G.R. No.

116123 March 13, 1997

SERGIO F. NAGUIAT, doing business under the name and style SERGIO F. NAGUIAT
ENT., INC., & CLARK FIELD TAXI, INC., petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION (THIRD DIVISION), NATIONAL
ORGANIZATION OF WORKINGMEN and its members, LEONARDO T. GALANG, et
al., respondents.

FACTS:

Sergio Naguiat was the president of Clark Field Taxi, Inc. (CFTI) which supplied taxi services to
Clark Air Base. At the same time, Naguiat was a director of the Sergio F. Naguiat Enterprises,
Inc. (SFNEI), their family-owned corporation along with CFTI.

In 1991, CFTI had to close due to “great financial losses and lost business opportunity” resulting
from the phase-out of Clark Air Base brought about by the Mt. Pinatubo eruption and the
expiration of the RP-US military bases agreement.

CFTI then came up with an agreement with the drivers that the latter be entitled to a separation
pay in the amount of P500.00 per every year of service. Most of the drivers accepted this but
some drivers did not. The drivers who refused to accept the separation pay offered by CFTI
instead sued the latter before the labor arbiter.

The labor arbiter ruled in favor of the taxi drivers. The National Labor Relations Commission
affirmed the labor arbiter. It was established that when CFTI closed, it was in profitable standing
and was not incurring losses. It ruled that the drivers are entitled to $120.00 (or its peso
equivalent) per every year of service subject to exchange rates prevailing that time.

The NLRC likewise ruled that SFNEI as well as CFTI’s president and vice president Sergio
Naguiat and Antolin Naguiat should be held jointly and severally liable to pay the drivers. The
NLRC ruled that SFNEI actively managed CFTI and its business affairs hence it acted as the
employer of the drivers.
ISSUE: Whether or not the ruling of the NLRC is correct.

HELD: It is only partially correct.

1. NLRC is correct when it ruled that Sergio Naguiat is jointly and severally liable to pay
the drivers the award of separation pay in the amount so determined. As president of
CFTI, Sergio Naguiat is considered an “employer” of the dismissed employees who is
therefore liable for the obligations of the corporation to its dismissed employees.
Moreover, CFTI, being a close family corporation, is liable for corporate torts and
stockholders thereof shall be personally liable for corporate torts unless the corporation
has obtained reasonably adequate liability insurance (par. 5, Section 100, “Close
Corporations”, Corporation Code). Antolin Naguiat is absolved because there was
insufficient evidence as against him.
2. SFNEI  is not liable jointly or severally with CFTI. SFNEI has nothing to do with CFTI.
There is no sufficient evidence to prove that it actively managed CFTI especially so when
even the drivers testified that their employer is CFTI and that their payroll comes from
CFTI. Further, SFNEI was into trading business while CFTI was into taxi services.
G.R. No. L-48250 December 28, 1979

GRAND UNION SUPERMARKET, INC. and NELIA SANTOS FANDINO, petitioners,

vs.

JOSE J. ESPINO JR., and THE HONORABLE COURT OF APPEALS, respondents.

FACTS:

FACTS:

Jose J. Espino. Jr., a civil engineer and an executive of Procter and Gamble Philippines, Inc,
together with his wife and two daughters went to shop at South Supermarket in Makati

Finding a cylindrical "rat tail" file which he needed for his hobby, he picked it up and held it
fearing it might get lost because of its tiny size

While shopping, they saw the maid of Jose's aunt so as he talked, he placed the rat tail in his
breast pocket partly exposed

At the check-out counter, he paid for their purchases worth P77 but forgot to pay the file

As he was exiting the supermarket, he was approached by Guard Ebreo regarding the file in his
pocket. He quickly apologized saying "I'm Sorry" and he turned towards the cashier to pay. But,
he was stopped and instead was brought to the rear of the supermarket when he was asked to fill
out an Incident Report labeling him as "Shoplifter"

His wife joined him since he was taking so long and they were brought to the first checkout
counter where Ms. Nelia Santos-Fandino's desk was. She made a remark:"Ano, nakaw na naman
ito". Jose told Ms. Fandino that he was going to pay for the file because he needed it but she
replied "That is all they say, the people whom we cause not paying for the goods say... They all
intended to pay for the things that are found to them."

Jose objected stating he is a regular customer of the supermarket

He gave P5 to pay for the P3.85 cost of the file but Ms. Fandino said the P5 was his fine which
will be rewarded to the guard. People were staring at them. He took the file and paid the file at
the nearest checkout counter with P50 and got out as fast as they could. His first impulse was to
go back to the supermarket that night to throw rocks at its glass windows. But reason prevailed
over passion and he thought that justice should take its due course.

He filed against Grand Union Supermarket et al. founded on Article 21 in relation to Article
2219 of the New Civil Code and prays for moral damages, exemplary damages, attorney s fees
and 'expenses of litigation, costs of the suit and the return of the P5 fine

CFI: dismissed

CA: reversed and granted damages of P75,000 by way of moral damages, P25,000 as exemplary
damages, and P5,000 as attorney's fee

ISSUE: W/N Grand Union Supermarket should be liable for public humiliation founded on
Article 21 in relation to Article 2219 of the New Civil Code

HELD: YES. Grand Union Supermarket ordered to pay, jointly and severally moral damages
P5,000 and P2,000 as and for attorney's fees; and to return the P5 fine

Jose did not intend to steal the file and that is act of picking up the file from the open shelf was
not criminal nor done with malice or criminal intent for on the contrary, he took the item with the
intention of buying and paying for it

personal circumstances:

graduate Mechanical Engineer from U.P. Class 1950, employed as an executive of Proctor &
Gamble Phils., Inc., a corporate manager incharge of motoring and warehousing therein;
honorably discharged from the Philippine Army in 1946; a Philippine government pensionado of
the United States for six months; member of the Philippine veterans Legion; author of articles
published in the Manila Sunday Times and Philippines Free Press; member of the Knights of
Columbus, Council No. 3713; son of the late Jose Maria Espino, retired Minister, Department of
Foreign Affairs at the Philippine Embassy Washington

Jose was falsely accused of shoplifting is evident

Fine branding him as a thief which was not right nor justified

the mode and manner in which he was subjected, shouting at him, imposing upon him a fine,
threatening to call the police and in the presence and hearing of many people at the Supermarket
which brought and caused him humiliation and embarrassment, sufficiently rendered the
petitioners liable for damages under Articles 19 and 21 in relation to Article 2219 of the Civil
Code

It is against morals, good customs and public policy to humiliate, embarrass and degrade the
dignity of a person

Everyone must respect the dignity, personality, privacy and peace of mind of his neighbors and
other persons (Article 26, Civil Code)

His forgetfullness led to his embarassment and humiliation thereby causing him mental anguish,
wounded feelings and serious anxiety. His act of omission contributed to the occurrence of his
injury or loss and such contributory negligence is a factor which may reduce the damages that
private respondent may recover (Art. 2214, New Civil Code). Moreover, that many people were
present and they saw and heard the ensuing interrogation and altercation appears to be simply a
matter of coincidence in a supermarket which is a public place and the crowd of onlookers,
hearers or bystanders was not deliberately sought or called by management to witness private
respondent's predicament.

Grand Union Supermarket acted in good faith in trying to protect and recover their property, a
right which the law accords to them. - eliminate the grant of exemplary damages.
G.R. No. 140794           October 16, 2001

PEOPLE OF THE PHILIPPINES, appellee,

vs.
RICARDO AGLIDAY Y TOLENTINO, appellant.

FACTS:

Ricardo Aglipay = accused-appellant, Brgy. Tanod Conchita Agliday = witness, wife of Ricardo
Richard Agliday = son of Conchita & Reynaldo Rey Agliday = witness, son of Conchita &

Conchita & Ricardo quarreled over former’s working as a laundrywoman. Their son Richard
intervened & for that reason appellant got his shotgun and shot Richard. Ricardo ran but
eventually surrendered to the barangay captain who accompanied him to the police authorities.
Richard dies at Region I Medical Center at Dagupan City

Crime: Parricide

Contention of the Accused: While he was cleaning his homemade shotgun which he intended to
bring to night patrol in their barangay, the gun accidentally went off & Richard’s buttock was hit.
(Accidental shooting) Appellant contends that since he was only negligent, he should have been
convicted, not of parricide, but only of reckless imprudence resulting in homicide.

Contention of the State: In the case at bar, appellant got his shotgun and returned to the kitchen
to shoot his son, who had intervened in the quarrel between the former and Conchita. It must
also be pointed out that the firearm was a shotgun that would not have fired off without first
being cocked. Undoubtedly, appellant cocked the shotgun before discharging it, showing a clear
intent to fire it at someone. Reckless imprudence consists of voluntarily doing or failing to do,
without malice, an act from which material damage results by reason of an inexcusable lack of
precaution on the part of the person performing or failing to perform such act. Appellant’s
external acts prove malice or criminal intent. A deliberate intent to do an unlawful act is
inconsistent with reckless imprudence.
ISSUE/S: W/N defendant is exempted; W/N defendant is negligent

RULING:

Appellant protests the trial court's ruling that his defense of accidental shooting was fabricated.
According to him, he was cleaning the shotgun that he would have used for the evening patrol
with other barangay tanods when he accidentally touched the trigger and hit Richard, who was
going up the stairs into the house with Conchita.17 he therefore contends that he should be
acquitted on the basis of the exempting circumstance of accident under Article 12 (paragraph 4)
of the Revised Penal Code.

We are not persuaded. Both the trial court and the solicitor general rejected this defense on the
basis of the eyewitness testimonies of Conchita and Rey. Under Article 12 (paragraph 4) of the
Code, criminal liability does not arise in a case a crime is committed by "[a]ny person who,
while performing a lawful act with due care, causes an injury by mere accident without fault or
intention of causing it." The exemption from criminal liability under the circumstance showing
accident is based on the lack of criminal intent.

Appellant contends that since he was only negligent, he should have been convicted, not of
parricide, but only of reckless imprudence resulting in homicide.27

We disagree. Reckless imprudence consists of voluntarily doing or failing to do, without malice,
an act from which material damage results by reason of an inexcusable lack of precaution on the
part of the person performing or failing to perform such act. Past jurisprudential cases of reckless
imprudence resulting in homicide were as follows: (1) exhibiting a loaded revolver to a friend,
who got killed by the accidental discharge arising from negligent handling; (2) discharging a
firearm from the window of one's house and killing a neighbor who, at just that moment, leaned
over a balcony front; and (3) firing a .45 caliber pistol twice in the air to stop a fist fight; and, as
the fight continued, firing another shot at the ground but, after the bullet ricocheted, hitting a
bystander who died thereafter.28

Intent is not lacking in the instant case. Appellant's external acts prove malice or criminal intent.
A deliberate intent to do an unlawful act is inconsistent with reckless imprudence.29
In People v. Belbes,30 the Court found no reckless imprudence in the shooting of a student who,
in the act of destroying the school's bamboo wall, had been caught by a policeman who was
responding to a report that somebody was causing trouble in a school affair. The policeman's
action cannot be characterized as reckless imprudence, because the shooting was intentional. The
accused had intended to fire at the victim and in fact hit only the latter. In this case, resenting his
son's meddling in his argument with his wife, appellant purposely took his gun and shot his son.

WHEREFORE, the appeal is hereby DENIED and the assailed Decision AFFIRMED. Costs

against appellant.

SO ORDERED.
G.R. No. 175863               February 18, 2015

NATIONAL POWER CORPORATION, Petitioner,

vs.
LUCMAN M. IBRAHIM, ATTY. OMAR G. MARUHOM, ELIAS G. MARUHOM,
BUCAY G. MARUHOM, MAMOD G. MARUHOM, FAROUK G. MARUHOM,
HIDJARA G. MARUHOM, ROCANIA G. MARUHOM, POTRISAM G. MARUHOM,
LUMBA G. MAR UH OM, SIN AB G. MARUHOM, ACMAD G. MARUHOM,
SOLAYMAN G. MARUHOM, MOHAMAD M. IBRAHIM, CAIRONESA M. IBRAHIM
and MACAPANTON K. MANGONDATO Respondents.

FACTS:

In 1978, petitioner took possession of a 21,995 square meter parcel of land in Marawi City for
the purpose of building thereon a hydroelectric power plant pursuant to its Agus 1 project. The
subject land, while in truth a portion of a private estate registered in the name of herein
respondent Macapanton K. Mangondato, was occupied by petitioner under the mistaken belief
that such land is part of the vast tract of public land reserved for its use by the government under
Proclamation No. 1354, s. 1974.

Mangondato first discovered petitioner’s occupation of the subject land in 1979—the year that
petitioner started its construction of the Agus 1plant. Shortly after such discovery, Mangondato
began demanding compensation for the subject land from petitioner.

Petitioner, at first, rejected Mangondato’s claim of ownership over the subject land. But, after
more than a decade, petitioner finally acquiesced to the fact that the subject land is a private land.

The parties failed to come up with an agreement regarding the compensation.

Mangondato filed a complaint for reconveyance against petitioner before the RTC Marawi City.
Mangondato asked for, among others, the recovery of the subject land and the payment by
petitioner of a monthly rental from 1978 until the return of such land.
Petitioner filed an expropriation complaint before the RTC.

Later, Civil Case No. 605-92 and Civil Case No. 610-92 were consolidated before Branch 8 of
the Marawi City RTC.

RTC upheld petitioner’s right to expropriate the subject land: it denied Mangondato’s claim for
reconveyance and decreed the subject land condemned in favor of the petitioner, effective July of
1992, subject to payment by the latter of just compensation in the amount of ₱21,995,000.00.
Anent petitioner’s occupation of the subject land from 1978to July of 1992, on the other hand,
the decision required the former to pay rentals therefor at the rate of ₱15,000.00 per month
with12% interest per annum.

Disagreeing with the amount of just compensation that it was adjudged to pay under the said
decision, petitioner filed an appeal with the Court of Appeals (CA-G.R. CV No. 39353).

During the pendency of CA-G.R. CV No. 39353, respondents the Ibrahims and Maruhoms filed
before the RTC of Marawi City a complaint (Civil Case No. 967-93) against Mangondato and
petitioner. The Ibrahims and Maruhoms disputed Mangondato’s ownership of the lands They
should be the ones entitled to any rental fees or expropriation indemnity that may be found due
for the subject land.

CA (CA-G.R. CV No. 39353) affirmed the RTC decision. Undeterred, petitioner next filed a
petition for review on certiorari with this SC.

SC upheld the CA decision. SC decision became final and executory.

Mangondato filed a motion for execution. Petitioner filed an opposition. RTC found no merit in
petitioner’s opposition and ordered the issuance of a writ of execution in favor of Mangondato.
RTC also ordered the issuance of a notice of garnishment against several of petitioner’s bank
accounts for the amount of ₱21,801,951.00—the figure representing the total amount of
judgment debt due from petitioner less the amount then already settled by the latter.

Upon the other hand (Civil Case No. 967-93), RTC found that the Ibrahims and Maruhoms—not
Mangondato—are the true owners of the subject land. However, it could no longer be
reconveyed since the same was already expropriated and paid. RTC thus required payment of all
the rental fees and expropriation indemnity due to the Ibrahims and Maruhoms.

Notable in the trial court’s decision, however, was that it held both Mangondato and the
petitioner solidarily liable to the Ibrahims and Maruhoms for the rental fees and expropriation
indemnity.

Petitioner appealed the decision in Civil Case No. 967-93 with the Court of Appeals.

While the foregoing appeal was still pending decision by the Court of Appeals, however, the
Ibrahims and Maruhoms were able to secure with the court a quo a writ of execution pending
appeal. The enforcement of such writ led to the garnishment of Mangondato’s moneys in the
possession of the Social Security System (SSS) in the amount of ₱2,700,000.

CA denied petitioner’s appeal.

Hence, the petitioner appeals to SC.

For the two tribunals, the bad faith on the part of petitioner rendered its previous payment to
Mangondato invalid insofar as the Ibrahims and Maruhoms are concerned. Hence, both courts
concluded that petitioner may still be held liable to the Ibrahims and Maruhoms for the rental
fees and expropriation indemnity previously paid to Mangondato.

Petitioner, however, argues otherwise. It submits that a finding of bad faith against it would have
no basis in fact and law, given that it merely complied with the final and executory decision in
Civil Case No. 605-92 and Civil Case No. 610-92 when it paid the rental fees and expropriation
indemnity due the subject to Mangondato. Petitioner thus insists that it should be absolved from
any liability to pay the rental fees and expropriation indemnity to the Ibrahims and Maruhoms
and prays for the dismissal of Civil Case No. 967-93 against it.

ISSUE/S:

W/N NAPOCOR acted in bad faith in paying Mangondato.

RULING: NO.

Petitioner is correct. No "bad faith" may be taken against it in paying Mangondato the rental fees
and expropriation indemnity due the subject land.

A finding of bad faith, thus, usually assumes the presence of two (2) elements: first, that the actor
knew or should have known that a particular course of action is wrong or illegal, and second, that
despite such actual or imputable knowledge, the actor, voluntarily, consciously and out of his
own free will, proceeds with such course of action. Only with the concurrence of these two
elements can we begin to consider that the wrong committed had been done deliberately and,
thus, in bad faith.

Branch 10 of the Marawi City RTC and the Court of Appeals erred in their finding of bad faith
because they have overlooked the utter significance of one important fact: that petitioner’s
payment to Mangondato of the rental fees and expropriation indemnity adjudged due for the
subject land in Civil Case No. 605-92 and Civil Case No. 610-92, was required by the final and
executory decision in the said two cases and was compelled thru a writ of garnishment issued by
the court that rendered such decision. In other words, the payment to Mangondato was not a
product of a deliberate choice on the part of the petitioner but was made only in compliance to
the lawful orders of a court with jurisdiction.

Contrary then to the view of Branch 10 of the Marawi City RTC and of the Court of Appeals, it
was not the petitioner that "allowed" the payment of the rental fees and expropriation indemnity
to Mangondato. Indeed, given the circumstances, the more accurate rumination would be that it
was the trial court in Civil Case No. 605-92 and Civil Case No. 610-92 that ordered or allowed
the payment to Mangondato and that petitioner merely complied with the order or allowance by
the trial court. Since petitioner was only acting under the lawful orders of a court in paying
Mangondato, we find that no bad faith can be taken against it, even assuming that petitioner may
have had prior knowledge about the claims of the Ibrahims and Maruhoms upon the subject land
and the TRO issued in Civil Case No. 967-93.

Without the existence of bad faith, the ruling of the RTC and of the Court of Appeals apropos
petitioner’s remaining liability to the Ibrahims and Maruhoms becomes devoid of legal basis. In
fact, petitioner’s previous payment to Mangondato of the rental fees and expropriation indemnity
due the subject land pursuant to the final judgment in Civil Case No. 605-92 and Civil Case No.
610-92 may be considered to have extinguished the former’s obligation regardless of who
between Mangondato, on one hand, and the Ibrahims and Maruhoms, on the other, turns out to
be the real owner of the subject land. Either way, petitioner cannot be made liable to the
Ibrahims and Maruhoms:

First. If Mangondato is the real owner of the subject land, then the obligation by petitioner to pay
for the rental fees and expropriation indemnity due the subject land is already deemed
extinguished by the latter’s previous payment under the final judgment in Civil Case No. 605-92
and Civil Case No. 610-92. This would be a simple case of an obligation being extinguished
through payment by the debtor to its creditor.63 Under this scenario, the Ibrahims and Maruhoms
would not even be entitled to receive anything from anyone for the subject land. Hence,
petitioner cannot be held liable to the Ibrahims and Maruhoms.

Second. We, however, can reach the same conclusion even if the Ibrahims and Maruhoms turn
out to be the real owners of the subject land.

Should the Ibrahims and Maruhoms turn out to be the real owners of the subject land,
petitioner’s previous payment to Mangondato pursuant to Civil Case No. 605-92 and Civil Case
No. 610-92—given the absence of bad faith on petitioner’s part as previously discussed—may
nonetheless be considered as akin to a payment made in "good faith "to a person in "possession
of credit" per Article 1242 of the Civil Code that, just the same, extinguishes its obligation to pay
for the rental fees and expropriation indemnity due for the subject land. Article 1242 of the Civil
Code reads:

"Payment made in good faith to any person in possession of the credit shall release the debtor."
Article 1242 of the Civil Code is an exception to the rule that a valid payment of an obligation
can only be made to the person to whom such obligation is rightfully owed.64 It contemplates a
situation where a debtor pays a "possessor of credit" i.e., someone who is not the real creditor but
appears, under the circumstances, to be the real creditor.65 In such scenario, the law considers the
payment to the "possessor of credit" as valid even as against the real creditor taking into account
the good faith of the debtor.

Borrowing the principles behind Article 1242 of the Civil Code, we find that Mangondato—
being the judgment creditor in Civil Case No. 605-92 and Civil Case No. 610-92 as well as the
registered owner of the subject land at the time66 —may be considered as a "possessor of credit"
with respect to the rental fees and expropriation indemnity adjudged due for the subject land in
the two cases, if the Ibrahims and Maruhoms turn out to be the real owners of the subject land.
Hence, petitioner’s payment to Mangondato of the fees and indemnity due for the subject land as
a consequence of the execution of Civil Case No. 605-92 and Civil Case No. 610-92 could still
validly extinguish its obligation to pay for the same even as against the Ibrahims and Maruhoms.
G.R. No. L-13505            February 4, 1919

GEO. W. DAYWALT, plaintiff-appellant,
vs.
LA CORPORACION DE LOS PADRES AGUSTINOS RECOLETOS, ET AL., defendants-
appellees.

FACTS:

Teoderica Endencia obligated herself to convey to Geo W. Daywalt a tract of land. The deed
should be executed as soon as the tittle of the land is perfected. There was a decree recognizing
Teoderica as the owner of land but the Torrens certificate was not issued until later. The parties
met immediately upon the entering of the decree and made a new contract.

There was a development of Teoderica’s land as the Torrens title was issued and in view of this
development she became reluctant to transfer the whole tract of land asserting that she never
intended to sell the large amount of land and that she was misinformed by the area of the land.

After the Torrens title was issued to Teoderica she gave it to the defendant company for
safekeeping in which the defendant did so. As Teodorica still retained possession of said
property Father Sanz entered into an arrangement with her whereby large numbers of cattle
belonging to the defendant corporation were pastured upon said land.

ISSUE:

Whether a person who is not a party to a contract for the sale of land makes himself liable for
damages to the vendee, beyond the value of the use and occupation, by colluding with the vendor
and maintaining him in the effort to resist an action for specific performance. 

RULING:
The Supreme Court held that the members of the defendant’s corporation, in advising and
prompting Teodorica Endencia not to comply with the contract of sale, were actuated by
improper and malicious motives.

In a fair conclusion on this feature of the case is that father Juan Labarga and his associates
believed in good faith that the contract could not be enforced and that Teodorica would be
wronged if it should be carried into effect. Any advice or assistance which they may have given
was, therefore, prompted by no mean or improper motive.

In the case at bar, as Teodorica Endencia was the party directly bound by the contract, it is
obvious that the liability of the defendant corporation, even admitting that it has made itself
coparticipant in the breach of the contract, can in not even exceed hers.

This leads us to consider at this point the extent of the liability of Teodorica Endencia to the
plaintiff by reason of her failure to surrender the certificate of title and to place the plaintiff in
possession.

Translated into terms applicable to the case at bar, the decision in Gilchrist vs. Cuddy (29 Phil.
Rep., 542), indicates that the defendant corporation, having notice of the sale of the land in
question to Daywalt, might have been enjoined by the latter from using the property for grazing
its cattle thereon. That the defendant corporation is also liable in this action for the damage
resulting to the plaintiff from the wrongful use and occupation of the property has also been
already determined. But it will be observed that in order to sustain this liability it is not necessary
to resort to any subtle exegesis relative to the liability of a stranger to a contract for unlawful
interference in the performance thereof. It is enough that defendant use the property with notice
that the plaintiff had a prior and better right.

Article 1902 of the Civil Code declares that any person who by an act or omission, characterized
by fault or negligence, causes damage to another shall be liable for the damage so done. Ignoring
so much of this article as relates to liability for negligence, we take the rule to be that a person is
liable for damage done to another by any culpable act; and by "culpable act" we mean any act
which is blameworthy when judged by accepted legal standards. The idea thus expressed is
undoubtedly broad enough to include any rational conception of liability for the tortious acts
likely to be developed in any society. Thus considered, it cannot be said that the doctrine of
Lumley vs. Gye [supra] and related cases is repugnant to the principles of the civil law.

Nevertheless, it must be admitted that the codes and jurisprudence of the civil law furnish a
somewhat uncongenial field in which to propagate the idea that a stranger to a contract may sued
for the breach thereof. Article 1257 of the Civil Code declares that contracts are binding only
between the parties and their privies. In conformity with this it has been held that a stranger to a
contract has no right of action for the nonfulfillment of the contract except in the case especially
contemplated in the second paragraph of the same article. (Uy Tam and Uy Yet vs. Leonard, 30
Phil. Rep., 471.) As observed by this court in Manila Railroad Co. vs. Compañia Transatlantica,
R. G. No. 11318 (38 Phil. Rep., 875), a contract, when effectually entered into between certain
parties, determines not only the character and extent of the liability of the contracting parties but
also the person or entity by whom the obligation is exigible. The same idea should apparently be
applicable with respect to the person against whom the obligation of the contract may be
enforced; for it is evident that there must be a certain mutuality in the obligation, and if the
stranger to a contract is not permitted to sue to enforce it, he cannot consistently be held liable
upon it.
G.R. No. L-24803 May 26, 1977

PEDRO ELCANO and PATRICIA ELCANO, in their capacity as Ascendants of Agapito

Elcano, deceased, plaintiffs-appellants,
vs.
REGINALD HILL, minor, and MARVIN HILL, as father and Natural Guardian of said
minor, defendants-appellees.

FACTS:

Respondent Reginald Hill killed the son of the plaintiffs named Agapito Elcano. A criminal
complaint was instituted against him but he was acquitted on the ground that his act was not
criminal, because of lack of intent to kill, couple with mistake. Subsequently, plaintiffs filed a
complaint for recovery of damages against defendant Reginald Hill, a minor, married at the time
of the occurrence, and his father, the defendant Marvin Hill, with who he was living and getting
subsistence, for the same killing. A motion to dismiss was filed by the defendants. The Court of
First Instance of Quezon City denied the motion. Nevertheless, the civil case was
finally dismissed upon motion for reconsideration.

Issues:

1. WON the present civil action for damages is barred by the acquittal of Reginald in the
criminal case.

2. WON Article 2180 (2nd and last paragraphs) of the Civil Code may be applied against Atty.
Hill, notwithstanding the undisputed fact that at the time of the occurrence complained of.
Reginald, though a minor, living with and getting subsistence from his father, was already
legally married.

Ruling of the Court:

1. No, the present civil action for damages is not barred by the acquittal of Reginald in the
criminal case. Firstly, there is a distinction as regards the proof required in a criminal case and a
civil case. To find the accused guilty in a criminal case, proof of guilt beyond reasonable doubt is
required, while in a civil case, preponderance of evidence is sufficient to make the defendant pay
in damages. Furthermore, a civil case for damages on the basis of quasi-delict does is
independently instituted from a criminal act. As such the acquittal of Reginald Hill in the
criminal case has not extinguished his liability for quasi-delict, hence that acquittal is not a bar to
the instant action against him.

2. Yes, the above mentioned provision may still be applied against Atty Marvin Hill. Although
parental authority is terminated upon emancipation of the child, emancipation by marriage is not
absolute, i.e. he can sue and be sued in court only with the assistance of his father, mother or
guardian. As in the present case, killing someone else contemplated judicial litigation, thus,
making Article 2180 apply to Atty. Hill.However, inasmuch as it is evident that Reginald is now
of age, as a matter of equity, the liability of Atty. Hill has become milling, subsidiary to that of
his son.
G.R. No. L-11318             October 26, 1918

THE MANILA RAILROAD CO., plaintiff-appellant,

vs.
LA COMPAÑIA TRANSATLANTICA, defendant-appellee. and
THE ATLANTIC GULF & PACIFIC CO., defendant-appellant.

FACTS:

SS/Alicante, belonging to Compania Transatlantica de Barcelona was transporting two

locomotive boilers for the Manila Railroad Company.  The equipment of the ship for discharging
the heavy cargo was not strong enough to handle the boilers.  Compania Transatlantica
contracted the services of Atlantic gulf and Pacific Co., which had the best equipment to lift the
boilers out of the ship’s hold.  When Alicante arrived in Manila, Atlantic company sent out its
floating crane under the charge of one Leyden.  When the first boiler was being hoisted out of
the ship’s hold, the boiler could not be brought out because the sling was not properly placed and
the head of the boiler was caught under the edge of the hatch.  The weight on the crane was
increased by a strain estimated at 15 tons with the result that the cable of the sling broke and the
boiler fell to the bottom of the ship’s hold.  The sling was again adjusted and the boiler was again
lifted but as it was being brought up the bolt at the end of the derrick broke and the boiler fell
again.  The boiler was so badly damaged that it had to be shipped back to England to be rebuilt. 
The damages suffered by Manila Railroad amounted to P23,343.29.  Manila Railroad then filed
an action against the Streamship Company to recover said damages.  The Steamship Company
caused Atlantic Company to be brought as co-defendant arguing that Atlantic Company as an
independent contractor, who had undertaken to discharge the boilers had become responsible for
the damage.      

The Court of First Instance decided in favor of Manila Railroad, the plaintiff, against Atlantic
Company and absolved the Steamship Company.  Manila Railroad appealed from the decision
because the Steamship Company was not held liable also.  Atlantic Company also appealed from
the judgment against it. 
ISSUES:
Was the Steamship Company liable to Manila Railroad for delivering the boiler in a damaged
condition?

Was Atlantic Company liable to the Steamship Company for the amount it may be required to
pay the plaintiff?

Was Atlantic Company directly liable to plaintiff as held by the trial court?

RULING:

      There was a contractual relation between the Steamship Company and Manila Railroad. 
There was also a contractual relation between the Steamship Company and Atlantic.  But there
was no contractual relation between the Railroad Company and Atlantic Company.

      There was no question that the Steamship Company was liable to Manila Railroad as it had
the obligation to transport the boiler in a proper manner safe and securely under the
circumstances required by law and customs.  The Steamship Company cannot escape liability
simply because it employed a competent independent contractor to discharge the boiler.

      Atlantic Company claimed that it was not liable, because it had employed all the diligence of
a good father of a family and proper care in the selection of Leyden.  Said argument was not
tenable, because said defense was not applicable to negligence arising in the course of the
performance of a contractual obligation.  The same can be said with respect to the liability of
Atlantic Company upon its contract with the Steamship Company.  There was a distinction
between negligence in the performance of a contractual obligation (culpa contractual) and
negligence considered as an independent source of obligation (culpa aquiliana).  Atlantic
Company wasis liable to the Steamship Company for the damage brought upon the latter by the
failure of Atlantic Company to use due care in discharging the boiler, regardless of the fact that
the damage was caused by the negligence of an employee who was qualified for the work, duly
chose with due care.
      Since there was no contract between the Railroad Company and Atlantic Company, Railroad
Company can had no right of action to recover damages from Atlantic Company for the
wrongful act which constituted the violation of the contract.  The rights of Manila Railroad can
only be made effective through the Steamship Company with whom the contract of
affreightment was made.

It must not be forgotten that what we have said relates the actions upon the contract with the
conditions mentioned and not t actions for damages in an action ex delicto resulting from the
negligent performance of duties and obligations assumed.

The appellant, the Atlantic, Gulf & Pacific company, contends that inasmuch as it had exercised
the care of a good father of a family in selecting its employees, that it should be relieved from all
liability by virtue of the provisions of article 1903 of the Civil Code. We do not believe that the
provisions of said article can be invoked when the rights and liabilities of parties to an action
depend upon a contract. The right of parties are defined by the contract and there is no occasion t
invoke the statute. The argument employed by the Atlantic, Gulf & Pacific Company if valid,
would also relieve the Compañia Transatlantic had not exercised the care of a good father of a
family in selecting it for the discharge of said boilers. Neither d we believe that the provisions of
article 1902 of the Civil Code can be invoked in favor of the Compañia Transatlantica for the
reason that the contract governs the rights and liabilities and by the terms of the contract the
Atlantic, Gulf & Pacific Company is relieved from all liability whatsoever. A relief from all
liability is a relief from any liability caused by negligence, especially so when the action is based
upon a contract. Whether or not the rule should be followed in an action of tort growing out of
willful negligence, square?
G.R. No. L-12191             October 14, 1918

JOSE CANGCO, plaintiff-appellant,
vs.
MANILA RAILROAD CO., defendant-appellee.

FACTS:

Jose Cangco was in the employment of Manila Railroad Company. He lived in the pueblo of San
Mateo, in the province of Rizal, which is located upon the line of the defendant railroad
company; and in coming daily by train to the company’s office in the city of Manila where he
worked, he used a pass, supplied by the company, which entitled him to ride upon the company’s
trains free of charge.

During his ride in the train he arose from his seat and makes his way to the exit while the train is
still on travel. When the train has proceeded a little farther Jose Cangco step down into the
cement platform but unfortunately step in to a sack of watermelon, fell down and rolled under
the platform and was drawn under the moving car which resulting to his arm to be crashed and
lacerated. He was rushed to the hospital and sued the company and the employee who put the
sack of watermelon in the platform.

The accident occurred between 7 and 8 o’ clock on the dark night. It is that time of the year that
may we considered as season to harvest watermelon explaining why there are sacks of
watermelon in the platform. The plaintiff contends that it is the negligence of the Manila
Railroad Co. on why they let their employees put a hindrance in the platform that may cause
serious accident. The defendant answered that it is the lack of diligence on behalf of the plaintiff
alone on why he did not wait for the train to stop before alighting the train.

ISSUE:

Whether or not the company is liable or there is a contributory negligence on behalf of the
plaintiff.
RULING:

There is no contributory negligence on behalf of the plaintiff. The Supreme Court provides some
test that may find the contributory negligence of a person. Was there anything in the
circumstances surrounding the plaintiff at the time he alighted from the train which would have
admonished a person of average prudence that to get off the train under the conditions then
existing was dangerous? If so, the plaintiff should have desisted from alighting; and his failure so
to desist was contributory negligence.

Alighting from a moving train while it is slowing down is a common practice and a lot of people
are doing so every day without suffering injury. Cangco has the vigor and agility of young
manhood, and it was by no means so risky for him to get off while the train was yet moving as
the same act would have been in an aged or feeble person. He was also ignorant of the fact that
sacks of watermelons were there as there were no appropriate warnings and the place was dimly
lit.

Article 1173, first paragraph: The fault or negligence of the obligor consists in the omission of
that diligence which is required by the nature of the obligation and corresponds with the
circumstances of that persons, of the time and of the place. When negligence shows bad faith, the
provisions of Article 1171 and 2201, paragraph 2, shall apply.

In the case the proximate cause of the accident is the lack of diligence of the company to inform
their employees to not put any hindrance in the platform like sacks of watermelon. The contract
of defendant to transport plaintiff carried with it, by implication, the duty to carry him in safety
and to provide safe means of entering and leaving its trains (civil code, article 1258). That duty,
being contractual, was direct and immediate, and its non-performance could not be excused by
proof that the fault was morally imputable to defendant’s servants. Therefore, the company is
liable for damages against Cangco.
G.R. No. 411            April 23, 1902

DONALDSON, SIM AND CO., plaintiffs-appellants,

vs.
SMITH, BELL AND CO, defendants-appellees.

FACTS:

Plaintiffs filed an action to recover damages against the defendants for wrongful occupancy of
certain warehouses in Manila. The buildings in question were the property of Luis R. Yangco,
and had been leased by him in July, 1899, to the military government of the United States, by
which they had been sublet to the defendants under an arrangement the details of which it is not
necessary to state.

Yangco objected to the occupancy of the buildings by the defendant, and on the 11th of April,
1900, the Chief Quartermaster of the Army, acting apparently under a misapprehension as to the
facts respecting the defendants arrangement with the Government, addressed a letter to them,
stating that the records of the office failed to show that they had any right to the occupancy if the
buildings, and requesting that they be vacated at once.

On the 30th of April the lease from Yangco to the Government was terminated by mutual
consent. On the 1st of May, Yangco leased the buildings to the plaintiffs for one year. On the
same day the plaintiffs notified the defendants of the lease, and requested them to vacate the
buildings within twenty four hours. This the defendants declined to do, and continued in the
occupancy of the warehouses, or some of them, to the exclusion of the plaintiffs, till
subsequently to the 14th of May. The judgment in the court below was in favor of the
defendants, and the plaintiffs appealed.

ISSUE: Whether the defendants have failed to perform any duty which they owed to the
plaintiffs.
RULING:

Not having entered into possession under their lease, they had acquitted no rights in the leased
property in the nature of rights in rem, and which third persons were therefore bound not to
infringe. Article 1560 of the Civil Code, which gives the lessee a direct action against a
trespasser, is confined to the case of an actual interference with the lessee's use of the property.
Here such use by the plaintiffs had not begun when the alleged wrongs were committed.

Article 1902 of the Civil Code, relied upon by the plaintiffs, established the general principle of
liability for damage caused by fault or negligence, but there can be no fault or negligence where,
as in the present case, there was no obligation resting upon the person causing the damage to
exercise diligence as respects the injured person.

The failure to establish any legal relation between the parties, giving rise to rights in the
plaintiffs and corresponding duties on the part of the defendants, as respects the occupancy of the
buildings in question, is fatal to the plaintiff's recovery in this section. Their remedy, if they have
any, is against the lessor, under articles 1554 and 1556 of the Civil Code.

The judgment must be affirmed, with costs. So ordered.

G.R. No. L-31276 September 9, 1982

NATIONAL LABOR UNION, petitioner,

vs.
COURT OF INDUSTRIAL RELATIONS, EVERLASTING MANUFACTURING, ANG
WO LONG and BENITO S. ESTANISLAO, respondents.

FACTS:

In order to avoid the implementation of the collective bargaining contract, to bust complainant
union, to discourage membership with complainant union, on the pretext of selling and closing
its business, and without any justifiable reason respondent company, by its general manager
Benito Estanislao and proprietor Ang Wo Long, dismissed and/or locked out all the members of
complainant union.

Respondent company continued with its business operations by availing of the services new
workers who are non-union members. Notwithstanding representations made by complaint union
for and in behalf of its members, respondent failed and refused and continues to fail and refuse to
reinstate them to their jobs.
G.R. No. 120639 September 25, 1998

BPI EXPRESS CARD CORPORATION, petitioner,

vs.
COURT OF APPEALS and RICARDO J. MARASIGAN, respondents.

FACTS:
G.R. No. L-20089      December 26, 1964

BEATRIZ P. WASSMER, plaintiff-appellee,
vs.
FRANCISCO X. VELEZ, defendant-appellant.

FACTS:

Francisco Velez and Beatriz Wassmer planned to get married. However, Velez went away
and Beatriz did not hear from him again. Beatriz sued Francisco and asked the latter to pay her
moral damages. Velez contended that there is no provision of the law authorizing an action for
breach of promise to marry. However, the court did not find this defense meritorious because
even though it is true that there is no law for breach of promise to marry, Wassmer still
suffered frustration and public humiliation.

ISSUE:

Did the court err in ordering the defendant to pay plaintiff moral damages?

RULING:

The case at bar is not a mere breach of promise to marry because it is not considered an
actionable wrong. The mere fact the couple have already filed a marriage license and already
spent for invitations, wedding apparels, gives the plaintiff reason to demand for payment
of damages. The court affirmed the previous judgment and ordered the defendant to pay the
plaintiff moral damages for the humiliation she suffered; actual damages for
the expenses incurred and exemplary damages because the defendant acted fraudulently in
making the plaintiff believe that he will come back and the wedding will push through.
G.R. No. 74761 November 6, 1990

NATIVIDAD V. ANDAMO and EMMANUEL R. ANDAMO, petitioners,

vs.
INTERMEDIATE APPELLATE COURT (First Civil Cases Division) and
MISSIONARIES OF OUR LADY OF LA SALETTE, INC., respondents.

FACTS:

 Missionaries of Our Lady of La Salette, Inc., a religious corporation, built through its

agents, waterpaths, water conductors and contrivances including an artificial lake within
its land

 inundated and eroded the spouses Emmanuel and Natividad Andamo's land,

caused a young man to drown, damaged petitioners' crops and plants, washed
away costly fences, endangered the lives of petitioners and their laborers during
rainy and stormy seasons, and exposed plants and other improvements to
destruction
 July 1982:spouses instituted a criminal action
 February 22, 1983: spouses filed a civil case for damages
 CA affirmed trial court issued an order suspending further hearings in Civil Case until
after judgment in the related Criminal Case
 spouses contend that the trial court and the Appellate Court erred in dismissing
Civil Case since it is predicated on a quasi-delict

ISSUE: W/N there is quasi-delict even if done in private propety

HELD: YES. REVERSED and SET ASIDE

 All the elements of a quasi-delict are present, to wit: 

  (a) damages suffered by the plaintiff
 (b) fault or negligence of the defendant, or some other person for whose acts he
must respond
 (c) the connection of cause and effect between the fault or negligence of the
defendant and the damages incurred by the plaintiff
 While the property involved in the cited case belonged to the public domain and the
property subject of the instant case is privately owned, the fact remains that petitioners'
complaint sufficiently alleges that petitioners have sustained and will continue to sustain
damage due to the waterpaths and contrivances built by respondent corporation
 It must be stressed that the use of one's property is not without limitations. Article 431 of
the Civil Code provides that "the owner of a thing cannot make use thereof in such a
manner as to injure the rights of a third person."  SIC UTERE TUO UT ALIENUM NON
LAEDAS.  Moreover, adjoining landowners have mutual and reciprocal duties which
require that each must use his own land in a reasonable manner so as not to infringe upon
the rights and interests of others. Although we recognize the right of an owner to build
structures on his land, such structures must be so constructed and maintained using all
reasonable care so that they cannot be dangerous to adjoining landowners and can
withstand the usual and expected forces of nature. If the structures cause injury or
damage to an adjoining landowner or a third person, the latter can claim indemnification
for the injury or damage suffered.
 Article 2177. Responsibility for fault or negligence under the preceding article is entirely
separate and distinct from the civil liability arising from negligence under the Penal
Code. But the plaintiff cannot recover damages twice for the same act or omission of the
defendant.
 whether it be conviction or acquittal would render meaningless the independent character
of the civil action and the clear injunction in Article 31, that his action may proceed
independently of the criminal proceedings and regardless of the result of the latter
G.R. No. L-21438             September 28, 1966

AIR FRANCE, petitioner,
vs.
RAFAEL CARRASCOSO and the HONORABLE COURT OF APPEALS, respondents.

FACTS:

Plaintiff, a civil engineer, was a member of a group of 48 Filipino pilgrims that left Manila for
Lourdes on March 30, 1958.
On March 28, 1958, the defendant, Air France, through its authorized agent, Philippine Air
Lines, Inc., issued to plaintiff a "first class" round trip airplane ticket from Manila to Rome.
From Manila to Bangkok, plaintiff travelled in "first class", but at Bangkok, the Manager of the
defendant airline forced plaintiff to vacate the "first class" seat that he was occupying because, in
the words of the witness Ernesto G. Cuento, there was a "white man", who, the Manager alleged,
had a "better right" to the seat. When asked to vacate his "first class" seat, the plaintiff, as was to
be expected, refused, and told defendant's Manager that his seat would be taken over his dead
body. After some commotion, plaintiff reluctantly gave his "first class" seat in the plane.

DECISION OF LOWER COURTS:

1. CFI – Manila: sentenced petitioner to pay respondent Rafael Carrascoso P25,000.00 by way of
moral damages; P10,000.00 as exemplary damages; P393.20 representing the difference in fare
between first class and tourist class for the portion of the trip Bangkok- Rome, these various
amounts with interest at the legal rate, from the date of the filing of the complaint until paid; plus
P3,000.00 for attorneys' fees; and the costs of suit.
2. CA: slightly reduced the amount of refund on Carrascoso's plane ticket from P393.20 to
P383.10, and voted to affirm the appealed decision "in all other respects", with costs against
petitioner.
Air France contends that respondent knew that he did not have confirmed reservations for first
class on any specific flight, although he had tourist class protection; that, accordingly, the
issuance of a first class ticket was no guarantee that he would have a first class ride, but that such
would depend upon the availability of first class seats.

ISSUE:
Is Carrascoso entitled to damages?

RULING:
Yes. The manager not only prevented Carrascoso from enjoying his right to a first class seat;
worse, he imposed his arbitrary will; he forcibly ejected him from his seat, made him suffer the
humiliation of having to go to the tourist class compartment - just to give way to another
passenger whose right thereto has not been established. Certainly, this is bad faith. Unless, of
course, bad faith has assumed a meaning different from what is understood in law. For, "bad
faith" contemplates a "state of mind affirmatively operating with furtive design or with some
motive of self-interest or will or for ulterior purpose."

For the willful malevolent act of petitioner's manager, petitioner, his employer, must answer.
Article 21 of the Civil Code says:
ART. 21. Any person who willfully causes loss or injury to another in a manner that is contrary
to morals, good customs or public policy shall compensate the latter for the damage.

The contract of air carriage, therefore, generates a relation attended with a public duty. Neglect
or malfeasance of the carrier's employees, naturally, could give ground for an action for
damages.
Passengers do not contract merely for transportation. They have a right to be treated by the
carrier's employees with kindness, respect, courtesy and due consideration.

Although the relation of passenger and carrier is "contractual both in origin and nature"
nevertheless "the act that breaks the contract may be also a tort". The stress of Carrascoso's
action as we have said, is placed upon his wrongful expulsion. This is a violation of public duty
by the petitioner air carrier — a case of quasi-delict. Damages are proper. 
G.R. No. L-24837           June 27, 1968

JULIAN C. SINGSON and RAMONA DEL CASTILLO, plaintiffs,

vs.
BANK OF THE PHILIPPINE ISLANDS and SANTIAGO FREIXAS, in his capacity as
President of the said Bank, defendants.

FACTS:

Facts: Appeal by plaintiffs from a decision of the CFI Mla dismissing their complaint against
defendants.
On May 8, 1963, the Singsong commenced the present action against the Bank and its president,
Freixas, for damages in consequence of said illegal freezing of plaintiffs' account.
After appropriate proceedings, the CFI Mla rendered judgment dismissing the complaint upon
the ground that plaintiffs cannot recover from the defendants upon the basis of a quasi-delict,
because the relation between the parties is contractual in nature.

Issue: WON the existence of a contractual relation between the parties bar recovery of damages.

Ruling: The judgment appealed from is reversed holding defendant BPI to pay to the plaintiffs
nominal damages, and attorney's fees, apart from the costs.
The SC have repeatedly held that the existence of a contract between the parties does not bar the
commission of a tort by the one against the order and the consequent recovery of damages
therefore.
In view, of the facts obtaining in the case at bar, and considering, particularly, the circumstance,
that the wrong done to the plaintiff was remedied as soon as the President of the bank realized
the mistake they had committed, the Court finds that an award of nominal damages the amount
of which need not be proven in the sum of P1,000, in addition to attorney's fees in the sum of
P500, would suffice to vindicate plaintiff's rights.