THE SPOUSES BERNABE AFRICA and SOLEDAD C.

AFRICA, and the HEIRS OF DOMINGA ONG, petitioners-

appellants,
vs.
CALTEX (PHIL.), INC., MATEO BOQUIREN and THE COURT OF APPEALS, respondents-appellees.

G.R. No. L-12986             March 31, 1966

FACTS:

A fire broke out at the Caltex service station at the corner of Antipolo street and Rizal Avenue, Manila. It started
while gasoline was being hosed from a tank truck into the underground storage, right at the opening of the
receiving tank where the nozzle of the hose was inserted (a lighted matchstick was thrown by a stranger near the
opening, causing the fire). The fire spread to and burned several neighboring houses. Their owners, among them
petitioners here, sued respondents Caltex (Phil.), Inc. and Boquiren, the first as alleged owner of the station and
the second as its agent in charge of operation. Negligence on the part of both of them was attributed as the cause
of the fire.
The trial court and the CA found that petitioners failed to prove negligence and that respondents had exercised
due care in the premises and with respect to the supervision of their employees. Hence this petition.

ISSUE:

Whether or not Caltex should be held liable for the damages caused to appellants.

HELD:

The issue depends on whether Boquiren was an independent contractor, or agent of Caltex. This question, in the
light of the facts not controverted, is one of law and hence may be passed upon by this Court. These facts are: (1)
Boquiren made an admission that he was an agent of Caltex; (2) at the time of the fire Caltex owned the gasoline
station and all the equipment therein; (3) Caltex exercised control over Boquiren in the management of the state;
(4) the delivery truck used in delivering gasoline to the station had the name of CALTEX painted on it; and (5) the
license to store gasoline at the station was in the name of Caltex, which paid the license fees.

Under that agreement Boquiren would pay Caltex the purely nominal sum of P1.00 for the use of the premises and
all the equipment therein. He could sell only Caltex Products. Maintenance of the station and its equipment was
subject to the approval, in other words control, of Caltex. Boquiren could not assign or transfer his rights as
licensee without the consent of Caltex. The license agreement was supposed to be from January 1, 1948 to
December 31, 1948, and thereafter until terminated by Caltex upon two days prior written notice. Caltex could at
any time cancel and terminate the agreement in case Boquiren ceased to sell Caltex products, or did not conduct
the business with due diligence, in the judgment of Caltex. Termination of the contract was therefore a right
granted only to Caltex but not to Boquiren. These provisions of the contract show the extent of the control of
Caltex over Boquiren. The control was such that the latter was virtually an employee of the former.