased person vests the title to the land of the estate in the distributees; and that the only
instance where a party interested in a probate proceeding may have a final liquidation set aside is when he is left
out by reason of circumstances beyond his control or through mistake or inadvertence not imputable to
negligence. Even then, the better practice to secure relief is reopening of the same case by proper motion within
the reglementary period, instead of an independent action, the effect of which, if successful, would be, as in the
instant case, for another court or judge to throw out a decision or order already final and executed and reshuffle
properties long ago distributed and disposed of (Ramon vs. Ortuzar, supra; Santos vs. Roman Catholic Bishop of
Nueva Caceres 45 Phil. 895).

III.

As to the issue of prescription, the Civil Code of the Philippines clearly provides:

Art. 1100. The action for rescission on account of lesion shall prescribe after four years from the
time the partition was made.

Intestate proceedings were terminated as alleged in the complaint itself on November 9, 1953 so that said four
years prescriptive period expired on November 9,1957. Hence, the present action filed on September 8, 1960
and which has for one of its objects the rescission of the agreement of partition among the petitioners, as
approved by the intestate court, is already barred by prescription.

That an action for rescission is also the proper action in case of an alleged preterition of a compulsory heir by
reason of alleged bad faith or fraud of the other persons interested, which is what the complaint in this case
alleges in substance, is indicated in Article 1104 of the Civil Code as follows:

Art. 1104. A partition made with preterition of any of the compulsory heirs shall not be rescinded,
unless it be proved that there was bad faith or fraud on the part of the other persons interested; ...

It has also been ruled by this Court that the four years period provided in Article 1100 of the Civil Code (formerly
Art. 1076 of the old Civil Code) should commence to run from the approval of the agreement of partition by the
Court (Samson vs. Araneta, 60 Phil. 27, 36). Thus, in the case at bar, it is evident that the action to rescind the
Agreement of Partition which was approved by the Court on November 9, 1953, had already prescribed when
respondent filed the complaint in the case at bar on September 8, 1960.

While as a general rule the action for partition among co-owners does not prescribe so long as the co-ownership
is expressly or impliedly recognized (Art. 494, Civil Code), petitioners herein had never recognized respondent as
a co-owner or co-heir either expressly or impliedly. Consequently, the rule on non-prescription of action for
partition of property owned in common (Art. 494) does not apply to the case at bar.

Moreover, private respondent cannot claim exemption from the effects of prescription on the plea of minority
under the New Civil Code which provides:

Art. 1108. Prescription, both acquisitive and extinctive, runs against: (1) Minors and other
incapacitated persons who have parents, guardians or other legal representatives:

xxxxxxxxx
Respondent Alberto, Jr. who has a living parent, his mother, Andrea Jongco, who in fact filed the complaint in the
case at bar for him, falls squarely under the above-cited provision.

Granting arguendo that respondent is a natural child of the deceased Antonio Alberto, Sr., the action for
recognition of natural child may be brought only during the lifetime of the presumed parent. And if the presumed
father or mother died during the minority of the child, the latter may file the action within four (4) years from the
attainment of majority (Art. 285 [1]). However, if the minor has a guardian as in this case, prescription runs
against him even during minority (Wenzel etc., et al. vs. Surigao Consolidated Mining, Inc., 108 Phil. 530 [1960]).
In such case, the action for recognition must be instituted within four (4) years after the death of the natural father
(Magallanes, et al. vs. Court of Appeals, et al., 95 Phil. 795 [1954]). Antonio C. Alberto, Sr., the alleged father,
died on July 3, 1949. The complaint for acknowledgment and partition was filed eleven (11) years later, on
September 8, 1960. Hence, prescription had set in.

Neither can it be claimed that the present action is in substance one for recovery of property in order to avoid the
consequences of prescription, for as correctly stated by the petitioners, to be entitled to the recovery of the
property from the estate, Alberto, Jr. must first rescind the partition and distribution approved by the intestate
proceedings, otherwise, the recovery of any property from the petitioners is not possible. Be that as it may, such
partition can no longer be rescinded having been already barred by the Statute of Limitations.

Furthermore, even granting that Article 1104 of the Civil Code does not apply and there is an injury to the rights
of plaintiff, tills action would still not prosper under Articles 1146 and 1149 of the same Code which provide that
the action must be brought within four and five years, respectively, from the time the right of action accrues.

IV

Petitioners' claim of laches is likewise tenable. The trial court in its findings clearly and unmistakably declared that
respondent Alberto, Jr. is guilty of laches as follows:

About 1944, Andrea Jongco said she learned of Antonio Alberto's marriage to Natividad del
Rosario. Yet, she took no steps to protect the interests of her child, Antonio, although she was
already confronted with the incontrovertible proof of Antonio's infidelity and the hallowness of his
promises.

It might be that Andrea Jongco was then relying on Antonio Alberto's not denying that Alberto, Jr.
was his child, if such was the case. If this was so, however, how can we explain her inaction even
after the death of Antonio Alberto in 1949, or until September 8, 1960, when she filed this action,
Andrea kept silent, took no action to have her child recognized as the son of the alleged father.
Her laches, as well as the inherent improbabilities in her testimony rendered it unworthy of belief.

... It is evident that the plaintiff's case is adversely affected by his long delay in bringing this
action. 'Undue delay in the separate enforcement of a right is strongly persuasive of lack of merit
in this claim, since it is human nature for a person to assert his rights most strongly when they are
threatened or invaded. (Buenaventura vs. David, 37 Phil. 435-440). (Record on Appeal, pp. 108-
109).

This Court has consistently declared that laches is the failure or neglect, for an unreasonable and unexplained
length of time, to do that which by exercising due diligence, could or should have been done earlier. The
negligence or omission to assert a right within a reasonable time, warrants a presumption that the party entitled
to assert it either has abandoned it or declined to assert it (Corro vs. Lising, 137 SCRA 541 [1985]; Tendo vs.
Zamacoma, 138 SCRA 78 [1985]; De Castro vs. Tan, 129 SCRA 85 [1984]; Medija vs. Patcho, 132 SCRA 540
[1984]; Burgos, Sr. vs. Chief of Staff, Armed Forces of the Phil., 133 SCRA 800 [1984]; Gumonpin vs. CA, 120
SCRA 687 [1983]).

As pointed out by the trial court, there appears to be no explanation for the surprising delay in the filing of the
complaint in the case at bar except perhaps, the fact that during the lifetime of the deceased Antonio Alberto,
private respondents were receiving support until the latter died in 1949; but thereafter, they allowed more than
ten years to elapse or until September 8, 1960 before they filed the present action to assert their rights despite
Andrea Jongco's allegation that they stopped receiving support after Alberto, Sr.'s death.

On the other hand, there is merit in petitioners' allegations that such delay is prejudicial to them. Private
respondents could have filed the action in 1944 when Andrea Jongco learned of the marriage of the deceased
with petitioner Natividad del Rosario instead of waiting for 16 years when the supposed father's lips had been
sealed by death and possible witnesses like Antonio Alberto, Sr.'s mother had become too old to give coherent
testimony.

On this point, the Supreme Court ruled:

The assertion of doubtful claims, after long delay, cannot be favored by the courts. Time inevitably
tends to obliterate occurrences from the memory of witnesses, and even where the recollection
appears to be entirely clear, the true clue to the solution of a case may be hopelessly lost. These
considerations constitute one of the pillars of the doctrine long familiar in equity jurisprudence to
 the effect that laches or unreasonable delay on the part of a plaintiff in seeking to enforce a right
is not only persuasive of a want of merit but may, according to the circumstances, be destructive
of the right itself. Vigilantibus non dormientibus equites subvenit (Buenaventura vs. David, 37
Phil. 435, reiterated in Edralin vs. Edralin, 1 SCRA 227 [1961]).

The other explanation might have been the minority of Antonio Alberto, Jr. at the time of his supposed father's
death. But such explanation as discussed earlier is unavailing even in case of prescription under Article 1108 of
the Civil Code where minority does not stop the running of the prescriptive period for minors who have parents,
guardians or legal representatives.

Thus, it is well established that "The law serves those who are vigilant and diligent and not those who sleep when
the law requires them to act (Cui and Joven vs. Henson, 51 Phil. 606, 610; Bacolod-Murcia Milling Co. vs.
Villaluz, Sept. 29, 1951, 90 Phil. 154)." The law does not encourage laches, indifference, negligence or
ignorance. On the contrary, for a party to deserve the considerations of the courts, he... must show that he is not
guilty of any of the aforesaid failings (Samson vs. Yateo, August 28,1958; 104 PMI. 378).

V.

Finally on the merits of this case, petitioners would have this Court review and reverse the conclusions of fact of
the Court of Appeals. As a general rule, this is a function this Court does not undertake. The established principle
is that the factual findings of the Court of Appeals are final and may not be reviewed on appeal to this Court;
except: (1) when the conclusion is grounded entirely on speculation, surmises and conjectures; (2) when the
inference is manifestly mistaken, absurd and impossible; (3) where there is grave abuse of discretion; (4) when
the judgment is based on a misapprehension of facts; (5) when the Court in making its findings went beyond the
issues of the case, and the same are contrary to the admissions of both the apellant and the appellee; (6) when
the findings of the Appellate Court are contrary to those of the trial court; (7) when the findings are without citation
of specific evidence on which they are based (Manlapaz vs. C.A., 147 SCRA 238-239 [1987]; Guita vs. C.A., 139
SCRA 576 [1985]; Sacay vs. Sandiganbayan, 147 SCRA 593 [1986]).

It is readily evident that this case falls within one of the recognized exceptions to the rule, specifically that the
findings of the Appellate Court are contrary to those of the trial court.

At the trial, the lower court in evaluating the evidence presented by the complainants is of the view that the
testimony alone of Andrea Jongco is sufficient to totally discredit not only her testimony but also her entire case.
Aside from being inherently improbable and the merit of her claim being adversely affected by her testimony and
her long delay in bringing action, her testimony is contradicted by the testimonies of Jose, Zoilo and Pilar who are
brothers and sister of the deceased Antonio Alberto and who have no pecuniary interest whatsoever in the
outcome of the controversy. They testified that during the period Andrea Jongco claimed that Antonio Alberto, Sr.
lived with her, the deceased in fact lived with his mother and brothers at the family residence except for his brief
stint with the army (Decision, Civil Case No. 44164; Record on appeal, pp. 111-112).

More than that, the trial court found among others, that Andrea Jongco has had five children (aside from her son
Antonio) with four different men. The assumption, therefore, is that she lived with at least four different men
without being married to any of them. Thus, the trial court aptly ruled that his propensity to promiscuous
relationship with different men, render it unjust to state with definiteness that any particular person is the father of
any one of her children." (Ibid, p. 121).

Other witnesses are Eufracia Cailan who allegedly took care of Antonio, the father, since the latter was a child
and then of Antonio, the alleged son, and Encarnacion Peralta, an alleged former lessor of Andrea Jongco and
Antonio Alberto. Their testimonies were, however, found by the trial court to be inherently improbable,
inconsistent with human experience and deliberately invented to conform with the testimony of Andrea Jongco
(Ibid, pp. 109-117).

On the other hand, the Court of Appeals in its decision gave more credence to the testimonies of Eufracia Cailan
and Encarnacion Peralta and declared that their testimonies have sufficiently established the fact that Antonio J.
Alberto, Jr. is the son of the late Antonio C. Alberto and Andrea Jongco which finds further proof in the birth
certificate and the baptismal certificate of Alberto, Jr. (Rollo, pp. 6-11).

In this connection, it must be stated that in the case of Reyes vs. Court of Appeals, 135 SCRA 439 (1985), this
Court, citing the cases of Bercilles vs. GSIS, 128 SCRA 53; People vs. Villeza, 127 SCRA 349; Cid vs.
Burnaman, 24 SCRA 434; Vudaurrazaga vs. C.A., 91 Phil. 492; and Capistrano vs. Gabino, 8 Phil. 135, ruled that
a birth certificate not signed by the alleged father therein indicated, like in the instant case, is not competent
evidence of paternity.

In casting doubt upon the credibility of petitioner Natividad's testimony, the Court of Appeals pointed out her
serious inconsistency on material points such as her claim that she was married to the deceased in 1941 and her
later admission in the answer that they were married in 1944.

The record shows, however, that both admissions were correct, the first marriage was a secret civil marriage
celebrated in Pililla, Rizal while the second was a religious ratification of the former. The lack of marriage
certificate as evidence was also considered by the Court of Appeals as an impairment of credibility despite a
certification to the effect that all pre-war records in the Municipality of Pililla, Rizal were destroyed during the last
war. Said Appellate Court is of the view that if they did plan to marry secretly at that time, they could have chosen
a city or municipality near Manila and that Pililla must have been chosen as the place of the supposed marriage
so that petitioners could have an apparent good reason for the non-presentation of the marriage certificate.

As aptly argued by the petitioners, such conclusion is purely conjectural. Besides petitioners' reasons for the
choice of that place, the celebration of the marriage was positively confirmed by Damaso Herrera, one of the
sponsors thereof.

In any event, it is a fundamental rule that conclusions and findings of fact by the trial court are entitled to great
weight on appeal and should not be disturbed unless for strong and cogent reasons because the trial court is in a
better position to examine real evidence, as well as to observe the demeanor of the witnesses while testifying in
the case (People vs. Pimentel, 147 SCRA 29, 30 [19871; People vs. Grefiel, 125 SCRA 108 [1983]; Chase vs.
Buencamino, 136 SCRA 381 [1985]; People vs. Fernandez, 124 SCRA 248 (1983]; Olangco vs. C.F.I. of Misamis
Oriental, 121 SCRA 338 [1983]; Minuchechi vs. C.A., 129 SCRA 479 [1984]).

After a careful review of the records and the evidence presented by the contending parties, no cogent reasons
could be found to justify the reversal of the findings of the trial court.

In view of the foregoing, there appears to be no need to discuss the last two assignments of errors.

WHEREFORE, the assailed decision of the Court of Appeals is hereby Reversed and the decision of the trial
court is Reinstated. No costs.

SO ORDERED.
 DIVISION
[ GR No. 82318, May 18, 1989 ]
GILBERTO M. DUAVIT v. CA +
DECISION
255 Phil. 470

GUTIERREZ, JR., J.:

This petition raises the sole issue of whether or not the owner of a private vehicle which
figured in an accident can be held liable under Article 2180 of the Civil Code when the said vehicle
was neither driven by an employee of the owner nor taken with the consent of the latter.
The facts are summarized in the contested decision, as follows:
"From the evidence adduced by the plaintiffs, consisting of the testimonies of
witnesses Virgilio Catuar, Antonio Sarmiento, Jr., Ruperto Catuar, Jr. and Norberto Bernarte it
appears that on July 28, 1971 plaintiffs Antonio Sarmiento, Sr. and Virgilio Catuar were aboard a
jeep with plate number 77-99-F-1-Manila, 1971, owned by plaintiff, Ruperto Catuar was driving the
said jeep on Ortigas Avenue, San Juan, Rizal; that plaintiff's jeep, at the time, was running
moderately at 20 to 35 kilometers per hour - and while approaching Roosevelt
Avenue, Virgilio Catuar slowed down; that suddenly, another jeep with plate number 99-97-F-J,
Manila 1971 driven by defendant Oscar Sabiniano hit and bumped plaintiff's jeep on the portion
near the left rear wheel, and as a result of the impact plaintiff's jeep fell on its right and skidded by
about 30 yards; that as a result plaintiff's jeep was damaged, particularly the windshield, the
differential, the part near the left rear wheel and the top cover of the jeep; that
plaintiff Virgilio Catuar was thrown to the middle of the road; his wrist was broken and he
sustained contusions on the head; that likewise plaintiff Antonio Sarmiento, Sr. was trapped inside
the fallen jeep, and one of his legs was fractured.
"Evidence also shows that the plaintiff Virgilio Catuar spent a total of P2,464.00 for repairs of the
jeep, as shown by the receipts of payment of labor and spare parts (Exhs. H to H-7).  Plaintiffs
likewise tried to prove that plaintiff Virgilio Catuar, immediately after the accident was taken to
Immaculate Concepcion Hospital, and then was transferred to the National Orthopedic Hospital;
that while plaintiff Catuar was not confined in the hospital, his wrist was in a plaster cast for a
period of one month, and the contusions on his head were under treatment for about two (2)
weeks; that for hospitalization, medicine and allied expenses, plaintiff Catuar spent P5,000.00.
"Evidence also shows that as a result of the incident, plaintiff Antonio Sarmiento, Sr. sustained
injuries on his leg; that at first, he was taken to the National Orthopedic Hospital (Exh. K), but later
he was confined at the Makati Medical Center from July 29, to August 29, 1971 and then from
September 15 to 25, 1971; that his leg was in a plaster cast for a period of eight (8) months; and that
for hospitalization and medical attendance, plaintiff Antonio Sarmiento, Sr. spent no less than
P13,785.25 as evidenced by receipts in his possession (Exhs. N to N-1).
"Proofs were adduced also to show that plaintiff Antonio Sarmiento, Sr. is employed as Assistant
Accountant of the Canlubang Sugar Estate with a salary of P1,200.00 a month; that as sideline, he
also works as accountant of United Haulers, Inc. with a salary of P500.00 a month; and that as a
result of this incident, plaintiff Sarmiento was unable to perform his normal work for a period of at
least 8 months.  On the other hand, evidence shows that the other plaintiff Virgilio Catuar is a Chief
Clerk in Canlubang Sugar Estate with a salary of P500.00 a month, and as a result of the incident,
he was incapacitated to work for a period of one (1) month.
"The plaintiffs have filed this case both against Oscar Sabiniano as driver, and
against Gualberto Duavit as owner of the jeep.
"Defendant Gualberto Duavit, while admitting ownership of the other jeep (Plate No. 99-07-F-J
Manila, 1971), denied that the other defendant (Oscar Sabiniano) was his
employee.  Duavit claimed that he has not been an employer of defendant Oscar Sabiniano at
anytime up to the present.
"On the other hand documentary and testimonial evidence show that defendant
Oscar Sabiniano was an employee of the Board of Liquidators from November 14, 1966 up to
January 4, 1973 (Annex A of Answer).
"Defendant Sabiniano, in his testimony, categorically admitted that he took the jeep from the
garage of defendant Duavit without the consent or authority of the latter (TSN, September 7, 1978,
p. 8).  He tesfitied further, that Duavit even filed charges against him for theft of the jeep, but
which Duavit did not push through as his (Sabiniano's) parents apologized to Duavit on his behalf.
"Defendant Oscar Sabiniano, on the other hand in an attempt to exculpate himself from liability,
makes it appear that he was taking all necessary precaution while driving and the accident occurred
due to the negligence of Virgilio Catuar.  Sabiniano claims that it was plaintiff's vehicle which hit
and bumped their jeep." (Rollo, pp. 21-23)
The trial court found Oscar Sabiniano negligent in driving the vehicle but found no employer-
employee relationship between him and the petitioner because the latter was then a government
employee and he took the vehicle without the authority and consent of the owner. The petitioner
was, thus, absolved from liability under Article 2180 of the Civil Code.
The private respondents appealed the case.
On January 7, 1988, the Court of Appeals rendered the questioned decision holding the petitioner
jointly and severally liable with Sabiniano.  The appellate court in part ruled:
"We cannot go along with appellee's argument.  It will be seen that in Vargas v. Langcay, supra, it
was held that it is immaterial whether or not the driver was actually employed by the operator of
record or registered owner, and it is even not necessary to prove who the actual owner of the vehicle
and who the employer of the driver is.  When the Supreme Court ruled, thus:  'We must hold and
consider such owner-operator of record (registered owner) as the employer in contemplation of
law, of the driver,' it cannot be construed other than that the registered owner is the employer of
the driver in contemplation of law.  It is a conclusive presumption of fact and law, and is not subject
to rebuttal of proof to the contrary.  Otherwise, as stated in the decision, we quote:
"'The purpose of the principles evolved by the decisions in these matters will be defeated and
thwarted if we entertain the argument of petitioner that she is not liable because the actual owner
and employer was established by the evidence.  xxx.'"
Along the same vein, the defendant-appellee Gualberto Duavit cannot be allowed to prove that the
driver Sabiniano was not his employee at the time of the vehicular accident.
"The ruling laid down in Amar v. Soberano (1966), 63 O.G. 6850, by this Court to the effect that the
burden of proving the non-existence of an employer-employee relationship is upon the defendant
and this he must do by a satisfactory preponderance of evidence, has to defer to the doctrines
evolved by the Supreme Court in cases of damages arising from vehicular mishaps involving
registered motor vehicle.  (See Tugade v. Court of Appeals, 85 SCRA 226, 230).  (Rollo, pp. 26-27)
The appellate court also denied the petitioner's motion for reconsideration.  Hence, this petition.
The petitioner contends that the respondent appellate court committed grave abuse of discretion in
holding him jointly and severally liable with Sabiniano in spite of the absence of an employer-
employee relationship between them and despite the fact that the petitioner's jeep was taken out of
his garage and was driven by Sabiniano without his consent.
As early as in 1939, we have ruled that an owner of a vehicle cannot be held liable for an accident
involving the said vehicle if the same was driven without his consent or knowledge and by a person
not employed by him.  Thus, in Duquillo v. Bayot (67 Phil. 131-133-134) [1939]we said:
"Under the facts established, the defendant cannot be held liable for anything.  At the time of the
accident, James McGurk was driving the truck, and he was not an employee of the defendant, nor
did he have anything to do with the latter's business; neither the defendant nor Father Ayson, who
was in charge of her business, consented to have any of her trucks driven on the day of the accident,
as it was a holy day, and much less by a chauffeur who was not in charge of driving it; the use of the
defendant's truck in the circumstances indicated was done without her consent or knowledge; it
may, therefore, be said, that there was not the remotest contractual relation
between the deceased Pio Duquillo and the defendant.  It necessarily follows from all this that
articles 1101 and following of the Civil Code, cited by the appellant, have no application in this case,
and, therefore, the errors attributed to the inferior court are without basis."
The Court upholds the above ruling as still relevant and better applicable to present day
circumstances.
The respondent court's misplaced reliance on the cases of Erezo v. Jepte (102 Phil.
103 [1957] and Vargas v. Langcay (6 SCRA 174 [1962]) cannot be sustained.  In
the Erezo case, Jepte, the registered owner of the truck which collided with a taxicab, and which
resulted in the killing of Erezo, claimed that at the time of the accident, the truck belonged to the
Port Brokerage in an arrangement with the corporation but the same was not known to the Motor
Vehicles Office.  This Court sustained the trial court's ruling that since Jepte represented himself to
be the owner of the truck and the Motor Vehicles Office, relying on his representation, registered
the vehicle in his name, the Government and all persons affected by the representation had the
right to rely on his declaration of ownership and registration.  Thus, even if Jepte were not the
owner of the truck at the time of the accident, he was still held liable for the death
of Erezo.  Significantly, the driver of the truck was fully authorized to drive it.
Likewise, in the Vargas case, just before the accident occurred, Vargas had sold her jeepney to a
third person, so that at the time of the accident she was no longer the owner of the jeepney.  This
court, nevertheless, affirmed Vargas' liability since she failed to surrender to the Motor Vehicles
Office the corresponding AC plates in violation of the Revised Motor Vehicle Law and
Commonwealth Act No. 146.  We further ruled that the operator of record continues to be the
operator of the vehicle in contemplation of law, as regards the public and third persons, and as
such is responsible for the consequences incident to its operator.  The vehicle involved was a public
utility jeepney for hire.  In such cases, the law does not only require the surrender of the AC plates
but orders the vendor operator to stop the operation of the jeepney as a form of public
transportation until the matter is reported to the authorities.
As can be seen, the circumstances of the above cases are entirely different from those in the present
case.  Herein petitioner does not deny ownership of the vehicle involved in the mishap but
completely denies having employed the driver Sabiniano or even having authorized the latter to
drive his jeep.  The jeep was virtually stolen from the petitioner's garage.  To hold, therefore, the
petitioner liable for the accident caused by the negligence of Sabiniano who was neither his driver
nor employee would be absurd as it would be like holding liable the owner of a stolen vehicle for an
accident caused by the person who stole such vehicle.  In this regard, we cannot ignore the many
cases of vehicles forcibly taken from their owners at gunpoint or stolen from garages and parking
areas and the instances of service station attendants or mechanics of auto repair shops using,
without the owner's consent, vehicles entrusted to them for servicing or repair.
We cannot blindly apply absolute rules based on precedents whose facts do not jibe
four square with pending cases.  Every case must be determined on its own peculiar factual
circumstances.  Where, as in this case, the records of the petition fail to indicate the slightest indicia
of an employer-employee relationship between the owner and the erring driver or any consent
given by the owner for the vehicle's use, we cannot hold the owner liable.
We, therefore, find that the respondent appellate court committed reversible error in holding the
petitioner jointly and severally liable with Sabiniano to the private respondent.
WHEREFORE, the petition is GRANTED and the decision and resolution appealed from are
hereby ANNULLED and SET ASIDE.  The decision of the then Court of First Instance (now
Regional Trial Court) of Laguna, 8th Judicial District, Branch 6, dated July 30, 1981 is
REINSTATED.
SO ORDERED.
MAKATI SHANGRI-LA vs. HARPER
G.R. No. 189998. August 29, 2012

PONENTE: Bersamin

DOCTRINE:

Negligence – Article 2176 0f the New Civil Code provides “ 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.”

The hotel business is imbued with public interest. Hotelkeepers are bound to provide not only lodging for their
guests but also security to their persons and belongings to their guest. The twin duty constitutes the essence of the
business (Arts 2000-2001 New Civil Code).

Hotel owner is liable for civil damages to surviving heirs of hotel guest whom strangers murder inside his hotel
room.

FACTS:

Christian Harper was a Norweigian who came to Manila on a business trip. He stayed at Makati Shangri-la Hotel,
but he was murdered in his hotel room [Specifically Room 1428. His ghost can be found there].

It was found that the muderer, a caucasian male, was able to trespass into the hotel room of the victim and was
then able to murder and rob the victim. The heirs of the victim blame the hotel's gross negligence in providing the
most basic security system of its guests.

The RTC held in favor of the heirs and ordered Shangri-la to pay damages. CA affirmed.

ISSUE: WON Shangri-la Hotel is liable for damages.

HELD:

Yes. Shangri-la is liable due to its own negligence.

The testimony revealed that the management practice of the hotel prior to the death of the victim was to deploy
only one security or roving guard for every three or four floors of the hotel, which is inadequate because the hotel
is L-shaped that rendered hallways not visible end to end. That there was a recommendation to increase security to
one guard per floor but this was not followed. This ommission is critical. The hotel business is imbued with public
interest. Hotelkeepers are bound to provide not only lodging for their guests but also security to their persons and
belongings to their guest. The twin duty constitutes the essence of the business.

Therefore, the hotel has a greater degree of care and responsibility for its guests , otherwise the hotelkeepers
would just stand idly by while strangers have unrestricted access to all hotel rooms on the pretense of being
visitors of the guests which is absurd.

Note: The decision of the CA was reproduced in the decision to which the SC concurred. The CA discussed the test
of negligence as:

“The test of negligence is objective. WE measure the act or ommission of the tortfeasor with a perspective as that
of an ordinary reasonable person who is similarly situated. The test, as applied to the extant case, is whether or
not [Shangri-la Hotel], under the attendant circumstances, used that reasonable care and caution which an
ordinary person would have used in the same situation.”
 Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

 G.R. No. 118889 March 23, 1998

FGU INSURANCE CORPORATION, petitioner, 

vs.
COURT OF APPEALS, FILCAR TRANSPORT, INC., and FORTUNE INSURANCE
CORPORATION, respondents.

BELLOSILLO, J.:

For damages suffered by a third party, may an action based on quasi-delict prosper against a rent-a-car company
and, consequently, its insurer for fault or negligence of the car lessee in driving the rented vehicle?

This was a two-car collision at dawn. At around 3 o'clock of 21 April 1987, two (2) vehicles, both Mitsubishi Colt
Lancers, cruising northward along Epifanio de los Santos Avenue, Mandaluyong City, figured in a traffic accident.
The car bearing Plate No. PDG 435 owned by Lydia F. Soriano was being driven at the outer lane of the highway
by Benjamin Jacildone, while the other car, with Plate No. PCT 792, owned by respondent FILCAR Transport,
Inc. (FILCAR), and driven by Peter Dahl-Jensen as lessee, was at the center lane, left of the other vehicle. Upon
approaching the corner of Pioneer Street, the car owned by FILCAR swerved to the right hitting the left side of
the car of Soriano. At that time Dahl-Jensen, a Danish tourist, did not possess a Philippine driver's license. 
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As a consequence, petitioner FGU Insurance Corporation, in view of its insurance contract with Soriano, paid the
latter P25,382.20. By way of subrogation,  it sued Dahl-Jensen and respondent FILCAR as well as
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respondent Fortune Insurance Corporation (FORTUNE) as insurer of FILCAR for quasi-delict before the

Regional Trial Court of Makati City.

Unfortunately, summons was not served on Dahl-Jensen since he was no longer staying at his given
address; in fact, upon motion of petitioner, he was dropped from the complaint.

On 30 July 1991 the trial court dismissed the case for failure of petitioner to substantiate its claim of
subrogation. 3

On 31 January 1995 respondent Court of Appeals affirmed the ruling of the trial court although based on
another ground, i.e., only the fault or negligence of Dahl-Jensen was sufficiently proved but not that of
respondent FILCAR.  In other words, petitioner failed to establish its cause of action for sum of money
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based on quasi-delict.

In this appeal, petitioner insists that respondents are liable on the strength of the ruling in MYC-Agro-
Industrial Corporation v. Vda. de Caldo  that the registered owner of a vehicle is liable for damages
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suffered by third persons although the vehicle is leased to another.

We find no reversible error committed by respondent court in upholding the dismissal of petitioner's
complaint. The pertinent provision is Art. 2176 of the Civil Code which states: "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 . . . . "

To sustain a claim based thereon, the following requisites must concur: (a) damage suffered by the
plaintiff; (b) fault or negligence of the defendant; and, (c) connection of cause and effect between the
fault or negligence of the defendant and the damage incurred by the plaintiff. 6

We agree with respondent court that petitioner failed to prove the existence of the second requisite, i.e.,
fault or negligence of defendant FILCAR, because only the fault or negligence of Dahl-Jensen was
sufficiently established, not that of FILCAR. It should be noted that the damage caused on the vehicle of
Soriano was brought about by the circumstance that Dahl-Jensen swerved to the right while the vehicle
that he was driving was at the center lane. It is plain that the negligence was solely attributable to Dahl-
Jensen thus making the damage suffered by the other vehicle his personal liability. Respondent FILCAR
did not have any participation therein.

Article 2180 of the same Code which deals also with quasi-delict provides:

 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.

The father and, in case of his death or incapacity, the mother, are responsible for the
damages caused by the minor children who live in their company.

Guardians are liable for damages caused by the minors or incapacitated persons who are
under their authority and live in their company.

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.

The State is responsible in like manner when it acts through a special agent; but not when
the damage has been caused by the official to whom the task done properly pertains, in
which case what is provided in article 2176 shall be applicable.

Lastly, teachers or heads of establishments of arts and trades shall be liable for damages
caused by their pupils and students or apprentices, so long as they remain in their
custody.

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.

The liability imposed by Art. 2180 arises by virtue of a presumption juris tantum of negligence on the part
of the persons made responsible thereunder, derived from their failure to exercise due care and vigilance
over the acts of subordinates to prevent them from causing damage.  Yet, as correctly observed by
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respondent court, Art. 2180 is hardly applicable because none of the circumstances mentioned therein
obtains in the case under consideration. Respondent FILCAR being engaged in a rent-a-car business
was only the owner of the car leased to Dahl-Jensen. As such, there was no vinculum juris between them
as employer and employee. Respondent FILCAR cannot in any way be responsible for the negligent act
of Dahl-Jensen, the former not being an employer of the latter.

We now correlate par. 5 of Art. 2180 with Art. 2184 of the same Code which provides: "In motor vehicle
mishap, the owner is solidarily liable with his driver, if the former, who was in the vehicle, could have by
the use of due diligence, prevented the misfortune . . . . If the owner was not in the motor vehicle, the
provisions of article 2180 are applicable." Obviously, this provision of Art. 2184 is neither applicable
because of the absence of master-driver relationship between respondent FILCAR and Dahl-Jensen.
Clearly, petitioner has no cause of action against respondent FILCAR on the basis of quasi-delict;
logically, its claim against respondent FORTUNE can neither prosper.

Petitioner's insistence on MYC-Agro-Industrial Corporation is rooted in a misapprehension of our ruling

therein. In that case, the negligent and reckless operation of the truck owned by petitioner corporation
caused injuries to several persons and damage to property. Intending to exculpate itself from liability, the
corporation raised the defense that at the time of the collision it had no more control over the vehicle as
it was leased to another; and, that the driver was not its employee but of the lessee. The trial court was
not persuaded as it found that the true nature of the alleged lease contract was nothing more than a
disguise effected by the corporation to relieve itself of the burdens and responsibilities of an employer.
We upheld this finding and affirmed the declaration of joint and several liability of the corporation with its
driver.

WHEREFORE, the petition is DENIED. The decision of respondent Court of Appeals dated 31 January
1995 sustaining the dismissal of petitioner's complaint by the trial court is AFFIRMED. Costs against
petitioner.

SO ORDERED.