[G.R. NO.
184905 : August 28, 2009] Weighing the respective evidence of the parties, the MeTC rendered the Decision dated 1
LAMBERT S. RAMOS, Petitioner, v. C.O.L. REALTY CORPORATION, Respondent.
DECISION
YNARES-SANTIAGO, J.:
The issue for resolution is whether petitioner can be held solidarily liable with his driver,
Rodel Ilustrisimo, to pay respondent C.O.L. Realty the amount of P51,994.80 as actual
damages suffered in a vehicular collision.
The facts, as found by the appellate court, are as follows:
On or about 10:40 o'clock in the morning of 8 March 2004, along Katipunan (Avenue),
corner Rajah Matanda (Street), Quezon City, a vehicular accident took place between a
Toyota Altis Sedan bearing Plate Number XDN 210, owned by petitioner C.O.L. Realty
Corporation, and driven by Aquilino Larin ("Aquilino"), and a Ford Expedition, owned by x
x x Lambert Ramos (Ramos) and driven by Rodel Ilustrisimo ("Rodel"), with Plate Number
LSR 917. A passenger of the sedan, one Estela Maliwat ("Estela") sustained injuries. She
was immediately rushed to the hospital for treatment.
(C.O.L. Realty) averred that its driver, Aquilino, was slowly driving the Toyota Altis car at a
speed of five to ten kilometers per hour along Rajah Matanda Street and has just crossed
the center lane of Katipunan Avenue when (Ramos') Ford Espedition violently rammed
against the car's right rear door and fender. With the force of the impact, the sedan turned
180 degrees towards the direction where it came from.
Upon investigation, the Office of the City Prosecutor of Quezon City found probable cause
to indict Rodel, the driver of the Ford Expedition, for Reckless Imprudence Resulting in
Damage to Property. In the meantime, petitioner demanded from respondent
reimbursement for the expenses incurred in the repair of its car and the hospitalization of
Estela in the aggregate amount of P103,989.60. The demand fell on deaf ears prompting
(C.O.L. Realty) to file a Complaint for Damages based on quasi-delict before the
Metropolitan Trial Court of Metro Manila (MeTC), Quezon City, docketed as Civil Case No.
33277, and subsequently raffled to Branch 42.
As could well be expected, (Ramos) denied liability for damages insisting that it was the
negligence of Aquilino, (C.O.L. Realty's) driver, which was the proximate cause of the
accident. (Ramos) maintained that the sedan car crossed Katipunan Avenue from Rajah
Matanda Street despite the concrete barriers placed thereon prohibiting vehicles to pass
through the intersection.
(Ramos) further claimed that he was not in the vehicle when the mishap occurred. He
asserted that he exercised the diligence of a good father of a family in the selection and
supervision of his driver, Rodel.
March 2006 exculpating (Ramos) from liability, thus:
"WHEREFORE, the instant case is DISMISSED for lack of merit. The Counterclaims of the
defendant are likewise DISMISSED for lack of sufficient factual and legal basis.
SO ORDERED."
The aforesaid judgment did not sit well with (C.O.L. Realty) so that he (sic) appealed the
same before the RTC of Quezon City, raffled to Branch 215, which rendered the assailed
Decision dated 5 September 2006, affirming the MeTC's Decision. (C.O.L. Realty's) Motion
for Reconsideration met the same fate as it was denied by the RTC in its Order dated 5
June 2007.
C.O.L. Realty appealed to the Court of Appeals which affirmed the view that Aquilino was
negligent in crossing Katipunan Avenue from Rajah Matanda Street since, as per
Certification of the Metropolitan Manila Development Authority (MMDA) dated November
30, 2004, such act is specifically prohibited. Thus:
This is to certify that as per records found and available in this office the crossing of
vehicles at Katipunan Avenue from Rajah Matanda Street to Blue Ridge Subdivision,
Quezon City has (sic) not allowed since January 2004 up to the present in view of the
ongoing road construction at the area. (Emphasis supplied)
Barricades were precisely placed along the intersection of Katipunan Avenue and Rajah
Matanda Street in order to prevent motorists from crossing Katipunan Avenue.
Nonetheless, Aquilino crossed Katipunan Avenue through certain portions of the barricade
which were broken, thus violating the MMDA rule.
However, the Court of Appeals likewise noted that at the time of the collision, Ramos'
vehicle was moving at high speed in a busy area that was then the subject of an ongoing
construction (the Katipunan Avenue-Boni Serrano Avenue underpass), then smashed into
the rear door and fender of the passenger's side of Aquilino's car, sending it spinning in a
180-degree turn. It therefore found the driver Rodel guilty of contributory negligence for
driving the Ford Expedition at high speed along a busy intersection.
Thus, on May 28, 2008, the appellate court rendered the assailed Decision, the dispositive
portion of which reads, as follows:
WHEREFORE, the Decision dated 5 September 2006 of the Regional Trial Court of Quezon
City, Branch 215 is hereby MODIFIED in that respondent Lambert Ramos is held solidarily
liable with Rodel Ilustrisimo to pay petitioner C.O.L. Realty Corporation the amount of
P51,994.80 as actual damages. Petitioner C.O.L. Realty Corporation's claim for exemplary
damages, attorney's fees and cost of suit are DISMISSED for lack of merit.
SO ORDERED.
Petitioner filed a Motion for Reconsideration but it was denied. Hence, the instant petition,
which raises the following sole issue:
THE COURT OF APPEALS' DECISION IS CONTRARY TO LAW AND JURISPRUDENCE, AND
THE EVIDENCE TO SUPPORT AND JUSTIFY THE SAME IS INSUFFICIENT.
We resolve to GRANT the petition.
There is no doubt in the appellate court's mind that Aquilino's violation of the MMDA
prohibition against crossing Katipunan Avenue from Rajah Matanda Street was the
proximate cause of the accident. Respondent does not dispute this; in its Comment to the
instant petition, it even conceded that petitioner was guilty of mere contributory
negligence.
Thus, the Court of Appeals acknowledged that:
The Certification dated 30 November 2004 of the Metropolitan Manila Development
Authority (MMDA) evidently disproved (C.O.L. Realty's) barefaced assertion that its driver,
Aquilino, was not to be blamed for the accident '
"TO WHOM IT MAY CONCERN:
This is to certify that as per records found and available in this office the crossing of
vehicles at Katipunan Avenue from Rajah Matanda Street to Blue Ridge Subdivision,
Quezon City has (sic) not allowed since January 2004 up to the present in view of the
ongoing road construction at the area.
This certification is issued upon request of the interested parties for whatever legal
purpose it may serve."
(C.O.L. Realty) admitted that there were barricades along the intersection of Katipunan
Avenue and Rajah Matanda Street. The barricades were placed thereon to caution drivers
not to pass through the intersecting roads. This prohibition stands even if, as (C.O.L.
Realty) claimed, the "barriers were broken" at that point creating a small gap through
which any vehicle could pass. What is clear to Us is that Aquilino recklessly ignored these
barricades and drove through it. Without doubt, his negligence is established by the fact
that he violated a traffic regulation. This finds support in Article 2185 of the Civil Code'
"Unless there is proof to the contrary, it is presumed that a person driving a motor vehicle
has been negligent if at the time of the mishap, he was violating any traffic regulation."
Accordingly, there ought to be no question on (C.O.L. Realty's) negligence which resulted
in the vehicular mishap.
However, it also declared Ramos liable vicariously for Rodel's contributory negligence in
driving the Ford Expedition at high speed along a busy intersection. On this score, the
appellate court made the following pronouncement:
As a professional driver, Rodel should have known that driving his vehicle at a high speed
in a major thoroughfare which was then subject of an on-going construction was a perilous
act. He had no regard to (sic) the safety of other vehicles on the road. Because of the
impact of the collision, (Aquilino's) sedan made a 180-degree turn as (Ramos') Ford
Expedition careened and smashed into its rear door and fender. We cannot exculpate
Rodel from liability.
Having thus settled the contributory negligence of Rodel, this created a presumption of
negligence on the part of his employer, (Ramos). For the employer to avoid the solidary
liability for a tort committed by his employee, an employer must rebut the presumption by
presenting adequate and convincing proof that in the selection and supervision of his
employee, he or she exercises the care and diligence of a good father of a family.
Employers must submit concrete proof, including documentary evidence, that they
complied with everything that was incumbent on them.
(Ramos) feebly attempts to escape vicarious liability by averring that Rodel was highly
recommended when he applied for the position of family driver by the Social Service
Committee of his parish. A certain Ramon Gomez, a member of the church's livelihood
program, testified that a background investigation would have to be made before an
applicant is recommended to the parishioners for employment. (Ramos) supposedly tested
Rodel's driving skills before accepting him for the job. Rodel has been his driver since
2001, and except for the mishap in 2004, he has not been involved in any road accident.
Regrettably, (Ramos') evidence which consisted mainly of testimonial evidence remained
unsubstantiated and are thus, barren of significant weight. There is nothing on the records
which would support (Ramos') bare allegation of Rodel's 10-year unblemished driving
record. He failed to present convincing proof that he went to the extent of verifying
Rodel's qualifications, safety record, and driving history.
So too, (Ramos) did not bother to refute (C.O.L. Realty's) stance that his driver was
texting with his cellphone while running at a high speed and that the latter did not slow
down albeit he knew that Katipunan Avenue was then undergoing repairs and that the
road was barricaded with barriers. The presumption juris tantum that there was
negligence in the selection of driver remains unrebutted. As the employer of Rodel,
(Ramos) is solidarily liable for the quasi-delict committed by the former.
Certainly, in the selection of prospective employees, employers are required to examine
them as to their qualifications, experience and service records. In the supervision of
employees, the employer must formulate standard operating procedures, monitor their
implementation and impose disciplinary measures for the breach thereof. These, (Ramos)
failed to do.
Petitioner disagrees, arguing that since Aquilino's willful disregard of the MMDA prohibition
was the sole proximate cause of the accident, then respondent alone should suffer the
consequences of the accident and the damages it incurred. He argues:
20. It becomes apparent therefore that the only time a plaintiff, the respondent herein,
can recover damages is if its negligence was only contributory, and such contributory
negligence was the proximate cause of the accident. It has been clearly established in this
case, however, that respondent's negligence was not merely contributory, but the sole
proximate cause of the accident.
x   x   x
22. As culled from the foregoing, respondent was the sole proximate cause of the
accident. Respondent's vehicle should not have been in that position since crossing the
said intersection was prohibited. Were it not for the obvious negligence of respondent's
driver in crossing the intersection that was prohibited, the accident would not have
happened. The crossing of respondent's vehicle in a prohibited intersection unquestionably
produced the injury, and without which the accident would not have occurred. On the
other hand, petitioner's driver had the right to be where he was at the time of the mishap.
As correctly concluded by the RTC, the petitioner's driver could not be expected to slacken
his speed while travelling along said intersection since nobody, in his right mind, would do
the same. Assuming, however, that petitioner's driver was indeed guilty of any
contributory negligence, such was not the proximate cause of the accident considering
that again, if respondent's driver did not cross the prohibited intersection, no accident
would have happened. No imputation of any lack of care on Ilustrisimo's could thus be
concluded. It is obvious then that petitioner's driver was not guilty of any negligence that
would make petitioner vicariously liable for damages.
23. As the sole proximate cause of the accident was respondent's own driver, respondent
cannot claim damages from petitioner.
On the other hand, respondent in its Comment merely reiterated the appellate court's
findings and pronouncements, conceding that petitioner is guilty of mere contributory
negligence, and insisted on his vicarious liability as Rodel's employer under Article 2184 of
the Civil Code.
Articles 2179 and 2185 of the Civil Code on quasi-delicts apply in this case, viz:
Article 2179. When the plaintiff's own negligence was the immediate and proximate cause
of his injury, he cannot recover damages. But if his negligence was only contributory, the
immediate and proximate cause of the injury being the defendant's lack of due care, the
plaintiff may recover damages, but the courts shall mitigate the damages to be awarded.
Article 2185. Unless there is proof to the contrary, it is presumed that a person driving a
motor vehicle has been negligent if at the time of the mishap, he was violating any traffic
regulation.
If the master is injured by the negligence of a third person and by the concurring
contributory negligence of his own servant or agent, the latter's negligence is imputed to
his superior and will defeat the superior's action against the third person, assuming of
course that the contributory negligence was the proximate cause of the injury of which
complaint is made.
Applying the foregoing principles of law to the instant case, Aquilino's act of crossing
Katipunan Avenue via Rajah Matanda constitutes negligence because it was prohibited by
law. Moreover, it was the proximate cause of the accident, and thus precludes any
recovery for any damages suffered by respondent from the accident.
Proximate cause is defined as that cause, which, in natural and continuous sequence,
unbroken by any efficient intervening cause, produces the injury, and without which the
result would not have occurred. And more comprehensively, the proximate legal cause is
that acting first and producing the injury, either immediately or by setting other events in
motion, all constituting a natural and continuous chain of events, each having a close
causal connection with its immediate predecessor, the final event in the chain immediately
effecting the injury as a natural and probable result of the cause which first acted, under
such circumstances that the person responsible for the first event should, as an ordinary
prudent and intelligent person, have reasonable ground to expect at the moment of his act
or default that an injury to some person might probably result therefrom.
If Aquilino heeded the MMDA prohibition against crossing Katipunan Avenue from Rajah
Matanda, the accident would not have happened. This specific untoward event is exactly
what the MMDA prohibition was intended for. Thus, a prudent and intelligent person who
resides within the vicinity where the accident occurred, Aquilino had reasonable ground to
expect that the accident would be a natural and probable result if he crossed Katipunan
Avenue since such crossing is considered dangerous on account of the busy nature of the
thoroughfare and the ongoing construction of the Katipunan-Boni Avenue underpass. It
was manifest error for the Court of Appeals to have overlooked the principle embodied in
Article 2179 of the Civil Code, that when the plaintiff's own negligence was the immediate
and proximate cause of his injury, he cannot recover damages.
Hence, we find it unnecessary to delve into the issue of Rodel's contributory negligence,
since it cannot overcome or defeat Aquilino's recklessness which is the immediate and
proximate cause of the accident. Rodel's contributory negligence has relevance only in the
event that Ramos seeks to recover from respondent whatever damages or injuries he may
have suffered as a result; it will have the effect of mitigating the award of damages in his
favor. In other words, an assertion of contributory negligence in this case would benefit
only the petitioner; it could not eliminate respondent's liability for Aquilino's negligence
which is the proximate result of the accident.
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals dated May 28,
2008 in CA-G.R. SP No. 99614 and its Resolution of October 13, 2008 are hereby
REVERSED and SET ASIDE. The Decision of the Regional Trial Court of Quezon City,
Branch 215 dated September 5, 2006 dismissing for lack of merit respondent's complaint
for damages is hereby REINSTATED.
SO ORDERED.
G.R. No. L-16629             January 31, 1962
SOUTHERN LINES, INC., petitioner,
vs.
COURT OF APPEALS and CITY OF ILOILO, respondents.
Jose Ma. Lopez Vito, Jr. for petitioner.
The City Fiscal for respondents.
DE LEON, J.:
This is a petition to review on certiorari the decision of the Court of Appeals in CA-G.R. No.
15579-R affirming that of the Court of First Instance of Iloilo which sentenced petitioner
Southern Lines, Inc. to pay respondent City of Iloilo the amount of P4,931.41.
Sometime in 1948, the City of Iloilo requisitioned for rice from the National Rice and Corn
Corporation (hereafter referred to as NARIC) in Manila. On August 24 of the same year,
NARIC, pursuant to the order, shipped 1,726 sacks of rice consigned to the City of Iloilo on
board the SS "General Wright" belonging to the Southern Lines, Inc. Each sack of rice
weighed 75 kilos and the entire shipment as indicated in the bill of lading had a total
weight of 129,450 kilos. According to the bill of lading, the cost of the shipment was
P63,115.50 itemized and computed as follows: .
Unit Price per bag P36.25 P62,567.50
Handling at P0.13 per bag 224.38
Trucking at P2.50 per bag 323.62
T o t a l . . . . . .. . . . . 63,115.50
On September 3, 1948, the City of Iloilo received the shipment and paid the amount of
P63,115.50. However, it was noted that the foot of the bill of lading that the City of Iloilo
'Received the above mentioned merchandise apparently in same condition as when
shipped, save as noted below: actually received 1685 sacks with a gross weight of
116,131 kilos upon actual weighing. Total shortage ascertained 13,319 kilos." The
shortage was equivalent to 41 sacks of rice with a net weight of 13,319 kilos, the
proportionate value of which was P6,486.35.
On February 14, 1951 the City of Iloilo filed a complaint in the Court of First Instance of
Iloilo against NARIC and the Southern Lines, Inc. for the recovery of the amount of
P6,486.35 representing the value of the shortage of the shipment of rice. After trial, the
lower court absolved NARIC from the complaint, but sentenced the Southern Lines, Inc. to
pay the amount of P4,931.41 which is the difference between the sum of P6,486.35 and
P1,554.94 representing the latter's counterclaim for handling and freight.
The Southern Lines, Inc. appealed to the Court of Appeals which affirmed the judgment of
the trial court. Hence, this petition for review.
The only question to be determined in this petition is whether or not the defendant-carrier,
the herein petitioner, is liable for the loss or shortage of the rice shipped.
Article 361 of the Code of Commerce provides: .
ART. 361. — The merchandise shall be transported at the risk and venture of the
shipper, if the contrary has not been expressly stipulated.
As a consequence, all the losses and deteriorations which the goods may suffer during
the transportation by reason of fortuitous event, force majeure, or the inherent nature
and defect of the goods, shall be for the account and risk of the shipper.
Proof of these accidents is incumbent upon the carrier.
Article 362 of the same Code provides: .
ART. 362. — Nevertheless, the carrier shall be liable for the losses and damages
resulting from the causes mentioned in the preceding article if it is proved, as against
him, that they arose through his negligence or by reason of his having failed to take
the precautions which usage his established among careful persons, unless the shipper
has committed fraud in the bill of lading, representing the goods to be of a kind or
quality different from what they really were.
If, notwithstanding the precautions referred to in this article, the goods transported run
the risk of being lost, on account of their nature or by reason of unavoidable accident,
there being no time for their owners to dispose of them, the carrier may proceed to sell
them, placing them for this purpose at the disposal of the judicial authority or of the
officials designated by special provisions.
Under the provisions of Article 361, the defendant-carrier in order to free itself from
liability, was only obliged to prove that the damages suffered by the goods were "by virtue
of the nature or defect of the articles." Under the provisions of Article 362, the plaintiff, in
order to hold the defendant liable, was obliged to prove that the damages to the goods by
virtue of their nature, occurred on account of its negligence or because the defendant did
not take the precaution adopted by careful persons. (Government v. Ynchausti & Co., 40
Phil. 219, 223).
Petitioner claims exemption from liability by contending that the shortage in the shipment
of rice was due to such factors as the shrinkage, leakage or spillage of the rice on account
of the bad condition of the sacks at the time it received the same and the negligence of
the agents of respondent City of Iloilo in receiving the shipment. The contention is
untenable, for, if the fact of improper packing is known to the carrier or his servants, or
apparent upon ordinary observation, but it accepts the goods notwithstanding such
condition, it is not relieved of liability for loss or injury resulting thereform. (9 Am Jur.
869.) Furthermore, according to the Court of Appeals, "appellant (petitioner) itself frankly
admitted that the strings that tied the bags of rice were broken; some bags were with
holes and plenty of rice were spilled inside the hull of the boat, and that the personnel of
the boat collected no less than 26 sacks of rice which they had distributed among
themselves." This finding, which is binding upon this Court, shows that the shortage
resulted from the negligence of petitioner.
Invoking the provisions of Article 366 of the Code of Commerce and those of the bill of
lading, petitioner further contends that respondent is precluded from filing an action for
damages on account of its failure to present a claim within 24 hours from receipt of the
shipment. It also cites the cases of Government v. Ynchausti & Co., 24 Phil. 315
and Triton Insurance Co. v. Jose, 33 Phil. 194, ruling to the effect that the requirement
that the claim for damages must be made within 24 hours from delivery is a condition
precedent to the accrual of the right of action to recover damages. These two cases
above-cited are not applicable to the case at bar. In the first cited case, the plaintiff never
presented any claim at all before filing the action. In the second case, there was payment
of the transportation charges which precludes the presentation of any claim against the
carrier. (See Article 366, Code of Commerce.) It is significant to note that in the American
case of Hoye v. Pennsylvania Railroad Co., 13 Ann. Case. 414, it has been said: .
... "It has been held that a stipulation in the contract of shipment requiring the owner of
the goods to present a notice of his claim to the carrier within a specified time after the
goods have arrived at their destination is in the nature of a condition precedent to the
owner's right to enforce a recovery, that he must show in the first instance that he has
complied with the condition, or that the circumstances were such that to have complied
with it would have required him to do an unreasonable thing. The weight of authority,
however, sustains the view that such a stipulation is more in the nature of a limitation
upon the owner's right to recovery, and that the burden of proof is accordingly on the
carrier to show that the limitation was reasonable and in proper form or within the time
stated." (Hutchinson on Carrier, 3d ed., par. 44) Emphasis supplied.
In the case at bar, the record shows that petitioner failed to plead this defense in its
answer to respondent's complaint and, therefore, the same is deemed waived (Section 10,
Rule 9, Rules of Court), and cannot be raised for the first time at the trial or on appeal.
(Maxilom v. Tabotabo, 9 Phil. 390.) Moreover, as the Court of Appeals has said: .
... the records reveal that the appellee (respondent) filed the present action, within a
reasonable time after the short delivery in the shipment of the rice was made. It should
be recalled that the present action is one for the refund of the amount paid in excess,
and not for damages or the recovery of the shortage; for admittedly the appellee
(respondent) had paid the entire value of the 1726 sacks of rice, subject to subsequent
adjustment, as to shortages or losses. The bill of lading does not at all limit the time for
filing an action for the refund of money paid in excess.
WHEREFORE, the decision of the Court of Appeals is hereby affirmed in all respects and
the petition for certiorari denied.
With costs against the petitioner.
[G.R. No. L-48757. May 30, 1988.]
MAURO GANZON, Petitioner, v. COURT OF APPEALS and GELACIO E.
TUMAMBING, Respondents.
Antonio B. Abinoja for Petitioner.
Quijano, Arroyo & Padilla Law Office for Respondents.
DECISION
SARMIENTO, J.:
The private respondent instituted in the Court of First Instance of Manila an action against
the petitioner for damages based on culpa contractual. The antecedent facts, as found by
respondent Court, are undisputed:
On November 28, 1956, Gelacio Tumambing contracted the services of Mauro B. Ganzon
to haul 305 tons of scrap iron from Mariveles, Bataan, to the port of Manila on board the
lighter LCT "Batman" (Exhibit 1, Stipulation of Facts, Amended Record on Appeal, p. 38).
Pursuant to this agreement, Mauro B. Ganzon sent his lighter "Batman" to Mariveles where
it docked in three feet of water (t.s.n., September 28, 1972, p. 31). On December 1,
1956, Gelacio Tumambing delivered the scrap iron to defendant Filomeno Niza, captain of
the lighter, for loading which was actually begun on the same date by the crew of the
lighter under the captain’s supervision. When about half of the scrap iron was already
loaded (t.s.n., December 14, 1972, p. 20), Mayor Jose Advincula of Mariveles, Bataan,
arrived and demanded P5,000.00 from Gelacio Tumambing. The latter resisted the
shakedown and after a heated argument between them, Mayor Jose Advincula drew his
gun and fired at Gelacio Tumambing (t.s.n., March 19, 1971, p. 9; September 28, 1972,
pp. 6-7). The gunshot was not fatal but Tumambing had to be taken to a hospital in
Balanga, Bataan, for treatment (t.s.n., March 19, 1971, p. 13; September 28, 1972, p.
15).
After sometime, the loading of the scrap iron was resumed. But on December 4, 1956,
Acting Mayor Basilio Rub, accompanied by three policemen, ordered captain Filomeno Niza
and his crew to dump the scrap iron (t.s.n., June 16, 1972, pp. 8-9) where the lighter was
docked (t.s.n., September 28, 1972, p. 31). The rest was brought to the compound of
NASSCO (Record on Appeal, pp. 20-22). Later on Acting Mayor Rub issued a receipt
stating that the Municipality of Mariveles had taken custody of the scrap iron (Stipulation
of Facts, Record on Appeal, p. 40; t.s.n., September 28, 1972, p. 10.)
On the basis of the above findings, the respondent Court rendered a decision, the
dispositive portion of which states:
WHEREFORE, the decision appealed from is hereby reversed and set aside and a new one
entered ordering defendant appellee Mauro Ganzon to pay plaintiff-appellant Gelacio E.
Tumambing the sum of P5,895.00 as actual damages, the sum of P5,000.00 as exemplary
damages, and the amount of P2,000.00 as attorney’s fees. Costs against defendant-
appellee Ganzon.
In this petition for review on certiorari, the alleged errors in the decision of the Court of
Appeals are:
I Hence, the petitioner is presumed to have been at fault or to have acted negligently. By
THE COURT OF APPEALS FINDING THE HEREIN PETITIONER GUILTY OF BREACH OF THE
CONTRACT OF TRANSPORTATION AND IN IMPOSING A LIABILITY AGAINST HIM
COMMENCING FROM THE TIME THE SCRAP WAS PLACED IN HIS CUSTODY AND CONTROL
HAVE NO BASIS IN FACT AND IN LAW.
II
THE APPELLATE COURT ERRED IN CONDEMNING THE PETITIONER FOR THE ACTS OF HIS
EMPLOYEES IN DUMPING THE SCRAP INTO THE SEA DESPITE THAT IT WAS ORDERED BY
THE LOCAL GOVERNMENT OFFICIAL WITHOUT HIS PARTICIPATION.
III
THE APPELLATE COURT FAILED TO CONSIDER THAT THE LOSS OF THE SCRAP WAS DUE
TO A FORTUITOUS EVENT AND THE PETITIONER IS THEREFORE NOT LIABLE FOR ANY
LOSSES AS A CONSEQUENCE THEREOF.
The petitioner, in his first assignment of error, insists that the scrap iron had not been
unconditionally placed under his custody and control to make him liable. However, he
completely agrees with the respondent Court’s finding that on December 1, 1956, the
private respondent delivered the scraps to Captain Filomeno Niza for loading in the lighter
"Batman." That the petitioner, thru his employees, actually received the scraps is freely
admitted. Significantly, there is not the slightest allegation or showing of any condition,
qualification, or restriction accompanying the delivery by the private respondent-shipper of
the scraps, or the receipt of the same by the petitioner. On the contrary, soon after the
scraps were delivered to, and received by the petitioner-common carrier, loading was
commenced.
By the said act of delivery, the scraps were unconditionally placed in the possession and
control of the common carrier, and upon their receipt by the carrier for transportation, the
contract of carriage was deemed perfected. Consequently, the petitioner-carrier’s
extraordinary responsibility for the loss, destruction, or determination of the goods
commenced. Pursuant to Art. 1736, such extraordinary responsibility would cease only
upon the delivery, actual or constructive, by the carrier to the consignee, or to the person
who has a right to receive them. The fact that part of the shipment had not been loaded
on board the lighter did not impair the said contract of transportation as the goods
remained in the custody and control of the carrier, albeit still unloaded.
The petitioner has failed to show that the loss of the scraps was due to any of the
following causes enumerated in Article 1734 of the Civil Code, namely:
(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;
(2) Act of the public enemy in war, whether international or civil;
(3) Act or omission of the shipper or owner of the goods;
(4) The character of the goods or defects in the packing or in the containers;
(5) Order or act of competent public authority.
reason of this presumption, the court is not even required to make an express finding of
fault or negligence before it could hold the petitioner answerable for the breach of the
contract of carriage. Still, the petitioner could have been exempted from any liability had
he been able to prove that he observed extraordinary diligence in the vigilance over the
goods in his custody, according to all the circumstances of the case, or that the loss was
due to an unforeseen event or to force majeure. As it was, there was hardly any attempt
on the part of the petitioner to prove that he exercised such extraordinary diligence.
It is in the second and third assignments of error where the petitioner maintains that he is
exempt from any liability because the loss of the scraps was due mainly to the
intervention of the municipal officials of Mariveles which constitutes a caso fortuito as
defined in Article 1174 of the Civil Code.
We cannot sustain the theory of caso fortuito. In the courts below, the petitioner’s defense
was that the loss of the scraps was due to an "order or act of competent public authority,"
and this contention was correctly passed upon by the Court of Appeals which ruled that:
. . . In the second place, before the appellee Ganzon could be absolved from responsibility
on the ground that he was ordered by competent public authority to unload the scrap iron,
it must be shown that Acting Mayor Basilio Rub had the power to issue the disputed order,
or that it was lawful, or that it was issued under legal process of authority. The appellee
failed to establish this. Indeed, no authority or power of the acting mayor to issue such an
order was given in evidence. Neither has it been shown that the cargo of scrap iron
belonged to the Municipality of Mariveles. What we have in the record is the stipulation of
the parties that the cargo of scrap iron was accumulated by the appellant through
separate purchases here and there from private individuals (Record on Appeal, pp. 38-39).
The fact remains that the order given by the acting mayor to dump the scrap iron into the
sea was part of the pressure applied by Mayor Jose Advincula to shakedown the appellant
for P5,000.00. The order of the acting mayor did not constitute valid authority for appellee
Mauro Ganzon and his representatives to carry out.
Now the petitioner is changing his theory to caso fortuito. Such a change of theory on
appeal we cannot, however, allow. In any case, the intervention of the municipal officials
was not of a character that would render impossible the fulfillment by the carrier of its
obligation. The petitioner was not duty bound to obey the illegal order to dump into the
sea the scrap iron. Moreover, there is absence of sufficient proof that the issuance of the
same order was attended with such force or intimidation as to completely overpower the
will of the petitioner’s employees. The mere difficulty in the fulfillment of the obligation is
not considered force majeure. We agree with the private respondent that the scraps could
have been properly unloaded at the shore or at the NASSCO compound, so that after the
dispute with the local officials concerned was settled, the scraps could then be delivered in
accordance with the contract of carriage.
There is no incompatibility between the Civil Code provisions on common carriers and
Articles 361 and 362 of the Code of Commerce which were the basis for this Court’s ruling
in Government of the Philippine Islands v. Ynchausti & Co. and which the petitioner
invokes in this petition. For Art. 1735 of the Civil Code, conversely stated, means that the
shipper will suffer the losses and deterioration arising from the causes enumerated in Art.
1734; and in these instances, the burden of proving that damages were caused by the
fault or negligence of the carrier rests upon him. However, the carrier must first establish
that the loss or deterioration was occasioned by one of the excepted causes or was due to
an unforeseen event or to force majeure. Be that as it may, insofar as Art. 362 appears to
require of the carrier only ordinary diligence, the same is deemed to have been modified
by Art. 1733 of the Civil Code.
Finding the award of actual and exemplary damages to be proper, the same will not be
disturbed by us. Besides, these were not sufficiently controverted by the petitioner.
WHEREFORE, the petition is DENIED; the assailed decision of the Court of Appeals is
hereby AFFIRMED. Costs against the petitioner.
[G.R. No. L-22272. June 26, 1967.]
ANTONIA MARANAN, Plaintiff-Appellant, v. PASCUAL PEREZ, ET AL., Defendants,
PASCUAL PEREZ, Defendant-Appellant.
Pedro Panganiban, for Plaintiff-Appellant.
Magno T . Bueser, for Defendant-Appellant.
SYLLABUS
1. CIVIL LAW; COMMON CARRIERS; CASE AT BAR. — R.C. was a passenger in a taxicab
owned by P. P. when he was stabbed to death by the driver, S.V. In the subsequent action
for damages, P. P. cited Gillaco v. MRR, 97 Phil., 884, which ruled that the carrier is under
no absolute liability for assaults of its employees upon the passengers. Held, the Gillaco
case does not apply. There, the passenger was killed outside the scope and course of duty
of the guilty employee while here, the killing took place in the course of duty of the guilty
employee and when he was acting within the scope of his duties.
2. ID.; ID.; OLD AND NEW CIVIL CODES COMPARED. — Unlike the old Civil Code, the new
Civil Code of the Philippines in its Article 1759 expressly makes the common carrier liable
for intentional assaults committed by its employees upon its passengers.
3. ID.; ID.; BASIS OF CARRIER’S LIABILITY FOR ASSAULTS ON PASSENGERS COMMITTED
BY ITS DRIVERS. — The Civil Code provisions on the subject of Common Carriers (Sec. 4,
Chap. 3, Title VIII, Rep. Act No. 386) are new and were taken from Anglo-American Law
(Report of the Code Commission, 64). There, the basis of the carrier’s liability for assaults
on passengers committed by its drivers rest either on (1) the doctrine of respondent
superior, or (2) the principle that it is the carrier’s implied duty to transport the passenger
safely (53 ALR 2d 721-728; 732-734). Under the first, which is the minority view, the
carrier is liable only when the act of the employee is within the scope of his authority and
duty. It is not sufficient that the act be within the course of employment only. Under the
second view, upheld by the majority and also by the later cases, it is enough that the
assault happens within the course of the employee’s duty. It is no defense for the carrier
that the act was done in excess of authority or in disobedience of the carrier’s orders (10
Am. Jur. 105-107; 263-265). The carrier’s liability her is absolute in the sense that it
practically secures the passengers from assaults committed by its own employees (Dixie
Motor Coach Corp. v. Toler, 1997 Ark. 1097, 126 S.W., 2d, 618; Van Hoeffen v. Columbia
Taxicab Co., 179 Mo. App. 591, 162 S.W. 694; Brockway v. Mordenti, 199 Misc. 898, 103
N.Y.S. 621; Korner v. Cosgrove, 141 N.E. 265, 31 A.L.R. 1193).
4. ID.; ID.; ID.; NEW CIVIL CODE FOLLOWS SECOND VIEW. — As can be gleaned from
the Article 1759, the Civil Code of the Philippines evidently follows the rule based on the
second view: (1) the special undertaking of the carrier requires that it furnish its
passengers that full measure of protection afforded by the exercise of the high degree of
care prescribed by the law, inter alia from violence and insults at the hands of strangers
and other passengers, but above all, from the acts of the carrier’s own servants charged
with the passenger’s safety; (2) said liability of the carrier from the servant’s violations of
duty to passengers, is the result of the former’s confiding in the servant’s hands the
performance of his contract to safely transport the passenger, with the utmost care
prescribed by law; and (3) as between the carrier and the passenger, the former must
bear the risk of wrongful acts or negligence of the carrier’s employees against passengers,
since it, and not the passengers, has power to select and remove them. (Texas Midland
R.R. v. Monroe 110 Tex 97, 216 S.W. 388, 380, 390; and Haver v. Central Railroad Co.,
43 L.R.A. 84, 85.)
5. ID.; ID.; CARRIER’S DUTY IN SELECTING ITS DRIVERS AND SIMILAR EMPLOYEES. — It
is the carrier’s strict obligation to select its drivers and similar employees with due regard
not only to their technical competence and physical ability, but also, no less important, to
their total personality, including their patterns of behavior, moral fibers, and social
attitude.
6. ID.; ID.; ACTUAL AND MORAL DAMAGES FOR PASSENGER’S DEATH. — P3,000 is the
minimum compensatory damages recoverable when a breach of contract of carriage
results in the passenger’s death (Arts 1764 & 2206, Civil Code) but consistent with the
policy of this Court, the minimal award should be raised to P6,000. In addition, the
parents of the decedent are entitled to moral damages to compensate for the mental
anguish they suffered. A claim therefore having been properly made, it becomes the
court’s duty to award moral damages (Mercado v. Lira, L-13328-29 & L-13358, Sept. 29,
1961). Interest upon such damages are also due to plaintiff-appellant (Art. 2210, Civil
Code).
DECISION
 BENGZON, J.P., J.:
Rogelio Corachea, on October 18, 1960, was a passenger in a taxicab owned and operated
by Pascual Perez when he was stabbed and killed by the driver, Simeon Valenzuela.
Valenzuela was prosecuted for homicide in the Court of First Instance of Batangas. Found
guilty, he was sentenced to suffer imprisonment and to indemnify the heirs of the
deceased in the sum of P6,000. Appeal from said conviction was taken to the Court of
Appeals.
On December 6, 1961, while appeal was pending in the Court of Appeals, Antonia
Maranan, Rogelio’s mother, filed an action in the Court of First Instance of Batangas to
recover damages from Perez and Valenzuela for the death of her son. Defendants asserted
that the deceased was killed in self-defense, since he first assaulted the driver by stabbing
him from behind. Defendant Perez further claimed that the death was a caso fortuito for
which the carrier was not liable.
The court a quo, after trial, found for the plaintiff and awarded her P3,000 as damages
against defendant Perez. The claim against defendant Valenzuela was dismissed. From this
ruling, both plaintiff and defendant Perez appealed to this Court, the former asking for
more damages and the latter insisting on non-liability. Subsequently, the Court of Appeals
affirmed the judgment of conviction earlier mentioned, during the pendency of the herein
appeal, and on May 19, 1964, final judgment was entered therein. (Rollo, p. 33).
Defendant-appellant relies solely on the ruling enunciated in Gillaco v. Manila Railroad Co.,
97 Phil. 884, that the carrier is under no absolute liability for assaults of its employees
upon the passengers. The attendant facts and controlling law of that case and the one at
bar are very different however. In the Gillaco case, the passenger was killed outside the
scope and the course of duty of the guilty employee. As this Court there found:
". . . when the crime took place, the guard Devesa had 10 duties to discharge in
connection with the transportation of the deceased from Calamba to Manila. The
stipulation of facts is clear that when Devesa shot and killed Gillaco, Devesa, was assigned
to guard the Manila-San Fernando (La Union) trains, and he was at Paco Station awaiting
transportation to Tutuban, the starting point of the train he was engaged to guard. In fact,
his tour of duty was to start at 9:00 a.m., two hours after the commission of the crime.
Devesa was therefore under no obligation to safeguard the passengers of the Calamba-
Manila train, where the deceased was riding; and the killing of Gillaco was not done in line
of duty. The position of Devesa at the time was that of another would be passenger, a
stranger also awaiting transportation, and not that of an employee assigned to discharge
any of the duties that the Railroad had assumed by its contract with the deceased. As a
result, Devesa’s assault can not be deemed in law a breach of Gillaco’s contract of
transportation by a servant or employee of the carrier. . . ." (Emphasis supplied)
Now here, the killing was perpetrated by the driver of the very cab transporting the
passenger, in whose hands the carrier had entrusted the duty of executing the contract of
carriage. In other words, unlike the Gillaco case, the killing of the passenger here took
place in the course of duty of the guilty employee and when the employee was acting
within the scope of his duties.
Moreover, the Gillaco case was decided under the provisions of the Civil Code of 1889
which, unlike the present Civil Code, did not impose upon common carriers absolute
liability for the safety of passengers against wilful assaults or negligent acts committed by
their employees. The death of the passenger in the Gillaco case was truly a fortuitous
event which exempted the carrier from liability. It is true that Art. 1105 of the old Civil
Code on fortuitous events has been substantially reproduced in Art. 1174 of the Civil Code
of the Philippines but both articles clearly remove from their exempting effect the case
where the law expressly provides for liability in spite of the occurrence of force majeure.
And herein significantly lies the statutory difference between the old and present Civil
Codes, in the backdrop of the factual situation before Us, which further accounts for a
different result in the Gillaco case. Unlike the old Civil Code, the new Civil Code of the
Philippines expressly makes the common carrier liable for intentional assaults committed
by its employees upon its passengers, by the wording of Art. 1759 which categorically
states that.
"Common carriers are liable for the death of or injuries to passengers although the
negligence or wilful acts of the former’s employees, although such employees may have
acted beyond the scope of their authority or in violation of the orders of the common
carriers."
The Civil Code provisions on the subject of Common Carriers are new and were taken from
Anglo-American Law. There, the basis of the carrier’s liability for assaults on passengers
committed by its drivers rests either on (1) the doctrine of respondent superior or (2) the
principle that it is the carrier’s implied duty to transport the passenger safely.
Under the first, which is the minority view, the carrier is liable only when the act of the
employee is within the scope of his authority and duty. It is not sufficient that the act be
within the course of employment only.
Under the second view, upheld by the majority and also by the later cases, it is enough
that the assault happens within the course of the employee’s duty. It is no defense for the
carrier that the act was done in excess of authority or in disobedience of the carrier’s
orders. The carrier’s liability here is absolute in the sense that it practically secures the
passengers from assaults committed by its own employees.
As can be gleaned from Art. 1759, the Civil Code of the Philippines evidently follows the
rule based on the second view. At least three very cogent reasons underlie this rule. As
explained in Texas Midland R.R. v. Monroe, 110 Tex. 97, 216 S.W. 388, 389-390, and
Haver v. Central Railroad Co., 43 LRA 84, 85; (1) the special undertaking of the carrier
requires that it furnish its passenger that full measure of protection afforded by the
exercise of the high degree of care prescribed by the law, inter alia from violence and
insults at the hands of strangers and other passengers, but above all, from the acts of the
carrier’s own servants charged with the passenger’s safety; (2) said liability of the carrier
for the servant’s violation of duty to passengers, is the result of the former’s confiding in
the servant’s hands the performance of his contract to safely transport the passenger,
delegating therewith the duty of protecting the passenger with the utmost care prescribed
by law; and (3) as between the carrier and the passenger, the former must bear the risk
of wrongful acts or negligence of the carrier’s employees against passengers, since it, and
not the passengers, has power to select and remove them.
Accordingly, it is the carrier’s strict obligation to select its drivers and similar employees
with due regard not only to their technical competence and physical ability, but also, no
less important, to their total personality, including their patterns of behavior, moral fibers,
and social attitude.
Applying this stringent norm to the facts in this case, therefore, the lower court rightly
adjudged the defendant carrier liable pursuant to Art. 1759 of the Civil Code. The
dismissal of the claim against the defendant driver was also correct. Plaintiff’s action was
predicated on breach of contract of carriage and the cab driver was not a party thereto.
His civil liability is covered in the criminal case wherein he was convicted by final
judgment.
In connection with the award of damages, the court a quo granted only P3,000 to plaintiff-
appellant. This is the minimum compensatory damages amount recoverable under Art.
1764 in connection with Art. 2206 of the Civil Code when a breach of contract results in
the passenger’s death. As has been the policy followed by this Court, this minimal award
should be increased to P6,000. As to other alleged actual damages, the lower court’s
finding that plaintiff’s evidence thereon was not convincing should not be disturbed. Still,
Arts. 2206 and 1764 award moral damages in addition to compensatory damages, to the
parents of the passenger killed to compensate for the mental anguish they suffered. A
claim therefor having been properly made, it becomes the court’s duty to award moral
damages. Plaintiff demands P5,000 as moral damages; however, in the circumstances, We
consider P3,000 moral damages, in addition to the P6,000 damages afore-stated, as
sufficient. Interest upon such damages are also due to plaintiff-appellant.
Wherefore, with the modification increasing the award of actual damages in plaintiff’s
favor to P6,000, plus P3,000 moral damages, with legal interest on both from the filing of
the complaint on December 6, 1961 until the whole amount is paid, the judgment
appealed from is affirmed in all other respects. No costs. So ordered.
G.R. No. L-19161             April 29, 1966
MANILA RAILROAD COMPANY, petitioner,
vs.
MACARIA BALLESTEROS, TIMOTEO CAMAYO, JOSE REYES and JULIAN MAIMBAN,
JR., respondents.
Gov't Corp. Counsel S. M. Gopengco and Atty. R. G. Fernando, for petitioner.
George G. Arbolario, for respondents.
MAKALINTAL, J.:
In civil case No. 45968 of the Court of First Instance of Manila (Macaria Ballesteros,
Timoteo Camayo, Jose Reyes and Julian Maimban, Jr. vs. Manila Railroad Company) the
defendant was adjudged to pay damages in the following amounts: P2,400 to Macaria
Ballesteros; P4,000 to Timoteo Camayo; P3,000 to Jose Reyes: and P2,000, plus P1,000
as attorney's fees, to Julian Maimban, Jr.
The defendant appealed from the judgment, but upon motion by the plaintiffs, the trial
court, by order dated October 14, 1961, dismissed the appeal on the ground that it was
"manifestly and palpably frivolous and interposed ostensibly to delay the settlement of the
just and reasonable claims of the herein plaintiffs, which have been pending since 1958."
The defendant moved to reconsider, and upon denial of its motion instituted in this Court
the instant petition for mandamus to set aside the order of dismissal and to order
respondent court to give due course to the appeal.
In filing the petition directly with this Court, petitioner evidently intended to raise only
questions of law in the appeal contemplated, since under Rule 41, section 15, "when
erroneously a motion to dismiss an appeal is granted or a record on appeal is disallowed
by the trial court, a proper petition for mandamus may be filed in the appellate court;"
and under section 17(6) of the Judiciary Act this Court may review on appeal only
questions of law in civil cases decided by inferior courts unless the value in controversy
exceeds P200,000.
The fact that an appeal is frivolous and interposed only for purposes of delay has been
recognized as a valid ground to deny issuance of the writ of mandamus to compel the trial
court to approve and certify the appeal. In De la Cruz vs. Blanco and Quevedo, 73 Phil.
596, We held:
And where as in the instant case, the dismissal has been ordered by the trial court, it
would not be disturbed in the Appellate Court if the latter finds the appeal to have been
interposed ostensibly for delay. It has been held that a frivolous appeal is one
presenting no justiciable question or one so readily cognizable as devoid of merit on the
face of the record that there is little, if any, prospect that it can over succeed. The
instant case is one such instance in which the appeal is evidently without merit, taken
manifestly for delay.
And in Paner vs. Yatco, 87 Phil. 271, We denied the writ prayed for and held that "while
strictly and legally speaking the petition may be granted, we may, before acting thereon,
inquire into the facts involved in order to determine whether once the writ is granted and
the case is brought up here on appeal the appellant has any chance, even possibility, of
having the basic decision of the trial court set aside or modified; for if the appellant has
not that prospect or likelihood then the granting of the writ and the consequent appeal
would be futile and would mean only a waste of time to the parties and to this Court."
The material facts, as found by respondent court in its decision, are as follows: Private
respondents here, plaintiffs below, were passengers on petitioner's bus, the driver of
which was Jose Anastacio. In Bayombong, Nueva Vizcaya, Anastacio stopped the bus and
got off to replace a defective spark plug. While he was thus engaged, one Dionisio Abello,
an auditor assigned to defendant company by the General Auditing Office, took the wheel
and told the driver to sit somewhere else. With Abello driving, the bus proceeded on its
way, from time to time stopping to pick up passengers. Anastacio tried twice to take the
wheel back but Abello would not relinquish it. Then, in the language of the trial court,
"while the bus was negotiating between Km. posts 328 and 329 (in Isabela) a freight truck
... driven by Marcial Nocum ... bound for Manila, was also negotiating the same place;
when these two vehicles were about to meet at the bend of the road Marcial Nocum, in
trying to evade several holes on the right lane, where his truck was running, swerved his
truck towards the middle part of the road and in so doing, the left front fender and left
side of the freight truck smashed the left side of the bus resulting in extensive damages to
the body of the bus and injuries to seventeen of its passengers, ... including the plaintiffs
herein."
In rejecting petitioner's contention that the negligence of Marcial Nocum could not be
imputed to it and relieved it from liability, the trial court found that Dionisio Abello "was
likewise reckless when he was driving the bus at the rate of from 40 to 50 kilometers per
hour on a bumpy road at the moment of the collision."
Another defense put up by petitioner is that since Abello was not its employee it should
not be held responsible for his acts. This defense was correctly overruled by the trial court,
considering the provisions of Article 1763 of the Civil Code and section 48 (b) of the Motor
Vehicle Law, which respectively provide as follows:
Art. 1763. A common carrier is responsible for injuries suffered by a passenger on
account of the wilfull acts or negligence of other passengers or of strangers, if the
common carrier's employees through the exercise of the diligence of a good father of a
family could have prevented or stopped the act or omission.
Sec. 48(b). No professional chauffeur shall permit any unlicensed person to drive the
motor vehicle under his control, or permit a person, sitting beside him or in any other
part of the car, to interfere with him in the operation of the motor vehicle, by allowing
said person to take hold of the steering wheel, or in any other manner take part in the
manipulation or control of the car.
It appears further, and so the trial court found, that there were negotiations between the
parties to compromise the case, as a result of which respondents herein, plaintiffs below,
considerably reduced their claims to the amounts subsequently awarded in the judgment;
that petitioner had in fact settled the claims of the other passengers who were also injured
in the same accident and even the claim for damages filed in another action by the owner
of the freight truck; and that the Government Corporate Counsel himself, who represents
herein petitioner, rendered two separate opinions (Op. No. 86, May 19, 1960; and Op. No.
99, series of 1961) wherein, after analyzing the facts and the law applicable, he reached
the conclusion that the acts of the bus personnel, particularly "in allowing Mr. Abello to
drive despite two occasions when the bus stopped and the regular driver could have taken
over, constitute reckless imprudence and wanton injurious conduct on the part of the MRR
employees." On the basis of those opinions the Government Corporate Counsel advised
petitioner that the offer of the claimants was reasonable and should be accepted. His
advice, however, was not favorably acted upon, petitioner obviously preferring to litigate.
The issues proposed to be taken up on appeal, as set forth in the petition, are whether or
not Dionisio Abello acted with reckless negligence while driving petitioner's bus at the time
of the accident, and whether or not petitioner may be held liable on account of such
negligence, considering that he was not its employee. These are no longer justiciable
questions which would justify our issuing the peremptory writ prayed for. The first is a
question of fact on which the affirmative finding of respondent court is not reviewable by
Us; and the second is one as to which there can be no possible doubt in view of the
provisions of the Civil Code and of the Motor Vehicle Law hereinbefore cited. There would
be no point in giving the appeal due course.
The writ prayed for is denied, with costs against petitioner.
G.R. No. 145804. February 6, 2003
LIGHT RAIL TRANSIT AUTHORITY & RODOLFO ROMAN, petitioners,
vs.  MARJORIE NAVIDAD, Heirs of the Late NICANOR NAVIDAD & PRUDENT
SECURITY AGENCY, Respondents.
DECISION
VITUG, J.:
The case before the Court is an appeal from the decision and resolution of the Court of
Appeals, promulgated on 27 April 2000 and 10 October 2000, respectively, in CA-G.R. CV
No. 60720, entitled Marjorie Navidad and Heirs of the Late Nicanor Navidad vs. Rodolfo
Roman, et. al., which has modified the decision of 11 August 1998 of the Regional Trial
Court, Branch 266, Pasig City, exonerating Prudent Security Agency (Prudent) from
liability and finding Light Rail Transit Authority (LRTA) and Rodolfo Roman liable for
damages on account of the death of Nicanor Navidad.
On 14 October 1993, about half an hour past seven oclock in the evening, Nicanor
Navidad, then drunk, entered the EDSA LRT station after purchasing a token (representing
payment of the fare). While Navidad was standing on the platform near the LRT tracks,
Junelito Escartin, the security guard assigned to the area approached Navidad. A
misunderstanding or an altercation between the two apparently ensued that led to a fist
fight. No evidence, however, was adduced to indicate how the fight started or who,
between the two, delivered the first blow or how Navidad later fell on the LRT tracks. At
the exact moment that Navidad fell, an LRT train, operated by petitioner Rodolfo Roman,
was coming in. Navidad was struck by the moving train, and he was killed instantaneously.
On 08 December 1994, the widow of Nicanor, herein respondent Marjorie Navidad, along
with her children, filed a complaint for damages against Junelito Escartin, Rodolfo Roman,
the LRTA, the Metro Transit Organization, Inc. (Metro Transit), and Prudent for the death
of her husband. LRTA and Roman filed a counterclaim against Navidad and a cross-claim
against Escartin and Prudent. Prudent, in its answer, denied liability and averred that it
had exercised due diligence in the selection and supervision of its security guards.
The LRTA and Roman presented their evidence while Prudent and Escartin, instead of
presenting evidence, filed a demurrer contending that Navidad had failed to prove that
Escartin was negligent in his assigned task. On 11 August 1998, the trial court rendered its
decision; it adjudged:
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against the
defendants Prudent Security and Junelito Escartin ordering the latter to pay jointly and
severally the plaintiffs the following:
a) 1) Actual damages of P44,830.00;
2) Compensatory damages of P443,520.00;
3) Indemnity for the death of Nicanor Navidad in the sum of P50,000.00;
b) Moral damages of P50,000.00;
c) Attorneys fees of P20,000;
d) Costs of suit.
The complaint against defendants LRTA and Rodolfo Roman are dismissed for lack of
merit.
The compulsory counterclaim of LRTA and Roman are likewise dismissed.
Prudent appealed to the Court of Appeals. On 27 August 2000, the appellate court
promulgated its now assailed decision exonerating Prudent from any liability for the death
of Nicanor Navidad and, instead, holding the LRTA and Roman jointly and severally liable
thusly:
WHEREFORE, the assailed judgment is hereby MODIFIED, by exonerating the appellants
from any liability for the death of Nicanor Navidad, Jr. Instead, appellees Rodolfo Roman
and the Light Rail Transit Authority (LRTA) are held liable for his death and are hereby
directed to pay jointly and severally to the plaintiffs-appellees, the following amounts:
a) P44,830.00 as actual damages;
b) P50,000.00 as nominal damages;
c) P50,000.00 as moral damages;
d) P50,000.00 as indemnity for the death of the deceased; and
e) P20,000.00 as and for attorneys fees.
The appellate court ratiocinated that while the deceased might not have then as yet
boarded the train, a contract of carriage theretofore had already existed when the victim
entered the place where passengers were supposed to be after paying the fare and getting
the corresponding token therefor. In exempting Prudent from liability, the court stressed
that there was nothing to link the security agency to the death of Navidad. It said that
Navidad failed to show that Escartin inflicted fist blows upon the victim and the evidence
merely established the fact of death of Navidad by reason of his having been hit by the
train owned and managed by the LRTA and operated at the time by Roman. The appellate
court faulted petitioners for their failure to present expert evidence to establish the fact
that the application of emergency brakes could not have stopped the train.
The appellate court denied petitioners motion for reconsideration in its resolution of 10
October 2000.
In their present recourse, petitioners recite alleged errors on the part of the appellate
court; viz:
I.
THE HONORABLE COURT OF APPEALS GRAVELY ERRED BY DISREGARDING THE FINDINGS
OF FACTS BY THE TRIAL COURT
II.
THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN FINDING THAT PETITIONERS
ARE LIABLE FOR THE DEATH OF NICANOR NAVIDAD, JR.
III.
THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN FINDING THAT RODOLFO
ROMAN IS AN EMPLOYEE OF LRTA.
Petitioners would contend that the appellate court ignored the evidence and the factual
findings of the trial court by holding them liable on the basis of a sweeping conclusion that
the presumption of negligence on the part of a common carrier was not overcome.
Petitioners would insist that Escartins assault upon Navidad, which caused the latter to fall
on the tracks, was an act of a stranger that could not have been foreseen or prevented.
The LRTA would add that the appellate courts conclusion on the existence of an employer-
employee relationship between Roman and LRTA lacked basis because Roman himself had
testified being an employee of Metro Transit and not of the LRTA.
Respondents, supporting the decision of the appellate court, contended that a contract of
carriage was deemed created from the moment Navidad paid the fare at the LRT station
and entered the premises of the latter, entitling Navidad to all the rights and protection
under a contractual relation, and that the appellate court had correctly held LRTA and
Roman liable for the death of Navidad in failing to exercise extraordinary diligence
imposed upon a common carrier.
Law and jurisprudence dictate that a common carrier, both from the nature of its business
and for reasons of public policy, is burdened with the duty of exercising utmost diligence in
ensuring the safety of passengers. The Civil Code, governing the liability of a common
carrier for death of or injury to its passengers, provides:
Article 1755. A common carrier is bound to carry the passengers safely as far as human
care and foresight can provide, using the utmost diligence of very cautious persons, with a
due regard for all the circumstances.
Article 1756. In case of death of or injuries to passengers, common carriers are presumed
to have been at fault or to have acted negligently, unless they prove that they observed
extraordinary diligence as prescribed in articles 1733 and 1755.
Article 1759. Common carriers are liable for the death of or injuries to passengers through
the negligence or willful acts of the formers employees, although such employees may
have acted beyond the scope of their authority or in violation of the orders of the common
carriers.
This liability of the common carriers does not cease upon proof that they exercised all the
diligence of a good father of a family in the selection and supervision of their employees.
Article 1763. A common carrier is responsible for injuries suffered by a passenger on
account of the willful acts or negligence of other passengers or of strangers, if the
common carriers employees through the exercise of the diligence of a good father of a
family could have prevented or stopped the act or omission.
The law requires common carriers to carry passengers safely using the utmost diligence of
very cautious persons with due regard for all circumstances. Such duty of a common
carrier to provide safety to its passengers so obligates it not only during the course of the
trip but for so long as the passengers are within its premises and where they ought to be
in pursuance to the contract of carriage. The statutory provisions render a common carrier
liable for death of or injury to passengers (a) through the negligence or wilful acts of
its employees or b) on account of wilful acts or negligence of other passengers or
of strangers if the common carriers employees through the exercise of due
diligence could have prevented or stopped the act or omission. In case of such
death or injury, a carrier is presumed to have been at fault or been negligent, and by
simple proof of injury, the passenger is relieved of the duty to still establish the fault or
negligence of the carrier or of its employees and the burden shifts upon the carrier to
prove that the injury is due to an unforeseen event or to force majeure. In the absence of
satisfactory explanation by the carrier on how the accident occurred, which petitioners,
according to the appellate court, have failed to show, the presumption would be that it has
been at fault, an exception from the general rule that negligence must be proved.
The foundation of LRTAs liability is the contract of carriage and its obligation to indemnify
the victim arises from the breach of that contract by reason of its failure to exercise the
high diligence required of the common carrier. In the discharge of its commitment to
ensure the safety of passengers, a carrier may choose to hire its own employees or avail
itself of the services of an outsider or an independent firm to undertake the task. In either
case, the common carrier is not relieved of its responsibilities under the contract of
carriage.
Should Prudent be made likewise liable? If at all, that liability could only be for tort under
the provisions of Article 2176 and related provisions, in conjunction with Article 2180, of
the Civil Code. The premise, however, for the employers liability is negligence or fault on
the part of the employee. Once such fault is established, the employer can then be made
liable on the basis of the presumption juris tantum  that the employer failed to
exercise diligentissimi patris families  in the selection and supervision of its employees. The
liability is primary and can only be negated by showing due diligence in the selection and
supervision of the employee, a factual matter that has not been shown. Absent such a
showing, one might ask further, how then must the liability of the common carrier, on the
one hand, and an independent contractor, on the other hand, be described? It would be
solidary. A contractual obligation can be breached by tort and when the same act or
omission causes the injury, one resulting in culpa contractual  and the other in culpa
aquiliana,  Article 2194 of the Civil Code can well apply. In fine, a liability for tort may arise
even under a contract, where tort is that which breaches the contract. Stated differently,
when an act which constitutes a breach of contract would have itself constituted the
source of a quasi-delictual liability had no contract existed between the parties, the
contract can be said to have been breached by tort, thereby allowing the rules on tort to
apply.
Regrettably for LRT, as well as perhaps the surviving spouse and heirs of the late Nicanor
Navidad, this Court is concluded by the factual finding of the Court of Appeals that there is
nothing to link (Prudent) to the death of Nicanor (Navidad), for the reason that the
negligence of its employee, Escartin, has not been duly proven x x x. This finding of the
appellate court is not without substantial justification in our own review of the records of
the case.
There being, similarly, no showing that petitioner Rodolfo Roman himself is guilty of any
culpable act or omission, he must also be absolved from liability. Needless to say, the
contractual tie between the LRT and Navidad is not itself a juridical relation between the
latter and Roman; thus, Roman can be made liable only for his own fault or negligence.
The award of nominal damages in addition to actual damages is untenable. Nominal
damages are adjudicated in order that a right of the plaintiff, which has been violated or
invaded by the defendant, may be vindicated or recognized, and not for the purpose of
indemnifying the plaintiff for any loss suffered by him. It is an established rule that
nominal damages cannot co-exist with compensatory damages.
WHEREFORE, the assailed decision of the appellate court is AFFIRMED with
MODIFICATION but only in that (a) the award of nominal damages is DELETED and (b)
petitioner Rodolfo Roman is absolved from liability. No costs.
SO ORDERED.
[G.R. No. 29462. March 7, 1929.]
IGNACIO DEL PRADO, Plaintiff-Appellee, v. MANILA ELECTRIC CO., Defendant-
Appellant.
Ross, Lawrence & Selph and Antonio T. Carrascoso, jr., for Appellant.
Vicente Sotto, for Appellee.
SYLLABUS
1. CARRIERS; STREET RAILWAY; PASSENGER BOARDING MOVING CAR; DUTY OF
MOTORMAN NOT TO INCREASE RISK. — Though there is no obligation on the part of a
street railway company to stop its cars to take on intending passengers at other points
than those appointed for stoppage, nevertheless when the motorman sees a person
attempting to board the car while in motion, and at a place not appointed for stopping, he
should not do any act to increase the peril of such person; and if, in violation of this duty,
the motorman in charge of a car prematurely accelerates speed while the intending
passenger is in the act of boarding the car, with the result that he slips and gets his foot
crushed under the wheel of the moving car, the company is civilly liable in damages.
2. ID.; ID.; ID.; OBLIGATION OF COMPANY TO PASSENGER. — The relation between a
carrier of passengers for hire and its patrons is of a contractual nature; and the failure
upon part of the carrier to use due care in conveying its passengers safely is a breach of
obligation under article 1101, and related provisions, of the Civil Code. Furthermore, the
duty that the carrier of passengers owes to its patrons extends to persons boarding the
cars as well as to those alighting therefrom.
3. MASTER AND SERVANT; NEGLIGENCE OF SERVANT; BREACH OF CONTRACTUAL DUTY.
— The defense indicated in the last paragraph of article 1903 of the Civil Code is not
available to the master when his servant is guilty of a breach of duty under article 1101
and related provisions of said Code.
4. NEGLIGENCE; CONTRIBUTORY NEGLIGENCE; MITIGATION OF DAMAGES. —
Contributory negligence upon part of a plaintiff, not amounting to the proximate cause of
his injury, is not completely destructive of his right of action in cases where liability arises
from breach of a contractual duty; but such contributory negligence goes in mitigation of
damages, under article 1103 of the Civil Code.
Per JOHNSON, J., dissenting:
5. STREET RAILWAY COMPANY, LIABILITY OF, FOR ALLEGED DAMAGES TO PASSENGERS.
— A street railway company should not be held liable for damages done to a passenger
when the motorman managed the car carefully and with ordinary prudence at the moment
of the alleged accident, and when the passenger acted with imprudence and lack of care in
attempting to board a street car while the same was in motion. There is nothing in the
record in the present case to justify a contribution of damages. One is not entitled to
recover damages for personal injuries which he himself, through his own negligence,
occasioned, without any negligence, imprudence or malice on the part of the person or
entity charged with causing said damages.
DECISION
STREET, J.:
This action was instituted in the Court of First Instance of Manila by Ignacio del Prado to
recover damages in the amount of P50,000 for person, injuries alleged to have been
caused by the negligence of the defendant, the Manila Electric Company, in the operation
of one of its street cars in the City of Manila. Upon hearing the cause the trial court
awarded to the plaintiff the sum of P10,000, as damages, with costs of suit, and the
defendant appealed.
The appellant, the Manila Electric Company, is engaged in operating street cars in the City
of Manila for the conveyance of passengers; and on the morning of November 18, 1925,
one Teodorico Florenciano, as appellant’s motorman, was in charge of car No. 74 running
from east to west on R. Hidalgo Street, the scene of the accident being at a point near the
intersection of said street and Mendoza Street. After the car had stopped at its appointed
place for taking on and letting off passengers, just east of the intersection, it resumed its
course at a moderate speed under the guidance of the motorman. The car had proceeded
only a short distance, however, when the plaintiff, Ignacio del Prado, ran across the street
to catch the car, his approach being made from the left. The car was of the kind having
entrance and exit at either end, and the movement of the plaintiff was so timed that he
arrived at the front entrance of the car at the moment when the car was passing.
The testimony of the plaintiff and of Ciriaco Guevara, one of his witnesses, tends to show
that the plaintiff, upon approaching the car, raised his hand as an indication to the
motorman of his desire to board the car, in response to which the motorman eased up a
little, without stopping. Upon this the plaintiff seized, with his left hand, the front
perpendicular handpost, at the same time placing his left foot upon the platform. However,
before the plaintiff’s position had become secure, and even before his raised right foot had
reached the platform, the motorman applied the power, with the result that the car gave a
slight lurch forward. This sudden impulse to the car caused the plaintiff’s foot to slip, and
his hand was jerked loose from the handpost. He therefore fell to the ground, and his right
foot was caught and crushed by the moving car. The next day the member had to be
amputated in the hospital. The witness, Ciriaco Guevara, also stated that, as the plaintiff
started to board the car, he grasped the handpost on either side with both right and left
hand. The latter statement may possibly be incorrect as regards the use of his right hand
by the plaintiff, but we are of the opinion that the finding of the trial court to the effect
that the motorman slowed up slightly as the plaintiff was boarding the car and that the
plaintiff’s fall was due in part at least to a sudden forward movement at the moment when
the plaintiff put his foot on the platform is supported by the evidence and ought not to be
disturbed by us.
The motorman stated at the trial that he did not see the plaintiff attempting to board the
car; that he did not accelerate the speed of the car as claimed by the plaintiff’s witnesses;
and that he in fact knew nothing of the incident until after the plaintiff had been hurt and
some one called to him to stop. We are not convinced of the complete candor of this
statement, for we are unable to see how a motorman operating this car could have failed
to see a person boarding the car under-the circumstances revealed in this case. It must be
remembered that the front handpost which, as all witnesses agree, was grasped by the
plaintiff in attempting to board the car, was immediately on the left side of the motorman.
With respect to the legal aspects of the case we may observe at the outset that there is no
obligation on the part of a street railway company to stop its cars to let on intending
passengers at other points than those appointed for stoppage. In fact it would be
impossible to operate a system of street cars if a company engaged in this business were
required to stop any and everywhere to take on people who are too indolent, or who
imagine themselves to be in too great a hurry, to go to the proper places for boarding the
cars. Nevertheless, although the motorman of this car was not bound to stop to let the
plaintiff on, it was his duty to do no act that would have the effect of increasing the
plaintiff’s peril while he was attempting to board the car. The premature acceleration of
the car was, in our opinion, a breach of this duty.
The relation between a carrier of passengers for hire and its patrons is of a contractual
nature; and a failure on the part of the carrier to use due care in carrying its passengers
safely is a breach of duty (culpa contractual) under articles 1101, 1103, and 1104 of the
Civil Code. Furthermore, the duty that the carrier of passengers owes to its patrons
extends to persons boarding the cars as well as to those alighting therefrom. The case of
Cangco v. Manila Railroad Co. (38 Phil., 768), supplies an instance of the violation of this
duty with respect to a passenger who was getting off of a train. In that case the plaintiff
stepped off of a moving train, while it was slowing down in a station, and at a time when it
was too dark for him to see clearly where he was putting his feet. The employees of the
company had carelessly left watermelons on the platform at the place where the plaintiff
alighted, with the result that his feet slipped and he fell under the car, where his right arm
was badly injured. This court held that the railroad company was liable for breach of
positive duty (culpa contractual), and the plaintiff was awarded damages in the amount of
P2,500 for the loss of his arm. In the opinion in that case the distinction is clearly drawn
between a liability for negligence arising from breach of contractual duty and that arising
under articles 1902 and 1903 of the Civil Code (culpa aquiliana).
The distinction between these two sorts of negligence is important in this jurisdiction, for
the reason that where liability arises from a mere tort (culpa aquiliana), not involving a
breach of positive obligation, an employer, or master, may exculpate himself, under the
last paragraph of article 1903 of the Civil Code, by proving that he had exercised due
diligence to prevent the damage; whereas this defense is not available if the liability of the
master arises from a breach of contractual duty (culpa contractual). in the case before us
the company pleaded as a special defense that it had used all the diligence of a good
father of a family to prevent the damage suffered by the plaintiff; and to establish this
contention the company introduced testimony showing that due care had been used in
training and instructing the motorman in charge of this car in his art. But this proof is
irrelevant in view of the fact that the liability involved was derived from a breach of
obligation under article 1101 of the Civil Code and related provisions. (Manila Railroad Co.
v. Compañia Trasatlantica and Atlantic, Gulf & Pacific Co., 38 Phil., 875, 887; De Guia v.
Manila Electric Railroad & Light Co., 40 Phil., 706, 710.)
Another practical difference between liability for negligence arising under article 1902 of
the Civil Code and liability arising from negligence in the performance of a positive duty,
under article 1101 and related provisions of the Civil Code, is that, in dealing with the
latter form of negligence, the court is given a discretion to mitigate liability according to
the circumstances of the case (art 1103). No such general discretion is given by the Code
in dealing with liability arising under article 1902; though possibly the same end is reached
by courts in dealing with the latter form of liability because of the latitude of the
considerations pertinent to cases arising under this article.
As to the contributory negligence of the plaintiff, we are of the opinion that it should be
treated, as in Rakes v. Atlantic, Gulf and Pacific Co. (7 Phil., 359), as a mitigating
circumstance under article 1103 of the Civil Code. It is obvious that the plaintiff’s
negligence in attempting to board the moving car was not the proximate cause of the
injury. The direct and proximate cause of the injury was the act of appellant’s motorman
in putting on the power prematurely. A person boarding a moving car must be taken to
assume the risk of injury from boarding the car under the conditions open to his view, but
he cannot fairly be held to assume the risk that the motorman, having the situation in
view, will increase his peril by accelerating the speed of the car before he is planted safely
on the platform. Again, the situation before us is one where the negligent act of the
company’s servant succeeded the negligent act of the plaintiff, and the negligence of the
company must be considered the proximate cause of the injury. The rule here applicable
seems to be analogous to, if not identical with that which is sometimes referred to as the
doctrine of "the last clear chance." In accordance with this doctrine, the contributory
negligence of the party injured will not defeat the action if it be shown that the defendant
might, by the exercise of reasonable care and prudence, have avoided the consequences
of the negligence of the injured party (20 R. C. L., p. 139; Carr v. Interurban Ry. Co., 185
Iowa, 872; 171 N. W., 167). The negligence of the plaintiff was, however, contributory to
the accident and must be considered as a mitigating circumstance.
With respect to the effect of this injury upon the plaintiff’s earning power, we note that,
although he lost his foot, he is able to use an artificial member without great
inconvenience and his earning capacity has probably not been reduced by more than 30
per centum. In view of the precedents found in our decisions with respect to the damages
that ought to be awarded for the loss of a limb, and more particularly Rakes v. Atlantic,
Gulf and Pacific Co. (7 Phil., 359); Cangco v. Manila Railroad Co. (38 Phil., 768); and
Borromeo v. Manila Electric Railroad and Light Co. (44 Phil., 165), and in view of all the
circumstances connected with the case, we are of the opinion that the plaintiff will be
adequately compensated by an award of P2,500.
It being understood, therefore, that the appealed judgment is modified by reducing the
recovery to the sum of P2,500, the judgment, as thus modified, is affirmed. So ordered,
with costs against the Appellant.
 G.R. No. 95582 October 7, 1991
DANGWA TRANSPORTATION CO., INC. and THEODORE LARDIZABAL y
MALECDAN, petitioners,
vs.
COURT OF APPEALS, INOCENCIA CUDIAMAT, EMILIA CUDIAMAT BANDOY,
FERNANDO CUDLAMAT, MARRIETA CUDIAMAT, NORMA CUDIAMAT, DANTE
CUDIAMAT, SAMUEL CUDIAMAT and LIGAYA CUDIAMAT, all Heirs of the late
Pedrito Cudiamat represented by Inocencia Cudiamat, respondents.
Francisco S. Reyes Law Office for petitioners.
Antonio C. de Guzman for private respondents.
REGALADO, J.:
On May 13, 1985, private respondents filed a complaint for damages against petitioners
for the death of Pedrito Cudiamat as a result of a vehicular accident which occurred on
March 25, 1985 at Marivic, Sapid, Mankayan, Benguet. Among others, it was alleged that
on said date, while petitioner Theodore M. Lardizabal was driving a passenger bus
belonging to petitioner corporation in a reckless and imprudent manner and without due
regard to traffic rules and regulations and safety to persons and property, it ran over its
passenger, Pedrito Cudiamat. However, instead of bringing Pedrito immediately to the
nearest hospital, the said driver, in utter bad faith and without regard to the welfare of the
victim, first brought his other passengers and cargo to their respective destinations before
banging said victim to the Lepanto Hospital where he expired.
On the other hand, petitioners alleged that they had observed and continued to observe
the extraordinary diligence required in the operation of the transportation company and
the supervision of the employees, even as they add that they are not absolute insurers of
the safety of the public at large. Further, it was alleged that it was the victim's own
carelessness and negligence which gave rise to the subject incident, hence they prayed for
the dismissal of the complaint plus an award of damages in their favor by way of a
counterclaim.
On July 29, 1988, the trial court rendered a decision, effectively in favor of petitioners,
with this decretal portion:
IN VIEW OF ALL THE FOREGOING, judgment is hereby pronounced that Pedrito
Cudiamat was negligent, which negligence was the proximate cause of his death.
Nonetheless, defendants in equity, are hereby ordered to pay the heirs of Pedrito
Cudiamat the sum of P10,000.00 which approximates the amount defendants initially
offered said heirs for the amicable settlement of the case. No costs.
SO ORDERED.
Not satisfied therewith, private respondents appealed to the Court of Appeals which, in a
decision in CA-G.R. CV No. 19504 promulgated on August 14, 1990, set aside the decision
of the lower court, and ordered petitioners to pay private respondents:
1. The sum of Thirty Thousand (P30,000.00) Pesos by way of indemnity for death of
the victim Pedrito Cudiamat;
2. The sum of Twenty Thousand (P20,000.00) by way of moral damages;
3. The sum of Two Hundred Eighty Eight Thousand (P288,000.00) Pesos as actual and
compensatory damages;
4. The costs of this suit.
Petitioners' motion for reconsideration was denied by the Court of Appeals in its resolution
dated October 4, 1990, hence this petition with the central issue herein being whether
respondent court erred in reversing the decision of the trial court and in finding petitioners
negligent and liable for the damages claimed.
It is an established principle that the factual findings of the Court of Appeals as a rule are
final and may not be reviewed by this Court on appeal. However, this is subject to settled
exceptions, one of which is when the findings of the appellate court are contrary to those
of the trial court, in which case a reexamination of the facts and evidence may be
undertaken.
In the case at bar, the trial court and the Court of Appeal have discordant positions as to
who between the petitioners an the victim is guilty of negligence. Perforce, we have had to
conduct an evaluation of the evidence in this case for the proper calibration of their
conflicting factual findings and legal conclusions.
The lower court, in declaring that the victim was negligent, made the following findings:
This Court is satisfied that Pedrito Cudiamat was negligent in trying to board a moving
vehicle, especially with one of his hands holding an umbrella. And, without having given
the driver or the conductor any indication that he wishes to board the bus. But
defendants can also be found wanting of the necessary diligence. In this connection, it
is safe to assume that when the deceased Cudiamat attempted to board defendants'
bus, the vehicle's door was open instead of being closed. This should be so, for it is
hard to believe that one would even attempt to board a vehicle (i)n motion if the door
of said vehicle is closed. Here lies the defendant's lack of diligence. Under such
circumstances, equity demands that there must be something given to the heirs of the
victim to assuage their feelings. This, also considering that initially, defendant common
carrier had made overtures to amicably settle the case. It did offer a certain monetary
consideration to the victim's heirs. 
However, respondent court, in arriving at a different opinion, declares that:

From the testimony of appellees' own witness in the person of Vitaliano Safarita, it is
evident that the subject bus was at full stop when the victim Pedrito Cudiamat boarded
the same as it was precisely on this instance where a certain Miss Abenoja alighted
from the bus. Moreover, contrary to the assertion of the appellees, the victim did
indicate his intention to board the bus as can be seen from the testimony of the said
witness when he declared that Pedrito Cudiamat was no longer walking and made a
sign to board the bus when the latter was still at a distance from him. It was at the
instance when Pedrito Cudiamat was closing his umbrella at the platform of the bus
when the latter made a sudden jerk movement (as) the driver commenced to
accelerate the bus.
Evidently, the incident took place due to the gross negligence of the appellee-driver in
prematurely stepping on the accelerator and in not waiting for the passenger to first
secure his seat especially so when we take into account that the platform of the bus
was at the time slippery and wet because of a drizzle. The defendants-appellees utterly
failed to observe their duty and obligation as common carrier to the end that they
should observe extra-ordinary diligence in the vigilance over the goods and for the
safety of the passengers transported by them according to the circumstances of each
case (Article 1733, New Civil Code).  that would have the effect of increasing the peril to a passenger while he was attempting
After a careful review of the evidence of record, we find no reason to disturb the above
holding of the Court of Appeals. Its aforesaid findings are supported by the testimony of
petitioners' own witnesses. One of them, Virginia Abalos, testified on cross-examination as
follows:
Q: It is not a fact Madam witness, that at bunkhouse 54, that is before the place of the
incident, there is a crossing?
A: The way going to the mines but it is not being pass(ed) by the bus.
Q: And the incident happened before bunkhouse 56, is that not correct?
A: It happened between 54 and 53 bunkhouses.  same cannot be considered negligent under the circumstances. As clearly explained in the
The bus conductor, Martin Anglog, also declared:
Q: When you arrived at Lepanto on March 25, 1985, will you please inform this
Honorable Court if there was anv unusual incident that occurred?
A: When we delivered a baggage at Marivic because a person alighted there between
Bunkhouse 53 and 54.
Q: What happened when you delivered this passenger at this particular place in
Lepanto?
A: When we reached the place, a passenger alighted and I signalled my driver. When
we stopped we went out because I saw an umbrella about a split second and I signalled
again the driver, so the driver stopped and we went down and we saw Pedrito
Cudiamat asking for help because he was lying down.
Q: How far away was this certain person, Pedrito Cudiamat, when you saw him lying
down — from the bus how far was he?
A: It is about two to three meters.
Q: On what direction of the bus was he found about three meters from the bus, was it
at the front or at the back?
A: At the back, sir.  (Emphasis supplied.)
The foregoing testimonies show that the place of the accident and the place where one of
the passengers alighted were both between Bunkhouses 53 and 54, hence the finding of
the Court of Appeals that the bus was at full stop when the victim boarded the same is
correct. They further confirm the conclusion that the victim fell from the platform of the
bus when it suddenly accelerated forward and was run over by the rear right tires of the
vehicle, as shown by the physical evidence on where he was thereafter found in relation to
the bus when it stopped. Under such circumstances, it cannot be said that the deceased
was guilty of negligence.
The contention of petitioners that the driver and the conductor had no knowledge that the
victim would ride on the bus, since the latter had supposedly not manifested his intention
to board the same, does not merit consideration. When the bus is not in motion there is no
necessity for a person who wants to ride the same to signal his intention to board. A public
utility bus, once it stops, is in effect making a continuous offer to bus riders. Hence, it
becomes the duty of the driver and the conductor, every time the bus stops, to do no act
to board the same. The premature acceleration of the bus in this case was a breach of
such duty. 
It is the duty of common carriers of passengers, including common carriers by railroad
train, streetcar, or motorbus, to stop their conveyances a reasonable length of time in
order to afford passengers an opportunity to board and enter, and they are liable for
injuries suffered by boarding passengers resulting from the sudden starting up or jerking
of their conveyances while they are doing so. 
Further, even assuming that the bus was moving, the act of the victim in boarding the
testimony of the aforestated witness for petitioners, Virginia Abalos, th bus had "just
started" and "was still in slow motion" at the point where the victim had boarded and was
on its platform. 
It is not negligence per se, or as a matter of law, for one attempt to board a train or
streetcar which is moving slowly. An ordinarily prudent person would have made the
attempt board the moving conveyance under the same or similar circumstances. The fact
that passengers board and alight from slowly moving vehicle is a matter of common
experience both the driver and conductor in this case could not have been unaware of
such an ordinary practice.
The victim herein, by stepping and standing on the platform of the bus, is already
considered a passenger and is entitled all the rights and protection pertaining to such a
contractual relation. Hence, it has been held that the duty which the carrier passengers
owes to its patrons extends to persons boarding cars as well as to those alighting
therefrom. 
Common carriers, from the nature of their business and reasons of public policy, are
bound to observe extraordinary diligence for the safety of the passengers transported by
the according to all the circumstances of each case. A common carrier is bound to carry
the passengers safely as far as human care and foresight can provide, using the utmost
diligence very cautious persons, with a due regard for all the circumstances. 
It has also been repeatedly held that in an action based on a contract of carriage, the
court need not make an express finding of fault or negligence on the part of the carrier in
order to hold it responsible to pay the damages sought by the passenger. By contract of
carriage, the carrier assumes the express obligation to transport the passenger to his
destination safely and observe extraordinary diligence with a due regard for all the
circumstances, and any injury that might be suffered by the passenger is right away
attributable to the fault or negligence of the carrier. This is an exception to the general
rule that negligence must be proved, and it is therefore incumbent upon the carrier to
prove that it has exercised extraordinary diligence as prescribed in Articles 1733 and 1755
of the Civil Code.  earnings, are to be considered, that is, the total of the earnings less expenses necessary
Moreover, the circumstances under which the driver and the conductor failed to bring the
gravely injured victim immediately to the hospital for medical treatment is a patent and
incontrovertible proof of their negligence. It defies understanding and can even be
stigmatized as callous indifference. The evidence shows that after the accident the bus
could have forthwith turned at Bunk 56 and thence to the hospital, but its driver instead
opted to first proceed to Bunk 70 to allow a passenger to alight and to deliver a
refrigerator, despite the serious condition of the victim. The vacuous reason given by
petitioners that it was the wife of the deceased who caused the delay was tersely and
correctly confuted by respondent court:
... The pretension of the appellees that the delay was due to the fact that they had to
wait for about twenty minutes for Inocencia Cudiamat to get dressed deserves scant
consideration. It is rather scandalous and deplorable for a wife whose husband is at the
verge of dying to have the luxury of dressing herself up for about twenty minutes
before attending to help her distressed and helpless husband.  SO ORDERED
Further, it cannot be said that the main intention of petitioner Lardizabal in going to Bunk
70 was to inform the victim's family of the mishap, since it was not said bus driver nor the
conductor but the companion of the victim who informed his family thereof. In fact, it was
only after the refrigerator was unloaded that one of the passengers thought of sending
somebody to the house of the victim, as shown by the testimony of Virginia Abalos again,
to wit:
Q: Why, what happened to your refrigerator at that particular time?
A: I asked them to bring it down because that is the nearest place to our house and
when I went down and asked somebody to bring down the refrigerator, I also asked
somebody to call the family of Mr. Cudiamat.
COURT:
Q: Why did you ask somebody to call the family of Mr. Cudiamat?
A: Because Mr. Cudiamat met an accident, so I ask somebody to call for the family of
Mr. Cudiamat.
Q: But nobody ask(ed) you to call for the family of Mr. Cudiamat?
A: No sir.
With respect to the award of damages, an oversight was, however, committed by
respondent Court of Appeals in computing the actual damages based on the gross income
of the victim. The rule is that the amount recoverable by the heirs of a victim of a tort is
not the loss of the entire earnings, but rather the loss of that portion of the earnings which
the beneficiary would have received. In other words, only net earnings, not gross
in the creation of such earnings or income and minus living and other incidental expenses. 
We are of the opinion that the deductible living and other expense of the deceased may
fairly and reasonably be fixed at P500.00 a month or P6,000.00 a year. In adjudicating the
actual or compensatory damages, respondent court found that the deceased was 48 years
old, in good health with a remaining productive life expectancy of 12 years, and then
earning P24,000.00 a year. Using the gross annual income as the basis, and multiplying
the same by 12 years, it accordingly awarded P288,000. Applying the aforestated rule on
computation based on the net earnings, said award must be, as it hereby is, rectified and
reduced to P216,000.00. However, in accordance with prevailing jurisprudence, the death
indemnity is hereby increased to P50,000.00. 
WHEREFORE, subject to the above modifications, the challenged judgment and resolution
of respondent Court of Appeals are hereby AFFIRMED in all other respects.
G.R. No. L-20761             July 27, 1966
LA MALLORCA, petitioner,
vs.
HONORABLE COURT OF APPEALS, MARIANO BELTRAN, ET AL., respondents.
G. E. Yabut, R. Monterey and M.C. Lagman for petitioner.
Ahmed Garcia for respondents.
BARRERA, J.:
La Mallorca seeks the review of the decision of the Court of Appeals in CA-G.R. No. 23267-
R, holding it liable for quasi-delict and ordering it to pay to respondents Mariano Beltran,
et al., P6,000.00 for the death of his minor daughter Raquel Beltran, plus P400.00 as
actual damages.
The facts of the case as found by the Court of Appeals, briefly are:
On December 20, 1953, at about noontime, plaintiffs, husband and wife, together with
their minor daughters, namely, Milagros, 13 years old, Raquel, about 4½ years old, and
Fe, over 2 years old, boarded the Pambusco Bus No. 352, bearing plate TPU No. 757
(1953 Pampanga), owned and operated by the defendant, at San Fernando, Pampanga,
bound for Anao, Mexico, Pampanga. At the time, they were carrying with them four
pieces of baggages containing their personal belonging. The conductor of the bus, who
happened to be a half-brother of plaintiff Mariano Beltran, issued three tickets (Exhs. A,
B, & C) covering the full fares of the plaintiff and their eldest child, Milagros. No fare
was charged on Raquel and Fe, since both were below the height at which fare is
charged in accordance with the appellant's rules and regulations.
After about an hour's trip, the bus reached Anao whereat it stopped to allow the
passengers bound therefor, among whom were the plaintiffs and their children to get
off. With respect to the group of the plaintiffs, Mariano Beltran, then carrying some of
their baggages, was the first to get down the bus, followed by his wife and his children.
Mariano led his companions to a shaded spot on the left pedestrians side of the road
about four or five meters away from the vehicle. Afterwards, he returned to the bus in
controversy to get his other bayong, which he had left behind, but in so doing, his
daughter Raquel followed him, unnoticed by her father. While said Mariano Beltran was
on the running board of the bus waiting for the conductor to hand him
his bayong which he left under one of its seats near the door, the bus, whose motor
was not shut off while unloading, suddenly started moving forward, evidently to resume
its trip, notwithstanding the fact that the conductor has not given the driver the
customary signal to start, since said conductor was still attending to the baggage left
behind by Mariano Beltran. Incidentally, when the bus was again placed into a complete
stop, it had travelled about ten meters from the point where the plaintiffs had gotten
off.
Sensing that the bus was again in motion, Mariano Beltran immediately jumped from
the running board without getting his bayong from the conductor. He landed on the
side of the road almost in front of the shaded place where he left his wife and children.
At that precise time, he saw people beginning to gather around the body of a child lying
prostrate on the ground, her skull crushed, and without life. The child was none other
than his daughter Raquel, who was run over by the bus in which she rode earlier
together with her parents.
For the death of their said child, the plaintiffs commenced the present suit against the
defendant seeking to recover from the latter an aggregate amount of P16,000 to cover
moral damages and actual damages sustained as a result thereof and attorney's fees.
After trial on the merits, the court below rendered the judgment in question.
On the basis of these facts, the trial court found defendant liable for breach of contract of
carriage and sentenced it to pay P3,000.00 for the death of the child and P400.00 as
compensatory damages representing burial expenses and costs.
On appeal to the Court of Appeals, La Mallorca claimed that there could not be a breach of
contract in the case, for the reason that when the child met her death, she was no longer
a passenger of the bus involved in the incident and, therefore, the contract of carriage had
already terminated. Although the Court of Appeals sustained this theory, it nevertheless
found the defendant-appellant guilty of quasi-delict and held the latter liable for damages,
for the negligence of its driver, in accordance with Article 2180 of the Civil Code. And, the
Court of Appeals did not only find the petitioner liable, but increased the damages
awarded the plaintiffs-appellees to P6,000.00, instead of P3,000.00 granted by the trial
court.
In its brief before us, La Mallorca contends that the Court of Appeals erred (1) in holding it
liable for quasi-delict, considering that respondents complaint was one for breach of
contract, and (2) in raising the award of damages from P3,000.00 to P6,000.00 although
respondents did not appeal from the decision of the lower court.
Under the facts as found by the Court of Appeals, we have to sustain the judgement
holding petitioner liable for damages for the death of the child, Raquel Beltran. It may be
pointed out that although it is true that respondent Mariano Beltran, his wife, and their
children (including the deceased child) had alighted from the bus at a place designated for
disembarking or unloading of passengers, it was also established that the father had to
return to the vehicle (which was still at a stop) to get one of his bags or bayong that was
left under one of the seats of the bus. There can be no controversy that as far as the
father is concerned, when he returned to the bus for his bayong which was not unloaded,
the relation of passenger and carrier between him and the petitioner remained subsisting.
For, the relation of carrier and passenger does not necessarily cease where the latter, after
alighting from the car, aids the carrier's servant or employee in removing his baggage
from the car. The issue to be determined here is whether as to the child, who was already
led by the father to a place about 5 meters away from the bus, the liability of the carrier
for her safety under the contract of carriage also persisted.
It has been recognized as a rule that the relation of carrier and passenger does not cease
at the moment the passenger alights from the carrier's vehicle at a place selected by the
carrier at the point of destination, but continues until the passenger has had a reasonable
time or a reasonable opportunity to leave the carrier's premises. And, what is a reasonable
time or a reasonable delay within this rule is to be determined from all the circumstances.
Thus, a person who, after alighting from a train, walks along the station platform is
considered still a passenger. So also, where a passenger has alighted at his destination
and is proceeding by the usual way to leave the company's premises, but before actually
doing so is halted by the report that his brother, a fellow passenger, has been shot, and
he in good faith and without intent of engaging in the difficulty, returns to relieve his
brother, he is deemed reasonably and necessarily delayed and thus continues to be a
passenger entitled as such to the protection of the railroad and company and its agents.
In the present case, the father returned to the bus to get one of his baggages which was
not unloaded when they alighted from the bus. Raquel, the child that she was, must have
followed the father. However, although the father was still on the running board of the bus
awaiting for the conductor to hand him the bag or bayong, the bus started to run, so that
even he (the father) had to jump down from the moving vehicle. It was at this instance
that the child, who must be near the bus, was run over and killed. In the circumstances, it
cannot be claimed that the carrier's agent had exercised the "utmost diligence" of a "very
cautions person" required by Article 1755 of the Civil Code to be observed by a common
carrier in the discharge of its obligation to transport safely its passengers. In the first
place, the driver, although stopping the bus, nevertheless did not put off the engine.
Secondly, he started to run the bus even before the bus conductor gave him the signal to
go and while the latter was still unloading part of the baggages of the passengers Mariano
Beltran and family. The presence of said passengers near the bus was not unreasonable
and they are, therefore, to be considered still as passengers of the carrier, entitled to the
protection under their contract of carriage.
But even assuming arguendo that the contract of carriage has already terminated, herein
petitioner can be held liable for the negligence of its driver, as ruled by the Court of
Appeals, pursuant to Article 2180 of the Civil Code. Paragraph 7 of the complaint, which
reads —
That aside from the aforesaid breach of contract, the death of Raquel Beltran, plaintiffs'
daughter, was caused by the negligence and want of exercise of the utmost diligence of
a very cautious person on the part of the defendants and their agent, necessary to
transport plaintiffs and their daughter safely as far as human care and foresight can
provide in the operation of their vehicle.
is clearly an allegation for quasi-delict. The inclusion of this averment for quasi-delict,
while incompatible with the other claim under the contract of carriage, is permissible under
Section 2 of Rule 8 of the New Rules of Court, which allows a plaintiff to allege causes of
action in the alternative, be they compatible with each other or not, to the end that the
real matter in controversy may be resolved and determined.
The plaintiffs sufficiently pleaded the culpa or negligence upon which the claim was
predicated when it was alleged in the complaint that "the death of Raquel Beltran,
plaintiffs' daughter, was caused by the negligence and want of exercise of the utmost
diligence of a very cautious person on the part of the defendants and their agent." This
allegation was also proved when it was established during the trial that the driver, even
before receiving the proper signal from the conductor, and while there were still persons
on the running board of the bus and near it, started to run off the vehicle. The
presentation of proof of the negligence of its employee gave rise to the presumption that
the defendant employer did not exercise the diligence of a good father of the family in the
selection and supervision of its employees. And this presumption, as the Court of Appeals
found, petitioner had failed to overcome. Consequently, petitioner must be adjudged
peculiarily liable for the death of the child Raquel Beltran.
The increase of the award of damages from P3,000.00 to P6,000.00 by the Court of
Appeals, however, cannot be sustained. Generally, the appellate court can only pass upon
and consider questions or issues raised and argued in appellant's brief. Plaintiffs did not
appeal from that portion of the judgment of the trial court awarding them on P3,000.00
damages for the death of their daughter. Neither does it appear that, as appellees in the
Court of Appeals, plaintiffs have pointed out in their brief the inadequacy of the award, or
that the inclusion of the figure P3,000.00 was merely a clerical error, in order that the
matter may be treated as an exception to the general rule. Herein petitioner's contention,
therefore, that the Court of Appeals committed error in raising the amount of the award
for damages is, evidently, meritorious.
Wherefore, the decision of the Court of Appeals is hereby modified by sentencing, the
petitioner to pay to the respondents Mariano Beltran, et al., the sum of P3,000.00 for the
death of the child, Raquel Beltran, and the amount of P400.00 as actual damages. No
costs in this instance. So ordered.
[G.R. No. 29721. March 27, 1929.]
AMANDO MIRASOL, Plaintiff-Appellant, v. THE ROBERT DOLLAR CO., Defendant-
Appellant.
Vicente Hilado, for Plaintiff-Appellant.
J. A. Wolfson, for Defendant-Appellant.
SYLLABUS
1. WHEN SHIPPER IS NOT BOUND. — Where it appears that a bill of lading was issued to a
shipper containing a clause limiting the carrier’s liability, printed in fine letters on the back
of the bill of lading, which he did not sign and of which he was not advised, in an action for
damages, the shipper is not bound by the clause which limits the carrier’s liability.
2. WHEN BURDEN OF PROOF IS SHIFTED. — Shippers who are forced to ship goods on an
ocean liner, have some legal rights, and when goods are delivered on board ship in good
order and condition, and the shipowner delivers them to the shipper in bad order and
condition, in an action for damages, the burden of proof is then shifted, and it devolves
upon the shipowner to both allege and prove that the goods were damaged by reason of
some act which legally exempts him from liability.
3. REASON FOR RULE. — As to when and how goods were damaged in transit is a matter
peculiarly within the knowledge of the shipowner and his employees, and to require the
plaintiff to prove as to when and how the damage was done would force him to rely upon
the employees of the defendant’s ship which in legal effect would be to say that he cannot
recover damages for any reason.
STATEMENT
After the promulgation of the decision rendered by the Second Division on February 13,
1929, the defendant filed a motion to have the case heard and decided in banc, and
inasmuch as the legal questions involved are important to the shipping interests, the court
thought it best to do so.
After the formal pleas, plaintiff alleges that he is the owner and consignee of two cases of
books shipped in good order and condition at New York, U. S. A., on board the defendant’s
steamship President Garfield, for transport and delivery to the plaintiff in the City of
Manila, all freight charges paid. That the two cases arrived in Manila on September 1,
1927, in bad order and damaged condition, resulting in the total loss of one case and a
partial loss of the other. That the loss in one case is P1,630, and the other P700, for which
he filed his claims, and defendant has refused and neglected to pay, giving as its reason
that the damage in question "was caused by sea water." That plaintiff never entered into
any contract with the defendant limiting defendant’s liability as a common carrier, and
when he wrote the letter of September 3, 1927, he had not then ascertained the contents
of the damaged case, and could not determine their value. That he never intended to
ratify or confirm any agreement to limit the liability of the defendant. That on September
9, 1927, when the other case was found, plaintiff filed a claim for the real damage of the
books therein named in the sum of $375.
Plaintiff prays for corresponding judgment, with legal interest from the filing of the
complaint and costs.
For answer the defendant made a general and specific denial, and as a separate and
special defense alleges that the steamship President Garfield at all the times alleged was
in all respects seaworthy and properly manned, equipped and supplied, and fit for the
voyage. That the damage to plaintiff’s merchandise, if any, was not caused through the
negligence of the vessel, its master, agent, officers, crew, tackle or appurtenances, nor by
reason of the vessel being unseaworthy or improperly manned, "but that such damage, if
any, resulted from faults or errors in navigation or in the management of said vessel." As
a second separate and special defense, defendant alleges that in the bill of lading issued
by the defendant to plaintiff, it was agreed in writing that defendant should not be "held
liable for any loss of, or damage to, any of said merchandise resulting from any of the
following causes, to wit: Acts of God, perils of the sea or other waters," and that plaintiff’s
damage, if any, was caused by "Acts of God" or "perils of the sea." As a third special
defense, defendant quoted clause 13 of the bill of lading, in which it is stated that in no
case shall it be held liable "for or in respect to said merchandise or property beyond the
sum of two hundred and fifty dollars for any piece package or any article not enclosed in a
package, unless a higher value is stated herein and ad valorem freight paid or assessed
thereon," and that there was no other agreement. That on September 3, 1927 the plaintiff
wrote the defendant a letter as follows:
"Therefore, I wish to file claim of damage to the meager maximum value that your bills of
lading will indemnify me, that is $250 as per condition 13."
As a fourth special defense, defendant alleges that the damage, if any, was caused by "sea
water," and that the bill of lading exempts defendant from liability for that cause. That
damage by "sea water" is a shipper’s risk, and that defendant is not liable.
As a result of the trial upon such issues, the lower court rendered judgment for the
plaintiff for P2,080, with legal interest thereon from the date of the final judgment, with
costs, from which both parties appealed, and the plaintiff assigns the following errors:
"I. The lower court erred in holding that plaintiff’s damage on account of the loss of the
damaged books in the partially damaged case can be compensated with an indemnity of
P450 instead of P750 as claimed by plaintiff.
"II. The lower court, consequently, also erred in giving judgment for plaintiff for only
P2,080 instead of P2,380.
"III. The lower court erred in not sentencing defendant to pay legal interest on the amount
of the judgment, at least, from the date of the rendition of said judgment, namely,
January 30, 1928."
The defendant assigns the following errors:
"I. The lower court erred in failing to recognize the validity of the limited liability clause of
the bill of lading, Exhibit 2.
"II. The lower court erred in holding defendant liable in any amount and in failing to hold,
after its finding as a fact that the damage was caused by sea water, that the defendant is
not liable for such damage by sea water.
"III The lower court erred in awarding damages in favor of plaintiff and against defendant
for P2,080 or in any other amount, and in admitting, over objection, Exhibits G, H, I and
J."
DECISION
JOHNS, J.:
Plaintiff’s contention that he is entitled to P700 for his Encyclopedia Britannica is not
tenable. The evidence shows that with the P400 which the court allowed, he could buy a
new set which would contain all of the material and subject matter of the one which he
lost. Plaintiff’s third assignment of error is well taken, as under all of the authorities, he is
entitled to legal interest from the date of his judgment rendered in the lower court and not
the date when it becomes final. The lower court found that plaintiff’s damage was P2,080,
and that finding is sustained by the evidence. There was a total loss of one case and a
partial loss of the other, and in the very nature of things, plaintiff could not prove his loss
in any other way or manner than he did prove i, and the trial court who heard him testify
must have been convinced of the truth of his testimony.
There is no claim or pretense that the plaintiff signed the bill of lading or that he knew of
its contents at the time it was issued. In that situation he was not legally bound by the
clause which purports to limit defendant’s liability. That question was squarely met and
decided by this court in banc in Juan Ysmael & Co., v. Gabino Barretto & Co. (51 Phil., 90;
see numerous authorities there cited).
Among such authorities is the case of The Kensington decided by the Supreme Court of
the United States January 6, 1902 (46 Law. ed., 190), in which the opinion was written by
the late Chief Justice White, the syllabus of which is as follows:
"1. Restrictions of the liability of a steamship company for its own negligence or failure of
duty toward a passenger, being against the public policy enforced by the courts of the
United States, will not be upheld, though the ticket was issued and accepted in a foreign
country and contained a condition making it subject to the law thereof, which sustain such
stipulations.
"2. A stipulation in a steamship passenger’s ticket, which compels him to value his
baggage, at a certain sum, far less than it is worth, or, in order to have a higher value put
upon it, to subject it to the provisions of the Harter Act, by which the carrier would be
exempted from all liability therefor from errors in navigation or management of the vessel
or other negligence, is unreasonable and in conflict with public policy.
"3. An arbitrary limitation of 250 francs for the baggage of any steamship passenger,
unaccompanied by any right to increase the amount by adequate and reasonable
proportional payment, is void as against public policy."
Both the facts upon which it is based and the legal principles involved are square in point
in this case.
The defendant having received the two boxes in good condition, its legal duty was to
deliver them to the plaintiff in the same condition in which it received them. From the time
of their delivery to the defendant in New York until they were delivered to the plaintiff in
Manila, the boxes were under the control and supervision of the defendant and beyond the
control of the plaintiff. The defendant having admitted that the boxes were damaged while
in transit and in its possession, the burden of proof then shifted, and it devolved upon the
defendant to both allege and prove that the damage was caused by reason of some fact
which exempted it from liability. As to how the boxes were damaged, when or where, was
a matter peculiarly and exclusively within the knowledge of the defendant, and in the very
nature of things could not be in the knowledge of the plaintiff. To require the plaintiff to
prove as to when and how the damage was caused would force him to call and rely upon
the employees of the defendant’s ship, which in legal effect would be to say that he could
not recover any damage for any reason. That is not the law.
Shippers who are forced to ship goods on an ocean liner or any other ship have some legal
rights, and when goods are delivered on board ship in good order and condition, and the
shipowner delivers them to the shipper in bad order and condition, it then devolves upon
the shipowner to both allege and prove that the goods were damaged by reason of some
fact which legally exempts him from liability; otherwise, the shipper would be left without
any redress, no matter what may have caused the damage.
The lower court in its opinion says:
"The defendant has not even attempted to prove that the two cases were wet with sea
water by fortuitous event, force majeure or nature and defect of the things themselves.
Consequently, it must be presumed that it was by causes entirely distinct and in no
manner imputable to the plaintiff, and of which the steamer President Garfield or any of its
crew could not have been entirely unaware."
And the evidence for the defendant shows that the damage was largely caused by "sea
water," from which it contends that it is exempt under the provisions of its bill of lading
and the provisions of article 361 of the Code of Commerce, which is as follows:
"Merchandise shall be transported at the risk and venture of the shipper, if the contrary
was not expressly stipulated.
"Therefore, all damages and impairment suffered by the goods during the transportation,
by reason of accident, force majeure, or by virtue of the nature or defect of the articles,
shall be for the account and risk of the shipper.
"The proof of these accidents is incumbent on the carrier."
In the final analysis, the cases were received by the defendant in New York in good order
and condition, and when they arrived in Manila, they were in bad condition, and one was a
total loss. The fact that the cases were damaged by "sea water," standing alone and within
itself, is not evidence that they were damaged by force majeure or for a cause beyond the
defendant’s control. The words "perils of the sea," as stated in defendant’s brief apply to
"all kinds of marine casualties, such as shipwreck, foundering, stranding," and among
other things, it is said: "Tempest rocks, shoals, icebergs and other obstacles are within the
expression," and "where the peril is the proximate cause of the loss, the shipowner is
excused." "Something fortuitous and out of the ordinary course is involved in both words
’peril’ or ’accident.’" Defendant also cites and relies on the case of Government of the
Philippine Islands v. Ynchausti & Company (40 Phil., 219), but it appears from a reading of
that case that the facts are very different and, hence, it is not in point. In the instant case,
there is no claim or pretense that the two cases were not in good order when received on
board the ship, and it is admitted that they were in bad order on their arrival at Manila.
Hence, they must have been damaged in transit. In the very nature of things, if they were
damaged by reason of a tempest, rocks, icebergs, foundering, stranding or the perils of
the sea, that would be a matter exclusively within the knowledge of the officers of
defendant’s ship, and in the very nature of things would not be within plaintiff’s
knowledge, and upon all of such questions, there is a failure of proof.
The judgment of the lower court will be modified, so as to give the plaintiff legal interest
on the amount of his judgment from the date of its rendition in the lower court, and in all
other respects affirmed, with costs. So ordered.
[G.R. No. 114167. July 12, 1995.]
COASTWISE LIGHTERAGE CORPORATION, Petitioner, v. COURT OF APPEALS and
the PHILIPPINE GENERAL INSURANCE COMPANY, Respondents.
David & Associates Law Offices for Petitioner.
Fajardo Law Offices for Private Respondent.
SYLLABUS

1. CIVIL LAW; SPECIAL CONTRACTS; COMMON CARRIER; KINDS OF CHARTER PARTIES;
CONTRACT OF AFFREIGHTMENT; DISTINGUISHED FROM BAREBOAT OR DEMISE. — The
distinction between the two kinds of charter parties (i.e. bareboat or demise and contract
of affreightment) is more clearly set out in the case of Puromines, Inc. v. Court of Appeals,
wherein we ruled: "Under the demise or bareboat charter of the vessel, the charterer will
generally be regarded as the owner for the voyage or service stipulated. The charterer
mans the vessel with his own people and becomes the owner pro hac vice, subject to
liability to others for damages caused by negligence. To create a demise, the owner of a
vessel must completely and exclusively relinquish possession, command and navigation
thereof to the charterer, anything short of such a complete transfer is a contract of
affreightment (time or voyage charter party) or not a charter party at all. On the other
hand a contract of affreightment is one in which the owner of the vessel leases part or all
of its space to haul goods for others. It is a contract for special service to be rendered by
the owner of the vessel and under such contract the general owner retains the possession,
command and navigation of the ship, the charterer or freighter merely having use of the
space in the vessel in return for his payment of the charter hire. . . An owner who retains
possession of the ship though the hold is the property of the charterer, remains liable as
carrier and must answer for any breach of duty as to the care, loading and unloading of
the cargo. . ." Although a charter party may transform a common carrier into a private
one, the same however is not true in a contract of affreightment on account of the
aforementioned distinctions between the two.
2. ID.; ID.; ID.; ID.; ID.; LIABLE AS A COMMON CARRIER. — Petitioner admits that the
contract it entered into with the consignee was one of affreightment. We agree. Pag-asa
Sales, Inc. only leased three of petitioner’s vessels, in order to carry cargo from one point
to another, but the possession, command and navigation of the vessels remained with
petitioner Coastwise Lighterage. Pursuant therefore to the ruling in the aforecited
Puromines case, Coastwise Lighterage, by the contract of affreightment, was not
converted into a private carrier, but remained a common carrier and was still liable as
such. The law and jurisprudence on common carriers both hold that the mere proof of
delivery of goods in good order to a carrier and the subsequent arrival of the same goods
at the place of destination in bad order makes for a prima facie case against the carrier. It
follows then that the presumption of negligence that attaches to common carriers, once
the goods it transports are lost, destroyed or deteriorated, applies to the petitioner. This
presumption, which is overcome only by proof of the exercise of extraordinary diligence,
remained unrebutted in this case.
3. ID.; ID.; ID.; ID.; ID.; MUST ALSO EXERCISE EXTRAORDINARY DILIGENCE BY
PLACING A PERSON WITH NAVIGATIONAL SKILLS. — Jesus R. Constantino, the patron of
the vessel "Coastwise 9" admitted that he was not licensed. The Code of Commerce, which
subsidiarily governs common carriers (which are primarily governed by the provisions of
the Civil Code). Clearly, petitioner Coastwise Lighterage’s embarking on a voyage with an
unlicensed patron violates this rule. It cannot safely claim to have exercised extraordinary
diligence, by placing a person whose navigational skills are questionable, at the helm of
the vessel which eventually met the fateful accident. It may also logically, follow that a
person without license to navigate, lacks not just the skill to do so, but also the utmost
familiarity with the usual and safe routes taken by seasoned and legally authorized ones.
Had the patron been licensed, he could be presumed to have both the skill and the
knowledge that would have prevented the vessel’s hitting the sunken derelict ship that lay
on their way to Pier 18. As a common carrier, petitioner is liable for breach of the contract
of carriage, having failed to overcome the presumption of negligence with the loss and
destruction of goods it transported, by proof of its exercise of extraordinary diligence.
4. ID.; DAMAGES; INSURANCE COMPANY SHALL BE SUBROGATED TO THE RIGHTS OF
THE INSURED AGAINST THE WRONGDOER. — On the issue of subrogation, which
petitioner contends as inapplicable in this case, we once more rule against the petitioner.
We have already found petitioner liable for breach of the contract of carriage it entered
into with Pag-asa Sales, Inc. However, for the damage sustained by the loss of the cargo
which petitioner-carrier was transporting, it was not the carrier which paid the value
thereof to Pag-asa Sales, Inc. but the latter’s insurer, herein private respondent PhilGen.
Article 2207 of the Civil Code is explicit on this point. Containing the equitable principle of
subrogation has been applied in a long line of cases including Compania Maritima v.
Insurance Company of North America; Fireman’s Fund Insurance Company v. Jamilla &
Company, Inc., and Pan Malayan Insurance Corporation v. Court of Appeals, wherein this
Court explained: "Article 2207 of the Civil Code is founded on the well-settled principle of
subrogation. If the insured property is destroyed or damaged through the fault or
negligence of a party other than the assured, then the insurer, upon payment to the
assured will be subrogated to the rights of the assured to recover from the wrongdoer to
the extent that the insurer has been obligated to pay. Payment by the insurer to the
assured operated as an equitable assignment to the former of all remedies which the latter
may have against the third party whose negligence or wrongful act caused the loss. The
right of subrogation is not dependent upon, nor does it grow out of, any privity of contract
or upon written assignment of claim. It accrues simply upon payment of the insurance
claim by the insurer."
DECISION
FRANCISCO, R., J.:
This is a petition for review of a Decision rendered by the Court of Appeals, dated
December 17, 1993, affirming Branch 35 of the Regional Trial Court Manila in holding that
herein petitioner is liable to pay herein private respondent the amount of P700,000.00 plus
legal interest thereon, another sum of P100,000.00 as attorney’s fees and the cost of the
suit.
The factual background of this case is as follows:
Pag-asa Sales Inc. entered into a contract to transport molasses from the province of
Negros to Manila with Coastwise Lighterage Corporation (Coastwise for brevity), using the
latter’s dumb barges. The barges were towed in tandem by the tugboat MT Marica, which
is likewise owned by Coastwise.
Upon reaching Manila Bay, while approaching Pier 18, one of the barges, "Coastwise 9",
struck an unknown sunken object. The forward buoyancy compartment was damaged, and
water gushed in through a hole "two inches wide and twenty-two inches long." As a
consequence, the molasses at the cargo tanks were contaminated and rendered unfit for
the use it was intended. This prompted the consignee, Pag-asa Sales, Inc. to reject the
shipment of molasses as a total loss. Thereafter, Pag-asa Sales, Inc. filed a formal claim
with the insurer of its lost cargo, herein private respondent, Philippine General Insurance
Company (PhilGen, for short) and against the carrier, herein petitioner, Coastwise
Lighterage. Coastwise Lighterage denied the claim and it was PhilGen which. paid the
consignee, Pag-asa Sales, Inc., the amount of P700,000.00 representing the value of the
damaged cargo of molasses.
In turn, PhilGen then filed an action against Coastwise Lighterage before the Regional Trial
Court of Manila, seeking to recover the amount of P700,000.00 which it paid to Pag-asa
Sales, Inc. for the latter’s lost cargo PhilGen now claims to be subrogated to all the
contractual rights and claims which the consignee may have against the carrier, which is
presumed to have violated the contract of carriage.
The RTC awarded the amount prayed for by PhilGen. On Coastwise Lighterage’s appeal to
the Court of Appeals, the award was affirmed.
Hence, this petition.
There are two main issues to be resolved herein. First, whether or not petitioner Coastwise
Lighterage was transformed into a private carrier, by virtue of the contract of
affreightment which it entered into with the consignee, Pag-asa Sales, Inc. Corollarily, if it
were in fact transformed into a private carrier, did it exercise the ordinary diligence to
which a private carrier is in turn bound? Second, whether or not the insurer was
subrogated into the rights of the consignee against the carrier, upon payment by the
insurer of the value of the consignee’s goods lost while on board one of the Oriental to
Manila and refers to this contract as a carrier’s vessels.
On the first issue, petitioner contends that the RTC and the Court of Appeals erred in
finding that it was a common carrier. It stresses the fact it contracted with Pag-asa Sales,
Inc. to transport the shipment of molasses from Negros Oriental to Manila and refers to
this contract as a "charter agreement." It then proceeds to cite the case of Home
Insurance and the Court of Appeals erred in finding that it was a common carrier.
Steamship Agencies, Inc. wherein this Court held: . . . a common carrier undertaking to
carry a special cargo or chartered to a person only becomes a private carrier.
Petitioner’s reliance on the aforementioned case is misplaced. In its entirety, the
conclusions of the court are as follows:
"According, the charter party contract is one of affreightment over the whole vessels,
rather than a demise. As such, the liability of the shipowner for acts or negligence of its
captain and crew, would remain in the absence of stipulation."
The distinction between the two kinds of charter parties (i.e. bareboat or demise and
contract of affreightment) is more clearly set out in the case of Puromines, Inc v. Court of
Appeals, wherein we ruled:
"Under the demise or bareboat charter of the vessel, the charterer will generally be
regarded as the owner for the voyage or service stipulated. The charterer mans the vessel
with his own people and becomes the owner pro hac vice, subject to liability to others for
damages caused by negligence. To create a demise, the owner of a vessel must
completely and exclusively relinquish possession, command and navigation thereof to the
charterer anything short of such a complete transfer is a contract of affreightment (time or
voyage charter party) or not a charter party all.
On the other hand a contract of affreightment is one in which the owner of the vessel
leases part or all of its space to haul goods for others. It is a contract for special service to
be rendered by the owner of the vessel and under such contract the general owner retains
the possession, command and navigation of the ship, the charterer or freighter merely
having use of the space in the vessel in return for his payment or the charter hire . . .
. . . An owner who retains possession of the ship though the hold is the property of the
charterer, remains liable as carrier and must answer for any breach of duty as to the care,
loading and unloading of the cargo . . ."
Although a charter party may transform a common carrier into a private one, the same
however is not true in a contract of affreightment on account of the aforementioned
distinctions between the two.
Petitioner admits that the contract it entered into with the consignee was one of
affreightment. We agree. Pag-asa Sales, Inc. only leased three of petitioner’s vessels, in
order to carry cargo from one point to another, but the possession, command mid
navigation of the vessels remained with petitioner Coastwise Lighterage.
Pursuant therefore to the ruling in the aforecited Puromines case, Coastwise Lighterage,
by the contract of affreightment, was not converted into a private carrier, but remained a
common carrier and was still liable as such.
The law and jurisprudence on common carriers both hold that the mere proof of delivery of
goods in good order to a carrier and the subsequent arrival of the same goods at the place
of destination in bad order makes for a prima facie case against the carrier.
It follows then that the presumption of negligence that attaches to common carriers, once
the goods it is sports are lost, destroyed or deteriorated, applies to the petitioner. This
presumption, which is overcome only by proof of the exercise of extraordinary diligence,
remained unrebutted in this case.
The records show that time damage to the barge which carried the cargo of molasses was
caused by its hitting an unknown sunken object as it was heading for Pier 18. The object
turned out to be a submerged derelict vessel. Petitioner contends that this navigational
hazard was the efficient cause of the accident. Further, it asserts that the fact that the
Philippine Coastguard "has not exerted any effort to prepare a chart to indicate the
location of sunken derelicts within Manila North Harbor to avoid navigational accidents"
effectively contributed to the happening of this mishap. Thus, being unaware of the hidden
danger that lies in its path, it became impossible for the petitioner to avoid the same.
Nothing could have prevented the event, making it beyond the pale of even the exercise of
extraordinary diligence.

However, petitioner’s assertion is belied by the evidence on record where it appeared that
far from having rendered service with the greatest skill and outmost foresight, and being
free from fault, the carrier was culpably remiss in the observance of its duties.
Jesus R. Constantino, the patron of the vessel "Coastwise 9" admitted that he was not
licensed. The Code of Commerce, which subsidiarily governs common carriers (which are
primarily governed by the provisions of the Civil Code) provides:
"Article 609. — Captains, masters, or patrons of vessels must be Filipinos, have legal
capacity to contract in accordance with this code, and prove the skill capacity and
qualifications necessary to command and direct the vessel, as established by marine and
navigation laws, ordinances or regulations, and must not be disqualified according to the
same for the discharge of the duties of the position . . ."
Clearly, petitioner Coastwise Lighterage’s embarking on a voyage with an unlicensed
patron violates this rule. It cannot safely claim to have exercised extraordinary diligence,
by placing a person whose navigational skills are questionable, at the helm of the vessel
which eventually met the fateful accident. It may also logically, follow that a person
without license to navigate, lacks not just the skill to do so, but also the utmost familiarity
with the usual and safe routes taken by seasoned and legally authorized ones. Had the
patron been licensed he could be presumed to have both the skill and the knowledge that
would have prevented the vessel’s hitting the sunken derelict ship that lay on their way to
Pier 18.chanroblesvirtuallawlibrary
As a common carrier, petitioner is liable for breach of the contract of carriage, having
failed to overcome the presumption of negligence with the loss and destruction of goods it
transported, by proof of its exercise of extraordinary diligence.
On the issue of subrogation, which petitioner contends as inapplicable in this case, we
once more rule against the petitioner. We have already found petitioner liable for breach of
the contract of carriage it entered into with Pag-asa Sales, Inc. However, for the damage
sustained by the loss of the cargo which petitioner-carrier was transporting, it was not the
carrier which paid the value thereof to Pag-asa Sales, Inc. but the latter’s insurer, herein
private respondent PhilGen.
Article 2207 of the Civil Code is explicit on this point:
"Art. 2207. If the plaintiff’s property has been insured, and he has received indemnity
from the insurance company for the injury or loses arising out of the wrong or breach of
contract complained of the insurance company shall be subrogated to the rights of the
insured against the wrongdoer or the person who violated the contract . . ."
This legal provision containing the equitable principle of subrogation has been applied in a
long line of cases including Compania Maritima v. Insurance Company of North America;
Firesman’s Fund Insurance Company v. Jamilla & Company, Inc., and Pan Malayan
Insurance Corporation v. Court of Appeals, wherein this Court explained:
"Article 2207 of the Civil Code is founded on the well-settled principle of subrogation. If
the insured property is destroyed or damaged through the fault or negligence of a party
other than the assured, then the insurer, upon payment to the assured will be subrogated
to the rights of the assured to recover from the wrongdoer to the extent that the insurer
has been obligated to pay. Payment by the insurer to the assured operated as an equitable
assignment to the former of all remedies which the latter may have against the third party
whose negligence or wrongful act caused the loss. The right of subrogation is not
dependent upon, nor does it grow out of, any private of contract or upon written
assignment of, claim. It accrues simply upon payment of the insurance claim by the
insurer."
Undoubtedly, upon payment by respondent insurer PhilGen of the amount of P700,000.00
to Pag-asa Sales, Inc., the consignee of the cargo of molasses totally damaged while being
transported by petitioner Coastwise Lighterage, the former was, subrogated into all the
rights which Pag-asa Sales, Inc. may have had against the carrier, herein petitioner
Coastwise Lighterage.
WHEREFORE, premises considered, this petition is DENIED and the appealed decision
affirming the order of Branch 35 of the Regional Trial Court of Manila for petitioner
Coastwise Lighterage to pay respondent Philippine General Insurance Company the
"principal amount of P700,000.00 plus interest thereon at the legal rate computed from
March 29, 1989, the date the complaint was filed until fully paid’ and another sum of
P100,000.00 as attorney’s fees and costs" is likewise hereby AFFIRMED.
SO ORDERED.
G.R. No. L-12191             October 14, 1918
JOSE CANGCO, plaintiff-appellant,
vs.
MANILA RAILROAD CO., defendant-appellee.
Ramon Sotelo for appellant.
Kincaid & Hartigan for appellee.
FISHER, J.:
At the time of the occurrence which gave rise to this litigation the plaintiff, Jose Cangco,
was in the employment of Manila Railroad Company in the capacity of clerk, with a
monthly wage of P25. He lived in the pueblo of San Mateo, in the province of Rizal, which
is located upon the line of the defendant railroad company; and in coming daily by train to
the company's office in the city of Manila where he worked, he used a pass, supplied by
the company, which entitled him to ride upon the company's trains free of charge. Upon
the occasion in question, January 20, 1915, the plaintiff arose from his seat in the second
class-car where he was riding and, making, his exit through the door, took his position
upon the steps of the coach, seizing the upright guardrail with his right hand for support.
On the side of the train where passengers alight at the San Mateo station there is a
cement platform which begins to rise with a moderate gradient some distance away from
the company's office and extends along in front of said office for a distance sufficient to
cover the length of several coaches. As the train slowed down another passenger, named
Emilio Zuñiga, also an employee of the railroad company, got off the same car, alighting
safely at the point where the platform begins to rise from the level of the ground. When
the train had proceeded a little farther the plaintiff Jose Cangco stepped off also, but one
or both of his feet came in contact with a sack of watermelons with the result that his feet
slipped from under him and he fell violently on the platform. His body at once rolled from
the platform and was drawn under the moving car, where his right arm was badly crushed
and lacerated. It appears that after the plaintiff alighted from the train the car moved
forward possibly six meters before it came to a full stop.
The accident occurred between 7 and 8 o'clock on a dark night, and as the railroad station
was lighted dimly by a single light located some distance away, objects on the platform
where the accident occurred were difficult to discern especially to a person emerging from
a lighted car.
The explanation of the presence of a sack of melons on the platform where the plaintiff
alighted is found in the fact that it was the customary season for harvesting these melons
and a large lot had been brought to the station for the shipment to the market. They were
contained in numerous sacks which has been piled on the platform in a row one upon
another. The testimony shows that this row of sacks was so placed of melons and the edge
of platform; and it is clear that the fall of the plaintiff was due to the fact that his foot
alighted upon one of these melons at the moment he stepped upon the platform. His
statement that he failed to see these objects in the darkness is readily to be credited.
The plaintiff was drawn from under the car in an unconscious condition, and it appeared
that the injuries which he had received were very serious. He was therefore brought at
once to a certain hospital in the city of Manila where an examination was made and his
arm was amputated. The result of this operation was unsatisfactory, and the plaintiff was
then carried to another hospital where a second operation was performed and the member
was again amputated higher up near the shoulder. It appears in evidence that the plaintiff
expended the sum of P790.25 in the form of medical and surgical fees and for other
expenses in connection with the process of his curation.
Upon August 31, 1915, he instituted this proceeding in the Court of First Instance of the
city of Manila to recover damages of the defendant company, founding his action upon the
negligence of the servants and employees of the defendant in placing the sacks of melons
upon the platform and leaving them so placed as to be a menace to the security of
passenger alighting from the company's trains. At the hearing in the Court of First
Instance, his Honor, the trial judge, found the facts substantially as above stated, and
drew therefrom his conclusion to the effect that, although negligence was attributable to
the defendant by reason of the fact that the sacks of melons were so placed as to obstruct
passengers passing to and from the cars, nevertheless, the plaintiff himself had failed to
use due caution in alighting from the coach and was therefore precluded form recovering.
Judgment was accordingly entered in favor of the defendant company, and the plaintiff
appealed.
It can not be doubted that the employees of the railroad company were guilty of
negligence in piling these sacks on the platform in the manner above stated; that their
presence caused the plaintiff to fall as he alighted from the train; and that they therefore
constituted an effective legal cause of the injuries sustained by the plaintiff. It necessarily
follows that the defendant company is liable for the damage thereby occasioned unless
recovery is barred by the plaintiff's own contributory negligence. In resolving this problem
it is necessary that each of these conceptions of liability, to-wit, the primary responsibility
of the defendant company and the contributory negligence of the plaintiff should be
separately examined.
It is important to note that the foundation of the legal liability of the defendant is the
contract of carriage, and that the obligation to respond for the damage which plaintiff has
suffered arises, if at all, from the breach of that contract by reason of the failure of
defendant to exercise due care in its performance. That is to say, its liability is direct and
immediate, differing essentially, in legal viewpoint from that presumptive responsibility for
the negligence of its servants, imposed by article 1903 of the Civil Code, which can be
rebutted by proof of the exercise of due care in their selection and supervision. Article
1903 of the Civil Code is not applicable to obligations arising ex contractu, but only to
extra-contractual obligations — or to use the technical form of expression, that article
relates only to culpa aquiliana and not to culpa contractual.
Manresa (vol. 8, p. 67) in his commentaries upon articles 1103 and 1104 of the Civil Code,
clearly points out this distinction, which was also recognized by this Court in its decision in
the case of Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil. rep., 359). In commenting upon
article 1093 Manresa clearly points out the difference between "culpa, substantive and
independent, which of itself constitutes the source of an obligation between persons not
formerly connected by any legal tie" and culpa  considered as an accident in the
performance of an obligation already existing . . . ."
In the Rakes case (supra) the decision of this court was made to rest squarely upon the
proposition that article 1903 of the Civil Code is not applicable to acts of negligence which
constitute the breach of a contract.
Upon this point the Court said:
The acts to which these articles [1902 and 1903 of the Civil Code] are applicable are
understood to be those not growing out of pre-existing duties of the parties to one
another. But where relations already formed give rise to duties, whether springing from
contract or quasi-contract, then breaches of those duties are subject to article 1101,
1103, and 1104 of the same code. (Rakes vs. Atlantic, Gulf and Pacific Co., 7 Phil.
Rep., 359 at 365.)
This distinction is of the utmost importance. The liability, which, under the Spanish law, is,
in certain cases imposed upon employers with respect to damages occasioned by the
negligence of their employees to persons to whom they are not bound by contract, is not
based, as in the English Common Law, upon the principle of respondeat superior —  if it
were, the master would be liable in every case and unconditionally — but upon the
principle announced in article 1902 of the Civil Code, which imposes upon all persons who
by their fault or negligence, do injury to another, the obligation of making good the
damage caused. One who places a powerful automobile in the hands of a servant whom he
knows to be ignorant of the method of managing such a vehicle, is himself guilty of an act
of negligence which makes him liable for all the consequences of his imprudence. The
obligation to make good the damage arises at the very instant that the unskillful servant,
while acting within the scope of his employment causes the injury. The liability of the
master is personal and direct. But, if the master has not been guilty of any negligence
whatever in the selection and direction of the servant, he is not liable for the acts of the
latter, whatever done within the scope of his employment or not, if the damage done by
the servant does not amount to a breach of the contract between the master and the
person injured.
It is not accurate to say that proof of diligence and care in the selection and control of the
servant relieves the master from liability for the latter's acts — on the contrary, that proof
shows that the responsibility has never existed. As Manresa says (vol. 8, p. 68) the
liability arising from extra-contractual culpa is always based upon a voluntary act or
omission which, without willful intent, but by mere negligence or inattention, has caused
damage to another. A master who exercises all possible care in the selection of his
servant, taking into consideration the qualifications they should possess for the discharge
of the duties which it is his purpose to confide to them, and directs them with equal
diligence, thereby performs his duty to third persons to whom he is bound by no
contractual ties, and he incurs no liability whatever if, by reason of the negligence of his
servants, even within the scope of their employment, such third person suffer damage.
True it is that under article 1903 of the Civil Code the law creates a presumption that he
has been negligent in the selection or direction of his servant, but the presumption is
rebuttable and yield to proof of due care and diligence in this respect.
The supreme court of Porto Rico, in interpreting identical provisions, as found in the Porto
Rico Code, has held that these articles are applicable to cases of extra-
contractual culpa exclusively. (Carmona vs. Cuesta, 20 Porto Rico Reports, 215.)
This distinction was again made patent by this Court in its decision in the case of
Bahia vs. Litonjua and Leynes, (30 Phil. rep., 624), which was an action brought upon the
theory of the extra-contractual liability of the defendant to respond for the damage caused
by the carelessness of his employee while acting within the scope of his employment. The
Court, after citing the last paragraph of article 1903 of the Civil Code, said:
From this article two things are apparent: (1) That when an injury is caused by the
negligence of a servant or employee there instantly arises a presumption of law that
there was negligence on the part of the master or employer either in selection of the
servant or employee, or in supervision over him after the selection, or both; and (2)
that that presumption is  juris tantum and not  juris et de jure, and consequently, may
be rebutted. It follows necessarily that if the employer shows to the satisfaction of the
court that in selection and supervision he has exercised the care and diligence of a
good father of a family, the presumption is overcome and he is relieved from liability.
This theory bases the responsibility of the master ultimately on his own negligence and
not on that of his servant. This is the notable peculiarity of the Spanish law of
negligence. It is, of course, in striking contrast to the American doctrine that, in
relations with strangers, the negligence of the servant in conclusively the negligence of
the master.
The opinion there expressed by this Court, to the effect that in case of extra-
contractual culpa based upon negligence, it is necessary that there shall have been some
fault attributable to the defendant personally, and that the last paragraph of article 1903
merely establishes a rebuttable presumption, is in complete accord with the authoritative
opinion of Manresa, who says (vol. 12, p. 611) that the liability created by article 1903 is
imposed by reason of the breach of the duties inherent in the special relations of authority
or superiority existing between the person called upon to repair the damage and the one
who, by his act or omission, was the cause of it.
On the other hand, the liability of masters and employers for the negligent acts or
omissions of their servants or agents, when such acts or omissions cause damages which
amount to the breach of a contact, is not based upon a mere presumption of the master's
negligence in their selection or control, and proof of exercise of the utmost diligence and
care in this regard does not relieve the master of his liability for the breach of his contract.
Every legal obligation must of necessity be extra-contractual or contractual. Extra-
contractual obligation has its source in the breach or omission of those mutual duties
which civilized society imposes upon it members, or which arise from these relations, other
than contractual, of certain members of society to others, generally embraced in the
concept of status. The legal rights of each member of society constitute the measure of
the corresponding legal duties, mainly negative in character, which the existence of those
rights imposes upon all other members of society. The breach of these general duties
whether due to willful intent or to mere inattention, if productive of injury, give rise to an
obligation to indemnify the injured party. The fundamental distinction between obligations
of this character and those which arise from contract, rests upon the fact that in cases of
non-contractual obligation it is the wrongful or negligent act or omission itself which
creates the vinculum juris, whereas in contractual relations the vinculum exists
independently of the breach of the voluntary duty assumed by the parties when entering
into the contractual relation.
With respect to extra-contractual obligation arising from negligence, whether of act or
omission, it is competent for the legislature to elect — and our Legislature has so elected
— whom such an obligation is imposed is morally culpable, or, on the contrary, for reasons
of public policy, to extend that liability, without regard to the lack of moral culpability, so
as to include responsibility for the negligence of those person who acts or mission are
imputable, by a legal fiction, to others who are in a position to exercise an absolute or
limited control over them. The legislature which adopted our Civil Code has elected to limit
extra-contractual liability — with certain well-defined exceptions — to cases in which moral
culpability can be directly imputed to the persons to be charged. This moral responsibility
may consist in having failed to exercise due care in the selection and control of one's
agents or servants, or in the control of persons who, by reason of their status, occupy a
position of dependency with respect to the person made liable for their conduct.
The position of a natural or juridical person who has undertaken by contract to render
service to another, is wholly different from that to which article 1903 relates. When the
sources of the obligation upon which plaintiff's cause of action depends is a negligent act
or omission, the burden of proof rests upon plaintiff to prove the negligence — if he does
not his action fails. But when the facts averred show a contractual undertaking by
defendant for the benefit of plaintiff, and it is alleged that plaintiff has failed or refused to
perform the contract, it is not necessary for plaintiff to specify in his pleadings whether the
breach of the contract is due to willful fault or to negligence on the part of the defendant,
or of his servants or agents. Proof of the contract and of its nonperformance is
sufficient prima facie to warrant a recovery.
As a general rule . . . it is logical that in case of extra-contractual culpa, a suing creditor
should assume the burden of proof of its existence, as the only fact upon which his
action is based; while on the contrary, in a case of negligence which presupposes the
existence of a contractual obligation, if the creditor shows that it exists and that it has
been broken, it is not necessary for him to prove negligence. (Manresa, vol. 8, p. 71
[1907 ed., p. 76]).
As it is not necessary for the plaintiff in an action for the breach of a contract to show that
the breach was due to the negligent conduct of defendant or of his servants, even though
such be in fact the actual cause of the breach, it is obvious that proof on the part of
defendant that the negligence or omission of his servants or agents caused the breach of
the contract would not constitute a defense to the action. If the negligence of servants or
agents could be invoked as a means of discharging the liability arising from contract, the
anomalous result would be that person acting through the medium of agents or servants
in the performance of their contracts, would be in a better position than those acting in
person. If one delivers a valuable watch to watchmaker who contract to repair it, and the
bailee, by a personal negligent act causes its destruction, he is unquestionably liable.
Would it be logical to free him from his liability for the breach of his contract, which
involves the duty to exercise due care in the preservation of the watch, if he shows that it
was his servant whose negligence caused the injury? If such a theory could be accepted,
juridical persons would enjoy practically complete immunity from damages arising from
the breach of their contracts if caused by negligent acts as such juridical persons can of
necessity only act through agents or servants, and it would no doubt be true in most
instances that reasonable care had been taken in selection and direction of such servants.
If one delivers securities to a banking corporation as collateral, and they are lost by reason
of the negligence of some clerk employed by the bank, would it be just and reasonable to
permit the bank to relieve itself of liability for the breach of its contract to return the
collateral upon the payment of the debt by proving that due care had been exercised in
the selection and direction of the clerk?
This distinction between culpa aquiliana, as the source of an obligation, and culpa
contractual as a mere incident to the performance of a contract has frequently been
recognized by the supreme court of Spain. (Sentencias  of June 27, 1894; November 20,
1896; and December 13, 1896.) In the decisions of November 20, 1896, it appeared that
plaintiff's action arose ex contractu, but that defendant sought to avail himself of the
provisions of article 1902 of the Civil Code as a defense. The Spanish Supreme Court
rejected defendant's contention, saying:
These are not cases of injury caused, without any pre-existing obligation, by fault or
negligence, such as those to which article 1902 of the Civil Code relates, but of
damages caused by the defendant's failure to carry out the undertakings imposed by
the contracts . . . .
A brief review of the earlier decision of this court involving the liability of employers for
damage done by the negligent acts of their servants will show that in no case has the
court ever decided that the negligence of the defendant's servants has been held to
constitute a defense to an action for damages for breach of contract.
In the case of Johnson vs. David (5 Phil. Rep., 663), the court held that the owner of a
carriage was not liable for the damages caused by the negligence of his driver. In that
case the court commented on the fact that no evidence had been adduced in the trial court
that the defendant had been negligent in the employment of the driver, or that he had any
knowledge of his lack of skill or carefulness.
In the case of Baer Senior & Co's Successors vs. Compania Maritima (6 Phil. Rep., 215),
the plaintiff sued the defendant for damages caused by the loss of a barge belonging to
plaintiff which was allowed to get adrift by the negligence of defendant's servants in the
course of the performance of a contract of towage. The court held, citing Manresa (vol. 8,
pp. 29, 69) that if the "obligation of the defendant grew out of a contract made between it
and the plaintiff . . . we do not think that the provisions of articles 1902 and 1903 are
applicable to the case."
In the case of Chapman vs. Underwood (27 Phil. Rep., 374), plaintiff sued the defendant
to recover damages for the personal injuries caused by the negligence of defendant's
chauffeur while driving defendant's automobile in which defendant was riding at the time.
The court found that the damages were caused by the negligence of the driver of the
automobile, but held that the master was not liable, although he was present at the time,
saying:
. . . unless the negligent acts of the driver are continued for a length of time as to give
the owner a reasonable opportunity to observe them and to direct the driver to desist
therefrom. . . . The act complained of must be continued in the presence of the owner
for such length of time that the owner by his acquiescence, makes the driver's acts his
own.
In the case of Yamada vs. Manila Railroad Co. and Bachrach Garage & Taxicab Co. (33
Phil. Rep., 8), it is true that the court rested its conclusion as to the liability of the
defendant upon article 1903, although the facts disclosed that the injury complaint of by
plaintiff constituted a breach of the duty to him arising out of the contract of
transportation. The express ground of the decision in this case was that article 1903, in
dealing with the liability of a master for the negligent acts of his servants "makes the
distinction between private individuals and public enterprise;" that as to the latter the law
creates a rebuttable presumption of negligence in the selection or direction of servants;
and that in the particular case the presumption of negligence had not been overcome.
It is evident, therefore that in its decision Yamada case, the court treated plaintiff's action
as though founded in tort rather than as based upon the breach of the contract of
carriage, and an examination of the pleadings and of the briefs shows that the questions
of law were in fact discussed upon this theory. Viewed from the standpoint of the
defendant the practical result must have been the same in any event. The proof disclosed
beyond doubt that the defendant's servant was grossly negligent and that his negligence
was the proximate cause of plaintiff's injury. It also affirmatively appeared that defendant
had been guilty of negligence in its failure to exercise proper discretion in the direction of
the servant. Defendant was, therefore, liable for the injury suffered by plaintiff, whether
the breach of the duty were to be regarded as constituting culpa aquiliana  or culpa
contractual. As Manresa points out (vol. 8, pp. 29 and 69) whether negligence occurs an
incident in the course of the performance of a contractual undertaking or its itself the
source of an extra-contractual undertaking obligation, its essential characteristics are
identical. There is always an act or omission productive of damage due to carelessness or
inattention on the part of the defendant. Consequently, when the court holds that a
defendant is liable in damages for having failed to exercise due care, either directly, or in
failing to exercise proper care in the selection and direction of his servants, the practical
result is identical in either case. Therefore, it follows that it is not to be inferred, because
the court held in the Yamada case that defendant was liable for the damages negligently
caused by its servants to a person to whom it was bound by contract, and made reference
to the fact that the defendant was negligent in the selection and control of its servants,
that in such a case the court would have held that it would have been a good defense to
the action, if presented squarely upon the theory of the breach of the contract, for
defendant to have proved that it did in fact exercise care in the selection and control of the
servant.
The true explanation of such cases is to be found by directing the attention to the relative
spheres of contractual and extra-contractual obligations. The field of non- contractual
obligation is much more broader than that of contractual obligations, comprising, as it
does, the whole extent of juridical human relations. These two fields, figuratively speaking,
concentric; that is to say, the mere fact that a person is bound to another by contract does
not relieve him from extra-contractual liability to such person. When such a contractual
relation exists the obligor may break the contract under such conditions that the same act
which constitutes the source of an extra-contractual obligation had no contract existed
between the parties.
The contract of defendant to transport plaintiff carried with it, by implication, the duty to
carry him in safety and to provide safe means of entering and leaving its trains (civil code,
article 1258). That duty, being contractual, was direct and immediate, and its non-
performance could not be excused by proof that the fault was morally imputable to
defendant's servants.
The railroad company's defense involves the assumption that even granting that the
negligent conduct of its servants in placing an obstruction upon the platform was a breach
of its contractual obligation to maintain safe means of approaching and leaving its trains,
the direct and proximate cause of the injury suffered by plaintiff was his own contributory
negligence in failing to wait until the train had come to a complete stop before alighting.
Under the doctrine of comparative negligence announced in the Rakes case (supra), if the
accident was caused by plaintiff's own negligence, no liability is imposed upon defendant's
negligence and plaintiff's negligence merely contributed to his injury, the damages should
be apportioned. It is, therefore, important to ascertain if defendant was in fact guilty of
negligence.
It may be admitted that had plaintiff waited until the train had come to a full stop before
alighting, the particular injury suffered by him could not have occurred. Defendant
contends, and cites many authorities in support of the contention, that it is negligence  per
se for a passenger to alight from a moving train. We are not disposed to subscribe to this
doctrine in its absolute form. We are of the opinion that this proposition is too badly stated
and is at variance with the experience of every-day life. In this particular instance, that
the train was barely moving when plaintiff alighted is shown conclusively by the fact that it
came to stop within six meters from the place where he stepped from it. Thousands of
person alight from trains under these conditions every day of the year, and sustain no
injury where the company has kept its platform free from dangerous obstructions. There is
no reason to believe that plaintiff would have suffered any injury whatever in alighting as
he did had it not been for defendant's negligent failure to perform its duty to provide a
safe alighting place.
We are of the opinion that the correct doctrine relating to this subject is that expressed in
Thompson's work on Negligence (vol. 3, sec. 3010) as follows:
The test by which to determine whether the passenger has been guilty of negligence in
attempting to alight from a moving railway train, is that of ordinary or reasonable care.
It is to be considered whether an ordinarily prudent person, of the age, sex and
condition of the passenger, would have acted as the passenger acted under the
circumstances disclosed by the evidence. This care has been defined to be, not the care
which may or should be used by the prudent man generally, but the care which a man
of ordinary prudence would use under similar circumstances, to avoid injury."
(Thompson, Commentaries on Negligence, vol. 3, sec. 3010.)
Or, it we prefer to adopt the mode of exposition used by this court in Picart vs. Smith (37
Phil. rep., 809), we may say that the test is this; Was there anything in the circumstances
surrounding the plaintiff at the time he alighted from the train which would have
admonished a person of average prudence that to get off the train under the conditions
then existing was dangerous? If so, the plaintiff should have desisted from alighting; and
his failure so to desist was contributory negligence.
As the case now before us presents itself, the only fact from which a conclusion can be
drawn to the effect that plaintiff was guilty of contributory negligence is that he stepped
off the car without being able to discern clearly the condition of the platform and while the
train was yet slowly moving. In considering the situation thus presented, it should not be
overlooked that the plaintiff was, as we find, ignorant of the fact that the obstruction
which was caused by the sacks of melons piled on the platform existed; and as the
defendant was bound by reason of its duty as a public carrier to afford to its passengers
facilities for safe egress from its trains, the plaintiff had a right to assume, in the absence
of some circumstance to warn him to the contrary, that the platform was clear. The place,
as we have already stated, was dark, or dimly lighted, and this also is proof of a failure
upon the part of the defendant in the performance of a duty owing by it to the plaintiff; for
if it were by any possibility concede that it had right to pile these sacks in the path of
alighting passengers, the placing of them adequately so that their presence would be
revealed.
As pertinent to the question of contributory negligence on the part of the plaintiff in this
case the following circumstances are to be noted: The company's platform was
constructed upon a level higher than that of the roadbed and the surrounding ground. The
distance from the steps of the car to the spot where the alighting passenger would place
his feet on the platform was thus reduced, thereby decreasing the risk incident to stepping
off. The nature of the platform, constructed as it was of cement material, also assured to
the passenger a stable and even surface on which to alight. Furthermore, the plaintiff was
possessed of the vigor and agility of young manhood, and it was by no means so risky for
him to get off while the train was yet moving as the same act would have been in an aged
or feeble person. In determining the question of contributory negligence in performing
such act — that is to say, whether the passenger acted prudently or recklessly — the age,
sex, and physical condition of the passenger are circumstances necessarily affecting the
safety of the passenger, and should be considered. Women, it has been observed, as a
general rule are less capable than men of alighting with safety under such conditions, as
the nature of their wearing apparel obstructs the free movement of the limbs. Again, it
may be noted that the place was perfectly familiar to the plaintiff as it was his daily
custom to get on and of the train at this station. There could, therefore, be no uncertainty
in his mind with regard either to the length of the step which he was required to take or
the character of the platform where he was alighting. Our conclusion is that the conduct of
the plaintiff in undertaking to alight while the train was yet slightly under way was not
characterized by imprudence and that therefore he was not guilty of contributory
negligence.
The evidence shows that the plaintiff, at the time of the accident, was earning P25 a
month as a copyist clerk, and that the injuries he has suffered have permanently disabled
him from continuing that employment. Defendant has not shown that any other gainful
occupation is open to plaintiff. His expectancy of life, according to the standard mortality
tables, is approximately thirty-three years. We are of the opinion that a fair compensation
for the damage suffered by him for his permanent disability is the sum of P2,500, and that
he is also entitled to recover of defendant the additional sum of P790.25 for medical
attention, hospital services, and other incidental expenditures connected with the
treatment of his injuries.
The decision of lower court is reversed, and judgment is hereby rendered plaintiff for the
sum of P3,290.25, and for the costs of both instances. So ordered.
[G.R. No. 49308. May 13, 1948.]
MARIA LUISA MARTINEZ, Petitioner, v. MANUEL H. BARREDO ET
AL., Respondents.
Delfin L. Gonzalez for Petitioner.
Antonio Barredo for Respondents.
SYLLABUS
1. CRIMINAL LAW AND PROCEDURE; EVIDENCE; JUDGMENT OF CONVICTION;
CONCLUSIVENESS AGAINST PERSON SUBSIDIARILY LIABLE FOR CIVIL INDEMNITY. — In
the absence of any collusion, a judgment of conviction sentencing the defendant to pay
indemnity is conclusive in an action against his employer for the enforcement of the
latter’s subsidiary liability under articles 102 and 103 of the Revised Penal Code.
2. ID.; CRIMINAL NEGLIGENCE; ACQUITTAL BAR TO CIVIL LIABILITY. — Acquittal from
criminal negligences wipes out not only the employee’s primary civil liability but also his
employer’s subsidiary liability.
DECISION
PARAS, J.:
On April 11, 1940, a taxicab owned by Fausto Barredo and driven by Rosendo Digman
collided in a Manila thoroughfare with Chevrolet car driven by Maria Luisa Martinez. The
collision gave rise to mutual charges for damage to property through reckless imprudence,
one by Maria Luisa Martinez against Digman, and the other by Fausto Barredo against
Maria Luisa Martinez. After investigation, the fiscal filed an information against Digman
and quashed Barredo’s complaint. Digman entered a plea of guilty in his criminal case and
was therefore sentenced to pay a fine of P605.97 and to indemnify Maria Luisa Martinez in
the same amount, with subsidiary imprisonment in case of insolvency, and the costs.
Digman failed to pay any of these amounts and had to undergo corresponding subsidiary
imprisonment. Due to the inability of Digman to pay the indemnity, Maria Luisa Martinez,
filed an action in the Court of First Instance of Manila against Fausto Barredo, as Digman’s
employer, for the purpose of holding him subsidiarily liable for said indemnity under
articles 102 and 103 of the Revised Penal Code. At the trial Maria Luisa Martinez relied
solely on the judgment of conviction against Rosendo Digman, the writ of execution issued
against him, a certificate of the Director of Prisons regarding Digman’s service of
subsidiary imprisonment, and the information filed against Digman. Maria Luisa Martinez
obtained a favorable judgment from which Barredo appealed to the Court of Appeals. The
latter court, reversing the decision of the Court of First Instance, held that the judgment of
conviction was not conclusive against Barredo and its weight as prima facie evidence was
overcome by the evidence presented by Barredo. Hence the present appeal of Maria Luisa
Martinez by way of certiorari.
The important question is whether a judgment of conviction sentencing the defendant to
pay an indemnity is conclusive in an action against his employer for the enforcement of
the latter’s subsidiary liability under articles 102 and 103 of the Revised Penal Code. The
appealed decision makes reference to two earlier decisions of this Court, namely, City of
Manila v. Manila Electric Co., 52 Phil., 586, holding that such judgment of conviction is not
admissible, and Arambulo v. Manila Electric Co., 55 Phil., 75, in effect holding that it is
merely prima facie evidence, and to the prevailing view in the United States to the effect
that the person subsidiarily liable is bound by the judgment if the former had notice of the
criminal case and could have defended it had he seen fit to do so, and that otherwise such
judgment is only prima facie evidence.
After very careful reflection, we have arrived at the opinion that the judgment of
conviction, in the absence of any collusion between the defendant and the offended party,
should bind the person subsidiarily liable. The stigma of a criminal conviction surpasses in
effect and implications mere civil liability. Common sense dictates that a finding of guilt in
a criminal case in which proof beyond reasonable doubt is necessary, should not be
nullified in a subsequent civil action requiring only preponderance of evidence to support a
judgment, unless those who support the contrary rule should also hold that an absolution
in a civil case will operate to automatically set aside the verdict against the defendant in
the criminal case. It is anomalous, to say the least, to suppose that the driver, excelling
"Dr. Jekyll and Mr. Hyde", could be guilty of reckless negligence in so far as his obligation
to pay indemnity is concerned, and at the same time could be free from any blame when
said indemnity is sought to be collected from his employer, although the right to the
indemnity arose from and was based on one and the same act of the driver.
The employer cannot be said to have been deprived of his day in court, because the
situation before us is not one wherein the employer is sued or a primary liability under
article 1903 of the Civil Code, but one in which enforcement is sought of a subsidiary civil
liability incident to and dependent upon his driver’s criminal negligence which is a proper
issue to be tried and decided only in a criminal action. In other words, the employer
becomes ipso facto subsidiarily liable upon his driver’s conviction and upon proof of the
latter’s insolvency, in the same way that acquittal wipes out not only the employee’s
primary civil liability but also his employer’s subsidiary liability for such criminal
negligence. (Almeida Et. Al., v. Abaroa, 8 Phil., 178, affirmed in 218 U. S., 476; 54 Law
ed., 1116; Wise & Co. v. Larion, 45 Phil. 314, 320; Francisco v. Onrubia, 46 Phil., 327;
Province of Ilocos Sur v. Tolentino, G. R. No. 34186, 56 Phil., 829; Moran, Comments on
the Rules of Court, Vol. II, p. 403.)
It is high time that the employer exercised the greatest care in selecting his employees,
taking real and deep interest in their welfare; intervening in any criminal action brought
against them by reason of or as a result of the performance of their duties, if only in the
way of giving them the benefit of counsel; and consequently doing away with the practice
of leaving them to their fates. If these be done, the American rule requiring notice on the
part of the employer shall have been satisfied.
It becomes unnecessary to rely on the circumstance that the filing of mutual charges by
Fausto Barredo and Maria Luisa Martinez, with the result, as above stated, that while the
fiscal proceeded in filing the information against Digman, he quashed the charges of
Fausto Barredo, may easily lead to the presumption that the latter should have had
knowledge of the criminal case against his driver. We need not also make any
pronouncement to the effect that the prevailing American view is based upon substantive
and procedural laws not similar to those obtaining in this jurisdiction.
Wherefore, the decision of the Court of Appeals is reversed, and Fausto Barredo, now
substituted by his heirs and legal representatives, are hereby sentenced to pay, subject to
Executive Order No. 32 on Moratorium, to the petitioner, Maria Luisa Martinez, the sum of
P605.97, with legal interest from the date of the filing of the complaint. So ordered with
costs against the respondents.
G.R. Nos. L-21477-81             April 29, 1966
FRANCISCA VILUAN, petitioner,
vs.
THE COURT OF APPEALS, PATRICIO HUFANA and GREGORIO
HUFANA, respondents.
Jose A. Solomon, for petitioner.
Lourdes M. Garcia, for respondents.
REGALA, J.:
Seven persons were killed and thirteen others were injured in Bangar, La Union, on
February 16, 1958, when a passenger bus on which they were riding caught fire after
hitting a post and crashing against a tree. The bus, owned by petitioner and driven by
Hermenegildo Aquino, came from San Fernando, La Union and was on its way to Candon,
Ilocos Sur.
It appears that, as the bus neared the gate of the Gabaldon school building in the
municipality of Bangar, another passenger bus owned by Patricio Hufana and driven by
Gregorio Hufana tried to overtake it but that instead of giving way, Aquino increased the
speed of his bus and raced with the overtaking bus. Aquino lost control of his bus as a
result of which it hit a post, crashed against a tree and then burst into flames.
Among those who perished were Timoteo Mapanao, Francisca Lacsamana, Narcisa
Mendoza and Gregorio Sibayan, whose heirs sued petitioner and the latter's driver,
Hermenegildo Aquino, for damages for breach of contract of carriage. Carolina Sabado,
one of those injured, also sued petitioner and the driver for damages. The complaints were
filed in the Court of First Instance of La Union.
In their answer, petitioner and her driver blamed respondent Gregorio Hufana for the
accident. With leave of court, they filed third party complaints against Hufana and the
latter's employer, Patricio Hufana.
After trial, the court found that the accident was due to the concurrent negligence of the
drivers of the two buses and held both, together with their respective employers, jointly
and severally liable for damages.
The dispositive portion of its decision reads:
IN VIEW OF ALL THE FOREGOING, judgment is hereby rendered, declaring the
plaintiff's entitled to damages to be paid jointly and severally by the defendants and
third-party defendants as follows:
(1) For plaintiff Juliana C. Vda. de Mapanao for the death of her son Timoteo Mapanao,
the sum of P5,000.00 for actual damages, P1,000.00 as moral damages and P250.00
as attorney's fees;
(2) For plaintiff Leon Lacsamana for the death of his daughter Francisca Lacsamana,
the sum of P4,000.00 as actual damages, P1,000.00 as moral damages and P250.00 as
attorney's fees;
(3) For plaintiffs Juan Mendoza and Magdalena Mendoza for the death of their mother
Narcisa Mendoza, the sum of P4,000.00 for actual damages, P1,000.00 for moral
damages and P250.00 as attorney's fees;
(4) For plaintiffs Agustina Sabado, Quintin Sibayan, Julita Sibayan, Primitivo Sibayan
and Avelina Sibayan, the sum of P4,000.00 for actual damages, P1,500.00 for moral
damages and P250.00 as attorney's fees;
(5) For the injured passenger Carolina Sabado, P649.00 for actual damages, P1,000.00
for moral damages and P250.00 for attorney's fees.
All such amounts awarded as damages shall bear interest at the legal rate of six per
cent (6%) per annum from the date of this decision until the same shall have been duly
paid in full.
Defendants and third-party defendants are further ordered to pay proportionate costs."
Both petitioner and her driver and the respondents herein appealed to the Court of
Appeals. While affirming the finding that the accident was due to the concurrent
negligence of the drivers of both the Viluan and the Hufana buses, the Court of Appeals
differed with the trial court in the assessment of liabilities of the parties. In its view only
petitioner Francisca Viluan, as operator of the bus, is liable for breach of contract of
carriage. The driver, Hermenegildo Aquino, cannot be made jointly and severally liable
with petitioner because he is merely the latter's employee and is in no way a party to the
contract of carriage. The court added, however —
Hermenegildo Aquino is not entirely free from liability. He may be held liable, criminally
and civilly, under the Revised Penal Code (Articles 100 and 103), but not in a civil suit
for damages predicated upon a breach of contract, such as this one (Aguas, et al. vs.
Vargas, et al., CA-G.R. No. 27161-R, Jan. 22, 1963). Furthermore, the common carrier,
Francisca Viluan could recover from Aquino any damages that she might have suffered
by reason of the latter's negligence.
Neither may respondents Patricio Hufana and Gregorio Hufana be held liable in the opinion
of the appellate court because the plaintiffs did not amend complaints in the main action
so as to assert a claim against the respondents as third party defendants.
The appellate court likewise disallowed the award of moral damages for P1,000.00 to
Carolina Sabado, there being no showing that the common carrier was guilty of fraud or
bad faith in the performance of her obligation. Accordingly, it rendered judgment as
follows:
IN VIEW OF ALL THE FOREGOING, we hereby find defendant-appellant Francisca Viluan
solely liable to the plaintiffs-appellees for the damages and attorney's fees awarded to
them by the court below and further declare null and void the lower court's award of
moral damages in the amount of P1,000.00 in favor of plaintiff Carolina Sabado. Thus
modified, the judgment appealed from is affirmed in all other respects, with costs in
this instance against defendant-appellant Francisca Viluan.
From this judgment petitioner brought this appeal. In brief, her position is that since the
proximate cause of the accident was found to be the concurrent negligence of the drivers
of the two buses, then she and respondent Patricio and Gregorio Hufana should have been
held equally liable to the plaintiffs in the damage suits. The fact that the respondents were
not sued as principal defendants but were brought into the cases as third party defendants
should not preclude a finding of their liability.
We agree with petitioner's contention. To begin with, the Court of Appeals' ruling is based
on section 5 of Rule 12 of the former Rules of Court, which was adopted from Rule 14-a of
the Federal Rules of Civil Procedure. While the latter provision has indeed been held to
preclude a judgment in favor of a plaintiff and against a third party defendant where the
plaintiff has not amended his complaint to assert a claim against a third party
defendant, yet, as held in subsequent decisions, this rule applies only to cases where the
third party defendant is brought in on an allegation of liability to the defendants. The rule
does not apply where a third-party defendant is impleaded on the ground of direct liability
to the plaintiffs, in which case no amendment of the plaintiffs complaint is necessary. As
explained in the Atlantic Coast Line R. Co. vs. U. S. Fidelity & Guaranty Co., 52 F. Supp.
177 (1943):
From the sources of Rule 14 and the decisions herein cited, it is clear that this rule, like
the admiralty rule, "covers two distinct subjects, the addition of parties defendant to
the main cause of action, and the bringing in of a third party for a defendant's remedy
over." x x x
If the third party complaint alleges facts showing a third party's direct liability to
plaintiff on the claim set out in plaintiff's petition, then third party "shall" make his
defenses as provided in Rule 12 and his counterclaims against plaintiff as provided in
Rule 13. In the case of alleged direct liability, no amendment is necessary or required.
The subject-matter of the claim is contained in plaintiff's complaint, the ground of third
party's liability on that claim is alleged in third party complaint, and third party's
defense to set up in his an to plaintiff's complaint. At that point and without
 amendment, the plaintiff and third party are at issue as to their rights respecting the
claim.
The provision in the rule that, "The third-party defendant may assert any defenses
which the third-party plaintiff may assert to the plaintiff's claim," applies to the other
subject, namely, the alleged liability of third party defendant. The next sentence in the
rule, "The third-party defendant is bound by the adjudication of the third party
plaintiff's liability to the plaintiff, as well as of his own to the plaintiff or to the third-
party plaintiff," applies to both subjects. If third party is brought in as liable only to
defendant and judgment is rendered adjudicating plaintiff's right to recover against
defendant and defendant's rights to recover against third party, he is bound by both
adjudications. That part of the sentence refers to the second subject. If third party is
brought in as liable to plaintiff, then third party is bound by the adjudication as
between him and plaintiff. That refers to the first subject. If third party is brought in as
liable to plaintiff and also over to defendant, then third party is bound by both
adjudications. The next sentence in the rule, "The plaintiff may amend his pleadings to
assert against the third-party defendant any claim which the plaintiff might have
asserted against the third-party defendant had he been joined originally as a
defendant," refers to the second subject, that is, to bringing in third party as liable to
defendant only, and does not apply to the alleged liability of third party directly to
plaintiff."
In this case the third-party complaints filed by petitioner and her driver charged
respondents with direct liability to the plaintiffs. It was contended that the accident was
due "to the fault, negligence, carelessness and imprudence of the third party defendant
Gregorio Hufana" and, in petitioner's motion for leave to file a third party complaint, it was
stated that "Patricio Hufana and Gregorio Hufana were not made parties to this action,
although the defendants are entitled to indemnity and/or subrogation against them in
respect of plaintiff's claim."
It should make no difference therefore whether the respondents were brought in as
principal defendants or as third-party defendants. As Chief Justice Moran points out, since
the liability of the third-party defendant is already asserted in the third-party complaint,
the amendment of the complaint to assert such liability is merely a matter of form, to
insist on which would not be in keeping with the liberal spirit of the Rules of Court.
Nor should it make any difference that the liability of petitioner springs from contract while
that of respondents arises from quasi-delict. As early as 1913, we already ruled
in Gutierrez vs. Gutierrez, 56 Phil. 177, that in case of injury to a passenger due to the
negligence of the driver of the bus on which he was riding and of the driver of another
vehicle, the drivers as well as the owners of the two vehicles are jointly and severally
liable for damages. Some members of the Court, though, are of the view that under the
circumstances they are liable on quasi-delict.
Wherefore, the decision appealed from is hereby modified in the sense that petitioner as
well as respondents Patricio Hufana and Gregorio Hufana are jointly and severally liable for
the damages awarded by the trial court. The disallowance of moral damages in the
amount of P1,000.00 is correct and should be affirmed. No costs.
[G.R. No. 8896. December 29, 1913. ]
EDUARDO GUTIERREZ REPIDE, Plaintiff-Appellee, v. GUTIERREZ
HERMANOS, Defendant-Appellant.
Socias, Orense & Blanco, for Appellee.
O’Brien & DeWitt, for Appellant.
SYLLABUS
1. ATTORNEY AND CLIENT; FEES. — When proof is lacking that an attorney, in
undertaking to conduct a suit, expressly obligated himself to render his professional
services therein, and in the other suits his client might afterwards prosecute, on condition
that he should not receive more than a certain amount, fixed at the execution of the
contract made in connection with the first suit already initiated, it would be neither proper
nor just to hold that said attorney contracted such an obligation to counsel and defend his
client in all the latter’s suits, at that time or later, for without the clear and manifest
intention and express will on his part it would not be lawful to bind the attorney’s
professional services to conduct all the suits that might arise, without other compensation
than the sum fixed at the beginning of the first suit.
2. ID.; ID.; CONSTRUCTION OF CONTRACT. — In case of doubt regarding the meaning or
construction of the contents and scope of a contract, strict application should be made of
article 1283, Civil Code, wherein it is provided that, whatever may be the general sense of
the terms of a contract, things and facts different from what the interested parties
intended to contract upon are not to be understood as embraced therein; and in
accordance with article 1289 of the same Code, if the contract is for a valuable
consideration the doubt shall be resolved in favor of the greatest reciprocity of interests,
and certainly no such reciprocity of interests is involved and it is contrary to common
sense and sound reasoning to extends to all the suits which might arise in the future and
which were unforeseen the agreement entered into by an attorney to conduct a suit
already initiated for a certain stipulated sum as compensation for his professional services
in that case, since favorable terms must be construed broadly and liberally and onerous
ones with limitation and strict justice.
DECISION
TORRES, J.  :
This appeal, through a bill of exceptions, was raised by counsel for the commercial firm of
Gutierrez Hermanos counsel for the judgment of February 10, 1913, rendered by the
Honorable A. S. Crossfield, judge, in favor of the plaintiff and against the defendant firm of
Gutierrez Hermanos, for the sum of P1,600, together with interest thereon at 6 per cent
per annum from the first day of March, 1912, and for the costs of the action.
On February 26, 1912, the attorney Eduardo Gutierrez Repide filed suit in the Court of
First Instance of this city against the commercial firm of Gutierrez Hermanos, alleging that
he had at its request rendered it services as attorney in case No. 7719, in which the firm
of Gutierrez Hermanos was plaintiff and Oria Hermanos & Co. defendant; which suit,
instituted for the collection of P12,218.51 and interest thereon, was decided and
afterwards appealed by the defendant to the Supreme Court, which affirmed the judgment
of the lower court by sentencing the defendant to pay the said sum to the plaintiff; 1 and
that, after the litigation was decided in this second instance, the plaintiff endeavored to
collect from Gutierrez Hermanos P2,000 as fees for all the professional services he had
rendered in that suit, but that this sum had not been paid him either wholly or partly,
although it was a just, reasonable and equitable compensation in consideration of the
subject matter of the suit and the kind and value of his services as attorney. He therefore
asked that Gutierrez Hermanos be sentenced to pay the said sum, with legal interest
thereon from the date of the filing of the complaint, and the costs.
The defendant firm, in its amended answer, alleged as a special defense that on August 12
and November 27, 1909, it agreed with the plaintiff that the fee which the latter was to
collect for all his professional services and for all the suits which the might have to bring
against Oria Hermanos, including all procedure had therein until their termination, should
not exceed P10,000, and that, in case the work should turn out to be less than was
supposed and he should not have to make any trip to the provinces, the said sum should
be reduced by such amount as would be just and reasonable; that, on January 3, the
plaintiff collected from the defendant, on account of his contract for fees, the sum of
P3,000 and, in addition thereto, received from the grocery store of Gutierrez Hermanos
effects and merchandise amounting to P1,669.81, making a total of P4,666.81 received by
the plaintiff; that, because of the delay in the prosecution of case No. 7289, 2 Oria
Hermanos & Co. succeeded in selling all the property of the firm to Manuel Oria y
Gonzalez, on which account Gutierrez Hermanos had to seek a temporary attachment of
such property; that the plaintiff, failing to comply with his engagements, ceased to defend
the defendant and withdrew as its attorney just prior to the date set for the hearing,
without giving the defendant time to turn over its defense to another attorney, and,
ignoring his contract, commenced to sue the defendant; and that there was no need of
filing a complaint in this case, since it could have been included as a second cause of
action in case No. 7289; and it therefore requested that the plaintiff’s complaint be
dismissed, with the costs of the action.
We accept the statement of facts, the conclusions and the legal grounds of the judgment
appealed from, since they are in accordance with the law and the merits of the case, and
affirm the said judgment, with the costs against the Appellant.
G.R. No. L-16598             October 3, 1921
H. E. HEACOCK COMPANY, plaintiff-appellant,
vs.
MACONDRAY & COMPANY, INC., defendant-appellant.
Fisher & DeWitt for plaintiff-appellant.
Wolfson, Wolfson & Schwarzkopf for defendant-appellant.
JOHNSON, J.:
This action was commenced in the Court of First Instance of the City of Manila to recover
the sum of P240 together with interest thereon. The facts are stipulated by the parties,
and are, briefly, as follows:
(1) On or about the 5th day of June, 1919, the plaintiff caused to be delivered on board
of steamship Bolton Castle, then in the harbor of New York, four cases of merchandise
one of which contained twelve (12) 8-day Edmond clocks properly boxed and marked
for transportation to Manila, and paid freight on said clocks from New York to Manila in
advance. The said steampship arrived in the port of Manila on or about the 10th day of
September, 1919, consigned to the defendant herein as agent and representative of
said vessel in said port. Neither the master of said vessel nor the defendant herein, as
its agent, delivered to the plaintiff the aforesaid twelve 8-day Edmond clocks, although
demand was made upon them for their delivery.
(2) The invoice value of the said twelve 8-day Edmond clocks in the city of New York
was P22 and the market value of the same in the City of Manila at the time when they
should have been delivered to the plaintiff was P420.
(3) The bill of lading issued and delivered to the plaintiff by the master of the said
steamship Bolton Castle contained, among others, the following clauses:
1. It is mutually agreed  that the value of the goods receipted for above does not
exceed $500 per freight ton, or, in proportion for any part of a ton, unless the value
be expressly stated herein and ad valorem freight paid thereon.
9. Also, that in the event of claims for short delivery of, or damage to, cargo being
made, the carrier shall not be liable for more than the net invoice price plus freight
and insurance less all charges saved, and any loss or damage for which the carrier
may be liable shall be adjusted pro rata on the said basis.
(4) The case containing the aforesaid twelve 8-day Edmond clocks measured 3 cubic
feet, and the freight ton value thereof was $1,480, U. S. currency.
(5) No greater value than $500, U. S. currency, per freight ton was declared by the
plaintiff on the aforesaid clocks, and no ad valorem freight was paid thereon.
 (6) On or about October 9, 1919, the defendant tendered to the plaintiff P76.36, the
proportionate freight ton value of the aforesaid twelve 8-day Edmond clocks, in
payment of plaintiff's claim, which tender plaintiff rejected.
The lower court, in accordance with clause 9 of the bill of lading above quoted, rendered
judgment in favor of the plaintiff against the defendant for the sum of P226.02, this being
the invoice value of the clocks in question plus the freight and insurance thereon, with
legal interest thereon from November 20, 1919, the date of the complaint, together with
costs. From that judgment both parties appealed to this court.
The plaintiff-appellant insists that it is entitled to recover from the defendant the market
value of the clocks in question, to wit: the sum of P420. The defendant-appellant, on the
other hand, contends that, in accordance with clause 1 of the bill of lading, the plaintiff is
entitled to recover only the sum of P76.36, the proportionate freight ton value of the said
clocks. The claim of the plaintiff is based upon the argument that the two clause in the bill
of lading above quoted, limiting the liability of the carrier, are contrary to public order and,
therefore, null and void. The defendant, on the other hand, contends that both of said
clauses are valid, and the clause 1 should have been applied by the lower court instead of
clause 9.
I. The appeal of the plaintiff presents this question; May a common carrier, by stipulations
inserted in the bill of lading, limit its liability for the loss of or damage to the cargo to an
agreed valuation of the latter?
Three kinds of stipulations have often been made in a bill of lading. The  first is one
exempting the carrier from any and all liability for loss or damage occasioned by its own
negligence. The second is one providing for an unqualified limitation of such liability to an
agreed valuation. And the third  is one limiting the liability of the carrier to an agreed
valuation unless the shipper declares a higher value and pays a higher rate of freight.
According to an almost uniform weight of authority, the first and second kinds of
stipulations are invalid as being contrary to public policy, but the third is valid and
enforceable.
The authorities relied upon by the plaintiff-appellant (the Harter Act [Act of Congress of
February 13, 1893]: Louisville Ry. Co. vs. Wynn, 88 Tenn., 320; and Galt vs. Adams
Express Co., 4 McAr., 124; 48 Am. Rep., 742) support the proposition that the first and
second stipulations in a bill of lading are invalid which either exempt the carrier from
liability for loss or damage occasioned by its negligence, or provide for an unqualified
limitation of such liability to an agreed valuation.
A reading of clauses 1 and 9 of the bill of lading here in question, however, clearly shows
that the present case falls within the third stipulation, to wit: That a clause in a bill of
lading limiting the liability of the carrier to a certain amount unless the shipper declares a
higher value and pays a higher rate of freight, is valid and enforceable. This proposition is
supported by a uniform lien of decisions of the Supreme Court of the United States
rendered both prior and subsequent to the passage of the Harter Act, from the case of
Hart vs. Pennsylvania R. R. Co. (decided Nov. 24, 1884; 112 U. S., 331), to the case of
the Union Pacific Ry. Co. vs. Burke (decided Feb. 28, 1921, Advance Opinions, 1920-1921,
p. 318).
In the case of Hart vs. Pennsylvania R. R. Co., supra, it was held that "where a contract of
carriage, signed by the shipper, is fairly made with a railroad company, agreeing on a
valuation of the property carried, with the rate of freight based on the condition that the
carrier assumes liability only to the extent of the agreed valuation, even in case of loss or
damage by the negligence of the carrier, the contract will be upheld as proper and lawful
mode of securing a due proportion between the amount for which the carrier may be
responsible and the freight he receives, and protecting himself against extravagant and
fanciful valuations."
In the case of Union Pacific Railway Co. vs. Burke, supra, the court said: "In many cases,
from the decision in Hart vs. Pennsylvania R. R. Co. (112 U. S. 331; 28 L. ed., 717; 5 Sup.
Ct. Rep., 151, decided in 1884), to Boston and M. R. Co. vs. Piper (246 U. S., 439; 62 L.
ed., 820; 38 Sup. Ct. Rep., 354; Ann. Cas. 1918 E, 469, decided in 1918), it has been
declared to be the settled Federal law that if a common carrier gives to a shipper the
choice of two rates, the lower of the conditioned upon his agreeing to a stipulated
valuation of his property in case of loss, even by the carrier's negligence, if the shipper
makes such a choice, understandingly and freely, and names his valuation, he cannot
thereafter recover more than the value which he thus places upon his property. As a
matter of legal distinction, estoppel is made the basis of this ruling, — that, having
accepted the benefit of the lower rate, in common honesty the shipper may not repudiate
the conditions on which it was obtained, — but the rule and the effect of it are clearly
established."
The syllabus of the same case reads as follows: "A carrier may not, by a valuation
agreement with a shipper, limit its liability in case of the loss by negligence of an
interstate shipment to less than the real value thereof, unless the shipper is given a choice
of rates, based on valuation."
A limitation of liability based upon an agreed value to obtain a lower rate does not
conflict with any sound principle of public policy; and it is not conformable to plain
principles of justice that a shipper may understate value in order to reduce the rate and
then recover a larger value in case of loss. (Adams Express Co. vs. Croninger 226 U. S.
491, 492.) See also Reid vs. Farbo (130 C. C. A., 285); Jennings vs. Smith (45 C. C.
A., 249); George N. Pierce Co. vs. Wells, Fargo and Co. (227 U. S., 278); Wells, Fargo
& Co. vs. Neiman-Marcus Co. (227 U. S., 469).
It seems clear from the foregoing authorities that the clauses (1 and 9) of the bill of lading
here in question are not contrary to public order. Article 1255 of the Civil Code provides
that "the contracting parties may establish any agreements, terms and conditions they
may deem advisable, provided they are not contrary to law, morals or public order." Said
clauses of the bill of lading are, therefore, valid and binding upon the parties thereto.
II. The question presented by the appeal of the defendant is whether clause 1 or clause 9
of the bill of lading here in question is to be adopted as the measure of defendant's
liability. Clause 1 provides as follows:
1. It is mutually agreed that the value of the goods receipted for above does not
exceed $500 per freight ton, or, in proportion for any part of a ton, unless the value be
expressly stated herein and ad valorem freight paid thereon. Clause 9 provides:
9. Also, that in the even of claims for short delivery of, or damage to, cargo being
made, the carrier shall not be liable for more than the net invoice price plus freight and
insurance less all charges saved, and any loss or damage for which the carrier may be
liable shall be adjusted pro rata on the said basis.
The defendant-appellant contends that these two clauses, if construed together, mean that
the shipper and the carrier stipulate and agree that the value of the goods receipted for
does not exceed $500 per freight ton, but should the invoice value of the goods be less
than $500 per freight ton, then the invoice value governs; that since in this case the
invoice value is more than $500 per freight ton, the latter valuation should be adopted and
that according to that valuation, the proportionate value of the clocks in question is only
P76.36 which the defendant is ready and willing to pay to the plaintiff.
It will be noted, however, that whereas clause 1 contains only an implied undertaking to
settle in case of loss on the basis of not exceeding $500 per freight ton, clause 9 contains
an express undertaking to settle on the basis of the net invoice price plus freight and
insurance less all charges saved. "Any loss or damage for which the carrier may be
liable shall  be adjusted  pro rata on the said basis," clause 9 expressly provides. It seems
to us that there is an irreconcilable conflict between the two clauses with regard to the
measure of defendant's liability. It is difficult to reconcile them without doing violence to
the language used and reading exceptions and conditions into the undertaking contained
in clause 9 that are not there. This being the case, the bill of lading in question should be
interpreted against the defendant carrier, which drew said contract. "A written contract
should, in case of doubt, be interpreted against the party who has drawn the contract." (6
R. C. L. 854.) It is a well-known principle of construction that ambiguity or uncertainty in
an agreement must be construed most strongly against the party causing it. (6 R. C. L.,
855.) These rules as applicable to contracts contained in bills of lading. "In construing a
bill of lading given by the carrier for the safe transportation and delivery of goods shipped
by a consignor, the contract will be construed most strongly against the carrier, and
favorably to the consignor, in case of doubt in any matter of construction." (Alabama, etc.
R. R. Co. vs. Thomas, 89 Ala., 294; 18 Am. St. Rep., 119.)
It follows from all of the foregoing that the judgment appealed from should be affirmed,
without any finding as to costs. So ordered.
G.R. No. L-28028             November 25, 1927
JUAN YSMAEL & CO., INC., plaintiff-appellee,
vs.
GABINO BARRETTO & CO., LTD., ET AL., defendants. ANDRES H. LIMGENGCO and
VICENTE JAVIER, appellants.
Gibbs and McDonough for appellants.
Felipe Ysmael and Grey & Encarnacion for appellee.
STATEMENT
In this action plaintiff, a domestic corporation, seeks to recover from the defendants
P9,940.95 the alleged value of four cases of merchandise which it delivered to the
steamship Andres  on October 25, 1922, at Manila to be shipped to Surigao, but which
were never delivered to Salomon Sharuff, the consignee, or returned to the plaintiff. The
original complaint was amended to include Gabino Barretto and P. E. Soon as members of
the limited partnership of Gabino Barretto & Company, Limited.
In their amended answers defendants make a specific denial of all of the material
allegations of the complaint, and as special defense allege that the four cases of
merchandise in question were never delivered to them, and that under the provisions of
paragraph the provisions of paragraph 7 of the printed conditions appearing on the back of
the bill of lading, plaintiff's right of action is barred for the reason that it was not brought
within sixty days from the time the cause of action accrued. The defendant Soon did not
answer the complaint, and the defendants further alleged:
I. That under and by virtue of provision 12 of the bill of lading referred to in plaintiff's
amended complaint, the defendants are not liable in excess of three hundred pesos
(P300) for any package of silk unless the value and contents of such packages are
correctly declared in the bill of lading at the time of shipment, etc.
The evidence was taken upon such issues, and the lower court rendered judgment for the
plaintiff for the full amount of its claim, from which the defendants Andres H. Limgengco
and Vicente Javier appeal and assign the following errors:
I. The lower court erred in finding that one hundred sixty-four cases of goods were
delivered to and loaded on the steamship Andres.
II. The lower court erred in holding that appellee was not bound by the terms of the
bills of lading of covering the shipments.
III. The trial court erred in failing to take into consideration appellants' special defense
based on clause 12 of the bills of lading.
 IV. The lower court erred in rendering judgment against appellants in the sum of
P9,940.95.
JOHNS, J.:
The only question involved in the first assignment of error is one of fact upon which in its
decision the trial court said:
With regard to the first question, plaintiff's testimony, together with the manifest
(Exhibit D), signed by "G. Barretto, Agents," for Andres Heras Limgengco covering the
shipment of the merchandise in question, wherein 165 cases of merchandise appear as
belonging to the plaintiff corporation and the bills of lading, Exhibits I, J and K, signed
by the second officer, Claro Galleros for the shipment of the 165 cases, and Exhibits H,
which is a triplicate copy of the bill of lading No. 62, on which the first officer of the
steamer Andres, Francisco Masingsong, made a note that among the merchandise
discharged in Surigao were the four cases in question, clearly shows that the
defendants received from the plaintiff corporation 164 cases of merchandise, and
delivered at Surigao only 160 cases of such merchandise, and that defendants failed to
deliver the said four cases in Surigao when plaintiff's representative took delivery of the
cargo at that port, and that the original figure "1" and the word "bulto" appearing on
the back of Exhibit 1 were changed by Galleros to read "5" and "bultos." The said
Galleros admitted as a witness that he had Exhibit 1 in his possession from Manila until
the cargo was recounted in Surigao in the presence of the first officer, Francisco
Masingsong, Salomon Sharuff, the bodeguero  and himself (Galleros).
The testimony of Claro Galleros to the effect that, according to the tallies made by him
on the back of Exhibit 1 during the course of loading, only 160 cases were loaded, on
board the steamer Andres  stands uncorroborated, and it is not supported by the tallies
themselves, as these tallies give a total of 161 cases. Mr. Galleros, testified that he had
shown the annotation on the back of Exhibit 1 reading `5 bultos en duda de menos' to
Salamon Sharuff, and that Salomon Sharuff gave his conformity to the shortage, and
that on this occasion, among others, were present the first officer Francisco
Masingsong, and the bodeguero in Surigao. Upon this point, besides the testimony of
Salomon Sharuff, who denied emphatically the assertion of Galleros just mentioned, we
have the note made and signed by the first officer on the face of Exhibit H that all the
merchandise therein was discharged in Surigao. The said Masingsong certainly would
not have made such annotation after the delivery in Surigao, if Salomon Sharuff had in
fact agreed to the shortage as testified by Galleros, especially when we considered that
the four cases, the value of which is claimed by plaintiff, were included in said Exhibit
H, and the fact that said Claro Galleros, in an affidavit signed by him before the Notary
Public Fernando Viola with regard to the lost of the four cases, did not mention the
conformity of Salomon Sharuff to the said annotation of "5 bultos en duda de menos."
The defendants, without showing any legal reason therefor, did not present as
witnesses the first officer, Francisco Masingsong, and the helmsman of the
steamer Andres and the bodeguero in Surigao to corroborate the testimony of Claro
Galleros.
There is ample evidence to support that finding. In fact it is sustained by a preponderance
of the evidence.
The second assignment of error upon which appellants rely is founded upon paragraph 7 of
the bill of lading, which is as follows:
All claims for shortage or damage must be made at the time of delivery to consignee or
his agent, if the packages or containers show exterior signs of damage; otherwise to be
made in writing to the carrier within twenty-four hours from the time of delivery.
Claims for nondelivery or shipment must be presented in writing to the carrier within
thirty days from the date of accrual. Suits based upon claims arising from shortage,
damage, or nondelivery of shipment shall be instituted within sixty days from date of
accrual of the right of action. Failure to make claims or to institute judicial proceedings
as herein provided shall constitute a waiver of the claim or right of action.
The goods in question were shipped from Manila on October 25, 1922, to be delivered to
Salomon Sharuff in Surigao, Plaintiff's original complaint was filed on April 17, 1923, or a
little less than six months after the shipment was made.
Appellants cite and rely upon section 505 C, Corpus Juris, vol. 10, pp. 343-344, which is
as follows:
Contractual Limitations As to Time For Bringing Suit. — 1. In General. — In the absence
of any express statutory prohibition, according to the great weight of authority, it is
competent for the parties to a contract of shipment to agree on a limitation of time
shorter than the statutory limitation, within which action for breach of the contract shall
be brought, and such a limitation will be enforced if reasonable, although there is some
authority to the contrary. Nevertheless to be effective such limitation must be
reasonable; and it has been said that the only limitations as to the validity of such
contract are that they must be reasonable, and that there must be prompt action on
the part of the carrier in denying its liability, to the end that the shipper may be duly
apprised of the fact that suit will be necessary. Stipulations of this character are not
opposed to public policy, and do not operate as a restriction on the common-law
liability of the carrier.
Also Ruling Case Law, volume 4, pp. 798-799, which reads:
256. Stipulations Limiting Time for Bringing Suit. — Similar in character to the
stipulations just considered prescribing a certain time within which notice of loss must
be given are the provisions frequently met with in bills of lading which require that any
action to recover for loss or damage to the article shipped should be begun within a
specified period. The parties may, if they see fit, fix by agreement a shorter time for
the bringing of suit on the contract than that provided by the statute of limitations, and
if the period therein limited is reasonable, suit must brought within that time or the
shipper's right of action will be barred. Such a provision is prohibited by no rule of law
nor by any consideration of public policy. Nor is it all affected by the existence within
the jurisdiction of a statutory or constitutional prohibition against carriers limiting or
 restricting their common law liability, since it is held that such a stipulation does not in
any way defeat the complete vestiture of the right to recover, but merely requires the
assertion of that right by action at an earlier period than would be necessary to defeat
it through the operation of the ordinary statute of limitations. But the limitation must
be reasonable, and if the period of time specified is such that under the facts of the
particular case the shipper could not with reasonable diligence be enabled to bring suit
before it expired, the attempted limitation is void. Thus, a provision that suit must be
brought within thirty days after the loss or damage occurred has been held
unreasonable where it appeared that the transit might reasonably consume the whole
of that time. A period of forty days has on the other hand been held to be a reasonable
limitation.
Upon that question the trial court said:
Assuming, however, that the above quoted conditions came to the knowledge of the
plaintiff, the Supreme court of the Philippine Islands, has held that such stipulations in
the bill of lading are not reasonable, and therefore, do not bar an action.
And it also said:
Granting, without deciding, that said conditions appearing on the back of the originals
might have legal effect, the court is of the opinion that in view of the fact that said
conditions are not printed on the triplicate copies which were delivered to the plaintiff,
such conditions are not binding upon the plaintiff.
It appears that the plaintiff made its claim of loss within seven days after receipt of
information that 160 cases only were delivered. Its second claim was made on December
29, 1922, in which it said that, if the claim was not paid before January 3, 1923, it would
be placed in the hands of attorneys for collection. On January 3, 1923, Gabino Barretto &
Company advised the plaintiff that it would not pay the claim, and on April seventeenth
plaintiff filed its complaint.
In the case of Aguinaldo vs. Daza (G. R. No. 25961), in which the printed conditions on
the bill of lading were identical with those in the instant case, the action was not
commenced for more than year after the delivery of the goods by the plaintiff and the
receipt of the bill of lading, and it was there held that:
We are of the opinion that, having regard to the situation involved in this shipment,
and the slowness of communication between Manila and Catbalogan, the contractual
limitation stated in this bill of lading with respect to the time for presentation of the
written claim was insufficient. The same considerations are necessarily decisive with
respect to the time required for the institution of judicial action. It results that the
stipulations relied upon by the defendant-appellee constitute no obstacle to the
maintenance of the present action.
All things considered, we are clearly of the opinion that the action was brought with a
"reasonable time" as those words are specified and defined in the authorities cited. It is
true that both the plaintiff and the defendants are residents of the City of Manila, but it is
also true that Surigao where the goods in question were to be delivered is one of the most
distant places from Manila in the Philippine Islands. In the very nature of things, plaintiff
would not want to commence its action until such time as it had made a full and careful
investigation of all of the material facts and even the law of the case, so as to determine
whether or not defendants were liable for its loss.
In its third assignment of error, appellants rely on clause 12 of the bill of lading, which is
as follows:
It is expressly understood that carrier shall not be liable for loss or damage from any
cause or for any reason to an amount exceeding three hundred pesos (P300) Philippine
currency for any single package of silk or other valuable cargo, nor for an amount
exceeding one hundred pesos (P100) Philippine currency for any single package of other
cargo, unless the value and contents of such packages are correctly declared in this bill
of lading at the time of shipment and freight paid in accord with the actual measurement
or weight of the cargo shipped.
That condition is printed on the back of the bill of lading.
In disposing of that question, the lower court points out that the conditions in question
"are not printed on the triplicate copies which were delivered to the plaintiff," and that by
reason thereof they "are not binding upon the plaintiff." The clause in question provides
that the carrier shall not be liable for loss or damage from any cause or for any reason to
an amount in excess of P300 "for any single package of silk or other valuable cargo."
The ship in question was a common carrier and, as such, must have been operated as a
public utility. It is a matter of common knowledge that large quantities of silk are imported
in the Philippine Islands, and that after being imported, they are sold by the merchants in
Manila and other large seaports, and then shipped to different points and places in the
Islands. Hence, there is nothing unusual about the shipment of silk. In truth and in fact, it
is a matter of usual and ordinary business. There was no fraud or concealment in the
shipment in question. Clause 12 above quoted places a limit of P300 "for any single
package of silk." The evidence shows that 164 "cases" were shipped, and that the value of
each case was very near P2,500. In this situation, the limit of defendants' liability for each
case of silk "for loss or damage from any cause or for any reason" would put it in the
power of the defendants to have taken the whole cargo of 164 cases of silk at a valuation
of P300 for each case, or less than one-eight of its actual value. If that rule of law should
be sustained, no silk would ever be shipped from one island to another in the Philippines.
Such a limitation of value is unconscionable and void as against public policy.
Corpus Juris, volume 10, p. 154, says:
PAR. 194. 6. Reasonable of Limitation. — The validity of stipulations limiting the
carriers liability is to be determined by their reasonableness and their conformity to the
sound public policy, in accordance with which the obligations of the carrier to the public
are settled. It cannot lawfully stipulate for exemption from liability, unless such
 exemption is just and reasonable, and unless the contract is freely and fairly made. No
contractual limitation is reasonable which is subversive of public policy.

PAR. 195. 7. What Limitations of Liability Permissible. — a.

Negligence  — (1) Rule in America  — (a) In Absence of Organic or Statutory Provisions
Regulating Subject  — aa. Majority Rule. — In the absence of statute, it is settled by the
weight of authority in the United States, that whatever limitations against its common-
law liability are permissible to a carrier, it cannot limit its liability for injury to or loss of
goods shipped, where such injury or loss is caused by its own negligence. This is the
common-law doctrine and it makes no difference that there is no statutory prohibition
against contracts of this character.

PAR. 196. bb. Considerations on Which Rule Based. — The rule, it is said, rests on

considerations of public policy. The undertaking is to carry the goods, and to relieve the
shipper from all liability for loss or damage arising from negligence in performing its
contract is to ignore the contract itself. The natural effect of a limitation of liability
against negligence is to induce want of care on the part of the carrier in the
performance of its duty. The shipper and the common carrier are not on equal terms;
the shipper must send his freight by the common carrier, or not at all; he is therefore
entirely at the mercy of the carrier, unless protected by the higher power of the law
against being forced into contracts limiting the carrier's liability. Such contracts are
wanting in the element of voluntary assent.

PAR. 197. cc. Application and Extent of Rule  — (aa) Negligence of Servants. — The rule

prohibiting limitation of liability for negligence is often stated as a prohibition of any
contract relieving the carrier from loss or damage caused by its own negligence or
misfeasance, or that of its servants; and it has been specifically decided in many cases
that no contract limitation will relieve the carrier from responsibility for the negligence,
unskillfulness, or carelessness of its employees.

Based upon the findings of fact of the trial court which are sustained by the evidence, the
plaintiff delivered to the defendants 164 cases of silk consigned and to be delivered by the
defendants to Salomon Sharuff in Surigao. Four of such cases were never delivered, and
the evidence shows that their value is the alleged in the complaint.

There is no merit in the appeal. The judgment of the lower court is affirmed, with costs.