POUSES DOMINGO and LOURDES PAGUYO, 

Petitioners, v. Pierre astorga and

St. Andrew Realty, Inc., Respondent.

DECISION

CHICO-NAZARIO, J.:

. . . Men may do foolish things, make ridiculous contracts, use miserable judgment,
and lose money by them - indeed, all they have in the world; but not for that alone
can the law intervene and restore. There must be, in addition, a violation of the law,
the commission of what the law knows as an actionable wrong, before the courts are
authorized to lay hold of the situation and remedy it. 1

The case at bar demonstrates a long drawn-out litigation between parties who
already entered into a valid contract that has subsisted for almost twenty (20) years
but one of them later balks from being bound by it, alleging fraud, gross inadequacy
of consideration, mistake, and undue influence.

This is a Petition for Review on Certiorari where petitioner Spouses Domingo and

Lourdes Paguyo seek the reversal of the Decision2 and the Resolution,3 dated 30
April 1997 and 12 September 1997, respectively, of the Court of Appeals in CA-G.R.
CV No. 47034, affirming in toto the Decision4 dated 21 April 1994 of the Regional
Trial Court (RTC), Branch 142 of Makati City.

The Antecedents

The undisputed facts, per summary of the Court of Appeals, follow.

Herein petitioners, Spouses Domingo Paguyo and Lourdes Paguyo, were the owners
of a small five-storey building known as the Paguyo Building located at Makati
Avenue, corner Valdez Street, Makati City. With one (1) unit per floor, the building
has an average area of 100 square meters per floor and is constructed on a land
belonging to the Armas family.5

This lot on which the Paguyo Building stands was the subject of Civil Case No. 5715
entitled, Armas, et al., v. Paguyo, et al., wherein the RTC of Makati City, Branch 57,
rendered a decision on 20 January 1988 approving a Compromise Agreement made
between the Armases and the petitioners. The compromise agreement provided that
in consideration of the total sum of One Million Seven Hundred Thousand Pesos
(P1,700,000.00), the Armases committed to execute in favor of petitioners a deed of
sale and/or conveyance assigning and transferring unto said petitioners all their
rights and interests over the parcel of land containing an area of 299 square
meters.6

In order for the petitioners to complete their title and ownership over the lot in
question, there was an urgent need to make complete payment to the Armases,
which at that time stood at P917,470.00 considering that petitioners had previously
made partial payments to the Armases.

On 29 November 1988, in order to raise the much needed amount, petitioner

Lourdes Paguyo entered into an agreement captioned as Receipt of Earnest
Money with respondent Pierre Astorga, for the sale of the former's property
consisting of the lot which was to be purchased from the Armases, together with the
improvements thereon, particularly, the existing building known as the Paguyo
Building, under the following terms and conditions as stated in the document, to wit:

RECEIVED from MR. PIERRE M. ASTORGA the sum of FIFTY THOUSAND

(P50,000.00) PESOS (U.C.P.B. Manager's Check No. 013085 dated November 29,
1988) as earnest money for the sale of our property consisting of a parcel of land
designated as Lot 12 located at Makati Avenue, Makati, Metro Manila, covered by
and described in T.C.T. No. 154806 together with the improvements thereon
particularly the existing building known as the Paguyo Bldg. under the following
terms and conditions:

1. The earnest money (Exh. "D") shall be good for fifteen (15) days from date of this
document during which period the owner is bound to sell the property to the buyer;

2. Should the buyer decide not to buy the subject property within the earnest/option
period, the seller has the right to forfeit Fifteen Thousand (P15,000.00) pesos, and
return the difference to the buyer;

3. The agreed total purchase price is seven million (P7,000,000.00) pesos Philippine
Currency;

4. Within fifteen (15) days from execution of this document, the buyer shall pay Fifty
(50%) percent of the total purchase price less the aforesaid earnest money, upon
payment of which the following documents shall be executed or caused to be
executed as the case may be, namely:

A. Deed of Absolute Sale of the Paguyo Bldg., in favor of the buyer.

b. Deed of Absolute Sale to be executed by the Armases who still appear as the
registered owners of the lot in favor of the buyer.

c. Deed of Real Estate Mortgage of the same subject lot and Bldg. to secure the 50%
balance of the total purchase price to be executed by the buyer in favor of the
herein seller.

5. The Deed of Real Estate Mortgage shall contain the following provisions, namely:

A. payment of the 50% balance of the purchase price shall be payable within fifteen
(15) days from actual vacating of the Armases from the subject lot.

b. During the period commencing from the execution of the documents mentioned
under paragraph 4 (which should be done simultaneously) the buyer is entitled to
one-half (1/2) of the rental due and actually received from the tenants of the
Paguyo Bldg. plus the use of the penthouse while the seller shall retain possession
and use of the basement free of rent until the balance of the purchase price is fully
paid in accordance with the herein terms and conditions. The one-half (1/2) of the
tenants' deposits shall be credited in favor of the buyer.7

However, contrary to their express representation with respect to the subject lot,
petitioners failed to comply with their obligation to acquire the lot from the Armas
family despite the full financial support of respondents. Nevertheless, the parties
maintained their business relationship under the terms and conditions of the above-
mentioned Receipt of Earnest Money.8
On 12 December 1988, petitioners asked for and were given by respondents an
additional P50,000.00 to meet the former's urgent need for money in connection
with their construction business. Due also to the urgent necessity of obtaining
money to finance their construction business, petitioner Lourdes Paguyo, who was
also the attorney-in-fact of her husband, proposed to the respondents the separate
sale of the building in question while she continued to work on the acquisition of the
lot from the Armas family, assuring the respondents that she would succeed in doing
so.9

Aware of the risk of buying an improvement on the lot of a third party who appeared
ambivalent on whether to dispose their property in favor of the respondents,
respondents took a big business gamble and, relying on the assurance of petitioners
that they would eventually acquire the lot and transfer the same to respondents in
accordance with their undertaking in the Receipt of Earnest Money, respondents
agreed to petitioner Lourdes Paguyo's proposal to buy the building first. Thus, on 5
January 1989, the parties executed the four documents in question namely, the
Deed of Absolute Sale of the Paguyo Building, the Mutual Undertaking, the Deed of
Real Estate Mortgage, and the Deed of Assignment of Rights and
Interest.10 Simultaneously with the signing of the four documents, respondents paid
petitioners the additional amount of P500,000.00.11 Thereafter, the respondents
renamed the Paguyo Building into GINZA Bldg. and registered the same in the name
of respondent St. Andrew Realty, Inc. at the Makati Assessor's Office after paying
accrued real estate taxes in the total amount of P169,174.95. Since 1990,
respondents paid the real estate taxes on subject building as registered owners
thereof. Further, respondents obtained fire insurance and applied for the conversion
of Paguyo Building into a condominium. All of these acts of ownership exercised by
respondents over the building were with the express knowledge and consent of the
petitioners.12

Pursuant to their agreement contained in the aforecited documents, particularly in

the Mutual Undertaking,13 respondent company filed an ejectment case and obtained
a favorable decision against petitioners in the Metropolitan Trial Court (MeTC) of
Makati in Civil Case No. 40050. The case reached this Court which affirmed the
decision of the MeTC in favor of respondent company. This decision had already
been executed and the respondent company is now in possession of the building.
Accordingly, respondents continued to exercise acts of full ownership, possession
and use over the building.14

On 06 October 1989, petitioners filed a Complaint for the rescission of the Receipt

of Earnest Money15 with the undertaking to return the sum of P763,890.50. They
also sought the rescission of the Deed of Real Estate Mortgage,16 the Mutual
Undertaking, the Deed of Absolute Sale of Building,17 and the Deed of
Assignment of Rights and Interest.18

In their complaint, petitioners alleged that respondents Astorga and St. Andrew
Realty, Inc., led them to believe that they would advance the P917,470.00, which
was needed by petitioners to complete payment with the Armases, with the
understanding that said amount would simply be deducted from the P7 Million total
consideration due them for the sale of the lot and the building as agreed upon in
their Receipt of Earnest Money. The same, however, did not materialize because
instead of making available the check for the said amount, respondents did not
produce the amount and even ordered the "stop payment" of the same before it
could be deposited in court.19
Respondents, in their Answer, however, interjected that as gleaned from
the Receipt of Earnest Money, the Mutual Undertaking, the Deed of
Assignment of Rights and Interest, their original intention was to purchase the
Paguyo Building and the lot on which it stands simultaneously. Respondents
interposed that at the time the decision on the compromise agreement between
petitioners and Armases was rendered, petitioners were badly in need of money
because they were financing their construction business and, with the balance
payable to the Armases, the former were in a huff to produce an amount sufficient
to cover both transactions. Thus, petitioners prevailed upon respondents to purchase
the Paguyo Building first with the lot to follow after petitioners have successfully
acquired it from the Armas family.

Respondents, likewise, stated in their Answer that sometime in July of 1989,

petitioners asked respondent corporation to execute a check in the amount
of P917,470.0020 for the final execution of the Deed of Conveyance of the lot, saying
that they were finally able to negotiate the purchase of the lot owned by the
Armases. To settle the transaction, respondent corporation again complied. After
investigation, however, respondents learned that petitioners were not in the position
to deliver the land, all the rights and interest thereof having allegedly been
transferred already to spouses Rodolfo and Aurora Bacani. They were able to
confirm this after obtaining a copy of a letter dated 22 September 1989 of
petitioners' counsel (same counsel representing them presently) to the Register of
Deeds of Makati a month prior to the filing of the instant case. The letter stated:

Ms. Mila Flores

Register of Deeds

Makati, Metro Manila

Dear Ms. Flores:

We represent the spouses Rodolfo and Aurora Bacani, who happen to be the

assignees of all the rights and interests that the couple Domingo and Lourdes
Paguyo have over that parcel of land located along Makati Avenue, the particulars
and description of which are indicated on TCT No. 154806 which, for reasons we
perceive to be not legitimate, was cancelled.

...

(SGD.) HECTOR B. ALMEYDA

For the Firm21

(Emphasis supplied.)

Respondents further explained in their Answer that because of this development,

they were constrained to order "stop payment" of the P917,470.00 check, which was
duly communicated to petitioners in a letter dated 14 July 1989, to wit:

I am very sorry to inform you that I have to stop payment on Philtrust Check No.
006759 because I was just reliably informed that you are no longer in a position to
deliver the lot subject of our agreement. While the financier had already advanced
half million pesos which was already placed in my account, I discouraged her from
putting another million pesos to cover my check with you. I therefore find myself
with no alternative but to order stop payment on my check to protect my rights and
interests.22

The Ruling of the Trial Court

After trial, the RTC ruled in favor of respondents in a Decision23 dated 21 April 1994,
the dispositive portion of which reads:

Judgment is hereby rendered dismissing the complaint for lack of cause of action,
the petition for preliminary injunction is hereby denied, judgment is rendered in
favor of the defendants and ordering the plaintiff spouses Domingo and Lourdes
Paguyo to pay the defendants Pierre Astorga and St. Andrew Realty, Inc. on their
counterclaim.

1. P400,000.00 for moral damages;

2. P200,000.00 as exemplary damages;

3. P100,00.00 for attorney's fees and litigation expenses and pay the cost of suit.24

The Ruling of the Court of Appeals

On appeal, the Court of Appeals promulgated its Decision25 dated 30 April 1997 in

CA-G.R. CV No. 47034 affirming the decision of the trial court, the dispositive
portion of which reads as follows:

WHEREFORE, We find the lower court's decision in full accord with the facts and the
law. Judgment is hereby rendered affirming the assailed decision dated April 21,
1994 in toto.26

Aggrieved by the ruling, petitioners elevated the matter to us via the instant

petition, contending that the Court of Appeals erred:

1. In concluding that the supposed acts of ownership and possession of respondents

preclude petitioners from seeking rescission and declaration of nullity of documents
signed and executed under mistaken premises that were not all true and accurate;

2. IN FAILING to find that fraud, mistake and undue influence had been exerted on
petitioner Lourdes Paguyo to make her a party to the assailed documents;

3. In reading the documents involved without regard to the contemporaneous acts

of the parties prior, during and immediately after the signing process;

4. In affirming the dismissal of the complaint; and cralawlibrary

5. In awarding damages and attorney's fees in favor of the respondents.27

The questions the Court is now tasked to answer are: (1) Did the Court of Appeals
err in upholding the trial court's decision denying petitioners' complaint for
rescission? (2) Was the award of damages and attorney's fees to respondents
proper?cralawlibrary
On the first issue, petitioners claim that the 05 January 1989 documents,
particularly the Deed of Absolute Sale of Building, Mutual Undertaking, Real Estate
Mortgage, and Assignment of Rights and Interests read together with the 29
November 1988 Receipt of Earnest Money, were all designed, per the respondents'
representations, to secure their exposure in the total sum of P763,890.50 which
constituted their outlay in the projected purchase of the Paguyo lot and building.

Respondents dispute petitioners' line of reasoning. They say that the Deed of
Absolute Sale over the building was absolute and unconditional.

Our Ruling

Petitioners' contentions lack merit.

The right to rescind a contract involving reciprocal obligations is provided for in

Article 1191 of the Civil Code. Article 1191 states: M

The power to rescind obligations is implied in reciprocal ones, in case one of the
obligors should not comply with what is incumbent upon him.

The injured party may choose between the fulfillment and the rescission of the
obligation, with the payment of damages in either case. He may also seek
rescission, even after he has chosen fulfillment, if the latter should become
impossible.

The court shall decree the rescission claimed, unless there be just cause authorizing
the fixing of a period.

This is understood to be without prejudice to the rights of third persons who have
acquired the thing, in accordance with Articles 1385 and 1388 and the Mortgage
Law.

The law speaks of the right of the "injured party" to choose between rescission or
fulfillment of the obligation, with the payment of damages in either case.28

Here, petitioners claim to be the injured party and consequently seek the rescission
of the Deed of Absolute Sale of the Building and the other documents in question.
Petitioners aver that they are entitled to cancel the Deed of Sale altogether in view
of fraud, gross inadequacy of price, mistake, and undue influence.

To boost their claim that the Deed of Absolute Sale was intended merely to
document the cash outlays of respondents, petitioners say that the P600,000.00
consideration as contained in the Deed of Absolute Sale of the 5-storey Paguyo
building is a far cry from the P3 Million valuation attached to it by respondent
Astorga himself and the building's fair market value of P2,848,000.00 assessed by
the Cuervo Appraisers, Inc.

We find no such inadequacy of consideration in the case at bar. For one, on top of

the P600,000.00 which petitioners received, respondents had to shoulder the
accrued real estate taxes of P169,174.95. For another, respondent Pierre Astorga
explained that said price was what St. Andrew Realty, Inc., believed as value for
their money inasmuch as the building stands on the lot owned by another and there
were separate owners of the land, who appear reluctant to sell it. For a third, said
amount was arrived at considering the depreciated value of the building and in view
of the economic and political uncertainties in the country at that time, marked by a
series of coup d etat, which caused real estate prices to plummet. Respondent
Astorga was explicit on this score'

ATTY. JOSE

Q: There was statement here by Mrs. Paguyo that this document entitled the deed of
absolute sale of a building marked Exhibit "9" was not expressive of the intention of
the parties meaning to say that she did not intend to sell the said building and one
of the reasons she tried to raise was the fact that the building was only sold for
P500,000.00, what can you say to that? cralawlibrary

A: Well, the P500,000.00 amount that she would want to impress to be an

inadequate amount is what we in St. Andrew's end believed as value for money for
the reason that the building stands on the lot she does not own and there
were separate owners and apparent conflict between them even the
seeming impossibility of getting the lot'

Q: By the way, before the plaintiffs decided to dispose the building or sell the
building by virtue of this deed of sale marked Exhibit "98" was your company ever
interested in acquiring the said building? cralawlibrary

A: The building alone, no. In fact, on December 21 when we had the problem as to
acquiring the lot, we did not part with any payment to Mrs. Paguyo demonstrating
that we had really and truly intended a simultaneous buy of the building and the lot
to acquire the property simultaneously the building and as well as the lot.

Q: Now, you mentioned that you are a realtor, I will ask you the same question,
which Atty. Almeyda asked me when I was on the witness stand, as a realtor will
you please tell the court what would be your appraisal of the value of the building? cralawlibrary

ATTY. COLOMA

- Objection, your Honor. May we know if the witness is going to express an opinion
or is he testifying now as an expert realtor? cralawlibrary

COURT

- As an opinion but it would not bind the Court.

WITNESS

- I can explain to you.

ATTY. JOSE

- Yes, please explain.

WITNESS

A: Okay, appraisal can take many forms if its appraised value based on the
construction cost it could be different from appraising per se the building. That is
now existing in that address also appraisal will depend on where the building is and
there is only one owner of the building and the lot. As the case here is, the building
in a manner of speaking stands on thin air. That is so including depreciation and
timing that we were doing in this transaction which was 1989, my appraisal will be
in the range of a Million may be.

Q: You made mentioned the word timing in 1989, why did you mention that? cralawlibrary

A: Well, '89 was not the best real estate year. In fact, we have a boom in 1988 but
prices were already deep during this year such that it is in 1988 when it could have
been another price. But this transaction happened or entered into in 1989, there
were no interested buyers during that time, sir.

Q: Why? cralawlibrary

A: coup de etat was one, and many other issue on hand that causes value to take
deep.

Q: You mentioned that word depreciation, will you please explain to us what that
depreciation has got to do with that building? cralawlibrary

A: In appraisal terms the building is in an economic line in every year of which a

certain value is allocated as depreciation for wear and tear for breakdowns and all
that is depreciation. This is deductible from the amount of the building (sic).

Q: Before you went into this agreement with the plaintiff Paguyo have you inspected
the building? cralawlibrary

A: Yes, sir. Thoroughly, sir.

Q: Will you please explain to the court the size of the building and the description of
the building? cralawlibrary

A: That building is five (5) storey it has only one (1) unit per floor, sir. There is a
narrow stairway that leads up to the penthouse. It is, I would say, in an advance
deteriorating stage, it needed some renovations here and there.29 (Emphasis
supplied.)

Moreover, Articles 1355 and 1470 of the Civil Code state:

Art. 1355. Except in cases specified by law, lesion or inadequacy of cause shall
not invalidate a contract, unless there has been fraud, mistake or undue
influence. (Emphasis supplied) ςrαlαωlιbrαrÿ

Art. 1470. Gross inadequacy of price does not affect a contract of sale, except

as may indicate a defect in the consent, or that the parties really intended a
donation or some other act or contract. (Emphasis supplied) ςrαlαωlιbrαrÿ

Petitioners herein failed to prove any of the instances mentioned in Articles 1355
and 1470 of the Civil Code, which would invalidate, or even affect, the Deed of Sale
of the Building and the related documents. Indeed, there is no requirement that the
price be equal to the exact value of the subject matter of sale.30
In Sps. Buenaventura v. Court of Appeals,31 the Court was unequivocal:

Courts cannot follow one every step of his life and extricate him from bad bargains,
protect him from unwise investments, relieve him from one-sided contracts, or annul
the effects of foolish acts. Courts cannot constitute themselves guardians of persons
who are not legally incompetent. Courts operate not because one person has been
defeated or overcome by another, but because he has been defeated or
overcome illegally. Men may do foolish things, make ridiculous contracts, use
miserable judgment, and lose money by them - indeed, all they have in the world;
but not for that alone can the law intervene and restore. There must be, in addition,
a violation of the law, the commission of what the law knows as
an actionable wrong, before the courts are authorized to lay hold of the situation
and remedy it. (Emphases in the original)

What is more, petitioners would wish to convince this Court that petitioner Lourdes
Paguyo was naïve enough to accept at face value the assurance of respondent
Astorga that the Deed of Sale was merely to document respondents' cash outlay.

Far from being the naïve and easy to fleece lady that she wants this Court to
perceive her to be, evidence on record reveals that petitioner Lourdes Paguyo is in
reality an astute businesswoman, having insured that legal minds would be available
at her disposal at the time she entered into the transactions she now impugns. As
she herself admitted in her testimony before the trial court, during her receipt of the
earnest money and during the transactions subject of the instant case, her lawyers,
one Atty. Lalin and a certain Atty. Cariño, assisted her. She testified as follows:

ATTY. JOSE

Wait, wait, your Honor. I have one question. Now, madam witness, you mentioned
that you were accompanied by a certain Atty. Molina when you executed the receipt
of the earnest money with me. Now, during the transaction of this subject matter,
you will also recall that at times you were represented in dealing with me as counsel
for defendant corporation by Atty. Lalin and Atty. Carino? cralawlibrary

A Yes, sir.32

Neither does the fact that the subject contracts have been prepared by
respondents ipso facto entail that their validity and legality be strictly interpreted
against them. Petitioner Lourdes Paguyo's insinuation that she was disadvantaged
will not hold. True, Article 24 of the New Civil Code provides that "(i)n all
contractual, property or other relations, when one of the parties is at a disadvantage
on account of his moral dependence, ignorance, indigence, mental weakness, tender
age or other handicap, the courts must be vigilant for his protection."33 Thus, the
validity and/or enforceability of the impugned contracts will have to be determined
by the peculiar circumstances obtaining in each case and the situation of the parties
concerned.

Here, petitioner Lourdes Paguyo, being not only cultured but a person with great
business acumen as well, cannot claim to be the weaker or disadvantaged party in
the subject contract so as to call for a strict interpretation against respondents. More
importantly, the parties herein went through a series of negotiations before the
documents were signed and executed.34
Further, we find the stipulations in the subject documents plain and unambiguous.
For instance, the Deed of Sale provides in no uncertain terms -

WHEREAS, the VENDOR is the true and absolute owner, free from any lien or
encumbrance, of a concrete building presently known as the Paguyo Building,
constructed on Lot 12, Blk. 4 (described in T.C.T No. 154806-Makati) located at No.
7856 Makati Ave. corner Valdez St., Makati, Metro Manila, covered by and described
in Tax Declaration No. 93762 for the year 1984, and more particularly described as
follows:

WHEREAS, the VENDOR is desirous of selling and the VENDEE is willing to buy the
aforedescribed building;

NOW THEREFORE, for and in consideration of the foregoing premises and of the sum
of SIX HUNDRED THOUSAND (P600,000.00) PESOS, Philippine currency, the receipt
of which is hereby acknowledged, the VENDOR hereby cedes, transfers, and
conveys, by way of absolute sale, unto and in favor of the VENDEE, his successors
and assigns, the aforementioned building with all the improvements therein.

The Municipal Assessor of Makati is therefore hereby authorized to register this sale
in the new Tax Declaration in the name of the VENDEE.

IN WITNESS WHEREOF, the VENDOR hereby affixed his signature by his wife and
attorney-in-fact, LOURDES S. Paguyo, this 5th day of January, 1989, in Pasay City.35

Inasmuch as the stipulations in the aforesaid contract and in the other contracts
being questioned leave no room for interpretation, there was no cause for applying
Article 24 of the New Civil Code.

In sum, in the case at bar, petitioners pray for rescission of the Deed of Sale of the
building and offer to repay the purchase price after their liquidity position would
have improved and after respondents would have refurbished the building, updated
the real property taxes, and turned the building into a profitable business venture.
This Court, however, will not allow itself to be an instrument to the dissolution of
contract validly entered into. A party should not, after its opportunity to enjoy the
benefits of an agreement, be allowed to later disown the arrangement when the
terms thereof ultimately would prove to operate against its hopeful
expectations.36On the matter of damages, the Court of Appeals affirmed the trial
court's award of damages and attorney's fees to respondents, namely P400,000 as
moral damages, P200,000 as exemplary damages, P100,000 as attorney's fees and
the costs of suit.We have held that moral damages may be recovered in cases where
one willfully causes injury to property, or in cases of breach of contract where the
other party acts fraudulently or in bad faith.37 There is no hard and fast rule in the
determination of what would be a fair amount of moral damages, since each case
must be governed by its own peculiar circumstances.38 Exemplary damages, on the
other hand, are imposed by way of example or correction for the public good,when
the party to a contract acts in a wanton, fraudulent, oppressive or malevolent
manner.39 Attorney's fees are allowed when exemplary damages are awarded and
when the party to a suit is compelled to incur expenses to protect his
interest.40While it has been sufficiently proven that the respondents are entitled to
damages, the actual amounts awarded by the lower court must be reduced because
damages are not intended for a litigant's enrichment, at the expense of the
petitioners.41 Judicial discretion granted to the courts in the assessment of damages
must always be exercised with balanced restraint and measured objectivity.42Thus,
the amount of moral damages should be set at only P30,000.00, and the award of
exemplary damages at only P20,000.00. The award of attorney's fees should also be
reduced to P20,000.00 which, under the circumstances of this case, appears justified
and reasonable.All told, we find no reason to reverse the assailed decision of
respondent court. The factual findings of the appellate court are conclusive on the
parties and carry greater weight when they coincide with the factual findings of the
trial court.43 This Court will not weigh the evidence anew lest there is a showing that
the findings of the lower court are totally devoid of support or are clearly erroneous
so as to constitute serious abuse of discretion. In the instant case, the trial court
found that the documents, which petitioners seek to rescind, were entered into as a
result of an arms-length transaction. These are factual findings that are now
conclusive upon us.44

WHEREFORE, the Decision and the Resolution dated 30 April 1997 and 12
September 1997, respectively, of the Court of Appeals in CA-G.R. CV No. 47034, are
hereby AFFIRMED with MODIFICATION as to the amount of damages and attorney's
fees recoverable, as follows: (1) moral

damages is reduced to P30,000.00, (2) exemplary damages is reduced

to P20,000.00, and (3) attorney's fees is reduced to P20,000.00. Costs against
petitioners.

SO ORDERED.

G.R. No. 164349             January 31, 2006

RADIO COMMUNICATIONS OF THE PHILIPPINES, INC. (RCPI),Petitioner,

vs.
ALFONSO VERCHEZ, GRACE VERCHEZ-INFANTE, MARDONIO INFANTE, ZENAIDA
VERCHEZ-CATIBOG, AND FORTUNATO CATIBOG, Respondents.

DECISION

CARPIO MORALES, J.:

On January 21, 1991, Editha Hebron Verchez (Editha) was confined at the Sorsogon Provincial
Hospital due to an ailment. On even date, her daughter Grace Verchez-Infante (Grace)
immediately hied to the Sorsogon Branch of the Radio Communications of the Philippines, Inc.
(RCPI) whose services she engaged to send a telegram to her sister Zenaida Verchez-Catibog
(Zenaida) who was residing at 18 Legal St., GSIS Village, Quezon City 1 reading: "Send check
money Mommy hospital." For RCPI’s services, Grace paid P10.502 for which she was issued a
receipt.3

As three days after RCPI was engaged to send the telegram to Zenaida no response was
received from her, Grace sent a letter to Zenaida, this time thru JRS Delivery Service,
reprimanding her for not sending any financial aid.

Immediately after she received Grace’s letter, Zenaida, along with her husband Fortunato
Catibog, left on January 26, 1991 for Sorsogon. On her arrival at Sorsogon, she disclaimed
having received any telegram.

In the meantime, Zenaida and her husband, together with her mother Editha left for Quezon City
on January 28, 1991 and brought Editha to the Veterans Memorial Hospital in Quezon City
where she was confined from January 30, 1991 to March 21, 1991.
The telegram was finally delivered to Zenaida 25 days later or on February 15, 1991. 4 On inquiry
from RCPI why it took that long to deliver it, a messenger of RCPI replied that he had nothing to
do with the delivery thereof as it was another messenger who previously was assigned to deliver
the same but the address could not be located, hence, the telegram was resent on February 2,
1991, and the second messenger finally found the address on February 15, 1991.

Editha’s husband Alfonso Verchez (Verchez), by letter of March 5, 1991, 5 demanded an

explanation from the manager of the Service Quality Control Department of the RCPI, Mrs. Lorna
D. Fabian, who replied, by letter of March 13, 1991, 6 as follows:

Our investigation on this matter disclosed that subject telegram was duly processed in
accordance with our standard operating procedure. However, delivery was not immediately
effected due to the occurrence of circumstances which were beyond the control and foresight of
RCPI. Among others, during the transmission process, the radio link connecting the points of
communication involved encountered radio noise and interferences such that subject telegram
did not initially registered (sic) in the receiving teleprinter machine.

Our internal message monitoring led to the discovery of the above. Thus, a repeat transmission
was made and subsequent delivery was effected. (Underscoring supplied)

Verchez’s lawyer thereupon wrote RCPI’s manager Fabian, by letter of July 23, 1991, 7 requesting
for a conference on a specified date and time, but no representative of RCPI showed up at said
date and time.

On April 17, 1992, Editha died.

On September 8, 1993, Verchez, along with his daughters Grace and Zenaida and their
respective spouses, filed a complaint against RCPI before the Regional Trial Court (RTC) of
Sorsogon for damages. In their complaint, the plaintiffs alleged that, inter alia, the delay in
delivering the telegram contributed to the early demise of the late Editha to their damage and
prejudice,8 for which they prayed for the award of moral and exemplary damages 9 and attorney’s
fees.10

After its motion to dismiss the complaint for improper venue11 was denied12 by Branch 5 of the
RTC of Sorsogon, RCPI filed its answer, alleging that except with respect to Grace, 13 the other
plaintiffs had no privity of contract with it; any delay in the sending of the telegram was due
to force majeure, "specifically, but not limited to, radio noise and interferences which adversely
affected the transmission and/or reception of the telegraphic message"; 14 the clause in the
Telegram Transmission Form signed by Grace absolved it from liability for any damage arising
from the transmission other than the refund of telegram tolls; 15 it observed due diligence in the
selection and supervision of its employees; and at all events, any cause of action had been
barred by laches.16

The trial court, observing that "although the delayed delivery of the questioned telegram was not
apparently the proximate cause of the death of Editha," ruled out the presence of force majeure.
Respecting the clause in the telegram relied upon by RCPI, the trial court held that it partakes of
the nature of a contract of adhesion.

Finding that the nature of RCPI’s business obligated it to dispatch the telegram to the addressee
at the earliest possible time but that it did not in view of the negligence of its employees to repair
its radio transmitter and the concomitant delay in delivering the telegram on time, the trial court,
upon the following provisions of the Civil Code, to wit:

Article 2176 – Whoever by act or omission causes damage to another, there being at 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 quasi-delict and is governed by the
provisions of this Chapter.

Article 1173 defines the fault of (sic) negligence of the obligor as the "omission of the diligence
which is required by the nature of the obligation and corresponds with the circumstances of the
person, of the time, or the place."

In the instant case, the obligation of the defendant to deliver the telegram to the addressee is of
an urgent nature. Its essence is the early delivery of the telegram to the concerned person. Yet,
due to the negligence of its employees, the defendant failed to discharge of its obligation on time
making it liable for damages under Article 2176.

The negligence on the part of the employees gives rise to the presumption of negligence on the
part of the employer.17 (Underscoring supplied),

rendered judgment against RCPI. Accordingly, it disposed:

WHEREFORE, in the light of the foregoing premises, judgment is hereby rendered in favor of the
plaintiffs and against the defendant, to wit:

Ordering the defendant to pay the plaintiffs the following amount:

1. The amount of One Hundred Thousand (P100,000.00) Pesos as moral damages;

2. The amount of Twenty Thousand (P20,000.00) Pesos as attorney’s fees; and

3. To pay the costs.

SO ORDERED.18

On appeal, the Court of Appeals, by Decision of February 27, 2004, 19 affirmed the trial court’s
decision.

Hence, RCPI’s present petition for review on certiorari, it raising the following questions: (1) "Is
the award of moral damages proper even if the trial court found that there was no direct
connection between the injury and the alleged negligent acts?"20 and (2) "Are the stipulations in
the ‘Telegram Transmission Form,’ in the nature "contracts of adhesion" (sic)?21

RCPI insists that respondents failed to prove any causal connection between its delay in
transmitting the telegram and Editha’s death.22

RCPI’s stand fails. It bears noting that its liability is anchored on culpa contractual or breach of
contract with regard to Grace, and on tort with regard to her co-plaintiffs-herein-co-respondents.

Article 1170 of the Civil Code provides:

Those who in the performance of their obligations are guilty of fraud, negligence, or delay, and
those who in any manner contravene the tenor thereof, are liable for damages. (Underscoring
supplied)

Passing on this codal provision, this Court explained:

In culpa contractual x x x the mere proof of the existence of the contract and the failure of its
compliance justify, prima facie, a corresponding right of relief. The law, recognizing the obligatory
force of contracts, will not permit a party to be set free from liability for any kind of
misperformance of the contractual undertaking or a contravention of the tenor thereof. A breach
upon the contract confers upon the injured party a valid cause for recovering that which may
have been lost or suffered. The remedy serves to preserve the interests of the promissee that
may include his "expectation interest," which is his interest in having the benefit of his bargain
by being put in as good a position as he would have been in had the contract been performed, or
his "reliance interest," which is his interest in being reimbursed for loss caused by reliance on
the contract by being put in as good a position as he would have been in had the contract not
been made; or his "restitution interest," which is his interest in having restored to him any
benefit that he has conferred on the other party. Indeed, agreements can accomplish little, either
for their makers or for society, unless they are made the basis for action. The effect of every
infraction is to create a new duty, that is, to make recompense to the one who has been injured
by the failure of another to observe his contractual obligation unless he can show extenuating
circumstances, like proof of his exercise of due diligence x x x or of the attendance of
fortuitous event, to excuse him from his ensuing liability.23 (Emphasis and underscoring
supplied)

In the case at bar, RCPI bound itself to deliver the telegram within the shortest possible time. It
took 25 days, however, for RCPI to deliver it.

RCPI invokes force majeure, specifically, the alleged radio noise and interferences which
adversely affected the transmission and/or reception of the telegraphic message. Additionally, its
messenger claimed he could not locate the address of Zenaida and it was only on the third
attempt that he was able to deliver the telegram.

For the defense of force majeure to prosper,

x x x it is necessary that one has committed no negligence or misconduct that may have

occasioned the loss. An act of God cannot be invoked to protect a person who has failed to take
steps to forestall the possible adverse consequences of such a loss. One’s negligence may have
concurred with an act of God in producing damage and injury to another; nonetheless, showing
that the immediate or proximate cause of the damage or injury was a fortuitous event would not
exempt one from liability. When the effect is found to be partly the result of a person’s
participation – whether by active intervention, neglect or failure to act – the whole
occurrence is humanized and removed from the rules applicable to acts of God.

xxxx

Article 1174 of the Civil Code states that no person shall be responsible for a fortuitous event that
could not be foreseen or, though foreseen, was inevitable. In other words, there must be an
exclusion of human intervention from the cause of injury or loss.24 (Emphasis and
underscoring supplied)

Assuming arguendo that fortuitous circumstances prevented RCPI from delivering the telegram

at the soonest possible time, it should have at least informed Grace of the non-transmission and
the non-delivery so that she could have taken steps to remedy the situation. But it did not. There
lies the fault or negligence.

In an earlier case also involving RCPI, this Court held:

Considering the public utility of RCPI’s business and its contractual obligation to transmit
messages, it should exercise due diligence to ascertain that messages are delivered to the
persons at the given address and should provide a system whereby in cases of undelivered
messages the sender is given notice of non-delivery. Messages sent by  cable or wireless
means are usually more important and urgent than those which can wait for the mail.25
 xxxx

People depend on telecommunications companies in times of deep emotional stress or

pressing financial needs. Knowing that messages about the illnesses or deaths of loved ones,
births or marriages in a family, important business transactions, and notices of conferences or
meetings as in this case, are coursed through the petitioner and similar corporations, it is
incumbent upon them to exercise a greater amount of care and concern than that shown in this
case. Every reasonable effort to inform senders of the non-delivery of messages should be
undertaken.26

(Emphasis and underscoring supplied)

RCPI argues, however, against the presence of urgency in the delivery of the telegram, as well
as the basis for the award of moral damages, thus:27

The request to send check as written in the telegraphic text negates the existence of
urgency that private respondents’ allegations that ‘time was of the essence’ imports. A check
drawn against a Manila Bank and transmitted to Sorsogon, Sorsogon will have to be deposited in
a bank in Sorsogon and pass thru a minimum clearing period of 5 days before it may be
encashed or withdrawn. If the transmittal of the requested check to Sorsogon took 1 day –
private respondents could therefore still wait for 6 days before the same may be withdrawn.
Requesting a check that would take 6 days before it could be withdrawn therefore contradicts
plaintiff’s claim of urgency or need.28

At any rate, any sense of urgency of the situation was met when Grace Verchez was able to
communicate to Manila via a letter  that she sent to the same addressee in Manila thru JRS.29

xxxx

As far as the respondent court’s award for moral damages is concerned, the same has no
basis whatsoever since private respondent Alfonso Verchez did not accompany his late wife
when the latter went to Manila by bus. He stayed behind in Sorsogon for almost 1 week before
he proceeded to Manila. 30

When pressed on cross-examination, private respondent Alfonso Verchez could not give any
plausible reason as to the reason why he did not accompany his ailing wife to Manila. 31

xxxx

It is also important to consider in resolving private respondents’ claim for moral damages that
private respondent Grace Verchez did not accompany her ailing mother to Manila.32

xxxx

It is the common reaction of a husband to be at his ailing wife’s side as much as possible. The
fact that private respondent Alfonso Verchez stayed behind in Sorsogon for almost 1 week
convincingly demonstrates that he himself knew that his wife was not in critical condition.33

(Emphasis and underscoring supplied)

RCPI’s arguments fail. For it is its breach of contract upon which its liability is, it bears repeating,
anchored. Since RCPI breached its contract, the presumption is that it was at fault or negligent.
It, however, failed to rebut this presumption.

For breach of contract then, RCPI is liable to Grace for damages.

And for quasi-delict, RCPI is liable to Grace’s co-respondents following Article 2176 of the Civil
Code which 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. (Underscoring supplied)

RCPI’s liability as an employer could of course be avoided if it could prove that it observed the
diligence of a good father of a family to prevent damage. Article 2180 of the Civil Code so
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.

xxxx

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.

xxxx

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

RCPI failed, however, to prove that it observed all the diligence of a good father of a family to
prevent damage.

Respecting the assailed award of moral damages, a determination of the presence of the
following requisites to justify the award is in order:

x x x firstly, evidence of besmirched reputation or physical, mental or psychological suffering

sustained by the claimant; secondly, a culpable act or omission factually established; thirdly,
proof that the wrongful act or omission of the defendant is the proximate cause of damages
sustained by the claimant; and fourthly, that the case is predicated on any of the instances
expressed or envisioned by Article 2219 and Article 2220 of the Civil Code. 34

Respecting the first requisite, evidence of suffering by the plaintiffs-herein respondents was
correctly appreciated by the CA in this wise:

The failure of RCPI to deliver the telegram containing the message of appellees on time,
disturbed their filial tranquillity. Family members blamed each other for failing to respond swiftly
to an emergency that involved the life of the late Mrs. Verchez, who suffered from diabetes. 35

As reflected in the foregoing discussions, the second and third requisites are present.

On the fourth requisite, Article 2220 of the Civil Code provides:

Willful injury to property may be a legal ground for awarding moral damages if the court should
find that, under the circumstances, such damages are justly due. The same rule applies
to breaches of contract where the defendant acted fraudulently or in bad faith. (Emphasis
and underscoring supplied)

After RCPI’s first attempt to deliver the telegram failed, it did not inform Grace of the non-delivery
thereof and waited for 12 days before trying to deliver it again, knowing – as it should know – that
time is of the essence in the delivery of telegrams. When its second long-delayed attempt to
deliver the telegram again failed, it, again, waited for another 12 days before making a third
attempt. Such nonchalance in performing its urgent obligation indicates gross negligence
amounting to bad faith. The fourth requisite is thus also present.

In applying the above-quoted Article 2220, this Court has awarded moral damages in cases of
breach of contract where the defendant was guilty of gross negligence amounting to bad faith, or
in wanton disregard of his contractual obligation. 36

As for RCPI’s tort-based liability, Article 2219 of the Civil Code provides:

Moral damages may be recovered in the following and analogous cases:

xxxx

(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35. (Emphasis
supplied)

Article 26 of the Civil Code, in turn, provides:

Every person shall respect the dignity, personality, privacy and peace of mind of his neighbors
and other persons. The following and similar acts, though they may not constitute a criminal
offense, shall produce a cause of action for damages, prevention, and other relief:

xxxx

(2) Meddling with or disturbing the private life or family relations of another. (Emphasis
supplied)

RCPI’s negligence in not promptly performing its obligation undoubtedly disturbed the peace of
mind not only of Grace but also her co-respondents. As observed by the appellate court, it
disrupted the "filial tranquillity" among them as they blamed each other "for failing to respond
swiftly to an emergency." The tortious acts and/or omissions complained of in this case are,
therefore, analogous to acts mentioned under Article 26 of the Civil Code, which are among the
instances of quasi-delict when courts may award moral damages under Article 2219 of the Civil
Code.

In fine, the award to the plaintiffs-herein respondents of moral damages is in order, as is the
award of attorney’s fees, respondents having been compelled to litigate to protect their rights.

Clutching at straws, RCPI insists that the limited liability clause in the "Telegram Transmission
Form" is not a contract of adhesion. Thus it argues:

Neither can the Telegram Transmission Form be considered a contract of adhesion as held by
the respondent court. The said stipulations were all written in bold letters right in front of the
Telegram Transmission Form. As a matter of fact they were beside the space where the
telegram senders write their telegraphic messages. It would have been different if the stipulations
were written at the back for surely there is no way the sender will easily notice them. The
fact that the stipulations were located in a particular space where they can easily be seen, is
sufficient notice to any sender (like Grace Verchez-Infante) where she could manifest her
disapproval, leave the RCPI station and avail of the services of the other telegram
operators.37 (Underscoring supplied)

RCPI misunderstands the nature of a contract of adhesion. Neither the readability of the
stipulations nor their physical location in the contract determines whether it is one of adhesion.

A contract of adhesion is defined as one in which one of the parties imposes a ready-made form
of contract, which the other party may accept or reject, but which the latter cannot modify. One
party prepares the stipulation in the contract, while the other party merely affixes his signature or
his "adhesion" thereto, giving no room for negotiation and depriving the latter of the
opportunity to bargain on equal footing.38 (Emphasis and underscoring supplied)

While a contract of adhesion is not necessarily void and unenforceable, since it is construed
strictly against the party who drafted it or gave rise to any ambiguity therein, it is stricken down as
void and unenforceable or subversive of public policy when the weaker party is imposed upon in
dealing with the dominant bargaining party and is reduced to the alternative of taking it or leaving
it, completely deprived of the opportunity to bargain on equal footing. 39

This Court holds that the Court of Appeals’ finding that the parties’ contract is one of adhesion
which is void is, given the facts and circumstances of the case, thus well-taken.

WHEREFORE, the petition is DENIED, and the challenged decision of the Court of Appeals
is AFFIRMED.

Costs against petitioner.

SO ORDERED.

G.R. No. 179736, June 26, 2013

SPOUSES BILL AND VICTORIA HING, Petitioners, v. ALEXANDER CHOACHUY,

SR. AND ALLAN CHOACHUY, Respondents.

DECISION

DEL CASTILLO, J.:

“The concept of liberty would be emasculated if it does not likewise compel respect
for [one’s] personality as a unique individual whose claim to privacy and [non]-
interference demands respect.”1

This Petition for Review on Certiorari2 under Rule 45 of the Rules of Court assails the
July 10, 2007 Decision3 and the September 11, 2007 Resolution4 of the Court of
Appeals (CA) in CA-G.R. CEB-SP No. 01473.

Factual Antecedents

On August 23, 2005, petitioner-spouses Bill and Victoria Hing filed with the Regional
Trial Court (RTC) of Mandaue City a Complaint5 for Injunction and Damages with
prayer for issuance of a Writ of Preliminary Mandatory Injunction/Temporary
Restraining Order (TRO), docketed as Civil Case MAN-5223 and raffled to Branch 28,
against respondents Alexander Choachuy, Sr. and Allan Choachuy.
Petitioners alleged that they are the registered owners of a parcel of land (Lot 1900-
B) covered by Transfer Certificate of Title (TCT) No. 42817 situated in Barangay
Basak, City of Mandaue, Cebu;6 that respondents are the owners of Aldo
Development & Resources, Inc. (Aldo) located at Lots 1901 and 1900-C, adjacent to
the property of petitioners;7 that respondents constructed an auto-repair shop
building (Aldo Goodyear Servitec) on Lot 1900-C; that in April 2005, Aldo filed a
case against petitioners for Injunction and Damages with Writ of Preliminary
Injunction/TRO, docketed as Civil Case No. MAN-5125;8 that in that case, Aldo
claimed that petitioners were constructing a fence without a valid permit and that
the said construction would destroy the wall of its building, which is adjacent to
petitioners’ property;9 that the court, in that case, denied Aldo’s application for
preliminary injunction for failure to substantiate its allegations;10 that, in order to get
evidence to support the said case, respondents on June 13, 2005 illegally set-up and
installed on the building of Aldo Goodyear Servitec two video surveillance cameras
facing petitioners’ property;11 that respondents, through their employees and
without the consent of petitioners, also took pictures of petitioners’ on-going
construction;12 and that the acts of respondents violate petitioners’ right to
privacy.13  Thus, petitioners prayed that respondents be ordered to remove the video
surveillance cameras and enjoined from conducting illegal surveillance.14

In their Answer with Counterclaim,15 respondents claimed that they did not install
the video surveillance cameras,16 nor did they order their employees to take pictures
of petitioners’ construction.17 They also clarified that they are not the owners of Aldo
but are mere stockholders.18

Ruling of the Regional Trial Court

On  October 18, 2005,  the RTC issued an Order19  granting the application for a
TRO.  The dispositive portion of the said Order reads: cralavvonlinelawlibrary

WHEREFORE, the application for a [T]emporary [R]estraining [O]rder or a [W]rit of

[P]reliminary [I]njunction is granted.  Upon the filing and approval of a bond by
[petitioners], which the Court sets at P50,000.00, let a [W]rit of [P]reliminary
[I]njunction issue against the [respondents] Alexander Choachuy, Sr. and Allan
Choachuy. They are hereby directed to immediately remove the revolving camera
that they installed at the left side of their building overlooking the side of
[petitioners’] lot and to transfer and operate it elsewhere at the back where
[petitioners’] property can no longer be viewed within a distance of about 2-3
meters from the left corner of Aldo Servitec, facing the road.

IT IS SO ORDERED.20

Respondents moved for a reconsideration21 but the RTC denied the same in its
Order22 dated February 6, 2006.23  Thus: cralavvonlinelawlibrary

WHEREFORE, the Motion for Reconsideration is hereby DENIED for lack of merit. 
Issue a [W]rit of [P]reliminary [I]njunction in consonance with the Order dated 18
October 2005.

IT IS SO ORDERED.24 nadcralavvonlinelawlibrary

Aggrieved, respondents filed with the CA a Petition for Certiorari25 under Rule 65 of

the Rules of Court with application for a TRO and/or Writ of Preliminary Injunction.
Ruling of the Court of Appeals

On July 10, 2007, the CA issued its Decision26 granting the Petition for Certiorari. 
The CA ruled that the Writ of Preliminary Injunction was issued with grave abuse of
discretion because petitioners failed to show a clear and unmistakable right to an
injunctive writ.27  The CA explained that the right to privacy of residence under
Article 26(1) of the Civil Code was not violated since the property subject of the
controversy is not used as a residence.28  The CA also said that since respondents
are not the owners of the building, they could not have installed video surveillance
cameras.29  They are mere stockholders of Aldo, which has a separate juridical
personality.30  Thus, they are not the proper parties.31  The fallo reads: cralavvonlinelawlibrary

WHEREFORE, in view of the foregoing premises, judgment is hereby rendered by

us GRANTING the petition filed in this case. The assailed orders dated October 18,
2005 and February 6, 2006 issued by the respondent judge are
hereby ANNULLED and SET ASIDE.

SO ORDERED.32 nadcralavvonlinelawlibrary

Issues

Hence, this recourse by petitioners arguing that: cralavvonlinelawlibrary

I.

THE X X X [CA] COMMITTED A REVERSIBLE ERROR WHEN IT ANNULLED AND SET

ASIDE THE ORDERS OF THE [RTC] DATED 18 OCTOBER 2005 AND 6 FEBRUARY
2006 HOLDING THAT THEY WERE ISSUED WITH GRAVE ABUSE OF DISCRETION.

II.

THE X X X [CA] COMMITTED A REVERSIBLE ERROR WHEN IT RULED THAT

PETITIONER SPOUSES HING ARE NOT ENTITLED TO THE WRIT OF PRELIMINARY
INJUNCTION ON THE GROUND THAT THERE IS NO VIOLATION OF THEIR
CONSTITUTIONAL AND CIVIL RIGHT TO PRIVACY DESPITE THE FACTUAL FINDINGS
[OF] THE RTC, WHICH RESPONDENTS CHOACHUY FAILED TO REFUTE, THAT THE
ILLEGALLY INSTALLED SURVEILLANCE CAMERAS OF RESPONDENTS CHOACH[U]Y
WOULD CAPTURE THE PRIVATE ACTIVITIES OF PETITIONER SPOUSES HING, THEIR
CHILDREN AND EMPLOYEES.

III.

THE X X X [CA] COMMITTED A REVERSIBLE ERROR WHEN IT RULED THAT SINCE

THE OWNER OF THE BUILDING IS ALDO DEVELOPMENT AND RESOURCES, INC.
THEN TO SUE RESPONDENTS CHOACHUY CONSTITUTE[S] A PURPORTEDLY
UNWARRANTED PIERCING OF THE CORPORATE VEIL.

IV. 

THE X X X [CA] COMMITTED A REVERSIBLE ERROR WHEN IT IGNORED THE

SERIOUS FORMAL DEFICIENCIES OF BOTH THE PETITION AND THE MOTION FOR
RECONSIDERATION DATED 15 MARCH 2006 OF RESPONDENT[S] CHOACH[U]Y AND
GAVE X X X THEM DUE COURSE AND CONSIDERATION.33
Essentially, the issues boil down to (1) whether there is a violation of petitioners’
right to privacy, and (2) whether respondents are the proper parties to this suit.

Petitioners’ Arguments

Petitioners insist that they are entitled to the issuance of a Writ of Preliminary
Injunction because respondents’ installation of a stationary camera directly facing
petitioners’ property and a revolving camera covering a significant portion of the
same property constitutes a violation of petitioners’ right to privacy.34  Petitioners
cite Article 26(1) of the Civil Code, which enjoins persons from prying into the
private lives of others.35 Although the said provision pertains to the privacy of
another’s residence, petitioners opine that it includes business offices, citing
Professor Arturo M. Tolentino.36  Thus, even assuming arguendo that petitioners’
property is used for business, it is still covered by the said provision.37

As to whether respondents are the proper parties to implead in this case, petitioners
claim that respondents and Aldo are one and the same, and that respondents only
want to hide behind Aldo’s corporate fiction.38  They point out that if respondents are
not the real owners of the building, where the video surveillance cameras were
installed, then they had no business consenting to the ocular inspection conducted
by the court.39

Respondents’ Arguments

Respondents, on the other hand, echo the ruling of the CA that petitioners cannot
invoke their right to privacy since the property involved is not used as a
residence.40 Respondents maintain that they had nothing to do with the installation
of the video surveillance cameras as these were installed by Aldo, the registered
owner of the building,41 as additional security for its building. 42 Hence, they were
wrongfully impleaded in this case.43

Our Ruling

The Petition is meritorious.

The right to privacy is the right to be let alone. 

The right to privacy is enshrined in our Constitution44 and in our laws.  It is defined

as “the right to be free from unwarranted exploitation of one’s person or from
intrusion into one’s private activities in such a way as to cause humiliation to a
person’s ordinary sensibilities.”45  It is the right of an individual “to be free from
unwarranted publicity, or to live without unwarranted interference by the public in
matters in which the public is not necessarily concerned.”46  Simply put, the right to
privacy is “the right to be let alone.”47

The Bill of Rights guarantees the people’s right to privacy and protects them against
the State’s abuse of power.  In this regard, the State recognizes the right of the
people to be secure in their houses.  No one, not even the State, except “in case of
overriding social need and then only under the stringent procedural safeguards,” can
disturb them in the privacy of their homes.48

The right to privacy under Article 26(1)

of the Civil Code covers business offices
where the public are excluded therefrom
and only certain individuals are allowed
to enter.

Article 26(1) of the Civil Code, on the other hand, protects an individual’s right to
privacy and provides a legal remedy against abuses that may be committed against
him by other individuals.  It states: cralavvonlinelawlibrary

Art. 26.  Every person shall respect the dignity, personality, privacy and peace of
mind of his neighbors and other persons.  The following and similar acts, though
they may not constitute a criminal offense, shall produce a cause of action for
damages, prevention and other relief: cralavvonlinelawlibrary

(1)  Prying into the privacy of another’s residence; chanroblesvirtualawlibrary

xxxx

This provision recognizes that a man’s house is his castle, where his right to privacy
cannot be denied or even restricted by others. It includes “any act of intrusion into,
peeping or peering inquisitively into the residence of another without the consent of
the latter.”49  The phrase “prying into the privacy of another’s residence,” however,
does not mean that only the residence is entitled to privacy.  As elucidated by Civil
law expert Arturo M. Tolentino: cralavvonlinelawlibrary

Our Code specifically mentions “prying into the privacy of another’s residence.”  This
does not mean, however, that only the residence is entitled to privacy, because the
law covers also “similar acts.”  A business office is entitled to the same privacy
when the public is excluded therefrom and only such individuals as are
allowed to enter may come in.  x x x50  (Emphasis supplied)

Thus, an individual’s right to privacy under Article 26(1) of the Civil Code should not
be confined to his house or residence as it may extend to places where he has the
right to exclude the public or deny them access.  The phrase “prying into the privacy
of another’s residence,” therefore, covers places, locations, or even situations which
an individual considers as private.  And as long as his right is recognized by society,
other individuals may not infringe on his right to privacy.  The CA, therefore, erred
in limiting the application of Article 26(1) of the Civil Code only to residences.

The “reasonable expectation of privacy”

test is used to determine whether there
is a violation of the right to privacy.

In ascertaining whether there is a violation of the right to privacy, courts use the
“reasonable expectation of privacy” test.  This test determines whether a person has
a reasonable expectation of privacy and whether the expectation has been
violated.51  In Ople v. Torres,52 we enunciated that “the reasonableness of a person’s
expectation of privacy depends on a two-part test: (1) whether, by his conduct, the
individual has exhibited an expectation of privacy; and (2) this expectation is one
that society recognizes as reasonable.”  Customs, community norms, and practices
may, therefore, limit or extend an individual’s “reasonable expectation of privacy.”53 
Hence, the reasonableness of a person’s expectation of privacy must be determined
on a case-to-case basis since it depends on the factual circumstances surrounding
the case.54
In this day and age, video surveillance cameras are installed practically everywhere
for the protection and safety of everyone.  The installation of these cameras,
however, should not cover places where there is reasonable expectation of privacy,
unless the consent of the individual, whose right to privacy would be affected, was
obtained.  Nor should these cameras be used to pry into the privacy of another’s
residence or business office as it would be no different from eavesdropping, which is
a crime under Republic Act No. 4200 or the Anti-Wiretapping Law.

In this case, the RTC, in granting the application for Preliminary Injunction, ruled
that:cralavvonlinelawlibrary

After careful consideration, there is basis to grant the application for a temporary
restraining order. The operation by [respondents] of a revolving camera, even if it
were mounted on their building, violated the right of privacy of [petitioners], who
are the owners of the adjacent lot.  The camera does not only focus on
[respondents’] property or the roof of the factory at the back (Aldo Development
and Resources, Inc.) but it actually spans through a good portion of [the] land of
[petitioners].

Based on the ocular inspection, the Court understands why [petitioner] Hing was so
unyielding in asserting that the revolving camera was set up deliberately to monitor
the on[-]going construction in his property.  The monitor showed only a portion of
the roof of the factory of [Aldo].  If the purpose of [respondents] in setting up a
camera at the back is to secure the building and factory premises, then the camera
should revolve only towards their properties at the back. [Respondents’] camera
cannot be made to extend the view to [petitioners’] lot.  To allow the [respondents]
to do that over the objection of the [petitioners] would violate the right of
[petitioners] as property owners.  “The owner of a thing cannot make use thereof in
such a manner as to injure the rights of a third person.”55

The RTC, thus, considered that petitioners have a “reasonable expectation of

privacy” in their property, whether they use it as a business office or as a residence
and that the installation of video surveillance cameras directly facing petitioners’
property or covering a significant portion thereof, without their consent, is a clear
violation of their right to privacy.  As we see then, the issuance of a preliminary
injunction was justified.  We need not belabor that the issuance of a preliminary
injunction is discretionary on the part of the court taking cognizance of the case and
should not be interfered with, unless there is grave abuse of discretion committed by
the court.56  Here, there is no indication of any grave abuse of discretion.  Hence,
the CA erred in finding that petitioners are not entitled to an injunctive writ.

This brings us to the next question: whether respondents are the proper parties to
this suit.

A real party defendant is one who has a

correlative legal obligation to redress
a wrong done to the plaintiff by reason
of the defendant's act or omission which
had violated the legal right of the former.

Section 2, Rule 3 of the Rules of Court provides: cralavvonlinelawlibrary

SEC. 2. Parties-in-interest. — A real party-in-interest is the party who stands to be

benefited or injured by the judgment in the suit, or the party entitled to the avails of
the suit. Unless otherwise authorized by law or these Rules, every action must be
prosecuted or defended in the name of the real party-in-interest.

A real party defendant is “one who has a correlative legal obligation to redress a
wrong done to the plaintiff by reason of the defendant’s act or omission which had
violated the legal right of the former.”57

In ruling that respondents are not the proper parties, the CA reasoned that since
they do not own the building, they could not have installed the video surveillance
cameras.58  Such reasoning, however, is erroneous.  The fact that respondents are
not the registered owners of the building does not automatically mean that they did
not cause the installation of the video surveillance cameras.

In their Complaint, petitioners claimed that respondents installed the video

surveillance cameras in order to fish for evidence, which could be used against
petitioners in another case.59  During the hearing of the application for Preliminary
Injunction, petitioner Bill testified that when respondents installed the video
surveillance cameras, he immediately broached his concerns but they did not seem
to care,60 and thus, he reported the matter to the barangay for mediation, and
eventually, filed a Complaint against respondents before the RTC.61  He also
admitted that as early as 1998 there has already been a dispute between his family
and the Choachuy family concerning the boundaries of their respective properties.62 
With these factual circumstances in mind, we believe that respondents are the
proper parties to be impleaded.

Moreover, although Aldo has a juridical personality separate and distinct from its
stockholders, records show that it is a family-owned corporation managed by the
Choachuy family.63

Also quite telling is the fact that respondents, notwithstanding their claim that they
are not owners of the building, allowed the court to enter the compound of Aldo and
conduct an ocular inspection. The counsel for respondents even toured Judge
Marilyn Lagura-Yap inside the building and answered all her questions regarding the
set-up and installation of the video surveillance cameras.64 And when respondents
moved for reconsideration of the Order dated October 18, 2005 of the RTC, one of
the arguments they raised is that Aldo would suffer damages if the video
surveillance cameras are removed and transferred.65  Noticeably, in these instances,
the personalities of respondents and Aldo seem to merge.

All these taken together lead us to the inevitable conclusion that respondents are
merely using the corporate fiction of Aldo as a shield to protect themselves from this
suit.  In view of the foregoing, we find that respondents are the proper parties to
this suit.

WHEREFORE, the Petition is hereby GRANTED.  The Decision dated July 10, 2007
and the Resolution dated September 11, 2007 of the Court of Appeals in CA-G.R.
CEB-SP No. 01473 are hereby REVERSED and SET ASIDE. The Orders dated
October 18, 2005 and February 6, 200[6] of Branch 28 of the Regional Trial Court of
Mandaue City in Civil Case No. MAN-5223 are
hereby REINSTATED and AFFIRMED.

SO ORDERED.

Carpio, (Chairperson), Brion, Perez, and Perlas-Bernabe, JJ., concur.

G.R. No. L-54598 April 15, 1988

JOSE B. LEDESMA, petitioner,
vs.
HON. COURT OF APPEALS, Spouses PACIFICO DELMO and SANCHA DELMO (as private
respondents), respondents.

The Solicitor General for petitioner.

Luzel D. Demasu-ay for respondent.

GUTIERREZ, JR., J.:

This petition seeks to reverse the decision of the respondent Court of Appeals which afirmed the decision of the Court of First Instance
of Iloilo, adjudging the petitioner, who was then the President of the West Visayas College liable for damages under Article 27 of the
Civil Code of the Philippines for failure to graduate a student with honors.

The facts are not disputed.

An organization named Student Leadership Club was formed by some students of the West
Visayas College. They elected the late Violets Delmo as the treasurer. In that capacity, Delmo
extended loans from the funds of the club to some of the students of the school. "the petitioner
claims that the said act of extending loans was against school rules and regulations. Thus, the
petitioner, as President of the School, sent a letter to Delmo informing her that she was being
dropped from the membership of the club and that she would not be a candidate for any award
or citation from the school.

Delmo asked for a reconsideration of the decision but the petitioner denied it. Delmo, thus,
appealed to the Office of the Director of the Bureau of Public Schools.

The Director after due investigation, rendered a decison on April 13, 1966 which provided:

Records of the preliminary investigation conducted by one of the legal officers of

this Office disclosed the following: That Violeta Delmo was the treasurer of the
Student Leadership Club, an exclusive student organization; that pursuant to
Article IX of the of the Constitution and By-Laws of the club, it passed Resolution
No. 2, authorizing the treasurer to disburse funds of the Club to student for
financial aid and other humanitarian purposes; that in compliance with said
resolution and as treasurer of the Club, Violeta Delmo extended loans to some
officers and members of the Club upon proper application duly approved by the
majority of the members of the Executive Board; and that upon receiving the
report from Mr. Jesse Dagoon, adviser of the funds of the Club, that Office
conducted an investigation on the matter and having been convinced of the guilt
of Violets Delmo and the other officers and members of the Club, that Office
rendered the order or decision in question. In justifying that Office's order or
decision, it is contended that approval by that Office of the Constitution and By-
Laws of the Club is necessary for its effectivity and validity and since it was never
submitted to that Office, the Club had no valid constitution and By-Laws and that
as a consequence, Resolution No. 2 which was passed based on the Constitution
and By-Laws- is without any force and effect and the treasurer, Violeta Delmo,
who extended loans to some officers and members of the Club pursuant thereto
are illegal (sic), hence, she and the other students involved are deemed guilty of
misappropriating the funds of the Club. On the other hand, Raclito Castaneda,
Nestor Golez and Violeta Delmo, President, Secretary and Treasurer of the Club,
 respectively, testified that the Club had adopted its Constitution and By-Laws in a
meeting held last October 3, 1965, and that pursuant to Article I of said
Constitution and By-Laws, the majority of the members of the Executive Board
passed Resolution No. 2, which resolution became the basis for the extension on
of loans to some officers and members of the Club, that the Club honestly
believed that its Constitution and By-Laws has been approved by the
superintendent because the adviser of the Club, Mr. Jesse Dagoon, assured the
President of the Club that he will cause the approval of the Constitution and By-
Laws by the Superintendent; the officers of the Club have been inducted to office
on October 9,1965 by the Superintendent and that the Club had been likewise
allowed to cosponsor the Education Week Celebration.

After a careful study of the records, this Office sustains the action taken by the
Superintendent in penalizing the adviser of the Club as well as the officers and
members thereof by dropping them from membership therein. However, this
Office is convinced that Violets M. Delmo had acted in good faith, in her capacity
as Club Treasurer, in extending loans to the officers and members of the Student
partnership Club. Resolution No. 2 authorizing the Club treasurer to discharge
finds to students in need of financial assistance and other humanitarian purposes
had been approved by the Club adviser, Mr. Jesse Dagoon, with the notation that
approval was given in his capacity as adviser of the Club and extension of the
Superintendent's personality. Aside from misleading the officers and members of
the Club, Mr. Dagoon, had unsatisfactorily explained why he failed to give the
Constitution and By-Laws of the Club to the Superintendent for approval despite
his assurance to the Club president that he would do so. With this finding of
negligence on the part of the Club adviser, not to mention laxity in the
performance of his duties as such, this Office considers as too severe and
unwarranted that portion of the questioned order stating that Violeta Delmo "shall
not be a candidate for any award or citation from this school or any organization
in this school." Violeta Delmo, it is noted, has been a consistent full scholar of the
school and she alone has maintained her scholarship. The decision in question
would, therefore, set at naught all her sacrifice and frustrate her dreams of
graduating with honors in this year's commencement exercises.

In view of all the foregoing, this Office believes and so holds and hereby directs
that appellant Violeta. M. Delmo, and for that matter all other Club members or
officers involved in this case, be not deprived of any award, citation or honor from
the school, if they are otherwise entitled thereto. (Rollo, pp. 28-30)

On April 27, 1966, the petitioner received by mail the decision of the Director and all the records
of the case. On the same day, petitioner received a telegram stating the following:

"AIRMAIL RECORDS DELMO CASE MISSENT THAT OFFICE"

The Director asked for the return only of the records but the petitioner allegedly mistook the
telegram as ordering him to also send the decision back. On the same day, he returned by mail
all the records plus the decision of the Director to the Bureau of Public Schools.

The next day, the petitioner received another telegram from the Director order him to furnish
Delmo with a copy of the decision. The petitioner, in turn, sent a night letter to the Director
informing the latter that he had sent the decision back and that he had not retained a copy
thereof..

On May 3, 1966, the day of the graduation, the petitioner received another telegram from the
Director ordering him not to deprive Delmo of any honors due her. As it was impossible by this
time to include Delmo's name in the program as one of the honor students, the petitioner let her
graduate as a plain student instead of being awarded the Latin honor of Magna Cum Laude.

To delay the matter further, the petitioner on May 5, 1966, wrote the Director for a
reconsideration of the latters" decision because he believed that Delmo should not be allowed to
graduate with honors. The Director denied the petitioner's request.

On July 12, 1966, the petitioner finally instructed the Registrar of the school to enter into the
scholastic records of Delmo the honor, "Magna Cum Laude."

On July 30, 1966, Delmo, then a minor, was joined by her parents in flag action for damages
against the petitioner. During the pendency of the action, however, Delmo passed away, and
thus, an Amended and Supplemental Complaint was filed by her parents as her sole and only
heirs.

The trial court after hearing rendered judgment against the petitioner and in favor of the spouses
Delmo. The court said:

Let us go to specific badges of the defendants (now petitioners) bad faith. Per
investigation of Violeta Delmo's appeal to Director Vitaliano Bernardino of the
Bureau of Public Schools (Exhibit L it was the defendant who inducted the
officers of the Student Leadership Club on October 9, 1965. In fact the Club was
allowed to cosponsor the Education Week Celebration. (Exh. "L"). If the
defendant he not approve of the constitution and by-laws of the Club, why did he
induct the officers into office and allow the Club to sponsor the Education Week
Celebration"? It was through his own act that the students were misled to do as
they did. Coupled with the defendants tacit recognition of the Club was the
assurance of Mr. Jemm Dagoon, Club Adviser, who made the students believe
that he was acting as an extension of Mr. Ledesma's personality. (Exhibit "L").

Another badge of the defendan'ts want of good faith is the fact that, although, he
kaew as early as April 27,1966 that per on of r Bernardino, Exhibit "L," he was
directed to give honors to Miss Delmo, he kept Id information to . He told the
Court that he knew that the letter of Director Bernardino directed him not to
deprive Miss Delmo the honors due her, but she (sic) says that he has not
finished reading the letter-decision, Exhibit "L," of Director Bernardino 0, him to
give honors to Miss Delmo. (Tsn, Feb. 5, 1974, testimony of Mr. Ledesma, pp. .
33-35). It could not be true that he has not finished reading the letter-decision,
Exh. "L," because said letter consisted of only three pages, and the portion which
directed that Miss Delmo "be not deprived of any award, citation or honor from
the school, if otherwise entitled thereto is found at the last paragraph of the same.
How did he know the last paragraph if he did not read the letter.

Defendants actuations regarding Miss Delmo's cam had been one of bias and
prejudice. When his action would favor him, he was deliberate and aspect to the
utter prejudice and detriment of Miss Delmo. Thus, although, as early as April 27,
1966, he knew of the exoneration of Miss Delino by Director Bernardino, he
withheld the information from Miss Delmo. This is eloquently dramatized by Exh.
"11" and Exh. "13" On April 29,1966, Director Bernardino cabled him to furnish
Violeta Delmo copy of the Decision, Exh. "L," but instead of informing Miss Delmo
about the decision, since he said he mailed back the decision on April 28,1966,
he sent a night letter on April 29,1966, to Director Bernardino, informing the latter
that he had returned the decision (Exh. "l3"), together with the record. Why a
night letter when the matter was of utmost urgency to the parties in the case,
because graduation day was only four days ahead? An examination of the
telegrams sent by the defendant shows that he had been sending ordinary
 telegram and not night letters. (Exh. "5", Exhibit "7"). At least, if the defendant
could not furnish a copy of the decision, (Exh. "L"), to Miss Delmo, he should
have told her about it or that Miss Delmo's honors and citation in the
commencement be announced or indicated. But Mr. Ledesma is one who cannot
admit a mistake. Very ungentlemanly this is home out by his own testimony
despite his knowledge that his decision to deprive Miss Delmo of honors due to
her was overturned by Director Bernardino, he on his wrong belief. To quote the
defendant,1 believed that she did not deserve those honors(Tsn Feb. 5, 1974, p.
43,Empasized supplied). Despite the telegram of Director Bernardino which the
defendant received hours before the commencement executory on May 3-
4,1966, he did not obey Director Bernardino because he said in his testimony that
he would be embarrassment . Tan Feb 5,1974, P. 46). Evidently, he knew only
his embarrassment and not that of r Bernardino whose order was being flagrantly
and wantonly disregarded by bim And certainly, not the least of Miss Delmo's
embarrassment. His acts speak eloquently of ho bad faith and unjust of
mindwarped by his delicate sensitivity for having been challenged by Miss Delmo,
a mere student.

xxx xxx xxx

Finally the defendant's behaviour relative to Miss s case smacks of contemptuous

arrogance, oppression and abuse of power. Come to think of it. He refused to
obey the directive of Be o and instead, chose to feign ignorance of it." (Reward
on Appeal, p. 72-76).

The trial court awarded P20,000.00 to the estate of Violeta Delmo and P10,000.00 to her parents
for moral damages; P5,000.00 for nominal damages to Violeta's estate; exemplary damages of
P10,000.00 and P2,000.00 attorney's fees.

On appeal, the Court of Appeals affirmed the decision. Hence, this petition.

The issues raised in this petition can be reduced to the sole question of whether or not the
respondent Court of Appeals erred in affirming the trial court's finding that petitioner is liable for
damages under Article 27 of the New Civil Code.

We find no reason why the findings of the trial and appellate courts should be reversed. It cannot
be disputed that Violeta Delmo went through a painful ordeal which was brought about by the
petitioner's neglect of duty and callousness. Thus, moral damages are but proper. As we have
affirmed in the case of (Prudenciado v. Alliance Transport System, Inc., 148 SCRA 440, 448):

There is no argument that moral damages include physical suffering, mental

anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral
shock, social humiliation, and similar injury. Though incapable of pecuniary
computation, moral damages may be recovered if they are the proximate result of
defendant's wrongly act or omission." (People v. Baylon, 129 SCRA 62 (1984).

The Solicitor-General tries to cover-up the petitioner's deliberate omission to inform Miss Delmo
by stating that it was not the duty of the petitioner to furnish her a copy of the Director's decision.
Granting this to be true, it was nevertheless the petitioner's duty to enforce the said decision. He
could have done so considering that he received the decision on April 27, 1966 and even though
he sent it back with the records of the case, he undoubtedly read the whole of it which consisted
of only three pages. Moreover, the petitioner should have had the decency to meet with Mr.
Delmo, the girl's father, and inform the latter, at the very least of the decision. This, the petitioner
likewise failed to do, and not without the attendant bad faith which the appellate court correctly
pointed out in its decision, to wit:
 Third, assuming that defendant could not furnish Miss Delmo of a copy of the
decision, he could have used his discretion and plain common sense by
informing her about it or he could have directed the inclusion of Miss Delmo's
honor in the printed commencement program or announced it during the
commencement exercises.

Fourth, defendant despite receipt of the telegram of Director Benardino hours

before the commencement exercises on May 3-4, 1966, disobeyed his superior
by refusing to give the honors due Miss Delmo with a lame excuse that he would
be embarrassed if he did so, to the prejudice of and in complete disregard of Miss
Delmo's rights.

Fifth, defendant did not even extend the courtesy of meeting Mr. Pacifico Delmo,
father of Miss Delmo, who tried several times to see defendant in his office thus
Mr. Delmo suffered extreme disappointment and humiliation.

xxx xxx xxx

Defendant, being a public officer should have acted with circumspection and due
regard to the rights of Miss Delmo. Inasmuch as he exceeded the scope of his
authority by defiantly disobeying the lawful directive of his superior, Director
Bernardino, defendant is liable for damages in his personal capacity. . . . (Rollo,
pp- 57-58)

Based on the undisputed facts, exemplary damages are also in order. In the same case
of Prudenciado v. Alliance Transport System, Inc., supra., at p. 450, we ruled:

The rationale behind exemplary or corrective damages is, as the name implies, to
provide an example or correction for the public good (Lopez, et al. v. Pan
American World Airways, 16 SCRA 431).

However, we do not deem it appropriate to award the spouses Delmo damages

in the amount of P10,000.00 in their individual capacity, separately from and in
addition to what they are already entitled to as sole heirs of the deceased Violeta
Delmo. Thus, the decision is modified insofar as moral damages are awarded to
the spouses in their own behalf.

WHEREFORE, the petition is DISMISSED for lack of merit. The decision of the Court of Appeals
is AFFIRMED with the slight modification as stated in the preceding paragraph. This decision is
immediately executory.

SO ORDERED.

G.R. No. L-46096 July 30, 1979

EUFEMIO T. CORREA, petitioner,
vs.
COURT OF FIRST INSTANCE OF BULACAN (BRANCH 11), CITY SHERIFF OF QUEZON
CITY, MUNICIPALITY OF NORZAGARAY, BULACAN, HON. ARMANDO ENRIQUEZ, as the
Incumbent Mayor of Norzagaray, Bulacan, CANDIDO P. CRUZ, ISABELO SAPLALA,
TOMAS PALAD, ANTONIO SILVERIO, MELANIO ESTEBAN, ELIGIO PUNZAL, CELEDONIO
PRINCIPE, ANTONIO ANCHETA, and JUANITO SARMIENTO, respondents.

Magtanggol C. Gunigundo for petitioner.

Ponciano G. Hernandez for private respondents.

ANTONIO, J.: 1äwphï1.ñët

Petition for certiorari, prohibition and declaratory relief assailing the Order dated April 22, 1977 of
respondent Court of First Instance of Bulacan, Branch II, denying petitioner's Motion to Quash
Writ of Execution issued in Civil Case No. 3621- M. The following are the relevant facts:

On December 13, 1968, respondent Court rendered judg- ment in Civil Case No. 3621-M in favor
of therein plaintiffs (private respondents herein) and adversely against therein defendants
Eufemio T. Correa (petitioner herein) and Virgilio Sarmiento. The pertinent portions of the
decision read as follows:  têñ.£îhqwâ£

This Court finds that defendants Eufemio T. Correa and Virgilio Sarmiento,
municipal mayor and municipal treasurer of Norzagaray, Bulacan respectively,
should be ordered personally to pay the salaries which the plaintiffs failed to
receive by reason of their illegal removal from office until they are actually
reinstated.

xxx xxx xxx

WHEREFORE, judgment is hereby rendered:

1. Permanently enjoining the defendants from enforcing and/or implementing the

Administrative Order No. 1, Series of 1968;

2. Declaring the termination of the services of the plaintiffs illegal and of no legal
effect;

3. Ordering the defendant Eufemio T. Correa to reinstate the plaintiffs to their

former position as policemen in the Police Force of Norzagaray, Bulacan;

4. Ordering the defendants Eufemio T. Correa and Virgilio Sarmiento to pay,

jointly and severally to the plaintiff Juanito Sarmiento his salary for the period
beginning January 15, 1968, plaintiff Melanio Esteban his said for the period
beginning February 1, 1968; and plaintiffs Candido Cruz, Isabelo Saplala, Tomas
Palad; Antonio Ancheta, Antonio Silverio, Eligio Punzal and Celedonio Principe
their salaries for the period beginning January 23, 1968, until they are actually
reinstated to their former positions;

5. Ordering defendant Eufemio T. Correa and Virgilio Sarmiento to pay, jointly

and severally, the costs of this suit.

SO ORDERED.

The aforesaid decision was affirmed by the Court of Appeals on March 22, 1976, and the motion
for reconsideration of the Appellate Court's decision was denied on May 11, 1976. On August 24,
1976, the decision of the Court of Appeals became final and executory.  1

It is in connection with the efforts of the petitioner to quash the writ of execution issued to enforce
the aforestated final judgment that the present proceedings arose. Thus, on March 8, 1977,
petitioner filed a Motion to Quash the Writ of Execution and to Direct Execution to the
Municipality of Norzagaray, Bulacan, alleging that at the time the writ was served on him, he was
no longer mayor of Norzagaray, Bulacan. Petitioner invoked the principle that when judgment is
rendered against an officer of the municipal corporation who is sued in his official capacity for the
payment of back salaries of officers illegally removed, the judgment is binding upon the
corporation, whether or not the same is included as party to the action.  2

On April 22, 1977, respondent Court issued the Order denying the Motion to Quash Writ of
Execution. Petitioner thus came to this Court, maintaining that he could no longer be required to
pay the back salaries of the private respondents because payment on his part presupposes his
continuance in office, which is not the case. He contends that it is the Municipality of Norzagaray
that is liable for said payment, invoking Aguador v. Enerio.   and Sison v. Pajo   Further, petitioner
3 4

alleges that the fact that he is no longer municipal mayor of Norzagaray, constitutes a substantial
change in the situation of the parties which makes the issuance of the writ of execution
inequitable.

Petitioner prays, among others, that judgment be rendered declaring that the payment of back
salaries of private respondents should be made by the incumbent mayor and by the municipality
of Norzagaray, Bulacan, and that petitioner is no longer liable for the payment thereof; and
annulling the Order dated April 22, 1977 of respondent court denying the motion to quash the
writ of execution.

On May 24, 1977, this Court required petitioner to implead the Municipality of Norzagaray,
Bulacan as party respondent and on June 25, 1977, petitioner filed an amended petition
impleading the Municipality of Norzagaray and Amando Enriquez, the incumbent municipal
mayor.

In his amended petition, petitioner alleges that the writ of execution is already being enforced
against the personal properties of petitioner; that such enforcement during the pendency of the
instant petition would probably work injustice to petitioner; and that petitioner stands to suffer
great and irreparable injury if enforcement of the writ is not temporarily restrained. Petitioner,
therefore, prays that the execution be stayed or a temporary restraining order be issued pending
resolution of the instant proceedings.

On August 1, 1977, private respondents filed their Comment maintaining that respondent court
acted correctly and committed no abuse of discretion when it denied petitioner's motion to quash
the writ of execution, (1) it being the ministerial duty of the trial court to issue a writ for the
enforcement of a final and executory judgment; and (2) since the personal liability of the
petitioner and his co-defendant to pay the back salaries of the private respondents as mandated
in the decision sought to be executed cannot be shifted or transferred to the municipality of
Norzagaray, Bulacan, for to do so would be to vary the terms of a final judgment. On August 12,
1977, this Court resolved to consider the Comment of respondents as answer to the petition and
required the parties to file their respective memoranda, and thereafter the case was submitted for
decision.

The issue is whether or not respondent Court in denying the Motion to Quash the Writ of
Execution acted with grave abuse of discretion or with lack or excess of jurisdiction.

It cannot be denied that both the judgments of the Court of First Instance of Bulacan and of the
Court of Appeals categorically state that the liability of herein petitioner is personal. Thus,
according to the trial court, "Eufemio T. Correa and Virgilio Sarmiento, municipal mayor and
municipal treasurer of Norzagaray, Bulacan, respectively, should be ordered personally to pay
the salaries which the plaintiffs failed to receive by reason of their illegal removal from office until
they are actually reinstated." (Emphasis supplied).

In affirming the decision of the trial court, the Court of Appeals   ruled that "The defendants
5

are personally liable jointly and severally because they acted without justifiable cause (Nemenzo
vs. Sabillano, Sept. 7, 1968, 25 SCRA 1)."  6
The jurisprudence relied upon by the petitioner in his effort to shift the responsibility to the
Municipality of Norzagaray appears inapplicable. In Aguador v. Enerio, supra, cited by petitioner,
the municipal mayor and the members of the Municipal Council of Oroquieta were specifically
ordered "to appropriate necessary amounts to pay the salary differentials for the petitioners and
also for the payment of their entire salaries from month to month, subject naturally to the
availability of funds after all statutory and subsisting contractual obligations shall have been
properly covered by adequate appropriations. " The issue raised was whether or not, after the
municipal mayor, members of the municipal council and the municipal treasurer were expressly
made parties in the mandamus case and in the contempt proceedings, it was necessary to
include the municipality as a party, to make the latter liable. This issue was resolved in the
negative by this Court. In the case of Sison v. Pajo, supra, the trial court directed the Acting
Municipal Mayor and Acting Chief of Police of Bamban, Tarlac to reinstate Bonifacio Lacanlale as
Acting Chief of Police, effective June 30, 1957 "with the incident of payment of back salaries by
the Municipality of Bamban." The issue was whether or not the municipality of Bamban could be
ordered to pay the back salaries of the Chief of Police, it appearing that said municipality was not
impleaded in the case. This Court ruled that the fact that the Municipality of Bamban, Tarlac was
not by name impleaded in the case of reinstatement and back salaries does not affect the
employee's right to the payment of back salaries, considering that the officers required by law to
represent the municipality in an suits were made parties in their official capacity, hence the case
was heard and decided as if the municipality had been made a party. In both eases the judgment
of the Court specifically directed the municipality to pay the back salaries.

Here, the judgment of the trial court, which was affirmed by the Court of Appeals, found
petitioners Eufemio T. Correa and Virgilio Sarmiento personally liable for the payment of the
salaries which the dismissed policemen failed to receive because of their illegal removal from
office, and ordered them "to pay jointly and severally to the plaintiff Juanito Sarmiento his salary
for the period beginning January 15, 1968; plaintiff Melanio Esteban his salary for the period
beginning February 1, 1968; and plaintiffs Candido Cruz, Isabelo Saplala, Tomas Palad, Antonio
Ancheta, Antonio Silverio, Eligio Punzal and Celedonio Principe their salaries for the period
beginning January 23, 1968, until they are actually reinstated to their former positions."

In Nemenzo vs. Sabillano,   the Court ruled that appellant Municipal Mayor Bernabe Sabillano
7

was "correctly adjudged liable" for the payment of the back salaries of appellee Police Corporal
Joaquin P. Nemenzo because his act of dismissing appellee "without previous administrative
investigation and without justifiable cause ... is clearly an injury to appellee's rights. Appellant
cannot hide under the mantle of his official capacity and pass the liability to the municipality of
which he was mayor. There are altogether too many cases of this nature, wherein local elective
officials, upon assumption of office, wield their new-found power indiscriminately by replacing
employees with their own proteges, regardless of the laws and regulations governing the civil
service. Victory at the polls should not be taken as authority for the commission of such illegal
acts."

In the discharge of govermental functions, "municipal corporations are responsible for the acts of
its officers, except if and when and only to the extent that , they have acted by authority of the
law, and in comformity with the requirements thereof."  8

A Public officer who commits a tort or other wrongful act, done in excess or beyond the scope of
his duty, is not protected by his office and is personally liable therefor lie any private
individual.   This principle of personal liability has been applied to cases where a public officer
9

removes another officer or discharges an employee wrongfully, the reported cases saying that by
reason of non-compliance with the requirements of law in respect to removal from office, the
officials were acting outside their official authority." 
10

Respondent Court, therefore, did not commit grave abuse of discretion in denying petitioner's
motion to quash writ of execution. The writ was strictly in accordance with the terms of the
judgment.
WHEREFORE, the instant petition is hereby DISMISSED. Costs against petitioner.

Barredo, (Chairman), Aquino, Concepcion, Jr., and De Castro, JJ., concur. 1äwphï1.ñët

Santos and Abad Santos, JJ., are on leave.

G.R. No. 96740 March 25, 1999

VIRGINIA P. SARMIENTO and APOLONIA P. CATIBAYAN, petitioners,

vs.
COURT OF APPEALS and SIMON ARGUELLES, respondents.

PURISIMA, J.:

At bar is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court, seeking
to set aside the Decision,   dated October 26, 1989 and the Resolution,   dated January 4, 1991,
1 2

of the Court of Appeals   in CA — G.R. CV No. 11750, reversing the Decision   , dated May 30,
3 4

1986, of Branch XV, Regional Trial Court, in Trece Martires City   in Civil Case No. NC-75.
5

The antecedent facts that matter are as follows:

Virginia P. Sarmiento and Apolonia P. Catibayan, the petitioners herein, filed a complain for
partition of a piece of land, more particularly described as Lot No. 926 of the Naic Estate,
G.L.R.O., Record No. 8340, in Naic, Cavite, with an area of 1,779 square meters, covered by
TCT No. 21877 issued on September 1, 1941 to co-owners, Francisco Arguelles and Petrona
Reyes.

Petitioners are sisters, their parents being Tiburcio Pangilinan and Leogarda Arguelles, who died
in 1946. Leogarda was the daughter of Francisco Arguelles who died on February 18, 1949 and
Emilia Pineli, who died on May 2, 1950. Private respondent Simon Arguelles is a half brother of
Leogarda, with Francisco Arguelles as their common father.

Petitioners claim that as granddaughters of Francisco Arguelles, they and private respondent
Simon Arguelles are co-owners of the 1/2 portion of Lot No. 926, as the only heirs of the late
Francisco Arguelles. But according to private respondent, petitioners are not the legal heirs of
Francisco Arguelles because their (petitioners') mother, Leogarda Arguelles, was allegedly an
illegitimate child of his father, Francisco Arguelles, and Emilia Pineli who were not married.
Under the old Civil Code, which should be applied since Francisco Arguelles died in 1949, before
the effectivity of the New Civil Code, an illegitimate child did not have successional rights.

After trial, the lower court came out with a decision ordering the parties herein to partition among
themselves subject 1/2 portion of Lot No. 926; and disposing thus:

In view of all the foregoing, plaintiffs Virginia P. Sarmiento and Apolonia P.

Catibayan and defendant Simon Arguelles are hereby ordered to partition among
themselves the one-half portion of Lot No. 926 of the Naic Estate, located in Naic,
Cavite, covered by Transfer Certificate of title No. 21877, pertaining to the
deceased Francisco Arguelles.

The counterclaim, for lack of merit, is hereby dismissed.

No pronouncement is made as to cost.

 SO ORDERED. 6

Dissatisfied therewith, the private respondent went to the Court of Appeals on a Petition for
Review; theorizing that:

I. The Lower Court erred in holding that Francisco Arguelles and Emilia Pineli
were legally married and that Leogardo (sic) Arguelles was their legitimate
daughter.

II. The Lower Court erred in not holding that the cause of action of the plaintiffs-
appellees if any, had already prescribed.

III. The Lower Court erred in ordering the partition of the property involved in this
case among the plaintiffs-appellees and the defendant-appellant.  7

On October 26, 1989, the Court of Appeals handed down its judgment, reversing the decision of
the Regional Trial Court of origin and disposing as follows:

WHEREFORE, judgment is hereby entered REVERSING the decision appealed

from and DISMISSING the complaint for judicial partition. Without
pronouncement as to costs.

SO ORDERED. 8

With the denial with their Motion For Reconsideration on January 4, 1991, petitioners found their
way to this court via the present Petition; posing as issues:

I. WHETHER OR NOT A MAN AND A WOMAN WHO LIVED TOGETHER AS

HUSBAND AND WIFE ARE PRESUMED MARRIED; and.

II. WHETHER THE BORN OUT OF SUCH MARRIAGE IS LEGITIMATE OR

NOT. 9

The pivotal issue for determination is: whether or not the petitioners offered sufficient evidence to
substantiate their submission that Francisco Arguelles and Emilia Pineli were legally married.

Sec. 3 (aa) of Rule 131 of the Revised Rules of Court provides:

Sec. 3. Disputable presumptions, —The following presumptions are satisfactory if

uncontradicted, but maybe contradicted or overcome by other evidence

xxx xxx xxx

(aa) That a man and a woman deporting themselves as husband and wife have
entered into a lawful contract of marriage;

x x x           x x x          x x x

Guided by the aforecited provision of law, the trial court ratiocinated:

The fact that no marriage certificate of Francisco Arguelles and Emilia Pineli was
submitted in evidence does not lead to the conclusion that the said parties were
not legally married and that Leogarda was their illegitimate child. The defendant
admitted that his father and Emilia Pineli lived and cohabited together as
 husband and wife, even staying in the same house were he was also residing.
The presumption is that 'A man and woman deporting themselves as husband
and wife have entered into a lawful contract of marriage (sic) (Sec. 5(bb), Rule
131, Rules of Court).   Every intendment of law or facts leans toward the validity
10

of marriage and the legitimacy of children (Art. 220, Civil Code). In this case, no
evidence was adduced by defendant Arguelles to rebut this presumption. Neither
did he attempt to show that Francisco and Emilia could not validity marry each
other because of some legal impediments to their marriage. 11

While it is true that Francisco Arguelles and Emilia Pineli cohabited as husband and wife, private
respondent Simon Arguelles testified that the said cohabitation was without the benefit of
marriage. In People vs. Borromeo  , this Court held that persons living together in apparent
12

matrimony are presumed, absent any counter presumption or evidence special to the case, to be
in fact married. 
13

In the case under consideration, the presumption of marriage, on which the trial court premised
its decision, has been sufficiently offset.   Records reveal that petitioners tried to justify the non-
14

presentation of the marriage certificate of Francisco and Emilia by submitting a certification

issued by Assistant Treasurer Lucila Lucero of Naic, Cavite, to the effect that:

the Marriage Certificate of Francisco Arguelles married to Emilia Pineli on the

18th day of August, 1918 at Naic, Cavite, is no longer available due to destruction
of the records during the Japanese occupation, and as such no certified copy of
Marriage could be issued to the parties concerned. 15

However, Assistant Treasurer Lucila Lucero admitted later   on the witness stand that she signed
16

the said certificate prepared by a certain Consuelo Pangilinan, without verifying its correctness.
In reality, the records of marriages of Naic are intact. The said records were brought and
examined before the trial court, and its pages 20 to 22 containing entries from July 3, 1917 to
May 30, 1918 do not reflect the names of Francisco Arguelles and Emilia Pineli.

So also, the death certificate of Francisco Arguelles contained the word "none" opposite the
phrase "surviving spouse", indicating that he died a widower on February 18, 1949. His
deceased wife was Petrona Reyes, the mother of private respondent.  17

Then too, TCT No. 21877 covering Lot 926 as well as the reconstituted TCT No. 21877, RT-
19055, show the status of Francisco Arguelles as "widower".   On this point, the respondent
18

court said:

. . . Emilia would not have allowed Francisco Arguelles to place the property in
his name alone as widower if in fact they were legally married to each other. If
there was a mistake in indicating in the title Francisco's status as a widower, the
same could have been easily cured by presenting a petition for correction in the
proper court. If it is true, as Tiburcio Pangilinan testified, that the certificate of title
was the possession of Emilia Pineli and was given to him (Tiburcio) before her
death, there is no conceivable reason why Emilia never exerted any effort to
correct the mistake in the description of Francisco's status in the certificate of title
as 'widower' knowing that she would not be able to transmit any part of the
property to her heirs upon her death if the error was not corrected. Her omission
only serves to bolster the proposition that she had no right to protect, in the first
place, because she was not legally married to
Francisco. 19

Consequently, with the presumption of marriage sufficiently overcome, the onus probandi of the
private respondent shifted to the petitioners. It then became the burden of the petitioners, Virginia
P. Sarmiento and Apolonia P. Catibayan, to prove that their deceased grandparents, Francisco
Arguelles and Emilia Pineli, were legally married.

In Trinidad vs. Court of Appeals, et a1.  , this Court ruled that as proof of marriage may be
20

presented: a) testimony of a witness to the matrimony; b) the couple's public and open
cohabitation as husband and wife after the alleged wedlock; c) the birth and baptismal certificate
of children born during such union; and d) the mention of such nuptial in subsequent documents.

Pertinent records show that the petitioners failed to substantiate their theory that Francisco
Arguelles and Emilia Pineli were married. What is more, the available records of marriage
contradict the allegation that Francisco Arguelles and Emilia Pineli were legally married. But
petitioners, to whom the burden of proving the fact of marriage shifted, did not present anybody
who witnessed the marriage ceremony of Francisco Arguelles and Emilia Pineli. As aptly
reasoned out by the respondent court:

. . . Not one of the three witnesses for plaintiffs ever declared having observed
that Francisco and Emilia acted as husband and wife. Tiburcio Pangilinan
testified mainly on the fact that he is the father of the plaintiffs and husband of the
late Leogarda Arguelles who was the daughter of Francisco Arguelles and Emilia
Pineli. The rest of his testimony touched on the certificate of tittle covering Lot
926 which Emilia allegedly delivered two weeks before she died but was later on
taken from him by defendant. Plaintiffs on their part did not testify that Francisco
Arguelles and Emilia Pineli lived together as husband and wife, which may be
explained by the fact that Virginia Sarmiento and Apolonia Catibayan where only
6 and 5 years old, respectively, when Emilia Pineli died and were then too young
to perceive the nature of whatever the relationship existed Francisco and Emilia. 21

Evidently, petitioners relied mainly on the legal presumption that Francisco Arguelles and Emilia
Pineli were married, without introducing any evidence to prove the marriage theorized upon.

In a belated attempt to establish the legitimacy of Leogarda Arguelles, petitioners have theorized
for the first time, in the present Petition, that the birth certificate   of Leogarda Arguelles which
22

they allegedly presented during the trial below, shows the legitimate status of Leogarda
Arguelles.   Concededly, such birth certificate may be used to show the alleged marriage. But be
23

that as it may, the totality of evidence for the private respondent preponderates over petitioners'.
Preponderant evidence means that, as a whole, the evidence adduced by one side outweighs
that of the adverse party.   Compared with the evidence introduced by the private respondent,
24

petitioners rely heavily on the legal presumption of marriage which, as earlier pointed out, has
been effectively rebutted. We are concluded by the factual findings of the Court of Appeals.

Premises studiedly considered, we are of the ineluctable conclusion, and so hold, that the Court
of Appeals erred not in reversing the decision of the Regional Trial Court a quo.

WHEREFORE, the Petition is DENIED and the assailed Decision, dated October 26, 1989, and
Resolution, dated January 4, 1991, of the Court of Appeals AFFIRMED. No pronouncement as to
costs.

SO ORDERED.

PHILIPPINE NATIONAL BANK, Plaintiff-Appellee, vs. DALMACIO CATIPON, Defendant-Appellant.

 
DECISION
REYES, J. B. L., J.:
This appeal is taken from the decision of the Court of First Instance of Manila in its Civil Case No.
15711 sentencing Dalmacio Catipon to pay the Philippine National Bank the principal sum of
P3,050.83 with interest thereon from September 1, 1951 until full payment plus costs.
The facts are set forth in the judgment appealed from to be as follows: chanroblesvirtuallawlibrary

“The parties stipulate, among other things, that Defendant affixed his signature on the Trust Receipt,
Exhibit “A” because of his strong desire to get the onions purchased by him from J. V. Ramirez & Co.,
Inc., and which were duly paid for to said J. V. Ramirez & Co., Inc., and not to Plaintiff Bank, as
evidenced by receipts marked Exhibits 1, 2 and 3;  that his signature was affixed at the Divisoria chan roblesvirtualawlibrary

Market when a son of J. V. Ramirez came to him and explained that the only way to get onions which
he bought was to sign the said Trust Receipt Exhibit “A”;  that the signature of Dalmacio Catipon chan roblesvirtualawlibrary

(Defendant) was affixed long after the trust receipt Exhibit A was signed by J. V. Ramirez;  that J. V. chan roblesvirtualawlibrary

Ramirez, who is the President and General Manager of J. V. Ramirez & Co., Inc., is the indentor and
importer and that Dalmacio Catipon is only a customer of J. V. Ramirez & Co., Inc.;  that chan roblesvirtua lawlibrary

“Plaintiff filed a claim against J. V. Ramirez in the Insolvency Proceedings of J. V. Ramirez & Co., Inc.
(Civil Case No. 3191 of the Court of First Instance of Manila) long before the present complaint was
filed”;  and that “Plaintiff did not realize any cent out of its claim filed in the insolvency
chan roblesvirtualawlibrary

proceedings as J. V. Ramirez & Co. has no sufficient assets to meet all claims of the creditors
including that of the Plaintiff.” (Rec. App. pp. 92-93.)
It is also of record that at the instance of the bank, Catipon was charged with estafa (Criminal Case
No. 8190) for having misappropriated, misapplied and converted the merchandise covered by the
trust receipt;  but after due trial was acquitted from the charge. Shortly thereafter, the bank
chan roblesvirtualawlibrary

commenced the present action to recover the value of the goods.

Dalmacio Catipon rests his present appeal on three points, the same ones invoked by him in the
court below. They are:  (1) That his acquittal in the estafa case is a bar to the Bank’s instituting the
chanroblesvirtua llawlibrary

present civil action, because the Bank did not reserve in the criminal case its right to separately
enforce the civil liability of the Appellant;  (2) That under the facts stipulated, the Defendant was chan roblesvirtualawlibrary

not liable under the trust receipt;  and (3) That if at all, he should be held liable only for one-half of
chan roblesvirtualawlibrary

the value of the goods under trust, there being no stipulation that he would be solidarily liable with
his co-signer.
We agree with the trial court that the Appellant’s case has no merit. The decision
acquitting Appellant Catipon of the charge of estafa does not preclude or bar the filing of this action
to enforce his liability as one of the signers of the trust receipt Exhibit “A”, for several reasons: chanroblesvirtuallawlibrary

(a)  Because the acquittal was predicated on the conclusion “that the guilt of the Defendant,
Dalmacio Catipon has not been satisfactorily established”, as expressly recited by the decision of
acquittal of Judge Alejandro Panlilio Exhibit 4-b, p. 4) and this acquittal being equivalent to one on
reasonable doubt, does not preclude a suit to enforce the civil liability for the same act or omission,
under Article 29 of the new Civil Code;  it does not finally determine nor expressly declare that the chan roblesvirtualawlibrary

fact from which the civil action might arise did not exist (Rule 107, section 1 [d]);
(b)  Because the declaration in the decision of acquittal to the effect that “if any responsibility was
incurred by the accused — that is civil in nature and not criminal” amounts to a reservation of the
civil action in favor of the offended party, for the court in its decision had no reason to dwell on a
civil liability that it intended to extinguish by the same decision;  and chan roblesvirtualawlibrary

(c)  Because if the Appellant executed the trust receipt (that the present action seeks to enforce), he
is liable ex contractu for its breach, whether he did or he did not “misappropriate, misapply or
convert the said merchandise” as charged in the information filed in the criminal case.
The second issue raised by Appellant is likewise unmeritorious. Whether or not Catipon appended
his signature to the trust receipts at the request of the son of his cosigner J. V. Ramirez, and
regardless of the arrangements between them, the fact remains that by signing the trust receipt
the Appellant caused the Bank to believe he assumed the obligations thereunder together with his
co-signer;  and the Bank having acted on that assumption, induced by the Appellant, Catipon, the
chan roblesvirtualawlibrary

latter cannot, in equity, be heard now to deny his liability, under the well known principle of
estoppel. There is no finding that the Bank was not warned or had reason to believe that
the Appellant, in signing the trust receipt, nevertheless did not intend to be bound by its terms, or
that there were special arrangements between Ramirez and the Appellant.
As to the third defense, it appearing from the stipulation that the merchandise (onions) covered by
the trust receipt were delivered by Ramirez to the Appellant herein, who disposed thereof, it is but
right that he should be the one to answer for their value. Appellant’s payments to Ramirez cannot
diminish the rights of the Bank, since the trust receipt expressly obligated herein Appellant to pay
the Bank and not to his co-signer.
The decision appealed from is affirmed, without prejudice to the Appellant’s rights against his co-
signer J. V. Ramirez & Co., Inc. Costs against Appellant. SO ORDERED.

NICASIO BERNALDES, SR., PERPETUA BESAS DE

BERNALDES and JOVITO BERNALDES, aided by NICASIO
BERNALDES, SR., as Guardian-ad-litem, Plaintiffs-Appellants,
vs. BOHOL LAND TRANSPORTATION, INC., Defendant-
Appellee.

Lilio L. Amora and Peter L. Amora for plaintiffs-appellants.

Filemon B. Barria for defendant-appellee.

DIZON, J.: chanrobles virtual law library

In a complaint for damages filed in the Court of First Instance of

Bohol by appellants, the spouses Nicasio Bernaldes, Sr. and
Perpetua Besas and their minor son, Jovito, against appellee, the
Bohol Land Transportation Co., a domestic corporation engaged
in business as a common carrier in said province, they alleged, in
substance, that, in the afternoon of November 27, 1958, Jovito
Bernaldes and his brother, Nicasio, boarded one of appellee's
passenger trucks (B.L.T. Co. No. 322 with plate No. 1470) in the
town of Guindulman, Bohol, bound for Tagbilaran of the same
province; that on the way the bus fell off a deep precipice in
barrio Balitbiton, municipality of Garcia-Hernandez, of the said
province, resulting in the death of Nicasio and in serious physical
injuries to Jovito. chanroblesvirtualawlibrary chanrobles virtual law library

Defendant moved for the dismissal of the complaint on two

grounds, namely, that the cause of action alleged therein was
barred by a prior judgment, and that it did not state a cause of
action.chanroblesvirtualawlibrary chanrobles virtual law library

At the hearing on the motion to dismiss, it was established that in

Criminal Case No. 2775 of the same court, Leonardo Balabag,
driver of the bus involved in the accident, was charged with
double homicide thru reckless imprudence but was acquitted on
the ground that his guilt had not been established beyond
reasonable doubt, and that appellees, through Attys. Amora and
Tirol, intervened in the prosecution of said case and did not
reserve the right to file a separate action for damages. chanroblesvirtualawlibrary chanrobles virtual law library

Relying on the case of Maria C. Roa vs. Segunda de la Cruz, et

al., G.R. No. L-13134, promulgated February 13, 1960, the lower
court sustained the motion on the ground of bar by prior
judgment, and dismissed the case. Hence, this appeal. chanroblesvirtualawlibrary chanrobles virtual law library

The issues in this appeal are first, whether a civil action for
damages against the owner of a public vehicle, based on breach
of contract of carriage, may be filed after the criminal action
instituted against the driver has been disposed of, if the
aggrieved party did not reserve his right to enforce civil liability in
a separate action, and second, whether the intervention of the
aggrieved party, through private prosecutors, in the prosecution
of the criminal case against the driver - who was acquitted on the
ground of insufficiency of evidence - will bar him from suing the
latter's employer for damages for breach of contract, in an
independent and separate action. chanroblesvirtualawlibrary chanrobles virtual law library

Article 31 of the New Civil Code expressly provides that when the
civil action is based upon an obligation not arising from the act or
omission complained of as a felony, such civil action may proceed
independently of the criminal proceedings and regardless of the
result of the latter. This provision evidently refers to a civil action
based, not on the act or omission charged as a felony in a
criminal case, but to one based on an obligation arising from
other sources, such as law or contract. Upon the other hand it is
clear that a civil action based on contractual liability of a common
carrier is distinct from the criminal action instituted against the
carrier or its employee based on the latter's criminal negligence.
The first is governed by the provisions of the Civil Code, and not
by those of the Revised Penal Code, and it being entirely separate
and distinct from the criminal action, the same may be instituted
and prosecuted independently of, and regardless of the result of
the latter. (Visayan Land Transportation Co. vs. Mejia, et al., G.R.
Nos. L-8830, L-8837-39. 52 O.G. p. 4241).. chanroblesvirtualawlibrary chanrobles virtual law library

The civil action instituted against appellee in this case is based on

alleged culpa contractual incurred by it due to its failure to carry
safely the late Nicasio Bernaldes and his brother Jovito to their
place of destination, whereas the criminal action instituted
against appellee's driver involved exclusively the criminal and civil
liability of the latter arising from his criminal negligence. In other
words, appellant's action concerned the civil liability of appellee
as a common carrier, regardless of the liabilities of its driver who
was charged in the criminal case. Therefore, as held in Parker, et
al. vs. Panlilio, et al., (G.R. No. L-4961, March 5, 1952), the
failure, on the part of the appellants, to reserve their right to
recover civil indemnity against the carrier can not in any way be
deemed as a waiver, on their part, to institute a separate action
against the latter based on its contractual liability, or on culpa
aquiliana, under Articles 1902-1910 of the Civil Code. As a matter
of fact, such reservation is already implied in the law which
declares such action to be independent and separate from the
criminal action. Moreover, it has been held that the duty of the
offended party to make such reservation applies only to
defendant in the criminal action, not to persons secondarily liable
(Chaves, et al. vs. Manila Electric, 31 Phil. 47). chanroblesvirtualawlibrary chanrobles virtual law library

True, appellants, through private prosecutors, were allowed to

intervene - whether properly or improperly we do not here decide
- in the criminal action against appellee's driver, but if that
amounted inferentially to submitting in said case their claim for
civil indemnity, the claim could have been only against the driver
but not against appellee who was not a party therein. As a matter
of fact, however, inspite of appellee's statements to the contrary
in its brief, there is no showing in the record before Us that
appellants made of record their claim for damages against the
driver or his employer; much less does it appear that they had
attempted to prove such damages. The failure of the court to
make any pronouncement in its decision concerning the civil
liability of the driver and/or of his employer must therefore be
due to the fact that the criminal action did not involve at all any
claim for civil indemnity.
Wherefore, the parties respectfully pray that the foregoing
stipulation of facts be admitted and approved by this Honorable
Court, without prejudice to the parties adducing other evidence to
prove their case not covered by this stipulation of facts. chanroblesvirtualawlibrary chanrobles virtual law library

Lastly, as appellee's driver was acquitted only on reasonable

doubt, a civil action for damages against him may be instituted
for the same act or omission (Rule 107, par. [d]; Art. 29, New
Civil Code). If such is the rule as against him, a fortiori, it must in
the case of his employer. chanroblesvirtualawlibrary chanrobles virtual law library

IN VIEW OF ALL THE FOREGOING, we find the appeal interposed

by appellants to be meritorious. As a result, the order of dismissal
appealed from is hereby set aside and the case is remanded to
the lower court for further proceedings.
G.R. No. 141309             June 19, 2007

LIWAYWAY VINZONS-CHATO, petitioner,
vs.
FORTUNE TOBACCO CORPORATION, respondent.

DECISION

YNARES-SANTIAGO, J.:

Petitioner assails the May 7, 1999 Decision1 of the Court of Appeals in CA-G.R. SP No. 47167,
which affirmed the September 29, 1997 Order2 of the Regional Trial Court (RTC) of Marikina,
Branch 272, in Civil Case No. 97-341-MK, denying petitioner’s motion to dismiss. The complaint
filed by respondent sought to recover damages for the alleged violation of its constitutional rights
arising from petitioner’s issuance of Revenue Memorandum Circular No. 37-93 (RMC 37-93),
which the Court declared invalid in Commissioner of Internal Revenue v. Court of Appeals.3

Petitioner Liwayway Vinzons-Chato was then the Commissioner of Internal Revenue while
respondent Fortune Tobacco Corporation is an entity engaged in the manufacture of different
brands of cigarettes, among which are "Champion," "Hope," and "More" cigarettes.

On June 10, 1993, the legislature enacted Republic Act No. 7654 (RA 7654), which took effect
on July 3, 1993. Prior to its effectivity, cigarette brands ‘Champion," "Hope," and "More" were
considered local brands subjected to an ad valorem tax at the rate of 20-45%. However, on July
1, 1993, or two days before RA 7654 took effect, petitioner issued RMC 37-93 reclassifying
"Champion," "Hope," and "More" as locally manufactured cigarettes bearing a foreign
brand subject to the 55% ad valorem tax.4 RMC 37-93 in effect subjected "Hope," "More,"
and "Champion" cigarettes to the provisions of RA 7654, specifically, to Sec. 142, 5 (c)(1) on
locally manufactured cigarettes which are currently classified and taxed at 55%, and which
imposes an ad valorem tax of "55% provided that the minimum tax shall not be less than Five
Pesos (P5.00) per pack."6

On July 2, 1993, at about 5:50 p.m., BIR Deputy Commissioner Victor A. Deoferio, Jr.
sent via telefax a copy of RMC 37-93 to Fortune Tobacco but it was addressed to no one in
particular. On July 15, 1993, Fortune Tobacco received, by ordinary mail, a certified xerox copy
of RMC 37-93. On July 20, 1993, respondent filed a motion for reconsideration requesting the
recall of RMC 37-93, but was denied in a letter dated July 30, 1993. 7 The same letter assessed
respondent for ad valorem tax deficiency amounting to P9,598,334.00 (computed on the basis of
RMC 37-93) and demanded payment within 10 days from receipt thereof. 8 On August 3, 1993,
respondent filed a petition for review with the Court of Tax Appeals (CTA), which on September
30, 1993, issued an injunction enjoining the implementation of RMC 37-93. 9 In its decision dated
August 10, 1994, the CTA ruled that RMC 37-93 is defective, invalid, and unenforceable and
further enjoined petitioner from collecting the deficiency tax assessment issued pursuant to RMC
No. 37-93. This ruling was affirmed by the Court of Appeals, and finally by this Court
in Commissioner of Internal Revenue v. Court of Appeals.10 It was held, among others, that RMC
37-93, has fallen short of the requirements for a valid administrative issuance.

On April 10, 1997, respondent filed before the RTC a complaint 11 for damages against petitioner
in her private capacity. Respondent contended that the latter should be held liable for damages
under Article 32 of the Civil Code considering that the issuance of RMC 37-93 violated its
constitutional right against deprivation of property without due process of law and the right to
equal protection of the laws.

Petitioner filed a motion to dismiss12 contending that: (1) respondent has no cause of action
against her because she issued RMC 37-93 in the performance of her official function and within
the scope of her authority. She claimed that she acted merely as an agent of the Republic and
therefore the latter is the one responsible for her acts; (2) the complaint states no cause of action
for lack of allegation of malice or bad faith; and (3) the certification against forum shopping was
signed by respondent’s counsel in violation of the rule that it is the plaintiff or the principal party
who should sign the same.

On September 29, 1997, the RTC denied petitioner’s motion to dismiss holding that to rule on the
allegations of petitioner would be to prematurely decide the merits of the case without allowing
the parties to present evidence. It further held that the defect in the certification against forum
shopping was cured by respondent’s submission of the corporate secretary’s certificate
authorizing its counsel to execute the certification against forum shopping. The dispositive
portion thereof, states:

WHEREFORE, foregoing premises considered, the motion to dismiss filed by the

defendant Liwayway Vinzons-Chato and the motion to strike out and expunge from the
record the said motion to dismiss filed by plaintiff Fortune Tobacco Corporation are both
denied on the grounds aforecited. The defendant is ordered to file her answer to the
complaint within ten (10) days from receipt of this Order.

SO ORDERED.13

The case was elevated to the Court of Appeals via a petition for certiorari under Rule 65.
However, same was dismissed on the ground that under Article 32 of the Civil Code, liability may
arise even if the defendant did not act with malice or bad faith. The appellate court ratiocinated
that Section 38, Book I of the Administrative Code is the general law on the civil liability of public
officers while Article 32 of the Civil Code is the special law that governs the instant case.
Consequently, malice or bad faith need not be alleged in the complaint for damages. It also
sustained the ruling of the RTC that the defect of the certification against forum shopping was
cured by the submission of the corporate secretary’s certificate giving authority to its counsel to
execute the same.

Undaunted, petitioner filed the instant recourse contending that the suit is grounded on her acts
done in the performance of her functions as a public officer, hence, it is Section 38, Book I of the
Administrative Code which should be applied. Under this provision, liability will attach only when
there is a clear showing of bad faith, malice, or gross negligence. She further averred that the
Civil Code, specifically, Article 32 which allows recovery of damages for violation of constitutional
rights, is a general law on the liability of public officers; while Section 38, Book I of the
Administrative Code is a special law on the superior public officers’ liability, such that, if the
complaint, as in the instant case, does not allege bad faith, malice, or gross negligence, the
same is dismissible for failure to state a cause of action. As to the defect of the certification
against forum shopping, she urged the Court to strictly construe the rules and to dismiss the
complaint.

Conversely, respondent argued that Section 38 which treats in general the public officers’ "acts"
from which civil liability may arise, is a general law; while Article 32 which deals specifically with
the public officers’ violation of constitutional rights, is a special provision which should determine
whether the complaint states a cause of action or not. Citing the case of Lim v. Ponce de
Leon,14 respondent alleged that under Article 32 of the Civil Code, it is enough that there was a
violation of the constitutional rights of the plaintiff and it is not required that said public officer
should have acted with malice or in bad faith. Hence, it concluded that even granting that the
complaint failed to allege bad faith or malice, the motion to dismiss for failure to state a cause of
action should be denied inasmuch as bad faith or malice are not necessary to hold petitioner
liable.

The issues for resolution are as follows:

(1) May a public officer be validly sued in his/her private capacity for acts done in
connection with the discharge of the functions of his/her office?

(2) Which as between Article 32 of the Civil Code and Section 38, Book I of the
Administrative Code should govern in determining whether the instant complaint states a
cause of action?

(3) Should the complaint be dismissed for failure to comply with the rule on certification
against forum shopping?

(4) May petitioner be held liable for damages?

On the first issue, the general rule is that a public officer is not liable for damages which a person
may suffer arising from the just performance of his official duties and within the scope of his
assigned tasks.15 An officer who acts within his authority to administer the affairs of the office
which he/she heads is not liable for damages that may have been caused to another, as it would
virtually be a charge against the Republic, which is not amenable to judgment for monetary
claims without its consent.16 However, a public officer is by law not immune from damages in
his/her personal capacity for acts done in bad faith which, being outside the scope of his
authority, are no longer protected by the mantle of immunity for official actions. 17

Specifically, under Section 38, Book I of the Administrative Code, civil liability may arise where
there is bad faith, malice, or gross negligence on the part of a superior public officer. And, under
Section 39 of the same Book, civil liability may arise where the subordinate public officer’s act is
characterized by willfulness or negligence. Thus –

Sec. 38. Liability of Superior Officers. – (1) A public officer shall not be civilly liable for
acts done in the performance of his official duties, unless there is a clear showing of bad
faith, malice or gross negligence.

xxxx

Section 39. Liability of Subordinate Officers. – No subordinate officer or employee

shall be civilly liable for acts done by him in good faith in the performance of his duties.
However, he shall be liable for willful or negligent acts done by him which are contrary to
 law, morals, public policy and good customs even if he acts under orders or instructions
of his superior.

In addition, the Court held in Cojuangco, Jr. v. Court of Appeals,18 that a public officer who
directly or indirectly violates the constitutional rights of another, may be validly sued for damages
under Article 32 of the Civil Code even if his acts were not so tainted with malice or bad faith.

Thus, the rule in this jurisdiction is that a public officer may be validly sued in his/her private
capacity for acts done in the course of the performance of the functions of the office, where said
public officer: (1) acted with malice, bad faith, or negligence; or (2) where the public officer
violated a constitutional right of the plaintiff.

Anent the second issue, we hold that the complaint filed by respondent stated a cause of action
and that the decisive provision thereon is Article 32 of the Civil Code.

A general statute is one which embraces a class of subjects or places and does not omit any
subject or place naturally belonging to such class. A special statute, as the term is generally
understood, is one which relates to particular persons or things of a class or to a particular
portion or section of the state only.19

A general law and a special law on the same subject are statutes in pari materia and should,
accordingly, be read together and harmonized, if possible, with a view to giving effect to both.
The rule is that where there are two acts, one of which is special and particular and the other
general which, if standing alone, would include the same matter and thus conflict with the special
act, the special law must prevail since it evinces the legislative intent more clearly than that of a
general statute and must not be taken as intended to affect the more particular and specific
provisions of the earlier act, unless it is absolutely necessary so to construe it in order to give its
words any meaning at all.20

The circumstance that the special law is passed before or after the general act does not change
the principle. Where the special law is later, it will be regarded as an exception to, or a
qualification of, the prior general act; and where the general act is later, the special statute will be
construed as remaining an exception to its terms, unless repealed expressly or by necessary
implication.21

Thus, in City of Manila v. Teotico,22 the Court held that Article 2189 of the Civil Code which holds
provinces, cities, and municipalities civilly liable for death or injuries by reason of defective
conditions of roads and other public works, is a special provision and should prevail over Section
4 of Republic Act No. 409, the Charter of Manila, in determining the liability for defective street
conditions. Under said Charter, the city shall not be held for damages or injuries arising from the
failure of the local officials to enforce the provision of the charter, law, or ordinance, or from
negligence while enforcing or attempting to enforce the same. As explained by the Court:

Manila maintains that the former provision should prevail over the latter, because
Republic Act 409 is a special law, intended exclusively for the City of Manila, whereas the
Civil Code is a general law, applicable to the entire Philippines.

The Court of Appeals, however, applied the Civil Code, and, we think, correctly. It is true
that, insofar as its territorial application is concerned, Republic Act No. 409 is a special
law and the Civil Code a general legislation; but, as regards the subject matter of the
provisions above quoted, Section 4 of Republic Act 409 establishes a general rule
regulating the liability of the City of Manila for "damages or injury to persons or property
arising from the failure of" city officers "to enforce the provisions of" said Act "or any other
law or ordinance, or from negligence" of the city "Mayor, Municipal Board, or other
officers while enforcing or attempting to enforce said provisions." Upon the other hand,
Article 2189 of the Civil Code constitutes a particular prescription making "provinces,
 cities and municipalities . . . liable for damages for the death of, or injury suffered by, any
person by reason" — specifically — "of the defective condition of roads, streets, bridges,
public buildings, and other public works under their control or supervision." In other
words, said section 4 refers to liability arising from negligence, in general,
regardless of the object thereof, whereas Article 2189 governs liability due to
"defective streets," in particular. Since the present action is based upon the
alleged defective condition of a road, said Article 2189 is decisive thereon.23

In the case of Bagatsing v. Ramirez,24 the issue was which law should govern the publication of a
tax ordinance, the City Charter of Manila, a special act which treats ordinances in general and
which requires their publication before enactment and after approval, or the Tax Code, a general
law, which deals in particular with "ordinances levying or imposing taxes, fees or other charges,"
and which demands publication only after approval. In holding that it is the Tax Code which
should prevail, the Court elucidated that:

There is no question that the Revised Charter of the City of Manila is a special act since it
relates only to the City of Manila, whereas the Local Tax Code is a general law because
it applies universally to all local governments. Blackstone defines general law as a
universal rule affecting the entire community and special law as one relating to particular
persons or things of a class. And the rule commonly said is that a prior special law is not
ordinarily repealed by a subsequent general law. The fact that one is special and the
other general creates a presumption that the special is to be considered as remaining an
exception of the general, one as a general law of the land, the other as the law of a
particular case. However, the rule readily yields to a situation where the special
statute refers to a subject in general, which the general statute treats in particular.
Th[is] exactly is the circumstance obtaining in the case at bar. Section 17 of the
Revised Charter of the City of Manila speaks of "ordinance" in general, i.e.,
irrespective of the nature and scope thereof, whereas, Section 43 of the Local Tax
Code relates to "ordinances levying or imposing taxes, fees or other charges" in
particular. In regard, therefore, to ordinances in general, the Revised Charter of the
City of Manila is doubtless dominant, but, that dominant force loses its continuity
when it approaches the realm of "ordinances levying or imposing taxes, fees or
other charges" in particular. There, the Local Tax Code controls. Here, as always, a
general provision must give way to a particular provision. Special provision governs.

Let us examine the provisions involved in the case at bar. Article 32 of the Civil Code provides:

ART. 32. Any public officer or employee, or any private individual, who directly or
indirectly obstructs, defeats, violates, or in any manner impedes or impairs any of the
following rights and liberties of another person shall be liable to the latter for damages:

xxxx

(6) The right against deprivation of property without due process of law;

xxxx

(8) The right to the equal protection of the laws;

xxxx

The rationale for its enactment was explained by Dean Bocobo of the Code Commission, as
follows:
 "DEAN BOCOBO. Article 32, regarding individual rights, Attorney Cirilo Paredes
proposes that Article 32 be so amended as to make a public official liable for violation of
another person’s constitutional rights only if the public official acted maliciously or in bad
faith. The Code Commission opposes this suggestion for these reasons:

"The very nature of Article 32 is that the wrong may be civil or criminal. It is not necessary
therefore that there should be malice or bad faith. To make such a requisite would defeat
the main purpose of Article 32 which is the effective protection of individual rights. Public
officials in the past have abused their powers on the pretext of justifiable motives or good
faith in the performance of their duties. Precisely, the object of the Article is to put an end
to official abuse by the plea of good faith. In the United States this remedy is in the nature
of a tort.

"Mr. Chairman, this article is firmly one of the fundamental articles introduced in the New
Civil Code to implement democracy. There is no real democracy if a public official is
abusing and we made the article so strong and so comprehensive that it concludes an
abuse of individual rights even if done in good faith, that official is liable. As a matter of
fact, we know that there are very few public officials who openly and definitely abuse the
individual rights of the citizens. In most cases, the abuse is justified on a plea of desire to
enforce the law to comply with one’s duty. And so, if we should limit the scope of this
article, that would practically nullify the object of the article. Precisely, the opening object
of the article is to put an end to abuses which are justified by a plea of good faith, which
is in most cases the plea of officials abusing individual rights." 25

The Code Commission deemed it necessary to hold not only public officers but also private
individuals civilly liable for violation of the rights enumerated in Article 32 of the Civil Code. It is
not necessary that the defendant under this Article should have acted with malice or bad faith,
otherwise, it would defeat its main purpose, which is the effective protection of individual rights. It
suffices that there is a violation of the constitutional right of the plaintiff. 26

Article 32 was patterned after the "tort" in American law.27 A tort is a wrong, a tortious act which
has been defined as the commission or omission of an act by one, without right, whereby another
receives some injury, directly or indirectly, in person, property, or reputation. 28 There are cases in
which it has been stated that civil liability in tort is determined by the conduct and not by the
mental state of the tortfeasor, and there are circumstances under which the motive of the
defendant has been rendered immaterial. The reason sometimes given for the rule is that
otherwise, the mental attitude of the alleged wrongdoer, and not the act itself, would determine
whether the act was wrongful. 29 Presence of good motive, or rather, the absence of an evil
motive, does not render lawful an act which is otherwise an invasion of another’s legal right; that
is, liability in tort is not precluded by the fact that defendant acted without evil intent. 30

The clear intention therefore of the legislature was to create a distinct cause of action in the
nature of tort for violation of constitutional rights, irrespective of the motive or intent of the
defendant.31 This is a fundamental innovation in the Civil Code, and in enacting the
Administrative Code pursuant to the exercise of legislative powers, then President Corazon C.
Aquino, could not have intended to obliterate this constitutional protection on civil liberties.

In Aberca v. Ver,32 it was held that with the enactment of Article 32, the principle of accountability
of public officials under the Constitution acquires added meaning and assumes a larger
dimension. No longer may a superior official relax his vigilance or abdicate his duty to supervise
his subordinates, secure in the thought that he does not have to answer for the transgressions
committed by the latter against the constitutionally protected rights and liberties of the citizen.
Part of the factors that propelled people power in February 1986 was the widely held perception
that the government was callous or indifferent to, if not actually responsible for, the rampant
violations of human rights. While it would certainly be too naive to expect that violators of human
rights would easily be deterred by the prospect of facing damage suits, it should nonetheless be
made clear in no uncertain terms that Article 32 of the Civil Code makes the persons who are
directly, as well as indirectly, responsible for the transgression, joint tortfeasors.

On the other hand, Sections 38 and 39, Book I of the Administrative Code, laid down the rule on
the civil liability of superior and subordinate public officers for acts done in the performance of
their duties. For both superior and subordinate public officers, the presence of bad faith, malice,
and negligence are vital elements that will make them liable for damages. Note that while said
provisions deal in particular with the liability of government officials, the subject thereof is
general, i.e., "acts" done in the performance of official duties, without specifying the action or
omission that may give rise to a civil suit against the official concerned.

Contrarily, Article 32 of the Civil Code specifies in clear and unequivocal terms a particular
specie of an "act" that may give rise to an action for damages against a public officer, and that is,
a tort for impairment of rights and liberties. Indeed, Article 32 is the special provision that deals
specifically with violation of constitutional rights by public officers. All other actionable acts of
public officers are governed by Sections 38 and 39 of the Administrative Code. While the Civil
Code, specifically, the Chapter on Human Relations is a general law, Article 32 of the same
Chapter is a special and specific provision that holds a public officer liable for and allows redress
from a particular class of wrongful acts that may be committed by public officers. Compared thus
with Section 38 of the Administrative Code, which broadly deals with civil liability arising from
errors in the performance of duties, Article 32 of the Civil Code is the specific provision which
must be applied in the instant case precisely filed to seek damages for violation of constitutional
rights.

The complaint in the instant case was brought under Article 32 of the Civil Code. Considering
that bad faith and malice are not necessary in an action based on Article 32 of the Civil Code, the
failure to specifically allege the same will not amount to failure to state a cause of action. The
courts below therefore correctly denied the motion to dismiss on the ground of failure to state a
cause of action, since it is enough that the complaint avers a violation of a constitutional right of
the plaintiff.

Anent the issue on non-compliance with the rule against forum shopping, the subsequent
submission of the secretary’s certificate authorizing the counsel to sign and execute the
certification against forum shopping cured the defect of respondent’s complaint. Besides, the
merits of the instant case justify the liberal application of the rules. 33

WHEREFORE, in view of the foregoing, the petition is DENIED. The Decision of the Court of
Appeals dated May 7, 1999 which affirmed the Order of the Regional Trial Court of Marikina,
Branch 272, denying petitioner’s motion to dismiss, is AFFIRMED. The Presiding Judge,
Regional Trial Court of Marikina, Branch 272, is hereby DIRECTED to continue with the
proceedings in Civil Case No. 97-341-MK with dispatch.

With costs.

SO ORDERED.

G.R. No. L-69866 April 15, 1988

ROGELIO ABERCA, RODOLFO BENOSA, NESTOR BODINO NOEL ETABAG DANILO DE

LA FUENTE, BELEN DIAZ-FLORES, MANUEL MARIO GUZMAN, ALAN JAZMINEZ, EDWIN
LOPEZ, ALFREDO MANSOS, ALEX MARCELINO, ELIZABETH PROTACIO-MARCELINO,
JOSEPH OLAYER, CARLOS PALMA, MARCO PALO, ROLANDO SALUTIN, BENJAMIN
SESGUNDO, ARTURO TABARA, EDWIN TULALIAN and REBECCA TULALIAN petitioners,
vs.
MAJ. GEN. FABIAN VER, COL. FIDEL SINGSON, COL. ROLANDO ABADILLA, COL.
GERARDO B. LANTORIA, COL. GALILEO KINTANAR, 1ST LT. COL. PANFILO M. LACSON,
MAJ. RODOLFO AGUINALDO, CAPT. DANILO PIZARRO, 1ST LT. PEDRO TANGO, 1ST LT.
ROMEO RICARDO, 1ST LT. RAUL BACALSO, MSGT BIENVENIDO BALABA and
REGIONAL TRIAL COURT, National Capital Judicial Region, Branch XCV (95), Quezon
City, respondents.

YAP, J.:

This petition for certiorari presents vital issues not heretofore passed upon by this Court. It poses the question whether the suspension
of the privilege of the writ of habeas corpus bars a civil action for damages for illegal searches conducted by military personnel and
other violations of rights and liberties guaranteed under the Constitution. If such action for damages may be maintained, who can be
held liable for such violations: only the military personnel directly involved and/or their superiors as well.

This case stems from alleged illegal searches and seizures and other violations of the rights and
liberties of plaintiffs by various intelligence units of the Armed Forces of the Philippines, known
as Task Force Makabansa (TFM) ordered by General Fabian Ver "to conduct pre-emptive strikes
against known communist-terrorist (CT) underground houses in view of increasing reports about
CT plans to sow disturbances in Metro Manila," Plaintiffs allege, among others, that complying
with said order, elements of the TFM raided several places, employing in most cases defectively
issued judicial search warrants; that during these raids, certain members of the raiding party
confiscated a number of purely personal items belonging to plaintiffs; that plaintiffs were arrested
without proper warrants issued by the courts; that for some period after their arrest, they were
denied visits of relatives and lawyers; that plaintiffs were interrogated in violation of their rights to
silence and counsel; that military men who interrogated them employed threats, tortures and
other forms of violence on them in order to obtain incriminatory information or confessions and in
order to punish them; that all violations of plaintiffs constitutional rights were part of a concerted
and deliberate plan to forcibly extract information and incriminatory statements from plaintiffs and
to terrorize, harass and punish them, said plans being previously known to and sanctioned by
defendants.

Plaintiffs sought actual/compensatory damages amounting to P39,030.00; moral damages in the

amount of at least P150,000.00 each or a total of P3,000,000.00; exemplary damages in the
amount of at least P150,000.00 each or a total of P3,000,000.00; and attorney's fees amounting
to not less than P200,000.00.

A motion to dismiss was filed by defendants, through their counsel, then Solicitor-General
Estelito Mendoza, alleging that (1) plaintiffs may not cause a judicial inquiry into the
circumstances of their detention in the guise of a damage suit because, as to them, the privilege
of the writ of habeas corpus is suspended; (2) assuming that the courts can entertain the present
action, defendants are immune from liability for acts done in the performance of their official
duties; and (3) the complaint states no cause of action against the defendants. Opposition to said
motion to dismiss was filed by plaintiffs Marco Palo, Danilo de la Fuente, Benjamin Sesgundo,
Nel Etabag, Alfredo Mansos and Rolando Salutin on July 8, 1983, and by plaintiffs Edwin Lopez,
Manuel Mario Guzman, Alan Jasminez, Nestor Bodino, Carlos Palma, Arturo Tabara, Joseph
Olayer, Rodolfo Benosa, Belen Diaz, Flores, Rogelio Aberca, Alex Marcelino and Elizabeth
Marcelino on July 21, 1983. On November 7, 1983, a Consolidated Reply was filed by
defendants' counsel.

Then, on November 8, 1983, the Regional Trial Court, National Capital Region, Branch 95,
Judge Willelmo C. Fortun, Presiding,   issued a resolution granting the motion to dismiss. I
1

sustained, lock, stock and barrel, the defendants' contention (1) the plaintiffs may not cause a
judicial inquiry into the circumstances of their detention in the guise of a damage suit because, as
to them, the privilege of the writ of habeas corpus is suspended; (2) that assuming that the court
can entertain the present action, defendants are immune from liability for acts done in the
performance of their official duties; and (3) that the complaint states no cause of action against
defendants, since there is no allegation that the defendants named in the complaint confiscated
plaintiffs' purely personal properties in violation of their constitutional rights, and with the possible
exception of Major Rodolfo Aguinaldo and Sergeant Bienvenido Balabo committed acts of torture
and maltreatment, or that the defendants had the duty to exercise direct supervision and control
of their subordinates or that they had vicarious liability as employers under Article 2180 of the
Civil Code. The lower court stated, "After a careful study of defendants' arguments, the court
finds the same to be meritorious and must, therefore, be granted. On the other hand, plaintiffs'
arguments in their opposition are lacking in merit."

A motion to set aside the order dismissing the complaint and a supplemental motion for
reconsideration was filed by the plaintiffs on November 18, 1983, and November 24, 1983,
respectively. On December 9, 1983, the defendants filed a comment on the aforesaid motion of
plaintiffs, furnishing a copy thereof to the attorneys of all the plaintiffs, namely, Attys. Jose W.
Diokno, Procopio Beltran, Rene Sarmiento, Efren Mercado, Auguso Sanchez, Antonio L.
Rosales, Pedro B. Ella Jr., Arno V. Sanidad, Alexander Padilla, Joker Arroyo, Rene Saguisag,
Ramon Esguerra and Felicitas Aquino.

On December 15, 1983, Judge Fortun issued an order voluntarily inhibiting himself from further
proceeding in the case and leaving the resolution of the motion to set aside the order of dismissal
to Judge Lising, "to preclude any suspicion that he (Judge Fortun) cannot resolve [the] aforesaid
pending motion with the cold neutrality of an impartial judge and to put an end to plaintiffs
assertion that the undersigned has no authority or jurisdiction to resolve said pending motion."
This order prompted plaintiffs to reesolve an amplificatory motion for reconsideration signed in
the name of the Free Legal Assistance Group (FLAG) of Mabini Legal Aid Committee, by Attys.
Joker P. Arroyo, Felicitas Aquino and Arno Sanidad on April 12, 1984. On May 2,1984, the
defendants filed a comment on said amplificatory motion for reconsideration.

In an order dated May 11, 1984, the trial court, Judge Esteban Lising, Presiding, without acting
on the motion to set aside order of November 8, 1983, issued an order, as follows:

It appearing from the records that, indeed, the following plaintiffs, Rogelio Aberca,
Danilo de la Fuente and Marco Palo, represented by counsel, Atty. Jose W.
Diokno, Alan Jasminez represented by counsel, Atty. Augusta Sanchez, Spouses
Alex Marcelino and Elizabeth Protacio-Marcelino, represented by counsel, Atty.
Procopio Beltran, Alfredo Mansos represented by counsel, Atty. Rene Sarmiento,
and Rolando Salutin, represented by counsel, Atty. Efren Mercado, failed to file a
motion to reconsider the Order of November 8, 1983, dismissing the complaint,
nor interposed an appeal therefrom within the reglementary period, as prayed for
by the defendants, said Order is now final against said plaintiffs.

Assailing the said order of May 11, 1984, the plaintiffs filed a motion for reconsideration on May
28,1984, alleging that it was not true that plaintiffs Rogelio Aberca, Danilo de la Fuente, Marco
Palo, Alan Jasminez, Alex Marcelino, Elizabeth Protacio-Marcelino, Alfredo Mansos and Rolando
Salutin failed to file a motion to reconsider the order of November 8, 1983 dismissing the
complaint, within the reglementary period. Plaintiffs claimed that the motion to set aside the order
of November 8, 1983 and the amplificatory motion for reconsideration was filed for all the
plaintiffs, although signed by only some of the lawyers.

In its resolution of September 21, 1984, the respondent court dealt with both motions (1) to
reconsider its order of May 11, 1984 declaring that with respect to certain plaintiffs, the resolution
of November 8, 1983 had already become final, and (2) to set aside its resolution of November 8,
1983 granting the defendants' motion to dismiss. In the dispositive portion of the order of
September 21, 1984, the respondent court resolved:

(1) That the motion to set aside the order of finality, dated May 11, 1984, of the
Resolution of dismissal of the complaint of plaintiffs Rogelio Aberca, Danilo de la
 Fuente, Marco Palo, Alan Jasminez Alex Marcelino, Elizabeth Protacio-
Marcelino, Alfredo Mansos and Rolando Salutin is deed for lack of merit;

(2) For lack of cause of action as against the following defendants, to wit:

1. Gen Fabian Ver

2. Col. Fidel Singson

3. Col. Rolando Abadilla

4. Lt. Col. Conrado Lantoria, Jr.

5. Col. Galileo Montanar

6. Col. Panfilo Lacson

7. Capt. Danilo Pizaro

8. 1 Lt Pedro Tango

9. Lt. Romeo Ricardo

10. Lt. Raul Bacalso

the motion to set aside and reconsider the Resolution of dismissal of the present
action or complaint, dated November 8, 1983, is also denied but in so far as it
affects and refers to defendants, to wit:

1. Major Rodolfo Aguinaldo, and

2. Master Sgt. Bienvenido Balaba

the motion to reconsider and set aside the Resolution of dismissal dated
November 3, 1983 is granted and the Resolution of dismissal is, in this respect,
reconsidered and modified.

Hence, petitioners filed the instant petition for certiorari on March 15, 1985 seeking to annul and
set aside the respondent court's resolution of November 8, 1983, its order of May 11, 1984, and
its resolution dated September 21, 1984. Respondents were required to comment on the petition,
which it did on November 9, 1985. A reply was filed by petitioners on August 26, 1986.

We find the petition meritorious and decide to give it due course.

At the heart of petitioners' complaint is Article 32 of the Civil Code which provides:

ART. 32. Any public officer or employee, or any private individual who directly or
indirectly obstructs, defeats, violates or in any manner impedes or impairs any of
the following rights and liberties of another person shall be liable to the latter for
damages:

(1) Freedom of religion;

(2) Freedom of speech;

(3) Freedom to write for the press or to maintain a periodical publication;

(4) Freedom from arbitrary or illegal detention;

(5) Freedom of suffrage;

(6) The right against deprivation of property without due process

(7) of law;

(8) The right to a just compensation when private property is taken for public use;

(9) The right to the equal protection of the laws;

(10) The right to be secure in one's person, house, papers, and effects against
unreasonable searches and seizures;

(11) The liberty of abode and of changing the same;

(12) The privacy of cmmunication and correspondence;

(13) The right to become a member of associations or societies for purposes not
contrary to law;

(14) The right to take part in a peaceable assembly to petition the Government for
redress of grievances;

(15) The right to be free from involuntary servitude in any form;

(16) The rigth of the accused against excessive bail;

(17) The rigth of the aaccused to be heard by himself and counsel, to be informed
of the nature and cause of the accusation against him, to have a speedy and
public trial, to meet the witnesses face to face, and to have compulsory process
to secure the attendance of witness in behalf;

(18) Freedom from being compelled to be a witness against ones self, or from
being forced to confess guilt, or from being induced by a promise of immunity or
reward to make such confession, except when the person confessing becomes a
State witness;

(19) Freedom from excessive fines or cruel and unusual punishment, unless the
same is imposed or inflicted in accordance with a statute which has not been
judicially declared unconstitutional; and

(20) Freedom of access to the courts.

In any of the cases referred to in this article, whether or not the defendant's act or
omission constitutes a criminal offense, the against grieved party has a right to
commence an entirely separate and distinct civil action for damages, and for
other relief. Such civil action shall proceed independently of any criminal
prosecution (if the latter be instituted), and may be proved by a preponderance of
evidence.
 The indemnity shall include moral damages. Exemplary damages may also be
adjudicated.

The responsibility herein set forth is not demandable from a judge unless his act
or omission constitutes a violation of the Penal Code or other penal statute.

It is obvious that the purpose of the above codal provision is to provide a sanction to the deeply
cherished rights and freedoms enshrined in the Constitution. Its message is clear; no man may
seek to violate those sacred rights with impunity. In times of great upheaval or of social and
political stress, when the temptation is strongest to yield — borrowing the words of Chief Justice
Claudio Teehankee — to the law of force rather than the force of law, it is necessary to remind
ourselves that certain basic rights and liberties are immutable and cannot be sacrificed to the
transient needs or imperious demands of the ruling power. The rule of law must prevail, or else
liberty will perish. Our commitment to democratic principles and to the rule of law compels us to
reject the view which reduces law to nothing but the expression of the will of the predominant
power in the community. "Democracy cannot be a reign of progress, of liberty, of justice, unless
the law is respected by him who makes it and by him for whom it is made. Now this respect
implies a maximum of faith, a minimum of Idealism. On going to the bottom of the matter, we
discover that life demands of us a certain residuum of sentiment which is not derived from
reason, but which reason nevertheless controls.  2

Seeking to justify the dismissal of plaintiffs' complaint, the respondents postulate the view that as
public officers they are covered by the mantle of state immunity from suit for acts done in the
performance of official duties or function In support of said contention, respondents maintain that
—

Respondents are members of the Armed Forces of the Philippines. Their primary
duty is to safeguard public safety and order. The Constitution no less provides
that the President may call them "to prevent or supress lawless violence,
invasion, insurrection or rebellion, or imminent danger thereof." (Constitution,
Article VII, Section 9).

On January 17, 1981, the President issued Proclamation No. 2045 lifting martial
law but providing for the continued suspension of the privilege of the writ of
habeas corpus in view of the remaining dangers to the security of the nation. The
proclamation also provided "that the call to the Armed Forces of the Philippines to
prevent or suppress lawless violence, insuitection rebellion and subversion shall
continue to be in force and effect."

Petitioners allege in their complaint that their causes of action proceed from
respondent General Ver's order to Task Force Makabansa to launch pre-emptive
strikes against communist terrorist underground houses in Metro Manila.
Petitioners claim that this order and its subsequent implementation by elements
of the task force resulted in the violation of their constitutional rights against
unlawful searches, seizures and arrest, rights to counsel and to silence, and the
right to property and that, therefore, respondents Ver and the named members of
the task force should be held liable for damages.

But, by launching a pre-emptive strike against communist terrorists, respondent

members of the armed forces merely performed their official and constitutional
duties. To allow petitioners to recover from respondents by way of damages for
acts performed in the exercise of such duties run contrary to the policy
considerations to shield respondents as public officers from undue interference
with their duties and from potentially disabling threats of hability (Aarlon v.
Fitzgerald 102 S. Ct. 2731-1 Forbes v. Chuoco Tiaco, 16 Phil. 634), and upon the
necessity of protecting the performance of governmental and public functions
 from being harassed unduly or constantly interrupted by private suits (McCallan
v. State, 35 Cal. App. 605; Metran v. Paredes, 79 Phil. 819).

xxx xxx xxx

The immunity of public officers from liability arising from the performance of their
duties is now a settled jurisprudence Alzua v. Johnson, 21 Phil. 308; Zulueta v.
Nicolas, 102 Phil. 944; Spalding v. Vilas, 161 US 483; 40 L. Ed. 780, 16 S. Ct.
631; Barr v. Mateo, 360; Butz v. Economon, 438 US 478; 57 L. Ed. 2d 895, 98 S.
Ct. 2894; Scheuer v. Rhodes, 416 US 232; Forbes v. Chuoco Tiaco, supra; Miller
v. de Leune, 602 F. 2d 198; Sami v. US, 617 F. 2d 755).

Respondents-defendants who merely obeyed the lawful orders of the President

and his call for the suppression of the rebellion involving petitioners enjoy such
immunity from Suit. 3

We find respondents' invocation of the doctrine of state immunity from suit totally misplaced. The
cases invoked by respondents actually involved acts done by officers in the performance of
official duties written the ambit of their powers. As held in Forbes, etc. vs. Chuoco Tiaco and
Crossfield: 4

No one can be held legally responsible in damages or otherwise for doing in a

legal manner what he had authority, under the law, to do. Therefore, if the
Governor-General had authority, under the law to deport or expel the defendants,
and circumstances justifying the deportation and the method of carrying it out are
left to him, then he cannot be held liable in damages for the exercise of this
power. Moreover, if the courts are without authority to interfere in any manner, for
the purpose of controlling or interferring with the exercise of the political powers
vested in the chief executive authority of the Government, then it must follow that
the courts cannot intervene for the purpose of declaring that he is liable in
damages for the exeercise of this authority.

It may be that the respondents, as members of the Armed Forces of the Philippines, were merely
responding to their duty, as they claim, "to prevent or suppress lawless violence, insurrection,
rebellion and subversion" in accordance with Proclamation No. 2054 of President Marcos,
despite the lifting of martial law on January 27, 1981, and in pursuance of such objective, to
launch pre- emptive strikes against alleged communist terrorist underground houses. But this
cannot be construed as a blanket license or a roving commission untramelled by any
constitutional restraint, to disregard or transgress upon the rights and liberties of the individual
citizen enshrined in and protected by the Constitution. The Constitution remains the supreme law
of the land to which all officials, high or low, civilian or military, owe obedience and allegiance at
all times.

Article 32 of the Civil Code which renders any public officer or employee or any private individual
liable in damages for violating the Constitutional rights and liberties of another, as enumerated
therein, does not exempt the respondents from responsibility. Only judges are excluded from
liability under the said article, provided their acts or omissions do not constitute a violation of the
Penal Code or other penal statute.

This is not to say that military authorities are restrained from pursuing their assigned task or
carrying out their mission with vigor. We have no quarrel with their duty to protect the Republic
from its enemies, whether of the left or of the right, or from within or without, seeking to destroy
or subvert our democratic institutions and imperil their very existence. What we are merely trying
to say is that in carrying out this task and mission, constitutional and legal safeguards must be
observed, otherwise, the very fabric of our faith will start to unravel. In the battle of competing
Ideologies, the struggle for the mind is just as vital as the struggle of arms. The linchpin in that
psychological struggle is faith in the rule of law. Once that faith is lost or compromised, the
struggle may well be abandoned.

We do not find merit in respondents' suggestion that plaintiffs' cause of action is barred by the
suspension of the privilege of the writ of habeas corpus. Respondents contend that "Petitioners
cannot circumvent the suspension of the privilege of the writ by resorting to a damage suit aimed
at the same purpose-judicial inquiry into the alleged illegality of their detention. While the main
relief they ask by the present action is indemnification for alleged damages they suffered, their
causes of action are inextricably based on the same claim of violations of their constitutional
rights that they invoked in the habeas corpus case as grounds for release from detention. Were
the petitioners allowed the present suit, the judicial inquiry barred by the suspension of the
privilege of the writ will take place. The net result is that what the courts cannot do, i.e. override
the suspension ordered by the President, petitioners will be able to do by the mere expedient of
altering the title of their action."

We do not agree. We find merit in petitioners' contention that the suspension of the privilege of
the writ of habeas corpus does not destroy petitioners' right and cause of action for damages for
illegal arrest and detention and other violations of their constitutional rights. The suspension does
not render valid an otherwise illegal arrest or detention. What is suspended is merely the right of
the individual to seek release from detention through the writ of habeas corpus as a speedy
means of obtaining his liberty.

Moreover, as pointed out by petitioners, their right and cause of action for damages are explicitly
recognized in P.D. No. 1755 which amended Article 1146 of the Civil Code by adding the
following to its text:

However, when the action (for injury to the rights of the plaintiff or for a quasi-
delict) arises from or out of any act, activity or conduct of any public officer
involving the exercise of powers or authority arising from Martial Law including
the arrest, detention and/or trial of the plaintiff, the same must be brought within
one (1) year.

Petitioners have a point in contending that even assuming that the suspension of the privilege of
the writ of habeas corpus suspends petitioners' right of action for damages for illegal arrest and
detention, it does not and cannot suspend their rights and causes of action for injuries suffered
because of respondents' confiscation of their private belongings, the violation of their right to
remain silent and to counsel and their right to protection against unreasonable searches and
seizures and against torture and other cruel and inhuman treatment.

However, we find it unnecessary to address the constitutional issue pressed upon us. On March
25, 1986, President Corazon C. Aquino issued Proclamation No. 2, revoking Proclamation Nos.
2045 and 2045-A and lifting the suspension of the privilege of the writ of habeas corpus. The
question therefore has become moot and academic.

This brings us to the crucial issue raised in this petition. May a superior officer under the notion of
respondent superior be answerable for damages, jointly and severally with his subordinates, to
the person whose constitutional rights and liberties have been violated?

Respondents contend that the doctrine of respondent superior is applicable to the case. We
agree. The doctrine of respondent superior has been generally limited in its application to
principal and agent or to master and servant (i.e. employer and employee) relationship. No such
relationship exists between superior officers of the military and their subordinates.

Be that as it may, however, the decisive factor in this case, in our view, is the language of Article
32. The law speaks of an officer or employee or person 'directly' or "indirectly" responsible for the
violation of the constitutional rights and liberties of another. Thus, it is not the actor alone (i.e. the
one directly responsible) who must answer for damages under Article 32; the person indirectly
responsible has also to answer for the damages or injury caused to the aggrieved party.

By this provision, the principle of accountability of public officials under the Constitution   acquires
5

added meaning and asgilrnes a larger dimension. No longer may a superior official relax his
vigilance or abdicate his duty to supervise his subordinates, secure in the thought that he does
not have to answer for the transgressions committed by the latter against the constitutionally
protected rights and liberties of the citizen. Part of the factors that propelled people power in
February 1986 was the widely held perception that the government was callous or indifferent to,
if not actually responsible for, the rampant violations of human rights. While it would certainly be
go naive to expect that violators of human rights would easily be deterred by the prospect of
facing damage suits, it should nonetheless be made clear in no ones terms that Article 32 of the
Civil Code makes the persons who are directly, as well as indirectly, responsible for the
transgression joint tortfeasors.

In the case at bar, the trial court dropped defendants General Fabian Ver, Col. Fidel Singson,
Col. Rolando Abadilla, Col. Gerardo Lantoria, Jr., Col. Galileo Kintanar, Col. Panfilo Lacson,
Capt. Danilo Pizarro, lst Lt. Pedro Tango, Lt. Romeo Ricardo and Lt. Ricardo Bacalso from the
acts of their subordinates. Only Major Rodolfo Aguinaldo and Master Sgt. Bienvenido Balaba
were kept as defendants on the ground that they alone 'have been specifically mentioned and
Identified to have allegedly caused injuries on the persons of some of the plaintiff which acts of
alleged physical violence constitute a delict or wrong that gave rise to a cause of action. But such
finding is not supported by the record, nor is it in accord with law and jurisprudence.

Firstly, it is wrong to at the plaintiffs' action for damages 5 Section 1, Article 19. to 'acts of alleged
physical violence" which constituted delict or wrong. Article 32 clearly specifies as actionable the
act of violating or in any manner impeding or impairing any of the constitutional rights and
liberties enumerated therein, among others —

1. Freedom from arbitrary arrest or illegal detention;

2. The right against deprivation of property without due process of law;

3. The right to be secure in one's person, house, papers and effects against
unreasonable searches and seizures;

4. The privacy of communication and correspondence;

5. Freedom from being compelled to be a witness against one's self, or from

being forced to confess guilt, or from being induced by a promise of immunity or
reward to make a confession, except when the person confessing becomes a
state witness.

The complaint in this litigation alleges facts showing with abundant clarity and details, how
plaintiffs' constitutional rights and liberties mentioned in Article 32 of the Civil Code were violated
and impaired by defendants. The complaint speaks of, among others, searches made without
search warrants or based on irregularly issued or substantially defective warrants; seizures and
confiscation, without proper receipts, of cash and personal effects belonging to plaintiffs and
other items of property which were not subversive and illegal nor covered by the search
warrants; arrest and detention of plaintiffs without warrant or under irregular, improper and illegal
circumstances; detention of plaintiffs at several undisclosed places of 'safehouses" where they
were kept incommunicado and subjected to physical and psychological torture and other
inhuman, degrading and brutal treatment for the purpose of extracting incriminatory statements.
The complaint contains a detailed recital of abuses perpetrated upon the plaintiffs violative of
their constitutional rights.
Secondly, neither can it be said that only those shown to have participated "directly" should be
held liable. Article 32 of the Civil Code encompasses within the ambit of its provisions those
directly, as well as indirectly, responsible for its violation.

The responsibility of the defendants, whether direct or indirect, is amply set forth in the complaint.
It is well established in our law and jurisprudence that a motion to dismiss on the ground that the
complaint states no cause of action must be based on what appears on the face of the
complaint.   To determine the sufficiency of the cause of action, only the facts alleged in the
6

complaint, and no others, should be considered.   For this purpose, the motion to dismiss must
7

hypothetically admit the truth of the facts alleged in the complaint.  8

Applying this test, it is difficult to justify the trial court's ruling, dismissing for lack of cause of
action the complaint against all the defendants, except Major Rodolfo Aguinaldo and Master Sgt.
Bienvenido Balaba. The complaint contained allegations against all the defendants which, if
admitted hypothetically, would be sufficient to establish a cause or causes of action against all of
them under Article 32 of the Civil Code.

This brings us to the last issue. Was the trial court correct in dismissing the complaint with
respect to plaintiffs Rogelio Aberca, Danilo de la Puente, Marco Palo, Alan Jazminez, Alex
Marcelino, Elizabeth Protacio-Marcelino, Alfredo Mansos and Rolando Salutin, on the basis of
the alleged failure of said plaintiffs to file a motion for reconsideration of the court's resolution of
November 8, 1983, granting the respondent's motion to dismiss?

It is undisputed that a timely motion to set aside said order of November 8, 1983 was filed by
'plaintiffs, through counsel. True, the motion was signed only by Atty. Joker P. Arroyo, counsel
for Benjamin Sesgulido; Atty. Antonio Rosales, counsel for Edwin Lopez and Manuel Martin
Guzman; Atty. Pedro B. Ella, Jr., counsel for Nestor Bodino and Carlos Palma; Atty. Arno V.
Sanidad, counsel for Arturo Tabara; Atty. Felicitas S. Aquino, counsel for Joseph Olayer; and
Atty. Alexander Padilla, counsel for Rodolfo Benosa.

But the body of the motion itself clearly indicated that the motion was filed on behalf of all the
plaintiffs. And this must have been also the understanding of defendants' counsel himself for
when he filed his comment on the motion, he furnished copies thereof, not just to the lawyers
who signed the motion, but to all the lawyers of plaintiffs, to wit: Attys. Jose Diokno, Procopio
Beltran, Rene Sarmiento, Efren Mercado, Augusto Sanchez, Antonio Rosales, Pedro Efla Jr.,
Arno Sanidad, Alexander Padilla, Joker Arroyo, Rene Saguisag, Ramon Esguerra and Felicitas
S. Aquino.

In filing the motion to set aside the resolution of November 8, 1983, the signing attorneys did so
on behalf of all the plaintiff. They needed no specific authority to do that. The authority of an
attorney to appear for and in behalf of a party can be assumed, unless questioned or challenged
by the adverse party or the party concerned, which was never done in this case. Thus, it was
grave abuse on the part of respondent judge to take it upon himself to rule that the motion to set
aside the order of November 8, 1953 dismissing the complaint was filed only by some of the
plaintiffs, when by its very language it was clearly intended to be filed by and for the benefit of all
of them. It is obvious that the respondent judge took umbrage under a contrived technicality to
declare that the dismissal of the complaint had already become final with respect to some of the
plaintiffs whose lawyers did not sign the motion for reconsideration. Such action tainted with legal
infirmity cannot be sanctioned.

Accordingly, we grant the petition and annul and set aside the resolution of the respondent court,
dated November 8, 1983, its order dated May 11, 1984 and its resolution dated September 21,
1984. Let the case be remanded to the respondent court for further proceedings. With costs
against private respondents.

SO ORDERED.
G.R. No. L-34529 January 27, 1983

MAXIMO MARCIA, AMALIA MOJICA, TIRSO YAP, DAMIANA MARCIA, EDGAR MARCIA,
and RENATO YAP, petitioners,
vs.
COURT OF APPEALS, FELARDO PAJE, and VICTORY LINER, INC., respondents.

Ricardo J. Francisco, for petitioners.

Flors, Macapagal, Ocampo & Dizon for private respondents.

RELOVA, J.:

Appeal by certiorari from the decision of the Court of Appeals affirming the judgment of the Court
of First Instance of Rizal, which dismissed the complaint filed by tile petitioners against private
respondents in the concept of an independent civil action for damages for physical injuries
resulting from reckless imprudence.

On December 23, 1956, in the municipality of Lubao, Pampanga, a passenger bus operated by
private respondent Victory Liner, Inc. and driven by its employee. private respondent Felardo
Paje, collided with a jeep driven by Clemente Marcia, resulting in the latter's death and in
physical injuries to herein petitioners, Edgar Marcia and Renato Yap. Thereupon, an information
for homicide and serious physical injuries thru reckless imprudence was filed against Felardo
Paje in the Court of First Instance of Pampanga (Criminal Case No. 2745).

On January 23, 1957, an action for damages (Civil Case No. 4425) was filed in the Court of First
Instance of Rizal by Edgar Marcia and Renato Yap, together with their respective parents.
against the Victory Liner, Inc. and Felardo Paje, alleging that, the mishap was due to the reckless
imprudence and negligence of the latter in driving the passenger bus.

While said Civil Case No. 4425 was in progress in the Court of First Instance of Rizal, the
criminal action proceeded in the Court of First Instance of Pampanga (Criminal Case No. 2745).
The accused Felardo Paje was convicted of the offense charged. However, on appeal to the
Court of Appeals, he was acquitted in a decision promulgated on November 3, 1982, based on
the findings, to wit:

1 That the Victory Liner bus left its post, kilometer post no. 156, in San Marcelino,
Zambales, at about 2:00 AM

2 That on the highway at Lubao, Pampanga, between Posts Nos. 83 and 84, the
appellant driver thereof, saw a cargo truck parked in the middle of the right lane
of the road to Manila, without

3 That appellant slackened the speed of his truck from 60 km. p.h. to 35 or 40
km. p. h. in order to pass said truck;

4 That the appellant did not see the oncoming jeep until it swerved to the left.

5 That the jeep was still far so appellant attempted to pass the truck but before he
could do so, the jeep came very fast at the center of the road and out of its lane.
 6 That the passengers of the bus shouted at the appellant to bring the bus to the
side so as to avoid a frontal collision with he jeep, and appellant brought his bus
to the right shoulder of the road going to Bataan;

7 That the jeep driven by the deceased Clemente Marcia was running at a fast
pace for which reason the driver lost control and veered sharply to the right
shoulder of the road and crashed into the bus, parked thereat a few seconds
before.

8 That appellant was not speeding, was diligent, and hence, not liable for the
collision which at the least, was a fortuitous event for which no one was
responsible.

and the conclusion that "CRIMINAL NEGLIGENCE is WANTING in this case, and that appellant
was NOT even guilty of CIVIL NEGLIGENCE, Insofar as appellant was concerned, it was a case
of PURE ACCIDENT."

As a consequence, herein private respondents, defendants in Civil Case No. 4425 of the Court of
First Instance of Rizal, moved for the dismissal of the complaint invoking the decision of the
Court of Appeals acquitting Felardo Paje and citing Section I (d), Rule 107 of the Rules of Court
now Section 3 (c), Rule I I I of the New Rules of Court), which reads:

SECTION 1. Rules governing civil actions arising from offenses. — Except as

otherwise provided by law, the following rules shall be observed:

xxx xxx xxx

(d) Extinction of the penal action does not carry with it extinction of the civil,
unless the extinction proceeds from a declaration in a final judgment that the fact
from which the civil might arise did not exist. In the other cases, the persons
entitled to the civil action may institute it in the jurisdiction and in the manner
provided by law against the person who may be liable for restitution of the thing
and reparation or indemnity for the damages suffered.

The trial court denied the motion to dismiss and, thereafter, continued to hear defendants' (herein
private respondents) evidence. The following were presented as defendants' evidence in chief:

(a) the whole record of Criminal Case No. 2745 of the Court of First Instance of
Pampanga in which defendant Felardo Paje was by reason of the occurrence
prosecuted criminally and convicted of homicide with serious physical injuries
thru reckless imprudence;

(b) the decision of the Court of Appeals in CA-G.R. No. 01691 Cr, acquitting the
accused; and

(c) copy of the brief of the said defendant as accused-appellant in the said Court
of Appeals case.

On August 10, 1966, the Court of First Instance of Rizal rendered a decision dismissing plaintiffs'
complaint against the defendants Victory Liner, Inc. and Felardo Paje, without pronouncement as
to costs.

Petitioners appealed the case to the (Court of Appeals CA-G.R. No. 38964-R) alleging that the
acquittal of Paje in the criminal action for homicide and serious physical injuries thru reckless
imprudence "is not a ground for dismissing the complaint in the instant civil action; that the
instant civil action is entirely separate and distinct from the criminal action and shall proceed
independently of the criminal prosecution, so that whatever may have been the result of the
criminal action is irrelevant to this civil action; that Section 2 of Rule 111 of the Rules of Court
and not Section 3, paragraph (c) of the said rule applies; that the statement in the decision of the
Court of Appeals in the criminal action that defendant Paje as accused therein was not guilty of
civil negligence is without the jurisdiction of the said Court to make and is to be completely
disregarded as an extraneous, officious and void statement which cannot affect in any way the
instant civil action; that the records of the criminal action against defendant Paje are inadmissible
evidence; that it has been established in the case at bar, not only by preponderance of evidence
but by uncontradicted, conclusive evidence that petitioners suffered damages as a proximate
result of the negligence of respondent Paje and that it has been established, not only by
preponderance of evidence but by uncontradicted, conclusive evidence, that the damages
suffered by petitioners as a result of the negligence of private respondents is in the amount of
P250,817.96, and that the latter should be sentenced, jointly and severally, to pay the same to
petitioner.

In the meantime, the heirs of Clemente Marcia who, as aforesaid, died as a result of the collision,
instituted a separate civil action in the Court of First Instance of Rizal (Civil Case No. 6880) for
damages based on the alleged reckless imprudence of bus driver Felardo Paje, praying that the
driver and the Victory Liner, Inc. be ordered to pay jointly and severally the amount of damages
claimed. The complaint of the heirs of Clemente Marcia was dismissed by the trial court. Appeal
on questions of law was taken to this Court (Laura Corpus et al vs. Felardo Paje at al, 28 SCRA
1062) which, however, affirmed the order for the reason, among others, that "(1) The acquittal of
the defendant Felardo Paje by the Court of Appeals in the criminal action on the ground that the
reckless imprudence or criminal negligence charged against him did not exist and that the
collision was a case of pure accident, was a bar to the civil action for damages for the death of
Clemente Marcia, which action was based upon the same criminal negligence of which the
defendant Felardo Paje was acquitted in the criminal action."

Following the ruling of this Court in the Corpus vs. Paje decision, respondent Court of Appeals
held that the private respondents Cannot be held civilly liable after it had ruled in the criminal
action that negligence was wanting and that the collision was a case of pure accident.

Dissatisfied with the decision, petitioners have come to US alleging that the Court of Appeals
erred:

I.

IN NOT HOLDING THAT PETITIONERS INSTANT CIVIL ACTION FOR

DAMAGES AGAINST PRIVATE RESPONDENTS FOR PHYSICAL INJURIES
RESULTING FROM NEGLIGENCE IS AN INDEPENDENT ONE, ENTIRELY
SEPARATE AND DISTINCT FROM THE CRIMINAL ACTION, UNDER THE
PROVISIONS OF ARTICLES 33, 2176 AND 2177 OF THE NEW (CIVIL CODE
AND SECTION 2 OF RULE 111 OF THE RULES OF COURT. AND IN INSTEAD
HOLDING THAT THE INSTANT ACTION IS NOT AMONG THE INDEPENDENT
CIVIL ACTIONS AUTHORIZED BY THE SAID PROVISIONS.

II.

IN NOT HOLDING THAT THE ACQUITTAL OF RESPONDENT FELARDO

PAJE, DRIVER OF RESPONDENT VICTORY LINER, INC., IN THE CRIMINAL
ACTION BASED ON THE SAID PHYSICAL INJURIES AND NEGLIGENCE IS
ENTIRELY IRRELEVANT TO THE INSTANT CIVIL ACTION FOR DAMAGES BY
VIRTUE OF THE AFORECITED PROVISIONS OF THE NEW CIVIL CODE AND
THE RULES OF COURT, AND IN INSTEAD HOLDING THAT THE SAID
ACQUITTAL IS A BAR TO THE INSTANT CIVIL ACTION UNDER SECTION 3
 (c) OF RULE I I I AND SECTION 49 (c) OF RULE 39 OF THE RULES OF
COURT.

III.

IN NOT HOLDING THAT THE EVIDENCE ADDUCED BY PRIVATE

RESPONDENTS IN THE INSTANT CIVIL ACTION FOR DAMAGES,
CONSISTING OF THE RECORDS OF THE CRIMINAL ACTION IN THE TRIAL
COURT, THE DECISION OF THE COURT OF APPEALS ACQUITTING
RESPONDENT PAJE AND THE COPY OF THE BRIEF OF THE SAID
RESPONDENT AS ACCUSED-APPELLANT, ARE INADMISSIBLE IN THE
INSTANT CIVIL ACTION FOR DAMAGES.

IV.

IN NOT HOLDING THAT IT HAS BEEN ESTABLISHED IN THE CASE AT BAR,

NOT ONLY BY PREPONDERANCE OF EVIDENCE BUT BY
UNCONTRADICTED, CONCLUSIVE EVIDENCE, THAT PETITIONERS
SUFFERED DAMAGES AS A PROXIMATE RESULT OF THE NEGLIGENCE OF
RESPONDENT PAJE.

V.

IN NOT HOLDING THAT IT HAS BEEN ESTABLISHED, NOT ONLY BY

PREPONDERANCE OF EVIDENCE BUT BY UNCONTRADICTED,
CONCLUSIVE EVIDENCE, THAT THE DAMAGES SUFFERED BY
PETITIONERS AS A RESULT OF THE NEGLIGENCE OF DEFENDANTS IS IN
THE AMOUNT OF P250,817.96, AND IN NOT SENTENCING PRIVATE
RESPONDENTS JOINTLY AND SEVERALLY TO PAY THE SAME TO
PETITIONERS.

It is the stand of herein petitioners that Section 2, Rule 111 of the Rules of Court, not Section 3
(c) thereof, should apply in the case at bar.

Sec. 2. Independent civil action. — In the cases provided for in Articles 31, 32,
33, 34 and 2177 of the Civil Code of the Philippines, an independent civil action
entirely separate and distinct from the criminal action, may be brought by the
injured party during the pendency of the criminal case, provided the right is
reserved as required in the preceding section. Such civil action shall proceed
independently of the criminal prosecution, and shall require only a preponderance
of evidence.

We do not agree, Section 2 of Rule 111 merely refers to the institution of an independent civil
action without waiting for the filing or termination of the criminal action and requires only
preponderance of evidence to prosper and not proof beyond reasonable doubt as required for
conviction in criminal cases. However, an acquittal based on the finding that the facts upon which
civil liability did not exist, bars the filing of an independent civil action if it is based on the crime.
As early as 1952, We have held in the case of Tan vs. Standard Vacuum Oil Company 91 Phil.
672, that "the acquittal of the accused from the criminal charge will not necessarily extinguish the
civil liability unless the court declares in the judgment that the fact from which the civil liability
might arise did not exist. Where the court states 'that the evidence throws no light on the cause
of fire and that it was an unfortunate accident for which the accused cannot be held responsible,'
this declaration fits well into the exception of the rule which exempts the accused, from civil
liability. " Likewise, in Albornoz vs. Albornoz, 98 Phil. 785, it was the ruling that "where the
judgment in a criminal action contains an express declaration that the basis of claimant's action
did not exist, the latter's action for civil liability is barred under section 1 (d) Rule 107 of the Rules
of Court." And, in De Mesa vs. Priela 24 SCRA 582, this Court, speaking through then Chief
Justice Roberto Concepcion, ruled that extinction of the penal action does not carry with it
extinction of the civil, unless the extinction proceeds from a declaration in a final judgment that
the fact from which the civil might arise did not exist. In other cases, the person entitled to the
civil action may institute it in the jurisdiction and in the manner provided by law against the
person who may be liable for restitution of the thing and reparation or indemnity for the damage
suffered (Sec. 3 [c], Rule 111, Rules of Court.)"

As held in Corpus vs. Paje, supra, reckless imprudence or criminal negligence is not one of the
three crimes mentioned in Article 33 of the Civil Code, which provides:

ART. 33. In cases of defamation, fraud, and physical injuries, a civil action for
damages, entirely separate and distinct from the criminal action may be brought
by the injured party. Such civil action shall proceed independently of the criminal
prosecution, and shall require only a preponderance of evidence.

The above article speaks only of defamation, fraud and physical injuries. The injuries suffered by
herein petitioners were alleged to be the result of criminal negligence; they were not inflicted with
malice. Hence, no independent civil action for damages may be instituted in connection
therewith. Further, Section 3 (c), Rule 111 of the Rules of Court states that "(c) Extinction of the
penal action does not carry with it extinction of the civil, unless the extinction proceeds from a
declaration in a final judgment that the fact from which the civil might arise did not exist."
Otherwise stated, unless the act from which the civil liability arises is declared to be nonexistent
in the final judgment, the extinction of the criminal liability will not carry with it the extinction of the
civil liability. Thus, if a person is charged with homicide and successfully pleaded self-defense,
his acquittal by reason thereof will extinguish his civil liability. He has not incurred any criminal
liability. On the other hand, if his acquittal is, for instance, due to the fact that he was not
sufficiently Identified to be the assailant, a civil action for damages may be maintained. His
acquittal is not due to non-existence of the crime from which civil liability might arise, but because
he was not, in the eyes of the court, sufficiently Identified as the perpetrator of the crime.

In People vs. Buan, 22 SCRA 1383, this Court, speaking through Mr. Justice J.B.L. Reyes, said
that "the essence of the quasi offense of criminal negligence under Article 365 of the Revised
Penal Code lies in the execution of an imprudent or negligent act that, if intentionally done, would
be punishable as a felony. The law penalizes the negligent or careless act, not the result thereof.
The gravity of the consequence is only taken into account to determine the penalty; it does not
qualify the substance of the offense.

The charge against Felardo Paje was not for homicide and physical injuries but for reckless
imprudence or criminal negligence resulting in homicide (death of Clemente Marcia) and physical
injuries suffered by Edgar Marcia and Renato Yap. They are not one of the three (3) crimes
mentioned in Article 33 of the Civil Code and, therefore, no civil action shall proceed
independently of the criminal prosecution.

The case of Laura Corpus vs. Felardo Paje (supra) is the same as the case at bar, the only
difference being the party-plaintiffs or petitioners. Clemente Marcia died, while Edgar Marcia and
Renato Yap suffered physical injuries in the same accident. The heirs of Clemente Marcia filed
Civil Case No. 6880 in the Court of First Instance of Rizal against herein respondents. The case
was dismissed and appealed directly to this Court. The order appealed from was affirmed, as
1äwphï1.ñët 

recorded in Laura Corpus vs. Felardo Paje, 28 SCRA 1062.

The case at bar (Civil Case No. 4425) was filed by Edgar Marcia and Renato Yap against the
same defendants in the Court of First Instance of Rizal. After trial, the case was dismissed and
affirmed by the Court of Appeals. It is now before Us on appeal by certiorari from the said
decision.
Relative to the admissibility of the documents, to wit; (a) the records of the criminal case against
Paje, (b) the decision of the Court of Appeals acquitting the latter; and (c) copy of the brief of the
respondent Paje as accused-appellant, suffice it to say that since petitioners' cause of action is
based on the alleged recklessness and imprudence of respondent Paje it necessarily follows that
his acquittal by the Court of Appeals and its declaration that the mishap was "pure accident" are
relevant and material evidence. In fact, the lower court may even take judicial notice of the
decision of the Court of Appeals in said criminal case.

Finally, with respect to the findings of fact of the Court of Appeals, well settled is the rule that the
same are final and cannot be disturbed by Us, particularly where they are based, as they are in
the case at bar, upon substantial evidence.

WHEREFORE, the decision appealed from is hereby AFFIRMED in toto. With costs against the
petitioners.

SO ORDERED.