EN BANC

[ G.R. No. L-23733, October 31, 1969 ]

HERMINIO L. NOCUM, PLAINTIFF-APPELLEE,
VS.
LAGUNA TAYABAS BUS COMPANY, DEFENDANT-APPELLANT.

DECISIONBARREDO, J.:
Appeal of the Laguna Tayabas Bus Co., defendant in the court below, from a
judgment of the said court (Court of First Instance of Batangas) in its Civil
Case No. 834, wherein appellee Herminio L. Nocum was plaintiff, senten cing
appellant to pay appellee the sum of P1,351.00 for actual damages and
P500.00 as attorney's fees, with legal interest from the filing of the complaint
plus costs. Appellee, who was a passenger in appellant's Bus No. 120 then
making a trip within the barrio of Dita, Municipality of Bay, Laguna, was injured
as a consequence of the explosion of firecrackers, contained in a box, loaded
in said bus and declared to its conductor as containing clothes and
miscellaneous items by a co-passenger. The findings of fact of the trial court
are not assailed. The appeal is purely on legal questions.

Appellee has not filed any brief. All that We have before Us is appellant's brief
with the following assignment of errors:

I"BASED ON THE FACTS THE LOWER COURT FOUND AS ESTABLISHED,

IT ERRED AS A MATTER OF LAW IN NOT ABSOLVING APPELLANT FROM
LIABILITY RESULTING FROM THE EXPLOSION OF FIRECRACKERS
CONTAINED IN A PACKAGE, THE CONTENTS OF WHICH WERE
MISREPRESENTED BY A PASSENGER."II

"THE LOWER COURT ERRED, AS A MATTER OF LAW, IN AWARDING

DAMAGES WITH LEGAL INTEREST IN FAVOR OF THE APPELLEE."III

"THE LOWER COURT ERRED IN NOT DISMISSING THE COMPLAINT,

WITH COSTS AGAINST THE APPELLEE."Upon consideration of the points
raised and discussed by appellant, We find the appeal to be well taken.

The main basis of the trial court's decision is that appellant did not observe the
extraordinary or utmost diligence of a very cautious person required by the
following articles of the Civil Code:

"ART. 1733. Common carriers, from the nature of their business and for
reasons of public policy, are bound to observe extraordinary diligence in the
vigilance over the goods and for the safety of the passengers trans ported by
them, according to all the circumstances of each case."Such extraordinary
diligence in the vigilance over the goods is further expressed in articles 1734,
1735, and 1745, Nos. 5, 6, and 7, while the extraordinary diligence for the
safety of the passengers is further set forth in articles 1755 and 1756."ART.
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."ART. 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."
Analyzing the evidence presented by the parties, His Honor found:

"According to Severino Andaya, a witness for the plaintiff, a man with a box
went up the baggage compartment of the bus where he already was and said
box was placed under the seat. They left Azcarraga at about 11:30 in the
morning and when the explosion occured, he was thrown out. PC investigation
report states that thirty seven (37) passengers were injured (Exhibit 'O and
'2')."The bus conductor, Sancho Mendoza, testified that the box belonged to a
passenger whose name he does not know and who told him that it contained
miscellaneous items and clothes. He helped the owner in loading the bag gage
which weighed about twelve (12) kilos and because of company regulation, he
charged him for it twenty-five centavos (P0.25). From its appearance there
was no indication at all that the contents were explosives or firecrackers.
Neither did he open the box because he just relied on the word of the owner.
"Dispatcher Nicolas Cornista of defendant company corroborated the
testimony of Mendoza and he said, among other things, that he was present
when the box was loaded in the truck and the owner agreed to pay its fare. He
added that they were not authorized to open the baggages of passengers
because instruction from the management was to call the police if there were
packages containing articles which were against regulations.x x x x x"There is
no question that Bus No. 120 was road worthy when it left its Manila Terminal
for Lucena that morning of December 5, 1960. The injuries suffered by the
plaintiff were not due to mechanical defects but to the explosion of firecrackers
inside the bus which was loaded by a co-passenger.x x x Turning to the

present case, it is quite clear that extraordinary or utmost diligence of a very

cautious person was not observed by the defendant company. The service
manual, Exhibits '3' and '3-A', prohibits the employees to allow explosives,
such as dynamite and firecrackers to be transported on its buses. To
implement this particular rule for the safety of passengers, it was therefore
incumbent upon the employees of the company to make the proper inspection
of all the baggages which are carried by the passengers."But then, can it not
be said that the breach of the contract was due to fortuitous event? The
Supreme Court in the case of Lasam vs. Smith, 45 Phil. 657, quoted
Escriche's definition of caso fortuito as an unexpected event or act of God
which could neither be foreseen nor resisted, such as floods, torrents,
shipwrecks, conflagrations, lightning, compulsions, insurrections, destructions
of buildings by unforeseen accidents and other occurrences of a similar
nature.' In other words, the cause of the unexpected event must be
independent of the will of man or something which cannot be avoided. This
cannot be said of instant case. If proper and rigid inspection were observed by
the defendant, the contents of the box could have been discovered and the
accident avoided. Refusal by the passenger to have the package opened was
no excuse because, as stated by Dispatcher Cornista, employees should call
the police if there were package containing articles against company
regulations. Neither was failure by employees of defendant company to detect
the contents of the packages of passengers because like the rationale in the
Necesito vs. Paras case (supra), a passenger has neither choice nor control in
the exercise of their discretion in determining what are inside the package of
co-passengers which may eventually prove fatal."We cannot agree. No doubt,
the views of His Honor do seem to be in line with the reasons that the Code
Commission had for incorporating the above-quoted provisions in its draft of
the Civil Code. Indeed, in approving the said draft, Congress must have
concurred with the Commission that by requiring the highest degree of
diligence from common carriers in the safe transport of their passengers and
by creating a presumption of negligence against them, the recklessness of
their drivers which is a common sight even in crowded areas and, particularly,
on the highways throughout the country may, somehow, if not in a large
measure, be curbed. We are not convinced, however, that the exacting
criterion of said provisions has not been met by appellant in the circumstances
of this particular case.

It is undisputed that before the box containing the firecrackers were allowed to
be loaded in the bus by the conductor, inquiry was made with the passenger
carrying the same as to what was in it, since its "opening .. was folded and
tied with abaca." (Decision p. 16, Record on Appeal.) According to His Honor,
"if proper and rigid inspection were observed by the defendant, the contents of
the box could have been discovered and the accident avoided. Refusal by the
passenger to have the package opened was no excuse because, as stated by
Dispatcher Cornista, employees should call the police if there were packages
containing articles against company regulations." That may be true, but it is
Our considered opinion that the law does not require as much. Article 1733 is
not as unbending as His Honor has held, for it reasonably qualifies the
extraordinary diligence required of common carriers for the safety of the
passengers transported by them to be "according to all the circumstances of
each case." In fact, Article 1755 repeats this same qualification: "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
due regard for all the circumstances."

In this particular case before Us, it must be considered that while it is true the
passengers of appellant's bus should not be made to suffer for something over
which they had no control, as enunciated in the decision of this Court cited by
His Honor, fairness demands that in measuring a common carrier's duty
towards its passengers, allowance must be given to the reliance that should be
reposed on the sense of responsibility of all the passengers in re gard to their
common safety. It is to be presumed that a passenger will not take with him
anything dangerous to the lives and limbs of his co-passengers, not to speak
of his own. Not to be lightly considered must be the right to privacy to which
each passenger is entitled. He cannot be subjected to any unusual search,
when he protests the innocuousness of his baggage and nothing appears to
indicate the contrary, as in the case at bar. In other words, in quiry may be
verbally made as to the nature of a passenger's baggage when such is not
outwardly perceptible, but beyond this, constitutional boundaries are already in
danger of being transgressed. Calling a policeman to his aid, as suggested by
the service manual invoked by the trial judge, in compelling the passenger to
submit to more rigid inspection, after the passenger had already declared that
the box contained mere clothes and other miscellanies, could not have justified
invasion of a constitutionally protected domain. Police officers acting without
judicial authority secured in the manner provided by law are not beyond the
pale of constitutional inhibitions designed to protect individual human rights
and liberties. Withal, what must be importantly considered here is not so much
the infringement of the fundamental sacred rights of the particular passenger
herein involved, but the constant threat any contrary ruling would pose on the
right of privacy of all passengers of all common carriers, considering how
easily the duty to inspect can be made an excuse for mischief and abuse. Of
course, when there are sufficient indications that the representations of the
passenger regarding the nature of his baggage may not be true, in the interest
of the common safety of all, the assistance of the police authorities may be
solicited, not necessarily to force the passenger to open his baggage, but to
conduct the needed investigation consistent with the rules of propriety and,
above all, the constitutional rights of the passenger. It is in this sense that the
mentioned service manual issued by appellant to its conductors must be
understood.
1

Decisions in other jurisdictions cited by appellant in its brief, evidently because

of the paucity of local precedents squarely in point, emphasize that there is
need, as We hold here, for evidence of circumstances indicating cause or
causes for apprehension that the passenger's baggage is dangerous and that
it is failure of the common carrier's employee to act in the face of such
evidence that constitutes the cornerstone of the common carrier's liability in
cases similar to the present one.

"The principle that must control the servants of the carrier in a case like the
one before us is correctly stated in the opinion in the case of Clarke v.
Louisville & N.R. Co. 20 Ky. L. Rep. 839, 49 S. W. 1120. In that case Clarke
was a passenger on the defendant's train. Another passenger took a quantity
of gasoline into the same coach in which Clarke was riding. It ignited and
exploded, by reason of which he was severely injured. The trial court
peremptorily instructed the jury to find for the defendant. In the opinion,
affirming the judgment, it is said: 'It may be stated briefly, in assuming the
liability of a railroad to its passengers for injury done by another passenger,
only where the conduct of this passenger had been such before the injury as
to induce a reasonably prudent and vigilant conductor to believe that there was
reasonable ground to apprehend violence and danger to the other passengers,
and in that case asserting it to be the duty of the conductor of the railroad train
to use all reasonable means to prevent such injury, and if he neglects this
reasonable duty, and injury is done, that then the company is responsible; that
otherwise the railroad is not responsible.'"The opinion quotes with approval
from the case of Gulf, C. & S. F. R. Co. vs. Shields, 9 Tex. Civ. App. 652, 29 S.
W. 652, in which case the plaintiff was injured by alcohol which had been
carried upon the train by another passenger. In the opinion in that case it is
said: 'It was but a short period of time after the alcohol was spilt when it was
set on fire and the accident occurred, and it was not shown that appel lant's
employees knew that the jug contained alcohol. In fact, it is not shown that the
conductor or any other employee knew that Harris had a jug with him until it
fell out of the sack, though the conductor had collected (his) fare, and
doubtless knew that he had the sack on the seat with him ... It cannot be
successfully denied that Harris had the right as a passenger to carry baggage
on the train, and that he had a right to carry it in a sack if he chose to do so.
We think it is equally clear that, in the absence of some intimation or
circumstance indicating that the sack contained something dangerous to other
passengers, it was not the duty of appellant's conductor or any other employee
to open the sack and examine its contents.' Quinn v. Louisville & N. R. Co. 98
Ky. 231, 32 S. W. 742; Wood v. Louisville & N. R. Co. 101 Ky. 703, 42 S. W.
349; Louisville & N. R. Co. v. Vincent, 29 Ky. L. Rep. 1049, 96 S. W. 898;
Louisville & N. R. Co. v. Renfro, 142 Ky. 590, 33 L. R. A. (N. S.) 133, 135 S. W.
266." (Underscoring supplied.)"Explosive or Dangerous Contents. - A carrier is
ordinarily not liable for injuries to passengers from fires or explosions caused
by articles brought into its conveyances by other passengers, in the absence
of any evidence that the carrier, through its employees, was aware of the
nature of the article or had any reason to anticipate danger therefrom. (Bogard
v. Illinois C. R. Co. 144 Ky. 649, 139 S. W. 855, 36 L. R. A. [N. S.] 337; Clarke
v. Louisville & N. R. Co. 101 Ky. 34, 39 S. W. 840, 36 L. R. A. 123 [explosion of
can of gasoline]; East Indian R. Co. v. Mukerjee [1901] A. C. [Eng.] 396, 3 B.
R. C. 420 - P. C. [explosion of fireworks]; Annotation: 37 L. R. A. [N. S.] 725.)"
Appellant further invokes Article 1174 of the Civil Code which relieves all
obligors, including, of course, common carriers like appellant, from the
consequence of fortuitous events. The court a quo held that "the breach of
contract (in this case) was not due to fortuitous event and that, therefore, the
defendant is liable in damages." Since We hold that appellant has succeeded
in rebutting the presumption of negligence by showing that it has exercised
extraordinary diligence for the safety of its passengers, "according to the
circumstances of the (each) case", We deem it unnecessary to rule whether or
not there was any fortuitous event in this case.

ACCORDINGLY, the appealed judgment of the trial court is reversed and the
case is dismissed, without costs.

Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez, and

Fernando, JJ., concur.Castro, J., in the result.Teehankee, J., reserves his vote.

SECOND DIVISION
[ G.R. No. 110398, November 07, 1997 ]
NEGROS NAVIGATION CO., INC., PETITIONER,
VS.
THE COURT OF APPEALS, RAMON MIRANDA, SPS. RICARDO
AND VIRGINIA DE LA VICTORIA, RESPONDENTS.

DECISIONMENDOZA, J.:

This is a petition for review on certiorari of the decision of the Court of Appeals
affirming with modification the Regional Trial Courts award of damages to
private respondents for the death of relatives as a result of the sinking of
petitioners vessel.

In April of 1980, private respondent Ramon Miranda purchased from the

Negros Navigation Co., Inc. four special cabin tickets (#74411, 74412, 74413
and 74414) for his wife, daughter, son and niece who were going to Bacolod
City to attend a family reunion. The tickets were for Voyage No. 457-A of the
M/V Don Juan, leaving Manila at 1:00 p.m. on April 22, 1980.

The ship sailed from the port of Manila on schedule.

At about 10:30 in the evening of April 22, 1980, the Don Juan collided off the
Tablas Strait in Mindoro, with the M/T Tacloban City, an oil tanker owned by the
Philippine National Oil Company (PNOC) and the PNOC Shipping and
Transport Corporation (PNOC/STC). As a result, the M/V Don Juan sank.
Several of her passengers perished in the sea tragedy. The bodies of some of
the victims were found and brought to shore, but the four members of private
respondents families were never found.

Private respondents filed a complaint on July 16, 1980 in the Regional Trial
Court of Manila, Branch 34, against the Negros Navigation, the Philippine
National Oil Company (PNOC), and the PNOC Shipping and Transport
Corporation (PNOC/STC), seeking damages for the death of Ardita de la
Victoria Miranda, 48, Rosario V. Miranda, 19, Ramon V. Miranda, Jr., 16, and
Elfreda de la Victoria, 26.

In its answer, petitioner admitted that private respondents purchased ticket

numbers 74411, 74412, 74413 and 74414; that the ticket numbers were listed
in the passenger manifest; and that the Don Juan left Pier 2, North Harbor,
Manila on April 22, 1980 and sank that night after being rammed by the oil
tanker M/T Tacloban City, and that, as a result of the collision, some of the
passengers of the M/V Don Juan died. Petitioner, however, denied that the
four relatives of private respondents actually boarded the vessel as shown by
the fact that their bodies were never recovered. Petitioner further averred that
the Don Juan was seaworthy and manned by a full and competent crew, and
that the collision was entirely due to the fault of the crew of the M/T Tacloban
City.

On January 20, 1986, the PNOC and petitioner Negros Navigation Co., Inc.
entered into a compromise agreement whereby petitioner assumed full
responsibility for the payment and satisfaction of all claims arising out of or in
connection with the collision and releasing the PNOC and the PNOC/STC from
any liability to it. The agreement was subsequently held by the trial court to be
binding upon petitioner, PNOC and PNOC/STC. Private respondents did not
join in the agreement.

After trial, the court rendered judgment on February 21, 1991, the dispositive
portion of which reads as follows:WHEREFORE, in view of the foregoing,
judgment is hereby rendered in favor of the plaintiffs, ordering all the
defendants to pay jointly and severally to the plaintiffs damages as follows:

To Ramon Miranda:

P42,025.00 for actual damages;

P152,654.55 as compensatory damages for loss of earning capacity of his
wife;
P90,000.00 as compensatory damages for wrongful death of three (3) victims;
P300,000.00 as moral damages;
P50,000.00 as exemplary damages, all in the total amount of P634,679.55;
and
P40,000.00 as attorneys fees.
To Spouses Ricardo and Virginia de la Victoria:
P12,000.00 for actual damages;
P158,899.00 as compensatory damages for loss of earning capacity;
P30,000.00 as compensatory damages for wrongful death;
P100,000.00 as moral damages;
P20,000.00 as exemplary damages, all in the total amount of P320,899.00;
and
P15,000.00 as attorneys fees.On appeal, the Court of Appeals affirmed the
decision of the Regional Trial Court with modification
1. Ordering and sentencing defendants-appellants, jointly and severally, to pay
plaintiff-appellee Ramon Miranda the amount of P23,075.00 as actual
damages instead of P42,025.00;
2. Ordering and sentencing defendants-appellants, jointly and severally, to pay
plaintiff-appellee Ramon Miranda the amount of P150,000.00, instead of
P90,000.00, as compensatory damages for the death of his wife and two
children;
3. Ordering and sentencing defendants-appellants, jointly and severally, to pay
plaintiffs-appellees Dela Victoria spouses the amount of P50,000.00, instead
2

of P30,000.00, as compensatory damages for the death of their daughter

Elfreda Dela Victoria;

Hence this petition, raising the following issues:

(1) whether the members of private respondents families were actually

passengers of the Don Juan;

(2) whether the ruling in Mecenas v. Court of Appeals, finding the crew
members of petitioner to be grossly negligent in the performance of their
duties, is binding in this case;

(3) whether the total loss of the M/V Don Juan extinguished petitioners
liability; and

(4) whether the damages awarded by the appellate court are excessive,
unreasonable and unwarranted.

First. The trial court held that the fact that the victims were passengers of the
M/V Don Juan was sufficiently proven by private respondent Ramon Miranda,
who testified that he purchased tickets numbered 74411, 74412, 74413, and
74414 at P131.30 each from the Makati office of petitioner for Voyage No. 47A of the M/V Don Juan, which was leaving Manila on April 22, 1980. This was
corroborated by the passenger manifest (Exh. E) on which the numbers of the
tickets and the names of Ardita Miranda and her children and Elfreda de la
Victoria appear.

Petitioner contends that the purchase of the tickets does not necessarily mean
that the alleged victims actually took the trip. Petitioner asserts that it is
common knowledge that passengers purchase tickets in advance but do not
actually use them. Hence, private respondent should also prove the presence
of the victims on the ship. The witnesses who affirmed that the victims were on
the ship were biased and unreliable.

This contention is without merit. Private respondent Ramon Miranda testified

that he personally took his family and his niece to the vessel on the day of the
voyage and stayed with them on the ship until it was time for it to leave. There
is no reason he should claim members of his family to have perished in the
accident just to maintain an action. People do not normally lie about so grave a
matter as the loss of dear ones. It would be more difficult for private
respondents to keep the existence of their relatives if indeed they are alive
than it is for petitioner to show the contrary. Petitioners only proof is that the
bodies of the supposed victims were not among those recovered from the site
of the mishap. But so were the bodies of the other passengers reported
missing not recovered, as this Court noted in the Mecenas case.

Private respondent Mirandas testimony was corroborated by Edgardo

Ramirez. Ramirez was a seminarian and one of the survivors of the collision.
He testified that he saw Mrs. Miranda and Elfreda de la Victoria on the ship
and that he talked with them. He knew Mrs. Miranda who was his teacher in
the grade school. He also knew Elfreda who was his childhood friend and
townmate. Ramirez said he was with Mrs. Miranda and her children and niece
from 7:00 p.m. until 10:00 p.m. when the collision happened and that he in fact
had dinner with them. Ramirez said he and Elfreda stayed on the deck after
dinner and it was there where they were jolted by the collision of the two
vessels. Recounting the moments after the collision, Ramirez testified that
Elfreda ran to fetch Mrs. Miranda. He escorted her to the room and then tried
to go back to the deck when the lights went out. He tried to return to the cabin
but was not able to do so because it was dark and there was a stampede of
passengers from the deck.

Petitioner casts doubt on Ramirez testimony, claiming that Ramirez could not
have talked with the victims for about three hours and not run out of stories to
tell, unless Ramirez had a storehouse of stories. But what is incredible about
acquaintances thrown together on a long journey staying together for hours on
end, in idle conversation precisely to while the hours away?

Petitioner also points out that it took Ramirez three (3) days before he finally
contacted private respondent Ramon Miranda to tell him about the fate of his
family. But it is not improbable that it took Ramirez three days before calling on
private respondent Miranda to tell him about the last hours of Mrs. Miranda
and her children and niece, in view of the confusion in the days following the
collision as rescue teams and relatives searched for survivors.

Indeed, given the facts of this case, it is improper for petitioner to even suggest
that private respondents relatives did not board the ill-fated vessel and perish
in the accident simply because their bodies were not recovered.

Second. In finding petitioner guilty of negligence and in failing to exercise the

extraordinary diligence required of it in the carriage of passengers, both the
trial court and the appellate court relied on the findings of this Court in
Mecenas v. Intermediate Appellate Court, which case was brought for the
death of other passengers. In that case it was found that although the
proximate cause of the mishap was the negligence of the crew of the M/T
Tacloban City, the crew of the Don Juan was equally negligent as it found that
the latters master, Capt. Rogelio Santisteban, was playing mahjong at the
time of collision, and the officer on watch, Senior Third Mate Rogelio De Vera,
admitted that he failed to call the attention of Santisteban to the imminent
danger facing them. This Court found that Capt. Santisteban and the crew of
the M/V Don Juan failed to take steps to prevent the collision or at least delay
the sinking of the ship and supervise the abandoning of the ship.

Petitioner Negros Navigation was found equally negligent in tolerating the

playing of mahjong by the ship captain and other crew members while on
board the ship and failing to keep the M/V Don Juan seaworthy so much so
that the ship sank within 10 to 15 minutes of its impact with the M/T Tacloban
City.

In addition, the Court found that the Don Juan was overloaded. The Certificate
of Inspection, dated August 27, 1979, issued by the Philippine Coast Guard
Commander at Iloilo City stated that the total number of persons allowed on
the ship was 864, of whom 810 are passengers, but there were actually 1,004
on board the vessel when it sank, 140 persons more than the maximum
number that could be safely carried by it.

Taking these circumstances together, and the fact that the M/V Don Juan, as
the faster and better-equipped vessel, could have avoided a collision with the
PNOC tanker, this Court held that even if the Tacloban City had been at fault
for failing to observe an internationally-recognized rule of navigation, the Don
Juan was guilty of contributory negligence. Through Justice Feliciano, this
Court held:

The grossness of the negligence of the Don Juan is underscored when one
considers the foregoing circumstances in the context of the following facts:
Firstly, the Don Juan was more than twice as fast as the Tacloban City. The
Don Juans top speed was 17 knots; while that of the Tacloban City was
6.3. knots. Secondly, the Don Juan carried the full complement of officers
and crew members specified for a passenger vessel of her class. Thirdly, the
Don Juan was equipped with radar which was functioning that night. Fourthly,
the Don Juans officer on-watch had sighted the Tacloban City on his radar
screen while the latter was still four (4) nautical miles away. Visual
confirmation of radar contact was established by the Don Juan while the
Tacloban City was still 2.7 miles away. In the total set of circumstances which
existed in the instant case, the Don Juan, had it taken seriously its duty of
extraordinary diligence, could have easily avoided the collision with the
Tacloban City. Indeed, the Don Juan might well have avoided the collision
even if it had exercised ordinary diligence merely.

It is true that the Tacloban City failed to follow Rule 18 of the International
Rules of the Road which requires two (2) power-driven vessels meeting end
on or nearly end on each to alter her course to starboard (right) so that each
vessel may pass on the port side (left) of the other. The Tacloban City, when
the two (2) vessels were only three-tenths (0.3) of a mile apart, turned (for the
second time) 15o to port side while the Don Juan veered hard to
starboard. . . . [But] route observance of the International Rules of the Road
will not relieve a vessel from responsibility if the collision could have been
avoided by proper care and skill on her part or even by a departure from the
rules.

In the petition at bar, the Don Juan having sighted the Tacloban City when it
was still a long way off was negligent in failing to take early preventive action
and in allowing the two (2) vessels to come to such close quarters as to render
the collision inevitable when there was no necessity for passing so near to the
Tacloban City as to create that hazard or inevitability, for the Don Juan
could choose its own distance. It is noteworthy that the Tacloban City, upon
turning hard to port shortly before the moment of collision, signalled its
intention to do so by giving two (2) short blasts with its horn. The Don Juan
gave no answering horn blast to signal its own intention and proceeded to turn
hard to starboard.

We conclude that Capt. Santisteban and Negros Navigation are properly held
liable for gross negligence in connection with the collision of the Don Juan
and Tacloban City and the sinking of the Don Juan leading to the death of
hundreds of passengers. . . .Petitioner criticizes the lower courts reliance on
the Mecenas case, arguing that, although this case arose out of the same
incident as that involved in Mecenas, the parties are different and trial was
conducted separately. Petitioner contends that the decision in this case should
be based on the allegations and defenses pleaded and evidence adduced in it
or, in short, on the record of this case.

The contention is without merit. What petitioner contends may be true with
3

respect to the merits of the individual claims against petitioner but not as to the
cause of the sinking of its ship on April 22, 1980 and its liability for such
accident, of which there can only be one truth. Otherwise, one would be
subscribing to the sophistry: truth on one side of the Pyrenees, falsehood on
the other!

Adherence to the Mecenas case is dictated by this Courts policy of

maintaining stability in jurisprudence in accordance with the legal maxim stare
decisis et non quieta movere (Follow past precedents and do not disturb what
has been settled.) Where, as in this case, the same questions relating to the
same event have been put forward by parties similarly situated as in a
previous case litigated and decided by a competent court, the rule of stare
decisis is a bar to any attempt to relitigate the same issue. In Woulfe v.
Associated Realties Corporation, the Supreme Court of New Jersey held that
where substantially similar cases to the pending case were presented and
applicable principles declared in prior decisions, the court was bound by the
principle of stare decisis. Similarly, in State ex rel. Tollinger v. Gill, it was held
that under the doctrine of stare decisis a ruling is final even as to parties who
are strangers to the original proceeding and not bound by the judgment under
the res judicata doctrine. The Philadelphia court expressed itself in this wise:
Stare decisis simply declares that, for the sake of certainty, a conclusion
reached in one case should be applied to those which follow, if the facts are
substantially the same, even though the parties may be different. Thus, in J.
M. Tuason v. Mariano, supra, this Court relied on its rulings in other cases
involving different parties in sustaining the validity of a land title on the
principle of stare decisis et non quieta movere.

Indeed, the evidence presented in this case was the same as those presented
in the Mecenas case, to wit:

DocumentMecenas caseThis caseDecision of CommandantPhil. Coast Guard

in BMI Case No. 415-80 dated 3/26/81Exh. 10

Exh. 11-B-NN/XDecision of the Minister of National Defense dated 3/12/82

Exh. 11Exh. ZZResolution on the motion for reconsideration of the decision of
the Minister of National Defense dated 7/24/84

Exh. 13

Exh. AAA (private respondents)

Certificate of inspection dated 8/27/79Exh. 1-AExh. 19-NNCertificate of

Stability dated 12/16/76Exh. 6-AExh. 19-D-NN

Nor is it true that the trial court merely based its decision on the Mecenas
case. The trial court made its own independent findings on the basis of the
testimonies of witnesses, such as Senior Third Mate Rogelio de Vera, who
incidentally gave substantially the same testimony on petitioners behalf before
the Board of Marine Inquiry. The trial court agreed with the conclusions of the
then Minister of National Defense finding both vessels to be negligent.

Third. The next issue is whether petitioner is liable to pay damages

notwithstanding the total loss of its ship. The issue is not one of first
impression. The rule is well-entrenched in our jurisprudence that a shipowner
may be held liable for injuries to passengers notwithstanding the exclusively
real and hypothecary nature of maritime law if fault can be attributed to the
shipowner.

In Mecenas, this Court found petitioner guilty of negligence in (1) allowing or

tolerating the ship captain and crew members in playing mahjong during the
voyage, (2) in failing to maintain the vessel seaworthy and (3) in allowing the
ship to carry more passengers than it was allowed to carry. Petitioner is,
therefore, clearly liable for damages to the full extent.

Fourth. Petitioner contends that, assuming that the Mecenas case applies,
private respondents should be allowed to claim only P43,857.14 each as moral
damages because in the Mecenas case, the amount of P307,500.00 was
awarded to the seven children of the Mecenas couple. Under petitioners
formula, Ramon Miranda should receive P43,857.14, while the De la Victoria
spouses should receive P97,714.28.

Here is where the principle of stare decisis does not apply in view of
differences in the personal circumstances of the victims. For that matter,
differentiation would be justified even if private respondents had joined the

private respondents in the Mecenas case. The doctrine of stare decisis works
as a bar only against issues litigated in a previous case. Where the issue
involved was not raised nor presented to the court and not passed upon by the
court in the previous case, the decision in the previous case is not stare
decisis of the question presently presented. The decision in the Mecenas case
relates to damages for which petitioner was liable to the claimants in that case.

In the case at bar, the award of P300,000.00 for moral damages is reasonable
considering the grief petitioner Ramon Miranda suffered as a result of the loss
of his entire family. As a matter of fact, three months after the collision, he
developed a heart condition undoubtedly caused by the strain of the loss of his
family. The P100,000.00 given to Mr. and Mrs. de la Victoria is likewise
reasonable and should be affirmed.

As for the amount of civil indemnity awarded to private respondents, the

appellate courts award of P50,000.00 per victim should be sustained. The
amount of P30,000.00 formerly set in De Lima v. Laguna Tayabas Co., Heirs of
Amparo delos Santos v. Court of Appeals, and Philippine Rabbit Bus Lines,
Inc. v. Intermediate Appellate Court as benchmark was subsequently
increased to P50,000.00 in the case of Sulpicio Lines, Inc. v. Court of Appeals,
which involved the sinking of another interisland ship on October 24, 1988.

We now turn to the determination of the earning capacity of the victims. With
respect to Ardita Miranda, the trial court awarded damages computed as
follows:

In the case of victim Ardita V. Miranda whose age at the time of the accident
was 48 years, her life expectancy was computed to be 21.33 years, and
therefore, she could have lived up to almost 70 years old. Her gross earnings
for 21.33 years based on P10,224.00 per annum, would be P218,077.92.
Deducting therefrom 30% as her living expenses, her net earnings would be
P152,654.55, to which plaintiff Ramon Miranda is entitled to compensatory
damages for the loss of earning capacity of his wife. In considering 30% as the
living expenses of Ardita Miranda, the Court takes into account the fact that
plaintiff and his wife were supporting their daughter and son who were both
college students taking Medicine and Law respectively.In accordance with the
ruling in Villa-Rey Transit, Inc. v. Court of Appeals, we think the life expectancy
of Ardita Miranda was correctly determined to be 21.33 years, or up to age 69.
Petitioner contends, however, that Mrs. Miranda would have retired from her
job as a public school teacher at 65, hence her loss of earning capacity should
be reckoned up to 17.33 years only.

The accepted formula for determining life expectancy is 2/3 multiplied by (80
minus the age of the deceased). It may be that in the Philippines the age of
retirement generally is 65 but, in calculating the life expectancy of individuals
for the purpose of determining loss of earning capacity under Art. 2206(1) of
the Civil Code, it is assumed that the deceased would have earned income
even after retirement from a particular job. In this case, the trial court took into
account the fact that Mrs. Miranda had a masters degree and a good prospect
of becoming principal of the school in which she was teaching. There was
reason to believe that her income would have increased through the years and
she could still earn more after her retirement, e.g., by becoming a consultant,
had she not died. The gross earnings which Mrs. Miranda could reasonably be
expected to earn were it not for her untimely death was, therefore, correctly
computed by the trial court to be P218,077.92 (given a gross annual income of
P10,224.00 and life expectancy of 21.33 years).

Petitioner contends that from the amount of gross earnings, 60% should be
deducted as necessary living expenses, not merely 30% as the trial court
allowed. Petitioner contends that 30% is unrealistic, considering that Mrs.
Mirandas earnings would have been subject to taxes, social security
deductions and inflation.

We agree with this contention. In Villa-Rey Transit, Inc. v. Court of Appeals, the
Court allowed a deduction of P1,184.00 for living expenses from the P2,184.00
annual salary of the victim, which is roughly 54.2% thereof. The deceased was
29 years old and a training assistant in the Bacnotan Cement Industries. In
People v. Quilaton, the deceased was a 26-year old laborer earning a daily
wage. The court allowed a deduction of P120,000.00 which was 51.3% of his
annual gross earnings of P234,000.00. In People v. Teehankee, the court
allowed a deduction of P19,800.00, roughly 42.4% thereof from the
deceaseds annual salary of P46,659.21. The deceased, Maureen Hultman,
was 17 years old and had just received her first paycheck as a secretary. In
the case at bar, we hold that a deduction of 50% from Mrs. Mirandas gross
earnings (P218,077.92) would be reasonable, so that her net earning capacity
should be P109,038.96. There is no basis for supposing that her living
expenses constituted a smaller percentage of her gross income than the living
expenses in the decided cases. To hold that she would have used only a small
part of her income for herself, a larger part going to the support of her children
would be conjectural and unreasonable.

As for Elfreda de la Victoria, the trial court found that, at the time of her death,
she was 26 years old, a teacher in a private school in Malolos, Bulacan,
4

earning P6,192.00 per annum. Although a probationary employee, she had

already been working in the school for two years at the time of her death and
she had a general efficiency rating of 92.85% and it can be presumed that, if
not for her untimely death, she would have become a regular teacher. Hence,
her loss of earning capacity is P111,456.00, computed as follows:

net earning capacity (x) = life expectancy x[ gross annual income less
reasonable & necessary living expenses (50%) ]x = [ 2 (80-26) ] x[P6,192.00 P3,096.00]3= 36 x 3,096.00= P111,456.00

On the other hand, the award of actual damages in the amount of P23,075.00
was determined by the Court of Appeals on the basis of receipts submitted by
private respondents. This amount is reasonable considering the expenses
incurred by private respondent Miranda in organizing three search teams to
look for his family, spending for transportation in going to places such as
Batangas City and Iloilo, where survivors and the bodies of other victims were
found, making long distance calls, erecting a monument in honor of the four
victims, spending for obituaries in the Bulletin Today and for food, masses and
novenas.

Petitioners contention that the expenses for the erection of a monument and
other expenses for memorial services for the victims should be considered
included in the indemnity for death awarded to private respondents is without
merit. Indemnity for death is given to compensate for violation of the rights of
the deceased, i.e., his right to life and physical integrity. On the other hand,
damages incidental to or arising out of such death are for pecuniary losses of
the beneficiaries of the deceased.

As for the award of attorneys fees, we agree with the Court of Appeals that the
amount of P40,000.00 for private respondent Ramon Miranda and P15,000.00
for the de la Victoria spouses is justified. The appellate court correctly held:
The Mecenas case cannot be made the basis for determining the award for
attorneys fees. The award would naturally vary or differ in each case. While it
is admitted that plaintiff-appellee Ramon Miranda who is himself a lawyer,
represented also plaintiffs-appellees Dela Victoria spouses, we note that
separate testimonial evidence were adduced by plaintiff-appellee Ramon
Miranda (TSN, February 26, 1982, p. 6) and plaintiffs-appellees spouses Dela
Victoria (TSN, August 13, 1981, p. 43). Considering the amount of work and
effort put into the case as indicated by the voluminous transcripts of
stenographic notes, we find no reason to disturb the award of P40,000.00 for
plaintiff-appellee Ramon Miranda and P15,000.00 for plaintiffs-appellees Dela
Victoria spouses.The award of exemplary damages should be increased to
P300,000.00 for Ramon Miranda and P100,000.00 for the de la Victoria
spouses in accordance with our ruling in the Mecenas case:Exemplary
damages are designed by our civil law to permit the courts to reshape
behaviour that is socially deleterious in its consequence by creating negative
incentives or deterrents against such behaviour. In requiring compliance with
the standard of extraordinary diligence, a standard which is in fact that of the
highest possible degree of diligence, from common carriers and in creating a
presumption of negligence against them, the law seeks to compel them to
control their employees, to tame their reckless instincts and to force them to
take adequate care of human beings and their property. The Court will take
judicial notice of the dreadful regularity with which grievous maritime disasters
occur in our waters with massive loss of life. The bulk of our population is too
poor to afford domestic air transportation. So it is that notwithstanding the
frequent sinking of passenger vessels in our waters, crowds of people
continue to travel by sea. This Court is prepared to use the instruments given
to it by the law for securing the ends of law and public policy. One of those
instruments is the institution of exemplary damages; one of those ends, of
special importance in an archipelagic state like the Philippines, is the safe and
reliable carriage of people and goods by sea.WHEREFORE, the decision of
the Court of Appeals is AFFIRMED with modification and petitioner is
ORDERED to pay private respondents damages as follows:

To private respondent Ramon Miranda:

P23,075.00 for actual damages;
P109,038.96 as compensatory damages for loss of earning capacity of his
wife; P150,000.00 as compensatory damages for wrongful death of three (3)
victims;
P300,000.00 as moral damages;
P300,000.00 as exemplary damages, all in the total amount of P882,113.96;
and
P40,000.00 as attorneys fees.
To private respondents Spouses Ricardo and Virginia de la Victoria:
P12,000.00 for actual damages;
P111,456.00 as compensatory damages for loss of earning capacity;
P50,000.00 as compensatory damages for wrongful death;
P100,000.00 as moral damages;
P100,000.00 as exemplary damages, all in the total amount of P373,456.00;
and
P15,000.00 as attorneys fees.
Petitioners are further ordered to pay costs of suit.

In the event the Philippine National Oil Company and/or the PNOC Shipping

and Transport Corporation pay or are required to pay all or a portion of the
amounts adjudged, petitioner Negros Navigation Co., Inc. shall reimburse
either of them such amount or amounts as either may have paid, and in the
event of failure of Negros Navigation Co., Inc., to make the necessary
reimbursement, PNOC and/or PNOC/STC shall be entitled to a writ of
execution without need of filing another action.SO ORDERED.

Regalado, (Chairman), and Puno, JJ., concur.

FIRST DIVISION
[ G.R. No. 114061, August 03, 1994 ]

KOREAN AIRLINES CO., LTD., PETITIONER,

VS.
COURT
OF
APPEALS
RESPONDENTS.

AND

JUANITO

C.

LAPUZ,

[G.R. NO. 113842. AUGUST 03, 1994]

JUANITO C. LAPUZ, PETITIONER,

VS.

COURT OF APPEALS
RESPONDENTS.

AND

KOREAN

AIRLINES

CO.,

LTD.,

DECISIONCRUZ, J.:

Sometime in 1980, Juanito C. Lapuz, an automotive electrician, was

contracted for employment in Jeddah, Saudi Arabia, for a period of one year
through Pan Pacific Overseas Recruiting Services, Inc. Lapuz was supposed
to leave on November 8, 1980, via Korean Airlines. Initially, he was "waitlisted," which meant that he could only be accommodated if any of the
confirmed passengers failed to show up at the airport before departure. When
two of such passengers did not appear, Lapuz and another person by the
name of Perico were given the two unclaimed seats.

According to Lapuz, he was allowed to check in with one suitcase and one
shoulder bag at the check-in counter of KAL. He passed through the customs
and immigration sections for routine check-up and was cleared for departure
as Passenger No. 157 of KAL Flight No. KE 903. Together with the other
passengers, he rode in the shuttle bus and proceeded to the ramp of the KAL
aircraft for boarding. However, when he was at the third or fourth rung of the
stairs, a KAL officer pointed to him and shouted "Down! Down!" He was thus
barred from taking the flight. When he later asked for another booking, his
ticket was canceled by KAL. Consequently, he was unable to report for his
work in Saudi Arabia within the stipulated 2-week period and so lost his
employment.

KAL, on the other hand, alleged that on November 8, 1980, Pan Pacific
Recruiting Services Inc. coordinated with KAL for the departure of 30 contract
workers, of whom only 21 were confirmed and 9 were wait-listed passengers.
The agent of Pan Pacific, Jimmie Joseph, after being informed that there was
a possibility of having one or two seats becoming available, gave priority to
Perico, who was one of the supervisors of the hiring company in Saudi Arabia.
The other seat was won through lottery by Lapuz. However, only one seat
became available and so, pursuant to the earlier agreement that Perico was to
be given priority, he alone was allowed to board.

After trial, the Regional Trial Court of Manila, Branch 30, adjudged KAL liable
for damages, disposing as follows:

WHEREFORE, in view of the foregoing consideration, judgment is hereby

rendered sentencing the defendant Korean Air Lines to pay plaintiff Juanito C.
Lapuz the following:1. The amount of TWO HUNDRED SEVENTY-TWO
THOUSAND ONE HUNDRED SIXTY (P272,160.00) PESOS as actual/
compensatory damages, with legal interest thereon from the date of the filing
of the complaint until fully paid.2. The sum of TWENTY-FIVE THOUSAND
(P25,000.00) PESOS as and for attorney's fees; and3. The costs of suit.The
case is hereby dismissed with respect to defendant Pan Pacific Overseas
5

Recruiting Services, Inc.The counterclaims and cross-claim of defendant

Korean Air Lines Co., Ltd. are likewise dismissed.On appeal, this decision was
modified by the Court of Appeals as follows:

WHEREFORE, in view of all the foregoing, the appealed judgment is hereby

AFFIRMED with the following modifications: the amount of actual damages
and compensatory damages is reduced to P60,000.00 and defendantappellant is hereby ordered to pay plaintiff-appellant the sum of One Hundred
Thousand Pesos (P100,000.00) by way of moral and exemplary damages, at
6% interest per annum from the date of the filing of the Complaint until fully
paid.KAL and Lapuz filed their respective motions for reconsideration, which
were both denied for lack of merit. Hence, the present petitions for review
which have been consolidated because of the identity of the parties and the
similarity of the issues.

In G.R. No. 114061, KAL assails the decision of the appellate court on the
following grounds:

1. That the Court of Appeals erred in concluding that petitioner committed a

breach of contract of carriage notwithstanding lack of proper, competent and
sufficient evidence of the existence of such contract.2. That the Court of
Appeals erred in not according the proper evidentiary weight to some evidence
presented and the fact that private respondent did not have any boarding pass
to prove that he was allowed to board and to prove that his airline ticket was
confirmed.3. That the Court of Appeals erred in concluding that the standby
passenger status of private respondent Lapuz was changed to a confirmed
status when his name was entered into the passenger manifest. 4. That the
Court of Appeals abused its discretion in awarding moral and exemplary
damages in the amount of P100,000.00 in favor of private respondent
notwithstanding its lack of basis and private respondent did not state such
amount in his complaint nor had private respondent proven the said damages.
5. That the Court of Appeals erred in dismissing the counterclaims.6. That the
Court of Appeals erred in dismissing the counterclaim of petitioner against Pan
Pacific.7. That the Court of Appeals erred in ruling that the 6% per annum legal
interest on the judgment shall be computed from the filing of the complaint. In
G.R. No. 113842, Lapuz seeks: (a) the setting aside of the decision of the
Court of Appeals insofar as it modifies the award of damages; b) actual and
compensatory damages in the sum equivalent to 5 years' loss of earnings
based on the petitioner's monthly salary of 1,600 Saudi rials at the current
conversion rate plus the cost of baggage and personal belongings worth
P2,000 and the service fee of P3,000 paid to the recruiting agency, all with
legal interest from the filing of the complaint until fully paid; c) moral damages
of not less than P1 million and exemplary damages of not less than
P500,000.00, both with interest at 6% per annum from the filing of the
complaint; and d) attorney's fees in the sum equivalent to 30% of the award of
damages.

It is evident that the issues raised in these petitions relate mainly to the
correctness of the factual findings of the Court of Appeals and the award of
damages. The Court has consistently affirmed that the findings of fact of the
Court of Appeals and the other lower courts are as a rule binding upon it,
subject to certain exceptions. As nothing in the record indicates any of such
exceptions, the factual conclusions of the appellate court must be affirmed.

The status of Lapuz as standby passenger was changed to that of a confirmed

passenger when his name was entered in the passenger manifest of KAL for
its Flight No. KE 903. His clearance through immigration and customs clearly
shows that he had indeed been confirmed as a passenger of KAL in that flight.
KAL thus committed a breach of the contract of carriage between them when it
failed to bring Lapuz to his destination.

This Court has held that a contract to transport passengers is different in kind
and degree from any other contractual relation. The business of the carrier is
mainly with the traveling public. It invites people to avail themselves of the
comforts and advantages it offers. The contract of air carriage generates a
relation attended with a public duty. Passengers have the right to be treated by
the carrier's employees with kindness, respect, courtesy and due
consideration. They are entitled to be protected against personal misconduct,
injurious language, indignities and abuses from such employees. So it is that
any discourteous conduct on the part of these employees toward a passenger
gives the latter an action for damages against the carrier.

The breach of contract was aggravated in this case when, instead of

courteously informing Lapuz of his being a "wait-listed" passenger, a KAL
officer rudely shouted "Down! Down!" while pointing at him, thus causing him
embarrassment and public humiliation.

KAL argues that "the evidence of confirmation of a chance passenger status is

not through the entry of the name of a chance passenger in the passenger
manifest nor the clearance from the Commission on Immigration and
Deportation, because they are merely means of facilitating the boarding of a
chance passenger in case his status is confirmed." We are not persuaded.

The evidence presented by Lapuz shows that he had indeed checked in at the
departure counter, passed through customs and immigration, boarded the
shuttle bus and proceeded to the ramp of KAL's aircraft. In fact, his baggage
had already been loaded in KAL' s aircraft, to be flown with him to Jeddah. The
contract of carriage between him and KAL had already been perfected when
he was summarily and insolently prevented from boarding the aircraft.

KAL's allegation that the respondent court abused its discretion in awarding
moral and exemplary damages is also not tenable.

The Court of Appeals granted moral and exemplary damages because:

The findings of the court a quo that the defendant-appellant has committed
breach of contract of carriage in bad faith and in wanton, disregard of plaintiffappellant's rights as passenger laid the basis and justification of an award for
moral damages.x x xIn the instant case, we find that defendant-appellant
Korean Air Lines acted in a wanton, fraudulent, reckless, oppressive or
malevolent manner when it "bumped off" plaintiff-appellant on November 8,
1980, and in addition treated him rudely and arrogantly as a "patay gutom na
contract worker fighting Korean Air Lines," which clearly shows malice and bad
faith, thus entitling plaintiff-appellant to moral damages.x x xConsidering that
the plaintiff-appellant's entitlement to moral damages has been fully
established by oral and documentary evidence, exemplary damages may be
awarded. In fact, exemplary damages may be awarded, even though not so
expressly pleaded in the complaint (Kapoe vs. Masa, 134 SCRA 231). By the
same token, to provide an example for the public good, an award of exemplary
damages is also proper (Armovit vs. Court of Appeals, supra).On the other
hand, Lapuz's claim that the award of P100,000.00 as moral and exemplary
damages is inadequate is not acceptable either. His prayer for moral damages
of not less than P1 million and exemplary damages of not less than
P500,000.00 is overblown.

The well-entrenched principle is that moral damages depend upon the

discretion of the court based on the circumstances of each case. This
discretion is limited by the principle that the "amount awarded should not be
palpably and scandalously excessive" as to indicate that it was the result of
prejudice or corruption on the part of the trial court. Damages are not intended
to enrich the complainant at the expense of the defendant. They are awarded
only to alleviate the moral suffering that the injured party had undergone by
reason of the defendant's culpable action. There is no hard-and-fast rule in the
determination of what would be a fair amount of moral damages since each
case must be governed by its own peculiar facts.

A review of the record of this case shows that the injury suffered by Lapuz is
not so serious or extensive as to warrant an award of P1.5 million. The
assessment of P100,000 as moral and exemplary damages in his favor is, in
our view, reasonable and realistic.

Lapuz likewise claims that the respondent court could not rule upon the
propriety of the award of actual damages because it had not been assigned as
an error by KAL. Not so. The rule is that only errors specifically assigned and
properly argued in the brief will be considered except errors affecting
jurisdiction over the subject matter and plain as well as clerical errors. But this
is not without qualification for, as the Court held in Vda. de Javellana vs. Court
of Appeals:

x x x [T]he Court is clothed with ample authority to review matters, even if they
are not assigned as errors in their appeal, if it finds that their consideration is
necessary in arriving at a just decision of the case.A similar pronouncement
was made in Baquiran vs. Court of Appeals in this wise:

Issues, though not specifically raised in the pleading in the appellate court,
may, in the interest of justice, be properly considered by said court in deciding
a case, if they are questions raised in the trial court and are matters of record
having some bearing on the issue submitted which the parties failed to raise or
the lower court ignored.The Court of Appeals was therefore justified in
decreasing the award of actual damages even if the issue was not assigned as
an error by KAL. Consideration of this question was necessary for the just and
complete resolution of the present case. Furthermore, there was enough
evidence to warrant the reduction of the original award, as the challenged
decision correctly observed:

A perusal of the plaintiff-appellant's contract of employment shows that the

effectivity of the contract is for only one year, renewable every year for five
years. Although plaintiff-appellant intends to renew his contract, such renewal
will still be subject to his foreign employer. Plaintiff-appellant had not yet
started working with his foreign employer, hence, there can be no basis as to
whether his contract will be renewed by his foreign employer or not. Thus, the
damages representing the loss of earnings of plaintiff-appellant in the renewal
of the contract of employment is at most speculative. Damages may not be
awarded on the basis of speculation or conjecture (Gachalian vs. Delim, 203
6

SCRA 126). Hence, defendant-appellant's liability is limited to the one year

contract only. Plaintiff-appellant is, therefore, entitled only to his lost earnings
for one year, i.e., P60,000.00, which is 1/5 of P300,000.00, the total amount of
actual damages, representing lost earnings for five years prayed for in the
Complaint.Plaintiff-appellant's contention that in computing his lost earnings,
the current rate of the Saudi Rial to the Philippine Peso at the time of payment
should be used, is untenable, considering that in his Complaint, plaintiffappellant has quantified in Philippine Peso his lost earnings for five years.We
disagree with the respondent court, however, on the date when the legal
interest should commence to run. The rule is that the legal interest of six
percent (6%) on the amounts adjudged in favor of Lapuz should resume from
the time of the rendition of the trial court's decision instead of November 28,
1980, the date of the filing of the complaint.

On this matter, the Court has held:

If suit were for payment of a definite sum of money, the contention might be
tenable. However, if it is for damages, unliquidated and not known until
definitely ascertained, assessed and determined by the courts after proof,
interest should be from the date of the decision.x x xThe obligation to pay
interest on a sum filed in a judgment exists from the date of the sentence,
when so declared; for until the net amount of the debtor's liability has been
determined, he cannot he considered delinquent in the fulfillment of his
obligation to pay the debt with interest thereon.Finally, we find that the
respondent court did not err in sustaining the trial court's dismissal of KAL's
counterclaim against Pan Pacific Overseas Recruiting Recruiting Services Inc.,
whose responsibility ended with the confirmation by KAL of Lapuz as its
passenger in its Flight No. 903.

This is still another case of the maltreatment of our overseas contract workers,
this time by the airline supposed to bring the passenger to his foreign
assignment. Our OCWs sacrifice much in seeking employment abroad, where
they are deprived of the company of their loved ones, the direct protection of
our laws, and the comfort of our own native culture and way of life. This Court
shall exert every effort to vindicate their rights when they are abused and shall
accord them the commensurate reparation of their injuries consistent with their
dignity and worth as members of the working class.

WHEREFORE, the appealed judgment is AFFIRMED, but with the modification

that the legal interest on the damages awarded to private respondent should
commence from the date of the decision of the trial court on November 14,
1990. The parties shall bear their own costs.

SO ORDERED.

SECOND DIVISION
[ G.R. No. 119756, March 18, 1999 ]

FORTUNE EXPRESS, INC., PETITIONER,

VS.
COURT OF APPEALS, PAULIE U. CAORONG, AND MINOR
CHILDREN YASSER KING CAORONG, ROSE HEINNI AND
PRINCE ALEXANDER, ALL SURNAMED CAORONG, AND
REPRESENTED BY THEIR MOTHER PAULIE U. CAORONG,
RESPONDENTS.

Petitioner is a bus company in northern Mindanao. Private respondent Paulie

Caorong is the widow of Atty. Caorong, while private respondents Yasser King,
Rose Heinni, and Prince Alexander are their minor children.

On November 18, 1989, a bus of petitioner figured in an accident with a

jeepney in Kauswagan, Lanao del Norte, resulting in the death of several
passengers of the jeepney, including two Maranaos. Crisanto Generalao, a
volunteer field agent of the Constabulary Regional Security Unit No. X,
conducted an investigation of the accident. He found that the owner of the
jeepney was a Maranao residing in Delabayan, Lanao del Norte and that
certain Maranaos were planning to take revenge on the petitioner by burning
some of its buses. Generalao rendered a report on his findings to Sgt.
Reynaldo Bastasa of the Philippine Constabulary Regional Hearquarters at
Cagayan de Oro. Upon the instruction of Sgt. Bastasa, he went to see
Diosdado Bravo, operations manager of petitioner, at its main office in
Cagayan de Oro City. Bravo assured him that the necessary precautions to
insure the safety of lives and property would be taken.

At about 6:45 P.M. on November 22, 1989, three armed Maranaos who
pretended to be passengers, seized a bus of petitioner at Linamon, Lanao del
Norte while on its way to Iligan City. Among the passengers of the bus was
Atty. Caorong. The leader of the Maranaos, identified as one Bashier
Mananggolo, ordered the driver, Godofredo Cabatuan, to stop the bus on the
side of the highway. Mananggolo then shot Cabatuan on the arm, which
caused him to slump on the steering wheel. Then one of the companions of
Mananggolo started pouring gasoline inside the bus, as the other held the
passengers at bay with a handgun. Mananggolo then ordered the passengers
to get off the bus. The passengers, including Atty. Caorong, stepped out of the
bus and went behind the bushes in a field some distance from the highway.

However, Atty. Caorong returned to the bus to retrieve something from the
overhead rack. At that time, one of the armed men was pouring gasoline on
the head of the driver. Cabatuan, who had meantime regained consciousness,
heard Atty. Caorong pleading with the armed men to spare the driver as he
was innocent of any wrong doing and was only trying to make a living. The
armed men were, however, adamant as they repeated their warning that they
were going to burn the bus along with its driver. During this exchange between
Atty. Caorong and the assailants, Cabatuan climbed out of the left window of
the bus and crawled to the canal on the opposite side of the highway. He
heard shots from inside the bus. Larry de la Cruz, one of the passengers, saw
that Atty. Caorong was hit. Then the bus was set on fire. Some of the
passengers were able to pull Atty. Caorong out of the burning bus and rush
him to the Mercy Community Hospital in Iligan City, but he died while
undergoing operation.

The private respondents brought this suit for breach of contract of carriage in
the Regional Trial Court, Branch VI, Iligan City. In his decision, dated
December 28, 1990, the trial court dismissed the complaint, holding as follows:
The fact that defendant, through Operations Manager Diosdado Bravo, was
informed of the "rumors" that the Moslems intended to take revenge by
burning five buses of defendant is established since the latter also utilized
Crisanto Generalaos as a witness. Yet despite this information, the plaintiffs
charge, defendant did not take proper precautions. . . . Consequently, plaintiffs
now fault the defendant for ignoring the report. Their position is that the
defendant should have provided its buses with security guards. Does the law
require common carriers to install security guards in its buses for the
protection and safety of its passengers? Is the failure to post guards an
omission of the duty to "exercise the diligence of a good father of the family"
which could have prevented the killing of Atty. Caorong? To our mind, the
diligence demanded by law does not include the posting of security guards in
buses. It is an obligation that properly belongs to the State. Besides, will the
presence of one or two security guards suffice to deter a determined assault of
the lawless and thus prevent the injury complained of? Maybe so, but again,
perhaps not. In other words, the presence of a security guard is not a
guarantee that the killing of Atty. Caorong would have been definitely avoided.

....

DECISIONMENDOZA, J.:

This is an appeal by petition for review on certiorari of the decision, dated July
29, 1994, of the Court of Appeals, which reversed the decision of the Regional
Trial Court, Branch VI, Iligan City. The aforesaid decision of the trial court
dismissed the complaint of private respondents against petitioner for damages
for breach of contract of carriage filed on the ground that petitioner had not
exercised the required degree of diligence in the operation of one of its buses.
Atty. Talib Caorong, whose heirs are private respondents herein, was a
passenger of the bus and was killed in the ambush involving said bus.

The facts of the instant case are as follows:

Accordingly, the failure of defendant to accord faith and credit to the report of
Mr. Generalao and the fact that it did not provide security to its buses cannot,
in the light of the circumstances, be characterized as negligence.

Finally, the evidence clearly shows that the assailants did not have the least
intention of harming any of the passengers. They ordered all the passengers
to alight and set fire on the bus only after all the passengers were out of
danger. The death of Atty. Caorong was an unexpected and unforseen
occurrence over which defendant had no control. Atty. Caorong performed an
act of charity and heroism in coming to the succor of the driver even in the
face of danger. He deserves the undying gratitude of the driver whose life he
saved. No one should blame him for an act of extraordinary charity and
altruism which cost his life. But neither should any blame be laid on the
doorstep of defendant. His death was solely due to the willful acts of the
lawless which defendant could neither prevent nor stop.
7

....

First. Petitioner's Breach of the Contract of Carriage

WHEREFORE, in view of the foregoing, the complaint is hereby dismissed.

For lack of merit, the counter-claim is likewise dismissed. No cost.On appeal,
however, the Court of Appeals reversed. It held:In the case at bench, how did
defendant-appellee react to the tip or information that certain Maranao
hotheads were planning to burn five of its buses out of revenge for the deaths
of two Maranaos in an earlier collision involving appellee's bus? Except for the
remarks of appellee's operations manager that "we will have our action . . . .
and I'll be the one to settle it personally," nothing concrete whatsoever was
taken by appellee or its employees to prevent the execution of the threat.
Defendant-appellee never adopted even a single safety measure for the
protection of its paying passengers. Were there available safeguards? Of
course, there were: one was frisking passengers particularly those en route to
the area where the threats were likely to be carried out such as where the
earlier accident occurred or the place of influence of the victims or their
locality. If frisking was resorted to, even temporarily, . . . . appellee might be
legally excused from liability. Frisking of passengers picked up along the route
could have been implemented by the bus conductor; for those boarding at the
bus terminal, frisking could have been conducted by him and perhaps by
additional personnel of defendant-appellee. On hindsight, the handguns and
especially the gallon of gasoline used by the felons all of which were brought
inside the bus would have been discovered, thus preventing the burning of the
bus and the fatal shooting of the victim.

Art. 1763 of the Civil Code provides that a common carrier is responsible for
injuries suffered by a passenger on account of the wilful acts of other
passengers, if the employees of the common carrier could have prevented the
act the exercise of the diligence of a good father of a family. In the present
case, it is clear that because of the negligence of petitioner's employees, the
seizure of the bus by Mananggolo and his men was made possible.

Appellee's argument that there is no law requiring it to provide guards on its

buses and that the safety of citizens is the duty of the government, is not well
taken. To be sure, appellee is not expected to assign security guards on all of
its buses; if at all, it has the duty to post guards only on its buses plying
predominantly Maranao areas. As discussed in the next preceding paragraph,
the least appellee could have done in response to the report was to adopt a
system of verification such as frisking of passengers boarding its buses.
Nothing, and to repeat, nothing at all, was done by defendant-appellee to
protect its innocent passengers from the danger arising from the "Maranao
threats." It must be observed that frisking is not a novelty as a safety measure
in our society. Sensitive places - in fact, nearly all important places - have
applied this method of security enhancement. Gadgets and devices are
available in the market for this purpose. It would not have weighed much
against the budget of the bus company if such items were made available to
its personnel to cope up with situations such as the "Maranao threats."

In view of the constitutional right to personal privacy, our pronouncement in

this decision should not be construed as an advocacy of mandatory frisking in
all public conveyances. What we are saying is that given the circumstances
obtaining in the case at bench that: (a) two Maranaos died because of a
vehicular collision involving one of appellee's vehicles; (b) appellee received a
written report from a member of the Regional Security Unit, Constabulary
Security Group, that the tribal/ethnic group of the two deceased were planning
to burn five buses of appellee out of revenge; and (c) appellee did nothing absolutely nothing - for the safety of its passengers travelling in the area of
influence of the victims, appellee has failed to exercise the degree of diligence
required of common carriers. Hence, appellee must be adjudged liable.

....

WHEREFORE, the decision appealed from is hereby REVERSED and another

rendered ordering defendant-appellee to pay plaintiffs-appellants the following:

1) P3,399,649.20 as death indemnity;

2) P50,000.00 and P500.00 per appearance as attorney's fees; and

Costs against defendant-appellee.Hence, this appeal. Petitioner contends:(A)

THAT PUBLIC RESPONDENT ERRED IN REVERSING THE DECISION OF
THE REGIONAL TRIAL COURT DATED DECEMBER 28, 1990 DISMISSING
THE COMPLAINT AS WELL AS THE COUNTERCLAIM, AND FINDING FOR
PRIVATE RESPONDENTS BY ORDERING PETITIONER TO PAY THE
GARGANTUAN SUM OF P3,449,649.20 PLUS P500.00 PER APPEARANCE
AS ATTORNEY'S FEES, AS WELL AS DENYING PETITIONER'S MOTION
FOR RECONSIDERATION AND THE SUPPLEMENT TO SAID MOTION,
WHILE HOLDING, AMONG OTHERS, THAT PETITIONER BREACHED THE
CONTRACT OF CARIAGE BY ITS FAILURE TO EXERCISE THE REQUIRED
DEGREE OF DILIGENCE;(B) THAT THE ACTS OF THE MARANAO
OUTLAWS WERE SO GRAVE, IRRESISTIBLE, VIOLENT, AND FORCEFUL,
AS TO BE REGARDED AS CASO FORTUITO; AND(C) THAT PUBLIC
RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN HOLDING
THAT PETITIONER COULD HAVE PROVIDED ADEQUATE SECURITY IN
PREDOMINANTLY MUSLIM AREAS AS PART OF ITS DUTY TO OBSERVE
EXTRA-ORDINARY DILIGENCE AS A COMMON CARRIER.The instant
petition has no merit.

Despite warning by the Philippine Constabulary at Cagayan de Oro that the

Maranaos were planning to take revenge on the petitioner by burning some of
its buses and the assurance of petitioner's operation manager, Diosdado
Bravo, that the necessary precautions would be taken, petitioner did nothing to
protect the safety of its passengers.

Had petitioner and its employees been vigilant they would not have failed to
see that the malefactors had a large quantity of gasoline with them. Under the
circumstances, simple precautionary measures to protect the safety of
passengers, such as frisking passengers and inspecting their baggages,
preferably with non-intrusive gadgets such as metal detectors, before allowing
them on board could have been employed without violating the passenger's
constitutional rights. As this Court intimated in Gacal v. Philippine Air Lines,
Inc., a common carrier can be held liable for failing to prevent a hijacking by
frisking passengers and inspecting their baggages.

From the foregoing, it is evident that petitioner's employees failed to prevent

the attack on one of petitioner's buses because they did not exercise the
diligence of a good father of a family. Hence, petitioner should be held liable
for the death of Atty. Caorong.

Second. Seizure of Petitioner's Bus not a Case of Force Majeure

The petitioner contends that the seizure of its bus by the armed assailants was
a fortuitous event for which it could not be held liable.

Art. 1174 of the Civil Code defines a fortuitous even as an occurrence which
could not be foreseen or which though foreseen, is inevitable. In Yobido v.
Court of Appeals, we held that to be considered as force majeure, it is
necessary that: (1) the cause of the breach of the obligation must be
independent of the human will; (2) the event must be either unforeseeable or
unavoidable; (3) the occurrence must be such as to render it impossible for the
debtor to fulfill the obligation in a normal manner; and (4) the obligor must be
free of participation in, or aggravation of, the injury to the creditor. The
absence of any of the requisites mentioned above would prevent the obligor
from being excused from liability.

Thus, in Vasquez v. Court of Appeals, it was held that the common carrier was
liable for its failure to take the necessary precautions against an approaching
typhoon, of which it was warned, resulting in the loss of the lives of several
passengers. The event was foreseeable, and, thus, the second requisite
mentioned above was not fulfilled. This ruling applies by analogy to the
present case. Despite the report of PC agent Generalao that the Maranaos
were going to attack its buses, petitioner took no steps to safeguard the lives
and properties of its passengers. The seizure of the bus of the petitioner was
foreseeable and, therefore, was not a fortuitous event which would exempt
petitioner from liability.

Petitioner invokes the ruling in Pilapil v. Court of Appeals and De Guzman v.

Court of Appeals in support of its contention that the seizure of its bus by the
assailants constitutes force majeure. In Pilapil v. Court of Appeals, it was held
that a common carrier is not liable for failing to install window grills on its buses
to protect passengers from injuries caused by rocks hurled at the bus by
lawless elements. On the other hand, in De Guzman v. Court of Appeals, it
was ruled that a common carrier is not responsible for goods lost as a result of
a robbery which is attended by grave or irresistible threat, violence, or force.

It is clear that the cases of Pilapil and De Guzman do not apply to the present
case. Art. 1755 of the Civil Code provides that "a common carrier is bound to
carry the passengers as far as human care and foresight can provide, using
the utmost diligence of very cautious person, with due regard for all the
circumstances." Thus, we held in Pilapil and De Guzman that the respondents
therein were not negligent in failing to take special precautions against threats
to the safety of passengers which could not be foreseen, such as tortious or
criminal acts of third persons. In the present case, this factor of
unforeseeablility (the second requisite for an event to be considered force
majeure) is lacking. As already stated, despite the report of PC agent
Generalao that the Maranaos were planning to burn some of petitioner's buses
and the assurance of petitioner's operations manager (Diosdado Bravo) that
the necessary precautions would be taken, nothing was really done by
petitioner to protect the safety of passengers.
8

Third. Deceased not Guilty of Contributory Negligence

The petitioner contends that Atty. Caorong was guilty of contributory

negligence in returning to the bus to retrieve something. But Atty. Caorong did
not act recklessly. It should be pointed out that the intended targets of the
violence were petitioner and its employees, not its passengers. The assailant's
motive was to retaliate for the loss of life of two Maranaos as a result of the
collision between petitioner's bus and the jeepney in which the two Maranaos
were riding. Mananggolo, the leader of the group which had hijacked the bus,
ordered the passengers to get off the bus as they intended to burn it and its
driver. The armed men actually allowed Atty. Caorong to retrieve something
from the bus. What apparently angered them was his attempt to help the driver
of the bus by pleading for his life. He was playing the role of the good
Samaritan. Certainly, this act cannot be considered an act of negligence, let
alone recklessness.

Fourth. Petitioner Liable to Private Respondents for Damages

We now consider the question of damages that the heirs of Atty. Caorong,
private respondents herein, are entitled to recover from the petitioner.

Indemnity for Death. Art. 1764 of the Civil Code, in relation to Art. 2206 thereof,
provides for the payment of indemnity for the death of passengers caused by
the breached of contract of carriage by a common carrier. Initially fixed in Art.
2206 at P3,000.00, the amount of the said indemnity for death has through the
years been gradually increased in view of the declining value of the peso. It is
presently fixed at P50,000.00. Private respondents are entitled to this amount.

WHEREFORE, the decision, dated July 29, 1994, of the Court of Appeals is
hereby AFFIRMED with the MODIFICATION that petitioner Fortune Express,
Inc. is ordered to pay the following amounts to private respondents Paulie,
Yasser King, Rose Heinni, and Prince Alexander Caorong:death indemnity in
the amount of fifty thousand pesos (P50,000.00);

actual damages in the amount of thirty thousand pesos (P30,000.00);

moral damages in the amount of one hundred thousand pesos(P100,000.00);

exemplary damages in the amount of one hundred thousand pesos

(P100,000.00);

attorney's fees in the amount of fifty thousand pesos (P50,000.00);

compensation for loss of earning capacity in the amount of two million one
hundred twenty-one thousand four hundred four pesos and ninety centavos
(P2,121,404.90); and

costs of suits.SO ORDERED.

Bellosillo, (Chairman), Puno, and Buena, JJ., concur.Quisumbing, J., on official

business abroad.

Actual damages. Art. 2199 provides that "Except as provided by law or by

stipulation, one is entitled to an adequate compensation only for such
pecuniary loss suffered by him as he has duly proved." The trial court found
that the private respondents spent P30,000.00 for the wake and burial of Atty.
Caorong. Since petitioner does not question this finding of the trial court, it is
liable to private respondents in the said amount as actual damages.
FIRST DIVISION
[ G.R. Nos. 66102-04, August 30, 1990 ]
Moral Damages. Under Art. 2206, the "spouse, legitimate and illegitimate
descendants and ascendants of the deceased may demand moral damages
for mental anguish by reason of the death of the deceased." The trial court
found that private respondent Paulie Caorong suffered pain from the death of
her husband and worry on how to provide support for their minor children,
private respondents Yasser King, Rose Heinni, and Prince Alexander. The
petitioner likewise does not question this finding of the trial court. Thus, in
accordance with recent decisions of this Court, we hold that the petitioner is
liable to the private respondents in the amount of P100,000.00 as moral
damages for the death of Atty. Caorong.

Exemplary Damages. Art. 2232 provides that "in contracts and quasicontracts, the court may award exemplary damages if the defendant acted in a
wanton, fraudulent, reckless, oppressive, or malevolent manner." In the
present case, the petitioner acted in a wanton and reckless manner. Despite
warning that the Maranaos were planning to take revenge against the
petitioner by burning some of its buses, and contrary to the assurance made
by its operations manager that the necessary precautions would be taken, the
petitioner and its employees did nothing to protect the safety of passengers.
Under the circumstances, we deem it reasonable to award private respondents
exemplary damages in the amount of P100,000.00.

Attorney's Fees. Pursuant to Art. 2208, attorney's fees may be recovered

when, as in the instant case, exemplary damages are awarded. In the recent
case of Sulpicio Lines, Inc. v. Court of Appeals, we held an award of
P50,000.00 as attorney's fees to be reasonable. Hence, the private
respondents are entitled to attorney's fees in that amount.

Compensation for Loss of Earning Capacity. Art. 1764 of the Civil Code, in
relation to Art. 2206 thereof, provides that in addition to the indemnity for death
arising from the breach of contract of carriage by a common carrier, the
"defendant shall be liable for the loss of the earning capacity of the deceased,
and the indemnity shall be paid to the heirs of the latter." The formula
established in decided cases for computing net earning capacity is as follows:
Gross NecessaryNet earning =Life x Annual -LivingCapacity Expectancy
Income ExpensesLife expectancy is equivalent to two thirds (2/3) multiplied by
the difference of eighty (80) and the age of the deceased. Since Atty. Caorong
was 37 years old at the time of his death, he had a life expectancy of 28 2/3
more years. His projected gross annual income, computed based on his
monthly salary of P11,385.00 as a lawyer in the Department of Agrarian
Reform at the time of his death, was P148,005.00. allowing for necessary
living expenses of fifty percent (50%)of his projected gross annual income, his
total earning capacity amounts to P2,121,404.90. Hence, the petitioner is liable
to the private respondents in the said amount as compensation for loss of
earning capacity.

PHILIPPINE RABBIT BUS LINES, INC., PETITIONER,

VS.
THE HONORABLE INTERMEDIATE APPELLATE COURT AND
CASIANO PASCUA, ET AL.,* RESPONDENTS.

DECISIONMEDIALDEA, J.:

This is a petition for review on certiorari of the decision of the Intermediate

Appellate Court (now Court of Appeals) dated July 29, 1983 in AC-G.R. Nos.
CV-65885, CV-65886 and CV-65887 which reversed the decision of the Court
of First Instance (now Regional Trial Court) of Pangasinan dated December
27, 1978; and its resolution dated November 28, 1983 denying the motion for
reconsideration.

It is an established principle that the factual findings of the Court of Appeals

are final and may not be reviewed by this Court on appeal. However, this
principle is subject to certain exceptions. One of these is when the findings of
the appellate court are contrary to those of the trial court (see Sabinosa v. The
Honorable Court of Appeals, et al., G.R. No. L-47981, July 24, 1989) in which
case, a re?examination of the facts and evidence may be undertaken. This is
Our task now.

The antecedent facts are as follows:

About 11:00 o'clock in the morning on December 24, 1966, Catalina Pascua,
Caridad Pascua, Adelaida Estomo, Erlinda Meriales, Mercedes Lorenzo,
Alejandro Morales and Zenaida Parejas boarded the jeepney owned by
spouses Isidro Mangune and Guillerma Carreon and driven by Tranquilino
Manalo at Dau, Mabalacat, Pampanga bound for Carmen, Rosales,
Pangasinan to spend Christmas at their respective homes. Although they
usually ride in buses, they had to ride in a jeepney that day because the buses
were full. Their contract with Manalo was for them to pay P24.00 for the trip.
The private respondents' testimonial evidence on this contractual relationship
was not controverted by Mangune, Carreon and Manalo, nor by Filriters
Guaranty Assurance Corporation, Inc., the insurer of the jeepney, with contrary
evidence. Purportedly riding on the front seat with Manalo was Mercedes
9

Lorenzo. On the left rear passenger seat were Caridad Pascua, Alejandro
Morales and Zenaida Parejas. On the right rear passenger seat were Catalina
Pascua, Adelaida Estomo, and Erlinda Meriales. After a brief stopover at
Moncada, Tarlac for refreshment, the jeepney proceeded towards Carmen,
Rosales, Pangasinan.

Upon reaching barrio Sinayoan, San Manuel, Tarlac, the right rear wheel of the
jeepney was detached, so it was running in an unbalanced position. Manalo
stepped on the brake, as a result of which, the jeepney which was then
running on the eastern lane (its right of way) made a U-turn, invading and
eventually stopping on the western lane of the road in such a manner that the
jeepney's front faced the south (from where it came) and its rear faced the
north (towards where it was going). The jeepney practically occupied and
blocked the greater portion of the western lane, which is the right of way of
vehicles coming from the north, among which was Bus No. 753 of petitioner
Philippine Rabbit Bus Lines, Inc. (Rabbit) driven by Tomas delos Reyes.
Almost at the time when the jeepney made a sudden U-turn and encroached
on the western lane of the highway as claimed by Rabbit and delos Reyes, or
after stopping for a couple of minutes as claimed by Mangune, Carreon and
Manalo, the bus bumped from behind the right rear portion of the jeepney. As a
result of the collision, three passengers of the jeepney (Catalina Pascua,
Erlinda Meriales and Adelaida Estomo) died while the other jeepney
passengers sustained physical injuries. What could have been a festive
Christmas turned out to be tragic.

The causes of the death of the three jeepney passengers were as follows (p.
101, Record on Appeal):

"The deceased Catalina Pascua suffered the following injuries, to wit: fracture
of the left parietal and temporal regions of the skull; fracture of the left
mandible; fracture of the right humenous; compound fracture of the left radious
and ullma, middle third and lower third; fracture of the upper third of the right
tibia and fillnea; avulsion of the head, left internal; and multiple abrasions. The
cause of her death was shock, secondary to fracture and multiple hemorrhage.
The fractures were produced as a result of the hitting of the victim by a strong
force. The abrasions could be produced when a person falls from a moving
vehicles (sic) and rubs parts of her body against a cement road pavement. x x
x."Erlinda Mariles (sic) sustained external lesions such as contusion on the left
parietal region of the skull; hematoma on the right upper lid; and barasions
(sic) on the left knee. Her internal lesions were: hematoma on the left thorax;
multiple lacerations of the left lower lobe of the lungs; contusions on the left
lower lobe of the lungs; and simple fractures of the 2nd, 3rd, 4th, 5th, 6th, 7th,
and 8th ribs, left. The forcible impact of the jeep caused the above injuries
which resulted in her death. x x x."The cause of death of Erlinda or Florida
Estomo (also called Adelaida) as per autopsy of Dr. Panlasiqui was due to
shock due to internal hemorrhage, ruptured spleen and trauma. x x x."Caridad
Pascua suffered physical injuries as follows (p. 101, Record on Appeal):

"x x x lacerated wound on the forehead and occipital region, hematoma on the
forehead, multiple abrasions on the forearm, right upper arm, back and right
leg. x x x."The police investigators of Tacpal and policemen of San Manuel,
Tarlac, Tarlac, upon arrival at the scene of the mishap, prepared a sketch
(common exhibit "K" for private respondents and "19 for Rabbit) showing the
relative positions of the two vehicles as well as the alleged point of impact (p.
100, Record on Appeal):

"x x x. The point of collision was a cement pave-portion of the Highway, about
six (6) meters wide, with narrow shoulders with grasses beyond which are
canals on both sides. The road was straight and points 200 meters north and
south of the point of collision are visible and unobstructed. Purportedly, the
point of impact or collision (Exh. 'K-4'-Pascua, on the sketch Exh. 'K'-Pascua)
was on the western lane of the highway about 3 feet (or one yard) from the
center line as shown by the bedris (sic), dirt and soil (obviously from the
undercarriage of both vehicles) as well as paint, marron (sic) from the Rabbit
bus and greenish from the jeepney. The point of impact encircled and marked
with the letter 'X' in Exh. 'K'-4, Pascua, had a diameter of two meters, the
center of which was about two meters from the western edge of cement
pavement of the roadway. Pictures taken by witness Bisquera in the course of
the investigation showed the relative positions of the point of impact and
center line (Exh. 'P'-Pascua) the back of the Rabbit bus (Exh. 'P-1-Pascua),
the lifeless body of Catalina Pascua (Exh 'P-2-Pascua'), and the damaged
front part of the Rabbit bus (Exh. 'P-3-Pascua'). No skid marks of the Rabbit
bus was found in the vicinity of the collision, before or after the point of impact.
On the other hand, there was a skid mark about 45 meters long purportedly of
the jeepney from the eastern shoulder of the road south of, and extending up
to the point of impact."At the time and in the vicinity of the accident, there were
no vehicles following the jeepney, neither were there oncoming vehicles
except the bus. The weather condition of that day was fair.

After conducting the investigation, the police filed with the Municipal Court of
San Manuel, Tarlac, a criminal complaint against the two drivers for Multiple
Homicide. At the preliminary investigation, a probable cause was found with
respect to the case of Manalo, thus, his case was elevated to the Court of First
Instance. However, finding no sufficiency of evidence as regards the case of
delos Reyes, the Court dismissed it. Manalo was convicted and sentenced to

suffer imprisonment. Not having appealed, he served his sentence.

Complaints for recovery of damages were then filed before the Court of First
Instance of Pangasinan. In Civil Case No. 1136, spouses Casiano Pascua and
Juana Valdez sued as heirs of Catalina Pascua while Caridad Pascua sued in
her behalf. In Civil Case No. 1139, spouses Manuel Millares and Fidencia
Arcica sued as heirs of Erlinda Meriales. In Civil Case No. 1140, spouses
Mariano Estomo and Dionisia Sarmiento also sued as heirs of Adelaida
Estomo.

In all three cases, spouses Mangune and Carreon, Manalo, Rabbit and delos
Reyes were all impleaded as defendants. Plaintiffs anchored their suits against
spouses Mangune and Carreon and Manalo on their contractual liability. As
against Rabbit and delos Reyes, plaintiffs based their suits on their culpability
for a quasi-delict. Filriters Guaranty Assurance Corporation, Inc. was also
impleaded as additional defendant in Civil Case No. 1136 only.

For the death of Catalina Pascua, plaintiffs in Civil Case No. 1136 sought to
collect the aggregate amount of P70,060.00 in damages, itemized as follows:
P500.00 for burial expenses; P12,000.00 for loss of wages for 24 years;
P10,000.00 for exemplary damages; P10,000.00 for moral damages; and
P3,000.00 for attorney's fees. In the same case, plaintiff Caridad Pascua
claimed P550.00 for medical expenses; P240.00 for loss of wages for two
months; P2,000.00 for disfigurement of her face; P3,000.00 for physical pain
and suffering; P2,500.00 as exemplary damages and P2,000.00 for attorney's
fees and expenses of litigation.

In Civil Case No. 1139, plaintiffs demanded P500.00 for burial expenses;
P6,000.00 for the death of Erlinda, P63,000.00 for loss of income P10,000.00
for moral damages and P3,000.00 for attorney's fees or total of P80,000.00.

In Civil Case No. 1140, plaintiffs claimed P500.00 for burial expenses;
P6,000.00 for the death of Adelaida, P56,160.00 for loss of her income or
earning capacity; P10,000.00 for moral damages; and P3,000.00 for attorney's
fees.

Rabbit filed a cross-claim in the amount of P15,000.00 for attorney's fees and
expenses of litigation. On the other hand, spouses Mangune and Carreon filed
a cross-claim in the amount of P6,168.00 for the repair of the jeepney and
P3,000.00 for its non-use during the period of repairs.

On December 27, 1978, the trial court rendered its decision finding Manalo
negligent, the dispositive portion of which reads (pp. 113-114, Record on
Appeal):

"PREMISES CONSIDERED, this Court is of the opinion and so holds: "1) That
defendants Isidro Mangune, Guillerma Carreon and Tranquilino Manalo thru
their negligence, breached contract of carriage with their passengers the
plaintiffs' and/or their heirs, and this Court renders judgment ordering said
defendants, jointly and severally, to pay the plaintiffs -'a) In Civil Case No.
1136, for the death of Catalina Pascua, to pay her heirs the amounts of
P12,000.00 for indemnity for loss of her life; P41,760.00 for loss of earnings;
P324.40 for actual expenses and P2,000.00 for moral damages;

'b) In the same Civil Case No. 1136 for the injuries of Caridad Pascua, to pay
her the amounts of P240.00 for loss of wages, P328.20 for actual expenses
and P500.00 for moral damages;

'c) In Civil Case No. 1139 for the death of Erlinda Meriales, to pay her heirs
(the plaintiffs) the amount of P12,000.00 - for indemnity for loss of her life;
P622.00 for actual expenses, P60,480.00 for loss of wages or income and
P2,000.00 for moral damages;

'd) In Civil Case No. 1140, for the death of Erlinda (also called Florida or
Adelaida Estomo), to pay her heirs (the plaintiffs) the amount of P12,000.00 for
indemnity for the loss of her life; P580.00 for actual expenses; P53,160.00 for
loss of wages or income and P2,000.00 for moral damages.'

"2) The defendant Filriters Guaranty Insurance Co., having contracted to

ensure and answer for the obligations of defendants Mangune and Carreon for
damages due their passengers, this Court renders judgment against the said
defendants Filriters Guaranty Insurance Co., jointly and severally with said
defendants (Mangune and Carreon) to pay the plaintiffs the amount herein
above adjudicated in their favor in Civil Case No. 1136 only. All the amounts
awarded said plaintiffs as set forth in paragraph one (1) hereinabove;"3) On
the cross claim of Phil. Rabbit Bus Lines, Inc. ordering the defendants Isidro
Mangune, Guillerma Carreon and Tranquilino Manalo, to pay jointly and
severally, cross-claimant Phil. Rabbit Bus Lines, Inc., the amounts of P216.27
10

as actual damages to its Bus No. 753 and P2,173.60 for loss of its earning. "All
of the above amounts shall bear legal interest from the filing of the complaints.
"Costs are adjudged against defendants Mangune, Carreon and Manalo and
Filriters Guaranty."SO ORDERED."On appeal, the Intermediate Appellate
Court reversed the above-quoted decision by finding delos Reyes negligent,
the dispositive portion of which reads (pp. 55-57, Rollo):

"WHEREFORE, PREMISES CONSIDERED, the lower court's decision is

hereby REVERSED as to item No. 3 of the decision which reads:'(3) On the
cross claim of Philippine Rabbit Bus Lines, Inc. ordering the defendants Isidro
Mangune, Guillerma Carreon and Tranquilino Manalo, to pay jointly and
severally, the amounts of P216.27 as actual damages to its Bus No. 753 and
P2,173.60 for loss of its earnings.'
and another judgment is hereby rendered in favor of plaintiffs-appellants
Casiana Pascua, Juan Valdez and Caridad Pascua, ordering the Philippine
Rabit Bus Lines, Inc. and its driver Tomas delos Reyes to pay the former jointly
and severally damages in amounts awarded as follows:"For the death of
Catalina Pascua, the parents and/or heirs are awarded:"Civil Case No. 1136 a) Indemnity for the loss of life
- P12,000.00
b) Loss of Salaries or earning capacity
- 14,000.00
c) Actual damages (burial expenses)
- 800.00
d) For moral damages
- 10,000.00
e) Exemplary damages
- 3,000.00
f) For attorney's fees
- 3,000.00
Total
P38,200.00 (sic)
"For the physical injuries suffered by Caridad Pascua:"Civil Case No. 1136a)
Actual damages (hospitalization expenses)
- P 550.00
b) Moral damages (disfigurement of the face and physical suffering
- 8,000.00
c) Exemplary damages
- 2,000.00
Total
- P10,550.00
"For the death of Erlinda Arcega Meriales, the parents and/or heirs: "Civil Case
No. 1139a) Indemnity for loss of life
- P12,000.00
b) Loss of Salary or Earning Capacity
- 20,000.00
c) Actual damages (burial expenses)
- 500.00
d) Moral damages
- 15 000.00
e) Exemplary damages
- 15,000.00
f) Attorney's fees
- 3,000.00
Total
- P45,500 00
"For the death of Florida Sarmiento Estomo:"Civil Case No. 1140.a) Indemnity
for loss of life
- P12,000.00
b) Loss of Salary or Earning capacity
- 20,000.00
c) Actual damages (burial expenses)
- 500.00
d) Moral damages
- 3,000.00
e) Exemplary damages
- 3,000.00
f) Attorney's fees
- 3,000.00
Total
- P41,500.00
"With costs against the Philippine Rabbit Bus Lines, Inc."SO ORDERED."The
motion for reconsideration was denied. Hence, the present petition.

The issue is who is liable for the death and physical injuries suffered by the
passengers of the jeepney?

The trial court, in declaring that Manalo was negligent, considered the
following (p. 106, Record on Appeal):

"(1) That the unrebutted testimony of his passenger plaintiff Caridad Pascua
that a long ways (sic) before reaching the point of collision, the Mangune
jeepney was 'running fast' that his passengers cautioned driver Manalo to slow
down but did not heed the warning: that the right rear wheel was detached
causing the jeepney to run to the eastern shoulder of the road then back to the
concrete pavement; that driver Manalo applied the brakes after which the

jeepney made a U-turn (half-turn) in such a manner that it inverted its direction
making it face South instead of north; that the jeepney stopped on the western
lane of the road on the right of way of the oncoming Phil. Rabbit Bus where it
was bumped by the latter;"(2) The likewise unrebutted testimony of Police
Investigator Tacpal of the San Manuel (Tarlac) Police who, upon responding to
the reported collision, found the real evidence thereat indicating in his sketch
(Exh. K, Pascua), the tracks of the jeepney of defendant Mangune and
Carreon running on the Eastern shoulder (outside the concrete paved road)
until it returned to the concrete road at a sharp angle, crossing the Eastern
lane and the (imaginary) center line and encroaching fully into the western
lane where the collision took place as evidenced by the point of impact;"(3)
The observation of witness Police Corporal Cacalda also of the San Manuel
Police that the path of the jeepney they found on the road (and indicated in the
sketch (Exh. K-Pascua) was shown by skid marks which he described as
'scratches on the road caused by the iron of the jeep, after its wheel was
removed;'"(4) His conviction for the crime of Multiple Homicide and Multiple
Serious Physical Injuries with Damage to Property thru Reckless Imprudence
by the Court of First Instance of Tarlac (Exh. 24-Rabbit) upon the criminal
Information by the Provincial Fiscal of Tarlac (Exh. 23-Rabbit), as a result of
the collision, and his commitment to prison and service of his sentence (Exh.
25-Rabbit) upon the finality of the decision and his failure to appeal therefrom;
and"(5) The application of the doctrine of res-ipsa loquitar (sic) attesting to the
circumstance that the collision occurred (sic) on the right of way of the Phil.
Rabbit Bus."The respondent court had a contrary opinion. Applying primarily
(1) the doctrine of last clear chance, (2) the presumption that drivers who
bump the rear of another vehicle guilty and the cause of the accident unless
contradicted by other evidence, and (3) the substantial factor test, concluded
that delos Reyes was negligent.

The misappreciation of the facts and evidence and the misapplication of the
laws by the respondent court warrant a reversal of its questioned decision and
resolution.

We reiterate that "[t]he principle about the 'last clear chance' would call for
application in a suit between the owners and drivers of the two colliding
vehicles. It does not arise where a passenger demands responsibility from the
carrier to enforce its contractual obligations. For it would be inequitable to
exempt the negligent driver of the jeepney and its owners on the ground that
the other driver was likewise guilty of negligence." This was Our ruling in
Anuran, et al. v. Buo, et al., G.R. Nos. L-21353 and L-21354, May 20, 1966,
17 SCRA 224. Thus, the respondent court erred in applying said doctrine.

On the presumption that drivers who bump the rear of another vehicle guilty
and the cause of the accident, unless contradicted by other evidence, the
respondent court said (p. 49, Rollo):

"x x x, the jeepney had already executed a complete turnabout and at the time
of impact was already facing the western side of the road. Thus the jeepney
assumed a new frontal position vis a vis, the bus, and the bus assumed a new
role of defensive driving. The spirit behind the presumption of guilt on one who
bumps the rear end of another vehicle is for the driver following a vehicle to be
at all times prepared of a pending accident should the driver in front suddenly
come to a full stop, or change its course either through change of mind of the
front driver, mechanical trouble, or to avoid an accident. The rear vehicle is
given the responsibility of avoiding a collision with the front vehicle for it is the
rear vehicle who has full control of the situation as it is in a position to observe
the vehicle in front of it."The above discussion would have been correct were it
not for the undisputed fact that the U-turn made by the jeepney was abrupt
(Exhibit "K," Pascua). The jeepney, which was then traveling on the eastern
shoulder, making a straight skid mark of approximately 35 meters, crossed the
eastern lane at a sharp angle, making a skid mark of approximately 15 meters
from the eastern shoulder to the point of impact (Exhibit "K," Pascua). Hence,
delos Reyes could not have anticipated the sudden U-turn executed by
Manalo. The respondent court did not realize that the presumption was
rebutted by this piece of evidence.

With regard to the substantial factor test, it was the opinion of the respondent
court that (p. 52, Rollo):

"x x x. It is the rule under the substantial factor test that if the actor's conduct is
a substantial factor it bringing about harm to another, the fact that the actor
neither foresaw nor should have foreseen the extent of the harm or the
manner in which it occurred does not prevent him from being liable
(Restatement, Torts, 2d). Here, We find defendant bus running at a fast speed
when the accident occurred and did not even make the slightest effort to avoid
the accident, x x x. The bus driver's conduct is thus a substantial factor in
bringing about harm to the passengers of the jeepney, not only because he
was driving fast and did not even attempt to avoid the mishap, but also
because it was the bus which was the physical force which brought about the
injury and death to the passengers of the jeepney."The speed of the bus was
calculated by respondent court as follows (pp. 54-55, Rollo):

"According to the record of the case, the bus departed from Laoag, Ilocos
Norte, at 4:00 o'clock A.M. and the accident took place at approximately
11

around 12:30 P.M., after travelling roughly for 8 hours and 30 minutes. Deduct
from this the actual stopover time of two Hours (computed from the testimony
of the driver that he made three 40-minute stopovers), We will have an actual
travelling time of 6 hours and 30 minutes."Under the circumstances, We
calculate that the Laoag-Tarlac route (365 kms.) driving at an average of 56
km. per hour would take 6 hours and 30 minutes. Therefore, the average
speed of the bus, give and take 10 minutes, from the point of impact on the
highway with excellent visibility factor would be 80 to 90 kms. per hour, as this
is the place where buses would make up for lost time in traversing busy city
streets."Still, We are not convinced. It cannot be said that the bus was
travelling at a fast speed when the accident occurred because the speed of 80
to 90 kilometers per hour, assuming such calculation to be correct, is yet within
the speed limit allowed in highways. We cannot even fault delos Reyes for not
having avoided the collision. As aforestated, the jeepney left a skid mark of
about 45 meters, measured from the time its right rear wheel was detached up
to the point of collision. Delos Reyes must have noticed the perilous condition
of the jeepney from the time its right rear wheel was detached or some 90
meters away, considering that the road was straight and points 200 meters
north and south of the point of collision, visible and unobstructed. Delos Reyes
admitted that he was running more or less 50 kilometers per hour at the time
of the accident. Using this speed, delos Reyes covered the distance of 45
meters in 3.24 seconds. If We adopt the speed of 80 kilometers per hour,
delos Reyes would have covered that distance in only 2.025 seconds. Verily,
he had little time to react to the situation. To require delos Reyes to avoid the
collision is to ask too much from him. Aside from the time element involved,
there were no options available to him. As the trial court remarked (pp. 107108, Record on Appeal):

"x x x. They (plaintiffs) tried to impress this Court that defendant de los Reyes,
could have taken either of two options: (1) to swerve to its right (western
shoulder) or (2) to swerve to its left (eastern lane), and thus steer clear of the
Mangune jeepney. This Court does not so believe, considering the existing
exigencies of space and time."As to the first option, Phil. Rabbit's evidence is
convincing and unrebutted that the Western shoulder of the road was narrow
and had tall grasses which would indicate that it was not passable. Even
plaintiff's own evidence, the pictures (Exhs. P and P-2, Pascua) are mute
confirmation of such fact. Indeed, it can be noticed in the picture (Exh. P-2,
Pascua) after the Rabbit bus came to a full stop, it was tilted to right front side,
its front wheels resting most probably on a canal on a much lower elevation
that of the shoulder or paved road. It too shows that all of the wheels of the
Rabbit bus were clear of the roadway except the outer left rear wheel. These
observation appearing in said picture (Exh. P-2, Pascua) clearly shows
coupled with the finding the Rabbit bus came to a full stop only five meters
from the point of impact (see sketch, Exh. K-Pascua) clearly show that driver
de los Reyes veered his Rabbit bus to the right attempting to avoid hitting the
Mangune's jeepney. That it was not successful in fully clearing the Mangune
jeepney as its (Rabbit's) left front hit said jeepney (see picture Exh. 10-ARabbit) must have been due to limitations of space and time."Plaintiffs
alternatively claim that defendant delos Reyes of the Rabbit bus could also
have swerved to its left (eastern lane) to avoid bumping the Mangune jeepney
which was then on the western lane. Such a claim is premised on the
hypthesis (sic) that the eastern lane was then empty. This claim would appear
to be good copy of it were based alone on the sketch made after the collision.
Nonetheless, it loses force it one were to consider the time element involved,
for moments before that, the Mangune jeepney was crossing that very eastern
lane at a sharp angle. Under such a situation then, for driver delos Reyes to
swerve to the eastern lane, he would run the greater risk of running smack in
the Mangune jeepney either head on or broadside."After a minute scrutiny of
the factual matters and duly proven evidence, We find that the proximate
cause of the accident was the negligence of Manalo and spouses Mangune
and Carreon. They all failed to exercise the precautions that are needed
precisely pro hac vice.

In culpa contractual, the moment a passenger dies or is injured, the carrier is

presumed to have been at fault or to have acted negligently, and this
disputable presumption may only be overcome by evidence that he had
observed extra-ordinary diligence as prescribed in Articles 1733, 1755 and
1756 of the New Civil Code or that the death or injury of the passenger was
due to a fortuitous event (Lasam v. Smith, Jr., 45 Phil. 657).

The negligence of Manalo was proven during the trial by the unrebutted
testimonies of Caridad Pascua, Police Investigator Tacpal, Police Corporal
Cacalda, his (Manalo's) conviction for the crime of Multiple Homicide and
Multiple Serious Injuries with Damage to Property thru Reckless Imprudence,
and the application of the doctrine of res ipsa loquitur, supra. The negligence
of spouses Mangune and Carreon was likewise proven during the trial (p. 110,
Record on Appeal):

"To escape liability, defendants, Mangune and Carreon offered to show thru
their witness Natalio Navarro, an alleged mechanic, that he periodically checks
and maintains the jeepney of said defendants, the last on Dec. 23, the day
before the collision, which included the tightening of the bolts. This
notwithstanding the right rear wheel of the vehicle was detached while in
transit. As to the cause thereof no evidence was offered. Said defendant did
not even attempt to explain, much less establish, it to be one caused by a caso
fortuito. x x x."In any event, "[i]n an action for damages against the carrier for
his failure to safely carry his passenger to his destination, an accident caused
either by defects in the automobile or through the negligence of its driver, is

not a caso fortuito which would avoid the carrier's liability for damages (Son v.
Cebu Autobus Company, 94 Phil. 892 citing Lasam, et al. v. Smith, Jr., 45 Phil.
657; Necesito, etc. v. Paras, et al., 104 Phil. 75).

The trial court was therefore right in finding that Manalo and spouses Mangune
and Carreon were negligent. However, its ruling that spouses Mangune and
Carreon are jointly and severally liable with Manalo is erroneous. The driver
cannot be held jointly and severally liable with the carrier in case of breach of
the contract of carriage. The rationale behind this is readily discernible. Firstly,
the contract of carriage is between the carrier and the passenger, and in the
event of contractual liability, the carrier is exclusively responsible therefor to
the passenger, even if such breach be due to the negligence of his driver (see
Viluan v. The Court of Appeals, et al., G.R. Nos. L-21477-81, April 29, 1966, 16
SCRA 742). In other words, the carrier can neither shift his liability on the
contract to his driver nor share it with him, for his driver's negligence is his.
Secondly, if We make the driver jointly and severally liable with the carrier, that
would make the carrier's liability personal instead of merely vicarious and
consequently, entitled to recover only the share which corresponds to the
driver, contradictory to the explicit provision of Article 2181 of the New Civil
Code.

We affirm the amount of damages adjudged by the trial court, except with
respect to the indemnity for loss of life. Under Article 1764 in relation to Article
2206 of the New Civil Code, the amount of damages for the death of a
passenger is at least three thousand pesos (P3,000.00). The prevailing
jurisprudence has increased the amount of P3,000.00 to P30,000.00 (see
Heirs of Amparo delos Santos, et al. v. Honorable Court of Appeals, et al., G.R.
No. 51165, June, 21, 1990 citing De Lima v. Laguna Tayabas Co., G.R. Nos.L35697-99, April 15, 1988, 160 SCRA 70).

ACCORDINGLY, the petition is hereby GRANTED. The decision of the

Intermediate Appellate Court dated July 29, 1983 and its resolution dated
November 28, 1983 are SET ASIDE. The decision of the Court of First
Instance dated December 27, 1978 is REINSTATED WITH MODIFICATION
that only Isidro Mangune, Guillerma Carreon and Filriters Guaranty Assurance
Corporation, Inc. are liable to the victims or their heirs and that the amount of
indemnity for loss of life is increased to thirty thousand pesos (P30,000.00).

SO ORDERED.

Narvasa, (Chairman), Cruz, Gancayco, and Grio-Aquino, JJ., concur.

Republic of the PhilippinesSUPREME COURTManila

EN BANC
G.R. No. L-9907

June 30, 1958

LOURDES J. LARA, ET AL., plaintiffs-appellants, vs.BRIGIDO R.

VALENCIA, defendant-appellant.
Castillo, Cervantes, Occea, Lozano, Montana, Cunanan, Sison and Castillo
and Eligio G. Lagman for defendant-appellant.Donato C. Endriga and Emigdio
Dakanay for plaintiffs-appellants.
BAUTISTA ANGELO, J.:
This is an action for damages brought by plaintiffs against defendant in the
Court of First Instance of Davao for the death of one Demetrio Lara, Sr.
allegedly caused by the negligent act of defendant. Defendant denied the
charge of negligence and set up certain affirmative defenses and a
counterclaim.
The court after hearing rendered judgment ordering defendant to pay the
plaintiffs the following amount: (a) P10,000 as moral damages; (b) P3,000 as
exemplary damages; and (c) P1,000 as attorney's fees, in addition to the costs
of action. Both parties appealed to this Court because the damages claimed in
the complaint exceed the sum of P50,000.
In their appeal, plaintiffs claim that the court a quo erred in disregarding their
claim of P41,400 as actual or compensatory damages and in awarding as
attorneys' fees only the sum of P1,000 instead of P3,000 as agreed upon
between plaintiffs and their counsel. Defendant, on the other hand, disputes
the finding of the court a quo that the oath of Demetrio Lara, Sr. was due to the
negligence of defendant and the portion of the judgment which orders
dependant to pay to plaintiffs moral and exemplary damages as well as
12

attorneys' fees, said defendant contending that the court should have declared
that the death of Lara was due to unavoidable accident.
The deceased was an inspector of the Bureau of Forestry stationed in Davao
with an annual salary of P1,800. The defendant is engaged in the business of
exporting logs from his lumber concession in Cotabato. Lara went to said
concession upon instructions of his chief to classify the logs of defendant
which were about to be loaded on a ship anchored in the port of Parang. The
work Lara of lasted for six days during which he contracted malaria fever. In
the morning of January 9, 1954, Lara who then in a hurry to return to Davao
asked defendant if he could take him in his pick-up as there was then no other
means of transportation, to which defendant agreed, and in that same morning
the pick-up left Parang bound for Davao taking along six passengers, including
Lara.
The pick-up has a front seat where the driver and two passengers can be
accommodated and the back has a steel flooring enclosed with a steel walling
of 16 to 17 inches tall on the sides and with a 19 inches tall walling at the back.
Before leaving Parang, the sitting arrangement was as follows: defendant was
at the wheel and seated with him in the front seat were Mrs. Valencia and
Nicanor Quinain; on the back of the pick-up were two improvised benches
placed on each side, and seated on the right bench were Ricardo Alojipan and
Antonio Lagahit, and on the left one Bernardo and Pastor Geronimo. A person
by the name of Leoning was seated on a box located on the left side while in
the middle Lara sat on a bag. Before leaving Parang, defendant invited Lara to
sit with him on the front seat but Lara declined. It was their understanding that
upon reaching barrio Samoay, Cotabato, the passengers were to alight and
take a bus bound for Davao, but when they arrived at that place, only
Bernardo alighted and the other passengers requested defendant to allow
them to ride with him up to Davao because there was then no available bus
that they could take in going to that place. Defendant again accommodated the
passengers.
When they continued their trip, the sitting arrangement of the passengers
remained the same, Lara being seated on a bag in the middle with his arms on
a suitcase and his head cove red by a jacket. Upon reaching Km. 96, barrio
Catidtuan, Lara accidentally fell from the pick-up and as a result he suffered
serious injuries. Valencia stopped the pick-up to see what happened to Lara.
He sought the help of the residents of that place and applied water to Lara but
to no avail. They brought Lara to the nearest place where they could find a
doctor and not having found any they took him to St. Joseph's Clinic of
Kidapawan. But when Lara arrived he was already dead. From there they
proceeded to Davao City and immediately notified the local authorities. An
investigation was made regarding the circumstances surrounding the death of
Lara but no criminal action was taken against defendant.
It should be noted that the deceased went to the lumber concession of
defendant in Parang, Cotabato upon instructions of his chief in order to classify
the logs of defendant which were then ready to be exported and to be loaded
on a ship anchored in the port of Parang. It took Lara six days to do his work
during which he contracted malaria fever and for that reason he evinced a
desire to return immediately to Davao. At that time, there was no available bus
that could take him back to Davao and so he requested the defendant if he
could take him in his own pick-up. Defendant agreed and, together with Lara,
other passengers tagged along, most of them were employees of the
Government. Defendant merely accommodated them and did not charge them
any fee for the service. It was also their understanding that upon reaching
barrio Samoay, the passengers would alight and transfer to a bus that
regularly makes the trip to Davao but unfortunately there was none available at
the time and so the same passengers, including Lara, again requested the
defendant to drive them to Davao. Defendant again accommodated them and
upon reaching Km. 96, Lara accidentally fell suffering fatal injuries.
It therefore appears that the deceased, as well his companions who rode in
the pick-up of defendant, were merely accommodation passengers who paid
nothing for the service and so they can be considered as invited guests within
the meaning of the law. As accommodation passengers or invited guests,
defendant as owner and driver of the pick-up owes to them merely the duty to
exercise reasonable care so that they may be transported safely to their
destination. Thus, "The rule is established by the weight of authority that the
owner or operator of an automobile owes the duty to an invited guest to
exercise reasonable care in its operation, and not unreasonably to expose him
to danger and injury by increasing the hazard of travel. This rule, as frequently
stated by the courts, is that an owner of an automobile owes a guest the duty
to exercise ordinary or reasonable care to avoid injuring him. Since one riding
in an automobile is no less a guest because he asked for the privilege of doing
so, the same obligation of care is imposed upon the driver as in the case of
one expressly invited to ride" (5 Am. Jur., 626-627). Defendant, therefore, is
only required to observe ordinary care, and is not in duty bound to exercise
extraordinary diligence as required of a common carrier by our law (Articles
1755 and 1756, new Civil Code).

into account only the following facts:

No debe perderse de vista el hecho, que los negocios de exportacion de
trozos del demandado tiene un volumen de P1,200. Lara era empleado de la
Oficina de Montes, asalariado por el gobierno, no pagado por el demandado
para classificar los trozos exportados; debido a los trabajos de classificacion
que duro 6 dias, en su ultimo dia Lara no durmio toda la noche, al dia
siguiente, Lara fue atacado de malaria, tenia inflamada la cara y cuerpo, sufria
dolores de cabeza con erupciones en la cara y cuerpo; que en la manana, del
dia 2 de enero de 1954, fecha en que Lara salio de Davao para Parang, en
aeroplano para clasificar los trozos del demandado, el automobil de este
condujo a aquel al aerodromo de Davao.
xxx

xxx

xxx

El viaje de Cotabato a Davao no es menos de 8 horas, su carretera esta en

malas condiciones, desnivelada, con piedras salientes y baches, que hacen
del vehiculo no estable en su marcha. Lara estaba enfermo de cierta
gravedad, tenia el cuerpo y cara inflamados, atacado de malaria, con dolores
de cabeza y con erupciones en la cara y cuerpo.
A la vista de estos hechos, el demandado debia de saber que era sumamente
peligroso llevar 5 pasajeros en la parte trasera del pick-up; particularmente,
para la salud de Lara; el permitirlo, el demandado no ha tomado las
precausiones, para evitar un posible accidente fatal. La negative de Lara de
ocupar el asiento delantero del pick-up no constituye a juicio del Juzgado una
defensa, pues el demendado conociendo el estado delicado de salud de Lara,
no debio de haber permitido que aquel regrese a Davao en su pick-up; si
querria prestar a aquel un favor, debio de haver provisto a Lara de un
automobil para su regrese a Davao, ya que el demendado es un millionario; si
no podia prestar a aquel este favor, debio de haver dejado a Lara en Samuay
para coger aquel un camion de pasajero de Cotabato a Davao.
Even if we admit as true the facts found by the trial court, still we find that the
same are not sufficient to show that defendant has failed to take the
precaution necessary to conduct his passengers safely to their place of
destination for there is nothing there to indicate that defendant has acted with
negligence or without taking the precaution that an ordinary prudent man
would have taken under similar circumstances. It should be noted that Lara
went to the lumber concession of defendant in answer to a call of duty which
he was bound to perform because of the requirement of his office and he
contracted the malaria fever in the course of the performance of that duty. It
should also be noted that defendant was not in duty bound to take the
deceased in his own pick-up to Davao because from Parang to Cotabato there
was a line of transportation that regularly makes trips for the public, and if
defendant agreed to take the deceased in his own car, it was only to
accommodate him considering his feverish condition and his request that he
be so accommodated. It should also be noted that the passengers who rode in
the pick-up of defendant took their respective seats therein at their own choice
and not upon indication of defendant with the particularity that defendant
invited the deceased to sit with him in the front seat but which invitation the
deceased declined. The reason for this can only be attributed to his desire to
be at the back so that he could sit on a bag and travel in a reclining position
because such was more convenient for him due to his feverish condition. All
the circumstances therefore clearly indicate that defendant had done what a
reasonable prudent man would have done under the circumstances.
There is every reason to believe that the unfortunate happening was only due
to an unforeseen accident accused by the fact that at the time the deceased
was half asleep and must have fallen from the pick-up when it ran into some
stones causing it to jerk considering that the road was then bumpy, rough and
full of stones.
The finding of the trial court that the pick-up was running at more than 40
kilometers per hour is not supported by the evidence. This is a mere surmise
made by the trial court considering the time the pick-up left barrio Samoay and
the time the accident occured in relation to the distance covered by the pickup. And even if this is correct, still we say that such speed is not unreasonable
considering that they were traveling on a national road and the traffic then was
not heavy. We may rather attribute the incident to lack of care on the part of
the deceased considering that the pick-up was open and he was then in a
crouching position. Indeed, the law provides that "A passenger must observe
the diligence of a good father of a family to avoid injury to himself" (Article
1761, new Civil Code), which means that if the injury to the passenger has
been proximately caused by his own negligence, the carrier cannot be held
liable.
All things considered, we are persuaded to conclude that the accident
occurred not due to the negligence of defendant but to circumstances beyond
his control and so he should be exempt from liability.

The question that now arises is: Is there enough evidence to show that
defendant failed to observe ordinary care or diligence in transporting the
deceased from Parang to Davao on the date in question?

Wherefore, the decision appealed from is reversed, without pronouncement as

to costs.

The trial court answered the question in the affirmative but in so doing it took

Paras, C. J., Bengzon, Reyes, A., Concepcion, Reyes, J. B. L., Endencia and
13

Felix, JJ., concur.

ect - Arellano Law Foundation
G.R. No. L-10605
June 30, 1958

PRECILLANO NECESITO, ETC., plaintiff-appellant, vs.NATIVIDAD

PARAS, ET AL., defendants-appellees.
x---------------------------------------------------------x
G.R. No. L-10606

June 30, 1958

GERMAN NECESITO, ET AL., plaintiffs-appellants, vs.NATIVIDAD PARAS,

ET AL., defendants-appellees.
Tomas Besa and Federico Agrava for appellants.Jose W. Diokno for
appellees.
REYES, J. B. L., J.:
These cases involve ex contractu against the owners and operators of the
common carrier known as Philippine Rabbit Bus Lines, filed by one passenger,
and the heirs of another, who injured as a result of the fall into a river of the
vehicle in which they were riding.
In the morning of January 28, 1964, Severina Garces and her one-year old
son, Precillano Necesito, carrying vegetables, boarded passenger auto truck
or bus No. 199 of the Philippine Rabbit Bus Lines at Agno, Pangasinan. The
passenger truck, driven by Francisco Bandonell, then proceeded on its regular
run from Agno to Manila. After passing Mangatarem, Pangasinan truck No.
199 entered a wooden bridge, but the front wheels swerved to the right; the
driver lost control, and after wrecking the bridge's wooden rails, the truck fell
on its right side into a creek where water was breast deep. The mother,
Severina Garces, was drowned; the son, Precillano Necesito, was injured,
suffering abrasions and fracture of the left femur. He was brought to the
Provincial Hospital at Dagupan, where the fracture was set but with fragments
one centimeter out of line. The money, wrist watch and cargo of vegetables
were lost.
Two actions for damages and attorney's fees totalling over P85,000 having
been filed in the Court of First Instance of Tarlac (Cases Nos. 908 and 909)
against the carrier, the latter pleaded that the accident was due to "engine or
mechanical trouble" independent or beyond the control of the defendants or of
the driver Bandonell.
After joint trial, the Court of First Instance found that the bus was proceeding
slowly due to the bad condition of the road; that the accident was caused by
the fracture of the right steering knuckle, which was defective in that its center
or core was not compact but "bubbled and cellulous", a condition that could
not be known or ascertained by the carrier despite the fact that regular thirtyday inspections were made of the steering knuckle, since the steel exterior
was smooth and shiny to the depth of 3/16 of an inch all around; that the
knuckles are designed and manufactured for heavy duty and may last up to
ten years; that the knuckle of bus No. 199 that broke on January 28, 1954,
was last inspected on January 5, 1954, and was due to be inspected again on
February 5th. Hence, the trial court, holding that the accident was exclusively
due to fortuitous event, dismissed both actions. Plaintiffs appealed directly to
this Court in view of the amount in controversy.
We are inclined to agree with the trial court that it is not likely that bus No. 199
of the Philippine Rabbit Lines was driven over the deeply rutted road leading to
the bridge at a speed of 50 miles per hour, as testified for the plaintiffs. Such
conduct on the part of the driver would have provoked instant and vehement
protest on the part of the passengers because of the attendant discomfort, and
there is no trace of any such complaint in the records. We are thus forced to
assume that the proximate cause of the accident was the reduced strength of
the steering knuckle of the vehicle caused by defects in casting it. While
appellants hint that the broken knuckle exhibited in court was not the real
fitting attached to the truck at the time of the accident, the records they
registered no objection on that ground at the trial below. The issue is thus
reduced to the question whether or not the carrier is liable for the
manufacturing defect of the steering knuckle, and whether the evidence
discloses that in regard thereto the carrier exercised the diligence required by
law (Art. 1755, new Civil Code).
ART. 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 the all the circumstances.
It is clear that the carrier is not an insurer of the passengers' safety. His liability
rests upon negligence, his failure to exercise the "utmost" degree of diligence
that the law requires, and by Art. 1756, in case of a passenger's death or injury

the carrier bears the burden of satisfying the court that he has duly discharged
the duty of prudence required. In the American law, where the carrier is held to
the same degree of diligence as under the new Civil Code, the rule on the
liability of carriers for defects of equipment is thus expressed: "The
preponderance of authority is in favor of the doctrine that a passenger is
entitled to recover damages from a carrier for an injury resulting from a defect
in an appliance purchased from a manufacturer, whenever it appears that the
defect would have been discovered by the carrier if it had exercised the
degree of care which under the circumstances was incumbent upon it, with
regard to inspection and application of the necessary tests. For the purposes
of this doctrine, the manufacturer is considered as being in law the agent or
servant of the carrier, as far as regards the work of constructing the appliance.
According to this theory, the good repute of the manufacturer will not relieve
the carrier from liability" (10 Am. Jur. 205, s, 1324; see also Pennsylvania R.
Co. vs. Roy, 102 U. S. 451; 20 L. Ed. 141; Southern R. Co. vs. Hussey, 74
ALR 1172; 42 Fed. 2d 70; and Ed Note, 29 ALR 788; Ann. Cas. 1916E 929).
The rationale of the carrier's liability is the fact that the passenger has neither
choice nor control over the carrier in the selection and use of the equipment
and appliances in use by the carrier. Having no privity whatever with the
manufacturer or vendor of the defective equipment, the passenger has no
remedy against him, while the carrier usually has. It is but logical, therefore,
that the carrier, while not in insurer of the safety of his passengers, should
nevertheless be held to answer for the flaws of his equipment if such flaws
were at all discoverable. Thus Hannen, J., in Francis vs. Cockrell, LR 5 Q. B.
184, said:
In the ordinary course of things, the passenger does not know whether the
carrier has himself manufactured the means of carriage, or contracted with
someone else for its manufacture. If the carrier has contracted with someone
else the passenger does not usually know who that person is, and in no case
has he any share in the selection. The liability of the manufacturer must
depend on the terms of the contract between him and the carrier, of which the
passenger has no knowledge, and over which he can have no control, while
the carrier can introduce what stipulations and take what securities he may
think proper. For injury resulting to the carrier himself by the manufacturer's
want of care, the carrier has a remedy against the manufacturer; but the
passenger has no remedy against the manufacturer for damage arising from a
mere breach of contract with the carrier . . . . Unless, therefore, the presumed
intention of the parties be that the passenger should, in the event of his being
injured by the breach of the manufacturer's contract, of which he has no
knowledge, be without remedy, the only way in which effect can be given to a
different intention is by supposing that the carrier is to be responsible to the
passenger, and to look for his indemnity to the person whom he selected and
whose breach of contract has caused the mischief. (29 ALR 789)
And in the leading case of Morgan vs. Chesapeake & O. R. Co. 15 LRA (NS)
790, 16 Ann. Cas. 608, the Court, in holding the carrier responsible for
damages caused by the fracture of a car axle, due to a "sand hole" in the
course of moulding the axle, made the following observations.
The carrier, in consideration of certain well-known and highly valuable rights
granted to it by the public, undertakes certain duties toward the public, among
them being to provide itself with suitable and safe cars and vehicles in which
carry the traveling public. There is no such duty on the manufacturer of the
cars. There is no reciprocal legal relation between him and the public in this
respect. When the carrier elects to have another build its cars, it ought not to
be absolved by that facts from its duty to the public to furnish safe cars. The
carrier cannot lessen its responsibility by shifting its undertaking to another's
shoulders. Its duty to furnish safe cars is side by side with its duty to furnish
safe track, and to operate them in a safe manner. None of its duties in these
respects can be sublet so as to relieve it from the full measure primarily
exacted of it by law. The carrier selects the manufacturer of its cars, if it does
not itself construct them, precisely as it does those who grade its road, and lay
its tracks, and operate its trains. That it does not exercise control over the
former is because it elects to place that matter in the hands of the
manufacturer, instead of retaining the supervising control itself. The
manufacturer should be deemed the agent of the carrier as respects its duty to
select the material out of which its cars and locomotive are built, as well as in
inspecting each step of their construction. If there be tests known to the crafts
of car builders, or iron moulders, by which such defects might be discovered
before the part was incorporated into the car, then the failure of the
manufacturer to make the test will be deemed a failure by the carrier to make
it. This is not a vicarious responsibility. It extends, as the necessity of this
business demands, the rule of respondeat superior to a situation which falls
clearly within its scope and spirit. Where an injury is inflicted upon a passenger
by the breaking or wrecking of a part of the train on which he is riding, it is
presumably the result of negligence at some point by the carrier. As stated by
Judge Story, in Story on Bailments, sec. 601a: "When the injury or damage
happens to the passenger by the breaking down or overturning of the coach,
or by any other accident occurring on the ground, the presumption prima facie
is that it occurred by the negligence of the coachmen, and onus probandi is on
the proprietors of the coach to establish that there has been no negligence
whatever, and that the damage or injury has been occasioned by inevitable
casualty, or by some cause which human care and foresight could not prevent;
for the law will, in tenderness to human life and limb, hold the proprietors liable
for the slightest negligence, and will compel them to repel by satisfactory
proofs every imputation thereof." When the passenger has proved his injury as
the result of a breakage in the car or the wrecking of the train on which he was
being carried, whether the defect was in the particular car in which he was
14

riding or not, the burden is then cast upon the carrier to show that it was due to
a cause or causes which the exercise of the utmost human skill and foresight
could not prevent. And the carrier in this connection must show, if the accident
was due to a latent defect in the material or construction of the car, that not
only could it not have discovered the defect by the exercise of such care, but
that the builders could not by the exercise of the same care have discovered
the defect or foreseen the result. This rule applies the same whether the
defective car belonged to the carrier or not.

were injured; (2) the damages awarded, that appellees argue to be excessive;
and (3) the award of attorneys' fees.

In the case now before us, the record is to the effect that the only test applied
to the steering knuckle in question was a purely visual inspection every thirty
days, to see if any cracks developed. It nowhere appears that either the
manufacturer or the carrier at any time tested the steering knuckle to ascertain
whether its strength was up to standard, or that it had no hidden flaws would
impair that strength. And yet the carrier must have been aware of the critical
importance of the knuckle's resistance; that its failure or breakage would result
in loss of balance and steering control of the bus, with disastrous effects upon
the passengers. No argument is required to establish that a visual inspection
could not directly determine whether the resistance of this critically important
part was not impaired. Nor has it been shown that the weakening of the
knuckle was impossible to detect by any known test; on the contrary, there is
testimony that it could be detected. We are satisfied that the periodical visual
inspection of the steering knuckle as practiced by the carrier's agents did not
measure up to the required legal standard of "utmost diligence of very cautious
persons" "as far as human care and foresight can provide", and therefore
that the knuckle's failure can not be considered a fortuitous event that exempts
the carrier from responsibility (Lasam vs. Smith, 45 Phil. 657; Son vs. Cebu
Autobus Co., 94 Phil., 892.)

As far as the record shows, the accident was caused either by defects in the
automobile or else through the negligence of its driver. That is not caso
fortuito.

It may be impracticable, as appellee argues, to require of carriers to test the

strength of each and every part of its vehicles before each trip; but we are of
the opinion that a due regard for the carrier's obligations toward the traveling
public demands adequate periodical tests to determine the condition and
strength of those vehicle portions the failure of which may endanger the safe
of the passengers.
As to the damages suffered by the plaintiffs, we agree with appellee that no
allowance may be made for moral damages, since under Article 2220 of the
new Civil Code, in case of suits for breach of contract, moral damages are
recoverable only where the defendant acted fraudulently or in bad faith, and
there is none in the case before us. As to exemplary damages, the carrier has
not acted in a "wanton, fraudulent, reckless, oppressive or malevolent manner"
to warrant their award. Hence, we believe that for the minor Precillano
Necesito (G. R. No. L-10605), an indemnity of P5,000 would be adequate for
the abrasions and fracture of the femur, including medical and hospitalization
expenses, there being no evidence that there would be any permanent
impairment of his faculties or bodily functions, beyond the lack of anatomical
symmetry. As for the death of Severina Garces (G. R. No. L-10606) who was
33 years old, with seven minor children when she died, her heirs are obviously
entitled to indemnity not only for the incidental loses of property (cash, wrist
watch and merchandise) worth P394 that she carried at the time of the
accident and for the burial expenses of P490, but also for the loss of her
earnings (shown to average P120 a month) and for the deprivation of her
protection, guidance and company. In our judgment, an award of P15,000
would be adequate (cf Alcantara vs. Surro, 49 Off. Gaz. 2769; 93 Phil., 472).
The low income of the plaintiffs-appellants makes an award for attorney's fees
just and equitable (Civil Code, Art. 2208, par. 11). Considering that he two
cases filed were tried jointly, a fee of P3,500 would be reasonable.
In view of the foregoing, the decision appealed from is reversed, and the
defendants-appellees are sentenced to indemnify the plaintiffs-appellants in
the following amounts: P5,000 to Precillano Necesito, and P15,000 to the heirs
of the deceased Severina Garces, plus P3,500 by way of attorney's fees and
litigation expenses. Costs against defendants-appellees. So ordered.
Paras, C. J., Bengzon, Reyes, A., Bautista Angelo, Concepcion, and
Endencia, JJ., concur.
Felix, J., concurs in the result.

RESOLUTION

September 11, 1958

REYES, J. B. L., J.:

Defendants-appellees have Submitted a motion asking this Court to reconsider
its decision of June 30, 1958, and that the same be modified with respect to
(1) its holding the carrier liable for the breakage of the steering knuckle that
caused the autobus No. 199 to overturn, whereby the passengers riding in it

(1) The rule prevailing in this jurisdiction as established in previous decisions

of this Court, cited in our main opinion, is that a carrier is liable to its
passengers for damages caused by mechanical defects of the conveyance. As
early as 1924, in Lasam vs. Smith, 45 Phil. 659 this Court ruled:

And in Son vs. Cebu Autobus Company, 94 Phil., 892, this Court held a
common carrier liable in damages to passenger for injuries cause by an
accident due to the breakage of a faulty drag-link spring.
It can be seen that while the courts of the United States are at variance on the
question of a carrier's liability for latent mechanical defects, the rule in this
jurisdiction has been consistent in holding the carrier responsible. This Court
has quoted from American and English decisions, not because it felt bound to
follow the same, but merely in approval of the rationale of the rule as
expressed therein, since the previous Philippine cases did not enlarge on the
ideas underlying the doctrine established thereby.
The new evidence sought to be introduced do not warrant the grant of a new
trial, since the proposed proof available when the original trial was held. Said
evidence is not newly discovered.
(2) With regard to the indemnity awarded to the child Precilliano Necesito, the
injuries suffered by him are incapable of accurate pecuniary estimation,
particularly because the full effect of the injury is not ascertainable
immediately. This uncertainty, however, does not preclude the right to an
indemnity, since the injury is patent and not denied (Civil Code, Art. 2224). The
reasons behind this award are expounded by the Code Commission in its
report:
There are cases where from the nature of the case, definite proof of pecuniary
loss cannot be offered, although the court is convinced that there has been
such loss. For instance, injury to one's commercial credit or to the goodwill of a
business firm is often hard to show with certainty in terms of money. Should
damages be denied for that reason? The judge should be empowered to
calculate moderate damages in such cases, rather than that the plaintiff should
suffer, without redress, from the defendant's wrongful act." (Report of the Code
Commission, p. 75)
In awarding to the heirs of the deceased Severina Garces an indemnity for the
loss of her "guidance, protection and company," although it is but moral
damage, the Court took into account that the case of a passenger who dies in
the course of an accident, due to the carrier's negligence constitutes an
exception to the general rule. While, as pointed out in the main decision, under
Article 2220 of the new Civil Code there can be no recovery of moral damages
for a breach of contract in the absence of fraud malice or bad faith, the case of
a violation of the contract of carriage leading to a passenger's death escapes
this general rule, in view of Article 1764 in connection with Article 2206, No. 3
of the new Civil Code.
ART. 1764. Damages in cases comprised in this Section shall be awarded in
accordance with Title XVIII of this Book, concerning Damages. Article 2206
shall also apply to the death of a passenger caused by the breach of contract
by a comman carrier. ART. 2206. . . .
(3) The spouse, legitimate and eligimate descendants and ascendants of the
deceased may demand moral damages for mental anguish by reason of the
death of the deceased.
Being a special rule limited to cases of fatal injuries, these articles prevail over
the general rule of Art. 2220. Special provisions control general ones
(Lichauco & Co. vs. Apostol, 44 Phil. 138; Sancio vs. Lizarraga, 55 Phil. 601).
It thus appears that under the new Civil Code, in case of accident due to a
carrier's negligence, the heirs of a deceased passenger may recover moral
damages, even though a passenger who is injured, but manages to survive, is
not entitled to them. There is, therefore, no conflict between our main decision
in the instant case and that of Cachero vs. Manila Yellow Taxi Cab Co., 101
Phil., 523, where the passenger suffered injuries, but did not lose his life.
(3) In the Cachero case this Court disallowed attorneys' fees to the injured
plaintiff because the litigation arose out of his exaggerated and unreasonable
deeds for an indemnity that was out of proportion with the compensatory
damages to which he was solely entitled. But in the present case, plaintiffs'
original claims can not be deemed a priori wholly unreasonable, since they
had a right to indemnity for moral damages besides compensatory ones, and
moral damages are not determined by set and invariable bounds.
15

Neither does the fact that the contract between the passengers and their
counsel was on a contingent basis affect the former's right to counsel fees. As
pointed out for appellants, the Court's award is an party and not to counsel. A
litigant who improvidently stipulate higher counsel fees than those to which he
is lawfully entitled, does not for that reason earn the right to a larger indemnity;
but, by parity of reasoning, he should not be deprived of counsel fees if by law
he is entitled to recover them.
We find no reason to alter the main decision heretofore rendered. Ultimately,
the position taken by this Court is that a common carrier's contract is not to be
regarded as a game of chance wherein the passenger stakes his limb and life
against the carrier's property and profits.
Wherefore, the motion for reconsideration is hereby denied. So ordered.
Paras, C. J., Bengzon, Padilla, Montemayor, Reyes, A., Bautista Angelo,
Concepcion, Endencia, and Felix, JJ., concur.

G.R. No. 118664

August 7, 1998

JAPAN AIRLINES, petitioner,

vs.
THE COURT OF APPEALS, ENRIQUE AGANA., MARIA ANGELA
NINA AGANA, ADALIA B. FRANCISCO and JOSE MIRANDA,
respondents.
ROMERO, J.:
Before us is an appeal by certiorari filed by petitioner Japan Airlines, Inc. (JAL)
seeking the reversal of the decision of the Court of Appeals, 1 which affirmed
with modification the award of damages made by the trial court in favor of
herein private respondents Enrique Agana, Maria Angela Nina Agana, Adelia
Francisco and Jose Miranda.
On June 13, 1991, private respondent Jose Miranda boarded JAL flight No. JL
001 in San Francisco, California bound for Manila. Likewise, on the same day
private respondents Enrique Agana, Maria Angela Nina Agana and Adelia
Francisco left Los Angeles, California for Manila via JAL flight No. JL 061. As
an incentive for travelling on the said airline, both flights were to make an
overnight stopover at Narita, Japan, at the airlines' expense, thereafter
proceeding to Manila the following day.
Upon arrival at Narita, Japan on June 14, 1991, private respondents were
billeted at Hotel Nikko Narita for the night. The next day, private respondents,
on the final leg of their journey, went to the airport to take their flight to Manila.
However, due to the Mt. Pinatubo eruption, unrelenting ashfall blanketed Ninoy
Aquino International Airport (NAIA), rendering it inaccessible to airline traffic.
Hence, private respondents' trip to Manila was cancelled indefinitely.
To accommodate the needs of its stranded passengers, JAL rebooked all the
Manila-bound passengers on flight No. 741 due to depart on June 16, 1991
and also paid for the hotel expenses for their unexpected overnight stay. On
June 16, 1991, much to the dismay of the private respondents, their long
anticipated flight to Manila was again cancelled due to NAIA's indefinite
closure. At this point, JAL informed the private respondents that it would no
longer defray their hotel and accommodation expense during their stay in
Narita.
Since NAIA was only reopened to airline traffic on June 22, 1991, private
respondents were forced to pay for their accommodations and meal expenses
from their personal funds from June 16 to June 21, 1991. Their unexpected
stay in Narita ended on June 22, 1991 when they arrived in Manila on board
JL flight No. 741.

respondents holding JAL liable for damages, viz.:

WHEREFORE, judgment is rendered in favor of plaintiffs ordering the
defendant Japan Airlines to pay the plaintiffs Enrique Agana, Adalia B.
Francisco and Maria Angela Nina Agana the sum of One million Two Hundred
forty-six Thousand Nine Hundred Thirty-Six Pesos (P1,246,936.00) and Jose
Miranda the sum of Three Hundred Twenty Thousand Six Hundred sixteen and
31/100 (P320,616.31) as actual, moral and exemplary damages and pay
attorney's fees in the amount of Two Hundred Thousand Pesos (P200,000.00),
and to pay the costs of suit.
Undaunted, JAL appealed the decision before the Court of Appeals, which,
however, with the exception of lowering the damages awarded affirmed the
trial court's finding, 3 thus:
Thus, the award of moral damages should be as it is hereby reduced to
P200,000.00 for each of the plaintiffs, the exemplary damages to P300,000.00
and the attorney's fees to P100,000.00 plus the costs.
WHEREFORE, with the foregoing Modification, the judgment appealed from is
hereby AFFIRMED in all other respects.
JAL filed a motion for reconsideration which proved futile and
unavailing. 4
Failing in its bid to reconsider the decision, JAL has now filed this instant
petition.
The issue to be resolved is whether JAL, as a common carrier has the
obligation to shoulder the hotel and meal expenses of its stranded passengers
until they have reached their final destination, even if the delay were caused
by "force majeure."
To begin with, there is no dispute that the Mt. Pinatubo eruption prevented JAL
from proceeding to Manila on schedule. Likewise, private respondents
concede that such event can be considered as "force majeure" since their
delayed arrival in Manila was not imputable to JAL. 5
However, private respondents contend that while JAL cannot be held
responsible for the delayed arrival in Manila, it was nevertheless liable for their
living expenses during their unexpected stay in Narita since airlines have the
obligation to ensure the comfort and convenience of its passengers. While we
sympathize with the private respondents' plight, we are unable to accept this
contention.
We are not unmindful of the fact that in a plethora of cases we have
consistently ruled that a contract to transport passengers is quite different in
kind, and degree from any other contractual relation. It is safe to conclude that
it is a relationship imbued with public interest. Failure on the part of the
common carrier to live up to the exacting standards of care and diligence
renders it liable for any damages that may be sustained by its passengers.
However, this is not to say that common carriers are absolutely responsible for
all injuries or damages even if the same were caused by a fortuitous event. To
rule otherwise would render the defense of "force majeure," as an exception
from any liability, illusory and ineffective.

Accordingly, there is no question that when a party is unable to fulfill his

obligation because of "force majeure," the general rule is that he cannot be
held liable for damages for non-performance. 6 Corollarily, when JAL was
prevented from resuming its flight to Manila due to the effects of Mt. Pinatubo
eruption, whatever losses or damages in the form of hotel and meal expenses
the stranded passengers incurred, cannot be charged to JAL. Yet it is
undeniable that JAL assumed the hotel expenses of respondents for their
unexpected overnight stay on June 15, 1991.

Obviously, still reeling from the experience, private respondents, on July 25,
1991, commenced an action for damages against JAL before the Regional
Trial Court of Quezon City, Branch 104. 2 To support their claim, private
respondents asserted that JAL failed to live up to its duty to provide care and
comfort to its stranded passengers when it refused to pay for their hotel and
accommodation expenses from June 16 to 21, 1991 at Narita, Japan. In other
words, they insisted that JAL was obligated to shoulder their expenses as long
as they were still stranded in Narita. On the other hand, JAL denied this
allegation and averred that airline passengers have no vested right to these
amenities in case a flight is cancelled due to "force majeure."

Admittedly, to be stranded for almost a week in a foreign land was an

exasperating experience for the private respondents. To be sure, they
underwent distress and anxiety during their unanticipated stay in Narita, but
their predicament was not due to the fault or negligence of JAL but the closure
of NAIA to international flights. Indeed, to hold JAL, in the absence of bad faith
or negligence, liable for the amenities of its stranded passengers by reason of
a fortuitous event is too much of a burden to assume.

On June 18, 1992, the trial court rendered its judgment in favor of private

Furthermore, it has been held that airline passengers must take such risks
incident to the mode of travel. 7 In this regard, adverse weather conditions or
extreme climatic changes are some of the perils involved in air travel, the
16

consequences of which the passenger must assume or expect. After all,

common carriers are not the insurer of all risks. 8
G.R. No. L-20761
Paradoxically, the Court of Appeals, despite the presence of "force majeure,"
still ruled against JAL relying in our decision in PAL v. Court of Appeals, 9 thus:
The position taken by PAL in this case clearly illustrates its failure to grasp the
exacting standard required by law. Undisputably, PAL's diversion of its flight
due to inclement weather was a fortuitous event. Nonetheless, such
occurrence did not terminate PAL's contract with its passengers. Being in the
business of air carriage and the sole one to operate in the country, PAL is
deemed equipped to deal with situations as in the case at bar. What we said in
one case once again must be stressed, i.e., the relation of carrier and
passenger continues until the latter has been landed at the port of destination
and has left the carrier's premises. Hence, PAL necessarily would still have to
exercise extraordinary diligence in safeguarding the comfort, convenience and
safety of its stranded passengers until they have reached their final
destination. On this score, PAL grossly failed considering the then ongoing
battle between government forces and Muslim rebels in Cotabato City and the
fact that the private respondent was a stranger to the place.
The reliance is misplaced. The factual background of the PAL case is different
from the instant petition. In that case there was indeed a fortuitous event
resulting in the diversion of the PAL flight. However, the unforeseen diversion
was worsened when "private respondents (passenger) was left at the airport
and could not even hitch a ride in a Ford Fiera loaded with PAL personnel," 10
not to mention the apparent apathy of the PAL station manager as to the
predicament of the stranded passengers. 11 In light of these circumstances,
we held that if the fortuitous event was accompanied by neglect and
malfeasance by the carrier's employees, an action for damages against the
carrier is permissible. Unfortunately, for private respondents, none of these
conditions are present in the instant petition.
We are not prepared, however, to completely absolve petitioner JAL from any
liability. It must be noted that private respondents bought tickets from the
United States with Manila as their final destination. While JAL was no longer
required to defray private respondents' living expenses during their stay in
Narita on account of the fortuitous event, JAL had the duty to make the
necessary arrangements to transport private respondents on the first available
connecting flight to Manila. Petitioner JAL reneged on its obligation to look
after the comfort and convenience of its passengers when it declassified
private respondents from "transit passengers" to "new passengers" as a result
of which private respondents were obliged to make the necessary
arrangements themselves for the next flight to Manila. Private respondents
were placed on the waiting list from June 20 to June 24. To assure themselves
of a seat on an available flight, they were compelled to stay in the airport the
whole day of June 22, 1991 and it was only at 8:00 p.m. of the aforesaid date
that they were advised that they could be accommodated in said flight which
flew at about 9:00 a.m. the next day.
We are not oblivious to the fact that the cancellation of JAL flights to Manila
from June 15 to June 21, 1991 caused considerable disruption in passenger
booking and reservation. In fact, it would be unreasonable to expect,
considering NAIA's closure, that JAL flight operations would be normal on the
days affected. Nevertheless, this does not excuse JAL from its obligation to
make the necessary arrangements to transport private respondents on its first
available flight to Manila. After all, it had a contract to transport private
respondents from the United States to Manila as their final destination.
Consequently, the award of nominal damages is in order. Nominal damages
are adjudicated in order that a right of a plaintiff, which has been violated or
invaded by the defendant, may be vindicated or recognized and not for the
purpose of indemnifying any loss suffered by him. 12 The court may award
nominal damages in every obligation arising from any source enumerated in
article 1157, or in every case where any property right has been invaded. 13

WHEREFORE, in view of the foregoing, the decision of the Court of Appeals

dated December 22, 1993 is hereby MODIFIED. The award of actual, moral
and exemplary damages is hereby DELETED. Petitioner JAL is ordered to pay
each of the private respondents nominal damages in the sum of P100,000.00
each including attorney' s fees of P50,000.00 plus costs.

SO ORDERED.

Narvasa, C.J., Kapunan and Purisima, JJ., concur.

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 CAG.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 4 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
17

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.1 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.

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.

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.2 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.3

ABOITIZ SHIPPING CORPORATION, petitioner,

vs.
HON. COURT OF APPEALS, ELEVENTH DIVISION, LUCILA C.
VIANA, SPS. ANTONIO VIANA and GORGONIA VIANA, and
PIONEER STEVEDORING CORPORATION, respondents.

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.

In this appeal by certiorari, petitioner Aboitiz Shipping Corporation seeks a

review of the decision 1 of respondent Court of Appeals, dated July 29, 1988,
the decretal portion of which reads:

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.4
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.5 Herein petitioner's
contention, therefore, that the Court of Appeals committed error in raising the
amount of the award for damages is, evidently, meritorious.1wph1.t
Wherefore, the decision of the Court of Appeals is hereby modified by

Concepcion, C.J., Reyes, J.B.L., Dizon, Regala, Bengzon, J.P., Zaldivar,

Sanchez and Castro, JJ., concur.
Makalintal, J., concurs in the result.

G.R. No. 84458

November 6, 1989

Herenio E. Martinez for petitioner.

M.R. Villaluz Law Office for private respondent.

REGALADO, J.:

WHEREFORE, the judgment appealed from as modified by the order of

October 27, 1982, is hereby affirmed with the modification that appellant
Aboitiz Shipping is hereby ordered to pay plaintiff-appellees the amount of
P30,000.00 for the death of Anacleto Viana; actual damages of P9,800.00;
P150,000.00 for unearned income; P7,200.00 as support for deceased's
parents; P20,000.00 as moral damages; P10,000.00 as attorney's fees; and to
pay the costs.
The undisputed facts of the case, as found by the court a quo and adopted by
respondent court, are as follows: .
The evidence disclosed that on May 11, 1975, Anacleto Viana boarded the
vessel M/V Antonia, owned by defendant, at the port at San Jose, Occidental
Mindoro, bound for Manila, having purchased a ticket (No. 117392) in the sum
of P23.10 (Exh. 'B'). On May 12, 1975, said vessel arrived at Pier 4, North
Harbor, Manila, and the passengers therein disembarked, a gangplank having
been provided connecting the side of the vessel to the pier. Instead of using
said gangplank Anacleto Viana disembarked on the third deck which was on
the level with the pier. After said vessel had landed, the Pioneer Stevedoring
Corporation took over the exclusive control of the cargoes loaded on said
vessel pursuant to the Memorandum of Agreement dated July 26, 1975 (Exh.
'2') between the third party defendant Pioneer Stevedoring Corporation and
defendant Aboitiz Shipping Corporation.
The crane owned by the third party defendant and operated by its crane
operator Alejo Figueroa was placed alongside the vessel and one (1) hour
after the passengers of said vessel had disembarked, it started operation by
unloading the cargoes from said vessel. While the crane was being operated,
Anacleto Viana who had already disembarked from said vessel obviously
remembering that some of his cargoes were still loaded in the vessel, went
back to the vessel, and it was while he was pointing to the crew of the said
vessel to the place where his cargoes were loaded that the crane hit him,
pinning him between the side of the vessel and the crane. He was thereafter
brought to the hospital where he later expired three (3) days thereafter, on May
15, 1975, the cause of his death according to the Death Certificate (Exh. "C")
being "hypostatic pneumonia secondary to traumatic fracture of the pubic bone
lacerating the urinary bladder" (See also Exh. "B"). For his hospitalization,
medical, burial and other miscellaneous expenses, Anacleto's wife, herein
plaintiff, spent a total of P9,800.00 (Exhibits "E", "E-1", to "E-5"). Anacleto
Viana who was only forty (40) years old when he met said fateful accident
(Exh. 'E') was in good health. His average annual income as a farmer or a
farm supervisor was 400 cavans of palay annually. His parents, herein
plaintiffs Antonio and Gorgonia Viana, prior to his death had been recipient of
twenty (20) cavans of palay as support or P120.00 monthly. Because of
Anacleto's death, plaintiffs suffered mental anguish and extreme worry or
moral damages. For the filing of the instant case, they had to hire a lawyer for
an agreed fee of ten thousand (P10,000.00) pesos. 2
Private respondents Vianas filed a complaint 3 for damages against petitioner
corporation (Aboitiz, for brevity) for breach of contract of carriage.
In its answer. 4 Aboitiz denied responsibility contending that at the time of the
accident, the vessel was completely under the control of respondent Pioneer
Stevedoring Corporation (Pioneer, for short) as the exclusive stevedoring
contractor of Aboitiz, which handled the unloading of cargoes from the vessel
of Aboitiz. It is also averred that since the crane operator was not an employee
of Aboitiz, the latter cannot be held liable under the fellow-servant rule.
Thereafter, Aboitiz, as third-party plaintiff, filed a third-party complaint 5 against
Pioneer imputing liability thereto for Anacleto Viana's death as having been
allegedly caused by the negligence of the crane operator who was an
18

employee of Pioneer under its exclusive control and supervision.

Pioneer, in its answer to the third-party complaint, 6 raised the defenses that
Aboitiz had no cause of action against Pioneer considering that Aboitiz is being
sued by the Vianas for breach of contract of carriage to which Pioneer is not a
party; that Pioneer had observed the diligence of a good father of a family both
in the selection and supervision of its employees as well as in the prevention
of damage or injury to anyone including the victim Anacleto Viana; that
Anacleto Viana's gross negligence was the direct and proximate cause of his
death; and that the filing of the third-party complaint was premature by reason
of the pendency of the criminal case for homicide through reckless imprudence
filed against the crane operator, Alejo Figueroa.
In a decision rendered on April 17, 1980 by the trial court, 7 Aboitiz was
ordered to pay the Vianas for damages incurred, and Pioneer was ordered to
reimburse Aboitiz for whatever amount the latter paid the Vianas. The
dispositive portion of said decision provides:
WHEREFORE, judgment is hereby rendered in favor of the plantiffs:
(1)
ordering defendant Aboitiz Shipping Corporation to pay to plaintiffs
the sum of P12,000.00 for the death of Anacleto Viana P9,800.00 as actual
damages; P533,200.00 value of the 10,664 cavans of palay computed at
P50.00 per cavan; P10,000.00 as attorney's fees; F 5,000.00, value of the 100
cavans of palay as support for five (5) years for deceased (sic) parents, herein
plaintiffs Antonio and Gorgonia Viana computed at P50.00 per cavan;
P7,200.00 as support for deceased's parents computed at P120.00 a month
for five years pursuant to Art. 2206, Par. 2, of the Civil Code; P20,000.00 as
moral damages, and costs; and
(2)
ordering the third party defendant Pioneer Stevedoring Corporation
to reimburse defendant and third party plaintiff Aboitiz Shipping Corporation
the said amounts that it is ordered to pay to herein plaintiffs.
Both Aboitiz and Pioneer filed separate motions for reconsideration wherein
they similarly raised the trial court's failure to declare that Anacleto Viana acted
with gross negligence despite the overwhelming evidence presented in
support thereof. In addition, Aboitiz alleged, in opposition to Pioneer's motion,
that under the memorandum of agreement the liability of Pioneer as contractor
is automatic for any damages or losses whatsoever occasioned by and arising
from the operation of its arrastre and stevedoring service.
In an order dated October 27, 1982, 8 the trial court absolved Pioneer from
liability for failure of the Vianas and Aboitiz to preponderantly establish a case
of negligence against the crane operator which the court a quo ruled is never
presumed, aside from the fact that the memorandum of agreement supposedly
refers only to Pioneer's liability in case of loss or damage to goods handled by
it but not in the case of personal injuries, and, finally that Aboitiz cannot
properly invoke the fellow-servant rule simply because its liability stems from a
breach of contract of carriage. The dispositive portion of said order reads:
WHEREFORE, judgment is hereby modified insofar as third party defendant
Pioneer Stevedoring Corporation is concerned rendered in favor of the
plaintiffs-,:
(1)
Ordering defendant Aboitiz Shipping Corporation to pay the
plaintiffs the sum of P12,000.00 for the death of Anacleto Viana; P9,000.00
(sic) as actual damages; P533,200.00 value of the 10,664 cavans of palay
computed at P50.00 per cavan; P10,000.00 as attorney's fees; P5,000.00
value of the 100 cavans of palay as support for five (5) years for deceased's
parents, herein plaintiffs Antonio and Gorgonia Viana,computed at P50.00 per
cavan; P7,200.00 as support for deceased's parents computed at P120.00 a
month for five years pursuant to Art. 2206, Par. 2, of the Civil Code;
P20,000.00 as moral damages, and costs; and
(2)
Absolving third-party defendant Pioneer Stevedoring Corporation
for (sic) any liability for the death of Anacleto Viana the passenger of M/V
Antonia owned by defendant third party plaintiff Aboitiz Shipping Corporation it
appearing that the negligence of its crane operator has not been established
therein.
Not satisfied with the modified judgment of the trial court, Aboitiz appealed the
same to respondent Court of Appeals which affirmed the findings of of the trial
court except as to the amount of damages awarded to the Vianas.
Hence, this petition wherein petitioner Aboitiz postulates that respondent court
erred:
(A)
In holding that the doctrine laid down by this honorable Court in La
Mallorca vs. Court of Appeals, et al. (17 SCRA 739, July 27, 1966) is
applicable to the case in the face of the undisputable fact that the factual
situation under the La Mallorca case is radically different from the facts
obtaining in this case;
(B)
In holding petitioner liable for damages in the face of the finding of
the court a quo and confirmed by the Honorable respondent court of Appeals
that the deceased, Anacleto Viana was guilty of contributory negligence,
which, We respectfully submit contributory negligence was the proximate
cause of his death; specifically the honorable respondent Court of Appeals
failed to apply Art. 1762 of the New Civil Code;
(C)

In the alternative assuming the holding of the Honorable

respondent Court of Appears that petitioner may be legally condemned to pay

damages to the private respondents we respectfully submit that it committed a
reversible error when it dismissed petitioner's third party complaint against
private respondent Pioneer Stevedoring Corporation instead of compelling the
latter to reimburse the petitioner for whatever damages it may be compelled to
pay to the private respondents Vianas. 9
At threshold, it is to be observed that both the trial court and respondent Court
of Appeals found the victim Anacleto Viana guilty of contributory negligence,
but holding that it was the negligence of Aboitiz in prematurely turning over the
vessel to the arrastre operator for the unloading of cargoes which was the
direct, immediate and proximate cause of the victim's death.
I.
Petitioner contends that since one (1) hour had already elapsed
from the time Anacleto Viana disembarked from the vessel and that he was
given more than ample opportunity to unload his cargoes prior to the operation
of the crane, his presence on the vessel was no longer reasonable e and he
consequently ceased to be a passenger. Corollarily, it insists that the doctrine
in La Mallorca vs. Court of Appeals, et al. 10 is not applicable to the case at
bar.
The rule is that the relation of carrier and passenger continues until the
passenger has been landed at the port of destination and has left the vessel
owner's dock or premises. 11 Once created, the relationship will not ordinarily
terminate until the passenger has, after reaching his destination, safely
alighted from the carrier's conveyance or had a reasonable opportunity to
leave the carrier's premises. All persons who remain on the premises a
reasonable time after leaving the conveyance are to be deemed passengers,
and what is a reasonable time or a reasonable delay within this rule is to be
determined from all the circumstances, and includes a reasonable time to see
after his baggage and prepare for his departure. 12 The carrier-passenger
relationship is not terminated merely by the fact that the person transported
has been carried to his destination if, for example, such person remains in the
carrier's premises to claim his baggage. 13
It was in accordance with this rationale that the doctrine in the aforesaid case
of La Mallorca was enunciated, to wit:
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 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. Racquel, the child
that she was, must have followed the father. However, although the father was
still on the running board of the bus waiting 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
cautious 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. ... 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. 14
It is apparent from the foregoing that what prompted the Court to rule as it did
in said case is the fact of the passenger's reasonable presence within the
carrier's premises. That reasonableness of time should be made to depend on
the attending circumstances of the case, such as the kind of common carrier,
the nature of its business, the customs of the place, and so forth, and therefore
precludes a consideration of the time element per se without taking into
account such other factors. It is thus of no moment whether in the cited case of
La Mallorca there was no appreciable interregnum for the passenger therein to
leave the carrier's premises whereas in the case at bar, an interval of one (1)
hour had elapsed before the victim met the accident. The primary factor to be
considered is the existence of a reasonable cause as will justify the presence
of the victim on or near the petitioner's vessel. We believe there exists such a
justifiable cause.
It is of common knowledge that, by the very nature of petitioner's business as
a shipper, the passengers of vessels are allotted a longer period of time to
disembark from the ship than other common carriers such as a passenger bus.
With respect to the bulk of cargoes and the number of passengers it can load,
such vessels are capable of accommodating a bigger volume of both as
compared to the capacity of a regular commuter bus. Consequently, a ship
passenger will need at least an hour as is the usual practice, to disembark
from the vessel and claim his baggage whereas a bus passenger can easily
get off the bus and retrieve his luggage in a very short period of time. Verily,
petitioner cannot categorically claim, through the bare expedient of comparing
the period of time entailed in getting the passenger's cargoes, that the ruling in
19

La Mallorca is inapplicable to the case at bar. On the contrary, if we are to

apply the doctrine enunciated therein to the instant petition, we cannot in
reason doubt that the victim Anacleto Viana was still a passenger at the time of
the incident. When the accident occurred, the victim was in the act of
unloading his cargoes, which he had every right to do, from petitioner's vessel.
As earlier stated, a carrier is duty bound not only to bring its passengers safely
to their destination but also to afford them a reasonable time to claim their
baggage.
It is not definitely shown that one (1) hour prior to the incident, the victim had
already disembarked from the vessel. Petitioner failed to prove this. What is
clear to us is that at the time the victim was taking his cargoes, the vessel had
already docked an hour earlier. In consonance with common shipping
procedure as to the minimum time of one (1) hour allowed for the passengers
to disembark, it may be presumed that the victim had just gotten off the vessel
when he went to retrieve his baggage. Yet, even if he had already
disembarked an hour earlier, his presence in petitioner's premises was not
without cause. The victim had to claim his baggage which was possible only
one (1) hour after the vessel arrived since it was admittedly standard
procedure in the case of petitioner's vessels that the unloading operations
shall start only after that time. Consequently, under the foregoing
circumstances, the victim Anacleto Viana is still deemed a passenger of said
carrier at the time of his tragic death.

that Pioneer had taken the necessary safeguards insofar as its unloading
operations were concerned, a fact which appears to have been accepted by
the plaintiff therein by not impleading Pioneer as a defendant, and likewise
inceptively by Aboitiz by filing its third-party complaint only after ten (10)
months from the institution of the suit against it. Parenthetically, Pioneer is not
within the ambit of the rule on extraordinary diligence required of, and the
corresponding presumption of negligence foisted on, common carriers like
Aboitiz. This, of course, does not detract from what we have said that no
negligence can be imputed to Pioneer but, that on the contrary, the failure of
Aboitiz to exercise extraordinary diligence for the safety of its passenger is the
rationale for our finding on its liability.
WHEREFORE, the petition is DENIED and the judgment appealed from is
hereby AFFIRMED in toto.
SO ORDERED.
Melencio-Herrera (Chairperson), Paras, Padilla and Sarmiento, JJ., concur.

G.R. No. 122039

May 31, 2000

II.
Under the law, common carriers are, from the nature of their
business and for reasons of public policy, bound to observe extraordinary
diligence in the vigilance over the goods and for the safety of the passengers
transported by them, according to all the circumstances of each case. 15 More
particularly, 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. 16 Thus, where
a passenger dies or is injured, the common carrier is presumed to have been
at fault or to have acted negligently. 17 This gives rise to an action for breach
of contract of carriage where all that is required of plaintiff is to prove the
existence of the contract of carriage and its non-performance by the carrier,
that is, the failure of the carrier to carry the passenger safely to his destination,
18 which, in the instant case, necessarily includes its failure to safeguard its
passenger with extraordinary diligence while such relation subsists.

VICENTE CALALAS, petitioner,

vs.
COURT OF APPEALS, ELIZA JUJEURCHE
FRANCISCO SALVA, respondents.

The presumption is, therefore, established by law that in case of a passenger's

death or injury the operator of the vessel was at fault or negligent, having
failed to exercise extraordinary diligence, and it is incumbent upon it to rebut
the same. This is in consonance with the avowed policy of the State to afford
full protection to the passengers of common carriers which can be carried out
only by imposing a stringent statutory obligation upon the latter. Concomitantly,
this Court has likewise adopted a rigid posture in the application of the law by
exacting the highest degree of care and diligence from common carriers,
bearing utmost in mind the welfare of the passengers who often become
hapless victims of indifferent and profit-oriented carriers. We cannot in reason
deny that petitioner failed to rebut the presumption against it. Under the facts
obtaining in the present case, it cannot be gainsaid that petitioner had
inadequately complied with the required degree of diligence to prevent the
accident from happening.

The facts, as found by the Court of Appeals, are as follows:

As found by the Court of Appeals, the evidence does not show that there was
a cordon of drums around the perimeter of the crane, as claimed by petitioner.
It also adverted to the fact that the alleged presence of visible warning signs in
the vicinity was disputable and not indubitably established. Thus, we are not
inclined to accept petitioner's explanation that the victim and other passengers
were sufficiently warned that merely venturing into the area in question was
fraught with serious peril. Definitely, even assuming the existence of the
supposed cordon of drums loosely placed around the unloading area and the
guard's admonitions against entry therein, these were at most insufficient
precautions which pale into insignificance if considered vis-a-vis the gravity of
the danger to which the deceased was exposed. There is no showing that
petitioner was extraordinarily diligent in requiring or seeing to it that said
precautionary measures were strictly and actually enforced to subserve their
purpose of preventing entry into the forbidden area. By no stretch of liberal
evaluation can such perfunctory acts approximate the "utmost diligence of very
cautious persons" to be exercised "as far as human care and foresight can
provide" which is required by law of common carriers with respect to their
passengers.
While the victim was admittedly contributorily negligent, still petitioner's
aforesaid failure to exercise extraordinary diligence was the proximate and
direct cause of, because it could definitely have prevented, the former's death.
Moreover, in paragraph 5.6 of its petition, at bar, 19 petitioner has expressly
conceded the factual finding of respondent Court of Appeals that petitioner did
not present sufficient evidence in support of its submission that the deceased
Anacleto Viana was guilty of gross negligence. Petitioner cannot now be heard
to claim otherwise.
No excepting circumstance being present, we are likewise bound by
respondent court's declaration that there was no negligence on the part of
Pioneer Stevedoring Corporation, a confirmation of the trial court's finding to
that effect, hence our conformity to Pioneer's being absolved of any liability.
As correctly observed by both courts, Aboitiz joined Pioneer in proving the
alleged gross negligence of the victim, hence its present contention that the
death of the passenger was due to the negligence of the crane operator
cannot be sustained both on grounds, of estoppel and for lack of evidence on
its present theory. Even in its answer filed in the court below it readily alleged

SUNGA

and

MENDOZA, J.:
This is a petition for review on certiorari of the decision1 of the Court of
Appeals, dated March 31, 1991, reversing the contrary decision of the
Regional Trial Court, Branch 36, Dumaguete City, and awarding damages
instead to private respondent Eliza Jujeurche Sunga as plaintiff in an action for
breach of contract of carriage.

At 10 o'clock in the morning of August 23, 1989, private respondent Eliza

Jujeurche G. Sunga, then a college freshman majoring in Physical Education
at the Siliman University, took a passenger jeepney owned and operated by
petitioner Vicente Calalas. As the jeepney was filled to capacity of about 24
passengers, Sunga was given by the conductor an "extension seat," a wooden
stool at the back of the door at the rear end of the vehicle.
On the way to Poblacion Sibulan, Negros Occidental, the jeepney stopped to
let a passenger off. As she was seated at the rear of the vehicle, Sunga gave
way to the outgoing passenger. Just as she was doing so, an Isuzu truck
driven by Iglecerio Verena and owned by Francisco Salva bumped the left rear
portion of the jeepney. As a result, Sunga was injured. She sustained a
fracture of the "distal third of the left tibia-fibula with severe necrosis of the
underlying skin." Closed reduction of the fracture, long leg circular casting, and
case wedging were done under sedation. Her confinement in the hospital
lasted from August 23 to September 7, 1989. Her attending physician, Dr.
Danilo V. Oligario, an orthopedic surgeon, certified she would remain on a cast
for a period of three months and would have to ambulate in crutches during
said period.
On October 9, 1989, Sunga filed a complaint for damages against Calalas,
alleging violation of the contract of carriage by the former in failing to exercise
the diligence required of him as a common carrier. Calalas, on the other hand,
filed a third-party complaint against Francisco Salva, the owner of the Isuzu
truck.
The lower court rendered judgment against Salva as third-party defendant and
absolved Calalas of liability, holding that it was the driver of the Isuzu truck
who was responsible for the accident. It took cognizance of another case (Civil
Case No. 3490), filed by Calalas against Salva and Verena, for quasi-delict, in
which Branch 37 of the same court held Salva and his driver Verena jointly
liable to Calalas for the damage to his jeepney.
On appeal to the Court of Appeals, the ruling of the lower court was reversed
on the ground that Sunga's cause of action was based on a contract of
carriage, not quasi-delict, and that the common carrier failed to exercise the
diligence required under the Civil Code. The appellate court dismissed the
third-party complaint against Salva and adjudged Calalas liable for damages to
Sunga. The dispositive portion of its decision reads:
WHEREFORE, the decision appealed from is hereby REVERSED and SET
ASIDE, and another one is entered ordering defendant-appellee Vicente
Calalas to pay plaintiff-appellant:
(1)

P50,000.00 as actual and compensatory damages;

(2)

P50,000.00 as moral damages;

(3)

P10,000.00 as attorney's fees; and

(4)

P1,000.00 as expenses of litigation; and

20

(5)

to pay the costs.

SO ORDERED.
Hence, this petition. Petitioner contends that the ruling in Civil Case No. 3490
that the negligence of Verena was the proximate cause of the accident
negates his liability and that to rule otherwise would be to make the common
carrier an insurer of the safety of its passengers. He contends that the
bumping of the jeepney by the truck owned by Salva was a caso fortuito.
Petitioner further assails the award of moral damages to Sunga on the ground
that it is not supported by evidence.
The petition has no merit.
The argument that Sunga is bound by the ruling in Civil Case No. 3490 finding
the driver and the owner of the truck liable for quasi-delict ignores the fact that
she was never a party to that case and, therefore, the principle of res judicata
does not apply.
Nor are the issues in Civil Case No. 3490 and in the present case the same.
The issue in Civil Case No. 3490 was whether Salva and his driver Verena
were liable for quasi-delict for the damage caused to petitioner's jeepney. On
the other hand, the issue in this case is whether petitioner is liable on his
contract of carriage. The first, quasi-delict, also known as culpa aquiliana or
culpa extra contractual, has as its source the negligence of the tortfeasor. The
second, breach of contract or culpa contractual, is premised upon the
negligence in the performance of a contractual obligation.
Consequently, in quasi-delict, the negligence or fault should be clearly
established because it is the basis of the action, whereas in breach of contract,
the action can be prosecuted merely by proving the existence of the contract
and the fact that the obligor, in this case the common carrier, failed to transport
his passenger safely to his destination.2 In case of death or injuries to
passengers, Art. 1756 of the Civil Code provides that common carriers are
presumed to have been at fault or to have acted negligently unless they prove
that they observed extraordinary diligence as defined in Arts. 1733 and 1755 of
the Code. This provision necessarily shifts to the common carrier the burden of
proof.
There is, thus, no basis for the contention that the ruling in Civil Case No.
3490, finding Salva and his driver Verena liable for the damage to petitioner's
jeepney, should be binding on Sunga. It is immaterial that the proximate cause
of the collision between the jeepney and the truck was the negligence of the
truck driver. The doctrine of proximate cause is applicable only in actions for
quasi-delict, not in actions involving breach of contract. The doctrine is a
device for imputing liability to a person where there is no relation between him
and another party. In such a case, the obligation is created by law itself. But,
where there is a pre-existing contractual relation between the parties, it is the
parties themselves who create the obligation, and the function of the law is
merely to regulate the relation thus created. Insofar as contracts of carriage
are concerned, some aspects regulated by the Civil Code are those respecting
the diligence required of common carriers with regard to the safety of
passengers as well as the presumption of negligence in cases of death or
injury to passengers. It provides:
Art. 1733. Common carriers, from the nature of their business and for
reasons of public policy, are bound to observe extraordinary diligence in the
vigilance over the goods and for the safety of the passengers transported by
them, according to all the circumstances of each case.
Such extraordinary diligence in the vigilance over the goods is further
expressed in articles 1734, 1735, and 1746, Nos. 5, 6, and 7, while the
extraordinary diligence for the safety of the passengers is further set forth in
articles 1755 and 1756.
Art. 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 due regard for all the circumstances.
Art. 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 by articles 1733 and
1755.
In the case at bar, upon the happening of the accident, the presumption of
negligence at once arose, and it became the duty of petitioner to prove that he
had to observe extraordinary diligence in the care of his passengers.

the free passage of other vehicles on the highway.

Second, it is undisputed that petitioner's driver took in more passengers than
the allowed seating capacity of the jeepney, a violation of 32(a) of the same
law. It provides:
Exceeding registered capacity. No person operating any motor vehicle shall
allow more passengers or more freight or cargo in his vehicle than its
registered capacity.
The fact that Sunga was seated in an "extension seat" placed her in a peril
greater than that to which the other passengers were exposed. Therefore, not
only was petitioner unable to overcome the presumption of negligence
imposed on him for the injury sustained by Sunga, but also, the evidence
shows he was actually negligent in transporting passengers.
We find it hard to give serious thought to petitioner's contention that Sunga's
taking an "extension seat" amounted to an implied assumption of risk. It is akin
to arguing that the injuries to the many victims of the tragedies in our seas
should not be compensated merely because those passengers assumed a
greater risk of drowning by boarding an overloaded ferry. This is also true of
petitioner's contention that the jeepney being bumped while it was improperly
parked constitutes caso fortuito. A caso fortuito is an event which could not be
foreseen, or which, though foreseen, was inevitable.3 This requires that the
following requirements be present: (a) the cause of the breach is independent
of the debtor's will; (b) the event is unforeseeable or unavoidable; (c) the event
is such as to render it impossible for the debtor to fulfill his obligation in a
normal manner, and (d) the debtor did not take part in causing the injury to the
creditor.4 Petitioner should have foreseen the danger of parking his jeepney
with its body protruding two meters into the highway.
Finally, petitioner challenges the award of moral damages alleging that it is
excessive and without basis in law. We find this contention well taken.
In awarding moral damages, the Court of Appeals stated:
Plaintiff-appellant at the time of the accident was a first-year college student in
that school year 1989-1990 at the Silliman University, majoring in Physical
Education. Because of the injury, she was not able to enroll in the second
semester of that school year. She testified that she had no more intention of
continuing with her schooling, because she could not walk and decided not to
pursue her degree, major in Physical Education "because of my leg which has
a defect already."
Plaintiff-appellant likewise testified that even while she was under
confinement, she cried in pain because of her injured left foot. As a result of
her injury, the Orthopedic Surgeon also certified that she has "residual bowing
of the fracture side." She likewise decided not to further pursue Physical
Education as her major subject, because "my left leg . . . has a defect already."
Those are her physical pains and moral sufferings, the inevitable bedfellows of
the injuries that she suffered. Under Article 2219 of the Civil Code, she is
entitled to recover moral damages in the sum of P50,000.00, which is fair, just
and reasonable.
As a general rule, moral damages are not recoverable in actions for damages
predicated on a breach of contract for it is not one of the items enumerated
under Art. 2219 of the Civil Code.5 As an exception, such damages are
recoverable: (1) in cases in which the mishap results in the death of a
passenger, as provided in Art. 1764, in relation to Art. 2206(3) of the Civil
Code; and (2) in the cases in which the carrier is guilty of fraud or bad faith, as
provided in Art. 2220.6
In this case, there is no legal basis for awarding moral damages since there
was no factual finding by the appellate court that petitioner acted in bad faith in
the performance of the contract of carriage. Sunga's contention that
petitioner's admission in open court that the driver of the jeepney failed to
assist her in going to a nearby hospital cannot be construed as an admission
of bad faith. The fact that it was the driver of the Isuzu truck who took her to
the hospital does not imply that petitioner was utterly indifferent to the plight of
his injured passenger. If at all, it is merely implied recognition by Verena that
he was the one at fault for the accident.
WHEREFORE, the decision of the Court of Appeals, dated March 31, 1995,
and its resolution, dated September 11, 1995, are AFFIRMED, with the
MODIFICATION that the award of moral damages is DELETED.
SO ORDERED.

Now, did the driver of jeepney carry Sunga "safely as far as human care and
foresight could provide, using the utmost diligence of very cautious persons,
with due regard for all the circumstances" as required by Art. 1755? We do not
think so. Several factors militate against petitioner's contention.
G.R. No. L-8034
First, as found by the Court of Appeals, the jeepney was not properly parked,
its rear portion being exposed about two meters from the broad shoulders of
the highway, and facing the middle of the highway in a diagonal angle. This is
a violation of the R.A. No. 4136, as amended, or the Land Transportation and
Traffic Code, which provides:
Sec. 54. Obstruction of Traffic. No person shall drive his motor vehicle in
such a manner as to obstruct or impede the passage of any vehicle, nor, while
discharging or taking on passengers or loading or unloading freight, obstruct

November 18, 1955

CORNELIA A. DE GILLACO, ET AL., plaintiffs-appellees,

vs.
MANILA RAILROAD COMPANY, defendant-appellant.
First Assistant Corporate Counsel Federico C. Alikpala and Attorney
Higino R. Francisco for appellant.
Restituto Luna for appellees.
21

REYES, J.B.L., J.:

human care and foresight can provide.

The Manila Railroad Company has appealed from a judgment of the Court of
First Instance of Laguna sentencing it to pay P4,000 damages to the appellees
herein, the widow and children of the late Tomas Gillaco, shot by an employee
of the Company in April, 1946.

The lower Court and the appellees both relied on the American authorities that
particularly hold carriers to be insurers of the safety of their passengers
against willful assault and intentional ill treatment on the part of their servants,
it being immaterial that the act should be one of private retribution on the part
of the servant, impelled by personal malice toward the passenger (10 Am. Jur.
108; Ed. Note to Gassenheimer vs. Wester R. Co. 40 LRA (NS), p. 999, et
seq.) But as can be inferred from the previous jurisprudence of this Court , the
Civil Code of 1889 did not impose such absolute liability (Lasam vs. Smith,
supra). The liability of a carrier as an insurer was not recognized in this
jurisdiction (Government vs. Inchausti & Co., 40 Phil., 219; Oriental Comm.
Co. vs. Naviera Filipina, 38 Off. Gaz., 1020).

The judgment was rendered upon the following stipulation of facts:

That at about 7:30 a.m., on the morning of April 1, 1946, Lieut. Tomas Gillaco,
husband of the plaintiff, was a passenger in the early morning train of the
Manila Railroad Company from Calamba, Laguna to Manila;
That when the train reached the Paco Railroad station, Emilio Devesa, a train
guard of the Manila Railroad Company assigned in the Manila-San Fernando,
La Union Line, happened to be in said station waiting for the same train which
would take him to Tutuban Station, where he was going to report for duty;
That Emilio Devesa had a long standing personal grudge against Tomas
Gillaco, same dating back during the Japanese occupation;
That because of this personal grudge, Devesa shot Gillaco with the carbine
furnished to him by the Manila Railroad Company for his use as such train
guard, upon seeing him inside the train coach;
That Tomas Gillaco died as a result of the would which he sustained from the
shot fired by Devesa.
It is also undisputed that Devesa was convicted with homicide by final
judgment of the Court of Appeals.
Appellant's contention is that, on the foregoing facts, no liability attaches to it
as employer of the killer, Emilio Devesa; that it is not responsible subsidiary ex
delicto, under Art. 103 of the Revised Penal Code, because the crime was not
committed while the slayer was in the actual performance of his ordinary
duties and service; nor is it responsible ex contractu, since the complaint did
not aver sufficient facts to establish such liability, and no negligence on
appellant's party was shown. The Court below held the Railroad company
responsible on the ground that a contract of transportation implies protection of
the passengers against acts of personal violence by the agents or employees
of the carrier.
There can be no quarrel with the principle that a passenger is entitled to
protection from personal violence by the carrier or its agents or employees,
since the contract of transportation obligates the carrier to transport a
passenger safely to his destination. But under the law of the case, this
responsibility extends only to those that the carrier could foresee or avoid
through the exercise of the degree of car and diligence required of it.
Discussing the basis of a carrier's liability under the old Civil Code of 1889
(which was in force in 1946, when Gillaco was shot) this Court said in Lasam
vs. Smith (45 Phil., 657):
In our opinion, the conclusions of the court below are entirely correct. That
upon the facts stated the defendant's liability, if any, is contractual, is well
settled by previous decisions of the court, beginning with the case of Rakes vs.
Atlantic, Gulf & Pacific Co. (7 Phil., 359), and the distinction between extracontractual liability and contractual liability has been so ably and exhaustively
discussed in various other cases that nothing further need here be said upon
that subject. (See Cangco vs. Manila Railroad Co., 38 Phil., 768; Manila
Railroad vs. Compaia Transatlantica and Atlantic, Gulf & Pacific Co., 38 Phil.,
875; De Guia vs. Manila Electric Railroad & Light Co., 40 Phil., 706). It is
sufficient to reiterate that the source of the defendant's legal liability is the
contract of carriage; that by entering into that contract he bound himself to
carry the plaintiff safely and securely to their destination; and that having failed
to do so he is liable in damages unless he shows that the failure to fulfill his
obligation was due to causes mentioned in article 1105 of the Civil Code,
which reads as follows:
"No one shall be liable for events which could not be foreseen or which, even if
foreseen, were inevitable, with the exception of the cases in which the law
expressly provides otherwise and those in which the obligation itself imposes
such liability."
The act of guard Devesa in shooting passenger Gillaco (because of a personal
grudge nurtured against the latter since the Japanese occupation) was entirely
unforeseeable by the Manila Railroad Co. The latter had no means to
ascertain or anticipate that the two would meet, nor could it reasonably foresee
every personal rancor that might exist between each one of its many
employees and any one of the thousands of eventual passengers riding in its
trains. The shooting in question was therefore "caso fortuito" within the
definition of article 105 of the old Civil Code, being both unforeseeable and
inevitable under the given circumstances; and pursuant to established
doctrine, the resulting breach of appellant's contract of safe carriage with the
late Tomas Gillaco was excused thereby.
No doubt that a common carrier is held to a very high degree of care and
diligence in the protection of its passengers; but, considering the vast and
complex activities of modern rail transportation, to require of appellant that it
should guard against all possible misunderstanding between each and every
one of its employees and every passenger that might chance to ride in its
conveyances at any time, strikes us as demanding diligence beyond what

Another very important consideration that must be borne in mind is that, when
the crime took place, the guard Devesa had no 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 that 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 passenger of the CalambaManila 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
cannot be deemed in law a breach of Gillaco's contract of transportation by a
servant or employee of the carrier. We agree with the position taken by the
Supreme Court of Texas in a similar case, where it held:
The only good reason for making the carrier responsible for the misconduct of
the servant perpetrated in his own interest, and not in that of his employer, or
otherwise within the scope of his employment, is that the servant is clothed
with the delegated authority, and charge with the duty by the carrier, to execute
his undertaking with the passenger. And it cannot be said, we think, that there
is any such delegation to the employees at a station with reference to
passenger embarking at another or traveling on the train. Of course, we are
speaking only of the principle which holds a carrier responsible for wrong done
to passenger by servants acting in their own interest, and not in that of the
employer. That principle is not the ordinary rule, respondent superior, by which
the employer is held responsible only for act or omissions of the employee in
the scope of his employment; but the only reason in our opinion for a broader
liability arises from the fact that the servant, in mistreating the passenger
wholly for some private purpose of his own, in the very act, violates the
contractual obligation of the employer for the performance of which he has put
the employee in his place. The reason does not exist where the employee who
committed the assault was never in a position in which it became his duty to
his employer to represent him in discharging any duty of the latter toward the
passenger. The proposition that the carrier clothes every employee engaged in
the transportation business with the comprehensive duty of protecting every
passenger with whom he may in any way come in contact, and hereby makes
himself liable for every assault commited by such servant, without regard to
the inquiry whether or not the passenger has come within the sphere of duty of
that servant as indicated by the employment, is regarded as not only not
sustained by the authorities, but as being unsound and oppressive both to the
employer and the employee. (Houston & T. C. R. Co. vs. Bush, 32 LRA (NS),
p. 1205.)
Wherefore, the judgment appealed from is reversed and the complaint ordered
dismissed, without cost. So ordered.
G.R. No. L-22272

June 26, 1967

ANTONIA MARANAN, plaintiff-appellant,

vs.
PASCUAL PEREZ, ET AL., defendants.
PASCUAL PEREZ, defendant appellant.
Pedro Panganiban for plaintiff-appellant.
Magno T. Bueser for defendant-appellant.
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.1wph1.t
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 selfdefense, 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.
22

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:
x x x when the crime took place, the guard Devesa had no 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 that he was engaged to guard. In fact, his tour of duty was to
start at 9:00 two hours after the commission of the crime. Devesa was
therefore under no obligation to safeguard the passengers of the CalambaManila 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 through
the negligence or willful 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 Carriers1 are new and
were taken from Anglo-American Law.2 There, the basis of the carrier's liability
for assaults on passengers committed by its drivers rests either on (1) the
doctrine of respondeat superior or (2) the principle that it is the carrier's implied
duty to transport the passenger safely.3
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.4
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.5 The carrier's liability here is absolute in
the sense that it practically secures the passengers from assaults committed
by its own employees.6
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
formers 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 carriage7 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,8 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.9 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. 10
Wherefore, with the modification increasing the award of actual damages in
plaintiff's favor to P6,000, plus P3,000.00 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.
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez and
Castro, JJ., concur.
G.R. No. L-55347

October 4, 1985

PHILIPPINE NATIONAL RAILWAYS, petitioner,

vs.
THE HONORABLE COURT OF APPEALS
TUPANG, respondents.

and ROSARIO

Arturo Samaniego for private respondent.

ESCOLIN, J.:
Invoking the principle of state immunity from suit, the Philippine National
Railways, PNR for short, instituted this petition for review on certiorari to set
aside the decision of the respondent Appellate Court which held petitioner
PNR liable for damages for the death of Winifredo Tupang, a paying
passenger who fell off a train operated by the petitioner.
The pertinent facts are summarized by the respondent court as follows:
The facts show that on September 10, 1972, at about 9:00 o'clock in the
evening, Winifredo Tupang, husband of plaintiff Rosario Tupang, boarded
'Train No. 516 of appellant at Libmanan, Camarines Sur, as a paying
passenger bound for Manila. Due to some mechanical defect, the train
stopped at Sipocot, Camarines Sur, for repairs, taking some two hours before
the train could resume its trip to Manila. Unfortunately, upon passing Iyam
Bridge at Lucena, Quezon, Winifredo Tupang fell off the train resulting in his
death.The train did not stop despite the alarm raised by the other passengers
that somebody fell from the train. Instead, the train conductor Perfecto
Abrazado, called the station agent at Candelaria, Quezon, and requested for
verification of the information. Police authorities of Lucena City were
dispatched to the Iyam Bridge where they found the lifeless body of Winifredo
Tupang.
As shown by the autopsy report, Winifredo Tupang died of cardio-respiratory
failure due to massive cerebral hemorrhage due to traumatic injury [Exhibits B
and C, Folder of Exhibits],Tupang was later buried in the public cemetery of
Lucena City by the local police authorities. [Rollo, pp. 91-92]
Upon complaint filed by the deceased's widow, Rosario Tupang, the then
Court of First Instance of Rizal, after trial, held the petitioner PNR liable for
damages for breach of contract of carriage and ordered "to pay the plaintiff the
sum of P12,000,00 for the death of Winifredo Tupang, plus P20,000.00 for loss
of his earning capacity and the further sum of P10,000.00 as moral damages,
and P2,000.00 as attorney's fees, and costs. 1
On appeal, the Appellate Court sustained the holding of the trial court that the
PNR did not exercise the utmost diligence required by law of a common
carrier. It further increased the amount adjudicated by the trial court by
ordering PNR to pay the plaintiff an additional sum of P5,000.00 as exemplary
damages.
Moving for reconsideration of the above decision, the PNR raised for the first
23

time, as a defense, the doctrine of state immunity from suit. It alleged that it is
a mere agency of the Philippine government without distinct or separate
personality of its own, and that its funds are governmental in character and,
therefore, not subject to garnishment or execution. The motion was denied; the
respondent court ruled that the ground advanced could not be raised for the
first time on appeal.
Hence, this petition for review.
The petition is devoid of merit. The PNR was created under Rep. Act 4156, as
amended. Section 4 of the said Act provides:

aside. Exemplary damages may be allowed only in cases where the defendant
acted in a wanton, fraudulent, reckless, oppressive or malevolent manner. 9
There being no evidence of fraud, malice or bad faith on the part of petitioner,
the grant of exemplary damages should be discarded.
WHEREFORE, the decision of the respondent appellate court is hereby
modified by eliminating therefrom the amounts of P10,000.00 and P5,000.00
adjudicated as moral and exemplary damages, respectively. No costs.
SO ORDERED.
Concepcion, Jr., Cuevas, and Alampay, JJ., concur.

The Philippine national Railways shall have the following powers:

a.
To do all such other things and to transact all such business
directly or indirectly necessary, incidental or conducive to the attainment of the
purpose of the corporation; and
Separate Opinions
b.
Generally, to exercise all powers of a corporation under the
Corporation Law.
Under the foregoing section, the PNR has all the powers, the characteristics
and attributes of a corporation under the Corporation Law. There can be no
question then that the PNR may sue and be sued and may be subjected to
court processes just like any other corporation. 2
The petitioner's contention that the funds of the PNR are not subject to
garnishment or execution hardly raises a question of first impression. In
Philippine National Railways v. Union de Maquinistas, et al., 3 then Justice
Fernando, later Chief Justice, said. "The main issue posed in this certiorari
proceeding, whether or not the funds of the Philippine National Railways, could
be garnished or levied upon on execution was resolved in two recent
decisions, the Philippine National Bank v. Court of Industrial Relations [81
SCRA 314] and Philippine National Bank v. Hon. Judge Pabalan [83 SCRA
595]. This Court in both cases answered the question in the affirmative. There
was no legal bar to garnishment or execution. The argument based on nonsuability of a state allegedly because the funds are governmental in character
was unavailing.So it must be again."
In support of the above conclusion, Justice Fernando cited the Court's holding
in Philippine National Bank v. Court of Industrial Relations, to wit: "The premise
that the funds could be spoken of as public in character may be accepted in
the sense that the People's Homesite and Housing Corporation was a
government-owned entity. It does not follow though that they were exempt
from garnishment. National Shipyard and Steel Corporation v. Court of
Industrial Relations is squarely in point. As was explicitly stated in the opinion
of then Justice, later Chief Justice, Concepcion: "The allegation to the effect
that the funds of the NASSCO are public funds of the government, and that, as
such, the same may not be garnished, attached or levied upon, is untenable
for, as a government- owned and controlled corporation, the NASSCO has a
personality of its own, distinct and separate from that of the Government. It
has-pursuant to Section 2 of Executive Order No. 356, dated October 23, 1950
* * *, pursuant to which the NASSCO has been established- 'all the powers of
a corporation under the Corporation Law * * *. 4
As far back as 1941, this Court in the case of Manila Hotel Employees
Association v. Manila Hotel Co., 5 laid down the rule that "when the
government enters into commercial business, it abandons its sovereign
capacity and is to be treated like any other corporation. [Bank of the U.S. v.
Planters' Bank, 9 Waitch 904, 6 L. ed. 244]. By engaging in a particular
business through the instrumentality of a corporation the government divests
itself pro hac vice of its sovereign character, so as to render the corporation
subject to the rules of law governing private corporations. 6 Of Similar import is
the pronouncement in Prisco v. CIR,' that "when the government engages in
business, it abdicates part of its sovereign prerogatives and descends to the
level of a citizen, ... . " In fine, the petitioner PNR cannot legally set up the
doctrine of non-suability as a bar to the plaintiff's suit for damages.
The appellate court found, the petitioner does not deny, that the train boarded
by the deceased Winifredo Tupang was so over-crowded that he and many
other passengers had no choice but to sit on the open platforms between the
coaches of the train. It is likewise undisputed that the train did not even slow
down when it approached the Iyam Bridge which was under repair at the time,
Neither did the train stop, despite the alarm raised by other passengers that a
person had fallen off the train at lyam Bridge. 7
The petitioner has the obligation to transport its passengers to their
destinations and to observe extraordinary diligence in doing so. Death or any
injury suffered by any of its passengers gives rise to the presumption that it
was negligent in the performance of its obligation under the contract of
carriage. Thus, as correctly ruled by the respondent court, the petitioner failed
to overthrow such presumption of negligence with clear and convincing
evidence.
But while petitioner failed to exercise extraordinary diligence as required by
law, 8 it appears that the deceased was chargeable with contributory
negligence. Since he opted to sit on the open platform between the coaches of
the train, he should have held tightly and tenaciously on the upright metal bar
found at the side of said platform to avoid falling off from the speeding train.
Such contributory negligence, while not exempting the PNR from liability,
nevertheless justified the deletion of the amount adjudicated as moral
damages. By the same token, the award of exemplary damages must be set

AQUINO, J., concurring:

The case of Malong vs. PNR, L-49930, Aug. 7, 1985 (en banc) hold that the
PNR is not immune from suit and is liable as a common carrier for the
negligent acts of its employeees. It is expressly liable for moral damages for
the death of a passanger under arts. 1764 and 2206 of the Civil Code.
ABAD SANTOS, J., concurring:
I concur with the admonition that government owned and/or controlled
corporations should desist from invoking the baseless immunity from suit.
Separate Opinions
AQUINO, J., concurring:
The case of Malong vs. PNR, L-49930, Aug. 7, 1985 (en banc) hold that the
PNR is not immune from suit and is liable as a common carrier for the
negligent acts of its employeees. It is expressly liable for moral damages for
the death of a passanger under arts. 1764 and 2206 of the Civil Code.
ABAD SANTOS, J., concurring:
I concur with the admonition that government owned and/or controlled
corporations should desist from invoking the baseless immunity from suit.

G.R. No. L-29462

March 7, 1929

IGNACIO DEL PRADO, plaintiff-appellee,

vs.
MANILA ELECTRIC CO., defendant-appellant.
Ross, Lawrence and Selph and Antonio T. Carrascoso, jr., for appellant.
Vicente Sotto for appellee.
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 personal injuries
alleged to have been caused by the negligence of te 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 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 exist 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 shows 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 hand, the front perpendicular handspot, 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
flatform, 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
24

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 that the
plaintiff's fall was due in part at lease 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 witness 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 engage in this business were required to stop any and everywhere to
take on people who were 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 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 in failure on the part of the carrier to use due care in
carrying its passengers safely is a breach of duty (culpa contructual) 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 vs. 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 the 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 badly
injured. This court held that the railroad company was liable for breach 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
contructual duty and that arising articles 1902 and 1903 of the Civil Code
(culpa aquiliana).
The distiction 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 providing that he had exercised due degligence to prevent the
damage; whereas this defense is not available if the liability of the master
arises from a breach of contrauctual duty (culpa contractual). In the case bfore
us the company pleaded as a special defense that it had used all the
deligence 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. vs. Compana
Transatlantica and Atlantic, Gulf & Pacific Co., 38 Phil., 875, 887; De Guia vs.
Manila Electric Railroad & Light Co., 40 Phil., 706, 710.)
Another practical difference between liability for negligence arising under 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; although 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 vs. 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
vs. 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
limb, and more particularly Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil.,
359); Cangco vs. Manila Railroad Co. (38 Phil., 768); and Borromeo vs. 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.
Malcolm, Villamor, Ostrand, Romualdez and Villa-Real, JJ., concur.

G.R. No. L-9671

August 23, 1957

CESAR L. ISAAC, plaintiff-appellant,

vs.
A. L. AMMEN TRANSPORTATION CO., INC., defendant-appellee.
Angel S. Gamboa for appellant.
Manuel O. Chan for appellee.
BAUTISTA ANGELO, J.:
A. L. Ammen Transportation Co., Inc., hereinafter referred to as defendant, is a
corporation engaged in the business of transporting passengers by land for
compensation in the Bicol provinces and one of the lines it operates is the one
connecting Legaspi City, Albay with Naga City, Camarines Sur. One of the
buses which defendant was operating is Bus No. 31. On May 31, 1951,
plaintiff boarded said bus as a passenger paying the required fare from Ligao,
Albay bound for Pili, Camarines Sur, but before reaching his destination, the
bus collided with a motor vehicle of the pick-up type coming from the opposite
direction, as a result of which plaintiff's left arm was completely severed and
the severed portion fell inside the bus. Plaintiff was rushed to a hospital in
Iriga, Camarines Sur where he was given blood transfusion to save his life.
After four days, he was transferred to another hospital in Tabaco, Albay, where
he under went treatment for three months. He was moved later to the
Orthopedic Hospital where he was operated on and stayed there for another
two months. For these services, he incurred expenses amounting to P623.40,
excluding medical fees which were paid by defendant.
As an aftermath, plaintiff brought this action against defendants for damages
alleging that the collision which resulted in the loss of his left arm was mainly
due to the gross incompetence and recklessness of the driver of the bus
operated by defendant and that defendant incurred in culpa contractual arising
from its non-compliance with its obligation to transport plaintiff safely to his,
destination. Plaintiff prays for judgment against defendant as follows: (1)
P5,000 as expenses for his medical treatment, and P3,000 as the cost of an
artificial arm, or a total of P8,000; (2) P6,000 representing loss of earning; (3)
P75,000 for diminution of his earning capacity; (4) P50,000 as moral damages;
and (5) P10,000 as attorneys' fees and costs of suit.
Defendant set up as special defense that the injury suffered by plaintiff was
due entirely to the fault or negligence of the driver of the pick-up car which
collided with the bus driven by its driver and to the contributory negligence of
plaintiff himself. Defendant further claims that the accident which resulted in
the injury of plaintiff is one which defendant could not foresee or, though
foreseen, was inevitable.
The after trial found that the collision occurred due to the negligence of the
driver of the pick-up car and not to that of the driver of the bus it appearing that
the latter did everything he could to avoid the same but that notwithstanding
his efforts, he was not able to avoid it. As a consequence, the court dismissed
complaint, with costs against plaintiff. This is an appeal from said decision.
It appears that plaintiff boarded a bus of defendant as paying passenger from
Ligao, Albay, bound for Pili, Camarines Sur, but before reaching his
destination, the bus collided with a pick-up car which was coming from the
opposite direction and, as a, result, his left arm was completely severed and
fell inside the back part of the bus. Having this background in view, and
considering that plaintiff chose to hold defendant liable on its contractual
obligation to carry him safely to his place of destination, it becomes important
to determine the nature and extent of the liability of a common carrier to a
passenger in the light of the law applicable in this jurisdiction.
In this connection, appellant invokes the rule that, "when an action is based on
25

a contract of carriage, as in this case, all that is necessary to sustain recovery

is proof of the existence of the contract of the breach thereof by act or
omission", and in support thereof, he cites several Philippine cases.1 With the
ruling in mind, appellant seems to imply that once the contract of carriage is
established and there is proof that the same was broken by failure of the
carrier to transport the passenger safely to his destination, the liability of the
former attaches. On the other hand, appellee claims that is a wrong
presentation of the rule. It claims that the decisions of this Court in the cases
cited do not warrant the construction sought to be placed upon, them by
appellant for a mere perusal thereof would show that the liability of the carrier
was predicated not upon mere breach of its contract of carriage but upon the
finding that its negligence was found to be the direct or proximate cause of the
injury complained of. Thus, appellee contends that "if there is no negligence on
the part of the common carrier but that the accident resulting in injuries is due
to causes which are inevitable and which could not have been avoided or
anticipated notwithstanding the exercise of that high degree of care and skill
which the carrier is bound to exercise for the safety of his passengers", neither
the common carrier nor the driver is liable therefor.
We believe that the law concerning the liability of a common carrier has now
suffered a substantial modification in view of the innovations introduced by the
new Civil Code. These innovations are the ones embodied in Articles 1733,
1755 and 1756 in so far as the relation between a common carrier and its
passengers is concerned, which, for ready reference, we quote hereunder:
ART. 1733. Common carriers, from the nature of their business and for
reasons of public policy, are bound to observe extra ordinary diligence in the
vigilance over the goods and for the safety of the passengers transported by
them according to all the circumstances of each case.
Such extraordinary diligence in the vigilance over the goods is further
expressed in articles 1734, 1735, and 1745, Nos. 5, 6, and 7, while the
extraordinary diligence for the safety of the passengers is further set forth in
articles 1755 and 1756.
ART. 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.
ART. 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.
The Code Commission, in justifying this extraordinary diligence required of a
common carrier, says the following:
A common carrier is bound to carry the passengers safely as far as human
care and foresight can provide, using the utmost deligence of very cautions
persons, with due regard for all circumstances. This extraordinary diligence
required of common carriers is calculated to protect the passengers from the
tragic mishaps that frequently occur in connection with rapid modern
transportation. This high standard of care is imperatively demanded by the
precariousness of human life and by the consideration that every person must
in every way be safeguarded against all injury. (Report of the Code
Commission, pp. 35-36)" (Padilla, Civil Code of the Philippines, Vol. IV, 1956
ed., p. 197).
From the above legal provisions, we can make the following restatement of the
principles governing the liability of a common carrier: (1) the liability of a carrier
is contractual and arises upon breach of its obligation. There is breach if it fails
to exert extraordinary diligence according to all circumstances of each case;
(2) a carrier is obliged to carry its passenger with the utmost diligence of a very
cautious person, having due regard for all the circumstances; (3) a carrier is
presumed to be at fault or to have acted negligently in case of death of, or
injury to, passengers, it being its duty to prove that it exercised extraordinary
diligence; and (4) the carrier is not an insurer against all risks of travel.
The question that now arises is: Has defendant observed extraordinary
diligence or the utmost diligence of every cautious person, having due regard
for all circumstances, in avoiding the collision which resulted in the injury
caused to the plaintiff?
After examining the evidence in connection with how the collision occurred, the
lower court made the following finding:
Hemos examinado muy detenidamente las pruebas presentadas en la vista,
principalmente, las declaraciones que hemos acotado arriba, y hernos Ilegado
a la conclusion de que el demandado ha hecho, todo cuanto estuviere de su
parte para evitar el accidente, pero sin embargo, no ha podido evitarlo.

lane. The driver of the bus, upon seeing the manner in which the pick-up was
then running, swerved the bus to the very extreme right of the road until its
front and rear wheels have gone over the pile of stones or gravel situated on
the rampart of the road. Said driver could not move the bus farther right and
run over a greater portion of the pile, the peak of which was about 3 feet high,
without endangering the safety of his passengers. And notwithstanding all
these efforts, the rear left side of the bus was hit by the pick-up car.
Of course, this finding is disputed by appellant who cannot see eye to eye with
the evidence for the appellee and insists that the collision took place because
the driver of the bus was going at a fast speed. He contends that, having seen
that a car was coming from the opposite direction at a distance which allows
the use of moderate care and prudence to avoid an accident, and knowing that
on the side of the road along which he was going there was a pile of gravel,
the driver of the bus should have stopped and waited for the vehicle from the
opposite direction to pass, and should have proceeded only after the other
vehicle had passed. In other words, according to appellant, the act of the
driver of the bus in squeezing his way through of the bus in squeezing his way
through between the oncoming pick-up and the pile of gravel under the
circumstances was considered negligent.
But this matter is one of credibility and evaluation of the evidence. This is
evidence. This is the function of the trial court. The trial court has already
spoken on this matter as we have pointed out above. This is also a matter of
appreciation of the situation on the part of the driver. While the position taken
by appellant appeals more to the sense of caution that one should observe in
a given situation to avoid an accident or mishap, such however can not always
be expected from one who is placed suddenly in a predicament where he is
not given enough time to take the course of action as he should under ordinary
circumstances. One who is placed in such a predicament cannot exercise
such coolness or accuracy of judgment as is required of him under ordinary
circumstances and he cannot therefore be expected to observe the same
judgment, care and precaution as in the latter. For this reason, authorities
abound where failure to observe the same degree of care that as ordinary
prudent man would exercise under ordinary circumstances when confronted
with a sadden emergency was held to be warranted and a justification to
exempt the carrier from liability. Thus, it was held that "where a carrier's
employee is confronted with a sudden emergency, the fact that he is obliged to
act quickly and without a chance for deliberation must be taken into account,
and he is held to the some degree of care that he would otherwise be required
to exercise in the absence of such emergency but must exercise only such
care as any ordinary prudent person would exercise under like circumstances
and conditions, and the failure on his part to exercise the best judgement the
case renders possible does not establish lack of care and skill on his part
which renders the company, liable. . . . (13 C. J. S., 1412; 10 C. J.,970).
Considering all the circumstances, we are persuaded to conclude that the
driver of the bus has done what a prudent man could have done to avoid the
collision and in our opinion this relieves appellee from legibility under our law.
A circumstances which miliates against the stand of appellant is the fact borne
out by the evidence that when he boarded the bus in question, he seated
himself on the left side thereof resting his left arm on the window sill but with
his left elbow outside the window, this being his position in the bus when the
collision took place. It is for this reason that the collision resulted in the
severance of said left arm from the body of appellant thus doing him a great
damage. It is therefore apparent that appellant is guilty of contributory
negligence. Had he not placed his left arm on the window sill with a portion
thereof protruding outside, perhaps the injury would have been avoided as is
the case with the other passenger. It is to be noted that appellant was the only
victim of the collision.
It is true that such contributory negligence cannot relieve appellee of its liability
but will only entitle it to a reduction of the amount of damage caused (Article
1762, new Civil Code), but this is a circumstance which further militates
against the position taken by appellant in this case.
It is the prevailing rule that it is negligence per se for a passenger on a railroad
voluntarily or inadvertently to protrude his arm, hand, elbow, or any other part
of his body through the window of a moving car beyond the outer edge of the
window or outer surface of the car, so as to come in contact with objects or
obstacles near the track, and that no recovery can be had for an injury which
but for such negligence would not have been sustained. (10 C. J. 1139)
Plaintiff, (passenger) while riding on an interurban car, to flick the ashes, from
his cigar, thrust his hand over the guard rail a sufficient distance beyond the
side line of the car to bring it in contact with the trunk of a tree standing beside
the track; the force of the blow breaking his wrist. Held, that he was guilty of
contributory negligence as a matter of law. (Malakia vs. Rhode Island Co., 89
A., 337.)
Wherefore, the decision appealed from is affirmed, with cost against appellant.

EI hecho de que el demandado, antes del choque, tuvo que hacer pasar su
truck encima de los montones de grava que estaban depositados en la orilla
del camino, sin que haya ido mas alla, por el grave riesgo que corrian las
vidas de sus pasajeros, es prueba concluyente de lo que tenemos dicho, a
saber: que el cuanto esuba de su parte, para evitar el accidente, sin que
haya podidoevitardo, por estar fuera de su control.
The evidence would appear to support the above finding. Thus, it appears that
Bus No. 31, immediately prior to the collision, was running at a moderate
speed because it had just stopped at the school zone of Matacong, Polangui,
Albay. The pick-up car was at full speed and was running outside of its proper

Paras, C.J., Bengzon, Padilla, Montemayor, Reyes, A., Labrador, Concepcion,

Endencia and Felix, JJ., concur.

G.R. No. 169891

November 2, 2006

PHILIPPINE NATIONAL RAILWAYS, Petitioner,

vs.
26

ETHEL BRUNTY and JUAN MANUEL M. GARCIA, Respondents.

DECISION
CALLEJO, SR., J.:
This is a Petition for Review on Certiorari of the Decision1 of the Court of
Appeals (CA) in CA-G.R. CV No. 47567 and its Resolution2 denying the
motion for reconsideration thereof. The assailed decision affirmed with partial
modification the ruling3 of the Regional Trial Court (RTC) of Manila, Branch
20, directing petitioner Philippine National Railways (PNR) to indemnify
respondents Ethel Brunty and Juan Manuel M. Garcia for the death of Rhonda
Brunty, and to pay actual and moral damages, attorneys fees and cost of suit.
Rhonda Brunty, daughter of respondent Ethel Brunty and an American citizen,
came to the Philippines for a visit sometime in January 1980. Prior to her
departure, she, together with her Filipino host Juan Manuel M. Garcia, traveled
to Baguio City on board a Mercedes Benz sedan with plate number FU 799,
driven by Rodolfo L. Mercelita. It was about 12:00 midnight, January 25, 1980.
By then, PNR Train No. T-71, driven by Alfonso Reyes, was on its way to
Tutuban, Metro Manila4 as it had left the La Union station at 11:00 p.m.,
January 24, 1980.
By 2:00 a.m., Rhonda Brunty, Garcia and Mercelita were already approaching
the railroad crossing at Barangay Rizal, Moncada, Tarlac. Mercelita, driving at
approximately 70 km/hr, drove past a vehicle, unaware of the railroad track up
ahead and that they were about to collide with PNR Train No. T-71. Mercelita
was instantly killed when the Mercedes Benz smashed into the train; the two
other passengers suffered serious physical injuries.5 A certain James Harrow6
brought Rhonda Brunty to the Central Luzon Doctors Hospital in Tarlac, where
she was pronounced dead after ten minutes from arrival. Garcia, who had
suffered severe head injuries, was brought via ambulance to the same
hospital. He was transferred to the Manila Doctors Hospital, and later to the
Makati Medical Center for further treatment.7
On July 28, 1981, Ethel Brunty sent a demand letter8 to the PNR demanding
payment of actual, compensatory, and moral damages, as a result of her
daughters death. When PNR did not respond, Ethel Brunty and Garcia, filed a
complaint9 for damages against the PNR before the RTC of Manila. The case
was raffled to Branch 20 and was docketed as Civil Case No. 83-18645. They
alleged that the death of Mercelita and Rhonda Brunty, as well as the physical
injuries suffered by Garcia, were the direct and proximate result of the gross
and reckless negligence of PNR in not providing the necessary equipment at
the railroad crossing in Barangay Rizal, Municipality of Moncada, Tarlac. They
pointed out that there was no flagbar or red light signal to warn motorists who
were about to cross the railroad track, and that the flagman or switchman was
only equipped with a hand flashlight.10 Plaintiffs likewise averred that PNR
failed to supervise its employees in the performance of their respective tasks
and duties, more particularly the pilot and operator of the train.11 They prayed
for the payment of the following damages:
1.) P200,000.00 as actual and compensatory damages to plaintiff Ethel Brunty;
2.) P2,800,000.00 for compensatory damages to plaintiff Ethel Brunty
representing lost or unearned income of Rhonda Brunty;

After trial on the merits, the RTC rendered its Decision19 on May 21, 1990 in
favor of plaintiffs. The fallo reads:
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs Ethel
Brunty and Juan Manuel M. Garcia and against the defendant Philippine
National Railways directing the latter to pay the former the sum of:
1. Thirty Thousand Pesos (P30,000.00) Philippine Currency, for the death of
Rhonda Brunty formerly a resident of 1595 Ashland Avenue, Des Plaines,
Illinois, U.S.A.;
2. One Million Pesos (P1,000,000.00) Philippine Currency for moral and actual
damages due the heirs of Rhonda Brunty;
3. Seventy-Two Thousand Seven Hundred Sixty Pesos (P72,760.00)
Philippine Currency for damages sustained by the Mercedes Benz;
4. Fifty Thousand Pesos (P50,000.00) Philippine Currency as and for
attorney's fees, and;
5. Costs of suit.
SO ORDERED.20
Aggrieved, the PNR appealed the case to the CA, raising the following errors:
I.
THE TRIAL COURT ERRED IN ADJUDGING DEFENDANT-APPELLANT PNR
LIABLE FOR THE DEATH OF RHONDA BRUNTY AND THE CONSEQUENT
AWARD OF DAMAGES DUE THE HEIRS OF RHONDA BRUNTY.
II.
THE TRIAL COURT ERRED IN ADJUDGING DEFENDANT-APPELLANT PNR
LIABLE FOR THE DAMAGES SUFFERED BY PLAINTIFF-APPELLEES
MERCEDES BENZ IN THE AMOUNT OF SEVENTY-TWO THOUSAND
SEVEN HUNDRED AND SIXTY PESOS (P72,760.00).
III.
THE LOWER COURT ERRED IN AWARDING ATTORNEYS FEES TO THE
PLAINTIFFS-APPELLEES.21
In its Brief, PNR insisted that the sole and proximate cause of the accident
was the negligence and recklessness of Garcia and Mercelita.22 It insisted
that it had provided adequate warning signals at the railroad crossing23 and
had exercised due care in the selection and supervision of its employees.24
The RTC erred in awarding damages to Rhonda Brunty as she cannot be
allowed to receive what she is not in a position to give, having been a nonresident alien who did not own a property in the Philippines.25 It likewise
questioned the award of damages on the Mercedes Benz as well as the grant
of attorneys fees.26 At the very least, Mercelita was guilty of contributory
negligence.27

5.) At least P72,760.00 as actual damages representing cost of the Mercedes

Benz car to plaintiff Juan Manuel M. Garcia;

For their part, appellees countered that appellant was grossly and recklessly
negligent in not properly providing the necessary equipment at the railroad
crossing in Rizal, Moncada, Tarlac;28 appellant was negligent in not exercising
due diligence of a good father of a family in the supervision of its employees,
particularly the train operator Alfonso Reyes;29 the car was driven in a careful
and diligent manner, and at a moderate speed, with due regard to all traffic
rules and regulations at that particular time;30 the doctrine of "last clear
chance" is not applicable;31 Ethel Brunty is a non-resident alien who can
rightfully file the instant case;32 and they are entitled to recover damages from
appellant.33

6.) Such amounts of moral and exemplary damages as may be warranted by

the evidence adduced, to plaintiff Juan Manuel M. Garcia; and

The CA rendered the assailed Decision34 on August 15, 2005. The dispositive
portion reads:

7.) Attorneys fees equivalent to at least 15% of the total award to plaintiffs
herein.12

WHEREFORE, premises considered, the assailed decision is hereby

AFFIRMED with PARTIAL MODIFICATIONS, increasing the death indemnity
award from P30,000.00 to P50,000.00, and deleting the award for damages
sustained by the Mercedes Benz.

3.) Such amounts of moral and exemplary damages as may be warranted by

the evidence adduced, to plaintiff Ethel Brunty;
4.) At least P64,057.61 as actual damages representing medical expenses to
plaintiff Juan Manuel M. Garcia and at least P1,000,000.00 as unearned or lost
income of said plaintiff;

In its Answer,13 PNR claimed that it exercised the diligence of a good father of
a family not only in the selection but also in the supervision of its
employees.14 By way of special and affirmative defense, it stressed that it had
the right of way on the railroad crossing in question, and that it has no legal
duty to put up a bar or red light signal in any such crossing. It insisted that
there were adequate, visible, and clear warning signs strategically posted on
the sides of the road before the railroad crossing. It countered that the
immediate and proximate cause of the accident was Mercelitas negligence,
and that he had the last clear chance to avoid the accident. The driver
disregarded the warning signs, the whistle blasts of the oncoming train and the
flashlight signals to stop given by the guard.15 As counterclaim, it prayed that
it be awarded actual and compensatory damages, and litigation expenses.16
Plaintiffs filed an Amended Complaint17 dated July 28, 1986 to include, as
party plaintiff, Chemical Industries of the Philippines, Inc. (Chemphil), Garcias
employer, who claimed to have paid for the latters medical and hospitalization
expenses, the services rendered by the funeral parlor of the deceased, and
the expenses in transferring the remains of Rhonda Brunty to the United
States.18

SO ORDERED.35
The appellate court affirmed the findings of the RTC as to the negligence of
the PNR. Considering the circumstances prevailing at the time of the fatal
accident, it ruled that the alleged safety measures installed by the PNR at the
railroad crossing were not merely inadequate they did not satisfy the wellsettled safety standards in transportation.36 However, the CA did not agree
with the RTCs findings on the contributory negligence of Mercelita, the driver
of the Mercedes Benz. It held that Mercelita could not have foreseen the harm
that would befall him and the two other passengers under the prevailing
circumstances, thus, could not be considered guilty of contributory
negligence.37
The PNR, now petitioner, comes before this Court in this Petition for Review
on Certiorari on the following grounds:
I.
27

THE COURT OF APPEALS ERRED IN MANIFESTLY OVERLOOKING

CERTAIN RELEVANT FACTS NOT DISPUTED BY THE PARTIES AND
WHICH, IF PROPERLY CONSIDERED, WOULD JUSTIFY A DIFFERENT
CONCLUSION SUCH AS:
THE RESPONDENTS DRIVER OVERTOOK ANOTHER VEHICLE BY
ACCELERATING AT 70 KILOMETERS PER HOUR WITHIN JUST 50 YARDS
AWAY FROM THE RAILROAD TRACKS.
II.
THE FINDINGS OF FACT OF THE COURT OF APPEALS ARE CONTRARY
TO THOSE OF THE TRIAL COURT REGARDING CONTRIBUTORY
NEGLIGENCE OF THE RESPONDENTS DRIVER.
III.
THE COURT OF APPEALS ERRED IN NOT APPLYING THE DOCTRINE OF
LAST CLEAR CHANCE IN THE INSTANT CASE.38
Petitioner insists that the proximate cause of the mishap was Mercelitas
disregard of traffic rules and regulations. Had the court considered the fact that
Mercelita had overtaken another vehicle a few yards before the railroad track,
it would have reached a different conclusion.39 Moreover, petitioner asserts,
considering that the decisions of the RTC and the CA vary as to whether or not
Mercelita was guilty of contributory negligence, the findings of the RTC should
prevail. Thus, Mercelitas contributory negligence should not have been
ignored.40 Lastly, petitioner avers that since there is freedom of control and
greater maneuverability on the part of motor vehicles, it is obvious that in
railroad crossings, they have the last clear chance to prevent or avoid an
unwanted accident from taking place.41
In their Comment42 on the petition, respondents reiterate the findings of the
RTC and the CA that the breach by petitioner of its legal duty to provide
adequate and necessary public safety device and equipment within the area or
scene of the accident was the proximate cause of the mishap.43 While it is
true that as a general rule, the trial court is in the best position to evaluate and
observe the conduct and demeanor of the witnesses presented during the trial,
the CA, in the exercise of its appellate jurisdiction, has the vested right to
modify, reject, or set aside the trial courts evaluation and findings.44 As to the
application of the doctrine of last clear chance, respondents claim that said
issue is being raised for the first time in this petition.45 Lastly, respondents cite
foreign jurisprudence stating that if the violation is one which gives rise to
liability per se for any resulting injury, the defenses ordinarily available in
actions for diligence are barred and the contributory negligence of the person
injured is no defense.46
The Court is thus tasked to answer the following factual questions: (1) As
between petitioner and Mercelita, whose negligence resulted in the
unfortunate collision? (2) Is Mercelita (the driver of the Mercedes Benz) guilty
of contributory negligence? Finally, the application in this case of the doctrine
of last clear chance is likewise in question.
Negligence is the omission to do something which a reasonable man, guided
by those considerations which ordinarily regulate the conduct of human affairs,
would do, or the doing of something which a prudent and reasonable man
would not do.47 In Corliss v. Manila Railroad Company,48 this Court held that
negligence is want of the care required by the circumstances. It is a relative or
comparative, not an absolute, term and its application depends upon the
situation of the parties and the degree of care and vigilance which the
circumstances reasonably require.49 In determining whether or not there is
negligence on the part of the parties in a given situation, jurisprudence50 has
laid down the following test: Did defendant, in doing the alleged negligent act,
use that reasonable care and caution which an ordinarily prudent person
would have used in the same situation? If not, the person is guilty of
negligence. The law, in effect, adopts the standard supposed to be supplied by
the imaginary conduct of the discreet pater familias of the Roman law.
The issue of who, between the parties, was negligent was thoroughly
discussed by both the RTC and the CA. In petitions for review under Rule 45
of the Revised Rules of Court, only questions of law may be put into issue, and
questions of fact as a general rule, cannot be entertained. The finding of
negligence by the RTC, as affirmed by the CA, is a question of fact which this
Court cannot pass upon as it would entail going into factual matters on which
the finding of negligence was based.51 The established rule is that factual
findings of the CA affirming those of the trial court are conclusive and binding
on this Court.52
The records of the instant case show that both the RTC and the CA carefully
examined the factual circumstances surrounding the case, and we find no
cogent reason to disturb the same. It is, however, worthy to emphasize that
petitioner was found negligent because of its failure to provide the necessary
safety device to ensure the safety of motorists in crossing the railroad track. As
such, it is liable for damages for violating the provisions of Article 2176 of the
New Civil Code, viz:
Article 2176. Whoever, by act or omission, causes damage to another, there
being fault or negligence, is obliged to pay for the damage done. Such fault or
negligence, if there is no pre-existing contractual relation between the parties,
is called a quasi-delict and is governed by the provisions of this Chapter.
In a long line of cases, the Court held that in order to sustain a claim based on

quasi-delict, the following requisites must concur: (1) damage to plaintiff; (2)
negligence, by act or omission, of which defendant, or some person for whose
acts he must respond was guilty; and (3) connection of cause and effect
between such negligence and damage.53 Applying the foregoing requisites,
the CA correctly made the following conclusions:
It was clearly established that plaintiffs-appellees (respondents herein)
sustained damage or injury as a result of the collision. That there was
negligence on the part of PNR is, likewise, beyond cavil. Considering the
circumstances prevailing at the time of the fatal accident, the alleged safety
measures installed by the PNR at the railroad crossing is not only inadequate
but does not satisfy well-settled safety standards in transportation. x x x
xxxx
x x x An examination of the photographs of the railroad crossing at Moncada,
Tarlac presented as evidence by PNR itself would yield the following: (1.)
absence of flagbars or safety railroad bars; (2.) inadequacy of the installed
warning signals; and (3.) lack of proper lighting within the area. Thus, even if
there was a flagman stationed at the site as claimed by PNR (petitioner), it
would still be impossible to know or see that there is a railroad crossing/tracks
ahead, or that there is an approaching train from the Moncada side of the road
since ones view would be blocked by a cockpit arena. x x x54
Moreover, the CA held that a vehicle coming from the Moncada side would
have difficulty in knowing that there is an approaching train because of the
slight curve, more so, at an unholy hour as 2:00 a.m. Thus, it is imperative on
the part of the PNR to provide adequate safety equipment in the area.55
It may broadly be stated that railroad companies owe to the public a duty of
exercising a reasonable degree of care to avoid injury to persons and property
at railroad crossings, which duties pertain both in the operation of trains and in
the maintenance of the crossings.56 Moreover, every corporation constructing
or operating a railway shall make and construct at all points where such
railway crosses any public road, good, sufficient, and safe crossings and erect
at such points, at a sufficient elevation from such road as to admit a free
passage of vehicles of every kind, a sign with large and distinct letters placed
thereon, to give notice of the proximity of the railway, and warn persons of the
necessity of looking out for trains.57
This Court has previously determined the liability of the PNR for damages for
its failure to put a cross bar, or signal light, flagman or switchman, or
semaphores. Such failure is evidence of negligence and disregard of the
safety of the public, even if there is no law or ordinance requiring it because
public safety demands that said device or equipment be installed.58
In view of the foregoing, we affirm the factual findings of the CA as well as its
conclusion on petitioners negligence.
As to whether or not Mercelita was guilty of contributory negligence, we agree
with petitioner. Contributory negligence is conduct on the part of the injured
party, contributing as a legal cause to the harm he has suffered, which falls
below the standard to which he is required to conform for his own
protection.59 To hold a person as having contributed to his injuries, it must be
shown that he performed an act that brought about his injuries in disregard of
warning or signs of an impending danger to health and body.60 To prove
contributory negligence, it is still necessary to establish a causal link, although
not proximate, between the negligence of the party and the succeeding injury.
In a legal sense, negligence is contributory only when it contributes
proximately to the injury, and not simply a condition for its occurrence.61
The court below found that there was a slight curve before approaching the
tracks; the place was not properly illuminated; ones view was blocked by a
cockpit arena; and Mercelita was not familiar with the road. Yet, it was also
established that Mercelita was then driving the Mercedes Benz at a speed of
70 km/hr and, in fact, had overtaken a vehicle a few yards before reaching the
railroad track. Mercelita should not have driven the car the way he did.
However, while his acts contributed to the collision, they nevertheless do not
negate petitioners liability. Pursuant to Article 217962 of the New Civil Code,
the only effect such contributory negligence could have is to mitigate liability,
which, however, is not applicable in this case, as will be discussed
later.1wphi1
As to whether or not the doctrine of last clear chance is applicable, we rule in
the negative. The doctrine of last clear chance states that where both parties
are negligent but the negligent act of one is appreciably later than that of the
other, or where it is impossible to determine whose fault or negligence caused
the loss, the one who had the last clear opportunity to avoid the loss but failed
to do so, is chargeable with the loss. Stated differently, the antecedent
negligence of plaintiff does not preclude him from recovering damages caused
by the supervening negligence of defendant, who had the last fair chance to
prevent the impending harm by the exercise of due diligence.63 The proximate
cause of the injury having been established to be the negligence of petitioner,
we hold that the above doctrine finds no application in the instant case.
We note that the damages awarded by the appellate court consist of (1)
P50,000.00 as indemnity for the death of Rhonda Brunty; (2) P1,000,000.00 as
actual and moral damages due the heirs of Rhonda Brunty; and (3)
P50,000.00 as and by way of attorneys fees. No damages, however, were
awarded for the injuries suffered by Garcia, yet, the latter never interposed an
appeal before the CA nor even before this Court. The record is, likewise, bereft
of any allegation and proof as to the relationship between Mercelita (the driver)
28

and Rhonda Brunty. Hence, the earlier finding of contributory negligence on

the part of Mercelita, which generally has the effect of mitigation of liability,
does not apply.
As to the amount of damages awarded, a modification of the same is in order,
specifically on the award of actual and moral damages in the aggregate
amount of P1,000,000.00.
Actual or compensatory damages are those awarded in order to compensate a
party for an injury or loss he suffered. They arise out of a sense of natural
justice, aimed at repairing the wrong done. To be recoverable, they must be
duly proved with a reasonable degree of certainty. A court cannot rely on
speculation, conjecture, or guesswork as to the fact and amount of damages,
but must depend upon competent proof that they have suffered, and on
evidence of the actual amount thereof.64 Respondents, however, failed to
present evidence for such damages; hence, the award of actual damages
cannot be sustained. However, as the heirs of Rhonda Brunty undeniably
incurred expenses for the wake and burial of the latter, we deem it proper to
award temperate damages in the amount of P25,000.00 pursuant to prevailing
jurisprudence.65 This is in lieu of actual damages as it would be unfair for the
victims heirs to get nothing, despite the death of their kin, for the reason alone
that they cannot produce receipts.66
The relatives of the victim who incurred physical injuries in a quasi-delict are
not proscribed from recovering moral damages in meritorious cases.67 We,
therefore, sustain the award of moral damages in favor of the heirs of Rhonda
Brunty.
Moral damages are not punitive in nature, but are designed to compensate
and alleviate in some way the physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded feelings, moral shock, social
humiliation, and similar injury unjustly caused a person. Although incapable of
pecuniary computation, moral damages must nevertheless be somehow
proportional to and in approximation of the suffering inflicted.68 In the instant
case, the moral suffering of the heirs of Rhonda Brunty was sufficiently
established by Ethel Brunty in her deposition,69 viz:
Q: What have you felt as a result of the death of Rhonda?
A: I felt earnest anguish and mixed feelings of anger and extreme sorrow
because she died so far away and alone, and because her death could so
easily be prevented if there had been adequate and appropriate warning
signals at the railroad crossing and it is just an unbearable and irreparable
loss. In so many ways, she was my life. It seemed to me that losing her was
just like losing my own life, or worst, and even now, there is no end to our
bereavement. I am still on constant medication to be able to sleep and to be
able to perform my duties effectively in my job but it does not take away the
pain of loss.70

This is a petition to review on certiorari the decision* rendered by the Court of

Appeals dated 19 October 1979 in CA-G.R. No. 57354-R entitled "Jose Pilapil,
plaintiff-appellee versus Alatco Transportation Co., Inc., defendant-appellant,"
which reversed and set aside the judgment of the Court of First Instance of
Camarines Sur in Civil Case No. 7230 ordering respondent transportation
company to pay to petitioner damages in the total sum of sixteen thousand
three hundred pesos (P 16,300.00).
The record discloses the following facts:
Petitioner-plaintiff Jose Pilapil, a paying passenger, boarded respondentdefendant's bus bearing No. 409 at San Nicolas, Iriga City on 16 September
1971 at about 6:00 P.M. While said bus No. 409 was in due course negotiating
the distance between Iriga City and Naga City, upon reaching the vicinity of the
cemetery of the Municipality of Baao, Camarines Sur, on the way to Naga City,
an unidentified man, a bystander along said national highway, hurled a stone
at the left side of the bus, which hit petitioner above his left eye. Private
respondent's personnel lost no time in bringing the petitioner to the provincial
hospital in Naga City where he was confined and treated.
Considering that the sight of his left eye was impaired, petitioner was taken to
Dr. Malabanan of Iriga City where he was treated for another week. Since
there was no improvement in his left eye's vision, petitioner went to V. Luna
Hospital, Quezon City where he was treated by Dr. Capulong. Despite the
treatment accorded to him by Dr. Capulong, petitioner lost partially his left
eye's vision and sustained a permanent scar above the left eye.
Thereupon, petitioner instituted before the Court of First Instance of
Camarines Sur, Branch I an action for recovery of damages sustained as a
result of the stone-throwing incident. After trial, the court a quo rendered
judgment with the following dispositive part:
Wherefore, judgment is hereby entered:
1.
Ordering defendant transportation company to pay plaintiff Jose
Pilapil the sum of P 10,000.00, Philippine Currency, representing actual and
material damages for causing a permanent scar on the face and injuring the
eye-sight of the plaintiff;
2.
Ordering further defendant transportation company to pay the sum
of P 5,000.00, Philippine Currency, to the plaintiff as moral and exemplary
damages;
3.
Ordering furthermore, defendant transportation company to
reimburse plaintiff the sum of P 300.00 for his medical expenses and
attorney's fees in the sum of P 1,000.00, Philippine Currency; and
4.

In People v. Teehankee, Jr.,71 and in Metro Manila Transit Corporation v.

Court of Appeals,72 we awarded moral damages in the amount of
P1,000,000.00 to the heirs of the deceased. In Victory Liner, Inc. v. Heirs of
Malecdan,73 the award of P100,000.00 as moral damages was held in
keeping with the purpose of the law, while in Macalinao v. Ong,74 the amount
of P50,000.00 was held sufficient.1wphi1
Considering the circumstances attendant in this case, we find that an award of
P500,000.00 as moral damages to the heirs of Rhonda Brunty is proper. In
view of recent jurisprudence, indemnity of P50,000.00 for the death of Rhonda
Brunty and attorneys fees amounting to P50,000.00 is likewise proper.

To pay the costs.

SO ORDERED 1
From the judgment, private respondent appealed to the Court of Appeals
where the appeal was docketed as CA-G.R. No. 57354R. On 19 October
1979, the Court of Appeals, in a Special Division of Five, rendered judgment
reversing and setting aside the judgment of the court a quo.
Hence the present petition.

WHEREFORE, premises considered, the Decision of the Court of Appeals

dated August 15, 2005 is AFFIRMED WITH MODIFICATIONS. The award of
actual damages is deleted, and in lieu thereof, temperate damages of
P25,000.00 is awarded to the heirs of Rhonda Brunty. The award of moral
damages is reduced to P500,000.00.

In seeking a reversal of the decision of the Court of Appeals, petitioner

contends that said court has decided the issue not in accord with law.
Specifically, petitioner argues that the nature of the business of a
transportation company requires the assumption of certain risks, and the
stoning of the bus by a stranger resulting in injury to petitioner-passenger is
one such risk from which the common carrier may not exempt itself from
liability.

SO ORDERED.

We do not agree.

ROMEO J. CALLEJO, SR.

Associate Justice

In consideration of the right granted to it by the public to engage in the

business of transporting passengers and goods, a common carrier does not
give its consent to become an insurer of any and all risks to passengers and
goods. It merely undertakes to perform certain duties to the public as the law
imposes, and holds itself liable for any breach thereof.

WE CONCUR:

G.R. No. 52159

December 22, 1989

JOSE PILAPIL, petitioner,

vs.
HON. COURT OF APPEALS and ALATCO TRANSPORTATION
COMPANY, INC., respondents.
Martin Badong, Jr. for petitioner.

Under Article 1733 of the Civil Code, common carriers are required to observe
extraordinary diligence for the safety of the passenger transported by them,
according to all the circumstances of each case. The requirement of
extraordinary diligence imposed upon common carriers is restated in 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 due regard for all the circumstances." Further, in case
of death of or injuries to passengers, the law presumes said common carriers
to be at fault or to have acted negligently. 2

Eufronio K. Maristela for private respondent.

While the law requires the highest degree of diligence from common carriers in
the safe transport of their passengers and creates a presumption of
negligence against them, it does not, however, make the carrier an insurer of
the absolute safety of its passengers. 3

PADILLA, J.:

Article 1755 of the Civil Code qualifies the duty of extraordinary care, vigilance
and precaution in the carriage of passengers by common carriers to only such
29

as human care and foresight can provide. what constitutes compliance with
said duty is adjudged with due regard to all the circumstances.

WHEREFORE, the judgment appealed from is hereby AFFIRMED.

SO ORDERED.

Article 1756 of the Civil Code, in creating a presumption of fault or negligence

on the part of the common carrier when its passenger is injured, merely
relieves the latter, for the time being, from introducing evidence to fasten the
negligence on the former, because the presumption stands in the place of
evidence. Being a mere presumption, however, the same is rebuttable by proof
that the common carrier had exercised extraordinary diligence as required by
law in the performance of its contractual obligation, or that the injury suffered
by the passenger was solely due to a fortuitous event. 4
In fine, we can only infer from the law the intention of the Code Commission
and Congress to curb the recklessness of drivers and operators of common
carriers in the conduct of their business.
Thus, it is clear that neither the law nor the nature of the business of a
transportation company makes it an insurer of the passenger's safety, but that
its liability for personal injuries sustained by its passenger rests upon its
negligence, its failure to exercise the degree of diligence that the law requires.
5
Petitioner contends that respondent common carrier failed to rebut the
presumption of negligence against it by proof on its part that it exercised
extraordinary diligence for the safety of its passengers.

Melencio-Herrera (Chairperson), Sarmiento and Regalado, concur.

Paras, J., took no part.

G.R. No. L-55300

March 15, 1990

FRANKLIN G. GACAL and CORAZON M. GACAL, the latter

assisted by her husband, FRANKLIN G. GACAL, petitioners,
vs.
PHILIPPINE AIR LINES, INC., and THE HONORABLE PEDRO
SAMSON C. ANIMAS, in his capacity as PRESIDING JUDGE of
the COURT OF FIRST INSTANCE OF SOUTH COTABATO,
BRANCH I, respondents.
Vicente A. Mirabueno for petitioners.
Siguion Reyna, Montecillo & Ongsiako for private respondent.

We do not agree.
First, as stated earlier, the presumption of fault or negligence against the
carrier is only a disputable presumption. It gives in where contrary facts are
established proving either that the carrier had exercised the degree of
diligence required by law or the injury suffered by the passenger was due to a
fortuitous event. Where, as in the instant case, the injury sustained by the
petitioner was in no way due to any defect in the means of transport or in the
method of transporting or to the negligent or willful acts of private respondent's
employees, and therefore involving no issue of negligence in its duty to
provide safe and suitable cars as well as competent employees, with the injury
arising wholly from causes created by strangers over which the carrier had no
control or even knowledge or could not have prevented, the presumption is
rebutted and the carrier is not and ought not to be held liable. To rule otherwise
would make the common carrier the insurer of the absolute safety of its
passengers which is not the intention of the lawmakers.
Second, while as a general rule, common carriers are bound to exercise
extraordinary diligence in the safe transport of their passengers, it would seem
that this is not the standard by which its liability is to be determined when
intervening acts of strangers is to be determined directly cause the injury, while
the contract of carriage Article 1763 governs:
Article 1763.
A common carrier is responsible for injuries suffered by
a passenger on account of the wilful 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.
Clearly under the above provision, a tort committed by a stranger which
causes injury to a passenger does not accord the latter a cause of action
against the carrier. The negligence for which a common carrier is held
responsible is the negligent omission by the carrier's employees to prevent the
tort from being committed when the same could have been foreseen and
prevented by them. Further, under the same provision, it is to be noted that
when the violation of the contract is due to the willful acts of strangers, as in
the instant case, the degree of care essential to be exercised by the common
carrier for the protection of its passenger is only that of a good father of a
family.
Petitioner has charged respondent carrier of negligence on the ground that the
injury complained of could have been prevented by the common carrier if
something like mesh-work grills had covered the windows of its bus.
We do not agree.
Although the suggested precaution could have prevented the injury
complained of, the rule of ordinary care and prudence is not so exacting as to
require one charged with its exercise to take doubtful or unreasonable
precautions to guard against unlawful acts of strangers. The carrier is not
charged with the duty of providing or maintaining vehicles as to absolutely
prevent any and all injuries to passengers. Where the carrier uses cars of the
most approved type, in general use by others engaged in the same
occupation, and exercises a high degree of care in maintaining them in
suitable condition, the carrier cannot be charged with negligence in this
respect. 6
Finally, petitioner contends that it is to the greater interest of the State if a
carrier were made liable for such stone-throwing incidents rather than have the
bus riding public lose confidence in the transportation system.
Sad to say, we are not in a position to so hold; such a policy would be better
left to the consideration of Congress which is empowered to enact laws to
protect the public from the increasing risks and dangers of lawlessness in
society.

PARAS, J.:
This is a, petition for review on certiorari of the decision of the Court of First
Instance of South Cotabato, Branch 1, * promulgated on August 26, 1980
dismissing three (3) consolidated cases for damages: Civil Case No. 1701,
Civil Case No. 1773 and Civil Case No. 1797 (Rollo, p. 35).
The facts, as found by respondent court, are as follows:
Plaintiffs Franklin G. Gacal and his wife, Corazon M. Gacal, Bonifacio S.
Anislag and his wife, Mansueta L. Anislag, and the late Elma de Guzman,
were then passengers boarding defendant's BAC 1-11 at Davao Airport for a
flight to Manila, not knowing that on the same flight, Macalinog, Taurac
Pendatum known as Commander Zapata, Nasser Omar, Liling Pusuan Radia,
Dimantong Dimarosing and Mike Randa, all of Marawi City and members of
the Moro National Liberation Front (MNLF), were their co-passengers, three
(3) armed with grenades, two (2) with .45 caliber pistols, and one with a .22
caliber pistol. Ten (10) minutes after take off at about 2:30 in the afternoon, the
hijackers brandishing their respective firearms announced the hijacking of the
aircraft and directed its pilot to fly to Libya. With the pilot explaining to them
especially to its leader, Commander Zapata, of the inherent fuel limitations of
the plane and that they are not rated for international flights, the hijackers
directed the pilot to fly to Sabah. With the same explanation, they relented and
directed the aircraft to land at Zamboanga Airport, Zamboanga City for
refueling. The aircraft landed at 3:00 o'clock in the afternoon of May 21, 1976
at Zamboanga Airport. When the plane began to taxi at the runway, it was met
by two armored cars of the military with machine guns pointed at the plane,
and it stopped there. The rebels thru its commander demanded that a DCaircraft take them to Libya with the President of the defendant company as
hostage and that they be given $375,000 and six (6) armalites, otherwise they
will blow up the plane if their demands will not be met by the government and
Philippine Air Lines. Meanwhile, the passengers were not served any food nor
water and it was only on May 23, a Sunday, at about 1:00 o'clock in the
afternoon that they were served 1/4 slice of a sandwich and 1/10 cup of PAL
water. After that, relatives of the hijackers were allowed to board the plane but
immediately after they alighted therefrom, an armored car bumped the stairs.
That commenced the battle between the military and the hijackers which led
ultimately to the liberation of the surviving crew and the passengers, with the
final score of ten (10) passengers and three (3) hijackers dead on the spot and
three (3) hijackers captured.
City Fiscal Franklin G. Gacal was unhurt. Mrs. Corazon M. Gacal suffered
injuries in the course of her jumping out of the plane when it was peppered
with bullets by the army and after two (2) hand grenades exploded inside the
plane. She was hospitalized at General Santos Doctors Hospital, General
Santos City, for two (2) days, spending P245.60 for hospital and medical
expenses, Assistant City Fiscal Bonifacio S. Anislag also escaped unhurt but
Mrs. Anislag suffered a fracture at the radial bone of her left elbow for which
she was hospitalized and operated on at the San Pedro Hospital, Davao City,
and therefore, at Davao Regional Hospital, Davao City, spending P4,500.00.
Elma de Guzman died because of that battle. Hence, the action of damages
instituted by the plaintiffs demanding the following damages, to wit:
Civil Case No. 1701
City Fiscal Franklin G. Gacal and Mrs. Corazon M. Gacal actual damages:
P245.60 for hospital and medical expenses of Mrs Gacal; P8,995.00 for their
personal belongings which were lost and not recovered; P50,000.00 each for
moral damages; and P5,000.00 for attorney's fees, apart from the prayer for
an award of exemplary damages (Record, pp. 4-6, Civil Case No. 1701).
Civil Case No. 1773
30

xxx

xxx

xxx

impossible to foresee or to avoid. The mere difficulty to foresee the happening

is not impossibility to foresee the same (Republic v. Luzon Stevedoring
Corporation, 21 SCRA 279 [1967]).

xxx

Applying the above guidelines to the case at bar, the failure to transport
petitioners safely from Davao to Manila was due to the skyjacking incident
staged by six (6) passengers of the same plane, all members of the Moro
National Liberation Front (MNLF), without any connection with private
respondent, hence, independent of the will of either the PAL or of its
passengers.

Civil Case No. 1797

xxx

xxx

The trial court, on August 26, 1980, dismissed the complaints finding that all
the damages sustained in the premises were attributed to force majeure.
On September 12, 1980 the spouses Franklin G. Gacal and Corazon M.
Gacal, plaintiffs in Civil Case No. 1701, filed a notice of appeal with the lower
court on pure questions of law (Rollo, p. 55) and the petition for review on
certiorari was filed with this Court on October 20, 1980 (Rollo, p. 30).
The Court gave due course to the petition (Rollo, p. 147) and both parties filed
their respective briefs but petitioner failed to file reply brief which was noted by
the Court in the resolution dated May 3, 1982 (Rollo, p. 183).
Petitioners alleged that the main cause of the unfortunate incident is the gross,
wanton and inexcusable negligence of respondent Airline personnel in their
failure to frisk the passengers adequately in order to discover hidden weapons
in the bodies of the six (6) hijackers. They claimed that despite the prevalence
of skyjacking, PAL did not use a metal detector which is the most effective
means of discovering potential skyjackers among the passengers (Rollo, pp.
6-7).
Respondent Airline averred that in the performance of its obligation to safely
transport passengers as far as human care and foresight can provide, it has
exercised the utmost diligence of a very cautious person with due regard to all
circumstances, but the security checks and measures and surveillance
precautions in all flights, including the inspection of baggages and cargo and
frisking of passengers at the Davao Airport were performed and rendered
solely by military personnel who under appropriate authority had assumed
exclusive jurisdiction over the same in all airports in the Philippines.
Similarly, the negotiations with the hijackers were a purely government matter
and a military operation, handled by and subject to the absolute and exclusive
jurisdiction of the military authorities. Hence, it concluded that the accident that
befell RP-C1161 was caused by fortuitous event, force majeure and other
causes beyond the control of the respondent Airline.

Under normal circumstances, PAL might have foreseen the skyjacking incident
which could have been avoided had there been a more thorough frisking of
passengers and inspection of baggages as authorized by R.A. No. 6235. But
the incident in question occurred during Martial Law where there was a military
take-over of airport security including the frisking of passengers and the
inspection of their luggage preparatory to boarding domestic and international
flights. In fact military take-over was specifically announced on October 20,
1973 by General Jose L. Rancudo, Commanding General of the Philippine Air
Force in a letter to Brig. Gen. Jesus Singson, then Director of the Civil
Aeronautics Administration (Rollo, pp. 71-72) later confirmed shortly before the
hijacking incident of May 21, 1976 by Letter of Instruction No. 399 issued on
April 28, 1976 (Rollo, p. 72).
Otherwise stated, these events rendered it impossible for PAL to perform its
obligations in a nominal manner and obviously it cannot be faulted with
negligence in the performance of duty taken over by the Armed Forces of the
Philippines to the exclusion of the former.
Finally, there is no dispute that the fourth element has also been satisfied.
Consequently the existence of force majeure has been established exempting
respondent PAL from the payment of damages to its passengers who suffered
death or injuries in their persons and for loss of their baggages.
PREMISES CONSIDERED, the petition is hereby DISMISSED for lack of merit
and the decision of the Court of First Instance of South Cotabato, Branch I is
hereby AFFIRMED.
SO ORDERED.
Melencio-Herrera, Padilla, Sarmiento and Regalado, JJ., concur.

The determinative issue in this case is whether or not hijacking or air piracy
during martial law and under the circumstances obtaining herein, is a caso
fortuito or force majeure which would exempt an aircraft from payment of
damages to its passengers whose lives were put in jeopardy and whose
personal belongings were lost during the incident.
Under the Civil Code, common carriers are required to exercise extraordinary
diligence in their vigilance over the goods and for the safety of passengers
transported by them, according to all the circumstances of each case (Article
1733). They are presumed at fault or to have acted negligently whenever a
passenger dies or is injured (Philippine Airlines, Inc. v. National Labor
Relations Commission, 124 SCRA 583 [1983]) or for the loss, destruction or
deterioration of goods in cases other than those enumerated in Article 1734 of
the Civil Code (Eastern Shipping Lines, Inc. v. Intermediate Appellate Court,
150 SCRA 463 [1987]).
The source of a common carrier's legal liability is the contract of carriage, and
by entering into said contract, it binds itself to carry the passengers safely as
far as human care and foresight can provide. There is breach of this obligation
if it fails to exert extraordinary diligence according to all the circumstances of
the case in exercise of the utmost diligence of a very cautious person (Isaac v.
Ammen Transportation Co., 101 Phil. 1046 [1957]; Juntilla v. Fontanar, 136
SCRA 624 [1985]).
It is the duty of a common carrier to overcome the presumption of negligence
(Philippine National Railways v. Court of Appeals, 139 SCRA 87 [1985]) and it
must be shown that the carrier had observed the required extraordinary
diligence of a very cautious person as far as human care and foresight can
provide or that the accident was caused by a fortuitous event (Estrada v.
Consolacion, 71 SCRA 523 [1976]). Thus, as ruled by this Court, no person
shall be responsible for those "events which could not be foreseen or which
though foreseen were inevitable. (Article 1174, Civil Code). The term is
synonymous with caso fortuito (Lasam v. Smith, 45 Phil. 657 [1924]) which is
of the same sense as "force majeure" (Words and Phrases Permanent Edition,
Vol. 17, p. 362).
In order to constitute a caso fortuito or force majeure that would exempt a
person from liability under Article 1174 of the Civil Code, it is necessary that
the following elements must concur: (a) the cause of the breach of the
obligation must be independent of the human will (the will of the debtor or the
obligor); (b) the event must be either unforeseeable or unavoidable; (c) the
event must be such as to render it impossible for the debtor to fulfill his
obligation in a normal manner; and (d) the debtor must be free from any
participation in, or aggravation of the injury to the creditor (Lasam v. Smith, 45
Phil. 657 [1924]; Austria v. Court of Appeals, 39 SCRA 527 [1971]; Estrada v.
Consolacion, supra; Vasquez v. Court of Appeals, 138 SCRA 553 [1985]; Juan
F. Nakpil & Sons v. Court of Appeals, 144 SCRA 596 [1986]). Caso fortuito or
force majeure, by definition, are extraordinary events not foreseeable or
avoidable, events that could not be foreseen, or which, though foreseen, are
inevitable. It is, therefore, not enough that the event should not have been
foreseen or anticipated, as is commonly believed, but it must be one
31